LAW & ECONOMICS: COMPETITION POLICY - ABUSE - GERMANY - REFORM - DIGITAL ECONOMY

Outstanding relevance across markets: A new concept of market power?

The ministerial proposal for a 10th amendment of the German competition law particularly addresses abuse control and seeks to tighten this pillar of competition policy against the background of the challenges from the digital economy. Next to extending the classic policy instruments of abuse control, the reform proposal suggests to introduce an additional and novel type of market power: the outstanding relevance across markets (ORAM). From an economic perspective, such an institution is interesting as it emphasizes non-horizontal and less direct anticompetitive abuses of market power. We review what type of cases could be subject to such a concept of systemic market power. Furthermore, we address the question whether merger control could also benefit from an ORAM-style concept.

I. A new concept of market power 1. Combating the abuse of market power represents an important pillar of competition policy next to the enforcement of anti-cartel laws and merger control. Since companies can reach positions of market power through very different ways including procompetitive and welfare-enhancing internal growth through breakthrough innovation or superior efficiency, most competition policy regimes do not prohibit market power as such. However, the anticompetitive abuse of market power is commonly prohibited and competition authorities take action to enforce the respective laws by enjoining exploitative and exclusionary business strategies as well as issuing fines on abusive practices. From an economic perspective, three types of market power are usually

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Authors

  • Ilmenau University of Technology
  • Ilmenau University of Technology
  • Ilmenau University of Technology

Quotation

Olivier Budzinski, Sophia Gaenssle, Annika Stöhr, Outstanding relevance across markets: A new concept of market power?, September 2020, Concurrences N° 3-2020, Art. N° 95888, pp. 38-42

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