14. The Office of Telecommunications: A New Competition Authority?

AbstractIn markets where hospitals are expected to compete, preventive merger control aims to prohibit anticompetitive mergers. In the hospital industry, however, the standard method for defining the relevant market (SSNIP) is difficult to apply and alternative approaches have proven inaccurate. Experiences from the United States show that courts, by identifying overly broad geographic markets, have underestimated the anticompetitive effects of hospital mergers. We examine how geographic hospital markets are defined in Germany and the Netherlands where market-oriented reforms have created room for hospital competition. For each country, we discuss a landmark case where definition of the geographic market played a decisive role. Our findings indicate that defining geographic hospital markets in both countries is less complicated than in the United States, where antitrust analysis must take managed care organisations into account. We also find that different methods result in much more stringent hospital merger control in Germany than in the Netherlands. Given the uncertainties in defining hospital markets, the German competition authority seems to be inclined to avoid the risk of being too permissive; the opposite holds for the Dutch competition authority. We argue that for society the costs of being too permissive with regard to hospital mergers may be larger than the costs of being too stringent.

Download Full-text

Excessive Pharmaceutical Pricing as an Abuse of Dominant Position – The Case of CD Pharma (Denmark)

GRUR International ◽

10.1093/grurint/ikab117 ◽

2021 ◽

Author(s):

Behrang Kianzad

Keyword(s):

Public Procurement ◽

Economic Value ◽

Pharmaceutical Market ◽

Market Definition ◽

Competition Authority ◽

The European Union ◽

Pharmaceutical Pricing ◽

Relevant Market ◽

Dominant Position ◽

Abuse Of Dominant Position

Abstract On 31 January 2018, the Danish Competition and Consumer Authority adopted a decision1 finding the Swedish company generic distributor CD Pharma in breach of Art. 102(a) Treaty on the Functioning of the European Union (TFEU) by abusing its dominant position and having imposed excessive and unfair prices for the drug Syntocinon. The company increased the price of the drug by 2000% in the period April-October 2014 in the Danish pharmaceutical market. CD Pharma appealed to the Danish Competition Appeals Board,2 which on 29 November 2018 upheld the decision by the Authority. On subsequent appeal to the Danish Maritime and Commercial Court,3 the judgment by the previous court was upheld in a 3-2 decision on 2 March 2020, thus finding CD Pharma liable for infringement of Danish competition law as well as Art. 102(a) TFEU. The decision is final and not subject to further appeal. The case raises outstanding legal-economic issues regarding excessive pricing such as relevant market definition in pharmaceutical cases, the length of abuse, competitive price benchmarks, definition of economic value and the matter of dominance in public procurement and tenders. The case is rather unusual in that the alleged abusive period amounted to a six-month period, CD Pharma was the ‘losing’ party in the bidding process for the supply of the medicine in question, and CD Pharma subsequently had reduced prices through negotiations with the Danish central medicine procurer, Amgros. Similar to the Aspen Pharma decision4 by the Italian Competition Authority, where the Italian Medicine Agency (AIFA) reported the case to the Competition Authority, it was the Danish medicine procurer Amgros who had notified the Danish Competition and Consumer Authority about allegedly abusive practices. This subsequently led to an investigation and the adoption of the Decision. Following an introduction describing the Danish pharmaceutical market and specifics of the case, section two of this contribution details the proceedings at Danish Competition Authority. Section three depicts the proceedings at Competition Appeals Tribunal, and section four deals with the proceedings at the Maritime and Commercial Court. Section five concludes.

Download Full-text

Economic analysis of the firm’s boundaries and the limits of competition: The case of Nord Stream 2 AG

Voprosy Ekonomiki ◽

10.32609/0042-8736-2021-10-134-151 ◽

2021 ◽

pp. 134-151

Author(s):

S. B. Avdasheva ◽

G. F. Yusupova

Keyword(s):

Price Discrimination ◽

Joint Venture ◽

Competition Law ◽

Competition Authority ◽

Gas Market ◽

Infrastructure Investments ◽

Nord Stream ◽

Economic Concentration ◽

Legal Concepts ◽

Available Information

Using publicly available information, the article examines the economic concepts, which underlie the arguments of the decision of Polish competition authority UOKiK in relation to the participants of the Nord Stream 2. It explains the interrelation between economic and legal concepts, which are to be applied to interpret the competitive impact of joint venture and probable theory of harm for infrastructure investments under competition law of European Union, including in comparison with Russian competition law. It has been demonstrated that the resolution of a consortium case should be based on the proof of two statements. The first statement implies that the joint venture is a firm (and therefore the creation of a joint venture is a deal leading to economic concentration). The second statement means that despite Gazprom adopted the commitments about decision of the European Commission and trends in the development of the European gas market, the possibility of price discrimination is retained. Discussion and contestation of the decision against PJSC Gazprom testify in favor of maintaining the relevance of institutional studies and studies of industry markets for resolving legal disputes arising from the application of competition law.

Download Full-text

Exploring the impact of intellectual capital on company reputation and performance

Journal of Intellectual Capital ◽

10.1108/jic-01-2018-0012 ◽

2018 ◽

Vol 19 (5) ◽

pp. 915-934 ◽

Cited By ~ 31

Author(s):

Gianluca Ginesti ◽

Adele Caldarelli ◽

Annamaria Zampella

Keyword(s):

Human Capital ◽

Intellectual Capital ◽

Corporate Reputation ◽

Intangible Asset ◽

Competition Authority ◽

Data Set ◽

Content Type ◽

Capital Efficiency ◽

And Performance ◽

The Impact

Purpose The purpose of this paper is to analyse the impact of intellectual capital (IC) on the reputation and performance of Italian companies. Design/methodology/approach The paper exploits a unique data set of 452 non-listed companies that obtained a reputational assessment from the Italian Competition Authority (ICA). To test the hypotheses, this study implemented several regression analyses. Findings Results support the argument that human capital efficiency is a key driver of corporate reputation. Findings also reveal that companies, which obtained reputational rating under ICA scrutiny, show a positive relationship between IC elements and various measures of financial performance. Research limitations/implications The study focuses on a single country; it is not free from the imprecisions of Pulic’s VAIC model. Practical implications This paper recommends companies that are interested to achieve a robust reputation should consider the human capital as a strategic intangible asset. Second, the results suggest that companies with an ICA reputational rating are able to leverage their intangibles to potentiate performance and competitiveness. Originality/value This is the first empirical investigation on the contribution of IC in generating value for corporate reputation. Additionally, the study contributes to the literature on the link between IC and performance by examining a sample of firms not yet explored in prior research.

Download Full-text

Competition Law and State Aid for Failing Banks in the EU and its Specific Implications for CEE Member States

Yearbook of Antitrust and Regulatory Studies ◽

10.7172/1689-9024.yars.2016.9.14.6 ◽

2016 ◽

Vol 9 (14) ◽

pp. 145-157

Author(s):

Virág Blazsek

Keyword(s):

European Union ◽

State Aid ◽

Common Market ◽

Competition Authority ◽

The European Union ◽

Member States ◽

Positive Effects ◽

The Stability ◽

Bank Bailouts ◽

The Eu

The bank bailouts following the global financial crisis of 2008 have been subject to prior approval of the European Commission (EC), the competition authority of the European Union. The EC was reluctant to reject rescue efforts directed at failing banks and so it consistently approved all such requests submitted by Member States. Out of the top twenty European banks, the EC authorized State aid to at least twelve entities. In this context, the paper outlines the gradually changing interpretation of EU State aid rules, the “temporary and extraordinary rules” introduced starting from late 2008, and the extension of the “no-State aid” category. The above shifts show that the EC itself deflected from relevant EU laws in order to systemically rescue important banks in Europe and restore their financial stability. The paper argues that bank bailouts and bank rescue packages by the State have led to different effects on market structures and consumer welfare in the Eurozone and non-Eurozone areas, mostly the Eastern segments of the European Union. As such, it is argued that they are inconsistent with the European common market. Although the EC tried to minimize the distortion of competition created as a result of the aforementioned case law primarily through the application of the principle of exceptionality and different compensation measures, these efforts have been at least partially unsuccessful. Massive State aid packages, the preferential treatment of the largest, or systemically important, banks through EU State aid mechanisms – almost none of which are Central and Eastern European (CEE) – may have led to the distortion of competition on the common market. That is so mainly because of the prioritization of the stability of the financial sector and the Euro. The paper argues that State aid for failing banks may have had important positive effects in the short run, such as the promotion of the stability of the banking system and the Euro. In the longrun however, it has contributed to the unprecedented sovereign indebtedness in Europe, and contributed to an increased economic and political instability of the EU, particularly in its most vulnerable CEE segment.

Download Full-text

Exploitative Abuse of a Dominant Position in the Bulgarian Energy Markets

Yearbook of Antitrust and Regulatory Studies ◽

10.7172/1689-9024.yars.2017.10.16.2 ◽

2017 ◽

Vol 10 (16) ◽

pp. 33-55

Author(s):

Miroslava Marinova ◽

Kremena Yaneva-Ivanova

Keyword(s):

Energy Markets ◽

Regulatory Control ◽

Competition Authority ◽

Water Regulation ◽

Pricing Policy ◽

Dominant Position ◽

Legal Standards ◽

General Terms ◽

Contractual Relationships ◽

The Eu

In the last few years the behavior of undertakings operating in the regulated utility markets, such as energy, water and communications, has been in the focus of the Bulgarian Competition Authority (hereinafter, BCA). Typically, these companies are dominant due to their exclusive licenses to operate in a certain territory and thus the contents of their contractual relationships with customers are often defined in general terms and conditions (hereinafter, GTCs) adopted or approved by the respective sector regulator. Most or all aspects of their pricing policy is also subject to sector regulation. By analysing critically two landmark decisions of the BCA concerning abuses of companies active in the energy markets, this paper raises the following questions: (1) to what extent the BCA is competent to intervene and sanction those undertakings for conduct which is subject of regulatory control by the sector regulator (the Energy and Water Regulation Commission (hereinafter, EWRC)) and (2) whether in its enforcement practice against those undertakings, the BCA is following the legal standards adopted by the EU courts.

Download Full-text