European Commission reports on competition policy in the digital era

European Commission reports on competition policy in the digital era

The European Commission has published a report titled "Competition Policy for the digital era".

The report makes interesting reading, released within days of Vestager’s announcement that the Commission could decide whether to open a full investigation into Amazon’s treatment of merchant data within a matter of months.

The report identifies three key features of the digital economy: extreme returns relative to scale, network externalities, and the role of data.

The writers believe that the basic competition law framework under Article 101/ 102 of the TFEU provides a sound basis for protecting competition in the digital economy.  However, they note that the features of platforms, digital ecosystems and the data economy may need to be adapted when looking at market power and defining relevant markets.

The writers do not go as far as advocating changes to the merger control jurisdictional thresholds but say that the operation of transaction value thresholds as applied in some member states should be monitored.  The report considers that the existing substantive test of significant impediment to effective competition does not require amendment but a new theory of harm may be needed to take into account adverse effects on competition and consumer welfare arising in digital markets.

"Competition Policy for the digital era", a report by Jacques Crémer, Yves-Alexandre de Montjoye and Heike Schweitzer