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Your Weekly Digest | Issue 233

Valur Thrainsson
5 min read

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Here below, you find the most recent and relevant competition and anti-trust news, blogs and journal publications over the last week.

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Amazon investigated by German anti-trust watchdog - BBC News

New German laws mean the regulator can take faster action to prohibit any anti-competitive behaviour.

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EU court annuls decision allowing Portugal to channel €1.2 billion of State aid to TAP - Portugal Resident

Court of Justice of European Union has annulls decision by European Commission for State aid to TAP of €1.2 billion

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Tim Cook: Without Apple curation, App Store would be a 'toxic mess' | ZDNet

Testifying in federal court in the Apple-Epic antitrust trial, the Apple CEO defended Apple's App Store policies

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Agency to proceed with administrative trial regarding allegations that vertical merger would harm competition in the U.S. market for life-saving Multi-Cancer Early Detection tests. Read more.
The European Commission has found that Bank of America, Natixis, Nomura, RBS (now NatWest), UBS, UniCredit and WestLB (now Portigon) have breached EU antitrust rules through the participation of a group of traders in a cartel in the primary and secondary market for European Government Bonds (‘EGB'). Read more.
The Information Commissioner’s Office (ICO) and the Competition and Markets Authority (CMA) have published a joint statement, setting out their shared views on the relationship between competition and data protection in the digital economy. Read more.
Despite calls from some NGOs to mandate radical interoperability, the EU’s draft Digital Markets Act (DMA) adopted a more measured approach, requiring full interoperability only in “ancillary” services like identification or payment systems. There remains the possibility, however, that the DMA proposal will be amended to include stronger interoperability mandates, or that such amendments will... Read more.
In a recent blog post, Pablo Ibanez Colomo responded to the observations I had made on his reaction to the issuance of a Statement of Objections in the Apple music streaming case. In this post, I would like to briefly react to Pablo’s response, but also raise additional questions over the application of the so-called effects-based analysis in cases involving leveraging strategies by digital platforms. Read more.
The post published on Monday (see here) sought to explain the tensions that tend to emerge in relation to the interpretation of Article 101(1) TFEU. The experience of the past few years shows that … Read more.
PAULINE AFFELDT, TOMASO DUSO, KLAUS GUGLER, JOANNA PIECHUCKA
Increasing concentration is not unique to the US—recent studies show that concentration is rising in Europe as well, although to a lesser extent than in the US. Is concentration rightly measured? And what are its driving forces? Barriers to entry, one of the most formidable sources of market power, appear to matter most. Read more.
Morris Schonberg, Gonzalo Sanz-Magallón
Royalty calculation methods based on music festivals’ ticket sales without deductions for non-music related expenses and which use flat-rate tranches to take into account the proportion of musical works actually performed, do not infringe Article 102 TFEU, provided that there is no other proportionate method to quantify more precisely the musical works used. On 25 November 2020, the Court of Justice (the ‘Court’) handed down a judgment addressing questions referred for a preliminary ruling by the Ondernemingsrechtbank Antwerp (Companies Court, Antwerp) in relation to the royalty... Read more.
Erik Hovenkamp and Steven C. Salop
We consider strategic behavior in non-Coasean litigation: private disputes such that the court's judgment may influence the final allocation of rights even if transaction costs are zero. This occurs when the law prohibits otherwise-profitable efforts to contract around the court's judgment. This constraint arises in myriad contexts, including antitrust, labor law, unfair competition, and various types of public interest litigation. We show that non-Coasean disputes systematically create incentives for problematic rent-seeking behaviors: strategic investments intended to influence the outcome of litigation, and collusive ex ante settlements that enrich the parties at the public's expense. Read more.
José Azar and Xavier Vives
We use data from the U.S. airline industry to test the hypothesis, consistent with the general equilibrium oligopoly model of Azar and Vives (forthcoming), that inter-industry common ownership should be associated with lower prices in product markets. We find that, as the model predicts, increases over time in intra-industry common ownership are associated with higher prices, while increases in inter-industry common ownership are associated with lower prices. We also find that common ownership by the "Big Three" (BlackRock, Vanguard and State Street) is associated with lower airline prices, while common ownership by shareholders other than the Big Three is associated with higher prices. The results highlight the limitations of partial equilibrium oligopoly theory in the context of common ownership, and the need to consider a general equilibrium perspective. Read more.
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Kind regards, Valur Þráinsson, Founder of CompetitionFeed.com. Email: valur@competitionfeed.com
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