Types of economic analysis taken into account in the construction of the indicators of the extent of economic analysis
| Block or component of analysis . | Description . | Comment . | Score . |
|---|---|---|---|
| A | Discussion of the nature and characteristics of the conduct | Since in all cases there must be some discussion of the nature and characteristics of the conduct, we should not get a score of ‘0’ here—in this sense this category is not needed. It is included for purely formal reasons, to remind ourselves that an overall score of ‘1’ is a strict Per Se approach to the assessment, meaning that the CA only considered the nature and characteristics of the conduct. | 0/1 |
| B | Market Analysis | Comment | |
| B.1 | Basic analysis of market characteristics based on available information and market statistics | This is economic analysis that is necessary in order for a CA to contextualize a conduct. This typically involves information about industry structure, the firms, the structure of demand and the technology, determination of market shares (without formal analysis of market definition). | 0/1 |
| or B.2 | Formal market delineation and market share determination | Market definition based on more sophisticated economic tests (eg SSNIP test, Price correlation and Critical loss analysis). | |
| C | Evidence on restrictions of competition/ harm imposed | Comment | |
| C.1. | Analysis undertaken to identify if the conduct has market power enhancing (eg through agreements) or exclusionary (eg in monopolization practices) effects | This need not include the construction of a formal model (eg examination of incentive compatibility constraints in a concerted practice case, or examination of how exclusive contracts could lead to exclusion or prevent entry in the specific context, or ‘equally efficient competitor test’). But must indicate a serious effort to demonstrate the presence of such effects. | 0/1 |
| C.2. | Articulation of theory of harm to consumer welfare (without taking into account of efficiencies) | When “scoring” CAs decisions this need not be a full-blown formal analysis; one could also score an effort towards determining whether exclusionary effects can be expected to create a negative impact on consumers (through a price increase or a reduction in quality or diversity). | 0/1 |
| C.3. | Analysis of potential efficiency effects expected to benefit consumers | Analysis should be based on efficiencies that are expected to result from the conduct, that will create benefits to consumers (again, this need not be very sophisticated but must indicate a serious effort to take efficiencies into account). Analysis of potential Efficiency Defence relating to factors that tend to prevent a price rise or other harm to consumers.NOTE: Counterfactual analysisa may be undertaken under any of the C components—though this is not strictly necessary for considering the effect as established. | 0/1 |
| D | More effects-based analysis | Comment | |
| D | Balancing of potential anticompetitive effects of conduct with all the potential efficiencies and determination of the final impact on total welfare. | This is any analysis ‘over and above’ the analysis that may have been included under “efficiencies” above (taking into account efficiencies that need not impact consumers, especially in the short-term). By ‘balancing’ here we mean any formal economic analysis that attempts to measure the net effect of the conduct, that may or may not be related to efficiencies—eg balancing the short-term and long-term implications of refusal to license (or of compulsory licensing) an innovative activity. | 0/1 |
| Maximum Total Score | 6 (when the Substantive Standard is that of total welfare)b5 (when the Substantive Standard is that of consumer welfare)c | ||
| Block or component of analysis . | Description . | Comment . | Score . |
|---|---|---|---|
| A | Discussion of the nature and characteristics of the conduct | Since in all cases there must be some discussion of the nature and characteristics of the conduct, we should not get a score of ‘0’ here—in this sense this category is not needed. It is included for purely formal reasons, to remind ourselves that an overall score of ‘1’ is a strict Per Se approach to the assessment, meaning that the CA only considered the nature and characteristics of the conduct. | 0/1 |
| B | Market Analysis | Comment | |
| B.1 | Basic analysis of market characteristics based on available information and market statistics | This is economic analysis that is necessary in order for a CA to contextualize a conduct. This typically involves information about industry structure, the firms, the structure of demand and the technology, determination of market shares (without formal analysis of market definition). | 0/1 |
| or B.2 | Formal market delineation and market share determination | Market definition based on more sophisticated economic tests (eg SSNIP test, Price correlation and Critical loss analysis). | |
| C | Evidence on restrictions of competition/ harm imposed | Comment | |
| C.1. | Analysis undertaken to identify if the conduct has market power enhancing (eg through agreements) or exclusionary (eg in monopolization practices) effects | This need not include the construction of a formal model (eg examination of incentive compatibility constraints in a concerted practice case, or examination of how exclusive contracts could lead to exclusion or prevent entry in the specific context, or ‘equally efficient competitor test’). But must indicate a serious effort to demonstrate the presence of such effects. | 0/1 |
| C.2. | Articulation of theory of harm to consumer welfare (without taking into account of efficiencies) | When “scoring” CAs decisions this need not be a full-blown formal analysis; one could also score an effort towards determining whether exclusionary effects can be expected to create a negative impact on consumers (through a price increase or a reduction in quality or diversity). | 0/1 |
| C.3. | Analysis of potential efficiency effects expected to benefit consumers | Analysis should be based on efficiencies that are expected to result from the conduct, that will create benefits to consumers (again, this need not be very sophisticated but must indicate a serious effort to take efficiencies into account). Analysis of potential Efficiency Defence relating to factors that tend to prevent a price rise or other harm to consumers.NOTE: Counterfactual analysisa may be undertaken under any of the C components—though this is not strictly necessary for considering the effect as established. | 0/1 |
| D | More effects-based analysis | Comment | |
| D | Balancing of potential anticompetitive effects of conduct with all the potential efficiencies and determination of the final impact on total welfare. | This is any analysis ‘over and above’ the analysis that may have been included under “efficiencies” above (taking into account efficiencies that need not impact consumers, especially in the short-term). By ‘balancing’ here we mean any formal economic analysis that attempts to measure the net effect of the conduct, that may or may not be related to efficiencies—eg balancing the short-term and long-term implications of refusal to license (or of compulsory licensing) an innovative activity. | 0/1 |
| Maximum Total Score | 6 (when the Substantive Standard is that of total welfare)b5 (when the Substantive Standard is that of consumer welfare)c | ||
ie analysis proposing that the theory of harm is not valid and demonstrating the absence of foreclosure effects and consumer harm of an exclusionary conduct.
ie when the criterion for liability is whether or not there is an adverse effect on total welfare.
ie when the criterion for liability is whether or not there is an adverse effect on consumer welfare. Analysis component D need not be undertaken if the substantive standard is that of consumer welfare.
Types of economic analysis taken into account in the construction of the indicators of the extent of economic analysis
| Block or component of analysis . | Description . | Comment . | Score . |
|---|---|---|---|
| A | Discussion of the nature and characteristics of the conduct | Since in all cases there must be some discussion of the nature and characteristics of the conduct, we should not get a score of ‘0’ here—in this sense this category is not needed. It is included for purely formal reasons, to remind ourselves that an overall score of ‘1’ is a strict Per Se approach to the assessment, meaning that the CA only considered the nature and characteristics of the conduct. | 0/1 |
| B | Market Analysis | Comment | |
| B.1 | Basic analysis of market characteristics based on available information and market statistics | This is economic analysis that is necessary in order for a CA to contextualize a conduct. This typically involves information about industry structure, the firms, the structure of demand and the technology, determination of market shares (without formal analysis of market definition). | 0/1 |
| or B.2 | Formal market delineation and market share determination | Market definition based on more sophisticated economic tests (eg SSNIP test, Price correlation and Critical loss analysis). | |
| C | Evidence on restrictions of competition/ harm imposed | Comment | |
| C.1. | Analysis undertaken to identify if the conduct has market power enhancing (eg through agreements) or exclusionary (eg in monopolization practices) effects | This need not include the construction of a formal model (eg examination of incentive compatibility constraints in a concerted practice case, or examination of how exclusive contracts could lead to exclusion or prevent entry in the specific context, or ‘equally efficient competitor test’). But must indicate a serious effort to demonstrate the presence of such effects. | 0/1 |
| C.2. | Articulation of theory of harm to consumer welfare (without taking into account of efficiencies) | When “scoring” CAs decisions this need not be a full-blown formal analysis; one could also score an effort towards determining whether exclusionary effects can be expected to create a negative impact on consumers (through a price increase or a reduction in quality or diversity). | 0/1 |
| C.3. | Analysis of potential efficiency effects expected to benefit consumers | Analysis should be based on efficiencies that are expected to result from the conduct, that will create benefits to consumers (again, this need not be very sophisticated but must indicate a serious effort to take efficiencies into account). Analysis of potential Efficiency Defence relating to factors that tend to prevent a price rise or other harm to consumers.NOTE: Counterfactual analysisa may be undertaken under any of the C components—though this is not strictly necessary for considering the effect as established. | 0/1 |
| D | More effects-based analysis | Comment | |
| D | Balancing of potential anticompetitive effects of conduct with all the potential efficiencies and determination of the final impact on total welfare. | This is any analysis ‘over and above’ the analysis that may have been included under “efficiencies” above (taking into account efficiencies that need not impact consumers, especially in the short-term). By ‘balancing’ here we mean any formal economic analysis that attempts to measure the net effect of the conduct, that may or may not be related to efficiencies—eg balancing the short-term and long-term implications of refusal to license (or of compulsory licensing) an innovative activity. | 0/1 |
| Maximum Total Score | 6 (when the Substantive Standard is that of total welfare)b5 (when the Substantive Standard is that of consumer welfare)c | ||
| Block or component of analysis . | Description . | Comment . | Score . |
|---|---|---|---|
| A | Discussion of the nature and characteristics of the conduct | Since in all cases there must be some discussion of the nature and characteristics of the conduct, we should not get a score of ‘0’ here—in this sense this category is not needed. It is included for purely formal reasons, to remind ourselves that an overall score of ‘1’ is a strict Per Se approach to the assessment, meaning that the CA only considered the nature and characteristics of the conduct. | 0/1 |
| B | Market Analysis | Comment | |
| B.1 | Basic analysis of market characteristics based on available information and market statistics | This is economic analysis that is necessary in order for a CA to contextualize a conduct. This typically involves information about industry structure, the firms, the structure of demand and the technology, determination of market shares (without formal analysis of market definition). | 0/1 |
| or B.2 | Formal market delineation and market share determination | Market definition based on more sophisticated economic tests (eg SSNIP test, Price correlation and Critical loss analysis). | |
| C | Evidence on restrictions of competition/ harm imposed | Comment | |
| C.1. | Analysis undertaken to identify if the conduct has market power enhancing (eg through agreements) or exclusionary (eg in monopolization practices) effects | This need not include the construction of a formal model (eg examination of incentive compatibility constraints in a concerted practice case, or examination of how exclusive contracts could lead to exclusion or prevent entry in the specific context, or ‘equally efficient competitor test’). But must indicate a serious effort to demonstrate the presence of such effects. | 0/1 |
| C.2. | Articulation of theory of harm to consumer welfare (without taking into account of efficiencies) | When “scoring” CAs decisions this need not be a full-blown formal analysis; one could also score an effort towards determining whether exclusionary effects can be expected to create a negative impact on consumers (through a price increase or a reduction in quality or diversity). | 0/1 |
| C.3. | Analysis of potential efficiency effects expected to benefit consumers | Analysis should be based on efficiencies that are expected to result from the conduct, that will create benefits to consumers (again, this need not be very sophisticated but must indicate a serious effort to take efficiencies into account). Analysis of potential Efficiency Defence relating to factors that tend to prevent a price rise or other harm to consumers.NOTE: Counterfactual analysisa may be undertaken under any of the C components—though this is not strictly necessary for considering the effect as established. | 0/1 |
| D | More effects-based analysis | Comment | |
| D | Balancing of potential anticompetitive effects of conduct with all the potential efficiencies and determination of the final impact on total welfare. | This is any analysis ‘over and above’ the analysis that may have been included under “efficiencies” above (taking into account efficiencies that need not impact consumers, especially in the short-term). By ‘balancing’ here we mean any formal economic analysis that attempts to measure the net effect of the conduct, that may or may not be related to efficiencies—eg balancing the short-term and long-term implications of refusal to license (or of compulsory licensing) an innovative activity. | 0/1 |
| Maximum Total Score | 6 (when the Substantive Standard is that of total welfare)b5 (when the Substantive Standard is that of consumer welfare)c | ||
ie analysis proposing that the theory of harm is not valid and demonstrating the absence of foreclosure effects and consumer harm of an exclusionary conduct.
ie when the criterion for liability is whether or not there is an adverse effect on total welfare.
ie when the criterion for liability is whether or not there is an adverse effect on consumer welfare. Analysis component D need not be undertaken if the substantive standard is that of consumer welfare.
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