Competition matters were in the public eye last year as rarely before, raising questions as to whether the structure of competition law needs to be updated for the modern age. Claims that globalisation has resulted in markets becoming more concentrated have led to calls for a revised approach to antitrust, while the rise of a clutch of technology giants has fuelled global concerns that competition law may be unable to deal with the issues they raise. Even in more traditional industries regulators are getting tougher and investigating with unprecedented rigour. This bulletin looks at how the authorities have been reacting to these developments and how their responses might influence case work in 2018 and beyond.
As we enter 2018, competition authorities around the world are under public pressure as market developments – most obviously in ‘big tech’ – have sparked concerns that competition law enforcement, as it currently stands, is not fit for purpose. There is unease, first expressed in the US, that markets are becoming more concentrated and that profits across the economy are increasing, perhaps driven by increased market power. The Economist magazine has voiced similar worries, focusing in particular on the control of data and the power of internet giants such as Google, Amazon, Facebook and Apple.
Competition authorities are reacting to this changing environment by looking to sharpen old tools. They’re also seeking to use the flexibility of the current framework to construct new economic theories of harm that tackle these emerging issues. This bulletin explores these developments. In particular, it describes how older theories of harm have been upgraded and made more sophisticated; it identifies innovative theories that capture behaviour that would previously have been difficult to regulate; it then looks at how the authorities have been rising to the challenges posed by large online firms.