Share

Competition

The concept of potential competition

 

 10 June 2021  Zoom

There have been increasing calls for greater clarity on the way that potential competition is treated within competition law. This reflects the fact that the importance of potential competition in the competitive analysis of many markets has been increasing as the pace of product evolution becomes more and more dynamic. While understanding the intensity of existing competition is still important, it therefore becomes crucial to explore barriers to entry, and the timeframe, likelihood and strength of the potential competitive constraints that are posed by potential entrants and by existing competitors whose potential threat might grow.

Potential competitive constraints can be relevant to the full ambit of competition agencies’ work since:

  • they can be excluded (as for example, is suggested by Kill-Zone theories of harm);
  • they can agree not to compete (as for example, in the case of pay-for-delay agreements);
  • they can be acquired (as for example, in killer acquisition theories of harm); or
  • they can, as a third party, provide constraints that might mitigate concerns over a merger.

In June 2021, the OECD held a roundtable that explored the concept of potential competition. It looked at what potential competition is, in the context of different markets, and consider the timeframe over which it is assessed. It also looked at barriers to entry, and the way in which the potential, rather than existing, nature of a competitive threat affects the way that the threat is analysed.

All related documentation is available on this page.

» Read the OECD Background Note

» See full list of best practice roundtables on competition  

 COMP-concept-potential-competition-400px.jpg
Speakers 

Steven C. Salop Bio 

Professor of Economics and Law, Georgetown University

Koren W. Wong-Ervin Bio   

Partner, Axinn, Veltrop & Harkrider LLP

Niamh Dunne Bio

Associate Professor of Law, London School of Economics

 

Documents

 note cover

OECD Background Note

Paper by Niamh Dunne

Paper by Steven C. Salop

 

Contributions from participating delegations

Belgium

Canada

Chile

Colombia

Costa Rica

Finland

Israel

Mexico

Spain

Turkey

United Kingdom

United States

EU

Brazil

Egypt

Russian Federation

South Africa

BIAC

Summaries of contributions

Videos

Steven Salop on potential competition and antitrust analysis

Niamh Dunne about potential competition in EU competition law  

 Koren Wong-Ervin and the antitrust analysis of acquisitions of potential competitors

 

Related best practice roundtables

Start-ups, killer acquisitions and merger control (2020)

Abuse of dominance in digital markets (2020)

Merger control in dynamic markets (2019)

Non-price effects of mergers (2018)

Generic pharmaceuticals and competition (2014)

Barriers to entry (2005)

See also

OECD Open Day 2021 - Competitive effects of killer acquisitions

OECD best practice roundtables on competition

More OECD work on competition

 

Related Documents