EU regulators want broader rules defining companies’ market power, with more weight given to innovation and pointers on what digital markets are, the European Commission said on Tuesday, prompted in part by the growing power of tech giants.
The rules, known as the EU market definition notice, date
back to 1997 and help regulators measure a company’s pricing power in a merger
or its power to shut out rivals in an antitrust case.
The information can help regulators to decide whether to
demand concessions from a company. Businesses and academics have in recent
years criticized EU antitrust laws for being inadequate, especially in relation
to U.S. tech giants’ merger deals and market power.
Following feedback from more than 100 stakeholders, the EU
executive proposed some additions to the rules.
These include greater emphasis on non-price elements such as
innovation and quality of products and services and new guidance defining
digital markets such as multi-sided markets and digital eco-systems where
products are built around a mobile operating system.
For markets expected to undergo structural transitions, such
as technological or regulatory changes, the rules will take a forward-looking
approach, the Commission said.
There will be need for principles clarifying how markets
should be assessed where companies compete on innovation, including through
pipeline products. This feature mainly targets pharmaceutical companies.
Interested parties have until Jan. 13 to provide feedback before
the Commission finalizes its proposals and adopt the new rules in the third
quarter of 2023.