|
Table of Merger Decisions
|
viii
|
|
Acknowledgments
|
xiii
|
|
Foreword by Nicholas Levy
|
xv
|
|
A Comment on the Text by Professor Jeffrey Church
|
xvii
|
|
1 Introduction
|
1
|
|
1. Purpose and scope of this book
|
1
|
|
2. Legal framework and Commission procedure
|
3
|
|
2.1 The Merger Regulation
|
3
|
|
2.2 Procedure for notification and assessment
|
7
|
|
3. The role of economics in EU merger control
|
12
|
|
4. Basic economic concepts
|
13
|
|
4.1 The demand curve
|
14
|
|
4.2 The cost curve
|
20
|
|
4.3 Profit maximisation
|
23
|
|
4.4 Market power
|
24
|
|
5. Empirical economic evidence
|
27
|
|
2 Market definition
|
31
|
|
1. Introduction
|
31
|
|
2. Conceptual framework
|
33
|
|
2.1 The hypothetical monopolist/SSNIP test
|
33
|
|
2.2 Issues and complications arising in market definition
|
36
|
|
3. Empirical techniques to assess market definition
|
43
|
|
3.1 Critical loss analysis
|
46
|
|
3.2 Demand estimation
|
64
|
|
3.3 Survey evidence
|
74
|
|
3.4 Analysis of sales patterns
|
81
|
|
3.5 Analysis of price levels
|
93
|
|
3.6 Price correlation analysis
|
105
|
|
3.7 Stationarity analysis
|
127
|
|
3.8 Shock analysis
|
134
|
|
3 Horizontal mergers I: unilateral effects
|
148
|
|
1. Introduction
|
148
|
|
2. Important competitive constraints: economic theory and the EC Horizontal Merger Guidelines
|
150
|
|
2.1 Economic theory and key concepts
|
150
|
|
2.2 Important competitive constraints in the EC Horizontal Merger Guidelines
|
158
|
|
2.3 Commission's recent enforcement practice
|
163
|
|
3. Important competitive constraints between the parties: empirical techniques
|
176
|
|
3.1 Survey evidence
|
177
|
|
3.2 Customer switching analysis
|
183
|
|
3.3 Price/concentration studies and analysis of the impact of rivals' presence
|
191
|
|
3.4 Entry analysis
|
207
|
|
3.5 Natural experiments
|
211
|
|
3.6 Merger simulation
|
214
|
|
3.7 Win/loss and bidding analysis
|
231
|
|
4. Further issues relevant in the assessment of unilateral effects
|
251
|
|
4.1 Introduction
|
251
|
|
4.2 Elimination of potential competition
|
252
|
|
4.3 Rivals' ability to increase supply
|
258
|
|
4.4 Switching costs
|
275
|
|
4.5 Partial ownership
|
282
|
|
5. Countervailing factors
|
288
|
|
5.1 Introduction
|
288
|
|
5.2 Buyer power
|
288
|
|
5.3 Product repositioning and new entry
|
298
|
|
5.4 Efficiency analysis
|
304
|
|
5.5 Failing firm defence
|
310
|
|
4 Horizontal mergers II: coordinated effects
|
318
|
|
1. Introduction
|
318
|
|
2. Economic concepts
|
321
|
|
2.1 Textbook tacit coordination
|
321
|
|
2.2 Factors that affect the critical discount factor
|
326
|
|
3. Framework for the assessment of coordinated effects
|
335
|
|
3.1 Will the merged entity and remaining competitors be able to reach a tacit understanding?
|
337
|
|
3.2 Are market characteristics such that any tacit understanding would likely be sustained?
|
349
|
|
3.3 Will the proposed transaction make it significantly more likely that tacit coordination will occur or make tacit coordination more effective?
|
368
|
|
5 Non-horizontal mergers
|
378
|
|
1. Introduction
|
378
|
|
2. Economic concepts
|
380
|
|
2.1 Pro-competitive effects
|
380
|
|
2.2 Foreclosure and anti-competitive foreclosure
|
385
|
|
2.3 Other anti-competitive effects
|
389
|
|
3. Vertical mergers: input foreclosure
|
391
|
|
3.1 Ability to engage in input foreclosure
|
393
|
|
3.2 Incentive to engage in input foreclosure
|
409
|
|
3.3 Effect of input foreclosure
|
428
|
|
4. Vertical mergers: customer foreclosure
|
430
|
|
4.1 Ability to engage in customer foreclosure
|
432
|
|
4.2 Incentive to engage in customer foreclosure
|
439
|
|
4.3 Effect of customer foreclosure
|
446
|
|
4.4 Customer foreclosure: EU case law
|
448
|
|
5. Conglomerate mergers
|
452
|
|
5.1 Ability to foreclose in conglomerate mergers
|
455
|
|
5.2 Incentive to foreclose in conglomerate mergers
|
458
|
|
5.3 Effects of foreclosure in conglomerate mergers
|
461
|
|
5.4 Foreclosure in conglomerate mergers: an example
|
464
|
|
5.5 Assessment of foreclosure in conglomerate mergers: EU case law
|
480
|
|
6. Diagonal mergers
|
502
|
|
6.1 Diagonal mergers: an example
|
503
|
|
6.2 Case study: Google/Doubleclick – assessment of diagonal effects
|
504
|
|
Appendix ARegression analysis and econometrics
|
507
|
|
1. Regression analysis and statistical inference
|
507
|
|
2. Regression analysis, endogeneity and the identification of economic effects
|
515
|
|
Appendix BModels for demand estimation
|
520
|
|
1. Introduction
|
520
|
|
1.1 Alternative models for continuous demand estimation
|
520
|
|
1.2 Models for discrete demand estimation
|
522
|
|
Index
|
526
|
