Digital markets are under intense scrutiny. A notable concern is that competition authorities have insufficient scope to block acquisitions of innovative potential entrants that might otherwise have become a disruptive competitive influence and a spur for increased innovation in digital markets. In one response, a recent report prepared for the UK Government by a digital competition expert panel headed by Professor Jason Furman has proposed significant reforms to the UK merger regime. These include a recommendation that the “balance of probabilities” test of harm currently applied by the UK Competition and Markets Authority (“CMA”) is replaced by a new test based on the “balance of harms”. Similar issues are also considered in a recent report commissioned by DG Competition: “Competition Policy for the Digital Era” by Jacques Crémer, Yves-Alexandre de Montjoye and Heike Schweitzer.
This latest RBB Brief discusses the merits of introducing a balance of harms test into merger control.
