Competition Law, Innovation and Antitrust

Competition Law, Innovation and Antitrust

An Analysis of Tying and Technological Integration

New Horizons in Competition Law and Economics series

Hedvig Schmidt

This innovative book assesses the hotly debated topic of tying from three different perspectives: competition law, economics and intellectual property rights. It highlights the faults and benefits of the current approaches to tying under EC competition law and US antitrust law.

Chapter 6: Alternative Solutions, the Development of a New Regulatory Model

Hedvig Schmidt

Subjects: law - academic, competition and antitrust law, intellectual property law

Extract

1. INTRODUCTION In this chapter, we will re-assess the five steps approach applied to tying in an attempt to identify and develop a new and better method to deal with tying. Such a new approach must take into account the need for greater flexibility to ensure that all anti-competitive tying arrangements are caught, but the procompetitive ties escape. Therefore the approach must be more flexible towards the company, the product(s) and the market conditions in which the company operates. The approach sought needs to be in line with the current trend in economic thinking, but must also consider the review of Article 82 and Section 2, and the calls made there for a more economic approach. There are therefore several points which need to be considered. First, although an obvious question with an obvious answer: should the current test stay? Does it sufficiently meet the competition requirements for modern day industries? It goes without saying that the answer to that question in the eyes of the author is a clear-cut no. Chapters 2, 3 and 4 have clearly demonstrated that the current test is flawed and ill-equipped to deal with hightechnology industries, rapid innovation and product development. We must therefore re-think and re-evaluate the test to identify another more suitable solution. This leads to the second point: is the approach to tying arrangements the correct one? Should we maintain an illegal per se approach to tying or should we move towards a legal per se approach instead or somewhere...

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