R‌ead the background note

Mergers in digital markets have been much discussed in recent years, following the growing concerns around the acquisition strategies of major tech platforms. In parallel to the well-known debate on killer acquisitions and notification thresholds, new questions have started to emerge about the suitability of existing theories of harm for an effective assessment of mergers in digital markets.

In June 2023 the OECD held a roundtable discussing the theories of harm currently used in the analysis of digital mergers, the potential need to develop new ones that could better capture competitive harms, and the challenges that this may bring for competition authorities.

KEY FINDINGS FROM THE JUNE 2023 DISCUSSION

The discussion highlighted the fact that specific features of digital mergers, such as the prominent role of platform ecosystems relying on strong network effects, high quality algorithms, economies of scale and data-driven economies of scope, bring into question the ability of traditional theories of harm to reflect the real competitive harm that may result from mergers in these markets. Contributions from delegates indicated that many jurisdictions have already sought to fine-tune theories of harm to better reflect the specific characteristics of digital markets, including to account for network effects, harms to innovation and privacy, and the potential for mergers to entrench ecosystems. Some delegates indicated their intention to move further in this direction, including through the revision of merger guidelines, while others encouraged caution and a need to first identify a clear enforcement gap in unambiguous terms. Challenges were identified, including with respect to the ability of competition authorities to continue meet legal tests and standards of proof.

2024 OECD COMPETITION OPEN DAY EXPLORES THEORIES OF HARM FOR DIGITAL MERGERS

The topic will again be explored again on 6 March 2024 during the 2024 OECD Competition Open Day, an event open to the public.

Learn more about it and register now to attend in person or online!

See the full list of best practice roundtables on competition

JUNE 2023 DISCUSSION MATERIALS

Luís Cabral Bio  
Paganelli-Bull Professor of Economics, New York University Stern School of Business

Annabelle Gawer Bio  
Professor in Digital Economy & Director, Centre of Digital Economy, University of Surrey

Viktoria Robertson Bio  
Professor of Competition Law, Vienna University of Economics and Business & University of Graz

OECD Background Note | Note de référence de l'OCDE

Note by Viktoria Robertson 

Detailed Summary of the discussion EN | FR

Executive Summary with key findings EN | FR

Contributions from participating delegations

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

Competition Economics of Digital Ecosystems (2020)

Quality considerations in the zero-price economy (2018)

Non-price effects of mergers (2018)

Merger control in dynamic markets (2019)

Conglomerate effects of mergers (2020)

The concept of potential competition (2021)

Ex Ante Regulation and Competition in Digital Markets (2021)

Rethinking the use of traditional antitrust enforcement tools in multi-sided markets (2017)

Vertical mergers in the technology, media and telecom sector (2019)

OECD best practice roundtables on competition

More OECD work on competition