Europe: economist perspective

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Economic analysis continues to take centre stage in the assessment of competition cases by the European Commission’s Directorate General for Competition (DG Comp), and its role has expanded in recent years.

The importance of large-scale quantitative economic analysis in mergers and antitrust cases continues to grow, both because more data is available in all sectors and because many industries that are now at the focus of enforcer’s attention are more data intensive. Qualitative economic analysis has also become paramount in understanding and arguing complex theories of harm in dynamic markets, particularly where vertical or conglomerate aspects of a merger exist.

Moreover, economic analysis is starting to gain further ground in the assessment of state aid cases. The recent adoption of the Foreign Subsidies Regulation (FSR) brings new subsidy control powers to the DG Comp, and these assessments are expected to require extensive economic analysis.

The role of economics within the implementation of the Digital Markets Act (DMA) is still unclear, although there is widespread agreement that it will play an important role in compliance assessment. With regards to sustainability considerations in merger control and article 101 assessments, the jury is still out on how this will work out in practice.

Finally, the Commission has issued revisions to its document “Guidance on the Commission’s enforcement priorities in applying article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings” (Guidance paper), together with the announcement of the intention to issue guidelines and the release of a new competition policy brief. While there is agreement that economists will continue to play a key role in article 102 investigations going forward, practitioners have mixed views on the practical implications of these changes.

To gain a deeper understanding of the role of economics in competition cases and discuss its expected evolution, we consulted leading professionals from some of the most experienced law firms in Brussels: Allen & Overy, Arnold & Porter, Clifford Chance, DLA Piper, Freshfields Bruckhaus Deringer, Jones Day, Linklaters and Van Bael & Bellis. We asked them to share their experiences on the involvement of economists in recent cases and their views on how the adoption of new regulations and guideline revisions are expected to affect the role for economics going forward. We also interviewed senior figures of the DG Comp’s CET. All interviews took place in June 2023.

The use of quantitative and qualitative economic analysis is growing in merger and antitrust cases

As highlighted by the interviewed law firms, economic analysis has continued to play an essential role in the assessment of competition cases in 2022. Law firms reported having involved economists in all major antitrust and merger cases they were engaged in. The CET also indicated that they continue to be closely involved in these investigations. The role of economics has been particularly important in preparing data for notifications (such as market shares, etc), in developing complex economic modelling and in supporting the parties in building and dealing with more complex theories of harm, particularly in vertical and conglomerate mergers. Many of the interviewed lawyers noted economists’ increasingly prominent role in supporting lawyers in developing and ensuring robustness of more complex theories of harm particularly in dynamic markets, such as digital markets and the pharmaceutical sector.

Recent high-profile cases such as the Illumina/Grail and Microsoft/Activision Blizzard mergers saw the integration of dynamic issues into the competitive assessment of these mergers by also considering possible harm to innovation in the market. Economists have also been increasingly involved in the assessment of remedies brought forward by merging parties to address the Commission’s concerns, particularly in the case of non-structural remedies.

Interviewees also noted that mergers and antitrust cases increasingly require the analysis of larger amounts of data. Typically, the collection and processing of data and use of appropriate analytical tools require the involvement of economists at an early stage.

These large data requirements are not unique to digital market cases but also apply to more traditional industries that are becoming increasingly data intensive. This trend has also been reflected in the establishment of a dedicated data analysis and technology unit at the DG Comp, in line with what has been done by the CMA in the UK and several national competition authorities. This is complemented by the DG Comp’s initiatives to involve financial accountants in the analysis of cases. These financial accountants help to undertake financing gap analyses in state aid cases, to assess the viability of remedies in merger investigations, and in analyses of costs and margins in the context of merger or antitrust investigations.

There is a ‘wait and see’ approach with respect to the implementation of the DMA and the assessment of sustainability claims in merger and antitrust cases

The adoption of the DMA and the new chapter dedicated to the assessment of sustainability agreements in the new Horizontal Guidelines are among the most relevant competition policy developments that took place in the past 12 months. The interviewees reported that the role of economics is yet to be clarified in these two areas.

Regarding the DMA, the interviewees noted that during the gatekeeper designation phase[1] the role for economics has been mostly limited to the assessment of quantitative thresholds.

However, there is uncertainty concerning how the law will be implemented in the future and whether DMA-related work will require collaboration with economists. Several practitioners noted that behavioural economics might play a particularly important role in ensuring that compliance mechanisms are effective and do not have the same practical result as non-compliance (eg, when designing mechanisms to avoid self-preferencing of gatekeeper’s own services). Practitioners also indicated that economists would play a role in discussions around further implementations of the obligations, especially those subject to a regulatory dialogue. This is already evident from the draft compliance reports released by the Commission, which request economic analyses designed to demonstrate compliance.

Regarding sustainability considerations, it is still unclear how they will be integrated in competition cases going forward, given the still insufficient case law.

Although the revised Horizontal Guidelines, published on 1 June 2023, contain a new chapter on sustainability agreements between competitors, the number of sustainability agreements assessed to date by the DG Comp remains low.[2] One of the focal points of the revision concerns the need to assess “collective benefits”[3] from environmental and climate gains when evaluating collaboration agreements. Indeed, economists are expected to play a key role in evaluating collaboration agreements as environmental economics offers tools to quantify collective benefits, such as the valuation of the social cost of carbon emissions.

Additionally, one area of competition law where sustainability matters have become increasingly important is State aid, where applicants need to demonstrate the environmental benefits of certain aid measures. Overall, the interviewees agreed that sustainability is still a grey area of competitive assessment, but the contribution of economists in evaluating and quantifying collective benefits will be essential.

The new Market Definition Notice will require economists to focus on digital markets and non-price-related elements

The new Market Definition Notice, whose draft was issued in November 2022, provides guidance on the principles and best practices of relevant market definition. According to the interviewees, the main novelties concern the focus on non-price-related parameters of competition such as innovation, quality, sustainability, security, availability, reliability of supply, etc.

Some interviewees have raised their concerns with the Commission’s lack of engagement with evidence on non-price-related elements of market definition. Nevertheless, interviewees generally agreed that a new focus on the assessment and quantification of these non-price-related elements of market definition will be required, and economists will play a key role in this. This is especially relevant in markets where companies compete through innovation, including through products that are still in their development phase before reaching the market (‘pipeline products’).

Input from economists will be required in relation to the FSR

Entered into force in January 2023 and started to apply six months later, the FSR aims to close a perceived regulatory gap by addressing subsidies from outside Europe that distort competition in the single market. In the context of assessing whether a foreign subsidy exists and is compatible with regulation, economics is expected to play a similar role as with assessing the existence and compatibility of state aid, although many practitioners indicated that shortcuts will likely be required for notifications, given the very large number of financial contributions that may be caught by the regime. Practitioners also noted some specificities of the FSR that will require new economic analysis, notably the assessment of the impact of these foreign subsidies in Europe and in the balancing of its benefits and the distortions caused.

While focus so far has been on the implementation of notification requirements, lawyers consider that economics will, over time, come to an increasingly important role. First, economics could be relevant in the application of the Market Economy Operator Principle to assess whether the foreign “financial contribution” from third countries has conferred a benefit to the recipient in the EU.

Secondly, practitioners highlighted the role that economic analysis will play in evaluating the subsidy’s potential distortion of competition and trade in the internal market. Finally, the FSR predicts a balancing test weighing positive effects against any identified distortion of the internal market. According to interviewees, economists will in all likelihood be engaged to undertake these balancing tests, despite the precise analytical tools and methodologies not being clear.

The new Guidance paper on Article 102 cases is not likely to have a material influence on the use of economics

One of the most anticipated changes in competition policy concerns the revision of “The Article 102 Package”. In March 2023, the Commission issued two documents (‘Call for Evidence’ and a communication amending the Guidance paper) and a policy brief. Interviewees generally agreed that the key changes in the revised Guidance paper do not constitute a strong departure from the Commission’s practice in conducting an effects-based or “economic” approach to abuse cases. Some commentators noted that the Commission’s intention to move away from a general application of the as-efficient competitor test (AEC test) for cases involving rebates could be seen as departing from the existing practice.

The more restricted role of the AEC test does not indicate that less economic analysis will be needed in the future. In fact, interviewees generally agreed that these developments indicate the Commission’s intention to rely on additional types of evidence to assess abusive conduct, including for price-related abuses such as rebates.

While the Commission stated[4] that the update was primarily designed to reflect current practice in terms of economic analysis in article 102 investigations, some practitioners indicated that these changes and the policy brief give an indication of the Commission’s desired outcome on future guidelines. Interviewees agree that, independently of the outcome of the AEC test, economics is expected to continue playing a key role in determining theories of harm and effects in these investigations.


[1] This phase refers to the process by which companies in the online platform economy are designated as gatekeepers by the Commission and subsequently qualify to fall in the scope of the DMA.

[2] We note that firms can enter agreements that they deem legal without requiring approval by competition authorities. However, our discussions suggest that firms are reluctant to do this because of the high risk of being found in infringement.

[3] “Collective benefits” are benefits that do not necessarily accrue to the users of the more sustainable product and need a horizontal agreement to internalise negative externalities to the benefit of the wider society.

[4] European Commission, 2023. Antitrust: Commission announces Guidelines on exclusionary abuses and amends Guidance on enforcement priorities. Press release 27 March 2023. Available online:

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