The proposed market definition regulations mark the first revision of the rules since 1997.
EU regulators announced that they intend to issue an update to the Commission’s ‘Market Definition Notice’, a set of guidelines that regulators use to determine a company’s relative power to control the market in which they operate.
The new draft of the Market Definition Notice has been submitted for public consultation, and “all interested parties” are invited to comment. According the European Commission, the process marks the first revision to the document since its adoption 25 years ago.
The Commission says that the new version will take into account the significant developments of the intervening years, such as “the digitalisation and new ways of offering goods and services.”
In other words, the regulators are finally girding themselves to take on the challenges posed by big tech and their sway over all things online.
What changes are proposed?
The main objective of the new Market Definition Notice is to offer more guidance, transparency and legal certainty surrounding compliance, the Commission explains. It also seeks to contribute to “a more efficient enforcement” by the Commission and National Competition Authorities.
The proposed changes provide new and additional guidance on various key market definition issues, such as explanations of the principles of market definition and the way market definition is used to apply competition rules.
The commissioners also want to place greater emphasis on “non-price elements” such as innovation and quality of products and services.
Most importantly, the new rules will offer guidance in relation to market definition in digital markets, such as multi-sided markets and ‘digital eco-systems’. The new rules will also clarify how markets should be assessed when companies compete on innovation.
Another aspect that they intend to clarify is geographic market definition. The rules explicitly state the conditions for defining global markets. They will also define the Commission’s approach to assessing imports in the context of “local markets defined by catchment areas (e.g. in the retail sale of consumer goods)”.
The Commission expected to finalise its proposal in the third quarter of 2023.