Read the 10 best academic and business antitrust articles published in 2012!

Nominated by Julie Brill, Alexander Italianer, Frédéric Jenny, Bill Kovacic, Bruno Lasserre

Previous business/academic article Next business/academic article

Sponsored Entry

Alan Overd, CRA Competition Memo, January 2012.

See Alan Overd's resume

Click here to read the full article online

Some mergers materially reduce the choice of suppliers available to customers. When this happens, how much weight should competition authorities give to the potential for customers to sponsor new entry? Two recent cases investigated by the UK Competition Commission (CC) give an insight into the circumstances in which sponsored entry arguments are likely to be successful. In one case, it was concluded that the threat of customers sponsoring a new entrant was so potent that the merged firm would have no incentive to raise prices. In the other, customers were found to have shifted significant volumes to alternative suppliers following a completed transaction which raised substantial competition concerns. The CC cleared both deals without conditions.

© 2013 - Institute of Competition Law Download our brochure