When Should an Incumbent be Obliged to Share its Infrastructure with an Entrant Under the General Competition Rules?

Author: Bergman, Mats

Source: Journal of Industry, Competition and Trade, Volume 5, Number 1, March 2005 , pp. 5-26(22)

Publisher: Springer

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Abstract:

According to the essential-facilities doctrine, competition law requires an infrastructural monopoly to provide access. Under the “Bronner criterion”, proposed by the EC Court, the doctrine is only applicable when a symmetric infrastructural duopoly is non-viable. This paper uses a simple model to illustrate that, from a welfare point-of-view, the Bronner criterion may provide too little monopoly protection for the incumbent in high-risk new markets, while requiring too much investments from the entrant in low-risk mature markets.

Keywords: infrastructure; access regulation; competition law; antitrust; bronner

Document Type: Research article

DOI: http://dx.doi.org/10.1007/s10842-005-0990-7

Affiliations: 1: Swedish Competition Authority and Department of Economics, Stöckhölm University College, SE-14189, Huddinge, Sweden, Email: mats.bergman@sh.se

Publication date: 2005-03-01