DOI: 10.32609/j.ruje.10.117650

Authors: Andrey E. Shastitko, Olga A. Markova, Anton N. Morozov

Abstract: Platform pricing may be connected to antitrust risks, which a company can face under excessive or predatory price scrutiny when the platform is recognized as dominant in the market. Since Federal Antitrust Service of Russia (FAS Russia) prefers price-cost comparison when studying excessive or predatory pricing, we suggest using tariff regulation approaches when analyzing platform prices and calculating long-run average incremental costs (LRAIC). By using this approach one can reduce the risks of simultaneously perceiving platform prices for functionally different consumer groups as predatory and excessive. Having identified antitrust risks of platforms changing their prices (both downward and upward), we show that price increase within the inflation rate may be preferable from the point of view of possible antitrust risks and the transaction costs of interactions with the antitrust authority. However, this method of antitrust compliance could potentially conflict with the company’s long-term development goals as a platform.

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DOI: 10.32609/j.ruje.8.82144

Authors: Andrey E. Shastitko, Olga A. Markova, Anton N. Morozov

Abstract: Could identical goods sold by the same company on the same territory and at the same time be attributed to different product markets? In our paper we take a closer look at the case of the wrought-steel wheel industry, which became the subject of an antitrust investigation initiated by the FAS Russia in 2020. During a shortage, one of the largest wrought-steel wheel producers sold small batches of wheels to minor buyers at relatively high prices compared to the industry average. FAS Russia assumed this price difference to be evidence for abuse of market power. In contrast to FAS Russia’s conclusions, we suggest that wrought-steel wheels sold to major and minor buyers constitute at least two separate markets. To test this hypothesis, we define a relevant product market employing a price correlation analysis. To conduct robustness check we also provide a stationarity test on the log price ratio and a cointegration test which fall within the results of correlation analysis. As consumers actually did engage in side transactions, the revealed price difference is not related to price discrimination. We explain this price difference using the new institutional economics, assuming that goods sold to a large buyer do possess special transaction characteristics which do not meet the characteristics of the batches consumed by minor buyers. Another explanation is differences in bargaining power between large and minor buyers. Our result shows that there can be identified at least two wrought-steel wheel product markets: one with Russian Railways as the main buyer and the second one with smaller undertakings.

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DOI: 10.32609/j.ruje.6.53904

Authors: Natalia S. Pavlova, Andrey E. Shastitko, Alexander A. Kurdin

Abstract: Digital antitrust is at the forefront of all expert discussions and is far from becoming an area of consensus among researchers. Moreover, the prescriptions for developed countries do not fit well the situation in developing countries, and namely in BRICS: where the violator of antitrust laws is based compared to national firms becomes an important factor that links competition and industrial policy. The article uses three recent cases from Russian antitrust policy in the digital sphere to illustrate typical patterns of platform conduct that lead not just to a restriction of competition that needs to be remedied by antitrust measures, but also to noteworthy distribution effects. The cases also illustrate the approach taken by the Russian competition authority to some typical problems that arise in digital markets, e.g. market definition, conduct interpretation, behavioral effects, and remedies. The analysis sheds light on the specifics of Russian antitrust policy in digital markets, as well as their interpretation in the context of competition policy in developing countries and the link between competition and industrial policies.

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DOI: 10.32609/j.ruje.6.50122

Authors: Yannis Katsoulacos, Natalia S. Pavlova, Andrey E. Shastitko

Abstract: Telecom companies are a frequent target of antitrust investigations in Russia. In an industry where services tend to become more and more complex and companies actively invest in diversifying their businesses, the antitrust authority in most of its telecom cases has chosen to define markets narrowly, which increases antitrust risks for the companies. This paper uses poll data on mass SMS notifications — a market in recently investigated by the FAS Russia — to demonstrate, using critical loss analysis, that the market should be defined in broader terms. In particular, the main empirical finding is that the relevant product market boundaries should cover not only SMS, but also email, messengers and push and voice notifications.

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