Market study and market investigation tools provide flexible ways to analyse competition in markets, complementing existing competition enforcement tools. Alejandra Palacios Prieto outlines how market studies tools are used in Mexico.
Amongst the powers granted to COFECE, Mexico’s Federal Economic Competition Commission, there are two tools which involve in-depth market analysis.
Market studies
One is market studies, a flexible advocacy tool by which the Commission assesses the degree of competition in a market and, when competition problems are identified, issues non-binding recommendations to address them. These studies provide a thorough understanding of market dynamics which is useful for both the Commission and external stakeholders. The knowledge acquired through a study is disseminated within the Commission and used to strengthen the knowledge base for future enforcement actions or for advocacy initiatives. Externally, these studies are a valuable resource for policymakers and public authorities on different levels of government interested in a better understanding of the markets they regulate, to recognise competition concerns and solutions to address them, and to adopt COFECE’s recommendations. However, market study recommendations are non-binding and, in some cases, may be numerous and very diverse, which could result in a low likelihood of implementation in the short term.
Potential use in digital markets
To date, the Commission has opened seven market investigations in diverse markets that have generated experiences about the use and effectiveness of Mexico’s Article 94. This has allowed the authority to establish that this tool presents several advantages that enable effective intervention in digital markets. It is precisely the special characteristics and possible advantages of Article 94 relating to digital markets that have attracted the attention of the international community. This tool is providing a point of reference in the current global debate within the competition community about the application of such market analysis mechanisms. The European Commission’s “New competition tool”[1] provides one such example.
The experience described by Mexico contributes to the debate on the use of market studies to tackle emerging competition issues at the 2020 OECD Global Forum for Competition on 10 December 2020.
[1] European Commission. Public consultations. Impact Assessment for a possible New Competition Tool, available at https://ec.europa.eu/competition/consultations/2020_new_comp_tool/index_en.html
2020 OECD Global Forum on Competition Blog Series
Blog 1: How can competition law tackle misconduct in digital markets?
Blog 2: Can market studies be a more effective tool for tackling emerging competition issues?
Blog 3: Are digital markets bringing new challenges in abuse of dominance cases?
Blog 4: Economising economic analysis for mergers in smaller markets
Blog 5: How does the UK use market studies to tackle emerging competition issues?
Blog 6: How is Mexico using market studies to tackle emerging competition issues?
Blog 7: Economics in merger control: an invaluable tool at every step of the process
On the level 