Closing the Algorithmic Gap: Rethinking Dynamic Pricing under Articles 101 and 102 TFEU

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Abstract

This paper is concerned with regulation of dynamic pricing algorithms under the EU competition regime. We show that the competition rules as presently interpreted fail to inadequately capture the harm to consumer welfare that dynamic pricing algorithms may cause. This creates an enforcement “gap” in a competition regime which purports to protect consumer welfare. We then argue the existing rules need to be slightly reframed, if such algorithmic practices are to be effectively controlled. This reformulation includes regarding coordinated price elevation as a concerted practice which Articles 101 and 102 TFEU can interdict, viewing price elevation in algorithmic markets as a form of tacit collusion and as a breach of dominant undertakings’ special responsibility not to further weaken competition in a market. Our suggestions are consistent with existing Article 101 and 102 TFEU case law and allow for a more effective response to any welfare reducing threat found in algorithmic markets.

Bibliographical metadata

Original languageEnglish
Pages (from-to)122- 131
Number of pages10
JournalCoRe: European Competition and Regulatory Law Review
Volume5
Issue number2
DOIs
Publication statusPublished - 11 Jun 2021