Mergers Without Markets? Unilateral Effects Analysis in the United States and its Prospects in Australia

Caron Beaton-Wells
(2006) 34 ABLR 186; [2006] University of Melbourne Law School Research Series 6

Abstract

'In both the United States and Australia an initial but crucial step in the analysis performed for the purposes of merger regulation has been definition of the relevant market(s) in which competition may be affected. In recent years, the federal agencies in the United States have adopted an approach that excludes this step. Instead, their approach has been to examine the potential unilateral effects of a merger by assessing “directly”, using empirical techniques, the possibility of a supra-competitive price increase by the merged firm. This has been seen as a preferable approach in many ways to the traditional structural analysis to which market definition is integral. Is it likely that Australian regulators and courts would adopt a similar approach? This article addresses that question, concluding that there are good reasons for regarding such a prospect as remote.'

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