The Definition of the Relevant Market and the Degree of Market Concentration in the Emerging Economies. Case Study on Brazil and Argentina
Title: The Definition of the Relevant Market and the Degree of Market Concentration in the Emerging Economies. Case Study on Brazil and Argentina
Author: BOTTA, Marco
Publisher: World Competition
Citation: World Competition, 2010, 33, 4, 661-680
The paper analyses the challenges faced by the NCAs of the emerging economies in the application of the econometric tests usually relied on in the merger control analysis. The relevant market and the degree of market concentration are usually defined on the basis of two econometric tests, namely, the Small but Significant and Non-Transitory Price Increase (SSNIP) test and the Herfindahl-Hirschman Index (HHI). Following the example of the US and the EU Merger Guidelines, the newly established NCAs of the emerging economies often refer to these two econometric tests in their merger guidelines without taking in consideration the challenges that they will have to face in applying them. The paper is a case study on Brazil and Argentina, and it aims at defining such challenges. The paper argues in favour of granting a broader margin of discretion to the NCAs of the emerging economies in applying such tests and in favour of the possibility to introduce alternative parameters to apply such tests in comparison to those ones identified by the US and the EU Merger Guidelines.
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