The emerging strategy of the European Commission on long-term energy supply contracts : is the new methodology truly 'more economic'?

Abstract

This paper aims to assess the emerging strategy of the European Commission on long-term supply contracts in the light of the recent modernisation of EU competition law, in particular with regard to the so-called ‘more economic’ approach. In short, the modernisation aimed at implementing a ‘more economic’ approach based on long-term consumer welfare, which meant gradually shifting from a more (allegedly) legal ‘forms-based’ analysis of contracts to a more ‘effect-based’ approach where the real economic effects of competitive behaviours become more important than the drafting of contracts. The analysis of the recent line of cases shows that a multiple-step approach to analyze long-term supply contract under the competition rules is currently emerging. Among these steps, the economic accuracy and the potential in terms of predictability has been found to diverge widely. The analysis of these steps evidenced that the ‘more economic’ approach should not be interpreted solely as an attempt to integrate more economic analysis but rather as an attempt to better conciliate economic analysis, predictability and the limitation of regulatory costs.