Restrictions on Innovation in EU Competition Law

Abstract

This paper discusses, in light of the practice of the European Commission, the different ways in which innovation considerations can be introduced in EU competition law. In some cases, such considerations have played an indirect role in the analysis. These are instances in which harm to innovation has been presumed or inferred by proxy from the effects of a practice on the competitive process (for instance, the foreclosure of a rival or the creation of a near monopoly). It is difficult to see anything controversial, or parameter-specific, in these cases. They reflect the approach to contemporary enforcement, which revolves essentially around the analysis of markets and does not require direct evidence of the impact of a practice on, inter alia, prices, output or product quality. Innovation-related arguments may also be introduced as an alternative to the orthodox approach to enforcement. For instance, they may be introduced in lieu of foreclosure analysis in a case where intervention requires evidence of an exclusionary effect. Instead of showing that the practice would lead to foreclosure, the authority or claimant would claim that the practice reduces the rate of innovation. It is submitted that there is no room in EU competition law for the direct introduction of innovation considerations.