The Law and Economics of Pass-On in Price Fixing Cases
Forthcoming, European Competition Law Review (ECLR)
18 Pages
Posted: 23 Jan 2017
Last revised: 20 Mar 2017
Case Associates; Institute of Economic Affairs
Date Written: January 21, 2017
Abstract
Sainsbury’s v. MasterCard establishes the pass-on “defence” in English/UK law. The Competition Appeal Tribunal set out a two-part test which it erroneously distinguished from the economists’ notion of pass-on. It then went on the develop key elements of legal test for pass-on in price fixing cases. This article critically assesses the Tribunal’s judgment within a law and economics framework. It provides a rounded interpretation of pass-on as both a defence and offence, the different evidentiary standards and principles used, and the potential for inconsistency which could see defendants liable to claims more than the overcharges.
Keywords: Price Fixing, Pass-On, Overcharge, Causation, Counterfactuals, Unjust Enrichment, Credit Cards, Interchange Fees, Illegal Taxes, MasterCard, EU Damages Directive
JEL Classification: D4, K0, K21, L1, L4, L11, L12, L13, K14, L41, L44, N60
Suggested Citation:
Suggested Citation
Veljanovski, Cento, The Law and Economics of Pass-On in Price Fixing Cases (January 21, 2017). Forthcoming, European Competition Law Review (ECLR). Available at SSRN: https://ssrn.com/abstract=2903208 or http://dx.doi.org/10.2139/ssrn.2903208
