Antitrust Analysis of Two-Sided Platforms after AmEx: A Transatlantic View

Abstract

The US Supreme Court ruling in American Express marks a breakthrough for antitrust enforcement in two-sided markets. Not surprisingly, the ruling has sparked lively discussions in the antitrust law and economics community.

The majority of the Court argues that if both groups of players are needed to participate simultaneously for a transaction to occur, then both sides of the platform must be included when defining the relevant market. Furthermore, indirect network effects must be duly considered when carrying out antitrust analysis of transaction platforms. Hence, no inference of anti-competitive effects can be derived from price increases on one side of the platform, this being only a natural consequence of differences in the two groups’ demand elasticity. Moreover, the Court stresses the relevance of the business model when carrying out the antitrust evaluation of a commercial practice.

By drawing a comparison with the EU scenario, the paper analyses how the two-sidedness of platforms may affect the definition of the relevant market, and the assessment of competitive effects and undertakings’ business models.

Keywords: Antitrust; payment cards; two-sided platforms; market definition; business models; non-discrimination rules

JEL Classification: K21; L40; L42