The Essential Facilities Doctrine: The Lost Message of Terminal Railroad

Stephen M. Maurer and Suzanne Scotchmer

No 14-476, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: The growing importance of shared networks, shared platforms and shared standards leads to a renewed discussion of the essential facilities doctrine of antitrust. This is an area where European law and American law have diverged. In Trinko (2007), the U.S. Supreme Court came close to abolishing it. At the same time, it was reinvigorated by the European Commission, which asserted it successfully in E.C. v. Microsoft, and then, facing criticism, clarified the doctrine in a Guidance document. We harmonize the main cases around the doctrine’s original but often forgotten purpose namely, harvesting economic synergies through sharing. We argue that, absent such a doctrine, these synergies could be lost as firms either avoid sharing to avoid antitrust liability, or create sharing arrangements that undermine competition. We show how and why the original purpose of the doctrine has become entangled with other antitrust issues, in particular, leveraging. We systematize the sharing rules that have been imposed or allowed, with an emphasis on how to harvest synergies while mitigating any harm to competition.

Keywords: Competitions policy; antitrust; Sherman Act; essential facility (search for similar items in EconPapers)
JEL-codes: K21 L40 L41 (search for similar items in EconPapers)
Date: 2014-03
New Economics Papers: this item is included in nep-com, nep-law and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:27978

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