Competition Law in Tourism

518 COMPETITION LAW IN TOURISM are often introduced in order to minimise externalities and facilitate investment. Operating behind the scenes of online commerce parity clauses are also known as “most-favoured-nation clauses” (MFNs). The discussion begins by 1) considering the economic rationale for price parity clauses and 2) the welfare benefits they may generate. The increase in retail prices all buyers face as a result of intermediation cancels out the extra benefits they obtain [from that intermediation] (Edelmen, 2015). If buyers could coordinate, they would consider the higher price that results from their individual decisions to join the intermediary and, collectively, they would prefer not to join the intermediary (Edelman & Wright, 2015). Buyers participate, even though they are jointly worse off from doing so, due to coordination failure. Features of the e-commerce sector which are relevant to any assessment of the competitive dynamics within it include the wide availability of information and knowledgeable consumers, innovation and efficiency, low barriers to entry and expansion and, finally, a diversity of providers and alongside disruptive innovation. Having discussed the adequate scope of competition law intervention, one should be mindful of other enforcement tools at the disposal of the State (Ezrachi, 2015). The competition law regulating the activities of operators in the market has significant importance, considering that this field of law establishes regulation of competition between competitors in the market. The emergence of new accommodation and transport systems that are affected today by what is called “shared economy” has particular significance in this area. There are five principles that should guide the assessment of unilateral conduct in the e-commerce sector: 1) antitrust enforcement should be based on sound economic principles and follow existing case law wherever possible; 2) it is essential to take an evidence-based approach to enforcement by considering actual market developments over the period since the allegedly abusive conduct began; 3) in dynamic and innovative sectors, a consideration of a well-defined and realistic counterfactual can help improve decision-making; 4) enforcement should take place by reference to equally efficient competitors; and 5) it is useful to seek to understand the business justification for a given form of conduct at an early stage in any investigation, given the often new and innovative nature of business models in the e-commerce sector.

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