56 COMPETITION LAW IN TOURISM There are multiple competitive risks related to the MFNs. First, they may fuel industry-wide price uniformity, to the detriment of consumers, by leading the service providers to lower their price at any of their sales channels182. In the same vein, the MFN clauses may soften retail price competition between existing OTAs183. Furthermore, “wide” MFNs may enlarge barriers to enter the market, and the OTAs entering the market will not be able to have lower prices than the incumbents. Hence, parity clauses may become a tool for foreclosing the market. In addition, the platforms may even develop an incentive to increase their commission, as it is disconnected from the final price184. At the same time, these clauses could be economically justified because of their offered protection of the intermediaries’ investment in a reliable platform and reduction of the risk of free-riding185, which occurs if one platform is making pre- -contractual investments, such as supplying information, and the customer eventually goes onto another platform186. Since consumers generally benefit from improved information flows and reduction in search costs, brought by OTAs, the latter’s incentives to innovate187 should be an important factor in competition analysis. In academic debates, multiple legal issues emerge, for example, there is an ongoing debate on whether the MFNs can be classified as genuine agency agreements, renderingArticle 101TFEUinapplicable to them. Plus, if competition rules do apply to them, the debate is open on whether parity clauses restrict competition by object or effect188. Possible justifications of the practice under Article 101(3) TFEU are also contemplated. There is also a discussion on the possible horizontal qualification of MFN clauses. This could be the case when the platform sells own products while also concluding agreements containing MFN clauses with its direct competitors, i.e. the suppliers on the same platform189. 182 Ariel Ezrachi, The competitive effects of parity clauses on online commerce, European Competition Journal 2015, p. 489. 183 Frisco Bostoen, Most Favoured Nation Clauses, supra note 52, p. 229. 184 Pablo Solano Diaz, Price parity clauses: has the Commission let slip the watchdogs of war?, European Journal of Legal Studies 2016, Vol. 9(1), p. 48); See also: Pinar Akman, A competition law assessment of platform most-favored- -customer clauses, Journal of Competition Law & Economics, Volume 12, Issue 4, 1 December 2016, p. 781-833, https://doi-org.coleurope.idm.oclc.org/10.1093/joclec/nhw021, p. 829. 185 M. Colangelo, Parity Clauses and Competition Law in Digital Marketplaces, supra note 53, p. 5. 186 Simon Bishop, Mike Walker, The Economics of EC Competition Law: Concepts, Application and Measurement, London, Sweet & Maxwell, 2010, p. 196. 187 See: OECD, Vertical Restraints for On-line Sales (2013), available at: http://www.oecd.org/competition/ VerticalRestraintsForOnlineSales2013.pdf, p. 23. 188 See, e.g.: Amelia Fletcher, Hviid Morten, Broad retail price MFN Clauses: are they RPM “at its worst”?, Antitrust Law Journal 2016, p. 65-98. 189 Frisco Bostoen, Most Favoured Nation Clauses, supra note 52, p. 228.
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