Competition Law and Policy in Mexico: A Comparative Analysis

Competition Policy in Mexico vs. the European Union

Statement: There is a popular belief that competition policy in Mexico is oriented towards consumer protection. However, this is not the case. This criterion differs from that proposed by the European Union, which does consider consumer protection among the pillars of its competition policy.

Question: What is the main orientation of competition policy in Mexico, and how is it different from other jurisdictions? Consider at least one jurisdiction other than Mexico in your interpretation.

Answer: Consumers are the ultimate beneficiaries of competition policy. In an environment of effective competition, companies strive to be better than their competitors and, therefore, win customers, reduce their prices and increase the quality of their products or services. Through innovation and technical progress, the welfare of consumers is improved.

Elements of Collusion in Anti-Competitive Conduct

Statement: Among the anti-competitive conducts that exist, collusion is considered to have the greatest impact on the market. However, there may be market failures that do not necessarily arise from this practice, so it is important to know the elements that make it up.

Question: What are the necessary elements to prove collusion? Provide a brief example.

Answer:

1. An agreement between competitors

2. The object or purpose

3. The will (la voluntad) and joint decision to carry out the agreement to produce some opposite effect to free competition

Example: Independent companies agree on price rises.

Defining Relevant Market and Substantial Power in Monopoly Analysis

Statement: The definition of the relevant market and substantial power constitutes an essential stage of the analysis in matters of competition, specifically for the accreditation of possible relative monopolistic practices.

Question: What elements are necessary for the definition of the relevant market and substantial power?

a. Substantial Market

1. Market share and ability to fix prices unilaterally without competitors being able to counter such power.

2. The existence of barriers to entry.

3. Competitors’ existence and power.

4. The Economic Agent(s)’ and their competitors’ possibilities to access input sources.

b. Relevant Market

1. Product-Service: Defining the market from the possibility of substituting the good or service in question for others.

2. Geographic: Defining the market from its location (distribution costs, consumer costs of accessing other markets for the same good, regulatory restrictions).