Relevant market

[2] In the United States, there exist a set of merger guidelines—written by the Antitrust Division of the Department of Justice (DOJ) and the Federal Trade Commission (FTC)—which specify methods for analyzing and defining markets.

Since 1980, the DOJ and the FTC have used these guidelines to convince courts to adopt a more explicitly economic approach to antitrust policy.

[5] The revised Notice includes changes to take into account substantive, methodology, and evidence challenges in the context of digital markets and innovative industries, which have been an ongoing subject of discussion and scholarship.

If consumers are in a position to switch to available substitute products or to begin sourcing their requirements from suppliers located in other areas, then it is unlikely that price increases will be profitable.

Therefore, a small but significant number of consumers (generally 5 to 10 percent) switching to another product when there is a price increase is considered a sufficient condition for both goods to be defined as forming part of the same relevant market.

Therefore, the existence of a group of consumers who would never switch in response to a relative price increase is not by itself sufficient to conclude that the relevant market should be defined narrowly.

The elements to be taken into consideration when defining the relevant geographic market include the nature and characteristics of the concerned products, the existence of entry barriers, consumer preferences, differences among the market shares of undertakings in the neighboring geographic areas, as well as significant differences between suppliers’ prices and transport costs level.