The Effect of the Interpretation of Company Behavior on the Analysis of Market Boundaries

Abstract

The analysis of the state of competition in commodity markets is formally regulated by Order No. 220 of the Federal Antimonopoly Service of Russia dated April 28, 2010 “On Approval of the Procedure for Analyzing the State of Competition in the Commodity Market”, but in reality, the mechanical adherence to the norms of this document is not enough, since all stages of the analysis, explicitly or implicitly, are based on a certain interpretation of the relationship and behavior of the defendant, the applicant and other affected persons. A vivid illustration is the situation with the provision of wired Internet services for tenants in shopping and entertainment centers. The relevance of this issue is ensured by the presence of antimonopoly cases, which consider the compliance of the provision of such services with antimonopoly legislation. The purpose of the study is to reveal, using the example of the markets for renting premises in shopping and entertainment centers and Internet communications, how the interpretation of the company’s behavior determines the approaches to assessing the boundaries of relevant markets. For this, alternative interpretations of the relationship and behavior of Internet providers (telecom operators), owners of shopping and entertainment centers and tenants are presented; grounds for the proposed interpretations are given; the consequences of applying alternative interpretations to identifying relevant markets and their further analysis in accordance with the requirements of the legislation are described; the key questions for research are highlighted, which can allow one to compare alternative interpretations and choose the one that best corresponds to the essence of the analyzed economic relations. As a result, we show that the analysis cannot ignore the connection between communication services providers, tenants as purchasers of communication services, and owners of shopping centers. Alternative interpretations of this connection are possible from the point of view of the economic essence of these relations and relevant theoretical concepts, but in any case, its economic nature should be studied, including for the purposes of the correct application of legal norms to assess the state of competition in the affected product markets.