Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

Thursday, April 1, 2021

The Rebate Effect: An Attempt to Measure the Effects of Loyalty Discounts on the Competitive Process

The Rebate Effect: An Attempt to Measure the Effects of Loyalty Discounts on the Competitive Process

Pedro Rencoret

Pontifical Catholic University of Chile; Independent

Abstract

The discussion regarding what should be the proper legal treatment for loyalty discounts (also known as “fidelity discounts” or “loyalty rebates”) in antitrust law is characterized by a strong lack of consensus among enforcement authorities and scholars, being no agreement as to whether it entails a procompetitive business practice or an illegal means of distorting competition. This paper aims making a contribution to the debate by offering a modest empirical analysis of the decision that the Competition Court of Chile (Tribunal de Defensa de la Libre Competencia or “Competition Court”) issued in the case Canada Chemicals v. Compañía Chilena de Fósforos (the “matches case”), which found the loyalty discounts anticompetitive.

https://lawprofessors.typepad.com/antitrustprof_blog/2021/04/the-rebate-effect-an-attempt-to-measure-the-effects-of-loyalty-discounts-on-the-competitive-process.html

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