When Information is Not (Market) Power

Using quantitative techniques to show that information exchange did not facilitate collusion

On January 2015, the French competition authority claimed that some car rental companies infringed competition law by sharing monthly information related to revenue, number of contracts signed, market shares and average contract value at twelve airports in France. The Authority was concerned that this information exchange could facilitate collusion.

Compass Lexecon examined the rental companies’ behaviour and market outcomes. We showed that the information exchanged did not provide a reliable basis for coordination, that the rental companies did not appear to use the information as the Authority’s theory predicted and that information exchanges did not cause changes in market outcomes. This led the Authority to drop its objections. Find out how we showed that, in this case, information exchange did not facilitate collusion.

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