Singapore: Adopted CCCS Guidelines on Market Definition

On 21 December 2021, the Competition and Consumer Commission of Singapore (CCCS) adopted revised guidelines on Market Definition. The guidelines offer details on market definition issues relevant to the digital age. The guidelines provide the analytical framework on how the CCCS may define markets when investigating possible infringements of section 34 and 47 prohibitions under the Competition Act 2004. Market definitions enable the CCCS to identify the competitive constraints that affect the undertakings involved and allow it to assess the effects of potentially anticompetitive activity on competition. Specifically, for multi-sided platforms, the CCCS may consider additional factors, such as the appropriate theories of harm and the interactions between different sides of the platform on a case-by-case basis. The CCCS may define the relevant market as either a single multi-sided market or multiple interrelated single-sided markets when conducting the hypothetical monopolist test, depending on specific competition concerns and market interactions. When applying the test to a multi-sided market, the CCCS may consider indirect network effects and usage externalities, which arise from interactions and dependencies between users on different sides of the platform. Indirect network effects refer to the platform's value to one side depending on the number of users on the other side, while usage externalities refer to costs or benefits accruing to one side due to usage on the other side. Additionally, the CCCS may assess how changes in the price structure affect the hypothetical monopolist's ability to sustain a "supra-competitive" pricing strategy. In cases where a platform does not charge a positive price to users on one side, the CCCS will still consider the effects on that side. The analysis may include non-monetary aspects such as data security, ease of use, and innovation, depending on the facts of the case and the industry concerned.