1. Competition Economists Roundtable “Antitrust: Theory & Practice” Hideyuki SHIMOZU Senior Officer for Mergers and Acquisitions, Japan Fair Trade Commission 2nd ATE Symposium December 15-16, 2014 - Sydney, Australia 1 The views and opinions expressed in this presentation are thoes of the author and do not necessarily reflect the views or policies of the JFTC.

2. 2 Company A Company B Problems of market foreclosure, exclusivity A+B Buying Power Brand Credibility Marketing Technology Company A Company B A+B Company C Company D Company E a&ba&b a&ba&b a&ba&b Bundling /Tying Increasing the overall business capabilities of the company A+B Conglomerate business combinations (1)

3. Disappearance of potential competition Compan y A Company B Market A Market B Market A Market B A+B Disappearance of potential entry pressure Potential Entry Pressure 3 Conglomerate business combinations (2)

4. 4 Issues on Conglomerate business combinations Empirical studies on the following would be useful in practice of law enforcement;  How should we define “overall business capabilities”?  How do we estimate “overall business capabilities”?  If there is a case that raises competitive concerns in terms of “overall business capabilities”, what kind of case would it be?  If there is a case that raises competitive concerns in terms of “overall business capabilities”, what kind of remedies would fix those concerns? Retrospective studies on the past conglomerate business combinations also would be useful.

5. Business combination in two-sided market 5 Contents Company A Digital Platform Company X Consumers Digital Platform Company Y ・・・ Network Effect Goods/services Possible business combinations: A+X, X+Y

6. 6 Issues on business combinations in two-sided market Empirical studies on the followings would be useful in practice of law enforcement;  How to define the appropriate market  How to deal with network effect in assessing the impact of the business combinations on competition  Are there special considerations when reviewing business combinations related to digital platforms, as compared to non-digital platforms such as newspapers  If there is a case that raises competitive concerns, what kind of remedies would fix those concerns?