Abstract

The Italian Antitrust Authority decision concerning predatory pricing and abusive practices in the postal market by the Incumbent Poste Italiane has been recently annulled on appeal by the Tar (Italian Administrative Court). The paper criticizes the relevant market definition provided by the Authority. According to the 2001 European Commission that originally defined it, the postal market where competitors supply their services is separated from the universal service market if their provision includes some value added features. The main drawback of this definition is that the incumbent, although holding more that 77% of share in the contestable market, is formally not dominant, therefore not charged by special obligations to not reduce competition. The paper suggests to charge Agcom, the newly appointed independent postal regulatory Authority, to adjust the relevant market definition in the light of true substitution and cross elasticity effects.