Covid-19 and Competition Law
16th April 2020
On Sunday 17 November 2019 in Wuhan, Hubei province, South China, the first case occurred of someone suffering from corona virus. It is a virus so new that in the beginning it didn’t even have a name. Today it is identified as Covid-19, Co (from corona) vi (from virus) and 19 referring to the year in which the first case was registered. The virus is of course responsible for the pandemic that we are living through.
At Oxford Competition Law, we are aware of how the competition authorities around the world are making the best possible effort to keep an eye on the markets. We are also seeing incredible situations, such as Comcast, Charter, Verizon, Google, T-Mobile, and Sprint signing a pledge to continue to provide internet connectivity. Luxury goods conglomerate LVMH, the parent company of Christian Dior, Guerlain, and Givenchy, is helping the French health authorities by manufacturing hand sanitizer and providing it to them for free. General Motors is working to procure 100,000 ventilators by the end of June, along with tens of millions of personal protective equipment units. Zara, Nivea, and Dyson are making sweeping changes to their business models in a frantic effort to assist with the response to the Covid-19 outbreak and to survive the crisis without going bust. The engineering firm Meggitt said it was leading a group of firms contributing to a drive to produce tens of thousands of ventilators to treat patients who develop respiratory problems.
The virus is one dominant enough on the one hand to put the world in a lockdown, and on the other hand to supercharge basic hygiene markets, like those for soap and hand sanitizer, and to create new hygiene/technology markets that may become the new essentials. The virus raises many questions around what the exit path from the lockdown will look like, how the markets will restructure, how companies will survive or merge in response to the crisis, how technology will jump, whether companies are abusing their market structure or dominance, or whether they will after the exit path starts. There are further questions regarding a whole host of issues, including: the reopening of stores; potential new ways of engaging in commerce; the codes for physical distancing; remote working as normal phenomenon; physical meetings becoming exceptional; the final decline of old banking and the increasing dominance of FinTech and e-banks; the disappearance of physical money and migration to all kinds of forms and names of electronic money, cryptocurrencies, and new forms to come; the transformation of medicine, medical consultations, treatments, and surgeries; and the new ways of supply and distribution - just to mention some markets.
Covid-19 will pass, as is the case with any other crisis. The world will continue, and the economy and the markets will find their way through. We must free ourselves from any unwarranted dogmatic ideas in order to understand and respond to the new market situations that are brewing, and to the formation of totally new structures with new practices and new forms of dominance.
The views expressed herein are those of the author.