The Prohibition of Price Parity Clauses and The Digital Markets Act

Platforms have imposed price parity clauses on sellers, which restrict how sellers can set retail prices. These clauses have been found to be anti-competitive in a number of recent abuse cases in and outside Europe. In particular, leading hotel booking platforms had to drop these clauses. The proposed Digital Markets Act prohibits the use of such price parity clauses for gatekeeper platforms that are addressees of the Act. I explore the economic rationale of such a prohibition and point to possi