Discussion papers for download

See our publications page for a fuller list of publications, including Reckon reports that our clients have decided to make publicly available.

The following discussion papers published by Reckon are available for free download:

Reverse charging to prevent VAT fraud
December 2006

This brief paper comments on the potential impact of reverse charging in VAT on Missing Trader Intra-Community (MTIC) fraud, and on the compliance burden to businesses. The paper is motivated by recent efforts by the UK, Germany and Austria to introduce reverse charging as a means to combat VAT fraud. It argues that while the UK's proposed changes are likely to eliminate carousel fraud within certain product categories, the effect on acquisition fraud and on black market fraud is uncertain.

Download (2 pages, PDF)Discuss on Reckon Open

Comment on Minister's Brisa/AEO merger decision
June 2006

This brief paper comments on the decision by the Portuguese Economics and Innovation Minister to allow the merger of the motorway operators Brisa and Auto-Estrada do Oeste (AEO) on the grounds that this will spur Brisa's efforts to innovate and improve Brisa's ability to compete internationally, and that both of these effects are in the national interest. The paper argues that there are gaps in the Minister's reasoning. No evidence is put forward to suggest a link between the merger and either of these effects. In addition, the decision has not examined whether allowing the merger is proportionate to the objective of improving Brisa's performance. The paper also notes some shortcomings in the decision's analysis of the effects of the merger on competition.

Download (2 pages in Portuguese, PDF)Discuss on Reckon Open

Proposed revenue adjustment scheme to address uncertainty in electricity transmission investment
November 2005

This brief paper, prepared as part of the review of electricity transmission charges in Great Britain from 2007, suggests a possible way of addressing uncertainty in investment requirements. The proposed scheme is designed to minimise the costs borne by consumers as a result of the need to reinforce transmission networks to connect new generators, particularly renewables. It seeks to limit the increased financial risks borne by companies, and the resulting financeability costs to consumers, whilst maintained the strong and consistent incentives for efficiency arising from an RPI-X price control coupled with a rolling pass through mechanism.

Download (5 pages, 129k PDF)Discuss on Reckon Open

State aid law and the BBC Charter review: contestable
funding by the back door
November 2005

The Government's Green Paper on the renewal of the BBC's Royal Charter proposed reforms to the governance of the BBC. In this article, Reckon partner Nicholas Francis examines the proposals in the light of the European Union's rules on State aid, and finds a conflict. Despite the high degree of subsidiarity that is recognised in the application of State aid law to public service broadcasting, the halfway house reflected in the proposals is unlikely to be compatible with State aid law. This could set the BBC on a collision course towards a contestable funding model — an outcome completely at odds with the Government's stated policy.

Download (4 pages, 216k PDF)Discuss on Reckon Open

Unfair competition?
Last revised November 2005

Unfair competition? is a guide to complaining about anti-competitive conduct or regulations in the UK. It highlights the strengths of the existing competition laws and some potential weaknesses of the enforcement regime, and describes Reckon's attempt at addressing these weaknesses through an affordable complaint handling service. This guide provides general information believed to be correct at the time of publication. It is not a full substitute for professional or legal advice tailored to particular circumstances.

Download (2 pages, 140k PDF)Unfair competition? website

When assumptions go unquestioned
November 2004

Data Envelopment Analysis (DEA) is a technique to estimate the production function of a set of relevant units on the basis of the levels of inputs used and outputs produced actually observed. The paper discusses the assumptions underlying the more familiar models of DEA and emphasises that, at the peril of drawing invalid inferences, the analyst must justify those assumptions. In applications to the UK water and electricity distribution, such justifications are typically not given and the paper finds grounds to argue that some of these assumptions are in fact not satisfied.

Download (24 pages, 1.5M PDF)Discuss on Reckon Open

On Genzyme
October 2004

Reckoning "On Genzyme" discusses aspects of the Competition Appeal Tribunal's judgment in the Genzyme case (March 2004). Genzyme, a pharmaceuticals manufacturer, was found to have infringed Chapter II of the Competition Act by conducting a margin squeeze against a downstream supplier of homecare services. The paper explains that the likely competitive effects of Genzyme's conduct do not tally with the theory of abuse implied in the Tribunal's decision. It then argues that, because of this, the Tribunal missed an important opportunity to clarify a problematic area of the law on abuse of dominance.

Download (13 pages, 900k PDF)Discuss on Reckon Open

Water mergers
September 2004

This article argues that the Competition Commission's draft guidelines on water mergers risk focusing too much on the value of comparators to Ofwat. There are other effects which ought to be considered, including the potential lessening of competition in markets for corporate control; the risk that an unduly restrictive approach to merger control could itself impede competition in markets for corporate control; and the value of comparative information to the industry (and ultimately to consumers) over and above its value to Ofwat.

Download (4 pages, 295k PDF)Discuss on Reckon Open

The iTunes Music Store: does competition law hold the key to a closed shop?
September 2004

This article considers the scope for challenging Apple's apparent decision not to license its digital rights management (DRM) technology FairPlay to competitors of the iTunes Music Store. Drawing on the ECJ's guidance in the recent IMS case, we consider the conditions under which EC competition law (Article 82) may require Apple to license FairPlay to other retailers of music downloads to enable head-to-head competition in the supply of downloadable music content to iPod users.

Download (4 pages, 383k PDF)Discuss on Reckon Open

Cross-promotion on TV: time to change the rules?
August 2004

Ofcom inherited its rules on cross-promotion by commercial TV broadcasters from the Independent Television Commission (ITC). These regulations seek to achieve a balance between the information benefits of cross-promotion, the concern that promotions may irritate and confuse viewers, and the risk that excessive cross-promotion damages competition. This article argues that these rules should now be reviewed, and proposes a change in the nature of the regulations to enhance both competition and information provision.

Download (2 pages, 158k PDF)Discuss on Reckon Open

Reckon LLP is an economics consultancy with expertise in data analysis, economic regulation and competition law.

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