swatiraohnlu
Swati Rao
In competition law, before deciding whether companies have significant market power which would justify government intervention, the test of Small but Significant and Non-transitory Increase in Price (SSNIP) is used to define the relevant market in a consistent way. It is an alternative to ad hoc determination of the relevant market by arguments about product similarity.
The SSNIP test seeks to identify the smallest relevant market within which a hypothetical monopolist or cartel could impose a profitable significant increase in price. The relevant market consists of a 'catalogue' of goods and/or services which are considered substitutes by the customer. Such a catalogue is considered "worth monopolising" if should only one single supplier provided it, that supplier could profitably increase its price without its customers turning away and choosing other goods and services from other suppliers
The SSNIP test seeks to identify the smallest relevant market within which a hypothetical monopolist or cartel could impose a profitable significant increase in price. The relevant market consists of a 'catalogue' of goods and/or services which are considered substitutes by the customer. Such a catalogue is considered "worth monopolising" if should only one single supplier provided it, that supplier could profitably increase its price without its customers turning away and choosing other goods and services from other suppliers