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Alleged foreclosure effects between taxi drivers and cabs dispatching systems

Lear assisted the largest cab dispatching company in the city of Rome, Radiotaxi 3570, in the proceedings before the Italian Competition Authority.
The Italian Competition Authority (ICA) has investigated into the top three cab dispatching companies operating in Rome. The three companies are indeed “cooperatives”, whose members are taxi drivers associated with only one of the cooperatives under a bilateral non-compete agreement, implying that the cab drivers cannot accept calls for service from any competing dispatchers and each dispatcher only sends service requests to its own associates.
The investigation was based on a complaint filed by Mytaxi, a German company owned by Daimler AG, that is active in the taxi market of Rome with its web mobility platform (a separate investigation is underway for the city of Milan, because of the local definition of the relevant markets). The claim was that the foresaid non-compete clauses would limit the ability of Mytaxi to match a greater share of demand for taxi service it receives from platform users, because such clauses would limit the expansion of the Mytaxi’s network of cab drivers.
Lear’s economic analyses showed that: ICA’s evaluations were inconsistent with the theory of harm that prompted the investigation, were based on unreliable data and provided inconclusive evidence on the alleged relationship between the dispatching service performance of Mytaxi and the existence of the foresaid non-compete clauses, that are necessary for the cooperatives’ business model.