§3.2.1.3 Evidence of hypothetical substitution

54. The Commission may also rely on information about how customers are likely to react to hypothetical changes in relative supply conditions (‘hypothetical substitution’). Reasoned answers of customers and competitors regarding such hypothetical substitution can be informative for identifying substitute products. In some cases, evidence of hypothetical substitution may also be available from surveys of a representative sample of customers. Evidence of hypothetical substitution may constitute the only available direct (quantitative) evidence of demand substitution and may be informative for the assessment. Nevertheless, evidence of hypothetical substitution may be less reliable than evidence of actual substitution, for example because hypothetical demand substitution has no actual consequences for customers or because of other behavioural biases. In particular, views of market participants relating to the likelihood or magnitude of hypothetical switching to an alternative product may not be sufficiently reliable, complete or accurate to allow the Commission to estimate elasticities of demand. However, this is a case-by-case assessment and depends on the strength of the evidence available. 55. In rapidly evolving industries, especially those characterised by fast technological progress (e.g. in the digital sector), the introduction of new or newly developed products or processes, as well as technological or regulatory changes may lead to structural market transitions, which affect existing competitive dynamics and the general reactions to relative supply conditions. In such cases, the Commission may take into account the expected changes in substitution possibilities resulting from the change in competitive dynamics, subject to the conditions set out in paragraph 21.

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Source: EUR-Lex (Cellar) · retrieved 2026-09-07