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- Report n°2: An integrated approach to economic and social contestability in business
Report n°2: An integrated approach to economic and social contestability in business
A restriction of access to networks
As part of his strategy to limit external economic contestability, the recycling operator may also seek to restrict his competitors' access to the public freight-transport networks, whether for supplying materials to recycle or for delivering the secondary raw materials to the downstream marketof the branch. The historic operator will acquire a strongly competitive position if he can make investments giving him exclusive access to transport networks that nominally are freely available; or if he can reserve for himself access to networks that offer the lowest transport costs. If he acquires one of these two advantages at reduced cost, this will then be a barrier to the entry of new operators seeking to compete with his trading position. It will also decrease the historic operator's interest in an alternative location, and hence heighten his interest in threats that could jeopardise this privileged location.