abuse of dominance Flashcards
(20 cards)
abuse of dominance
The main concern is that an
undertaking will exploit its power over the market and act anticompetitively, e.g., raise prices, reduce innovation etc.
framework
Article 102 TFEU
New Notice on the definition of the relevant market (2024 version)
+ existing and planned guidances
dominant position - elements
United Brands case
1) relevant market
2) DOMINANCE = power over that market
United Brands case (banana case)
how to define a relevant market?
different relevant markets:
product market
geographic market
temporal market
1) product market
which products are in competition with the problematic product?
– legal test: SUBSTITUTABILITY TEST (are fruits one market or do we need a separate market for apples?)
1) demand
2) supply
Continental can case
demand-side substitutability test
looking from the view of the customer
1) products characteristics and use
2) price-based test - SNIPP test
SNIPP test (scissors)
small but significant, non-transitory increase in price
would customers still use the product if the potential monopolist would raise the price (5-10%) or would they switch to a different product?
supply-side substitutability
looking from the producer’s perspective - how fast
geographic market
where are the conditions the same or very similar?
e.g. if your local supermarket increases its prices, do you drive to a different city to buy for lower prices?
temporal market
seasonal products, holidays, olympic games where everything is more expensive
digital economy problem
zero-priced markets (you don’t pay money to google, but with data)
dominance - how to establish?
constraints posed:
1) by actual competitors
2) potential competitors
3) countervailing buyer power
constrains by actual competitors
market shares used as first indication (but not the only one)
other factors: market conditions, dynamics, differentiation of products…)
Hoffman Laroche case
CJEU established a presumption: market shares above 50% there’s a presumption of dominance unless there are exceptional circumstances
(other factors still have to be taken into account)
constrains by potential competitors
how likely is it to enter the market or expand a market position?
- likelyhood
- in a swift timeframe
oligopoly (collective dominance
further test - Airtours case
1) members of oligopoly have ability to know
2) there must be an incenvitve
3) forseeable reaction of other members
cartel and abuse of dominance at the same time
