Dit is een samenvatting voor het vak European Law en gaat over Article 102 TFEU. De samenvatting is in het Engels en bevat ook de jurisprudentie behorende bij het thema.
28.1. introduction
The concept of an undertaking has the same meaning under 102 as under 101.
And abusive conduct of a dominant undertaking must have appreciable effect on
trade between MS.
Under 102 neither a dominant position nor its creation is prohibited. However,
once an undertaking is in a dominant position on the relevant market EU
competition law imposes on it a standard of conduct different from that of an
undertaking which is not in a dominant position. The ECJ emphasised that an
undertaking in a dominant position ‘has a special responsibility not to allow its
conduct to impair genuine undistorted competition on the internal market’. This
means that an undertaking in a dominant position may breach 102 by engaging
in conduct which, if carried out by its competitors rather than by it, would be
lawful.
Under 102 an undertaking in a dominant position is prohibited from abusing its
dominant position.
In order to show a breach of 102, it is necessary to establish that:
- One of more undertakings
- In a dominant position within the internal market or in a substantial part of
it
- Has abused that position
- The abuse has appreciably affected trade between MS
- There are no objective of efficiency justifications for the abuse
28.2. the concept of dominance
The ECJ defined the concept of dominance in United Brands. This definition was
further explained in Hoffmann- La Roche, in which the ECJ restated the above-
mentioned definition and added something. (para 38 and 39)
Accordingly, an undertaking is in a dominant position when it can act
independently from its competitors and consumers and thus is not subject to
normal competitive forces.
The Commission’s Guidance adopts an economic approach to the definition of
dominance. The C considers that ‘an undertaking which is capable of profitably
increasing prices above the competitive level for a significant period of time does
not face sufficiently effective competitive constraints (dwang) and can thus
generally be regarded as dominant’.
28.3. establishing dominance: market power, market definition,
assessing the existence of market power
Determination that an undertaking has market power is vital (essentieel) for the
enforcement of any competition law. This is because only undertakings which
have market power can distort the competitive process.
Usually economists refer to market power to describe the ability of a seller to
profitably impose prices above competitive prices for a sustainable period of
time.
How to assess (vaststellen) whether an undertaking has market power:
First: defining the relevant market
, Second: determining the market share which the relevant undertaking holds on
the market
Third: considering other relevant factors
28.3.1. market definition
Only in the context of the relevant market can dominance or otherwise be
ascertained. Thus, identification of the relevant market is of crucial importance. It
is also relevant for the application of 101 (for the application of the Vertical Block
Exemption (<30%)).
The relevant market has three components:
- Relevant product market (RPM)
- Relevant geographic market (RGM)
- Relevant temporal market (RTM)
See the Notice on the definition of the relevant market!
The Notice identifies three main factors of competitive constraints to which
undertakings are subject and which are used to identify the three relevant
markets:
- Demand substitution
- Supply substitution
- Potential competition
28.3.1.1. the relevant product market (RPM)
Definition in the Notice (point 7).
In order to determine whether products are or can be substituted for one another,
and thus to identify the RPM, two main factors of competitive constraints are
taken into consideration:
- Demand substitutability
- Supply substitutability
The C explained in its Notice that an undertaking cannot hold a dominant position
in the relevant market, and consequently cannot have market power, if
consumers can easily switch to available substitute products or to suppliers
offering the same product located within the same geographical market.
28.3.1.1.1. demand substitutability
To assess this the test is based on the question of whether consumers of the
relevant product would switch to substitute products if prices for the relevant
product were raised by a small but significant amount above the competitive
levels. If so, the RPM should include the substitutes. It would be unrealistic to
expect that all or even the majority of customers would switch. The decisive
factor is whether a sufficiently large number of consumers would be likely to
switch.
United Brands: bananas are, because of their own characteristics, not
substitutable by other fruits. Consumers are not likely to switch, even if an
increase in the price of bananas would be substantial.
28.3.1.1.2. the cellophane fallacy
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