Summary Abuse of Market Power

Abuse of Market Power
ARTICLE 102 TFEU (EU)/CHAPTER II CA 1998 (UK)

1) Abuse
2) One or more undertakings
3) Dominant position
4) Within (substantial part) of internal market (Art 102)/NOT substantial part
of UK (Chpt II)
5) May affect trade between MS

1) ABUSE

a) Exploitative abuses

 Exploitative abuses - Dominant undertaking takes advantage of its market
power to exploit its customers.

1. Charging excessive prices

 [United Brands] – Excessive prices > Price that is unfair by comparison with
product’s economic value.

2. Excessively low price by dominant buyer

 Dominant undertaking may be buyer, NOT supplier => Demand unreasonably
low prices from its suppliers => Abuse.

b) Exclusionary abuses

 Exclusionary abuse - Dominant undertaking prevents/hinders competition on
market.

1. Predatory pricing

 Predatory pricing – Dominant company reduces prices => Forces smaller
competitors to exit => Subsequently raises prices above competitive level.
 [AKZO Chemie v Commission]
o AKZO sold products in both markets A + B.
o ECS sold products only in market B => ECS planned to expand in market B.
o AKZO cut prices in market B + targeted ECS’s customers => Remove ECS
from market B.

2. Exclusive dealing

 Exclusive dealing – Other suppliers cannot sell their products to customers
subject to exclusive dealing/rebates.