Abuse of Economic Dependence - The Centre for European Policy ...

CHAPTER 2
Concept of Dominance
The European Union has its origins in the common market established by
the European Coal and Steel Treaty in 1952. 1 The aim of the ECSC Treaty,
as stated in Article 2, was to contribute, through the common market for
coal and steel, to economic expansion, growth of employment and a rising
standard of living. In the light of the establishment of the common market,
the ECSC Treaty introduced the free movement of products without
customs duties or taxes. It prohibited discriminatory measures or practices,
subsidies, aids granted by States or special charges imposed by States and
restrictive practices. The Treaty dealt specifically with three elements which
could distort competition: agreements, 2 concentrations and the abuse of
dominant position.
Article 66(7) of the ECSC Treaty was based on dominance. 3 The origins
of the notion of dominance can be traced back to German competition law.
The German competition law (Gesetz gegen Wettbewerbsbeschränkungen
(‘GWB’) 4 ) used the term ‘dominance’ in section 22(1); it was a familiar
concept due to the previous Abuse Regulation of 1923. 5 One reason for
adopting the term dominance rather than the term monopolization which
1 The ECSC Treaty expired on 23 July 2002. Thus, the coal and steel sectors are now
subject to Articles 81 and 82, rather than Articles 65 and 66 ECSC. The consequences of this
expiry are explained in the Commission’s document Communication from the Commission
concerning certain aspects of the treatment of competition cases resulting from the expiry of
the ECSC Treaty OJ [2002] C152/5, [2002] 5 CMLR 1036, Section 2: http://europa.eu.int/eurlex/pri/en/oj/dat/2002/c_152/c_15220020626en
00050012.pdf.
2 Agreements or associations between undertakings could be cancelled by the High
Authority if they directly or indirectly prevented, restricted or distorted normal competition.
3 Article 66(7) was concerned with the concept of a dominant position: If the High
Authority finds that public or private undertakings which, in law or in fact, hold or acquire in
the market for one of the products within its jurisdiction a dominant position shielding them
against effective competition in a substantial part of the common market are using that position
for purposes contrary to the objectives of this Treaty, it shall make to them such recommendations
as may be appropriate to prevent the position from being so used. If these
recommendations are not implemented satisfactorily within a reasonable time, the High
Authority shall, by decisions taken in consultation with the Government concerned, determine
the prices and conditions of sale to be applied by the undertaking in question or draw up
production or delivery programmes with which it must comply, subject to liability to the penalties
provided for in Articles 58, 59 and 64.
4 Available from the Bundeskartellamt website http://www.bundeskartellamt.de/wDeutsch/
index.shtml ?navid=27.
5 Verordnung Gegen Missbrauch Wirtschaftlicher Machtstellungen, 1923,
Reichsbesetzblatt, [R6B.1] I, 1067, 2 November 1923.