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

The Gap in the Application of Article 82 45
pendently. However, what is unclear is how these two elements relate to
each other. From an economic perspective, independent actions do not
distinguish between dominant firms and non-dominant firms. No firm can
act to an appreciable extent independently of its consumers or customers.
This is because each firm is constrained by the demand curve it faces. Firms
typically face downward sloping demand curves, indicating that a firm can
only charge a higher price if it is willing to make fewer sales. It is not open
to the firm to raise prices and sell the same quantity as before. This argument
holds both for a dominant and a non-dominant firm.
Four requirements must be met for the application of Article 82. One or
more undertakings must be in a dominant position, and such position must
be held within the common market or a substantial part of it. In addition,
there must be an abuse and this must have an effect on inter-State trade. 4
Dominance is analysed in relation to three variables: the product market,
the geographical market and the temporal market. 5 Article 82 does not
prohibit the existence of a dominant position, rather it only prohibits its
abuse. 6
The main types of abuse include: excessive pricing 7 (United Brands),
predatory pricing 8 (AKZO 9 ); discriminatory pricing 10 (United Brands);
4 A Jones and B Sufrin, EC Competition Law—Text, Cases and Materials (2 nd edn, OUP,
2004) 255.
5 P Craig and G De Burc, EU Law—Text, Cases and Materials (3 rd edition, OUP, 2003)
993.
6 V Korah, An Introductory Guide to EC Competition Law and Practice (5 th edn, Oxford,
1994) 83.
7 On excessive pricing see indicatively: D Elliott, ‘What is an Excessive Price?’ [2007] 6(8)
Comp L I 6(8) 13–15, S Kon, S Turnbull, ‘Pricing and the Dominant Firm: Implications of the
Competition Commission Appeal Tribunal’s Judgment in the Napp case’ [2003] 24(2) ECLR
70–86, M Glader, S Larsen(2006) ‘Article 82: Excessive Pricing’ [2006] 5 (7) Comp L I 3–5,
D Geradin, M Rato, ‘Excessive Pricing: in Reply’ [2006] 5(10) Comp L I 3–5, P Oliver, (2006)
‘The Concept of “Abuse” of a Dominant Position under Article 82 EC: Recent Developments
in Relation to Pricing’ [2006] 1 (2) Euro CJ 315–339.
8 On predatory pricing see indicatively: M Gal, ‘Below-Cost Price Alignment: Meeting or
Beating Competition? The France Telecom case’ [2007] 28 (6) ECLR 382–391, M
Gravengaard, ‘The Meeting Competition Defence Principle—a Defence for Price
Discrimination and Predatory Pricing?’ [2006] 27 (12) CLR 658–677, P Andrews, ‘Is Meeting
Competition a Defence to Predatory Pricing?—The Irish Sugar Decision Suggests a New
Approach’ [1998] ECLR 49, T Eilmansberger (2005) ‘How to Distinguish Good From Bad
Competition Under Article 82 EC: In Search of Clearer and More Coherent Standards for
Anti-competitive Abuses’ CMLR (PP) 129, OECD, ‘Competition Policy Roundtable on
Predatory Foreclosure’ (15 March 2005) 1–279.
9 Case C-62/86, AKZO Chemie BV v Commission [1991] ECR I-3359.
10 On price discrimination/rebates see indicatively: OECD, ‘Competition Policy Roundtable
on Loyalty and Fidelity Discounts and Rebates’ (4 March 2003) 1–239, J T Lang,
‘Fundamental Issues Concerning Abuse Under Article 82 EC’ [2005] Regulatory Policy
Institute 19, J T Lang, ‘Defining Legitimate Competition: How to Clarify Pricing Abuses
Under Article 82’ [2002] FILJ 83, M Lorenz, M Lübbig and A Russel (2005), ‘Price
Discrimination, a Tender Story’ [2005] ECLR 355, P Akman, ‘To Abuse, or Not to Abuse:
Discrimination between Consumers’ [2007] 32 (4) E L Rev 492–512, D Gerard, (2005) ‘Price