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

CHAPTER 1
Objectives of Article 82
Turning briefly to the objectives of Article 82, in the EU the notion of harm
to consumers should hence be read in conjunction with that of harm to the
process of competition, although the two notions are quite distinct.
Moreover, consumer welfare is an aim which should be viewed dynamically,
ie by examining also its dimensions on a mid- and long-term basis. 1 Article
82 prohibits an abuse of a dominant position within the common market
or in a substantial part of it. The concern of the EC competition rules is
therefore to prevent conduct by a dominant undertaking which risks weakening
competition still further, and harming consumers. 2
In contrast to American antitrust law, there has been continuing debate
over the concept of consumer welfare referring to a narrower or broader
meaning. There are three components of consumer welfare. 3 The first
component is value for money. Consumer welfare is enhanced if the price
of goods/services is reduced or the quality of those goods is increased while
the price is not changed. Price and quality are connected where a price
means the sum payable for goods/services of a particular quality. However,
a consumer is not interested in the quality of goods/services unless the
consumer also knows their price. Quality is important because if prices in
a market reach marginal costs, this may lead to a switch from higher quality
to lower quality goods/services; indeed, this situation depends on the
consumers and their sensitivity to price. The second component is consumer
choice. Choice does not have value in itself. Nonetheless, if consumers have
1 V Mertikopoulou, ‘DG Competition’s discussion paper on the application of Article 82
of the EC Treaty to exclusionary abuses: the proposed economic reform from a legal point of
view’ [2007] 28 (4) ECLR 241–251, 242. In competition law the primary role of the consumer
welfare standard is to verify the goals of competition policy and to delineate the general legal
framework of competition law enforcement by establishing the basis for the standard of proof
required in investigation and litigation.
2 The Economic Advisory Group for Competition Policy in its report on Article 82 argued
that the use of the single term ‘consumer welfare’ conceals the fact that it refers to a multifacetted
concern. Many issues concern multiple markets, with consumer welfare effects going
in different directions in the different markets. The competition authority needs to take a
comprehensive view, taking account of the different effects of the practices under investigation
and of policy interventions on consumer welfare. See further Report by the EAGCP—‘An
economic approach to Article 82’, 9. http://ec.europa.eu/comm/competition/antitrust/art82/
index.html. (‘EAGCP Report’).
3 A Lindsay, The EC Merger Regulation: Substantive Issues (Sweet & Maxwell, London,
2003).