Maarten van den Ende 10970843 Supervisor: mw. dr. K.J.Cseres word count: 12969
Abuse of a Dominant Position and its Goals: Detached and in Need of
[
a Resynchronisation?
]
Table of contents
Introduction ... 4
Chapter I Abuse of a dominant position ... 7
Concept of abuse ... 7
Types of abuse: exploitative and exclusionary abuses ... 8
Chapter II Uncovering the controversy: the case law ... 10
Summary of the pre-Guidance Paper case law ... 12
The post-Guidance Paper case law: the creation of a dichotomy ... 12
Criticism on the case law ... 13
General conclusion ... 14
Chapter III Objectives of article 102 TFEU ... 16
The objectives of article 102 TFEU: from past to present ... 16
Conclusion: a shift of focus ... 18
Chapter IV The more economic approach ... 20
Context to the more economic approach: the Guidance Paper ... 20
The test: as-efficient-competitor ... 21
Criticism to the Guidance Paper ... 22
Connecting the objectives to the more economic approach ... 23
Chapter V Is there a need for a more economic approach and is the Guidance Paper the way forward? ... 24
The formal approach and the objectives of article 102 TFEU ... 24
The more economic approach, the Guidance Paper, and the objectives of article 102 TFEU 26 The more economic approach and the administrability of the legal framework ... 28
Conclusion ... 28
Conclusion ... 30
Bibliography ... 34
Treaties ... 34
Case law by the Court of Justice ... 34
Case law by the General Court ... 34
Opinions ... 35
Policy documents ... 35
Discussion papers ... 35
Introduction
The general outcry after the Intel judgement by the General Court can be noted as the latest chapter in what has been called the perpetual controversy surrounding the manner in which European competition law interacts with supposed abuses by dominant undertakings. This perpetual controversy spans across the supposedly lack of modernisation within the field, leading to the use of economic concepts that are outdated or ill applied, and the dichotomy between court practice and Commission practice. This perpetual controversy as it has been labelled by various authors1 forms the core of this thesis.
The backdrop against which this takes place took shape over 15 years ago with the modernisation of EU competition law. A key part of this modernisation involved both the Commission and the Courts opening its doors to a more evidence based method of analysis used in investigations to determine whether conduct by undertakings was detrimental to the competitive nature of the internal market. The varying degree in which, most profoundly, the Courts have accepted this wave of economic evidence in its case law has been met with criticism and subsequent scrutiny by the academic field. Whereas under the cartel prohibition the need to substantiate claims with economic evidence seems to have made its way into the reasoning of the Courts, with a prime example being Cartes Bancaires, where it arguably rolled back on the over formalistic use of the object restriction, such progressive use of economic evidence has not made its way into the field that covers the abuse of a dominant position. In this field the Courts still seem to apply an over formalistic approach, neglecting actual effects and thereby defeating the purpose of the prohibition. The Commission however seems to have fully embraced the more economic approach and seeks to bring the enforcement of article 102 TFEU in line with its practice in the field of cartels. A major step towards achieving this ambition has been the introduction of the Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings, in which it sets out its practices in enforcing article 102 TFEU.
The majority of scholars argue in favour of the more economic approach. It is relevant to determine why precisely. Proponents of the formal approach often refer to the lack of legal certainty that the economic approach encompasses and the suggestion that the more economic approach might be part of the zeitgeist, but not necessarily part of what is legally sensible.
The main question this thesis will therefor answer is whether there actually is a need for a more economic approach under article 102 TFEU, and if so, whether the approach suggested by the Commission in the Guidance Paper is the correct one. More specific, can the more economic approach attain the objectives of article 102 TFEU as they stand at this moment in time.
The question in itself is two-fold, one part seeking to establish the ability to achieve the objectives and the other part whether this is possibly whilst retaining the administrability of the
1 See for instance Pablo Colomo, ‘Intel and Article 102 TFEU Case Law: Making Sense of a Perpetual Controversy’ (2014) 29 Law Society and Economy Working Paper Series 1
legal system. The importance of this last part should not be underestimated, however it is often overlooked in discussion concerning article 102 TFEU. In short, it must be shown that not only the more economic approach is able to help in achieving the objectives of article 102 TFEU, but that it can also satisfy the extra test of doing so in an efficient and predictable manner.
In answering this question first a more in depth look will be had into what precisely constitutes to the controversy surrounding article 102 TFEU, this by establishing precisely what the criticism revolving the case law is. In doing so it will be shown that the manner in which the European courts treat rebates shows a misalignment between the manner in which rebates are treated and how current economic wisdom. The relevance of this criticism lies in the premise that the misalignment is in some shape or form preventing the current regime from achieving its objectives. This argument is illustrated with reference to the case law and the criticism that has been voiced against it.
From this the importance can be deduced to determine if a shift in objectives has taken place, justifying the criticism as illustrated in the previous section. In this it will be shown that the priorities have shifted from the creation of the internal market, illustrated by an emphasis on the competitive structure of the market, to a more consumer surplus oriented one, taking into account not just efficiencies created now but also those created in the future by innovation. However, the degree in which these changing objectives have been embraced by both the Commission and the Courts differ in the various fields of competition law. Specifically, emphasis is placed on the discrepancy between the acceptance of this by the courts when judging over abuse of dominance cases, as illustrated by reference to cases revolving around rebates, as compared to cases involving cartel agreements under article 101 TFEU.
The next step will be taken to illustrate how the both academia and the Commission see how the shift towards a more consumer surplus oriented concept should be transposed into policy. The propagated more economic approach and the as-efficient-competitor-test as its main tool will be discussed to illustrate this position. From this the link between the new objectives and the more economic approach will be elaborated upon, arguing that this consist out of the acceptance of the laissez faire style manner of conducting economic policy. The more economic approach in its core therefore lessons the depth of infringement by the Commission in the acts of undertakings and allows the market to regulate itself to produce more consumer surplus.
From this the intermediary assumption will be used that the more economic approach can from a qualitative perspective achieve a greater amount of consumer surplus. This due to the fact that establishing this on a quantitative basis is outside of the scope of this thesis. Moreover, general economic literature supports the notion that the type of rebates as discussed can have positive influences on the competitive process and subsequently on the amount of consumer surplus. The last part seeks to establish whether the test as proposed by the Commission specifically is sufficient to achieve the extra consumer surplus in a manner that is efficient and can meet the requirements of predictability and administrability required from a successful legal system. From this it will be argued that, despite recognising the need for a more economic approach when deciding upon the legality of potentially abusive behaviour, the as efficient competitor test does have its flaws.
First however, a brief introduction into the legal provisions governing the abuse of a dominant position will be given, with the emphasis on exclusionary behaviour and more specific, rebates.
Chapter I Abuse of a dominant position
This chapter gives a general introduction into the legal framework revolving around the abuse of a dominant position. The relevance of this to the overarching question is that the main arguments are supported by reference to specific characteristics of exclusionary conduct and more specifically with reference to the practice surrounding rebates and their interaction with the abuse of dominance provisions.
Article 102 TFEU sets out the legal framework for the prohibition on the abuse of a dominant position. In short the article revolves around the unilateral behaviour of one or a group of undertakings, the so called collective dominance, towards a second party. Article 102 TFEU contains five elements that must be satisfied in order for the behaviour to infringe upon it. These cumulative elements are: i) one or more undertakings that have to hold a (ii) dominant position (iii) within the internal market and (iv) abuse this position and lastly, (v) effect on inter-state trade.
The first element to touch upon is the notion of dominance. A first point of interest is that article 102 TFEU itself does not shed any light on what constitutes to a dominant position, for that we have to look into the case law. Dominance according to the case law is the “economic strength enjoyed by an undertaking which enables it to prevent effective competition being maintained on the relevant market by giving it the power to behave to an appreciable extent independently of its competitors, customers and ultimately of its consumers.”2
It is often noted and repeated that, the attainment of dominance within the internal market itself is not contrary to article 102 TFEU. In this perspective, the prohibition is in line with the for instance the cartel prohibition, in that it does not seem to have as an ultimate end the protection of competitors stricto sensu. However, it is widely accepted that, with acquiring the dominant position, acts that a non-dominant company could legally perform start to fall outside of the scope of legal activities of the dominant firm.
This notion of a distinct duty to refrain from certain behaviour legal for the non –dominant undertaking has been repeated by both the Courts and the Commission in various circumstances and examples of it are plentiful. The first time it was noted was in the Michelin I case in which the Court referred to: “irrespective of the reasons for which it has such a dominant position, the undertaking concerned has a special responsibility not to allow its conduct to impair genuine undistorted competition on the common market.”3 Moreover, in for example the Guidance on
the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings (Guidance paper) mentions this special obligation in two instances.
Concept of abuse
The second element of interest to this thesis is the notion of abuse, what constitutes to “abusive behaviour”? In contrast with the concept of dominance, article 102 TFEU does give a list of behaviour that could be noted to be abusive. However, it must be noted that this list is non-exclusive, leaving the possibility to uncover other forms of abusive behaviour. From a technical
2
Whish R, Competition Law (7th ed, Oxford University Press 2012)
point of view, this allows the prohibition to adapt to changing circumstances and maintain its relevance, whilst giving an indication of key behaviours that are abusive.
The first time the concept of abuse was used within the case law and developed by the Courts was in the Hoffman-La Roch case. In this case the CJEU stated that: “Irrespective of its age, this definition used in this case is still the prevailing notion of abuse. objective concept relating to the behaviour of an undertaking in a dominant position which is such as to influence the structure of a market where, as a result of the very presence of the undertaking in question, the degree of competition is weakened and which, through recourse to methods different from those which condition normal competition in products or services on the basis of the transactions of commercial operators, has the effect of hindering the maintenance of the degree of competition still existing in the market or the growth of that competition.”4 In using this definition the
question revolves around determining what is competition outside of the scope “normal competition” and thus can be qualified as abusive and thus weakening competition.
In more recent years both the Commission as the Courts have referred to the notion of “competition on the merits” as a reference point to put the conduct of the dominant behaviour up against. Examples of this can be found in policy documents, such as in the Guidance paper,5
OECD roundtables6 in which the Commission participated and judgements of the Court.7
Types of abuse: exploitative and exclusionary abuses
The two types of abuse under article 102 TFEU can be roughly divided into: i) exploitative and ii) exclusionary abuses.8 The following section will set out the general framework of these types of
abuses and their characteristics.
The first type of abuse is the exploitative type of abuse. According to Whish this is: “the most obvious objection to a monopolist is that it is in a position to reduce output and increase the price of its products above its competitive level, thereby exploiting its customers.”9 Article
102(2)(a) TFEU contains a list of examples that can be classified as exploitative, indicating that it falls under the prohibition.
It must be noted however that the question of whether to enforce the prohibition against exploitative behaviour is not as clear cut as it seems. There are various reasons for this, such as the fact that, in the circumstance as quoted above, the monopolist would raise its prices, this would be counteracted by the increased presence of competitors on the market, drawn in by the high profit margins and market that is not satisfied to the fullest. This under the assumption that there are no or relatively low barriers to entry.10 Moreover, it suggests that the competent
authority is to determine the competitive price for a product and can do so effectively. This in
4
C-85/76 - Hoffmann-La Roche & Co. AG v Commission of the European Communities (Hoffman La-Roche) EU:C:1979:36 par.91
5 DG Competition discussion paper on the application of Article 82 of the Treaty to exclusionary abuses, published in Brussels, December 2005 par. 1
6 OECD Roundtable: Competition on the Merits p.220 ao (2005) 7
A recent example is the Post Danmark I judgement par.25
8 DG Competition discussion paper on the application of Article 82 of the Treaty to exclusionary abuses, published in Brussels, December 2005 par.7
9
Whish R, Competition Law (7th ed, Oxford University Press 2012) p.199 10 Whish R, Competition Law (7th ed, Oxford University Press 2012) p.709
practice if often difficult and problematic up to a point that it is to be considered unachievable to determine this. Consequently, enforcement within this field is rather limited in scope and ambition.
However, guidance can be found in the case law as to determine whether a price posted by an undertaking is exploitative in its nature. The United Brands judgement is a prime example of this. In this case it noted that when the price of a product has no reasonable relation with the economic value of the product, in light of its production costs exist. In more concrete terms, it has to be shown that the price of the product in question shows no relation with the economic value of the product.11
The second type of abusive behaviour is the exclusionary conduct. In its core this conduct results in the pushing out of competitors through the use of for example exclusive dealing agreements, tying, refusals to supply, and most important for this thesis: rebates.
Irrespective of opinions during the early 1970s that the present article 102 TFEU was not intended to cover abuses other than exploitative abuses, it is now fully accepted that it does. This has been determined by the CJEU in the Continental Can judgement in which it stated that by not allowing article 102 TFEU to cover exclusionary abuses in practice, a prohibition would exist on the creation of a cartel, which limits competition, but then to allow mergers which resulted in the elimination of competition. In doing so it closed the circle with regards to the protection of competition and consumers, moreover, this interpretation is in line with the purposes of the Union as set out in articles 2 and 3 TEU.12
From a more substantive point of view, the concern lies in the ability to prevent competitors from entering the market or to maintain themselves within the market. Consequently, competition is reduced and pressure to provide prices that are close to the marginal costs will be reduced in the long run, thus reducing consumer surplus and affecting the market structure negatively.
Understanding the general characteristics of the provisions covered in article 102 TFEU is the first step in establishing how they transpose into reality, the second step covered in Chapter2 sheds light on the controversy revolving around the abuse of a dominant position within the EU legal framework.
11
C-27/76 - United Brands Company and United Brands Continentaal BV v Commission of the European
Communities (United Brands) EU:C:1978:22 par.250-254
Chapter II Uncovering the controversy: the case law
This chapter will establish what exactly gave rise to the controversies surrounding article 102 TFEU. In illustrating the main issues the case law will be investigated. From this it will be argued that a dichotomy between economic wisdom on the one hand, and the application of the law by both the Courts and the Commission, can be found most notably in the post-Guidance Paper case law.
Hoffman-La Roche (1979) revolved around the payment of fidelity rebates, in which Roche offered
exclusive purchasing agreements to customers and offering other exclusivity rebates. This tying of customers by a dominant firm was deemed to be at arms article 102 TFEU. This type of rebate is fidelity or loyalty inducing rebates. These type of rebates focus on creating loyalty between the purchasers and sellers on the basis of granting quasi exclusivity to the seller in return for rebates given to the purchaser. In its core this type of rebate is a very upfront pay-to-stay type of rebate.
With regards to the exclusivity rebates it stated that: “An undertaking which is in a dominant position on a market and ties purchasers — even if it does so at their request — by an obligation or promise on their part to obtain all or most of their requirements exclusively from the said undertaking abuses its dominant position within the meaning of Article 86 of the Treaty, whether the obligation in question is stipulated without further qualification or whether it is undertaken in consideration of the grant of a rebate.”13
According to Whish, in doing so the Court has equated the law on exclusivity rebates with the law that prohibits exclusive purchasing agreements. These transactions are prohibited because they are: “designed through the grant of a financial advantage to prevent customers from obtaining their supplies from competing producers.”14 In doing so the Court postulated a quasi per se
violation of article 102 TFEU.
Moreover, the size of the rebate in question is irrelevant for determining the outcome of whether behaviour is abusive or not. The Court states that: “that is to say discounts conditional on the customer's obtaining all or most of its requirements — whether the quantity of its purchases be large or small — from the undertaking in a dominant position.”15
This notion was kept when the General Court in Solvay come to the same conclusion. In this case the question revolved around the rebate of 1.5% on the total purchase of soda-ash. The General Court re-iterated the findings of the CJEU in Hoffman-La Roche.
This conclusion was in line with the findings of the Commission in this case, however, it was originally overturned by the General Court on the basis of procedural rules. Subsequently, the Commission re-adopted the decision taking into account the appropriate procedural rules, the
13 C-85/76 - Hoffmann-La Roche & Co. AG v Commission of the European Communities (Hoffman La-Roche) EU:C:1979:36 par.89
14 C-85/76 - Hoffmann-La Roche & Co. AG v Commission of the European Communities (Hoffman La-Roche) EU:C:1979:36 par.90
15
C-85/76 - Hoffmann-La Roche & Co. AG v Commission of the European Communities (Hoffman La-Roche) EU:C:1979:36 par.89
decision was brought before the General Court one more, and agreed with the Commission on the abusive nature of the loyalty rebates.
Subsequent pre-Guidelines case law and Commission decisions all support this stringent approach to loyalty rebates.
The Michelin I (1985) judgement covered rebates payable to purchasers of replacement tyres in the Netherlands on the condition of reaching an annual sales target. Each individual purchaser was set a custom target of sales to be reached, increasing on a yearly basis. This category of rebates is formed by the individualised target rebates. Whish describes these type of rebates as targeted towards individual customers and based on its specific procurement needs.16 In this context the
rebates need to induce both loyalty and secondly whether it could have an anti-competitive foreclosure effect.
Both the Commission and the CJEU came to the conclusion that the rebates were abusive in nature. This is the basis that: “system under which discounts are granted according to the quantities sold during a relatively long reference period has the inherent effect, at the end of that period, of increasing pressure on the buyer to reach the purchase figure needed to obtain the discount or to avoid suffering the loss for the entire period.” In this the individually targeted rebate scheme induced loyalty and was deemed to cause foreclosure. Moreover, the CJEU noted that, on the basis of lack of transparency of a rebate scheme, the conclusion that it was abusive would be reached earlier. The argument however, does not go the other way around, simply by making a rebate scheme transparent would not render it outside of the scope of article 102 TFEU.
The subsequent judgement targeting Michelin, Michelin II (2004), also covered rebates within the market for replacement tyres based on the same principle, but this time in France. The Commission and the General Court agreed on the abusive nature of the rebates. However, the Commission in its decision posted the statement that rebates linked to a period of more than three months would always be contrary to article 102 TFEU. The General Court did not agree on this point, stating that the CJEU had never concluded this.
Perhaps most importantly the General Court stated in Michelin II that there is no need to show anti-competitive effects. Behaviour can be judged to be abusive if it has the capability to restrict competition.
The third notable case covering individually targeted rebates was the Virgin/British Airways (2007) decision and subsequent judgements. British Airways offered ever increasing rebates on a retroactive basis covering all sales made. For example, if a sales representative would sell 10 tickets he would get a 5% discount, but if he sold 20 he would get a 10% discount covering all the sales, not just the last 10 tickets sold. The loyalty inducing effect of this type of rebate can be noted as being somewhat obvious. Moreover, the Courts used the line of reasoning as found in the Michelin II judgement and did not require proof of actual effects on the market, limiting itself to the question whether there is the possibility of such effects becoming reality.
Summary of the pre-Guidance Paper case law
As a first point of interest, Geradin notes the presence of the Courts distinguishing between the different types of rebates, with the quantity rebates being presumed to be non-abusive; and the exclusive and other fidelity enhancing rebates being, with the first being presumed abusive and the latter its abusive nature depending on the circumstances.17 As is demonstrated in this section,
the practice by both the Commission and the Courts can be characterised by a very formal approach to rebates, especially with regards to the exclusive rebates. This formal approach has led to much criticism over the years, as noted by many authors.18
The next section will establish the dichotomy that has come into existence after the Guidance Paper between on the one hand the Commission its practice and on the other hand the Courts practice.
The post-Guidance Paper case law: the creation of a dichotomy
With the coming into existence of the Guidance Paper the Commission sought to distance itself from the formal approach it once used when dealing with exclusionary rebates. In doing so it accepted the non-binding status of the Guidance Paper and the fact that, in principle, it could not forcefully make the Courts to accept this modern more effects based approach and make it overrule its case law, and most notable its per se prohibition as posten in Hoffman-La Roche. The relevant cases that will be examined are:Post Danmark I, Tomra, Intell and Post Danmark II.
The first important judgement is the one in Post Danmark I. This case can be noted for being the first in which the courts applied a more economic approach and applying the principles from the Guidance Paper. In doing so it argued the central point of consumers surplus within the constellation of abusive behaviour as to be a determining factor.19
In doing so, it seemed to confirm the more modern stance taken by the Commission.
The second relevant case is the Tomra judgement by the Court of Justice and was handed down shortly after the Post Danmark I judgement.
The judgement is important because contrary to the Post Danmark I judgement it does not seem to accept the notion of a more economic approach in light of assessing rebates. In the case the Court of Justice argued that the General Court had not erred in law by omitting an examination of the relationship between the prices Tomra charged and the costs it took upon itself. Moreover, the Court of Justice neither came to the conclusion that not requiring the Commission to take account of whether the prices charged to customers constituted prices below the long run average incremental costs.
In doing so the Court of Justice omitted the application of the as-efficient-competitor test, this by reference to the date of the infringement taking place before the Guidance Paper-era. This
17
Damian Geradin, Loyalty Rebates after Intel: Time for the European Court of Justice to Overrule Hoffman-La Roche, (2015) 11 forthcoming in Journal of Competition Law & Economics p.6
18 Geradin D, Loyalty Rebates after Intel: Time for the European Court of Justice to Overrule Hoffman-La Roche, (2015) 11 forthcoming in Journal of Competition Law & Economics p.6
notion could be explained both ways, as it implies that such a test is applicable to post-Guidance Paper cases.
Perhaps the most discussed post-Guidance Paper case has been the Intel judgement before the General Court. This case revolved around the granting of conditional rebates and naked restrictions to buyers of the x86 CPU.
In its original decision the Commission had seemingly gone through a great deal of effort to show the exclusionary effects on the market by Intel through the usage of the as-efficient-competitor test.
The General Court however stated that the showing of the actual capability of the exclusionary conduct to do just that by means of the as-efficient-competitor test was not required.20 The court
even went beyond that in paragraph 108 that, even if a competitor could match the rebates given by the dominant undertaking, an infringement can still be found. Moreover, it ruled in paragraph 146-150 that the key is that the key determinant is the creation of a loyalty mechanism, and not an effects analysis.
Lastly, the court noted that there is no excuse in covering only a small portion of the market, in other words there is no de minimis exception.
The last notable case is the Post Danmark II case. In this case the Court of Justice seems to take a more accepting stance towards letting go of a strict formal concept of exclusionary behaviour. In the case the court noted a two-step test for non-conditional on exclusivity rebate schemes, in which i) the nature and the operation of the rebate scheme and ii) the features of the relevant market, the regulatory context and the extent of the dominant position.21
Moreover, contrary to the findings in the Michelin I and British Airways cases, loyalty inducing rebates are no longer covered by the per se prohibition. These types or rebates are now only covered insofar it can be shown that they are likely to have exclusionary effect.
However, the court rejected the notion of the as-efficient-competitor test as the one to end all other tests.22 However, in paragraph 58 it leaves the possibility of recourse to the
as-efficient-competitor test.
Criticism on the case law
A first critique brought forward to the loyalty enhancing rebates as demonstrated in Hoffman-La
Roche is directed towards the anti-competitive effect of the rebate. As Whish states that it is
questionable whether the rebates are actually detrimental to competition, as they are brought forth by the normal competitive process. Moreover, the giving of rebates actually ensures that consumer acquire a lower price than they would have gotten without the rebates.
Geradin supports this notion by stating that whilst exclusivity rebates can be used to exclude
rivals, the rebates themselves are not anti-competitive per se.23 He comes to this conclusion on
20 T-286/09 Intel v Commission, EU:T:2014:547 par.143-144 21
C-23/14 - Post Danmark A/S v Konkurrencerådet, (Post Danmark II), ECLI:EU:C:2015:651par.29-30 22 C-23/14 - Post Danmark A/S v Konkurrencerådet, (Post Danmark II), ECLI:EU:C:2015:651II par.57
the basis of the EAGCP Report in which it is stated that the form of the rebate is not a suitable indicator to come to a conclusion with regards to the total efficiencies created by the rebate.24 In
doing this, he distinguishes the exclusivity rebates from the exclusive dealings, thereby questioning the sensibility of the per se illegality.
Geradin supports this further by noting that, in accepting form over matter the actual rebates in
their complexity can be over simplified and their actual effects on competition can be either over- or understated, leaving room for dominant undertakings to dress their rebates in the form of quantity rebates but ensuring an abusive effect.25
Lastly, Venit notes that the application of the formal approach negates the responsibility of the Courts to incorporate the qualities which are most important for the modern economy, namely: innovation and R&D.26
More importantly, the suggestion is raised that there is a need for a more flexible stance towards rebate schemes and with that the behaviour of dominant undertakings in order to ensure economic progress. The Commission translates this into its policy by emphasising the need for “innovation”. The underlying assumption for this is, as Zenger notes, is the concept that: “loyalty rebates enable firms that have created an enhanced product or a more efficient production technology to earn a higher reward for their creative efforts, which encourages firms to provide those efforts in the first place.”27 In other words, the actual effects of loyalty inducing rebates are
actual increases in competition, as opposed to the prohibiting of loyalty inducing rebates trying to mimic a competitive market structure.
However, it must be noted that the Courts have shown willingness to step away from the pure form based approach in cases such as Post Danmark I and II. A certain flexibility and acceptance of a more economic approach, and with that the nuancing of some of the criticism seems to be called for.
To summarise, the main line of criticism towards the case law revolved around the oversimplification of the rebates that, according to the Courts and Commission, would lead to exclusionary effects and thereby being detrimental to the competitive process. This on the basis that the actual effects of various types of rebates are not as clear cut as the formal approach assumes.
General conclusion
As is argued in the previous section a diverging stance towards the correct application of article 102 TFEU can be found between the courts and the Commission. Recognising this dichotomy it becomes clear that this shift can be explained by a shift in priorities of enforcement, in other words a shift of emphasis on the various objectives within competition law. In the following section this shift of focus will be discussed.
23
Geradin D, Loyalty Rebates after Intel: Time for the European Court of Justice to Overrule Hoffman-La Roche, (2015) 11 forthcoming in Journal of Competition Law & Economics p.21
24 Report by the EAGCP “An economic approach to Article 82”(2005) par.37 available at:
http://ec.europa.eu/dgs/competition/economist/eagcp_july_21_05.pdf last seen at: 4-1-2016
25 Damian Geradin, Loyalty Rebates after Intel: Time for the European Court of Justice to Overrule Hoffman-La Roche, (2015) 11 forthcoming in Journal of Competition Law & Economics p.22
26 James Venit, ‘Case T-286/09 Intel v Commission—The Judgment of the General Court: All Steps Backward and No Steps Forward’ (2014) 10 European Competition Journal p.210
27
Hans Zenger, Loyalty Rebates and the Competitive Process, (2012) 8 (4) Journal of Competition Law & Economics p.765
The level of divergence between the practice of the Courts and the Commission should be nuanced and put in perspective. First, as the Commission is the body that investigates and enforces article 102 TFEU it should come as no surprise that changes in policy towards infringements become most apparent at that level. In other words, a certain degree of lacking behind by the Courts must be expected and can only be described as reasonable in light of legal certainty. Secondly, in the post-Guidance Paper world, a case like Post Danmark II shows an acceptance by the Courts to step outside of the strict application of the formal rules. In doing so the Courts affirm a shift in priority of the objectives article 102 TFEU seeks to attain. Moreover, it shows a willingness from the Courts to allow the Commission to set out a line of policy and not take over its role as legislator within the realm of competition law.
In the next chapter, both the change in the approaches taken by the Commission and the Courts as well as the criticism against the case law will be discussed in light of the changing objectives of article 102 TFEU.
Chapter III Objectives of article 102 TFEU
The shift in manner of enforcement by the Commission and the acceptance of this shift in other fields of competition law is spurred on by a different conception of what competition law in general, and article 102 TFEU should achieve. In the following chapter it will be argued that the objectives of article 102 TFEU have shifted towards a more consumer surplus oriented one and that the criticism voiced against the more formal court practice should be interpreted in light of this.
The objectives of article 102 TFEU: from past to present
The objectives pursued by article 102 TFEU can be translated into objectives on various levels. One can distinguish between ultimate and intermediary objectives.28 In light of this the ultimate
objectives can be found in articles 2 and 3 TFEU and in Protocol 27. In this the link is established between the competition law regime and the internal market. The competition rules go as far as establishing the rules necessary for the functioning of the internal market, but no more than that.29 Moreover, there is an emphasis on economic objectives, as the common
denominator in article 3(3) TEU is productivity.30 This does not however take away from the fact
that non-economic objectives are also to be pursued. For instance the reference to the social market indicated that goals such as solidarity and respect for human dignity are placed as a demarcation line near the end of the free reign of the market economy. In attaining this overarching objective several underlying objectives can be identified. It must be noted that these objectives and most importantly the amount of emphasise placed on them varies from time period to time period. Moreover, they are often linked to one another. In other words, the division of various objectives into hard categories is not beneficial. However, keeping in mind clarity such an attempt shall be made, keeping in mind the previously mentioned.
From this in general there are three objectives that can be identified: i) consumer welfare; ii) the competitive process and iii) other objectives.
The first objective is the enhancement of consumer welfare. This despite the notion that the Courts have generally been against the inclusion of a consumer welfare consideration under article 102 TFEU.31 Indeed, older case law such as the Hoffman-La Roche judgement do emphasise
the existence of the competitive process and market structure over the pure consumerist welfare approach. Moreover it is noted that consumer welfare cannot be the goal of article 102 TFEU as, “It is significant that consumer harm is only relevant under one of the four abuses in the illustrative list. If consumer harm had been the test under Article 102, the first sentence of the provision would have prohibited ‘any abuse of a dominant position to the detriment of
28 Parret , ‘Shouldn’t We Know What We Are Protecting? Yes We Should! A Plea for a Solid and Comprehensive
Debate about the Objectives of EU Competition Law and Policy’ (2010) 6 (2) European Competition Journal 339
29 Renato Nazzini, The Foundations of European Union Competition Law: The Objective and Principles of
Article 102 (Oxford University Press 2011) p.5
30 Renato Nazzini, The Foundations of European Union Competition Law: The Objective and Principles of
Article 102 (Oxford University Press 2011) p.6
31
Victoria Daskalova, ‘Consumer Welfare in EU Competition Law: What Is It (Not) About?’ (2015) 11 The
consumers’. This is, plainly, not the case.” 32 However, she also states that objectives such as
technological advancements and economic growth are a part of the objectives. In doing so she suggests that the notion of consumer welfare is the short-term efficiency gains as opposed to long-term gains. In this the notions of consumer welfare she takes it as a static concept.33 This
does however not seem to be the manner in which the Commission uses the notion. Often referring to concepts such as price, quality, and choice, as can be seen in the Guidance Paper. In this sense the notion of consumer welfare goes beyond a static analysis and encompasses the taking into account of not just efficiencies now, but also efficiencies in the future and dynamic efficiencies.
Moreover, it must be noted that at least from the side of the Commission there is a push to bring to the foreground the notion of consumer welfare in various ways. These include speeches made by the respective commissioners as well as policy documents such as the Guidance paper. Combined with the fact that in other areas such as merger control the acceptance of the importance of R&D as bringing forth innovation. This innovation should be read as supporting the concept of the creation of long-term consumer welfare.
Lastly, the Courts have seemed to accept this innovation and quality based version of consumer welfare. For instance, it is noted that in Post Danmark the inclusion of the concepts of price, choice, quality, or innovation. Supporting the concept that consumer welfare is an objective of article 102 TFEU. From this the suggestion can be taken that the Courts are in principle open to expand their scope beyond protecting the competitive process, recognising the importance of not only market structures as such but the interplay these have with creating innovation and through that consumer welfare.34
The competitive process as an objective has been criticised extensively over the years. Where most authors describe this as protection of competitors over the protection of competition. Drawing from the supposed ordo-liberal heritage of article 102 TFEU this would indeed be a valid argument. However, article 102 TFEU does not have such heritage and henceforth does not have the structure of the market and its competitors as an objective.35 As such she identifies no
such proposition in the travaux preperatoires or any of the policy documents which elaborate on the introduction of the predecessor to article 102 TFEU.36 Moreover, she notes that, if such an
intention was there, the dominant position by itself would have been judged to in conflict with the internal market.37 However, it can be noted that market structure as a vehicle for the
competitive process is important. In both the Continental Can and Hoffman-La Roche it can be noted that behaviour that is detrimental to consumer by changing the competitive structure of the market is considered to be abusive.
32 Renato Nazzini, The Foundations of European Union Competition Law: The Objective and Principles of
Article 102 (Oxford University Press 2011) p.6
33 Victoria Daskalova, ‘Consumer Welfare in EU Competition Law: What Is It (Not) About?’ (2015) 11 The Competition Law Review 131
34
Victoria Daskalova, ‘Consumer Welfare in EU Competition Law: What Is It (Not) About?’ (2015) 11 The Competition Law Review 131
35 Akman P, ‘Searching for the Long-Lost Soul of Article 82EC’ (2009) 29 Oxford Journal of Legal Studies 267 36
Akman P, ‘Searching for the Long-Lost Soul of Article 82EC’ (2009) 29 Oxford Journal of Legal Studies 267 37 Akman P, ‘Searching for the Long-Lost Soul of Article 82EC’ (2009) 29 Oxford Journal of Legal Studies 267
This draws a link between both consumer welfare and the competitive process, where both influence each other and can draw upon each other. It is recognised by the Courts that for a long run consumer welfare state to be achieved, the existence of a competitive market is needed. This at the least hints at the importance of competitors in achieving consumer welfare. This line of thought can also be discovered in the Opinion of AG Kokott in British Airways that consumers are indirectly protected by safeguarding the process of competition.38
The third concept often referred to as underlying article 102 TFEU is fairness and economic freedom. Some authors such as Akman do away with the notion that fairness and economic freedom are integrals parts of the objectives of article 102 TFEU. It is argued that: “Competition was assumed to provide a basis for a division of income and fortune commensurate with social justice which must be complemented with an effective social and incomes policy. Hence, competition itself was not expected automatically to bring about this division or redistribution of income.”39 Hence, she links fairness to the redistribution of wealth caused by the increased
productivity and efficiency. However, Nazzini notes a far wider concept of fairness. She argues that this also encompass equality in opportunities. This often read in conjunction with article 106 TFEU, it is noted that: “Following its settled case law, in Connect Austria the Court said that Articles 106(1) and 102 prevent Member States from adopting measures that inevitably lead a public undertaking or an undertaking having special or exclusive rights to abuse its dominant position.”40 In so far it can be concluded that fairness is indeed an objective of article 102 TFEU,
irrespective of this, it should be recognised as playing a more modest role as compared to the previously mentioned objectives.
Conclusion: a shift of focus
Placing this within the perspective of further integration and the modernisation that has taken place over time, it’s not surprising to see that the emphasis on the various objectives has changed. The importance of the competitive process, for some under the banner of the ordo-liberal thought, could be noted as the most important objective. This in the context of integration and the position of the Union in the world made sense, where the prime emphasis was the completion of the internal market and avoiding dominant companies to re-implement national borders, the importance of market structure not only for the competitive process but also for its own objectives and goals could be justified. However, with the further integration and the changing of the world, which emphasis innovation more profoundly this would no longer suffice. The pronunciation of consumer welfare in the form of price, choice, quality, or innovation supports this conclusion.
The importance of this conclusion lies in the fact that it explains why such overwhelming criticism has been brought forth against the courts following various judgements, of which most notable the Intel judgement. The shift of focus on different objectives results in the partially nullification of the effectiveness of the old tools as used by the courts. Where the strict formal approach might have been very successful in protecting the competitive structure, and through
38
Opinion of AG Kokott in Case C-23/14, Post Danmark II, EU:C:2015:343
39 Akman P, ‘Searching for the Long-Lost Soul of Article 82EC’ (2009) 29 Oxford Journal of Legal Studies 267 p.294
40
Renato Nazzini, The Foundations of European Union Competition Law: The Objective and Principles of
that by proxy competition itself, it is questionable whether it truly results in more consumer surplus.
Chapter IV The more economic approach
The shift of emphasis between the objectives of competition law in general and specifically in article 102 TFEU has often been cited as to coincide with the modernisation that introduced a more economics driven competition law regime.41 This change is in its core a shift towards a
more laissez faire enforcement of the competition rules, emphasising the power of the market to correct its own errors and thereby creating consumer surplus. More specifically with regards to rebates, it encompasses the criticism of the academia that a misalignment of economic wisdom and the application of these concepts within legal provisions has arisen.
In a simplified manner, the more economic approach encompasses a more lenient stance towards enforcing the abusive of a dominant position provisions as it opens up more room for undertakings to escape the prohibition.
Before elaborating upon the practical implications of this more economic approach an outline of the Commission its understanding of the concept will be discussed including the context in which it developed.
Context to the more economic approach: the Guidance Paper
This chapter will establish the exact concept that the Commission uses when it refers to the more economic approach. In establishing this the tools by which the Commission seeks to achieve the objectives of article 102 TFEU can be uncovered and examined, which will be linked with the objectives as posted in chapter 4 and ultimately whether it can achieve these in a manner superior to the formal approach.
In the wake of criticism by many authors directed towards the formal application of the rules on cases concerning article 102 TFEU the Commission launched a review of article 102 TFEU. More precisely, the manner in which it dealt with exclusionary abuses. This review followed on a larger modernisation push within other fields of competition law such as merger control and cartel regulation, in which a more economic stance was adopted. In light of the changes in these fields authors started noticing discrepancies between the formal practice and the supposed effects of these infringements. This resulted in the call that, certain behaviour that was prohibited before might not actually have an effect on competition when examining the effect to its fullest as opposed to applying a formal stance. The acceptance of more economic evidence would bring forth a reduction in over-enforcement of article 102 TFEU, as the requirement to show actual harm would encompass just that, the showing of harm as opposed to in its core establishing the possibility of harm. In doing so, article 102 TFEU would be brought closer to the manner in which article 101 TFEU is enforced. Opponents however argued that doing so would do away with legal certainty that the case law had established, most notably Wils notes the lack of legal certainty and the increase in time it takes to complete cases as a downside of the more economic approach.
Irrespective, the Commission decided to take the step. According to some breaking with previously established case law and took a plunge down the deep end and started a process that culminated in the creation of the Guidance Paper in 2009. In this paper the Commission described its priorities and how it would handle cases that covered exclusive rebates. The
intention according to the Guidance Paper was to provide clarity as to the test used by the Commission and to help with the self-assessment
As a procedural point, it must be noted that the Guidance paper creates no legal obligations for the Courts to act accordingly. It is however binding upon the Commission, except for points in which the Commission can deviate from it or is granted discretion to do so, both based on the provisions of the Guidance Paper.
In the introduction the Commission notes that dominant undertakings should not impair effective competition which subsequently results in foreclosure of competitors and ultimately causing harm to the consumer.42 From this it states in paragraph 6 that: “the Commission is
mindful that what really matters is protecting an effective competitive process and not simply protecting competitors. This may well mean that competitors who deliver less to consumers in terms of price, choice, quality and innovation will leave the market.” In stating this the Commission seeks to address a claim that has been raised many times, namely that article 102 TFEU is an excuse to protect the competitors and not competition, and subsequently protecting its EU champions.43
The substantive part of the Guidance Paper covers two parts: i) the first part describing the policy towards dominance and exclusionary conduct in general and ii) specific types of exclusionary behaviour.
The general part of the Guidance Paper starts out with the notion of dominance
In the first part the general concepts are postulated. In short, the Commission uses the guidance paper to break with the previous case law from the Courts in applying the classic notion of dominance. What is noteworthy is the seeming willingness of the Commission to accept the fact that high market shares do not on their own always indicate dominance, this due to the fact that it does not note that there is a presumption that a high market share indicates a dominant position.
As stipulated above, the key in determining whether exclusionary conduct takes place is the question whether there is foreclosure on the market. It notes that: ‘anti-competitive foreclosure’ is used to describe a situation where effective access of actual or potential competitors to supplies or markets is hampered or eliminated as a result of the conduct of the dominant undertaking whereby the dominant undertaking is likely to be in a position to profitably increase prices (1 ) to the detriment of consumers”44
The test: as-efficient-competitor
The framework of the Guidance Paper culminates in proposing various tests to determine whether the behaviour of the dominant undertaking can be judged to be exclusionary and therefore abusive of nature. The main test identified by the Guidance Paper is the “as-efficient-competitor-test”, which will be examined below.
42
Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings OJ C 45, 24.2.2009 par.1-3
43 See google/micosoft/any US base company 44
Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings OJ C 45, 24.2.2009 par.19
In its core the as-efficient-competitor-test seeks to establish whether the behaviour by the dominant undertaking is able to exclude an as efficient competitor from the market. If it can do so it can be determined that the undertaking is pricing below its costs, and therefore abuse its dominant position.45 From this the importance of establishing a benchmark comes forth, namely:
what are the “costs” stated in the test? This benchmark is set at the average avoidable cost (AAC) and the long-run average incremental cost (LRAIC).46 The Commission notes that a failure to
cover the AAC indicates that a dominant undertaking is sacrificing profits in the short term and that an equally efficient competitor cannot serve the customers without incurring a loss.47 With
regards to the LRAIC the Commission notes that a failure to cover these costs indicates that a dominant undertaking is not recovering all of its fixed costs associated with the production of a good or service and that an as-efficient-competitor could be foreclosed from the market.48
The manner in which the Commission applies the as-efficient-competitor-test varies depending upon the type of rebate system used by the undertaking. The general question the Commission seeks to answer is directed towards the economic effects of the rebate scheme, more specific: do customers tent to buy additional products from the undertaking which they would under normal circumstances purchase from other undertakings.
In doing so, the Guidance Paper sets out several factors that are important in analysing the rebate schemes. The ability for the competitor to compete on equal terms for the entire demand of each customer, in other words: can the dominant undertaking make use of non-contestable parts of the market to exclude its competitors from the contestable parts.
With regards to specific rebates the following is posted. Incremental rebates the relevant range is formed by the incremental purchase, these are the purchases beyond the threshold set by the dominant firm as to when it grands the rebate. With regards to retroactive rebates, the range is found by assessing how much of the customers purchases can be switched to a rival, in other words, on the basis of the contestable share.
Lastly, the Commission notes the ability to show efficiencies gained outweigh the anticompetitive effects and that the behaviour is both objectively necessary and proportionate in achieving these efficiencies.
Criticism to the Guidance Paper
The Guidance Paper is aimed to provide for more certainty for undertakings and to assist in the self determination of whether rebate schemes are judged to be abusive in nature. Criticism against the Guidance Paper echoes the fact that the incorporation of more economic analysis opposed to a more formal approach decreases the clarity of the law, and henceforth legal certainty.49
Secondly, commentators such as for example Wils have questioned the foundations of the
45 Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings OJ C 45, 24.2.2009 Par.23-25
46 Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings OJ C 45, 24.2.2009 Par. 26
47
Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings OJ C 45, 24.2.2009 Par.26
48 Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings OJ C 45, 24.2.2009 Par.26
Guidance Paper, stating that in many cases the outcome would not be any different, as the concepts used in the formal approach are underlined by sound economic reasoning, henceforth the benefits created by the methods proposed in the Guidance Paper would be negligible.50
Moreover, due to the increased costs of proceedings, in both terms of monetary costs as well as time, would increase substantially, further deteriorating the cost-benefit outcome. Lastly, the fact that the Guidance Paper provides the Commission with substantial room to manoeuvre when analysing behaviour by dominant undertakings might provide for flexibility to adapt to changing forms of rebates, it also means that the legal certainty is even more at risk than in a strict application of the more economic approach.51 This, combined with the notion that this freedom
for the Commission hinders the self-assessment by undertakings puts the effectiveness and helpfulness of the Guidance Paper up for questioning, and according to some, even nullifies it.52
Connecting the objectives to the more economic approach
Having argued that a shift towards consumer surplus as main objective amongst many objectives has taken place, and what precisely is the more economic approach it is important to stipulate how these two interact with each other. As mentioned in the previous section, the more economic approach encompasses a shift away from the per se prohibitions and emphasises a need to substantiate a complaint of exclusionary conduct. In doing so it is inevitable that cases will arise in which conduct that would be caught in the penumbra of the per se prohibition will fall outside of the prohibition when applying an effects based approach. In other words, the outcome of a small percentage of cases would change from being caught by the prohibition to being deemed non-abusive.
In the following chapter it will be examined if this occurs and therefore whether there is a need for a more economic approach.
50 Wouter Wils, ‘The Judgment of the EU General Court in Intel and the so-Called “More Economic Approach” to Abuse of Dominance’ (2014) 37 (4) World Competition: Law and Economics Review 405 21
51 Wouter Wils, ‘The Judgment of the EU General Court in Intel and the so-Called “More Economic Approach” to Abuse of Dominance’ (2014) 37 (4) World Competition: Law and Economics Review 405 21-22
52
Wouter Wils, ‘The Judgment of the EU General Court in Intel and the so-Called “More Economic Approach” to Abuse of Dominance’ (2014) 37 (4) World Competition: Law and Economics Review 405 21-22
Chapter V Is there a need for a more economic approach and is the
Guidance Paper the way forward?
In this chapter the previous chapters will be combined to answer the main question: is there a need for a more economic approach. In order to do so the first step will be taken by setting of the practice by the Courts against the modern objectives of article 102 TFEU and it will be considered whether the economics involved support the conceptual possibility of attaining these by the use of the formal approach. In this a critique will be given of the overreliance on the formal approach and in principle it will be recognised that there is indeed room for a more economic approach under article 102 TFEU.
Second, the ability of the more economic approach as posted by the Commission to achieve the objectives set by article 102 TFEU will be examined. From this it will be concluded that, despite the underlying thought of the more economic approach being a reasonable one, and arguable more suitable for complex cases, the as efficient competitor test is not better than the correct application of the formal approach by the Courts, when taking into account the need for a limited incorporation of an effects analysis.
Lastly, the question whether the more economic approach as listed by the Commission can satisfy the requirement of administrability will be examined. In this, it will be argued that the as-efficient-competitor test complicates matters considerably and subsequently does not attribute to legal certainty stricto sensu. However, it is also argued that the situation is complicated further by the dichotomy between the manner in which the Courts and the Commission apply the as-efficient-competitor test.
The formal approach and the objectives of article 102 TFEU
To recall from chapter 3, the goals that the formal approach should serve are in the end consumer welfare, through protection of the competitive process, but most predominantly is the emphasis on price, choice, quality and innovation. In determining the ability to do so the criticism will be taken into account.
The first question is whether the formal approach can achieve this at all. In determining this is should be taken into account that the cases presented before the Courts are the most extreme and difficult cases, and in such often lean towards the extreme. For instance, irrespective of the method chosen, both the General Court and the Commission come to the conclusion in the Intel case that the behaviour is in violation of article 102 TFEU. In short, even a system leaning towards achieving a different balance between the various objectives, one of more market integration and market structure, can deliver the same outcome as one leaning towards a more consumer surplus oriented one.
When taking the pre-Guidance Paper line of formalism as established in chapter 2 the first difficulties arise, namely the discrepancy between conduct that is caught by the per se prohibition and current economic wisdom. Acknowledging the fact that the line of case law is predominantly geared towards achieving market integration and not necessarily the most consumer surplus alone, which can be exemplified by the lack of noting the importance of innovation in an unequivocal manner, it should come as no surprise that the ability for the strict formal approach
to achieve the laissez faire state and the subsequent consumer surplus. This notion has been recognised by many authors and is largely not the most critique point.53
From this it can be concluded that in principle the pre-Guidance Paper formal approach cannot achieve the more pronounced consumer surplus enshrined in the new focus within the objectives. This can especially be found in cases such as Hoffman- La Roche.54
More interesting is the question whether the post-Guidance Paper more moderate formal approach taken by the Courts can achieve this. The reason is that there seems to be a more nuanced approach taken by the Courts, in some instances applying a more economic approach, such as in Post Danmark I and II and in other cases completely relying on the formal approach. After this the question arises whether the market conditions as created by the formal approach can approach the objectives of article 102 TFEU. To do so a close examination of the economic effects of rebates on the competitive process, and its subsequent effects on innovation must be established.
The basis to establish this can be found by examining Schumpeter, Arrow and scholars in line with these school of thoughts. In short: these schools examine the interaction between the competitive process, market structure and innovation. Empirical evidence has shown that the specific characteristics of the industry are very important in determining which approach is best suitable to describe the pre-requisites for innovation to occur.55
As mentioned above, the anti-competitive effects of loyalty rebates are not a given fact, and in actuality take the shape of balancing between creating effective competition and excluding competitors, with the latter being a reward for being the most effective competitor. The abusive nature of this behaviour is therefore not prima facie given, as the post-Guidance Paper case law seems to accept in Post Danmark II.56
From this the next step is to question whether the formal approach completely does away with establishing some effects. In this the different categories employed by the Courts and the different stringencies of analysis come into play. Where Geradin and Venit seem to overemphasise the per se prohibition, Wils focusses on the fact that the case law requires the behaviour to have effects on undistorted competition, thereby do taking into account some effects in light of the objectives.
53 Hans Zenger, Loyalty Rebates and the Competitive Process, (2012) 8 (4) Journal of Competition Law & Economics 737
Venit JS, ‘Case T-286/09 Intel v Commission—The Judgment of the General Court: All Steps Backward and No Steps Forward’ (2014) 10 European Competition Journal 206 p.
Geradin D, Loyalty Rebates after Intel: Time for the European Court of Justice to Overrule Hoffman-La Roche, (2015) 11 forthcoming in Journal of Competition Law & Economics p.21-22
54 Geradin D, Loyalty Rebates after Intel: Time for the European Court of Justice to Overrule Hoffman-La Roche, (2015) 11 forthcoming in Journal of Competition Law & Economics p.4-5
55
Sidney G Winter, The Logic of Appropriability: From Schumpeter to Arrow to Teece”, (2006) Research Policy p.1104
56 John Vickers, ‘Some Economics of Abuse of Dominance’ in Paulo Buccirossi (ed), Handbook of Antitrust
