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Post Denmark - an in depth case analysis

Påhlsson, Adam LU (2014) JURM02 20141
Department of Law
Abstract
Højesteret asked the Court of Justice of the European Unions for a preliminary ruling of the situation of Post Danmark abusive dominant position under article 102 TFEU. Post Danmark had applied price strategies acquired from synergies maintained from its range of products. Post Danmark was able to force prices down on the relevant market for unaddressed mail in the market of Denmark. The pricing held below cost for the Coop group and above cost for Spar and SuperBest assessed in this essay. The CJEU discussed abuse of dominant position, the competition on the merits test, pricing above and below cost, the ‘as-efficient competitor’ test, price discrimination, objective justification and special responsibility in the judgment and every... (More)
Højesteret asked the Court of Justice of the European Unions for a preliminary ruling of the situation of Post Danmark abusive dominant position under article 102 TFEU. Post Danmark had applied price strategies acquired from synergies maintained from its range of products. Post Danmark was able to force prices down on the relevant market for unaddressed mail in the market of Denmark. The pricing held below cost for the Coop group and above cost for Spar and SuperBest assessed in this essay. The CJEU discussed abuse of dominant position, the competition on the merits test, pricing above and below cost, the ‘as-efficient competitor’ test, price discrimination, objective justification and special responsibility in the judgment and every aspect has been discussed and analysed in this essay. The purpose of this essay was to see how the Post Danmark judgment was dealt with by the European court and how the judgment would lead to a new approach concerning how to solve cases of abusive behaviour in the area of Union Competition law.

The test Competition on the merits is a threshold that all the companies that are allegedly abusing their position have to walk through. This test took form in Hoffman La Roche but was changed in the judgment of Post Danmark to include the working of detriment of consumers instead of competition. The AKZO-test was moderated to the Average incremental cost test in the judgment and was assessed in this essay with the conclusion that we have not seen every abusive situation been evaluated yet and that case law is constantly changing. This test was applicable because Post Danmark used its costs on different markets to find synergies in infrastructure and in the common costs. It was therefore essential in looking at these costs and seeing to the effect of what lower prices might lead to.

The selective low pricing concept and case law was discussed in the Opinion of Advocate General Mengozzi but was not stated in the courts judgment and did therefore not provide us with any new information. Price discrimination was seen in the judgment not to be by itself an abuse but together with negative effects or unlawful conduct made by the dominant undertaking. All the abovementioned theories and legal aspect have the potential to be abuse but may be justified when finding efficiencies of benefits for consumers.

The conclusion that was drawn from the discussions and the attempted analysis is that holding prices in between average total cost and average incremental cost might be seen as abusive if there are large common costs attained from a multi-product range or from economies of scope. The ‘as-efficient compeitotr test will take this information into account when assessing the conduct. (Less)
Abstract (Swedish)
Højesteret frågade domstolen i Europeiska Unions om förhandsavgörande i
fallet om Post Danmarks hade missbrukat sin dominerande ställning med
tolkning under artikel 102 i funktionsfördraget. Post Danmark hade
tillämpat prisstrategier som förvärvats synergier som upprätthålls av sitt
utbud av flera produkter. Post Danmark har kunnat tvinga ned priserna på
den relevanta marknaden för oadresserade brev på den geografiska
marknaden i Danmark. Prisnivån var satt under kostnaderna för Coop
koncernen och över kostnaderna för Spar och SuperBest bedömdes i denna
uppsats. I förhandsavgörandet diskuterade EU-domstolen missbruk av
dominerade ställning, Pris och prestationskonkurrens testet , prissättning
ovan och under kostnader, lika... (More)
Højesteret frågade domstolen i Europeiska Unions om förhandsavgörande i
fallet om Post Danmarks hade missbrukat sin dominerande ställning med
tolkning under artikel 102 i funktionsfördraget. Post Danmark hade
tillämpat prisstrategier som förvärvats synergier som upprätthålls av sitt
utbud av flera produkter. Post Danmark har kunnat tvinga ned priserna på
den relevanta marknaden för oadresserade brev på den geografiska
marknaden i Danmark. Prisnivån var satt under kostnaderna för Coop
koncernen och över kostnaderna för Spar och SuperBest bedömdes i denna
uppsats. I förhandsavgörandet diskuterade EU-domstolen missbruk av
dominerade ställning, Pris och prestationskonkurrens testet , prissättning
ovan och under kostnader, lika effektiv konkurrensprincipen,
prisdiskriminering, objektivt godtagbara skäl, särskilt ansvar och varje
aspekt har diskuterats och analyserats. Syftet med uppsatsen var att se hur
domen i Post Danmark behandlades av de europiska domstolen och om
denna skulle föranleda en ny strategi för hur man bör lösa missbruk av
dominerande ställning inom EUs konkurrensrätt.
Testet angående Pris och prestationskonkurrens är en tröskel för alla företag
som påstås missbruka sin ställning bör kliva över. Detta testet var skapat i
Hoffman La Roche, men ändrades i domen av Post Danmark att omfatta
bearbetning av skada för konsumenterna istället för konkurrensen. De
omgjorda AKZO-testen till det inkrementala kostnader-testet i
förhandsavgörandet utvärderades i denna uppsats med slutsatsen att vi inte
har sett alla framtida situationer än och att rättspraxis är i ständig förändring.
Detta test var tillämpligt på den grunden att Post Danmark använda alla sina
kostnader på marknaden för att hitta synergier i infrastrukturen och i
samkostnaderna. Det var därför väsentligt att titta på dessa kostnaderna och
se vart dessa lägre kostnaderna kommer att leda till.
Det selektivt låga priskonceptet och den tillhörande rättspraxis diskuterades
i Generaladvokatens Mengozzi förslag till förhandsavgörande men förekom
inte i domstolens domslut och därför föranleder inte någon ny information.
Prisdiskriminering sågs i domen att inte vara ett missbruk i sig, utan
tillsammans med andra negativa effekter eller olagligt beteende från
företaget i dominerande ställning. Alla ovannämnda teorier och juridiska
aspekten har potentialen att vara grund för missbruk av dominerade
ställning men kan rättfärdigas om fördelar i effektivitetshänseende som
gynnar konsumenter.
Slutsats man kan dra av diskussionen och försöken till analys är att priserna
på satta mellan den totala kostnaden och de inkrementala kostnaderna kan
ses som missbruk om det finns stora samkostnader som kan uppnås av ett
flerproduktutbud stordriftsfördelar. Pris och prestationskonkurrens testet tar
dessa uppgifter i beaktande vid bedömning av uppträdandet. (Less)
Please use this url to cite or link to this publication:
author
Påhlsson, Adam LU
supervisor
organization
course
JURM02 20141
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
102, as efficient competitor, post danmark
language
English
id
4459781
date added to LUP
2014-06-12 09:06:28
date last changed
2014-06-12 09:06:28
@misc{4459781,
  abstract     = {{Højesteret asked the Court of Justice of the European Unions for a preliminary ruling of the situation of Post Danmark abusive dominant position under article 102 TFEU. Post Danmark had applied price strategies acquired from synergies maintained from its range of products. Post Danmark was able to force prices down on the relevant market for unaddressed mail in the market of Denmark. The pricing held below cost for the Coop group and above cost for Spar and SuperBest assessed in this essay. The CJEU discussed abuse of dominant position, the competition on the merits test, pricing above and below cost, the ‘as-efficient competitor’ test, price discrimination, objective justification and special responsibility in the judgment and every aspect has been discussed and analysed in this essay. The purpose of this essay was to see how the Post Danmark judgment was dealt with by the European court and how the judgment would lead to a new approach concerning how to solve cases of abusive behaviour in the area of Union Competition law. 

The test Competition on the merits is a threshold that all the companies that are allegedly abusing their position have to walk through. This test took form in Hoffman La Roche but was changed in the judgment of Post Danmark to include the working of detriment of consumers instead of competition. The AKZO-test was moderated to the Average incremental cost test in the judgment and was assessed in this essay with the conclusion that we have not seen every abusive situation been evaluated yet and that case law is constantly changing. This test was applicable because Post Danmark used its costs on different markets to find synergies in infrastructure and in the common costs. It was therefore essential in looking at these costs and seeing to the effect of what lower prices might lead to. 

The selective low pricing concept and case law was discussed in the Opinion of Advocate General Mengozzi but was not stated in the courts judgment and did therefore not provide us with any new information. Price discrimination was seen in the judgment not to be by itself an abuse but together with negative effects or unlawful conduct made by the dominant undertaking. All the abovementioned theories and legal aspect have the potential to be abuse but may be justified when finding efficiencies of benefits for consumers. 

The conclusion that was drawn from the discussions and the attempted analysis is that holding prices in between average total cost and average incremental cost might be seen as abusive if there are large common costs attained from a multi-product range or from economies of scope. The ‘as-efficient compeitotr test will take this information into account when assessing the conduct.}},
  author       = {{Påhlsson, Adam}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Post Denmark - an in depth case analysis}},
  year         = {{2014}},
}