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Exclusivity rebates under Article 102 TFEU and the assessment after the Intel judgment - Are there any justifications?

Svensson, Emelie LU (2015) LAGM01 20151
Department of Law
Abstract
Article 102 TFEU prohibits any abuse by one or more undertakings in a dominant position. A dominant undertaking offering exclusivity rebates falls under the prohibition laid down in Article 102 TFEU. The treatment of exclusivity rebates in case law has been a controversy, the first cases held a strict approach towards exclusivity rebates and established that exclusivity rebates are to be assessed as anticompetitive by nature, which entails that no circumstances of the case or the effect of the practice had to be taken into account. The CJEU case law evolved along with the Commission’s launch of the Priority Guidance Paper in 2009, an effects-based approach in the assessment of abusive dominant undertakings. This shift gave rise to a new... (More)
Article 102 TFEU prohibits any abuse by one or more undertakings in a dominant position. A dominant undertaking offering exclusivity rebates falls under the prohibition laid down in Article 102 TFEU. The treatment of exclusivity rebates in case law has been a controversy, the first cases held a strict approach towards exclusivity rebates and established that exclusivity rebates are to be assessed as anticompetitive by nature, which entails that no circumstances of the case or the effect of the practice had to be taken into account. The CJEU case law evolved along with the Commission’s launch of the Priority Guidance Paper in 2009, an effects-based approach in the assessment of abusive dominant undertakings. This shift gave rise to a new assessment, namely, assessing the effects of a practice rather than condemning the practice in itself with the rationale that the aim is to protect competition and consumer welfare. This new approach was expected to cover all abuses under Article 102 TFEU. However, the Intel case from 2014 demonstrates the opposite.

The two research questions deal with firstly, the current assessment for when a dominant undertaking offers exclusivity rebates under Article 102 TFEU, and secondly whether a dominant undertaking can use objective justifications to escape the prohibition in Article 102 TFEU when granting exclusivity rebates. The answer to these also presents the degree of legal certainty in this area of law.

Intel abandoned the new line of assessment and followed instead its old precedents establishing that a dominant undertaking granting exclusivity rebates abuses its dominant position ´per se´ and rejects the need to demonstrate any effects, consumer harm or cost based test. The General Court held that justifications as objective necessity or efficiencies could be taken into account. The analysis of the judgment demonstrates that it is merely practical impossible for a dominant undertaking to justify its behavior. Whether positive or negative, dominant undertakings have legal certainty in regard to exclusivity rebates, it is prohibited in a modified ´per se´ manner and there are no practical justifications. (Less)
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author
Svensson, Emelie LU
supervisor
organization
course
LAGM01 20151
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
'per se' prohibition, Effects-based approach, Intel, Article 102, Competition Law
language
English
id
5434162
date added to LUP
2015-10-29 17:31:06
date last changed
2015-10-29 17:31:06
@misc{5434162,
  abstract     = {Article 102 TFEU prohibits any abuse by one or more undertakings in a dominant position. A dominant undertaking offering exclusivity rebates falls under the prohibition laid down in Article 102 TFEU. The treatment of exclusivity rebates in case law has been a controversy, the first cases held a strict approach towards exclusivity rebates and established that exclusivity rebates are to be assessed as anticompetitive by nature, which entails that no circumstances of the case or the effect of the practice had to be taken into account. The CJEU case law evolved along with the Commission’s launch of the Priority Guidance Paper in 2009, an effects-based approach in the assessment of abusive dominant undertakings. This shift gave rise to a new assessment, namely, assessing the effects of a practice rather than condemning the practice in itself with the rationale that the aim is to protect competition and consumer welfare. This new approach was expected to cover all abuses under Article 102 TFEU. However, the Intel case from 2014 demonstrates the opposite.

The two research questions deal with firstly, the current assessment for when a dominant undertaking offers exclusivity rebates under Article 102 TFEU, and secondly whether a dominant undertaking can use objective justifications to escape the prohibition in Article 102 TFEU when granting exclusivity rebates. The answer to these also presents the degree of legal certainty in this area of law. 

Intel abandoned the new line of assessment and followed instead its old precedents establishing that a dominant undertaking granting exclusivity rebates abuses its dominant position ´per se´ and rejects the need to demonstrate any effects, consumer harm or cost based test. The General Court held that justifications as objective necessity or efficiencies could be taken into account. The analysis of the judgment demonstrates that it is merely practical impossible for a dominant undertaking to justify its behavior. Whether positive or negative, dominant undertakings have legal certainty in regard to exclusivity rebates, it is prohibited in a modified ´per se´ manner and there are no practical justifications.},
  author       = {Svensson, Emelie},
  keyword      = {'per se' prohibition,Effects-based approach,Intel,Article 102,Competition Law},
  language     = {eng},
  note         = {Student Paper},
  title        = {Exclusivity rebates under Article 102 TFEU and the assessment after the Intel judgment - Are there any justifications?},
  year         = {2015},
}