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EUROPEAN COMMISSION DG Competition - page 110 / 113

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conflicts in approach to exclusionary practices, as suggested in note 4 below, were resolved during the three year consultation period?

4. Paragraphs 1 and 9 of the Guidance paper suggest that dominant firms have a “special responsibility” to ensure that their conduct does not impair effective competition on the common market, yet this responsibility was neglected in the DP a few years earlier. Might its inclusion reflect the development of case law or political compromise or both?

5. In paragraph 91, regarding “the efficiency defense” the Discussion Paper emphasizes that the “protection of rivalry and the competitive process is given priority over possible pro-competitive efficiency gains.” Does this reflect the lasting influence of the Ordo-liberal school on European competition law or can it be explained otherwise? Does this paragraph conflict with the requirement in paragraph 87 that the dominant firm need only to demonstrate that the efficiencies resulting from the conduct outweigh any negative effects on competition and consumers or paragraph 54 which emphasizes the Commission’s concern with protecting competition not competitors?

6. In paragraph 97, the Discussion Paper acknowledges that successful predatory pricing is “a risky strategy” while noting that it “is not impossible.” The U.S. Supreme Court similarly acknowledged in Matsushita Electric Industrial Co. v. Zenith Radio 475 U.S. 590 (1986) that “predatory pricing schemes are rarely tried, and even more rarely

successful.”

However, the Discussion Paper goes on for 36 additional paragraphs

discussing how properly to assess pricing that may be predatory. Why go to such great lengths to address conduct that is so rarely attempted or successful?

7. In paragraph 17, the DP asserts that the SSNIP test may be an appropriate measure of market power in a “leveraged” market whereas it may not be an appropriate measure of a dominant firm’s market power in the market in which it is dominant. What accounts for this difference?

8. In paragraph 18, the DP asserts that when examining interchangeability of products,

it is not important to consider whether merely some of the consumers product interchangeable so long as a significant portion does. Commission seem to disregard those consumers that might not alternative?

do not find the Why does the have a viable

9. In paragraph 25, the DP distinguishes between market power of a supplier from that of a buyer (“buyer power”). What is the likely effect on prices and supply in a market featuring a dominant buyer? Can such a result be characterized as competitive harm? Why or why not?

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