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EUROPEAN COMMISSION DG Competition - page 30 / 113

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company itself would be able to survive the exclusionary conduct in the event that it would be the target. The exact formulation of these principles varies from abuse to abuse, depending on, for instance, considerations about whether potentially abusive low prices or rebate schemes are offered to the whole market or only a part of it and whether low prices apply to all of a customer’s requirements or only a part of them. If examination of a dominant company’s price schedule or rebate system according to these principles leads to the conclusion that an as efficient competitor can compete with the dominant company, the Commission will normally reach the conclusion that the dominant company’s price schedule or rebate system is not abusive (safe harbour). If,

however, an as efficient competitor cannot compete with the dominant company, the

Commission will consider the conduct to have the capability to foreclose competitors and therefore examine the likely market impact of the price schedule or rebate system.

As Efficient Competitor Test 67. To apply the as efficient competitor test the authority in principle needs to have reliable information on the pricing conduct and costs of the dominant company. A number of remarks need to be made in this context. Firstly, it may be necessary to look at revenues and

costs of the dominant company in a wider context. It may not be sufficient to only assess whether the price or revenue covers the costs for the product in question, but it may be necessary to look at incremental revenues in case the dominant company’s conduct negatively affects its revenues in other markets or of other products. Similarly, in case of two sided markets it may be necessary to look at revenues and costs of both products at the same time. Secondly, in case

reliable information on the dominant company’s costs is not available it may be necessary to apply the as efficient competitor test using cost data of apparently efficient competitors. Thirdly,

where no reliable information on cost data is available but where the Commission has nonetheless been able to build on other arguments a credible case of abuse, the dominant

company may show that it is not pricing below the appropriate cost benchmark. Fourthly, it may

sometimes be necessary in the consumers’ interest to also protect competitors that are not (yet) as efficient as the dominant company. Here too the assessment does not (only) compare cost and price of the dominant company but will apply the as efficient competitor test in its specific market context, for instance taking account of economies of scale and scope, learning curve

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