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EUROPEAN COMMISSION DG Competition - page 38 / 113

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information necessary to demonstrate that there are no other economically practicable and less anticompetitive alternatives which limit its short run losses, taking into account the market conditions and business realities facing the dominant company. As to the third condition of the proportionality test, it must be shown that meeting competition is a proportionate response in view of the aim of Article 82. This requires, with a view to protect the consumers’ interest, a case by case weighing of the interest of the dominant company to minimise its losses and the interest of its competitors to enter or expand.

Meeting competition defence not available if price below ATC 83. In view of the above, in case the conduct concerns pricing below AAC the meeting competition defence can normally not be applied. Pricing below average avoidable cost is in general neither suitable nor indispensable to minimise the dominant company’s losses. In case the abuse concerns pricing above average avoidable cost the meeting competition defence can be applied only if all the conditions of the proportionality test described in the previous paragraph are fulfilled, which in general is considered unlikely to be the case.

5.5.3 EFFICIENCY DEFENCE

Conditions 84. For this defence the dominant company must demonstrate that the following conditions are fulfilled:

  • i)

    That efficiencies are realised or likely to be realised as a result of the conduct concerned;

  • ii)

    That the conduct concerned is indispensable to realise these efficiencies;

  • iii)

    That the efficiencies benefit consumers;

  • iv)

    That competition in respect of a substantial part of the products concerned is not eliminated.

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