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EUROPEAN COMMISSION DG Competition - page 40 / 113





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conclude that the efficiencies generated by the conduct are likely to enhance the ability and incentive of the dominant company to act pro-competitively for the benefit of consumers.63

Protect competition, consumer welfare and efficient allocation of resources

88. The Community competition rules protect competition on the market as a means of enhancing consumer welfare and of ensuring an efficient allocation of resources. This requires that the pass-on of benefits must at least compensate consumers for any actual or likely negative impact caused to them by the conduct concerned. If consumers in an affected relevant market are worse off following the exclusionary conduct, that conduct can not be justified on efficiency grounds.

Time value of consumer gain 89. In making this assessment it must be taken into account that the value of a gain for consumers in the future is not the same as a present gain for consumers. In general, the later the efficiencies are expected to materialise in the future, the less weight the Commission can assign to them. This implies that, in order to be considered as a counteracting factor, the efficiencies must be timely.

Incentives to pass on related to pressure of competition 90. The incentive on the part of the dominant company to pass cost efficiencies on to consumers is often related to the existence of competitive pressure from the remaining firms in the market and from potential entry. The greater the actual or likely negative effects on competition, the more the Commission has to be sure that the claimed efficiencies are substantial, likely to be realised, and to be passed on, to a sufficient degree, to consumers. It is therefore, when assessing the pass-on requirement, highly unlikely that the exclusionary conduct of a dominant company with a market position approaching that of a monopoly, or with a similar level of market power, can be justified on the ground that efficiency gains would be sufficient to outweigh its actual or likely anti-competitive effects and would benefit consumers. Similarly, in a market where demand is very inelastic it is highly unlikely that abusive conduct of a dominant company which


See Case T-228/97 Irish Sugar, cited in footnote 38, paragraph 189.

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