strengthens its dominant position can be justified on the ground that efficiency gains would be sufficient to counteract the actual or likely anti-competitive effects and would benefit consumers.
Elimination of Competition
The fourth condition is that competition in respect of a substantial part of the
products concerned is not and will not be eliminated. When competition is eliminated the competitive process is brought to an end and short-term efficiency gains are outweighed by longer-term losses stemming inter alia from expenditures incurred by the dominant company to maintain its position (rent seeking), misallocation of resources, reduced innovation and higher prices. This is a recognition of the fact that rivalry between undertakings is an essential driver of economic efficiency, including dynamic efficiencies in the shape of innovation. Ultimately the
protection of rivalry and the competitive process is given priority over possible pro-competitive efficiency gains. This is also required for a consistent application of Articles 81 and 82. It is therefore, also when assessing the no-elimination-of competition requirement, highly unlikely that abusive conduct of a dominant company with a market position approaching that of a monopoly, or with
a similar level of market power, could be justified on the ground that efficiency gains would be
sufficient to counteract its actual or likely anti-competitive effects.
Domco’s market position approaching monopoly 92. A dominant company is in general considered to have a market position approaching that of a monopoly if its market share exceeds 75% and there is almost no competition left from other actual competitors in the market, for instance because they are producing at considerably higher costs and/or are severely capacity constrained for a longer period of time, and entry barriers are so substantial that relevant entry can not be expected in the foreseeable future.64
See C 85/76 Hoffman-La Roche cited in footnote 5, paragraphs 38-39; Case T-228/97 Irish Sugar cited in footnote 38, paragraphs 186 and 233.