May 20, 2022 | News

Case C-377/20 – Servizio Elettrico Nazionale and Others v. Autorità Garante della Concorrenza e del Mercato and Others – Abuse of dominant position: the Court of Justice sets out the criteria for defining a dominant position

With the judgment handed down in Case C-377/20, the Court of Justice of the European Union (“CJEU”) has identified the elements suitable to characterize the abusive exploitation of a dominant position.

Bearing in mind that the well-being of both intermediary and final consumers must be regarded as the ultimate objective to be protected against the abuse of a dominant position, the CJEU nevertheless states that a competition authority discharges the burden of proof if it shows that a practice of an undertaking in a dominant position could affect the effective competition structure. Therefore, it is not necessary for that authority to prove that the practice may also cause direct harm to consumers.   

Moreover, the CJEU recalls that a competition authority may just demonstrate that the conduct of an undertaking in a dominant position is shown to be capable of restricting competition, without it being necessary to also prove that the desired result of such conduct has been achieved.

Therefore, the fact that the undertaking does prove that there are no actual exclusionary effects cannot be deemed sufficient to prevent the application of art. 102 TFEU.

Furthermore, according to the CJEU, it is also not necessary to prove the intention of excluding its competitors.

For their part, undertakings may defend themselves against the commercial practices of their competitors, but they must do so by using means of regular competition, i.e. competition based on merits. Therefore, if the practice put in place by the dominant position cannot also be adopted by the hypothetical as efficient competitor without using the resources and/or means inherent to the dominant position, that same practice cannot be regarded as competition on the merits.

Lastly, the Court recognizes that an undertaking in a dominant position may escape the prohibition set out in Article 102 TFEU by demonstrating that the practice under investigation was objectively justified by external circumstances or that it produced advantages to the benefit of consumers.

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