The prohibition on abuse of dominance
The prohibition on abuse of dominance

The following Competition guidance note provides comprehensive and up to date legal information covering:

  • The prohibition on abuse of dominance
  • Dominance
  • Abuse of dominance
  • Objective justification
  • Article 106(1) TFEU in conjunction with Article 102 TFEU

In the EU, unilateral or ‘dominant’ firm conduct is governed by Article 102 TFEU. In particular, Article 102 TFEU prohibits undertakings that (individually or collectively) hold a dominant position within the internal market or a substantial part of it from abusing their dominance (without objective justification) insofar as it may affect trade between Member States.

This provision is mirrored in the national competition laws of EU Member States (for example, the UK's Chapter II prohibition on abuse of a dominant position—set out in section 18 of the Competition Act 1998) and which can apply even where an effect on trade between Member States is not established (see Effect on trade).

Article 102 TFEU places a ‘special responsibility’ on dominant undertakings—aiming to ensure that powerful firms do not distort markets, act unfairly towards customers or reduce the threat of competition by excluding rivals, in particular by:

  1. directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions

  2. limiting production, markets or technical development to the prejudice of consumers

  3. applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage, or

  4. making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which by their nature or according to commercial usage have no connection with the subject of such contracts.

The EU