Chillin'Competition

My new paper, devoted to the (second) modernisation of Article 102 TFEU is available on ssrn (see here).

The point of the piece is, first, to provide the context behind the Commission’s ongoing initiative in relation to exclusionary abuses and, second, to discuss the way in which three central considerations (namely effective enforcement, meaningful judicial review and legal certainty) can be reconciled.

As the picture above and the figure below suggest, the exercise is not an easy one. It requires skilfully threading the needle to bring on board all three considerations.

The concern with effective and flexible enforcement (inescapable if Article 102 TFEU is to fulfil its role) must be addressed in a way that ensures that the law is uniformly applied across the Union and that judicial review remains meaningful (or, if one prefers, consistent with the allocation of powers in the EU legal order).

The paper suggests that the exercise, while challenging, can be assisted by a number of guiding principles and approaches.

First, the law must be administrable. If it were not, it would stand in the way of effective policy-making. It is submitted, in this regard, that administrability can be preserved by relying on ‘bright lines’ as proxies.

The AKZO case law already relies on a bright line (a 50% market share) as a proxy for dominance. It is submitted that several of the factors identified by the Court when defining the notion of abuse (coverage, nature and purpose of the practice, extent of the dominance) lend themselves naturally to this technique. For instance, effects could be deemed unlikely where coverage lies below 30%.

The use of bright lines would favour administrability (it would ease the burden of establishing an infringement), all while preserving legal certainty and allowing for effective judicial review.

It is submitted, second, that structured legal tests (a fixed, cumulative set of conditions with well-defined boundaries) are preferable to liquid or unstructured ones (that is, tests that rely on factors that may or may not be relevant in a given case and which therefore depend on a ‘holistic’ assessment).

It is explained, in this regard, that unstructured tests make it more difficult to ensure that EU law is uniformly applied across the Union. These tests are, by their very nature, a recipe for legal fragmentation (and particularly so in a decentralised legal order). They leave it, in effect, for national authorities and national courts to decide, case-by-case, the criteria against which the legality of practices is assessed.

For the same reason, liquid tests are not obvious to reconcile with full judicial review.

The paper argues, third, that substantive tests must be capable of being disproved. In other words, a set of conditions that are fulfilled always and everywhere is a bad legal test. It is submitted, in particular, that the interpretation of Article 102 TFEU cannot turn the analysis of effects into a mere formality.

The case law of the past decade suggests that this assessment is meaningful and context-specific. In the same vein, it cannot rely on a probatio diabolica or on a threshold of effects that would lead to a finding of foreclosure in virtually every instance.

Finally, there should be little doubt that the system must be allowed the necessary flexibility to evolve over time and adjust to new realities. An analysis of the case law suggests that there are ways to ensure that innovation remains compatible with the Court’s marked preference for continuity and consistency.

I will elaborate on some of these points in subsequent posts. In the meantime, I would really appreciate your thoughts on the paper (I am really grateful, by the way, to those who have alerady shared their comments). As usual, I have nothing to disclose.