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"…generally speaking, any undertaking, whether dominant or not, should have the right to choose its trading partners and to dispose freely of its property."
However, throughout the years the practice of the ECJ has established that dominant undertakings that refuse to supply in certain situation may constitute an abuse under Article 102.This idea, that a dominant undertaking as a duty to supply is contrary to the deep-seated notions of freedom of contract and basic property rights, as well as intellectual property rights.This is why, this forcing of an undertaking to enter into business with another undertaking has to be done only in very specific circumstances. Even the European commission states that "it requires careful consideration" when imposing this obligation on undertakings.The rationale why the freedom of choice with which an undertaking conducts business with should not be impacted is that it may primarily impact the incentive for such undertaking to develop new products or services.Also, allowing undertakings to have access to assets developed by other undertakings may lead to a „free rider“ problem, and thus reduce economic welfare.However, the ECJ has found certain situations in which the refusal to deal would produce such negative effects and reduce consumer welfare which may overcome the positive effects of allowing an undertaking to exert its dominance over others.
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"an undertaking which has a dominant position in the market in raw materials and which, with the object of reserving such raw material for manufacturing its own derivatives, refuses to supply a customer, which is itself a manufacturer of these derivatives, and therefore risks eliminating all competition on the part of this customer, is abusing its dominant position within the meaning of Article 86."
It can be seen from this case that the ECJ used a teleological approach in defining whether there was an abuse of article 102 (article 86 in the time when the case was deliberated). Later on, in order to rain in the broad application of this principle, the ECJ throughout its case law established the standards which must be applied in order for this type of conduct to be considered as an abuse. The landmark cases which provide these standards are Magill,Oscar Bronner,and IMS, however this list is in no way exhaustive.
In Oscar Bronner, the ECJ provides the first comprehensive test to ascertain which behavior may constitute an abuse and in which circumstances. Namely, in order for an abuse to be present, the following factors must be present:
- The refusal would likely eliminate all competition in the downstream market from the person requesting access;
- There cannot be objective justification for the refusal;
- The access must be indispensable to carrying on the other persons’s business, and
- There must be no actual or potential substitute for it.
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