I. Introduction

Article 102 TFEU provides for the abuse of dominant position. It does not prohibit the holding of a dominant position but only the abuse. Although the term “abuse” is not defined, Art. 102 TFEU contains a non-exhaustive list of the forms of abuses.

A discriminatory abuse occurs when a dominant firm is able to discriminate against its rivals (primary line injury) and when it discriminates between its costumers (secondary line injury). Discrimination is implicated in most abuses. 

II. Types of discriminatory abuses

Abusive discrimination arises when a firm in dominant position applies “dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage”

 . It may refer to price, geographic territory or nationality.

Price discrimination occurs where different costumers are charged different prices for the same product“and also where identical prices are charged in circumstances in which a difference in the cost of supplying them would justify their differentiation”.

Geographic price discrimination entails charging different prices for the same commodities in different geographical territories.

Residence discrimination covers different charges for the same commodity depending on whether the recipient is situated within the national territory or other than it.

Predatory pricing may be defined as the practice whereby a firm sets its prices at a sufficiently low level with the purpose of eliminating a competitor or preventing the entry of a new one into the market. Predatory pricing usually involves discrimination by a dominant firm between its existing customers and actual or potential customers of rival firms. This may happen where a dominant firm cuts its prices selectively to costumers that might defect to a rival, whereas leaves higher prices to others costumers.

Margin squeeze encompasses practices whereby a vertically integrated firm with dominant position on the upstream market for an input, sets its prices at such a level that prevents the downstream rivals to compete with it. In such a situation, “the dominant firm applies a margin squeeze by setting a high price for the input, charging low prices on the downstream market, or by a combination of the two”.Margin squeeze cases involve price discrimination in the sense that a dominant firm discriminates in favour of its own downstream business, to the detriment of rivals.Loyalty (or fidelity) rebates can be described as“pricing structures offering lower prices in return for a buyer’s agreed or de facto commitment to source a large and/or increasing share of his requirements with the discounter”. They grants a financial advantage so as to prevent costumers from obtaining their supplies from competitors[14].

Refusal to supply is in principle not forbidden under the EU competition law. Only in exceptional circumstances a dominant firm would be charged with a duty to supply goods or provide services where that is necessary for another firm to carry on its business.[15] A firm endowed with dominant position may discriminate against its competitors, non-competitors and its customers. This would happen not only by refusing to supply but also by applying discriminatory conditions between its own downstream business and rivals, or deciding to supply one rival, but not another[16].

In particular, in United Brands case the Court found that the refusal of United Brands to supply bananas to Olesen, a long-standing distributor in Denmark, “would limit markets to the prejudice of consumers and would amount to discrimination which might in the end eliminate a trading party from the relevant market”[17].

Tying and bundling. There are different forms of tying and bundling.

Pure bundling is observed when two products (A and B) are sold as package.

Mixed bundling refers to situation where two products are sold separately, but they are offered at a lower price if bought together.

Tying can be described as a situation in which costumers that purchase a primary product are also required to purchase a secondary product.[18]

Pursuant to Art. 82 Guidance, “an undertaking which is dominant in one product market (or more) of a tie or bundle (referred to as the tying market) can harm consumers through tying or bundling by foreclosing the market for the other products that are part of the tie or bundle (referred to as the tied market) and, indirectly, the tying market”.[19] The conduct in question may have also elements of price discrimination because of the consumer surplus that the dominant firm extracts from other competitors.[20]

III. Conclusion

As has been seen, discrimination can arise in many cases under Article 102 TFEU, given the confusion that has been created by practice and case law.[21]

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