ARTICLE: UNILATERAL PRACTICES - ABUSE OF DOMINANCE - REBATES - THEORY OF HARM - CONSUMER WELFARE - AEC TEST

Conditional pricing and the AEC test: A happy marriage or an awkward couple?

In this article the question is investigated whether and when conditional pricing and the AEC test form a happy couple. In situations where rebates are used to dampen competition between incumbents or as an exploitative device, applying the AEC test does not make sense. However, in cases where the theory of harm is that rebates are being used as an exclusionary device, applying the AEC test is in principle useful to help distinguish between abusive and non-abusive conduct, while recognising that in some limited exclusionary conduct scenarios it does not make sense to create a safe harbour for pricing above cost. The article looks at which cost benchmark to apply and investigates possible practical difficulties of applying the AEC test, making a number of suggestions how to apply the test to different types of rebates.

I. Introduction: The Intel and Post Danmark judgments 1. The judgments of the Court of Justice [1] in Post Danmark [2] in 2012 and Intel [3] in 2017, in both cases sitting in Grand Chamber, are decisive steps in the development of a coherent effects-based approach to European Union (“EU”) competition law and to the application of Article 102 [4] in particular. To introduce this article, I will highlight what I see as the key elements of these two judgments. [5] I will then address the main issue of this article: in what circumstances the as-efficient-competitor (AEC) test is useful for the assessment of rebates. 2. The first key element of the two judgments is the Court’s confirmation that the aim of EU competition law is to enhance consumer welfare by protecting competition. Following

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Lucas Peeperkorn, Conditional pricing and the AEC test: A happy marriage or an awkward couple?, May 2019, Concurrences Review N° 2-2019, Art. N° 90191, pp. 40-53

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