The German Federal Court of Justice clarifies that access to an essential facility does not require a dominant position in the upstream or downstream market in the electricity sector (Arealnetze)

On June 28, 2005, the German Federal Court of Justice (FCJ) clarified that the so called “essential facility clause” of Sec. 19(4) n° 4 of the German Act against Restraints of Competition (ARC) requires dominance only in the market for the essential facility itself. Contrary to the view of some commentators, it is not necessary that the owner of the essential facility is dominant on the downstream market as well. I. Facts of the case Several firms wanted to establish so-called “area networks” for electricity in development areas in Frankfurt upon Main. They had built small free-standing low-voltage power grids which connected their customers' households and/or enterprises with a voltage transformation substation. In order to supply their customers with electricity, these area networks