Post Denmark - an in depth case analysis
Abstract: Højesteret asked the Court of Justice of the European Unions for a preliminary ruling of the situation of Post Danmark abusive dominant position under article 102 TFEU. Post Danmark had applied price strategies acquired from synergies maintained from its range of products. Post Danmark was able to force prices down on the relevant market for unaddressed mail in the market of Denmark. The pricing held below cost for the Coop group and above cost for Spar and SuperBest assessed in this essay. The CJEU discussed abuse of dominant position, the competition on the merits test, pricing above and below cost, the ‘as-efficient competitor’ test, price discrimination, objective justification and special responsibility in the judgment and every aspect has been discussed and analysed in this essay. The purpose of this essay was to see how the Post Danmark judgment was dealt with by the European court and how the judgment would lead to a new approach concerning how to solve cases of abusive behaviour in the area of Union Competition law. The test Competition on the merits is a threshold that all the companies that are allegedly abusing their position have to walk through. This test took form in Hoffman La Roche but was changed in the judgment of Post Danmark to include the working of detriment of consumers instead of competition. The AKZO-test was moderated to the Average incremental cost test in the judgment and was assessed in this essay with the conclusion that we have not seen every abusive situation been evaluated yet and that case law is constantly changing. This test was applicable because Post Danmark used its costs on different markets to find synergies in infrastructure and in the common costs. It was therefore essential in looking at these costs and seeing to the effect of what lower prices might lead to. The selective low pricing concept and case law was discussed in the Opinion of Advocate General Mengozzi but was not stated in the courts judgment and did therefore not provide us with any new information. Price discrimination was seen in the judgment not to be by itself an abuse but together with negative effects or unlawful conduct made by the dominant undertaking. All the abovementioned theories and legal aspect have the potential to be abuse but may be justified when finding efficiencies of benefits for consumers. The conclusion that was drawn from the discussions and the attempted analysis is that holding prices in between average total cost and average incremental cost might be seen as abusive if there are large common costs attained from a multi-product range or from economies of scope. The ‘as-efficient compeitotr test will take this information into account when assessing the conduct.
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