Jurisdictional Clauses and Abuses of a Dominant Position – Case C‑595/17 Apple ECLI:EU:C:2018:854

This review concerns the judgment of 24 October by the CJEU on whether generally worded jurisdiction clauses cover claims of abuse of a dominant position brought by one party to a contract against the other (Case C‑595/17 Apple ECLI:EU:C:2018:854). The interpretation of generally worded jurisdiction clauses, and whether they extend to cartel claims, was the topic of a couple of articles that I reviewed a few weeks ago here and here. Facts The case concerns a distribution contract entered into between Apple and eBizcuss (the ‘authorised reseller’ or ‘distributor’) which contained a jurisdiction clause conferring jurisdiction on the Irish courts. The clause read as follows: ‘This Agreement and the corresponding relationship between the parties shall be governed by and construed in accordance with the laws of the Republic of Ireland and the parties shall submit to the jurisdiction of the courts of the Republic of Ireland.’ In 2012, the authorised reseller brought proceedings before the tribunal de commerce de Paris…

Kai-Uwe Kuhn and Miroslava Marinova ‘The Role of the As-Efficient-Competitor After the CJEU judgment in Intel’ (2018) Competition Law and Policy Debate 4(2) 63

Before I begin my review, a disclaimer is in order: one of the authors was my student – the one who was not until recently the Chief Economist of the European Commission’s DGComp –, and this paper builds on her PhD. The paper – which can be found here – focuses on the relevance of the AEC test for the identification of abuses of a dominant position. It reads the Intel decision as creating a rebuttable presumption of illegality of exclusivity rebates, and as requiring the Commission to examine Intel’s arguments on whether the loyalty rebates could exclude an equally efficient competitor from the market. It also considers that the CJEU confirmed that the AEC test is the relevant benchmark to assess such a rebuttal. At the same type, the authors consider that the judgment raises a number of issues: (i) whether the AEC is an appropriate conceptual benchmark to identify anticompetitive conduct; (ii) in the light of the previous…

Pablo Ibáñez Colomo ‘The Future of Article 102 TFEU after Intel’ (2018) Journal of European Competition Law & Practice 9(5) 293

The author identifies two main takeaways from the Intel decision: (i) as a matter of principle, Article 102 TFEU is only concerned with the exclusion of rivals that are as efficient as the dominant firm. The departure from the market of rivals that are less attractive in terms of, inter alia, price, quality or innovation is deemed to be a natural outcome of the competitive process and as such unproblematic; (ii) practices are only caught by Article 102 TFEU insofar as they are capable of having anticompetitive effects. By the same token, it should always be possible for a dominant firm to provide evidence showing that, in the context in which it is implemented, the practice is incapable of having such effects. The article – which can be found here – seeks to explore these elements in more detail. It is structured as follows: Section II reviews the case and its background. I am not going to do that here (again), but it…

Pascale Déchamps and Gunnar Niels  ‘The One Billion Euro Question for Intel: Moore’s Law or Murphy’s Law?’ (2018) Journal of European Competition Law & Practice 9(2) 124

This paper – which can be found here – is structured as follows: It begins by recalling the context of the Intel case.  In the past, EU case law tended to follow a form-based approach: first determine dominance; then assess the form of the conduct. Once a company was found to be dominant, its ‘special responsibility’ not to impair competition meant that it could not engage in certain forms of behaviour, such as offering loyalty rebates. Little consideration was given to the likely effects of these practices on competition and consumer welfare in a given case. The Intel case, however, came after the Commission started promoting effects-based analysis in abuse of dominance cases. The idea was that practices that have the same effect on the market should be treated in the same way, regardless of their form. This took the form of a Guidance Paper, which was followed by a series of Commission cases and EU court judgments that ranged…

Mark Friend ‘Loyalty Rebates and Abuse of Dominance’ (2018) The Cambridge Law Journal 77(1) 25

This paper – which can be found here – argues that the Intel decision should be given a cautious welcome for signalling a move to a more economics-based approach in the assessment of loyalty rebates. On the other hand, the author thinks that the decision also represents a missed opportunity to provide a comprehensive analytical framework for one of the more unsatisfactory areas of EU competition law. The author begins by describing the EU case law on rebates. In line with AG Wahl’s Opinion, the author identifies two main strands in the case law: Since Michelin II, it has been clear that quantity rebates or discounts – linked solely to volumes purchased from the dominant undertaking – are generally considered not to give rise to foreclosure effects and are presumptively lawful. On the other hand, loyalty rebates have consistently been condemned ever since Hoffmann-La Roche. This case held that a dominant company will be guilty of an abuse whenever that…

When is a rebate prima facie anticompetitive? Case C‑413/14 P Intel v Commission ECLI:EU:C:2017:632

This piece reviews the Court of Justice’s decision by the Grand Chamber in Intel (Case C‑413/14 P Intel v Commission ECLI:EU:C:2017:632), which can be found at http://curia.europa.eu/juris/liste.jsf?num=C-413/14. The facts of the case are relatively straightforward. Intel sells x86 CPUs processors. The x86 architecture is a standard designed by Intel for its CPUs, and can run both Windows and Linux operating systems. The European Commission found that Intel had engaged in two abusive conducts concerning these processers intended to exclude a competitor, AMD, from the market for x86 CPUs; and imposed a EUR 1.06 billion fine. The first conduct consisted in the grant of rebates to four original equipment manufacturers (‘OEMs’), namely Dell, Lenovo, HP and NEC. These rebates were conditional on these OEMs purchasing all or almost all of their x86 CPUs from Intel. The second conduct consisted in making payments to OEMs so that they would delay, cancel or restrict the marketing of certain products equipped with AMD CPUs….

Luis Ortiz Blanco and Jose Luis Azofra Parrondo ‘The Intel Case: Issues of Economic Analysis, Comity and Procedural Fairness’

According to the authors of this short pirce – which can be found here – the Intel judgment addresses three main issues: (i) the role that economic analysis – and the as-efficient-competitor test – should play in the context of abuses of dominant position in general, and loyalty rebates in particular; (ii) the jurisdiction of the European Commission and international comity; and (iii) procedural fairness and the rights of the defence. Looking at each in turn: The As-Efficient-Competitor (AEC) Test – This part of the paper describes the facts of the case and outlines the Court’s reasoning. For the authors, the main doubt concerning this judgment is: ‘whether the Court has willingly or unwillingly opened the door to an obligation to drive thorough economic analysis in all abuse-related cases without exception’. The Commission decided – and the General Court agreed – that Intel’s rebates were by their very nature capable of restricting competition. This was based on the EU Courts’…

Kevin Coates  ‘The Intel CJ Ruling: More Than a Nudge towards Economic Analysis’

Even though this (very short) reaction piece – which can be found here – focuses mainly on the procedural part of the judgment, it also comments on more substantive matters. As regards extraterritoriality, he notes that AG Wahl had argued that it should be unlawful to bring together conduct which could have had no effect in the EU (e.g. a contract between Intel and an OEM in Asia, with products destined for Asia), with conduct that could have EU effects (e.g. a contract with products destined for the EU). The Court disagreed: the “conduct … viewed as a whole” should be taken into consideration to avoid “an artificial fragmentation of comprehensive anticompetitive conduct”. As regards the treatment of exclusive rebates, he argues that we have learned less than many had hoped. On the one hand, the CJEU seems to be making a procedural point: if the Commission relied on economic evidence, then the General Court should examine it. But other…

David Bailey ‘The New Frontiers of Article 102 TFEU: antitrust imperialism or judicious intervention?’ (2018) Journal of Antitrust Enforcement 6(1) 25-53

This paper – which can be found here – addresses the way in which EU competition law cuts across and interferes with other legal regimes such as pharmaceutical regulations (Astra Zeneca and patent settlement cases), energy rules (Gazprom) and data protection (Facebook). This has led to a debate about whether EU competition law and policy should be able to trespass on turf that is properly subject to other areas of law, and whether it is appropriate for it to act as a “repair service” for other fields of economic law that lack sanctioning mechanisms. The article is structured as follows: The second section examines four situations in which Article 102 TFEU controversially overlapped with a different area of law. Competition law applies to unilateral business conduct whenever there is an act (or omission) of a dominant undertaking that distorts the competitive process or is directly exploitative of consumers. On the other hand, the application of competition law is usually precluded by…

Thomas Hoppner ‘A Duty to Treat Downstream Rivals Equally: (Merely) a Natural Remedy to Google’s Monopoly Leveraging Abuse’ (2017) European Competition and Regulatory Law Review (3)208

This  paper – which can be found here – reviews the European Commission’s decision in the Google case, and the remedy that the Commission imposed in that decision. It argues that this decision follows settled law regarding anti-competitive extensions of dominance from a primary market to a distinct, but related, secondary market. It also seeks to refute the argument that the decision created a novel rule that a dominant company may not favour its own services – instead, it is argued that this requirement is merely the remedy that the Commission imposed to bring Google’s infringement to an end. The paper is structured as follows: A first section provides an overview of the decision and some critical reactions to it. The Commission fined Google for having abused its market dominance as a search engine by promoting its comparison shopping service, Google Shopping, and demoting rival services. Describing the abuse, the EC explained that it: “objects to the fact that Google…