Pricing abuses: An overview of EU and national case law

Allegations of pricing abuses have tested the boundaries of competition law for more than a century and remain an important activity for many competition authorities and courts. While pricing abuses constituted key parts of some early antitrust cases, many commentators have urged that they are best addressed outside competition law. Since the 1970s such matters have been addressed at the European Union level. Pricing abuses can be viewed as a hybrid between regulation and competition law enforcement, sometimes raising a question of principle over when pricing that takes advantage of market power should be prevented by competition law action, by regulation or simply left unchallenged. The incentive effects on companies from such cases are likely substantial. In predation, margin squeeze and rebates and excessive pricing cases, companies may have practical difficulty in making quick ex ante assessments whether their pricing policies are illegally low (in the case of predation and rebates) or illegally high (in excessive pricing cases) or some combination of too high and/or too low (in margin squeeze). This paper reviews recent experience in the EU, where new developments have occurred at a rapid pace.