Neodyum Miknatis
Casino Siteleri
canli poker siteleri meritslot
escort antalya
istanbul escort
sirinevler escort
antalya eskort bayan
Short Reads

On the right track? GC sends mixed messages with Lithuanian Railways

On the right track? GC sends mixed messages with Lithuanian Railways

On the right track? GC sends mixed messages with Lithuanian Railways

03.12.2020 NL law

The essential facilities doctrine imposes on holders of indispensable facilities a duty to deal with their competitors. While a railway track may seem essential, a track’s removal does not fall under this doctrine if carried out by a monopolist manager of a state-developed facility bearing a statutory obligation to grant third parties access to its facilities.

According to the General Court, the Commission was therefore correct to use the general framework for abuse of a dominant position to assess the Lithuanian railway operator’s removal of a railway track.

For dominant companies controlling facilities which may be qualified as essential to their potential competitors, this judgment helpfully recognises the protection granted to investment incentives, but also seems to limit the scope of application of the essential facilities doctrine. The decision may have future relevance for tech industry’s ‘gatekeepers’ and the potential qualification of data as an essential facility.

In 2017, the Commission imposed a EUR 27 million fine for abuse of dominance on Lietuvos Gelezinkeliai (LG), the Lithuanian national railway company. The abuse concerns a 19km railway track, stretching from an oil refinery in Lithuania to the Latvian border. The owner of the refinery, an LG customer, was in negotiations to switch services to the Latvian national railway company (LDZ). LDZ needed the track if it was to make a competitive offer. Coincidentally, in the same period, the track was damaged, leading LG to quickly remove it. The removal meant that a longer alternative route through Lithuania had to be used, making LDZ’s offer uncompetitive.

LG appealed to the General Court, which rejected the appeal on substantive points, but reduced the fine in the exercise of its unlimited jurisdiction.

The essential facilities doctrine imposes on holders of indispensable facilities a duty to deal with a competitor if a strict standard is met: the refusal to deal will likely eliminate competition, there is no objective justification and the facility is indispensable. The General Court rejected LG’s claim that the track removal should have been reviewed under this framework, which balances the protection of competition with that of companies’ incentive to invest in the creation of essential facilities. LG’s dominant position derived from a state monopoly, therefore there was no investment to protect. Further, the legislator had carried out this balancing exercise when it imposed a regulatory obligation on LG to supply access to the railway.

The track removal had to be assessed under the general framework for abuse, and was found to be capable of hindering LDZ’s market entry by making its access to the market more difficult. LG had a special responsibility not to impair genuine, undistorted competition on the market and had failed to meet this responsibility.

Even though the General Court disagreed on substance with LG, it reduced the fine by a third as the conduct concerned a limited geographical space and affected only one of various rail routes between Latvia and Lithuania.

This ruling underlines the narrow scope of application of the essential facilities doctrine that, according to the General Court, only comes into play where the dominant undertaking’s investment incentives need protecting. The essential facilities doctrine was recently revamped in the context of tech industry ‘gatekeepers’ and the potential qualification of data as an essential facility. The Commission’s Digital Markets Act – due to be published on 15 December 2020 – is likely to further clarify how this doctrine fits into the plans to further regulate gatekeepers.    



This article was published in the Competition Newsletter of December 2020. Other articles in this newsletter:



Related news

07.01.2021 NL law
Commission evaluates Antitrust Damages Directive: to be continued

Short Reads - On 14 December 2020, the Commission published a report on the implementation of the Antitrust Damages Directive (the Directive). The Commission observes a significant increase in antitrust damages actions since the adoption of the Directive. However, there is insufficient experience with the new Directive to properly evaluate its application. Instead, the Commission provides a concise overview of the implementation of some key aspects of the Directive.

Read more

07.01.2021 NL law
Amsterdam District Court puts a halt to unlimited forum shopping

Short Reads - On 25 November 2020, the Amsterdam District Court (the Court) declined jurisdiction over all non-Dutch defendants (the foreign defendants) in proceedings for compensation of damage based partly on an infringement of Article 101 TFEU. The proceedings were initiated by four public utility companies from the Gulf States (claimants) against both Dutch and foreign defendants.

Read more

07.01.2021 NL law
ACM study calls for regulation of Big Techs on payment market

Short Reads - The ACM’s market study, published on 1 December 2020, provides an overview of recent and upcoming developments concerning the role of Big Tech companies in both online and offline payment markets in the Netherlands. Although Big Tech companies currently have a relatively limited presence in these markets, the ACM expects significant expansion in the near future given these companies’ ability to leverage existing market power on other (platform) markets.

Read more

07.01.2021 NL law
Do the math: ACM publishes strategy on monitoring use algorithms

Short Reads - The ACM worries that the use of algorithms may lead to the creation of cartels, or nudge consumers towards a purchasing decision that is not in their best interest. Therefore, on 10 December 2020, it published a new policy document (in Dutch) setting out what businesses can expect when the ACM checks their algorithms. On the same day, the ACM also launched a trial with online music library Muziekweb to improve the ACM’s knowledge about the categories of data that are likely to be relevant in such investigations. All signs indicate the ACM’s intention to become more active in this area.

Read more

07.01.2021 NL law
(Geo)blockbuster: Canal+ ruling annuls commitment decision

Short Reads - A heads-up for companies seeking to settle in antitrust proceedings: commercially-affected third party complainants are not to be ignored. The Canal+ judgment marks the first time a commitment decision has been successfully challenged since the adoption of Regulation 1/2003. The European Court of Justice annulled the commitment decision on the ground that the Commission failed to take into account the rights of contractual parties affected by the commitments.

Read more