Abuse of Dominant Position and Other Competition Law Investigations
German and European competition and antitrust law do not allow for the abuse of a dominant position. The German authorities have prohibited specific practices that threaten effective competition. Such prohibitions can even extend to actions used to attain a dominant market position and those involving markets where they do not have a dominant position.
Under German legislation, a company can be considered “dominant” where it does not have substantial competition or has a prominent market position. Determining whether these factors are in place is decided on a case-by-case basis where the company is assessed in an overall appraisal of all criteria relevant for competition. German antitrust and competition law does not base its definition on specified market shares. Instead, determining factors include the availability of appropriate resources for competition, barriers to market entry, switching costs for customers and the buying power of the opposite market side.
The abuse of dominance arises when the company’s practices are considered discriminatory against other businesses or impede their competition opportunities. Actions that may amount to the abuse of a dominant position include predatory pricing, exclusive dealing, loyalty rebates, calling for a boycott of third parties and refusal to deal.
The Bundeskartellamt has the power to act against abusive conduct. It can do so by taking administrative proceedings against the company and then ordering that the abusive behaviour be discontinued. They can also impose fines on companies that are found guilty.