Decrypting the Concept of Abuse of Dominant Market Position: Trends in India and EU

Abstract

“With great power, comes great responsibility.” The above quote by Stan Lee, also known as the Peter Parker principle, beautifully describes the concept of market dominance. It is this underlying principle that forms basis of Section 4 of the Indian Competition Act 2002 (the Act), resonating the same principle across major competition law regulations globally. Healthy competition is the essence of a productive market space. It therefore rightly follows that the Act does not forbid enjoyment of market dominance, monopoly or a position of strength by an enterprise. However, almost like the object of any other law, it aims to bring about a level playing field by restricting the abuse or rather misuse of such dominance to the prejudice of a non-dominant market player. The term abuse of dominant position refers to anti-competitive business practices in which a dominant firm may engage in order to maintain or increase its position in the market. These business practices by the firm, not without controversy, may be considered as abusive or improper exploitation of monopolistic control of a market aimed at restricting competition. Holding an enterprise accountable for the ‘abuse of dominance’ is not free from its own challenges. The regulating agencies have to tread with caution or they risk acting as a deterrent to growth. In this paper we examine what amounts to ‘abuse of market dominance’ by doctrinal research and case study method. This paper explores how major market players should regulate their conduct to in order to not fall within the perilous Section 4 of the Law. Although the focus of this paper is on India, it also seeks inspiration from the approach in other jurisdiction (particularly the European Union) to understand the interpretation of certain concepts.