The Design of the Optimal Abuse Tests

Abstract

AbstractThe objective of competition law is to maximise long-term social welfare. However, an abuse test that required proof that the conduct under review reduces long-term social welfare would lack both the qualities that a legal test should possess: certainty and administrability. It is therefore necessary to frame a test, or several tests, that, by relying on elements other than direct proof that a reduction of competitive pressure on the dominant firm has a negative impact on long-term social welfare, are capable of distinguishing conduct that is harmful to competition from precompetitive behaviour. This chapter discusses the possible abuse tests applicable to exclusionary, exploitative, and discriminatory abuses. It starts by asking the fundamental question of whether, from a normative standpoint, there should be one abuse test. It then goes on to examine the tests that have emerged in the literature or in the case law. The tests are discussed in the following order: intent, which also includes naked exclusion, naked exploitation, and naked discrimination; no economic sense; as efficient competitor, which also includes the test for abusive discrimination; and consumer harm, covering both exclusionary and exploitative abuses. The conclusion of this chapter sets out the test that, from a normative point of view, should apply to exclusionary, exploitative, and discriminatory conduct.