OECD kpcdb

 

1. Scope

Article 6 determines that dominant undertakings are prohibited from abusing their dominant positions to eliminate or restrict competition.

According to Article 17 sets out an illustrative list of prohibited conducts, that include conduct, that without justification configure excessive prices, below-cost sales, refusals to deal, exclusive or designated dealing, tying or imposing other unreasonable transactional terms and discriminatory treatment. The agencies have the power to determine and sanction other acts of abuse of dominant market positions, not explicitly mentioned in Article 17.

2. Assessment

Under Article 17(2), a dominant market position is defined as a market position held by undertakings that are capable of controlling the prices or quantities of commodities or other transaction terms in a relevant market, or preventing or exerting an influence on the access of other undertakings to the market.

According to Article 18, z dominant market position is determined on the basis of the following factors:

a)     its share on a relevant market and the competitiveness of the market

b)     its ability to control the sales market or the purchasing market for raw and semi-finished materials

c)      its financial strength and technical conditions

d)     the extent to which other business mangers depend on it in transactions

e)     the difficulty that other undertakings find in entering a relevant market

f)       other factors related to the determination of the dominant market position held by an undertaking.

The Rules of the Administration for Industry and Commerce on the Prohibition of Dominant Market Position elaborate on each of those factors.

According to Article 19, an undertaking is assumed to hold a dominant market position in any one of the following circumstances:

a)     the market share of one undertaking accounts for half of the total, in a relevant market

b)     the joint market share of two undertakings accounts for two-thirds of the total, in a relevant market

c)      the joint market share of three undertakings accounts for three-fourths of the total, in a relevant market

However, under the circumstances specified in (b) and (c) above, if the market share of one of the undertakings is less than one-tenths of the total, the undertakings are not considered to have a dominant market position.

3. Remedies and sanctions

According to Article 47, where an undertaking in violation of the AML abuses its dominant market position, the enforcement authorities shall instruct it to cease its conduct, confiscate its unlawful gains and, in addition, impose on it a fine of not less than 1% but not more than 10% of its sales achieved in the previous year.