Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

Monday, July 11, 2011

Excessive Prices within EU Competition Law

Posted by D. Daniel Sokol

Liyang Hou, ICRI-KULeuven-IBBT, Catholic University of Leuven (KUL) - Interdisciplinary Centre for Law and ICT (ICRI) explores Excessive Prices within EU Competition Law.

ABSTRACT: Due to the different views in economics the prohibition of excessive prices is among the most controversial subjects within EU competition law. This article aims to shed some light on this concept. In the following, it first identifies the exceptional circumstances that may justify antitrust actions against excessive pricing. Subsequently, an empirical research is undertaken on the two-step analytical framework established by United Brands: first, analysing whether the profit margin is excessive; if affirmative, then assessing whether the price is unfair in itself or compared with others. In particular, it focuses on the three uncertainties within that framework: (i) determining an excessive profit margin, (ii) examining whether a price is abusive in itself, and (iii) demonstrating an abusive price based on benchmarks.

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