The European Commission's Draft Guidelines on Exclusionary Abuses: A Law and Economics Critique and Recommendations

The European Commission's Draft Guidelines on the application of Article 102 TFEU to exclusionary abuses aim to enhance legal certainty, help undertakings to self-assess the conformity of their conduct with Article 102 TFEU and guide the National Courts and National Competition Authorities. We welcome the prospect of Guidelines on Article 102 TFEU and endorse the stated aims of the Draft Guidelines. From an economics perspective, we also welcome the possible use of rebuttable presumptions for certain practices. However, in some cases (eg tying) such presumptions do not seem appropriate from that perspective. Further, the approach of the Draft Guidelines to presumptions seems to imply a reversal of the burden of proof, which the EU Courts might arguably not accept. The Draft Guidelines move away from an economic, effects-based approach and do not fully acknowledge or embrace the modern legal approach of the EU Courts to Article 102 TFEU. As they currently stand, the Draft Guidelines offer limited guidance because they are arguably inconsistent with the case law and they lack clarity in many respects. The Draft Guidelines can be improved by: connecting the concept of 'competition on the merits' to harm to consumers; incorporating central concepts such as 'theory of harm'; paying more than mere lip service to the 'as efficient competitor' principle; introducing safe harbours; and, offering clarifications on the scope of certain presumptions (some of which, indeed, have economics support) and their rebuttal.