(New Zealand) The company had been found guilty under the Act of abusing its dominant position. The appeal was restricted to whether the dominant position was being used in the way suggested. Would the company have introduced its price cuts if it had not had the dominant position it did have.
Held: ‘while it is legitimate to infer ‘purpose’ from use of a dominant position producing an anti-competitive effect, it may be dangerous to argue the converse that because the anti-competitive purpose was present, therefore there was use of a dominant position.’ The court appeared to have wrongly inferred an abuse of the dominant position. A dominant firm uses its position of dominance when it engages in price-cutting with a view to recouping its losses without loss of market share by raising prices without fear of reprisals afterwards. Price-cutting is not a badge of the use of dominance, and the court must give appropriate weight to the counterfactual test. Appeal allowed (by a majority)
Judges:
Lord Bingham of Cornhill, Lord Hope of Craighead, Lord Scott of Foscote, Baroness Hale of Richmond, Lord Carswell
Citations:
[2004] UKPC 37
Links:
Statutes:
Citing:
Cited – Telecom Corporation of New Zealand Ltd v Clear Communications Ltd 1995
(New Zealand) A trader is entitled, before he enters upon a line of conduct which is designed to affect his competitors, to know with some certainty whether or not what he proposes to do is lawful. The meaning and effect of section 36 of the 1986 . .
Cited – Queensland Wire Industries Pty Ltd v Broken Hill Pty Co Ltd 1989
(Australia) The operation of section 46 of the 1974 Act, is predicated on the assumption that competition is a means to the end of protecting the interests of consumers: ‘Competition by its very nature is deliberate and ruthless. Competitors jockey . .
Cited – AKZO Chemie BV v Commission of the European Communities ECJ 3-Jul-1991
Europa Regard for the rights of the defence requires that the undertaking concerned shall have been enabled to make known effectively its point of view on the documents relied upon by the Commission in making the . .
Cited – Tetra Pak v Commission ECJ 14-Nov-1996
When defining the relevant market for the purpose of applying Article 86 of the Treaty, the competitive conditions and the structure of supply and demand on the market are relevant criteria for determining whether certain products are . .
Lists of cited by and citing cases may be incomplete.
Commonwealth, Commercial
Updated: 11 June 2022; Ref: scu.198903