New EU Guidelines on Abuse of Dominance: Recalibrated Framework, With Ample Room for Aggressive Enforcement

A "Workable Effects" Approach for the Digital Economy

The Guidelines aim to codify recent EU court rulings and update the enforcement framework for today's economic realities. The EC emphasizes that markets are increasingly concentrated and digitalized, driven by network effects and winner-takes-all dynamics that, in its view, require vigorous enforcement. While the 2008 Guidance embraced a purely economics-driven, effects-based approach, the new Guidelines adopt a "workable effects approach": Economic analysis remains important but is no longer the sole determinant of abuse, which can rely on other elements, such as qualitative evidence and rebuttable presumptions.

Notably, despite the focus on digital market features, the Guidelines do not address the interaction with the Digital Markets Act, which remains applicable in parallel.

Dominance

The Guidelines rely on established case law whereby dominance is likely above a 50% market share but unlikely below 40%, while placing higher emphasis on digital ecosystems and data-driven advantages. The dominance section also introduces a four-condition cumulative test for after-market dominance (informed customer choice, likelihood of exercising it, sufficient customer adaptation, and timeliness of response), providing the first systematic framework for when primary-market competition disciplines after-market power. The treatment of collective dominance based on tacit coordination is noteworthy for the EC's candid acknowledgment that Article 102 has "been enforced only rarely" in this area while signaling that algorithmic coordination may change this, as algorithms can facilitate tacit coordination "in more complex environments." Finally, the section recognizes buyer-side dominance as within the scope of Article 102, indicating that the Guidelines' principles apply by changing those things that need to be changed.

Presumptions of Abuse: Scaled Back, but Still Powerful

The August 2024 draft drew criticism for its heavy reliance on presumptions of anticompetitive effects, effectively placing the burden of proof on defendants. The Guidelines narrow the scope of these presumptions but still shift the evidentiary burden to undertakings to demonstrate that conduct deemed, by its very nature, to be harmful to competition should nonetheless not be regarded as abusive. Dominant companies engaging in such conduct must therefore be prepared to bear the full evidentiary burden of rebutting those presumptions. The Guidelines further adopt a graduated approach, under which certain forms of conduct, such as self-preferencing, are not presumed to be abusive and must instead be assessed under the general legal test to demonstrate harm to competition..

Restatement of the General Test and Economics-Based Defense Narrowed

The Guidelines confirm the general test for exclusionary abuse: Conduct must depart from "competition on the merits" and produce exclusionary effects likely to harm consumers. Key aspects include:

• Consumer Welfare Standard: It would not be necessary to prove consumer harm as part of the legal test itself. However, consumer welfare, including reduced choice and higher prices of diminished innovation, may be taken into account as part of a broader body of indicia supporting the assessment.
• Specific Conduct Frameworks: The Guidelines restate tests for practices such as tying, bundling, and predatory pricing, with limited novelties.
• Behavioral Factors: Consumer inertia and behavioral biases are expressly recognized as relevant factors in assessing exclusionary effects.
• Self-Preferencing Test: The Guidelines establish a three-factor framework: (i) an important, nonreplaceable leveraging market; (ii) unjustified differential treatment; and (iii) likely influence on user behavior.

The "as-efficient competitor" test remains the standard for the assessment of pricing conduct, but the Guidelines no longer require it for non-pricing conduct. The EC can rely on qualitative evidence, barriers to entry or expansion, or the impact on innovation and consumer choice to establish abuse. That said, where a dominant company submits a price–cost analysis in support of a non-pricing practice, the EC is required to examine its probative value.

Justifications and Efficiencies: High Bar, New Sustainability Defense

The Guidelines provide expanded guidance on justifications, which must be documented early. To succeed, a dominant company must demonstrate cumulatively that the conduct: (i) is indispensable; (ii) creates verifiable efficiencies; (iii) produces benefits that outweigh the negative effects; and (iv) does not eliminate all or most sources of competition. Efficiencies from related but separate markets may count toward the defense.

In a notable development, the Guidelines recognize sustainability benefits as valid efficiencies for the first time under Article 102 TFEU, including "out-of-market" efficiencies where collective benefits extend beyond the relevant market. The "objective necessity" defense also has broad scope, ranging from legitimate commercial to technical considerations and including public interest objectives, but only when supported by concrete evidence. The considerations regarding the indispensability assessment appear to put a high bar to successfully claim efficiencies.

Exploitative Abuses Remain a Blind Spot

Guidance on exploitative abuses is absent from the Guidelines. Although certain practices have long been recognized as exploitative, the lack of a structured analytical framework for their assessment increases the risk of competition law being used to pursue broader objectives. Recent case law and enforcement initiatives demonstrate that theories of exploitative abuse are increasingly invoked in ESG-type complaints or procedures often linking antitrust enforcement to other societal or regulatory objectives.

Furthermore, several exclusionary abuses are also ignored, despite enforcement in the areas, such as price parity clauses, anticompetitive acquisitions, and disparagement. Compliance in these areas will thus remain based on developing case law and enforcement practices only.