‘Exploitative abuses by powerful buyers: analysis of excessively low purchasing prices under Article 102 TFEU’
September 25, 2014 2 Comments
To kick-off a new academic year at the CCP, we were delighted to welcome Victoria Daskalova (Tilburg Law and Economic Center) on Wednesday 17th September who provided us with a thought-provoking presentation entitled ‘Exploitative abuses by powerful buyers: analysis of excessively low purchasing prices under Article 102 TFEU‘. A copy of her abstract can be found below.
Most of the complaints about buyer power in the food sector concern exploitative abuses. Farmers and small producers often claim that they receive unreasonably low purchasing prices, which are insufficient to cover their costs of staying in business. They also complain about the onerousness of the terms imposed on them by powerful purchasers. In these discussions, the application of the EU competition rules often comes into question. However, to what extent the competition rules could actually be applied, is not known due to the lack of enforcement.
The main research question addressed in this paper is: to what extent can exploitative abuses resulting from the exercise of buyer power be addressed under Art. 102 TFEU? What are the challenges and opportunities for plaintiffs, defendants and authorities? For the purposes of the analysis, the research distinguishes between excessive pricing claims and unfair trading terms, and proceeds to discuss excessive pricing claims. It firstly discusses the case law on excessive pricing. Then, it proposes a way in which the test could be adapted to situations involving excessive pricing claims in the context of buyer power. Finally, the paper gives examples of how the test could be applied so that unmeritorious claims are avoided, but scope remains for addressing situations in which buyer power has an undesirable effect.