Lawyer - Abuse of a dominant position

In an increasingly competitive economic environment, being accused of abusing a dominant position or falling victim to it can have serious consequences. This type of anti-competitive practice, defined by Article L. 420-2 of the French Commercial Code and Article 102 of the TFEU (Treaty on the Functioning of the European Union), exposes companies to administrative sanctions, fines and a high risk of litigation.

Our firm works alongside companies facing these challenges: market analysis, defence in the context of an investigation by the Competition Authority, preparation of a referral file, contractual strategy. Whether you are being challenged or are the victim of exclusionary or abusive practices, we can provide you with a rigorous approach, combining legal expertise with a detailed understanding of market dynamics and their economic impact.

Solent Avocats is a Marseille-based law firm specialising in business law, commercial law and anti-competitive practices. Our practice is based on a foundation of cross-disciplinary skills, including business litigation, civil liability and contractual strategies. Convinced that knowledge should be disseminated, we regularly publish teaching content and take part in certified professional training courses.

Understanding abuse of a dominant position

Abuse of a dominant position does not refer to market power per se, but to its use in a manner that is contrary to competition. In other words, a company can dominate a market without breaking the law, unless it exploits this position to drive competitors out of business or impose unjustified trading conditions.

The applicable legislation - both French and European - prohibits a wide range of practices: unjustified refusal to sell, price discrimination, tying, predatory pricing, making the conclusion of a contract conditional on the acceptance of additional services, and the brutal termination of commercial relations. Such behaviour, if committed by a company with sufficient market power, can be classified as an abuse.

As set out in Article 102 of the Treaty, any abuse of a dominant position in the internal market is prohibited if it is liable to affect trade between Member States. The European Commission and the Court of Justice interpret these rules strictly.

How to identify a dominant position

The starting point is always the delimitation of the "relevant market", i.e. the exact area in which supply and demand operate: a given type of product or service, in a specific geographical area.

Once this perimeter has been defined, several criteria can be used to assess a dominant position:

• a high market share, often in excess of 40 % ;

• the existence of barriers to entry (legal, economic, technological) ;

• unilateral negotiating power over customers or suppliers.

This diagnosis is fundamental. It is based as much on economic factors as on a detailed reading of the applicable law. Indicators such as margins, economic power and control over outlets can be used to deduce the existence of a monopoly or a situation of indirect domination.

Sanctioned practices: exclusion or exploitation

Abuse can take very different forms depending on the objective pursued.

Some practices aim to exclude competitors :

• exclusivity clauses imposed on customers or distributors ;

• denial of access to essential infrastructure ;

• prices too low to be sustainable (predatory pricing) ;

• price squeeze, which makes it impossible for an intermediary to be viable;

• tied sales with no objective link to the main product.

Others correspond to a abuse of exploitationfor example:

• excessive prices charged to customers ;

• unfair or discriminatory trading conditions;

• selling additional services without justification;

• unequal treatment between partners for equivalent conditions ;

• unjustified disadvantages imposed on consumers.

In each case, the challenge is to demonstrate abuse of market power, contrary to free competition and business law.

Our support in cases of abuse of a dominant position

Solent Avocats is involved in three main types of configuration:

• In defence Are you being challenged by a competitor or the Authority? We intervene from the very first notification to ensure that your interests are protected. This includes preparing for investigations, drafting observations, and developing a litigation response strategy before the AMF or the Commercial Court.

• On request Is your company the victim of abusive behaviour? We can help you qualify the practice in legal terms, assess the impact on competition, build a convincing case and take action (referral to the Autorité or civil liability action).

• Prevention Our services: we carry out compliance audits of your commercial practices, draft or revise your sensitive contractual clauses, and help you define pricing policies that are compatible with European regulations and French law.

Why work with us?

Abuse of a dominant position is a hybrid subject, at the crossroads of law, economics and corporate strategy. It requires both technical expertise and practical sense.

Our firm stands out for :

• a dedicated practice of competition law and anti-competitive practices;

• an in-depth knowledge of the Competition Authority's investigation mechanisms and analysis methods;

• the ability to combine a litigation approach with strategic advice, depending on your profile (SME, public player, large company, trade union, etc.);

• constant education: we explain the issues, the risks, the opportunities - and above all, the choices.

Informing strategy: preventing risks and structuring compliance

Abuse of a dominant position may arise from an ill-calibrated strategy or inappropriate contractual conditions. A distribution contract, a discriminatory pricing policy or the imposition of unwanted additional services may be indications of inappropriate use of market power.

Our firm offers a bespoke prevention and compliance service, including :

• analysis of the general terms and conditions of sale ;

• review of relations with business partners ;

• review of contracts likely to restrict access to the market;

• modelling economic development strategies that are compatible with the rules of free competition.

This approach applies just as much to leading companies as to fast-growing ones, particularly in technology or regulated sectors, where the effect of indirect monopoly can appear quickly.

Preventing disputes often means avoiding costly litigation and heavy financial penalties.