Pursuant to the Curacao rules on competition, the abuse of a dominant position held by one or more undertakings is prohibited. Just like most other terms, the term dominant position is copied from the European rules on competition and is to be interpreted in the same way.
Case law of the Court of Justice of the European Union indicates that a dominant position is a position of economic strength enjoyed by an undertaking, which enables it to prevent effective competition being maintained on the relevant market by affording it the power to behave to an appreciable extent independently of its competitors, customers and ultimately of its consumers.
European case law indicates that undertakings that have a market share of 65% or higher are, as a rule, dominant. This is irrespective of the number of other competitors. To create legal certainty, the Curacao rules on competition determine that a market share of 60% or higher means that the undertaking concerned has, by definition, a dominant position. In principle, low market shares cannot sufficiently affect market conditions. The general rule is, therefore, that market shares of less than 30% can never create a dominant position.
What about undertakings that have market share between 30% and 60%? In those cases, market shares in relation to each other, combined with other factors, will be decisive whether an undertaking holds a dominant position. Although a relatively high market is a presumption for a dominant position, it will rarely be sufficient alone. The general rule is that market shares between 30% and 60% constitute a dominant position in situations where that market share is at least twice the share of the next highest market share of another competitor. If that is not the case, other factors will have to be taken into consideration as well. Examples of other market power factors are applicable legal provisions, superior technology or knowledge, vertical integration, product differentiation and access to capital.
You may also be interested in Peter’s blog about ‘New rules on competition’ and ‘Undertakings’.
If you have questions about our Competition Scan and/or want to know how the Curacao rules on competition can affect your business, please feel free to contact Peter van Dort via peter@legallaw.blog or dort@liance.law or +5999 5133 678.
