CYIL vol. 13 (2022)

CYIL 13 ȍ2022Ȏ IMPACT OF COVIDǧ19 ON COMPETITION LAW AND POLICY Given the very limited demand on the undertakings’ side, we concur that the competition authorities should not return to the practice of routinely issuing comfort letters; we rather support a more robust guidance in the form of general guidelines, as indicated above. 3. Tackling Excessive Prices The pandemic caused surge in demand for certain products, in particular face masks and sanitizing gels, which immediately amounted to steep increase of their prices. It might have been suggested that the resulting prices were excessive. Competition law defines excessive prices as prices that have “ no reasonable relation to the economic value of the product supplied” ; 44 this amounts to profit margin that is unfair, “ either unfair in itself or when compared to competing products ”. 45 Even though the number of competition cases concerning excessive prices has generally been low in the EU, this topic has re-emerged at the beginning of the COVID crisis: “ it is of utmost importance to ensure that products considered essential to protect the health of consumers in the current situation (e.g. face masks and sanitising gel) remain available at competitive prices. The ECN will therefore not hesitate to take action against companies taking advantage of the current situation by cartelising or abusing their dominant position”. 46 Indeed, several European competition authorities opened investigation of excessive pricing. 47 Without going into details concerning the theory of abuse of dominant position and admitting that it is very difficult in practice to prove this particular form of abuse, 48 we should pay special attention to the very first step of every analysis, i.e. whether an undertaking holds a dominant position. Dominant position is defined as “ a position of economic strength enjoyed by an undertaking which enables it to hinder the maintenance of effective competition on the relevant market by allowing to behave to an appreciable extent independently of its competitors and customers and ultimately of consumers ”. 49 Market shares play a vital role while indicating dominance; typically, dominant undertakings have a market share exceeding 40%. 50 In case of the products mentioned above, however, most of the producers or sellers would hardly reach the market shares indicated above; thus, dominant position on a classical sense is hard to imagine. Some authors 51 nonetheless point to an older decision of the Commission, European Parliament, the Council, The European Economic and Social Committee and the Committee of the Regions Report on Competition Policy 2020 of 7 June 2021 (SWD(2021) 177 final), p. 23. 44 CJ EU judgement 27/76 United Brands , para 250. 45 Ibid , para 252. 46 Joint statement of the ECN on application of competition law during the Corona crisis ( op. cit. ). 47 In detail, see e.g. GIOSA, P. Exploitative Pricing in the Time of Coronavirus – The Response of EU Competition Law and the Prospect of Price Regulation. Journal of European Competition Law and Practice , 2020, No. 9, p. 499, including Poland. 48 BAILEY, D., JOHN, L. E. Bellamy & Child. European Union Law of Competition . Eighth Edition. Oxford University Press, 2018, p. 931. 49 CJ EU judgement 322/81 Michelin v. Commission , para 57. 50 BAILEY, D., JOHN, L. E. ( op. cit. ), p. 873 et seq . 51 GIOSA, P. ( op. cit. ), p. 502.

355