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ARTICLE · 30 OCTOBER 2015

What Discount Structures Can A Dominant Firm Use?

Reed Smith (Worldwide)
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The European Court has given further guidance on how to assess the legality of rebates and discounts offered by dominant firms in a case concerning rebates practised by Post Danmark.

European UnionAntitrust/Competition Law
Edward Miller
Edward Miller
Marjorie C. Holmes
Marjorie C. Holmes
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The European Court has given further guidance on how to assess the legality of rebates and discounts offered by dominant firms in a case concerning rebates practised by Post Danmark1, which at the relevant time enjoyed a statutory monopoly in Denmark for next day postal deliveries.

Post Danmark operated a unitary rebate scheme, which applied to bulk mail services both within the scope of the statutory monopoly (next day delivery) and outside it (delivery in two or three days). Post Danmark ended up with both a monopoly on next day bulk mail and a 70% share of after next day bulk mail. The essential case against Post Danmark was that it was employing a discount structure to leverage its monopoly and achieve or maintain dominance in a related segment where it was subject to competition.

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