Price Discrimination Under International Laws

Many jurisdictions and countries throughout the world have laws
regulating price discrimination. These laws vary widely with respect to
their specific provisions and the circumstances under which price
discrimination is prohibited or regulated. This chapter provides a brief
overview of the approach to the regulation of price discrimination in
each of the following regions: Europe (including the European Union,
Germany and Sweden); the Middle East and Africa (Israel and South
Africa); Asia (China, India, Japan, South Korea and Indonesia); North
America (Canada and Mexico); and South and Central America (Brazil
and Argentina).
A. Europe
The European Union (EU) is an economic and political partnership
between 27 European countries. The European Commission is one of the
main institutions of the EU and, working with national competition
authorities, directly enforces EU competition rules, Articles 101 and 1021
of the Treaty on the Functioning of the European Union (TFEU).2
1. These provisions were formerly Articles 85 and 86 of the Rome Treaty
signed March 25, 1957, which established the European Economic
Community effective January 1, 1958 among Belgium, France, Italy,
Federal Republic of Germany, Luxembourg, and the Netherlands.
Articles 85 and 86 were included in subsequent treaties relating to the
expanding European Economic Community, subsequently referred to as
the European Community and then the European Union. Effective May
1, 1999, the Amsterdam Treaty, signed October 2, 1997, available at, resulted in
renumbering Articles 85 and 86 as Articles 81 and 82 of what was then
generally referred to as the Treaty establishing the European Community
(TEC) or the EC Treaty. The Treaty of Lisbon, signed by the 27 EU
member states on December 13, 2007, went into effect on December 1,
2009 and resulted in the renumbering of Articles 81 and 82 of the TEC as
210 Price Discrimination Handbook
All national competition authorities in the EU are empowered to
fully apply the provisions of the TFEU to ensure effective competition.
In addition, national competition authorities administer and enforce the
member states’ own antitrust laws. National courts also may apply the
TFEU to protect the individual rights conferred to citizens by the TFEU.
In addition to the provisions of the TFEU pertaining to joint and
unilateral conduct (Articles 101 and 102), entities operating in the EU
must be mindful of member state laws that address price discrimination.
Member state laws are likely to continue to evolve as more state
governments seek to harmonize their competition laws with those of the
EU. It is beyond the scope of this handbook to address the relevant laws
of all 27 member states, but the laws of Germany and Sweden are
discussed below by way of example.
1. European Union
In contrast to the United States, the EU does not have a separate
statute addressing price discrimination. Articles 101 and 102 of the
TFEU are the general provisions addressing joint and unilateral
anticompetitive conduct. These provisions cover price discrimination
and are loosely equivalent to Sections 1 and 2 of the Sherman Act.
The European Commission (Commission) is charged with
investigating potential violations of Article 101 or 102, either on its own
initiative or in response to a member state’s request.3 Where it finds a
violation, the Commission is responsible for enforcing Articles 101 and
102 by issuing decisions that prohibit the conduct at issue, imposing a
fine, or both.4 Private European citizens also are entitled to bring actions
for damages caused by anticompetitive conduct, but such actions are not
Articles 101 and 102 of the Treaty on the Functioning of the European
Union [2002 O.J. (C 325) 33-184], available at http://eur- All EU
materials cited in this section are available at the EU’s website,
2. Consolidated Version of the Treaty on the Functioning of the European
Union, 2008 O.J. (C 115/01), available at http://eur-;EN;HTML.
3. Id. art. 105.
4. Id.; Commission Regulation 773/2004, 2004 O.J. (L 123) 18, amended by
Regulation 622/2008, 2008 O.J. (L 171) 3.
Price Discrimination Under International Laws 211
common as it is left to the individual member states to establish the
procedures for prosecuting such actions.5
a. Price Discrimination under Article 101
Article 101 of the TFEU prohibits agreements that restrict
competition and have an effect on trade between member states,
including agreements that “apply dissimilar conditions to equivalent
transactions with other trading parties, thereby placing them at a
competitive disadvantage.”6 However, Article 101(3) states that Article
101(1) may not apply if the agreement has procompetitive benefits, is not
unduly restrictive and does not have the potential to eliminate
competition for a substantial portion of the relevant market. Certain
regulations regarding this block exemption may limit its effect. For
example, vertical agreements are generally exempt, but not when they fix
minimum resale prices.7 Thus, Article 101’s prohibition on price
discrimination applies to all persons and entities if the practice is the
result of an agreement, but the provision allows procompetitive
justifications to overcome that prohibition in certain circumstances.
b. Price Discrimination under Article 102
Although price discrimination can violate Article 101, it often takes
the form of unilateral conduct and is, therefore, subject to Article 102.
Article 102 of the TFEU prohibits “[a]ny abuse . . . of a dominant
position within the internal market or in a substantial part of it” that may
affect trade between the member states.8 An example of such abuse of a
dominant position is “applying dissimilar conditions to equivalent
transactions with other trading parties, thereby placing them at a
competitive disadvantage.”9 Article 102 is stricter than Article 101 in its
application to price discrimination in that Article 102 has no potential
5. Case C-453/99, Courage Ltd. v. Crehan, 2001 E.C.R. I-06297, ¶ 23 (“the
Court has held that Article 85(1) of the Treaty and Article 86 of the EC
Treaty (now Article 82 EC) produce direct effects in relations between
individuals and create rights for the individuals concerned which the
national courts must safeguard”); Commission White Paper on Damages
Actions for Breach of the EC Antitrust Rules, COM (2008) 165 final (Feb.
4, 2008), at 2.
6. TFEU, 2 008 O.J. (C 115) art. 101(1)(d).
7. Commission Regulation 330/2010, 2010 O.J. (L 102) 1, art. 4(a).
8. TFEU, 2008 O.J. (C 115) art. 102.
9. Id. art. 102(c).

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