Concept of Economic Dependence in Business Regulation

Abstract

Economic dependence and prohibition of abuse thereof are traditional institutes of competition law. Although we cannot observe it in EU competition law, it exists and it is used very efficiently in many national laws. By prohibition of abuse of economic dependence it solves a crucial problem of prevention of abuse of dependent party position. The analysis is through and it embraces both law and practice. Comparing economic dependence and dominance as well as abuse thereof author identifies common and different features. Elements of power, influence on counterparties, ability to define their mode to conduct business and absence of any viable alternative are those in common. The different features are those connected with quantitative characteristics of the market dominance and the scale of the market power. Abuse of the economic dependence as well as abuse of market dominance also have much in common, especially if so called “contract related” abuses are in question. However author believes that the scope of the application of these prohibitions is absolutely different although the practices in question may look similar in similar situations. It is worth adding that prohibition of abuse of economic dependence covers and thus is capable to solve the problems that the prohibition of the abuse of dominance is unable to solve. In addition contract models admissible under traditional competition law are prohibited if applied to establish economic dependence or to abuse thereof. Upon the results of the comparison author believes that economic dependence is one of the categories of the economic law with very wide application scope and high functionality.