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Antitrust: restrictive agreements and dominance

Article 24(1) of the Competition Act prohibits the abuse of a dominant position. The Dutch prohibition is substantively the same as that found in EU competition law (with the exception that the Dutch prohibition does not require an effect on trade between Member States). A dominant position exists where an undertaking can exert market power. As in EU competition law, a rebuttable presumption of dominance exists where the market share of an undertaking exceeds 50 per cent.

In June 2017, the ACM published its decision of 22 May 2017 to impose a fine of nearly €41 million on the Dutch passenger rail transport incumbent, the NS. According to the ACM, the NS abused its dominant position on the main railway network during a public tender for public transport services in a region of the Netherlands. According to the decision, the abuse took place on markets adjacent to the market on which the NS has a dominant position, and the two infringements were predatory pricing in the form of submitting a loss-making bid for the regional tender and a combination of impediments that cumulatively constitute abuse of dominance.

The ACM concluded that the loss-making bid submitted by the NS constitutes predatory pricing. The ACM performed an ex ante assessment of the bid, and used the NS' internal investment manual to assess whether the submitted bid was considered as a positive business case. According to the decision, the investment manual prescribes that a business case is considered positive if the internal rate of return is higher than the weighted average cost of capital. The ACM considered that a bid with an internal rate of return lower than the weighted average cost of capital set by the NS constitutes predatory pricing. It also considered that the business case presented in NS' bid was too positive, inter alia, because NS' expectation of the growth of revenue from passengers was too high. The ACM argued that the internal rate of return would be below the weighted average cost of capital if the NS used a more realistic prognosis in its business case.

According to the decision, the second infringement consisted of hiring a director from a competitor and acquiring confidential information from that director; sharing requests for access by competitors with the NS' own bidding team, and delaying and providing incomplete answers to those requests; and favouring the NS' own bidding team by only providing them with important information on revenue from travellers.

In March 2018, the ACM dismissed the NS' internal appeal against the ACM's decision.