Abuse of dominance in Morocco

Abuse of dominance

How is abuse of dominance defined and identified? What conduct is subject to a per se prohibition?

Abuse is not defined by Moroccan law. However, article 7 of the Law specifies that the abusive exploitation of a dominant position is prohibited if the abusive exploitation has ‘as an object’ or ‘may have as an effect’ to prevent, restrict or distort competition. Article 7 also provides a non-exhaustive list of examples of abuses such as refusal to sell, tying sales, discriminatory selling conditions, termination of an established commercial relationship on the sole ground that the partner refuses to consent to unjustified commercial conditions and direct or indirect imposition of a minimum resale price for goods or services or of a minimum sales margin.

Therefore, it appears that Moroccan law follows both an effects-based and a form-based approach to identify abusive practices.

Does the concept of abuse cover both exploitative and exclusionary practices?

The concept of abuse covers both exploitative (eg, tying sales to consumers in opinion No. 22/12 relating to competition between banks and insurance agents and brokers concerning presentation of insurance) and exclusionary practices (eg, refusal to sell in the opinion relating to the market of the sale of plane tickets and the opinion relating to competition in Marrakech’s movie sector in 2013).

What link must be shown between dominance and abuse? May conduct by a dominant company also be abusive if it occurs on an adjacent market to the dominated market?

The holding of a dominant position is needed for the application of article 7 but the decisional practice of the Competition Council still has to clarify whether a causal link must be shown between dominance and abuse and under which conditions a conduct can be abusive if it takes place on an adjacent market to the dominant market.

What defences may be raised to allegations of abuse of dominance? When exclusionary intent is shown, are defences an option?

Under article 9 of the Law, the prohibition of abuse of dominance shall not apply:

• when the practices result from the implementation of an act or regulation (see, for instance, opinion No. 26/10 of 13 November 2012 relating to the market of maritime transport of Casablanca’s tramway train sets in which the Competition Council considered that a company, which had issued a call for tenders and had rejected a tender because of the Moroccan nationality of the tenderer, had not abused its dominant position because its selection was made in conformity with agreements between France and Morocco); and
• to the practices whose perpetrators can prove that they have the effect of ensuring economic or technical progress, including by creating or maintaining jobs, and that they reserve for users a fair share in the resulting profit, without giving the undertakings involved the opportunity to eliminate competition for a substantial part of the products or services in question. Those practices may impose restrictions on competition only insofar as these are essential to achieve this aim of progress (see, for instance, the opinion relating to the movie sector in Marrakech of 2013 in which the Competition Council took into account the fact that a dominant company accused of refusal to sell had made substantial investment for the development of the sector).

Moreover, certain categories of agreement or certain agreements, in particular when they are intended to improve the management of small or medium-sized undertakings or the marketing of farmers’ products, may be recognised as meeting the conditions set out in article 9 by the administration after a favourable opinion from the Competition Council.

It is, thus, possible to invoke efficiency gains. The Competition Council has not pronounced itself yet on whether defences are an option when exclusionary intent is shown but the requirement not to eliminate competition on the market makes it difficult for an exclusionary practice to meet the exemption conditions.

Further, agreements of minor importance that do not appreciably restrict competition (in particular, agreements between small and medium-sized companies) may also fall outside article 7 of the Law.