Anti-Competitive Rebates

In the Research Handbook on Abuse of Dominance and Monopolization, published by Edward Elgar in April 2023, Vicky Robertson contributed a chapter on rebates, detailing the antitrust rules applicable to loyalty or fidelity rebate schemes under EU competition and US antitrust law. The chapter finds that antitrust liability for a dominant company will more readily be established in the EU, where the applicability of economics-based tests is still being navigated. In the US, rebates by a monopoly player will usually be found to be anti-competitive where they constitute predatory pricing, although they might also run into antitrust liability where they constitute exclusive dealing arrangements. This divergence can be explained by the different ideological underpinnings in the two jurisdictions. Overall, however, the (case) law on loyalty rebates is still in a state of flux in both jurisdictions. In recent years, both jurisdictions have gradually moved to a little more convergence in their treatment of exclusivity rebates. At this point, however, both the US Supreme Court and the European Court of Justice will need to weigh in on the future of the antitrust assessment of loyalty-inducing rebates.

The Handbook is edited by Pınar Akman, Or Brook (both University of Leeds) and Konstantinos Stylianou (University of Glasgow). It can be found here.