EL SUBDIRECTOR GENERAL DE TECNICA TRIBUTARIA DE LA DIRECCIÓN GENERAL DE RENTAS

Article 2 of the Treaty of Rome provided that one of the objectives of the new institution was to achieve “a harmonious development of economic activities”.165

Article 3166 expanded on the objectives of the Community, providing that the activities of the Community shall include, inter alia, “the institution of a system ensuring that competition in the common market is not distorted”.167

It is worth noting that the Treaty of Paris did not have any explicit reference to the protection of competition in its objectives; and it is believed to be due to the gradual development of competition policy within the Common Market. The Treaty of Paris, as discussed above, not only recognised but also stressed the importance of undistorted competition for the fulfilment of the Community’s objectives. Article 5 of the Treaty of Rome provides that “Member States shall take all appropriate measures, [...], to ensure the fulfilment of the obligations arising out of this Treaty”. This provision is placing an obligation on the Member States to apply all appropriate measures in order to protect competition within the Common Market, which is one of the Community’s objectives.

The Treaty of Rome was the first to codify competition provisions.168 Articles 85 and 86 were the main competition provisions, i.e. provisions which include the set of prohibitions the violation of which would subject the parties to punishment. Article 86 was influenced by Article 66 of the Treaty of Paris as both have the same legislative aims behind them. However, it was argued that the final wording of Article 86 allowed the Treaty of Rome to go beyond of so-called limited objectives of Article 66 of the Treaty of Paris.169 Generally, the comparison between the two is not very important as it will not provide a clearer picture as to the wording and intention of the competition provisions. This comparison is, however, necessary in order to show a gradual development of competition rules on abuse of market power in the EU.

165 _{The further objectives of the Community under Article 2 are “a continuous and balanced expansion, an} increase in stability, an accelerated raising of the standard of living and closer relations between the States belonging to it”.

166 _{Article 3 of the Treaty of Rome is equivalent to Article 3 of the Treaty of Paris.} 167 _{Ibid. Article 3(f).}

168 _{See, Articles 85-94 of the Treaty of Rome.} 169

38

Before proceeding to the text of Article 86, it is necessary to mention that on 1 December 2009 the Treaty of Lisbon entered into force; creating a new treaty arrangement for what is now the EU, in which the foundation treaties are the TFEU, and the Treaty on European Union (‘TEU’). The TFEU re-numbered the main competition provisions in the Treaty of Rome. Therefore, Article 86 of the Treaty of Rome,170 which became Article 82 EC, is now Article 102.

Article 102 TFEU provides, 171

“Any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States”.172

Therefore, according to the wording of Article 102 in order for an anticompetitive abuse to take place a firm must be in a dominant position. It was argued that the language of Article 102 “was intended to regulate the conduct of dominant firms and to prevent dominant firms from unfairly using their power, not merely to prevent them from expanding or protecting their power”.173 And this argument is entirely correct; however, it is important to identify the extent to which the Commission and the courts follow the language of Article 102. The terms ‘abuse’ and ‘dominant position’ have been trusted upon to the courts for interpretation; however, it was argued that “both the structure of the Treaty and

170

The text of what is now Article 101 has remained unchanged since 1958 save for the substitution of ‘internal market’ for ‘common market’ in 2009.

171 _{Please note that the main wording of Article 102TFEU remained the same apart from the principle of} “common market” in Article 82 EC was replaced by the principle of “internal market” in Article 102 TFEU. This did not change the core idea of competition provisions in Article 102 TFEU. See Consolidated version of the Treaty on European Union—Protocol (No.27) on the internal market and competition OJ C115/309. 172 _{The text of Article 102 continued: Such abuse may, in particular, consist in:}

(a) directly or indirectly imposing unfair purchase or selling or other unfair trading conditions; (b) limiting production, markets or technical development to the prejudice of consumers;

(c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;

(d) making the conclusion of contracts subject to acceptance by other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

173 _{Fox, E., M., “We Protect Competition, You Protect Competitors” [2003] 26(2) World Competition 149 at} p. 157.

39

the continental legal tradition may constrain the potential for growth and development of the operative meanings of these provisions”.174