Leaving aside the rights and wrongs of the Microsoft case, what would happen if a Microsoft-type case occurred in Ireland? Could a business operating in Ireland be punished and broken up for abusing dominance? Is the Irish position different from the US?
There is no doubt that Irish competition law is as tough as US antitrust law.
The dominance rules are very relevant in Ireland. In a relatively small economy, with fewer competitors in each market, it is easier to be dominant in Ireland than in many other countries.
Some of these dominant businesses are semi-state companies, while others are dominant national and multinational companies.
A business is dominant where it has sufficient market power to act, to an appreciable extent, independently of its competitors and customers. A business which abuses its dominance in Ireland or "a substantial part" of Ireland can be severely punished under Irish law. Irish law, like US law, does not prohibit dominance. Instead, it is only the "abuse" of dominance which is prohibited.
Under Irish law, businesses abusing dominance may be broken up, fined and sued for damages and punitive damages.
The fines can be up to £3 million (€3.8 million) or 10 per cent of turnover, whichever is higher. Moreover, directors and executives may be fined up to £3 million and imprisoned for up to two years.
A business could also be broken up under Section 14 of the Competition Act, 1991. The provision has not yet been used and some legal commentators suspect that it is unconstitutional.
Nonetheless, it is important to control dominant businesses. The Competition and Mergers Review Group recently advised the Minister for Enterprise, Trade and Employment, Ms Harney to repeal Section 14. It would be strange if Ireland were to repeal this provision given that it is used so extensively abroad.
Abuses of dominance would include predatory pricing, unjustifiable refusal to supply, excessive pricing and even inefficiency. The fact that inefficiency may be an abuse of dominance may have considerable significance for a number of Irish businesses.
How would a Microsoft-type case arise in Ireland? Competition lawyers can file a complaint with the Competition Authority or the European Commission.
Equally, proceedings may be brought before the Circuit Court or High Court, claiming damages and punitive damages, injunctions and declarations. The Minister for Enterprise, Trade and Employment and the Competition Authority may also seek injunctions and declarations.
Claims of abuse of dominance are growing in number and importance. Irrespective of the rights and wrongs of the Microsoft litigation, the principles in the case are ones which could be applied in the Irish context.
Mr Vincent Power is a partner at A & L Goodbody and head of the EC competition and regulatory law unit.
