That are different from issues raised when a companys

that are different from issues raised when a company’s refusal aimed at eliminating a certain
competitor (Botta and Wiedemann, 2018). Although companies have the right to make decisions

EU Competition Law 5
on whether to deal with counterparties, a refusal to supply their products can amount into an
abuse in exceptional circumstances. Before imposing any restrictive conditions, Spielzug
company must consider various principles because firms which hold dominant positions in the
market are entitled not to hinder market entrance, an existing competition in the market or the
development of that competition. However, if a dominant company hinders the ability of other
firms to compete by imposing abusive practices such as different treatment of the customers, the
firm must provide additional justification for its actions (Botta and Wiedemann, 2018).
Legal Consequences of Pricing Conduct under the EU Competition La w
The EU competition has enforced rules that control the market power and also protect the
market dynamics and competitive structure and the rights of its member not to be excepted by
firms’ strategies with market power that are grounded on competitive merit. Article 82 of the
TFEU states that, undertakings can be prohibited from raising prices if the expansion is likely
designed to harm a competitor (Geradin and Petit, 2005). The European Commission can only
consider the price increase if the expansion in sufficiently profitable to the competitors, considers
barriers to expansion and also considers the risks and costs of failure. However, the given
scenario regarding the three manufacturers of electronic toy drones named W, X and Y involves
price expansion after every six months with a similar amount. Also, the prices for solar drone
components have been high for the last four years, thus making it difficult for the solar powered
drones’ manufacturers to compete with the manufacturers of battery powered drones. Applying
the EU rules in this case, firms have the market power to impose price expansion, but they
cannot manage to charge customers above the competitive price. Dominance is not a significant
issue for pricing to occur, but it is only in cases of firm dominance that pricing can be considered
abusive by the EU competition law (Geradin and Petit, 2005).

EU Competition Law 6
The EU competitive law protects the consumers’ welfare by increasing total surplus in a
given market. Accordingly, a free and open competition among undertakings benefits the
consumers by ensuring better products and lower prices (Qaqaya, 2008). In the given scenario,
the pricing behaviors among the three companies are unilateral behaviors that eliminate
competition from other manufacturers by harming their consumers directly. Marginal pricing
among the firms fails to remunerate organizations’ fixed price, which in future can fail to offer
incentives for companies to make effective investments in future. It is evident that, these firms