Page 82 - Azerbaijan State University of Economics

STUDYING OF SPECIAL PRACTICAL ISSUES OF ABUSE OF DOMINANCE

In most jurisdictions private conduct that is required by regulatory

intervention or by law is not subject to antitrust remedies; only practices in
situations in which firms enjoy some freedom of choice are so constrained.

Conduct by regulated firms outside the market in which they enjoy special or

exclusive rights is most likely to be subject to antitrust scrutiny. Regulated
monopolies have an incentive to extend their dominant position through

exclusionary practices into other markets to gain unregulated monopoly
profits.

In Telsystem v. Sip, the Italian national telecommunications company,
which has a legal monopoly over the public-switched network, refused to

lease lines to a smaller company wishing to compete in providing closed user

groups services, which had been liberalized under a European directive.
Denial of access caused losses and closed the market to the potential

competitor, denying also a service to consumers. The Italian Antitrust

Authority ruled that the unjustified refusal was aimed at preserving a
dominant position in a relevant market different from that in which the

monopolist has exclusive rights. The authority decided that such behavior
was an abuse of a dominant position.

Another case involving exclusive rights granted to state-owned
companies, Sign v. Stet-Sip, concerned access to telephone subscribers’ lists

by a would-be competitor in the market for information services to

subscribers. In Italy, as in many other countries, the national telecom-
munications company has exclusive rights over production and distribution

of subscribers’ lists and holds dominant positions in downstream activities
that use these lists to sell services to consumers and businesses. The refusal

to sell subscribers’ lists on CD-ROM or to provide access to the on-line
database to prospective new entrants was considered an abuse of a dominant

position by the Italian Antitrust Authority. The authority observed that no

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