In 2001, the European Commission found that the French firm Michelin had – via its various types of rebates – abused its dominant position in the French markets for new replacement tyres and retreaded tyres for heavy vehicles, and imposed a fine of €19.76 million to Michelin. Two years later, the Court of First Instance upheld the Commission's Decision in its entirety.
In many respects, this case is exemplary of the strict formalistic approach followed in abuse of dominance cases by the European Commission and the Community Courts, which severely limits the possibility of dominant firms to resort to certain business practices, such as exclusive dealing, rebates and tying. Indeed, the EU case law has so far disregarded the actual effects of the allegedly abusive practices (the Commission does not need to prove that exclusionary effects have indeed taken place, nor does it need to show that consumers have been hurt), the mere possibility that they could distort competition being enough for a finding of infringement of Article 82 of the Treaty. As a matter of fact, Michelin II is even stricter than previous decisions and judgments because for the first time it is found that a dominant firm cannot even resort to pure (non-individualised) quantity discounts, a practice until then accepted by the Courts.
Perhaps, though, the very fact that it pushed a formalistic interpretation of Article 82 to its limit will paradoxically and unintentionally make Michelin II a judgment which will contribute in a positive way to European competition law.