• Denmark: the Competition Appeals Tribunal Upholds the Danish

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• Denmark: The Competition Appeals Tribunal upholds the Danish Competition Council’s Decision finding that Post Danmark A/S abused its Dominant Position by applying Loyalty Rebate Schemes On 10 May 2010, the Danish Competition Appeals Tribunal (CAT) issued a ruling upholding the Danish Competition Council’s (DCC) decision against Post Danmark A/S (Post Danmark) for abusing its dominant position by applying illegal rebate schemes and finding an infringement of both Section 11 of the Danish Competition Act and Article 102 TFEU. The case concerns the distribution of "direct mail” which is a sub-market of the market for the distribution of bulk mail in Denmark. Direct mail is identical bulk mail sent out as part of advertising campaigns. There are two market players on the market for the distribution of direct mail in Denmark: Post Danmark and Bring Citymail Denmark A/S (Citymail). Post Danmark distributes various mail types in all of Denmark. Post Danmark’s only competitor on the market for bulk mail, Citymail, distributes bulk mail to a large part of North Zealand, including Copenhagen. Citymail is owned by the Norwegian Bring Group, which belongs to Posten Norge, which again is owned by the Norwegian state. Citymail exited the Danish market on 1 January 2010. The CAT upheld entirely the findings of the DCC according to which Post Danmark had abused it dominant position by applying a rebate scheme with respect to its direct mail distribution, which entailed that the customers could obtain retroactive rebates on their direct mail. These rebates were greater than for regular mail. In order to obtain the rebate the customers had to send out at least 30 000 mail items per year or mail items at a total worth of DKK 300 000 (approximately € 40 300). Each shipment had to include a minimum of 3 000 mail items. The rebates were scaled into different levels. The rebate of 16 % was the highest rebate level. As the rebate scheme was retroactive, the DCC had found that it would be costly for Post Danmark's customers to use another distributor for their direct mail. On 24 June 2009, the DCC found that Post Danmark had abused its dominant position by means of illegal rebate schemes and, thus, found that Post Danmark had infringed both Section 11 of the Danish Competition Act and Article 82 EC. The DCC stated that the rebate scheme applied by Post Danmark with respect to its direct mail distribution included loyalty rebates which foreclosed actual and potential competitors. The rebate scheme was found to have a foreclosure effect as it was deemed too expensive for the customers to use competitor(s)' services. The DCC ordered Post Danmark to cease applying the illegal rebate schemes and, thus, to amend its rebate schemes accordingly. See further: the CAT’s ruling is available in Danish here Press spokesperson: Head of Unit Martin Windelin; [email protected] .

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