European Competition and Regulatory Law Review: Application of United Brands Test for Excessive Pricing in Digital Sector

In the latest issue of Competition and Regulatory Law Review (CoRe), Ellex experts Martin Mäesalu and Miikael Tuus discuss a recent case of the Estonian Competition Authority on excessive pricing in the digital sector.

The Estonian Competition Authority (ECA) issued two decisions on April 18, 2024, addressing potential excessive pricing in digital markets. The cases involved real-estate classifieds portals kv.ee and city24.ee, and automotive classified portal auto24.ee, both investigations were concluded with no breach findings.

Existing EU legal practice has developed a framework that could also be applied to digital sector pricing cases – the so-called United Brands test. Although said test has not been developed with digital sector cases in mind, the United Brands test could still provide a preliminary framework for assessing excessive pricing even in so called new economy cases. Developed test still leaves open the (arguably most difficult) question on how to quantify a relative (economic) value of a product or a service. On that there is not much practical guidance from neither the EU nor national level practice.

In determining the economic value of goods, account must be taken of non-cost factors such as: aspects relating to the demand for the goods and the characteristics of the goods which make them valuable. The ECA entered into this landscape with its investigations in the kv.ee/city24.ee and auto24 cases.

Read more in the CoRe issue no 2 of 2024 available here.

The European Competition and Regulatory Law Review reports on key legislative developments in the EU and its Member States and analyses important judgments that shape the field of EU competition and regulatory law, in particular those by the European Courts, international courts and tribunals, and higher national courts.

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