UK Competition and Markets Authority Backs Off From Loyalty Rebate Abuse Probe

    View Author July 2015

    A recent decision by the Competition and Markets Authority to close an abuse of dominance investigation into a loyalty-inducing discount/rebate program offered by a pharmaceutical firm suggests a continuing reluctance on the part of the CMA to devote resources to complex abuse of dominance probes whose outcome is uncertain. However, the fact that the CMA investigated the matter for a year, together with more active enforcement by other European competition authorities of such cases, shows that firms which may be dominant cannot afford to be complacent and need to ensure their conduct can withstand such regulatory scrutiny. The CMA’s announcement also provides a useful summary of the CMA’s approach to when a dominant firm’s discount/rebate scheme may be an abuse.