A supplier may select his clients on the basis of objective, transparent and non discriminatory criteria

Resolutions of the CNC of 14 November 2011 (Call forwarding) and of 1 December 2011 (Google); Judgment of the High Court of Justice of Madrid of 18 October 2011


Resolutions of the CNC

The Spanish Competition Authority (CNC, for its Spanish acronym) has recently issued two resolutions (“Call forwarding” and “Google”) arising from customer complaints who considered that they had suffered unjustified refusals of service provision and discriminatory treatment, which implied an abuse of the dominant position of the companies against which the claims were brought (Vodafone and Google, respectively).

In said resolutions, the CNC considers that the fact that a company holds a dominant position in a relevant market does not imply that such company is obliged to provide services to all the clients that request it, although it does generate a special responsibility in order to avoid falling into abusive practices. In this sense, the CNC points out that companies holding a dominant position must have the freedom and commercial autonomy to select their clients and to adapt their tariffs to the different realities existing in the market, as long as they base their decisions on objective, transparent and non discriminatory criteria.

Since it has not been proven that the companies against which the claims were brought offered any unjustified discriminatory treatment, the CNC concludes in both cases that there is no evidence of infringement of the rules on competition and it decides not to initiate any disciplinary proceedings, and no further action will be taken.

It also applies to the pharmaceutical sector

In the pharmaceutical sector, a recent Judgment of the High Court of Justice of Madrid (TSJM) also ruled in favor of the freedom of enterprise, and rejected the appeal lodged by a wholesaler (Europea de Servicios y Distribuciones) against the Directorate General of Pharmacy and the Spanish Medicine Agency because they did not answer his request for protection of the wholesalers’ right to be supplied by pharmaceutical companies. The wholesaler also requested the imposition of a penalty on the company which denied him the supply.

The TSJM rejected all the arguments of the wholesaler and concluded that the law does not establish in any way a general or absolute right for wholesalers to be supplied by pharmaceutical companies. The court considered that the wholesalers’ right to be supplied which is contemplated in article 70.2 of Law 29/2006, of 26 July, must be interpreted in the light of article 68.1 of such law, which establishes that pharmaceutical companies may distribute medicinal products directly or through wholesalers. Therefore, the wholesaler’s right to be supplied depends on whether the pharmaceutical company uses its services for the distribution of its medicines.

Furthermore, the TSJM considers that although shortage of supply of some medicines has been proven, there is no evidence that such shortage was brought about by an incorrect distribution by the pharmaceutical company.

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