Abuse of Dominance

Section 18 of the Competition Act 1998 prohibits any conduct on the part of one or more undertakings which amounts to the abuse of a dominant position in a market if it may affect trade within the United Kingdom — a rule known in the Act as the Chapter II prohibition. The section gives non-exhaustive examples of conduct capable of constituting abuse, including directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions, limiting production, markets or technical development to the prejudice of consumers, applying dissimilar conditions to equivalent transactions with other trading parties so as to place them at a competitive disadvantage, and tying the conclusion of contracts to acceptance of unrelated supplementary obligations.

The prohibition applies only to undertakings that already hold a dominant position — it does not prevent a firm from becoming dominant through competition on the merits, only from exploiting or entrenching that position abusively once achieved. Dominance and abuse are both assessed by reference to the relevant market, and the prohibition mirrors Article 102 of the Treaty on the Functioning of the European Union, which continues to apply in parallel to conduct affecting trade between EU member states.