The most important sections of the Dutch Competition Act cover the prohibition of cartels, the prohibition of abuses of dominant positions, and the legal boundaries to concentrations.
Cartels
If you as a company make arrangements with competitors about prices or market-sharing, you form a cartel. Cartels harm consumers, because prices are increased or consumers have less choice. Cartels impede competition. That is why cartels are prohibited. Companies are allowed to work together though. If no more than eight companies work together, and their combined turnover is no higher than €5.5 million in case of goods or no higher than €1.1 million in case of services, they are allowed to cooperate. Alternatively, if the combined market share of the companies that cooperate does not exceed 5%, and their combined turnover is not higher than €40 million, they are also allowed to cooperate.
Dominant positions
Is your company so large that other companies barely have the opportunity to sell their products or services? Or is your market share so high that other companies’ actions are basically irrelevant to your company? If so, you may have a dominant position. Companies can have such positions starting from a market share of 40% already. Abusing that position could easily happen. You might unreasonably raise prices, or cut prices in order to push competitors off the market. These are clear examples of abusing a dominant position. And that is what is prohibited.
Concentrations: mergers and acquisitions
If companies join forces (merger) or if one company take over another (acquisition), the newly formed company is a stronger and bigger player on the market. That may impede competition. That is why mergers and acquisitions must meet certain conditions. The NMa must be notified in advance of concentrations with a combined turnover exceeding a certain threshold. The combined turnover cannot exceed €113,450,000. In addition, at least two of the companies involved must each have a turnover in the Netherlands of €30,000,000. If the companies involved do not meet these thresholds (based on the previous year’s turnover), it is not required to notify the NMa of the merger or acquisition.
