CJEU rules on ‘abuse of dominance’ involving digital platform access

In an important preliminary reference judgment, the CJEU has ruled that Google’s refusal to ensure interoperability between its Android Auto platform and the JuicePass app developed by Enel may constitute an abuse of a dominant market position, in breach of EU competition law.

This is the latest EU court judgment to consider when large technology firms may in certain circumstances be obliged, under EU competition law, to grant access to their services – such as operating systems, digital platforms or devices – to third party businesses such as app developers.

The case originated in Italy where Enel, an energy company, developed the JuicePass app to help electric vehicle drivers locate and reserve charging stations. Enel requested Google to make its app compatible with Android Auto, a system that allows smartphone apps to be accessed directly on a vehicle’s onboard screen. However, Google refused, citing security and technical concerns.

The Italian Competition Authority (AGCM) fined Google over €102 million in 2021, finding that the refusal hindered competition and innovation. Google contested the fine before two Italian courts, ultimately leading to a referral to the CJEU for a preliminary ruling. The CJEU’s findings on the application of relevant EU competition principles will assist the Italian appellate court to finally determine the case.

The CJEU has found that Google’s refusal to ensure interoperability could indeed constitute an abuse of its dominant position in breach of article 102 of the Treaty on the Functioning of the European Union (TFEU). The court emphasised that such a refusal can amount to an abuse of dominance if the firm’s digital platform was developed with the view of third parties using and accessing the platform so they can make the uptake and use of their own apps more attractive to consumers.

However, the court also acknowledged that there could be legitimate reasons for the dominant firm refusing interoperability with its digital platform, namely “where to grant such interoperability by means of such a template would, in itself and in the light of the properties of the app for which interoperability is sought, compromise the integrity or security of the platform concerned, or where it would be impossible for other technical reasons to ensure that interoperability by developing such a template”,

Outside of such situations, however, “the fact that there is no template for the category of apps concerned” at the time that access is requested, or that there are “difficulties involved” in developing such an interoperability template, cannot by itself constitute an “objective justification” for refusing access to the digital platform, the CJEU said. In such cases, the dominant undertaking will have to develop the necessary template within a reasonable period, but may charge the third party an appropriate fee for this service.

The judgment distinguishes EU competition law precedent stemming from the landmark Bronner case, where the “essential facilities” doctrine was established. In Bronner the CJEU held that, where a dominant firm – in this case, a newspaper firm – has developed certain infrastructure solely for its own use, refusal to grant access will constitute an abuse of dominance in breach of EU competition law under certain circumstances. First, if access to the dominant firm’s infrastructure is indispensable to carrying on the third party’s business because no alternative infrastructure existed. Second, the refusal is likely to eliminate all competition on the relevant market where the access seeker operates, and third, the refusal cannot be objectively justified.

In the present case, however, the CJEU held that “where a dominant undertaking has developed infrastructure not solely for the needs of its own business but with a view to enabling third-party undertakings to use that infrastructure”, the Bronner indispensability criteria do not apply.  “Refusal is capable of constituting an abuse of a dominant position even though that digital platform is not indispensable for the commercial operation of the app concerned on a downstream market,” the CJEU said.

Accordingly, in the digital platform and technology context, a third-party access seeker does not have to demonstrate that its access to the dominant technology firm’s platform or ecosystem is “indispensable” in order for the tech firm’s access refusal to amount to a breach of EU competition law.  

The CJEU also noted that a refusal to give a third-party app access to the digital platform may be “capable” of having anticompetitive effects, even if other competing third-party apps are able to operate and grow without such interoperability access. The extent to which the dominant firm’s refusal to grant access to its digital platform will affect competition on the market for such third-party apps will depend on the relevant factual circumstances.  

The case will now return to the referring court in Italy, to be determined in light of the CJEU’s guidance.

The CJEU judgment adds to evolving case law on exclusionary abuses that may breach of article 102 TFEU, an area which is the focus of new guidelines the European Commission is currently developing.  Notably, the EU’s relatively new digital markets competition regime, embodied in the Digital Markets Act (DMA), was shaped by various principles distilled from EU competition law cases. The DMA imposes a range of pro-competition obligations on “gatekeeper” digital platforms in respect of their designated core platform services, including interoperability requirements.