District Court Amsterdam rules real estate platform Funda did not abuse its dominant position
On 21 March 2018, the District Court of Amsterdam delivered its judgment in a dispute between two real estate associations (VBO Makelaars and NVM) over the online platform of Funda Real Estate (Funda). The Court dismissed VBO's claim that Funda abused its dominant position by applying discriminatory contract terms.
Funda owns the website www.funda.nl, which serves as an online real estate platform in the Netherlands. The Dutch Association of Real Estate Agents (NVM) is co-founder of the website and indirectly holds shares in Funda. Other real estate agencies such as VBO Makelaars (VBO) have agreements with Funda, which allow their members to post property on the Funda website. However, NVM members receive preferential treatment in terms of cost, use of website functionalities and the ranking of properties. VBO argued that Funda was abusing its dominant position by applying unequal terms to VBO.
To determine the relevant market and whether Funda had a dominant position on this market, the District Court appointed not less than three economic experts. On the basis of their expert advice, the District Court found that Funda had a dominant position on the online housing market in the Netherlands. With respect to the abuse, the District Court noted that VBO had to demonstrate that the alleged discrimination tended to distort the competitive position of VBO. Discrimination alone is insufficient to establish an abuse.
Relying on a recent opinion of Advocate General Wahl in the case of MEO/Autoridade da Concorrência, the District Court stated that whether the discrimination affected VBO's ability to exert competitive pressure should also be determined. To that end, it was necessary to examine the actual or potential effects of the conduct.
The District Court concluded that VBO had not shown that the discrimination in relation to the costs or the access to the site's functionalities tended to distort its competitive position. In relation to the preferential treatment of NVM agents' property listings, the expert advice also showed that there was no clear indication that this tended to distort VBO's competitive position. As a result, the District Court ruled that Funda had not abused its dominant position.
The case follows a trend where claimants that allege an abuse of a dominant position directly take their case before the civil courts, instead of submitting a complaint to the ACM. The benefit of taking the civil court route is that the case cannot be dismissed on the basis of a priority policy (like the ACM), but – as shown in this case – it remains difficult to establish the existence of an abuse.
This article was published in the Competition Law Newsletter of April 2018. Other articles in this newsletter:
1. District Court rules on the preliminary defences in CRT case
2. First Dutch excessive pricing case in pharma may be expected soon
