THE ABUSE OF DOMINANCE THROUGH ADJACENT MARKET EXPANSION: A COMPETITION LAW ANALYSIS

Author

Aarti Kumari, Kuldeep Gautam, Prerna Shakya

Abstract

 The digitisation of markets has transformed the analytical problem at the heart of abuse-of-dominance law: firms dominant in one market increasingly leverage that position to capture adjacent, structurally connected markets through tying, bundling, self-preferencing, data leverage and platform design conduct that often escapes conventional price-cost tests. This paper examines abuse of dominance through adjacent market expansion under section 4 of the Competition Act 2002 (India), Article 102 of the Treaty on the Functioning of the European Union, and section 2 of the Sherman Act 1890 (United States). It traces the evolution of the leveraging theory of harm from Hoffmann-La Roche through Tetra Pak, Microsoft and the Google trilogy of cases, and undertakes a close doctrinal analysis of the Competition Commission of India's decisions in the Android and Play Store matters against their European and American counterparts. It argues that while the essential facilities doctrine and the equally-efficient-competitor test remain useful heuristics, digital ecosystems demand a recalibrated framework attentive to multi-sidedness, network effects and non-price harms, and evaluates the turn toward ex-ante regulation  the EU's Digital Markets Act and India's proposed Digital Competition Bill 2024 as a response to the structural limits of ex-post enforcement.

Keywords

abuse of dominance, adjacent markets, leveraging theory, Section 4 Competition Act, Article 102 TFEU, essential facilities doctrine, digital markets, Google Android, self-preferencing

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References

The abuse of dominance through adjacent market expansion sits at the analytical frontier of contemporary competition law. The doctrinal apparatus developed across four decades from Commercial Solvents and Tetra Pak through the American and European Microsoft litigation to the Google trilogy and, in India, from MCX Stock Exchange v NSE to the Android and Play Store decisions demonstrates a remarkable degree of substantive convergence in the identification of harm, even as the three jurisdictions examined in this paper retain meaningfully different statutory architectures, evidentiary thresholds, and institutional appetites for structural intervention.

That convergence is, however, increasingly a convergence toward a shared diagnosis of institutional inadequacy rather than toward a shared confidence in the existing ex-post model itself. The Competition Commission of India's Android and Play Store decisions represent the doctrine's high-water mark in India to date, and their substantial affirmance by the NCLAT alongside their close alignment with the European Commission's own Android findings confirms section 4(2)(e) as a robust and internationally credible tool for policing cross-market leverage. But the multi-year gestation of each of these proceedings, from initial complaint to final appellate resolution, and the persistent remedial caution evident even in decisions that find liability, illustrate why regulators in Brussels, Berlin and now New Delhi have concluded that ex-post enforcement alone cannot adequately discipline the compounding, self-reinforcing dynamics of adjacent-market leverage in digital ecosystems.

The Digital Markets Act and India's proposed Digital Competition Bill 2024 should accordingly be understood not as displacing section 4 and Article 102 TFEU, but as a structurally complementary second layer, designed to arrest the specific mechanisms of adjacent-market foreclosure self-preferencing, tying, exclusivity and data leverage at a stage where behavioural remedies remain meaningful, before network effects entrench a dominance that an ex-post abuse finding, arriving years later, can do little more than formally condemn. Whether India ultimately enacts its Digital Competition Bill in a form that achieves this objective without imposing disproportionate compliance burdens on a still-developing digital economy remains, as this paper goes to press, an open and consequential question for Indian competition policy.

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