Commercial Solvents v Commission (1974)

CSC made raw materials which were then used to make
drug for tuberculosis.
CSC acquired 51% of company, Istituto, which bought
raw materials from CSC and sold them to Zoja, who used them to manufacture
certain products.
Instituto tried unsuccessfully to buy Zoja.
Instituto then raised prices to Zoja.
Zoja found alternative source of supply.
Alternative source then dried up.
Zoja sought to re-order raw material from CSC, but CSC
refused as it wanted to integrate vertically downmarket.
ECJ held that undertaking in dominant position as
regards production of raw material and therefore able to control supply to
manufacturers of derivatives cannot, just because it decides to start
manufacturing these derivatives (in competition with its former customers) act
in such a way as to eliminate their competition.
[ECJ reasoning phrased in terms of vertical
Controversial – firm may integrate vertically for
efficiency reasons.
Case shows there may be situations where actions by
dominant firm will benefit consumers but harm competitors, and that if ECJ is
forced to chose it will chose latter.]