Essential Facility and Efficiency in European Antitrust. Some Lessons from GVG/FS in the Railway Sector

This paper investigates the economic rationale in defining an essential facility also considering the evolution of competition policy decisions in US and EU. In particular, we propose a test to distinguish between an abusive refusal to deal by a dominant firm and the application of the essential facility doctrine. We apply the test to a specific antitrust case regarding the railway sector in Italy. We conclude that in the GVG/FS case the European Commission went too far in defining incumbent’s locomotives as an essential facility for competitors to enter the Italian market. In our view, the Commission’s application of the essential facility doctrine in that case was redundant with respect to sanction a simple refusal to deal and had the potential to reduce consumers welfare. Moreover, the EU decision was somehow conflicting also with the regulatory framework promoted at the European level.