The European authorities have adopted the opposite approach stating expressly that the possibility of recouping losses is not a pre-condition of the finding of predatory pricing. case, the US Supreme Court has also added to the Areeda-Turner rule the “recoupment test”, according to which a predation strategy cannot be considered rational and must therefore be ruled out in the absence of any possibility for the undertaking to recoup its losses. Since the Brook Group vs Brown Williamson Tobacco Corp.
By contrast, prices lower than average total costs but higher than average variable costs must be regarded as abusive only insofar as they are set as part of a plan to eliminate a competitor. According to the Court of Justice, prices below the average variable costs must be abusive: a dominant undertaking has no reason to charge such prices other than to eliminate competitors and then to subsequently raise its prices by taking advantage of its monopolistic position, since each sale generates a loss, namely the total amount of the fixed costs and part of the variable costs. charging abnormally low prices to eliminate a competitor can, under certain conditions, fall within Article 102 TFEU. The EU authorities, following the example of US courts applying the Areeda-Turner rule, consider that a predatory pricing strategy, i.e.
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