Legal uncertainty and competition policy: The case of long-term vertical contracting by dominant firms in the EU electricity markets

Long-term vertical contracts remain a pervasive feature of European electricity markets and despite wide concerns over the ability of de-integrated markets to ensure an optimal allocation of risks, the Commission has constantly voiced strong concerns over their anti-competitive effects. However, due to the lack of decisions in electricity and the on-going modernization of EC competition policy, perceived legal uncertainty is strong. This article proposes to explore the degree of uncertainty in the Commission decisional practice following the recent line of cases in other energy sectors. The article comes up with two conclusions. First, legal uncertainty is largely overstated as both the methodology to analyze these contracts in energy and its implementation principles are clearly emerging. Second, competition enforcement in energy quickly converges with enforcement in other sectors.