Abuse of Dominance in Tech: Comparative Analysis of Margin Squeeze Claims Against U.S., EU, and Korean Telecommunications Firms

Roh, Alex Hyojung | March 5, 2024

Telecommunications network operators around the world are often characterized as natural monopolists. Only one or few telecommunications firms control nationwide networks through which all other ancillary service providers reach their customers. Many jurisdictions, including the United States, European Union, and Korea, seek to prevent such powerful market players from abusing their dominance by regulating their business conduct under competition law. This Note focuses on the regulation of “margin squeeze,” whereby a dominant firm leverages its market power in one market with the intent to monopolize a separate but related market. The United States does not currently impose a standalone antitrust liability based on margin squeeze, whereas the European Union has established that margin squeeze constitutes a standalone abuse. In 2021, the Korean Supreme Court adopted a similar approach to the European Union. A comparative analysis reveals that the Korean Supreme Court has judicially created the notion of margin squeeze based on a notable statutory ambiguity. Korean competition law authorities must resolve this ambiguity through legislative reform based on thoughtful policy choices that adequately reflect the purpose of competition law.