NMa Suspects LOI of Thwarting Competitor

The Netherlands Competition Authority suspects Waldeck B.V., the parent company of Leidse Onderwijsinstellingen (LOI) and Studieplan, of abusing its dominant position on the Dutch market for private correspondence education. NMa has evidence that Waldeck, through its subsidiary Studieplan B.V., since 1997 has systematically tried to drive its competitor Nationale Handels Academie (NHA) from the market by means of a policy of selectively undercutting prices.

The behaviour of a dominant undertaking aimed at driving a competitor from the market is a serious infringement of the Competition Act. Although consumers benefit from the lower prices in the short term, the effect of this in the long term will probably be that the undertaking will increase its prices considerably. Were NHA to disappear from the market, Waldeck B.V. would acquire an almost monopolistic position.

NMa suspects that NHA has found itself in considerable financial difficulties as a result of Studieplan's pricing policy. NMa therefore intends to impose a provisional order subject to a penalty on Waldeck B.V. By doing so, NMa can oblige the organisation to cease its current pricing policy in relation to NHA to ensure that NHA's competitive position does not deteriorate further in the short term. Both Waldeck and NHA have two weeks in which to give their opinion of NMa's intention. After this, NMa will determine whether an infringement has been committed and, if so, whether it will impose a provisional order subject to a penalty.

In August 2002 NMa started an investigation into the behaviour of Studieplan, following a complaint by NHA regarding Studieplan's pricing policy, which was aimed at driving NHA from the market by charging prices which were too low.