Abuse of Dominance UAE: Pricing, Refusal to Deal & Market Power

Holding a powerful market position is not illegal in the UAE. A business may become large because it innovates, invests, operates efficiently, develops superior technology or offers a product that customers strongly prefer. Competition law intervenes when that market power is used in a way that distorts, restricts, lessens or prevents competition.

The principal framework is Federal Decree-Law No. 36 of 2023 Regarding the Regulation of Competition, supported by Cabinet Resolution No. 3 of 2025 and, from 30 July 2026, Cabinet Resolution No. 59 of 2026 as the current Executive Regulation.

The 2026 Executive Regulation significantly develops the analysis of dominance. It confirms that market share remains important, but also requires attention to pricing power, customer dependence, financial strength, technological advantages, barriers to entry, substitutes, adjacent-market presence and exclusive or long-term commercial relationships.

For businesses with substantial market positions, the compliance question is therefore not simply: “Are we above 40%?” It is also: “Can we act independently of competitive pressures, and are our commercial practices capable of foreclosing competitors, exploiting dependent customers or reducing consumer choice?”

Article 6 prohibits abuse, not dominance itself

Article 6 of Federal Decree-Law No. 36 of 2023 applies to an undertaking that, individually or together with other undertakings, holds a dominant position in the relevant market or in a substantial and influential part of it.

The undertaking is prohibited from engaging in conduct that constitutes an abuse where the object or effect is to distort, lessen, restrict or prevent competition.

This distinction is fundamental. A successful business is not required to become less efficient simply because it is dominant. But once dominance exists, pricing, distribution, exclusivity, access, supply and customer-treatment policies require closer competition-law scrutiny.

The 40% benchmark establishes dominance under the numerical route

Cabinet Resolution No. 3 of 2025 provides that a dominant position is established where the share of an undertaking, individually or jointly with other undertakings, exceeds 40% of total transactions in the relevant market.

The threshold therefore depends on the relevant market. A company may have a modest share of a broad industry but a dominant share of a narrower product, customer or geographic segment.

Correct market definition is therefore the first stage of a dominance analysis.

Dominance can also be established below 40%

The 40% rule is not the only route to dominance.

Article 6(2)(b) of the Competition Law separately allows dominance to be established where an undertaking has the ability to influence the market in a manner capable of causing harm, according to the controls in the Executive Regulation.

Cabinet Resolution No. 59 of 2026 now gives that alternative route practical content.

The Regulation expressly states that the significance of an undertaking's market share may be considered even where that share does not exceed the numerical dominance threshold.

Businesses should therefore avoid treating 39% as a statutory safe harbour.

The 2026 market-power analysis is broader than market share

Article 2 of the 2026 Executive Regulation identifies structural and economic indicators relevant to harmful influence in the market.

technological superiority;
the business model;
the significance of financial resources;
geographical concentration;
ability to impose commercial conditions;
ability to operate independently of competitors, customers or consumers;
the inability of competitors to constrain the undertaking effectively;
the significance of domestic sales and customer dependence;
financial and strategic market power;
presence in adjacent or multiple markets;
availability and substitutability of alternatives;
pricing behaviour compared with competitive benchmarks;
barriers to entry and exit; and
exclusive or long-term customer or supplier relationships.

The practical result is a more economic assessment of market power.

Innovation and technological success are not themselves abuses

The 2026 Executive Regulation contains an important qualification for technology-driven businesses. Technological superiority arising from innovation, investment, research or development does not, by itself, establish dominance.

The concern arises when that position is accompanied by the ability to influence the market in a way that harms competition, restricts entry or reduces consumer choice.

A highly successful technology platform should therefore distinguish between lawful innovation advantages and conduct that uses those advantages to foreclose competition.

Market definition can determine the entire case

Before asking whether a business is dominant, the relevant product or service market and relevant geographic market must be identified.

The Ministry's current competition materials include Guidelines on Relevant Market Definition, published in July 2026.

which products or services customers view as substitutes;
whether suppliers can switch production quickly;
whether a digital platform forms a distinct competitive environment;
whether a particular emirate or free zone has distinct competitive conditions;
whether customer groups face materially different competitive alternatives; and
whether quality, functionality or data access matter more than price in defining substitution.

An undertaking should not calculate its market share until it has developed a reasoned market definition.

Article 6 lists specific examples of abusive conduct

The Competition Law identifies a broad but non-exhaustive list of conduct that can constitute abuse when carried out by a dominant undertaking and used to distort or restrict competition.

imposing resale prices or resale conditions;
below-cost pricing aimed at excluding competitors or preventing entry;
unjustified discrimination between customers in comparable contracts;
obliging customers not to deal with competitors;
unjustified refusal to transact on normal commercial terms;
unjustified refusal, limitation or obstruction of purchases or sales leading to artificial prices;
tying unrelated supplementary obligations to a transaction;
intentionally publishing incorrect information concerning products or prices;
reducing or increasing supply to create artificial scarcity or abundance;
controlling or limiting production, markets or technological development; and
unjustifiably denying access to essential private networks, facilities or physical or digital infrastructure.

The central issue is competitive harm, not merely whether the conduct is commercially aggressive.

Dominant firms must review pricing from several different angles

Pricing risk under UAE competition law is broader than one prohibition. A dominant undertaking can face scrutiny for resale-price control, predatory below-cost pricing, unfair or artificial pricing resulting from restricted supply, discriminatory pricing and conduct that reduces consumer choice or imposes unfair prices through market power.

Resale-price control can create dominance risk

Article 6 expressly identifies direct or indirect imposition of resale prices or resale conditions as potentially abusive conduct by a dominant undertaking.

This can be relevant where a powerful manufacturer, platform, wholesaler or franchisor seeks to control how downstream businesses price goods or services.

genuine non-binding recommendations;
maximum resale prices designed to protect consumers;
fixed resale prices;
minimum resale prices;
penalties or incentives that effectively force a resale price; and
algorithmic or platform mechanisms that functionally control downstream pricing.

A contractual clause may be labelled “recommended pricing” but still create competition risk if commercial pressure makes departure unrealistic.

Predatory pricing now has specific cost benchmarks

Article 8 separately prohibits pricing to consumers at levels excessively below production, manufacturing and marketing costs where the goal or result is to remove an undertaking or product from the relevant market or prevent entry.

Article 3 of the 2026 Executive Regulation now provides detailed benchmarks.

Prices below average variable cost or marginal cost are treated as predatory unless the undertaking demonstrates a legitimate economic justification unrelated to excluding, restricting or preventing competition.

Prices above average variable cost or marginal cost but below average total cost may still be treated as predatory where clear evidence shows an anti-competitive plan or intent to eliminate a competitor, restrict its activities or prevent market entry.

Not every low price is unlawful

Competition law should not punish ordinary discounting that benefits consumers. The 2026 framework requires the authority to consider pricing on a case-by-case basis, including the market position of the business, prices of substitutes, relevant costs and the purpose or effect of the pricing.

Legitimate explanations can be important. Depending on the facts, discounted pricing may reflect promotions, seasonal sales, clearance of obsolete or perishable inventory, genuine efficiencies, introductory pricing or other objective commercial reasons.

The business should preserve evidence of that legitimate rationale before an investigation begins.

Recoupment and later price increases can be relevant

The Executive Regulation directs attention to whether the undertaking may later be able to increase prices after competitors have been excluded, disciplined or deterred.

Internal documents discussing elimination of competitors followed by later price increases can create substantially greater risk than records demonstrating a genuine temporary promotion supported by efficiency or inventory reasons.

Price discrimination is not automatically prohibited

Article 6 prohibits unjustified discrimination between customers in identical contracts concerning price, quality or terms of sale or purchase.

Different commercial terms can potentially have objective explanations, including order volume, distribution cost, credit risk, delivery location, contract duration, service level, marketing contribution, product specification or another measurable cost or risk difference.

The risk increases when equivalent customers receive materially different terms without a defensible explanation and the discrimination harms competition.

Customer segmentation should be documented

Dominant businesses frequently use tiered pricing, rebates and negotiated customer agreements. A competition-compliant system should be able to explain why similarly situated customers are treated differently.

published discount criteria;
volume thresholds;
service-cost analysis;
credit-rating criteria;
logistics costs;
promotional commitments;
contract term; and
objective performance criteria.

Individual sales teams should not be given unrestricted discretion to penalise customers for using competitors.

Refusal to deal is a specific statutory risk

Article 6 prohibits the total or partial refusal to enter a transaction on usual commercial terms without justification or objective reason.

It also prohibits unjustifiably refusing, limiting or obstructing the sale or purchase of goods or services where that conduct leads to artificial prices.

A dominant business therefore needs to distinguish lawful customer selection from exclusionary refusal to supply.

Objective reasons can matter in refusal-to-deal cases

A refusal is not automatically abusive merely because a customer or competitor wants access.

non-payment or serious credit risk;
capacity constraints;
product shortages not artificially created;
sanctions or legal restrictions;
safety or quality requirements;
failure to satisfy objective technical standards;
fraud risk;
material contractual breach; or
another legitimate commercial justification applied consistently.

A dominant undertaking should document the objective basis at the time of refusal rather than attempting to reconstruct a justification after a complaint is filed.

Essential networks and infrastructure receive special protection

Article 6 contains an important rule for infrastructure and digital markets. A dominant undertaking may not unjustifiably prevent or obstruct other undertakings from accessing private networks, facilities or physical or digital infrastructure that it owns or operates where that infrastructure is the only, basic and economically feasible solution for carrying out the economic activity or entering the relevant market.

logistics networks;
ports or specialised facilities;
digital platforms;
data or technical interfaces;
distribution infrastructure;
specialised networks;
marketplaces; or
other bottleneck assets.

The rule does not create an unlimited right of access to every private asset. The importance and economic feasibility of alternative access routes remain central.

Exclusive dealing can become abusive

Article 6 lists obliging a customer not to deal with a competing undertaking as potentially abusive.

The analysis should consider market coverage, duration, switching ability, alternative distribution routes, minimum purchase obligations, loyalty rebates, termination rights, legitimate investment reasons and whether competitors can access enough customers to remain viable.

The Ministry's current legislation portal also lists Ministerial Decision No. 32 of 2026, providing a specific block exemption for certain exclusive dealing agreements in the market for food promotion and delivery services through digital platforms. That illustrates an important point: an exemption can be narrow, sector-specific and conditional rather than a general approval of exclusivity.

Tying and bundling require a connection to the original transaction

Article 6 prohibits making the sale, purchase or service contract conditional on acceptance of supplementary obligations concerning other goods or services that have no connection with the original transaction by nature or commercial usage.

A dominant supplier should review whether the customer genuinely needs to purchase the second product or service or whether the condition is being used to leverage power from one market into another.

Bundled discounts require separate analysis because a genuine combined offer can produce efficiencies while still creating foreclosure risk where competitors cannot match the bundle.

Manipulating supply to create artificial prices is prohibited

Article 6 identifies reducing or increasing available supply to create artificial scarcity or abundance as potential abuse.

This can be relevant where a powerful supplier intentionally withholds stock, limits output or releases abnormal quantities for the purpose of manipulating market conditions.

Normal capacity planning, seasonal inventory management and production interruptions are different from deliberate supply manipulation. The business should be able to demonstrate the operational reason for material supply changes.

Limiting technology or market development can be abusive

The statute also prohibits controlling or limiting production, markets or technological development where used abusively by a dominant undertaking.

For technology and platform businesses, this can make contractual restrictions on interoperability, APIs, software access, hardware compatibility, data portability or technical integration relevant to competition review.

Intellectual property rights remain protected, but their exercise does not automatically sit outside competition law where the conduct affects competition in the UAE.

Abuse of economic dependence is a separate offence

Article 7 introduces a concept that should not be confused with dominance. An undertaking may abuse a customer's economic dependence where that customer has no alternative solutions for marketing or supply.

imposing resale prices or conditions;
unjustified discrimination;
forcing the customer not to deal with competitors;
unjustified refusal to transact;
restricting sales or purchases in a way that creates artificial prices;
tying unrelated obligations; and
controlling or limiting production, markets or technological development.

Economic dependence can therefore create competition risk even where the supplier's overall market share is not enough to establish conventional dominance.

Dominance can be individual or collective

The Competition Law refers to an undertaking acting individually or in collaboration with other undertakings. A market can therefore require analysis of whether several undertakings together occupy a position capable of materially influencing competitive conditions.

Parallel commercial behaviour alone does not automatically establish collective dominance, but market structure, relationships and the ability to act in a coordinated manner can be relevant.

Foreign conduct can fall within the UAE regime

Article 3 applies the Competition Law to economic activity conducted outside the UAE where that activity affects competition inside the UAE.

A foreign platform, manufacturer or supplier with substantial UAE market power can therefore face UAE competition analysis even where the relevant contracting entity is located abroad.

Sector-specific competition jurisdiction must be checked

Article 4 excludes conduct involving goods or services where another law gives a sectoral regulatory authority responsibility for competition rules and economic concentrations, unless the sector regulator and Ministry agree that the Ministry will take over the matter.

Government-owned undertakings may also be subject to specified exclusions under the statutory mechanism.

Exemptions may be available, but they are not automatic

Article 9 allows certain agreements or practices to qualify for exemption where the undertakings demonstrate that they are necessary to promote economic development, improve performance and competitiveness, develop production or distribution or provide benefits to consumers.

The arrangement must not impose restrictions beyond what is necessary and must not completely eliminate competition in the relevant market or a substantial part of it.

The 2026 Executive Regulation now provides the procedural framework for exemption applications. Businesses considering conduct that could engage Articles 6, 7 or 8 should not assume that an efficiency argument automatically legalises the practice.

Block exemptions can apply to defined categories

Article 11 permits categories of contracts and related activities to be exempted where they support economic development, competitiveness, production or consumer benefit.

The current Ministry competition-legislation portal lists the first 2026 sector-specific block-exemption decisions, including the decision concerning exclusive dealing in food promotion and delivery services through digital platforms.

A block exemption should be read narrowly against its scope, conditions and duration.

Competition complaints can be filed with the Ministry

The Ministry of Economy and Tourism maintains dedicated channels for competition complaints. Its current complaint page states that businesses and interested parties may submit a complaint identifying the complainant, the party complained against, the provisions allegedly violated, the relevant facts, the conduct complained of and supporting documents and evidence.

The Competition and Consumer Protection Department reviews the complaint, communicates with the parties and takes the necessary measures under the competition framework.

The authorities can investigate even without a private complaint

Article 26 of the 2026 Executive Regulation expressly permits the Ministry, relevant local authority or sectoral regulator to initiate an investigation on its own motion where evidence gives reasonable grounds and sufficient information indicating conduct that may prejudice, restrict or impede fair competition.

The authorities may also conduct periodic market monitoring and require undertakings to provide data, documents and information.

Complaint withdrawal does not necessarily end regulatory risk

Once the competition authority has evidence suggesting a broader market violation, the dispute is no longer purely private. A commercial settlement may resolve contractual issues but does not necessarily require the authority to stop investigating conduct affecting market competition.

Internal documents can become central evidence

Dominance cases often depend on commercial strategy rather than the wording of one contract.

pricing committee papers;
discount approvals;
emails discussing competitor exclusion;
customer segmentation policies;
instructions to sales teams;
platform access rules;
capacity-allocation decisions;
market-share studies;
strategy presentations; and
documents discussing barriers to competitor entry.

Competition compliance should therefore be reflected in real decision-making processes rather than only in external contract templates.

Article 24 creates significant financial exposure

A violation of Article 6 on abuse of dominant position falls within Article 24 of the Competition Law.

The penalty is a fine of at least AED 100,000 and up to 10% of the annual total sales realised by the violating undertaking in the UAE during the last completed fiscal year.

If those annual UAE sales cannot be calculated, the fine ranges from AED 500,000 to AED 5 million.

The same penalty framework also covers the restrictive-agreement, economic-dependence and predatory-pricing provisions identified in Article 24.

The court can order closure and publication of the judgment

Article 29 allows the court, upon conviction, to order closure of the undertaking for a period of not less than three months and not more than six months.

The court may also order publication of the operative part of the judgment in at least two local daily newspapers at the violator's expense.

Competition cases are treated as urgent

Article 31 provides that competition cases have urgent status and permits the competent court to suspend or prohibit conduct pending final judgment.

This can be particularly important in refusal-to-supply, access and exclusionary-conduct cases where damages alone may not preserve the competitor's position in the market.

Complaints generally have a five-year limitation period

Article 37 provides a five-year prescriptive period for complaints concerning anti-competitive practices from the date of the conduct.

The law creates an exception for practices proven to continue and whose harmful competitive effects continue for more than five years.

A practical dominance-risk matrix

Conduct	Core compliance question
Low prices	Are prices below relevant cost benchmarks, and is there an exclusionary purpose or effect?
Different customer prices	Are comparable customers being treated differently without objective justification?
Refusal to supply	Is there a legitimate objective reason for refusing normal commercial terms?
Exclusive dealing	Does exclusivity foreclose competitors from a significant share of customers or supply?
Tying	Is the customer forced to accept an unrelated product or service?
Supply reduction	Is output being restricted to create artificial scarcity or prices?
Infrastructure access	Is a competitor being denied access to an essential, economically feasible bottleneck facility?
Digital platform rules	Do ranking, access, pricing or data rules use platform power to disadvantage rivals unfairly?
Technology restrictions	Do technical limitations unnecessarily prevent entry, interoperability or innovation?
Customer dependence	Does the customer lack realistic alternative routes for supply or marketing?

Practical checklist for businesses with strong market positions

Define the relevant market. Do not rely only on general industry labels.
Calculate market share regularly. Include the current 40% benchmark but do not treat sub-40% shares as an absolute safe harbour.
Assess broader market power. Review substitutes, barriers, customer dependence, financial strength and adjacent-market presence.
Audit pricing. Identify resale controls, discriminatory discounts and below-cost strategies.
Document legitimate low-price reasons. Promotions, inventory clearance and efficiencies should be recorded contemporaneously.
Review refusals to deal. Use objective and consistently applied criteria.
Control exclusivity. Analyse coverage, duration and the availability of alternative routes for competitors.
Review tying and bundling. Confirm the commercial connection and competitive effect.
Identify bottleneck infrastructure. Networks, platforms and facilities can create heightened access risk.
Document customer segmentation. Different terms should have defensible cost, risk or service reasons.
Train sales and procurement teams. Competition risk often arises in day-to-day negotiations.
Review internal strategy language. Avoid commercial policies built around exclusion rather than competition on the merits.
Check exemption routes before implementation. Do not assume efficiency arguments can be raised only after a complaint.
Prepare for investigation. Maintain clear records explaining pricing, supply and access decisions.

Key takeaway

UAE abuse-of-dominance law is now materially more detailed than it was before 2026. Federal Decree-Law No. 36 of 2023 prohibits dominant undertakings from using their position to distort, restrict, lessen or prevent competition, while Cabinet Resolution No. 3 of 2025 establishes a 40% market-share route to dominance.

The 2026 Executive Regulation adds a second and more nuanced inquiry into actual market power. Businesses can be assessed through financial strength, pricing power, technological position, barriers to entry, customer dependence, substitutes, adjacent-market presence and long-term exclusive relationships. A market share below 40% therefore does not automatically end the analysis.

Pricing, refusal to deal and discrimination are central areas of risk. Predatory pricing now has express cost benchmarks, discriminatory treatment requires objective justification, refusals to transact should be supported by legitimate reasons, and dominant businesses controlling essential networks or infrastructure face specific access obligations.

The regime also distinguishes abuse of dominance from abuse of economic dependence, meaning a business can face competition risk where a customer lacks realistic alternatives even without conventional market dominance.

Enforcement risk is significant: Article 24 permits fines reaching 10% of annual UAE sales, while courts can order temporary closure and publication of judgments. The Ministry may also investigate on its own initiative and does not depend solely on private complaints.

HZ Legal can assist dominant businesses, distributors, technology platforms, infrastructure operators, suppliers, customers and investors with UAE dominance assessments, relevant-market analysis, pricing reviews, refusal-to-deal and access policies, discrimination and rebate structures, exclusivity, economic-dependence issues, exemption applications, competition complaints, investigations and enforcement defence.

Official and authoritative sources

This article provides general legal and regulatory information only and does not constitute case-specific competition, pricing, commercial or litigation advice. Dominance analysis depends on the relevant market, market share, substitutes, barriers to entry, customer dependence, pricing conduct, objective commercial justifications and sector-specific regulation. Businesses with material market power should assess significant changes to pricing, distribution, access, exclusivity and supply policies before implementation.