Clarification, having checked after being down-voted. It is also illegal if the below-cost pricing strategy can be shown to have been implemented with the express purpose of driving competitors out of business. This intent is the important thing, it would be fine to sell below cost to gain customers for a new market, or to encourage network effects, and if that had the unintended side effect of causing a competing company to fail this is fine.

My understanding is that these cases are usually very hard to prove, unless you have 'smoking gun' evidence of some kind.