| Antitrust (Competition) |
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"As Competition Commissioner, I'm here to ensure that competition policy delivers for consumers and for businesses. To that end I will focus on fighting against cartels, preventing dominant companies from abusing their market power in any sector or any country in Europe, and maintaining a rigorous scrutiny of proposed mergers. I also intend to consider further how to achieve effective compensation for victims of illegal antitrust behavior."
– Joaquín Almunia EU antitrust (competition) policy is essential for the functioning of the EU's Internal (or Single) Market with its free movement of goods, services, people and capital. The philosophy underpinning the Single Market is to allow firms to compete on a level playing field throughout all of the EU Member States, and competition policy sets out to encourage economic efficiency by creating a climate favorable to innovation and technical progress. How does the EU regulate competition? The European Union's antitrust policy, much like its US counterpart, ensures that healthy competition is not hindered by anticompetitive practices by companies. In addition, the European Commission has jurisdiction over large-scale mergers and acquisitions affecting more than one EU Member State and exceeding certain thresholds. The Commission can fine antitrust violators. Like the US government, it is entitled to review mergers between non-EU companies with certain revenue thresholds that conduct significant business in the EU. Moreover, unlike US antitrust law, EU law also ensures that competition is not hindered by the intervention of national authorities. In that respect, EU law prohibits state aid granted by EU members that distorts competition in the Internal Market. EU-US Cooperation The EU cooperates with US competition authorities - the Department of Justice and the Federal Trade Commission - primarily on the basis of the 1991 Cooperation Agreement and the 1998 "Positive Comity Agreement." Cooperation is intensified if the parties to a case have granted a waiver allowing the exchange of otherwise protected information. 1991 EU-US Competition Cooperation Agreement In 1991, the EU concluded an agreement with the United States of America regarding the application of their competition laws, with the aim of promoting cooperation between the competition authorities. The 1991 Agreement provides for:
The Cooperation Agreement provides for regular bilateral meetings to share information on current enforcement activities and priorities; on economic sectors of common interest, to discuss policy changes, and to discuss other matters of mutual interest relating to the application of competition laws. 1998 EU-US Positive Comity Agreement The EU-US Positive Comity Agreement was signed in Washington and entered into force on June 4, 1998. Under the rules of positive comity, one party may request the other party to remedy anti-competitive behavior which originates in its jurisdiction but affects the requesting party as well. The agreement clarifies both the mechanics of the positive comity cooperation instrument and the circumstances in which it can be availed of. Positive comity provisions are not frequently used as companies (i.e. complainants) prefer to address directly the competition authority they consider to be best suited to deal with the situation. Administrative Arrangement on Attendance (AAA) The AAA sets forth administrative arrangements between the competition authorities of the EU and the US concerning reciprocal attendance at certain stages of the procedures in individual cases, involving the application of their respective competition rules. These arrangements were concluded in the framework of the agreements between the EU and the US concerning enforcement of their competition rules, and in particular the provisions regarding coordination of enforcement activities. The AAA is not a new agreement but an understanding about administrative arrangements to apply the 1991 Agreement. Best practices on EU-US cooperation in merger cases In 2002, a set of best practices on cooperation in reviewing mergers that require approval on both sides of the Atlantic was agreed upon between the EU and the US antitrust authorities. These best practices are not legally binding but simply intend to set forth an advisory framework for interagency cooperation. They put in place a structured basis for cooperation in reviews of individual merger cases. The best practices recognize that cooperation is most effective when the investigation timetables of the reviewing agencies run more or less in parallel. Merging companies will therefore be offered the possibility of meeting at an early stage with the agencies to discuss timing issues. Companies are also encouraged to permit the agencies to exchange information which they have submitted during the course of an investigation and, where appropriate, to allow joint EU-US interviews of the companies concerned. The practices designate key points in the respective EU and US merger investigations when it may be appropriate for direct contacts to occur between senior officials on both sides. European Union Delegation, Washington, DC, Staff USEFUL Links: European Commission Websites
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| Last Updated ( Thursday, 24 June 2010 ) |