European Commission consults stakeholders on a possible new competition tool

Alongside the consultation on the Digital Services Act (see item above), the European Commission has published an inception impact assessment as well as an open public consultation inviting comments on exploring the need for a possible new competition tool that would address “structural competition problems in a timely and effective manner”.

The Commission says that it has been reflecting on the role of competition policy and how it fits in a digital, globalised world that “must become greener”. This reflection process is part of a broader policy debate about the need for changes to the current competition law framework to which different stakeholders have contributed with reports and studies, making proposals on how to adapt or extend the competition law toolbox.

Against this background, the Commission has concluded that ensuring the contestability and fair functioning of markets across the economy is likely to require a “holistic and comprehensive approach”, with an emphasis on the following three pillars:

  1. the continued vigorous enforcement of existing competition rules making full use of Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU), including the use of interim measures and restorative remedies, where appropriate;
  2. possible ex-ante regulation of digital platforms, including additional requirements for those that play a gatekeeper role; and
  • a possible new competition tool to deal with structural competition problems across markets that cannot be tackled or addressed effectively under current competition rules (e.g. preventing markets from tipping).

The impact assessment on platform-specific ex ante regulation covers the second pillar, while the consultation deals with the third pillar.

The Commission says that its experience with enforcing EU competition rules in digital and other markets, as well as the reflection process on the fitness of existing competition rules that it has undergone, have helped it identify certain “structural competition problems” that the current rules cannot deal with in the most effective manner.

The new competition tool should “enable the Commission to address gaps in the current competition rules and to intervene against structural competition problems across markets in a timely and effective manner”. It should also allow the Commission to “impose behavioural and where appropriate, structural remedies”. However, the Commission says, “there would be no finding of an infringement, nor would any fines be imposed on the market participants”.

The Commission is consulting stakeholders from the public and private sector, including competition authorities and government bodies, academia, as well as legal and economic practitioners. Respondents are invited to submit their views on the inception impact assessment by 30 June 2020 and to respond to the open public consultation by 8 September 2020 in any official EU language. Subject to the outcome of the impact assessment, a legislative proposal is scheduled for Q4/2020. To read the Commission’s press release in full and for links to the relevant documents, click here.