35 Competition policy
| (26687)
10363/05
SEC(05) 805
| Commission Report on Competition Policy 2004
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| Legal base | — |
| Document originated | 17 June 2005
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| Deposited in Parliament | 05 July 2005
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| Department | Trade and Industry
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| Basis of consideration | EM of 15 July 2005
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| Previous Committee Report | None
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| To be discussed in Council | None planned
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
35.1 The purpose of the EUs competition rules is to prevent the
restriction or distortion of competition in the Single Market
through restrictive practices or the abuse of a dominant position,
although certain restrictive agreements considered by the Commission
to have a beneficial effect are permitted under procedures for
individual or block exemptions. The Commission has particularly
formidable powers, both legislative and executive, in this area
and the Commission reports annually on competition policy.
The document
35.2 The introduction to the Commission's 34th report
sets 2004 in the context of significant change: enlargement to
25 Member States, modernisation of the competition rules, a new
Commission and reorganisation, as a consequence of modernisation,
of the Competition Directorate-General. It discusses
- the interaction of competition with other Community policies:
promotion of a knowledge-based economy, fostering the internal
market and promotion of a favourable business climate; and
- general competition policy objectives: enforcement
priorities focussed on the most harmful anti-competitive practices,
enhancing competitiveness through the regulatory framework, focussing
action on key sectors for the internal market and the Lisbon Strategy
and use of independent Hearings Officers.
35.3 The body of the report covers:
- anti-trust: modernisation of
the legislative and interpretative rules, activity on abuse of
dominant positions, cartels, other agreements and concerted practices,
policy developments in several sectors (mobile and broadband internet
services, rights management for music, sports rights on 3G networks
and motor vehicle distribution), state measures (in relation to
public undertakings and undertakings with exclusive or special
rights), activity of the European Competition Network of national
competition authorities, particularly in relation to transport,
energy and financial services;
- merger control, including the new legislative
and interpretative rules and noting a marked increase in the number
of notified mergers and acquisitions compared with 2003;
- developments in several sectors: energy, electronic
communications, transport, financial services and the liberal
professions;
- state aid control, including the new legislative
and interpretative rules and sectoral developments in relation
to shipbuilding, agriculture, fisheries, coal, transport and public
services and services of general (economic) interest;
- international activities: enlargement and the
Western Balkans, the near neighbours, bilateral cooperation (including
agreements with the USA, Canada and Japan) and multilateral cooperation
through the International Competition Network of national competition
authorities and the OECD;
- the Commission's intentions for 2005 in relation
to anti-trust, mergers and state aid activities and to international
co-ordination.
The various sections of the report are illustrated
both with statistics and discussion of a wide range of cases.
The Government's view
35.4 The Parliamentary Under-Secretary of State for
Employment Relations and Consumer Affairs, Department of Trade
and Industry (Mr Gerry Sutcliffe) comments on a number of matters
covered in the report. On anti-trust matters he notes the Government's
previous support for the general overhaul of the legislative and
interpretative rules and its support, as Presidency, for review
and revision of sector specific rules such as the block exemptions
for liner shipping and air transport. On mergers the Minister
says the Government has welcomed the new legislative and interpretative
rules. In relation to state aid, whilst noting the Commission's
exclusive competence in this area, he says the Government has
supported Commission attempts to modernise state aid rules and
notes that some important rules and guidelines, including in relation
to regional aid, are under review at the moment.[103]
Conclusion
35.5 Competition policy is a complex but highly
important matter. This document, which we clear, gives a useful
summary both of ongoing activity and of significant developments
in 2004.
103 See (25751) 0432/04: HC 42-xxix (2003-04), para
4 (21 July 2004) and (26643) 10083/05 + ADD1: HC 34-ii (2005-06),
para 4 (13 July 2005). Back
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