Toespraak Kroes voor het Internationale Concurrentienetwerk (ICN) (en)

SPEECH/07/345

Neelie Kroes

European Commissioner for Competition Policy

The International Competition Network - Achievements and Goals

International Competition Network (ICN) Annual Conference

Moscow, 30th May 2007

We are here to share the Sixth Annual Conference of the International Competition Network. Just looking around the audience here proves that we live in an increasingly joined-up world. The global market place is a reality. Right around the world, more competition is driving more economic growth. Never have there been more opportunities open to businesses of all sizes and all backgrounds to spread their wings and fly.

That of course brings both benefits and challenges. But international competition is no zero sum game. The benefits of competitiveness, growth and lasting social and environmental development are mutually reinforcing. A properly-managed environment for business sustains and promotes competitiveness, productivity and growth, at global, regional and national levels. Delivering this environment is the common challenge all competition authorities face.

Yet the increasing integration of the world economy is reflected by the rise in multi-jurisdictional mergers and anti-competitive conduct across borders. These trends mean international cooperation is vitally important for modern competition authorities. If we want to play our full part as promoters of sustainable growth in our national, regional and global markets, we, the competition authorities, need to do more to coordinate our actions and policies.

Active bilateral co-operation between competition authorities is of unquestionable value. It promotes effective joint responses to anti-competitive practices, amongst other things by avoiding conflicting conclusions in cross-border cases. At this point I would like to reiterate the European Commission's commitment to maintaining the close co-operation with the Federal Anti-Monopoly Service that has been established in recent years.

But with the growing number of competition authorities world-wide, bilateral cooperation is clearly not enough. A global market requires a multilateral response. That is why the ICN is so crucial. The ICN gives us the opportunity to learn from each others' experiences, successes and failures. Competition authorities are growing around the world, developing new ways of thinking and doing things. In a rapidly changing world, we all need to stay very much on our toes.

Here in Russia, competition policy has developed and matured quickly since the first competition law fifteen years ago. The revisions carried out in October last year give Russian competition policy the means to be really effective in the modern world. I particularly welcome the inclusion of provisions on state aid in the new competition law. In the European Single Market we have made a point of including state aid control as an integral part of effective competition policy. It is not just private actors who can distort competition. The actions of public bodies - for example through granting subsidies and other kinds of assistance to companies - can also act as an obstacle to a level playing field. A fair environment for competition is better for everyone than a costly and damaging subsidy race in which there are bound to be losers as well as winners. So I can only applaud the approach that has been taken here in Russia, and encourage others to think in the same way.

I'm also very interested to see that there is currently a bill before the Duma proposing increased fines for competition infringements. All competition authorities need to closely and constantly keep an eye on the deterrent effect of their sanctions. In the European Union we recently reviewed our own fines policy, and found it needed updating. Our new rules keep the maximum level of fines at 10% of worldwide turnover, but we have adapted our method of calculating fines in cartel cases to maintain the effectiveness of our sanctions system, for example, by doubling the fines in the case of repeat offenders.

Authorities also have a responsibility to make sure their policies stay up to date with market developments. This is particularly true in strategic sectors such as energy. In the EU we have reviewed both the gas and electricity sectors under our competition rules and we have widely published our findings. In its follow-up to that review, the European Council has made it clear that we must introduce more competition into these sectors. We have to keep our models of control up to date so they support growth-oriented market based structures, both at the production and supply side, as well as at the transmission and distribution side We are committed to undertake our part of the work and expect the same from our partners. We have to make sure in our jurisdictions that players - wherever they come from and whatever their size - play by the rules.

If competition authorities are to remain effective in an ever-changing world, we all have to keep our policy and tools under continuous monitoring and review. There is no exception to that. And sharing experiences between ourselves can help us all design ever-better systems.

That is where the ICN really comes to the fore. The Network was set up in the year 2000 to promote a competition culture in a joint effort, through better competition enforcement and better competition advocacy.

Has the ICN lived up to these ambitions? Let me give you my personal view. Mozart had already composed his first Andantes and Allegros by the age of six. The ICN is also a bit of a precocious child! Not only does it have a number of Guiding Principles and Recommended Practices under its belt, but also numerous reports, manuals and workshops. In particular, its two annual workshops, on cartels and mergers, are a valuable source of information and training for all ICN members. And I hope that in the future, these will be complemented by an annual ICN unilateral conduct workshop.

The last year has been a good one for the ICN. In addition to the cartel and merger workshops, we have a number of written proposals presented to the conference for approval by the various working groups. On unilateral conduct, we have reports on the objectives of laws regarding unilateral conduct, and on the concept and definition of dominance/substantial market power. On cartels, there is a new draft chapter for the anti-cartel enforcement manual (on case selection and prioritisation) and supplementary reports on co-operation between authorities and on private enforcement. On mergers, we have a paper on the definition of merger transactions. From the CPI working group there are findings on technical assistance for newer competition authorities and a report on competition and the judiciary.

This is all great work. The European Commission takes the ICN's work seriously, and we gain a lot from it. Let me give you some examples. Firstly, when we adopted a revised Merger Regulation a few years ago, we made specific changes to our legislation regarding the timing of notifications, ensuring that our procedures were fully in line with the ICN's Merger Recommended Practices. Secondly, we are currently reviewing our policy in the area of abuse of dominance. The unilateral conduct working group discussions are a key opportunity for us to gather useful input on this. Thirdly, we think the fight against cartels is a top priority, so we are delighted to have the chance to contribute as co-chair of the ICN's cartels working group. Finally, we are also looking at ways to facilitate more private actions for damages against companies that have infringed competition rules - an area where the cartels working group is pursing very stimulating discussions.

So I'm convinced that the ICN is already a great success story. Now I'd like to look forward, and consider how we can build on this. I'd like to highlight three key priorities.

Most importantly, we need more members, and in particular younger members, to become active in the ICN's work. I know everyone has resource issues, especially in the early days. But I would like to make it clear how much we would value the contribution of younger members, not least so that together we can ensure that the ICN's output is more useful to more authorities.

Secondly, the ICN should be more upfront in discussing variations in policy between jurisdictions. Substantive issues such as unilateral conduct and substantive merger assessment deserve to considered in a spirit of mutual respect and constructive debate. Let's not shy away from them.

And thirdly, implementation and outreach should become keywords for the ICN. By outreach, I mean the ICN making its work known and influential outside the circle of competition authorities, law firms and academics. By implementation, I mean the increased use and application of ICN work by members and their jurisdictions. In the implementation panel in this conference we will hear some examples of the use of ICN work, but more systematic work on implementation needs to be done.

Honourable friends, Ladies and Gentlemen,

The ICN is all about better competition enforcement and better competition advocacy. We have two means to reach these shared goals: co-operation between competition authorities, and convergence in our practices. I have no doubt sure that this week's proceedings here in Moscow will contribute to both, and also perhaps give us a chance to think about how we can take cooperation in the ICN even further in the coming years.