Toespraak eurocommissaris Almunia (mededinging) over rol mededingingsautoriteiten (en)

Joaquín Almunia

Vice President of the European Commission responsible for Competition Policy

A new decade for the International Competition Network

10th Annual Conference of the International Competition Network

The Hague, 18 May 2011

Ladies and Gentlemen,

It is a great pleasure for me to be here with you for this 10th Annual Conference, and I would like to thank the Dutch Competition Authority for its kind invitation.

We've come a long way since the first ICN conference in Naples in 2002. The ICN started as a network of 15 competition agencies that shared a vision for spreading competition culture beyond their borders and for building convergence in competition law. We are now 117 around the table and this is a great success.

As we are about to enter into the ICN's second decade, there are many challenges ahead of us. We will of course have to continue the rigorous enforcement of competition rules, but competition authorities will also have to intervene more proactively in the discussion on how markets should work.

There is one lesson we all learned during the crisis and that will serve us well for the coming decade: Competition Authorities should be in the driving seat when it comes to promoting openness, dynamism and resilience in our market economies.

With these objectives in mind, competition authorities, with the support of the ICN, should lead the efforts to resist protectionism. We must continue to actively enforce competition rules, in order to contribute to recovery and growth. And we should seek to achieve the right balance between competition and regulation, including through our involvement in legislative processes.

As competition authorities we are in a unique position to feed the debate about the value of well-functioning markets, and we must promote principles that ensure a fair, efficient and stable environment for them.

A few words on fighting protectionism. Back at the first ICN Conference, Commissioner Monti said that "as competition policy regulators, we are well placed to point to some of the failings of our respective jurisdictions' trade and economic liberalisation policies".

He went on to say that "advocating the right kinds of reform in other policy areas can only make what we are launching here in Naples all the more effective".

These words remain true today.

Competition enforcers and the ICN must remain firm on this openness principle. We must reiterate whenever possible that open trade and open foreign direct investments are key factors in economic recovery.

To take the example of the EU, net exports were responsible for a third of GDP growth in 2010.

The EU is also the largest exporter of foreign direct investment and a major beneficiary of foreign direct investment inflows.

Investments and trade drive our economies forward. I firmly believe that if the EU were to play a protectionist card in this game, it would lose; and the same is true for the global economy.

Unfortunately, the crisis has increased protectionist temptations in different parts of the world, and competition authorities must resist these moves.

There are two ways to react to such mounting pressures: either push for opening markets abroad or close home markets.

The ICN and competition authorities should naturally promote the first option: open and competitive markets. We must therefore call for reciprocity in opening markets, not in closing them.

It is in the interest of all our economies that companies get access to services and investment, that public procurement markets are open and that intellectual property rights are adequately enforced.

Competition authorities also have a role to play in explaining why it is essential to keep competition enforcement separate from other policy considerations.

Take merger control. The EU Merger Regulation was drafted in such a way as to distinguish between competition considerations and other public interests. This allows EU merger control to rely exclusively on an objective economic analysis, focusing on the effects of the merger on the market.

Keeping our enforcement work clear of other considerations allows us to focus on the core of our mission.

Active competition enforcement was essential during the crisis and it will remain so to boost recovery.

We have already done outstanding work in our fight against cartels, an area of extensive convergence and collaboration in the ICN as showcased in the Air Cargo cartel for example, where we organized coordinated inspections across several jurisdictions. As we all well know it, "crisis cartels" must be prevented if we want efficient and competitive firms in the future.

We have also built convergence in the area of mergers - and cooperation among ICN members has become embedded in our daily work routine.

Here again, effective merger control is instrumental in ensuring well-functioning markets. Mergers that lead to quasi-monopolies or excessive market power will never be a solution to problems generated by the crisis. They simply give rise to higher prices and stifle innovation.

But competition policy goes beyond that; in particular during the last years we have been fully aware of the importance of the way public resources are used to support some economic activities.

In Europe, our system of State aid control allows us to distinguish between aid that is distortive and aid that can be useful to the economy, such as public support for research or innovation.

Distortive aid by governments can be just as harmful to the market as anticompetitive behaviour by companies. It keeps inefficient companies alive, it distorts the level playing field, and it creates subsidy races that are ultimately harmful to all.

This is why the time may be right to reflect together on a more effective multilateral framework on tackling harmful aid.

Ladies and Gentlemen,

As competition enforcers we have a privileged position, because we can look in tremendous detail at how markets work and develop.

We should use our unique position to feed the debate about the value of well-functioning markets and, when necessary, how they should be regulated.

I would mention just two examples where this is particularly important.

First, given the pace of technological change in the digital arena, we are all faced with challenging issues on "new markets".

High growth, dynamic competition and innovation often make it difficult to predict the very near future. Still, effective competition policy is essential.

Taking the long view on these markets shows us that incumbency generates advantages that then survive through generations of product development.

We thus need to work on sound competition principles from the outset to ensure that such markets remain open in the longer term, by identifying early enough harmful behaviour and preserving competitive market structures.

Second, the economic crisis highlighted serious structural weaknesses in financial services markets.

In the years to come our countries will have to tackle the regulatory gaps that originated or facilitated the crisis. And I believe that competition authorities should become more involved in the design of a modern and effective regulatory framework.

Many members of the ICN have powers to give opinions to their governments and legislators or to intervene directly in the legislative process.

Let's use these powers in our respective jurisdictions and leverage each other's efforts.

Regulation should lay down the principles of efficient and stable markets; and our competition expertise can certainly help devise a regulatory framework that prevents anticompetitive behaviour from arising.

Ladies and Gentlemen,

The ICN is a success story and our inclusive strategy should encourage other major jurisdictions to join us soon.

I am sure that we will continue to make progress in the coming years especially in those areas where some differences persist, such as unilateral conduct. Taking stock of differences is a first step, but our goal should be more ambitious since the lack of convergence can be costly for regulators and businesses.

This is why we must continue to look for common principles, a view shared by most ICN members in the Second Decade Project.

The years to come should also allow the ICN to develop a broader public role in prompting regulators worldwide to adopt pro-competitive solutions and to resist protectionist moves.

One of the questions asked in the ICN Second Decade Exercise was "do you think you can tell a good story for consumers and governments about the benefits of the ICN, and what might that story be?"

I hope that we will tell that story together, by showing that through its work the ICN has contributed to maintaining competitive markets, where innovative businesses compete on the merits and where consumers reap the benefits of renewed prosperity.

Thank you.