European Community Competition Procedure

By Luis Ortiz Blanco | Go to book overview

Introduction

Following the entry into force of the Treaty of Rome which established the European Economic Community (the EEC, now the EC Treaty), Community competition law must be observed by companies and firms in the European Union in the same way as national law. It is to be regarded as domestic law for all purposes. With the creation of the European Communities, numerous undertakings have experienced the application of Community competition law for themselves. This has sometimes been in their favour -- where the European Commission has protected them against abuses of dominant positions or restrictive agreements of any kind; and this has sometimes been against them -- where they have been subjected to investigations or fined by the Commission for engaging in such abuses or participating in such agreements.

Competition policy is one of the cornerstones of the European Community. It is one of the principal means of achieving the objectives set out in Article 2 of the EC Treaty. Article 3(g) of the Treaty provides that, in pursuance of those purposes, the activities of the Community are to include 'the institution of a system ensuring that competition in the Common Market is not distorted'.

Competition policy has been developed in such a manner as to avoid excessive interference with the day-to-day management and commercial strategy of undertakings. It has been and continues to be based on the assumption that undertakings produce desired economic welfare and contribute to the development of new technologies. At the same time, competition policy lays down the basic rules by which freedom of competition, an essential feature of any market economy, is to be regulated. Just as a sport without rules is inconceivable, so there can be no free market economy without legislative provisions governing competition.

The European Commission has so far been the institution primarily responsible for ensuring compliance with Community competition rules. Although Brussels may appear remote, the Commission is responsible for applying competition law from Lisbon to Athens and from Rome to Helsinki, regardless of the location of the undertakings involved. At any given time the Commission is simultaneously dealing with several hundred cases concerning the conduct of European undertakings in all the Member States of the Union.

In general, undertakings prefer not to become involved in procedures for the application of competition law, a preference which is perfectly understandable. Few areas of law have such a direct impact on the strategies applied by undertakings as competition law. Undertakings may be forced by the competition rules to make radical changes in their conduct within the Community market. Moreover, it is not unusual for Commission procedures to last for more than a year, during which period the undertakings involved have to provide a plethora of information about their business. Sometimes undertakings' offices are visited

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