Competition Law and Industrial Policy in the EU

Competition Law and Industrial Policy in the EU

Competition Law and Industrial Policy in the EU

Competition Law and Industrial Policy in the EU

Synopsis

This book provides a new analytical framework for legal problems concerning the economic order of the European Union. In order to determine the remaining scope for national economic sovereignty, and the improvement of the economic order of the Community itself, the focus of the book is the contentious relationship between competition and industrial policy under European law. The theoretical perspective used is based on a comparison between the concepts of the Treaty as an economic constitution and as a political constitution. On this basis, the convergence of competition and industrial policy at the Community level is explained as the result of the rationalisation of public policy, and the reduction of the economic independence of the member states. The study concludes that the market orientation of the European Union is not in doubt, but that a clear link remains to be established between the legitimacy of public intervention in the economy and the distribution of power in the Community system.

Excerpt

Worldwide, economic competition is in ascendance. in the European Community, as elsewhere, this is accompanied by retreat of the state from direct intervention in the economy. After decades of acting as participants in the economic process, the Member States are now divesting state holdings, and in many areas are proceeding to market regulation at arm's length. National competition policies are increasing their independence from the political process, in tandem with strict enforcement by the Community of the state aid and competition rules of the ec Treaty against the Member States themselves.

Yet at the same time, new theories on how competitiveness of nations may be actively promoted by public authorities have gained ground. Such theoretical prescriptions have affected practice at Community level: in the last few years, the European Community has adopted a common concept of industrial policy, aimed at the promotion of structural adjustment, and has received a formal competence on 'industry' under the Treaty on European Union. Simultaneously therefore, the Member States are reducing their commitment to economic intervention, in part as a result of pressure exerted by the European Community, and the Community itself is increasing its involvement in industrial policy.

These developments seem to be contradictory. It appears that the Member States collectively have recovered at the European level a degree of control over the economy which they had previously lost at the national level. It further appears that within the single framework of Community law the Member States are now collectively pursuing those policies at the Community level which the same law bars them from pursuing individually at the national level.

This apparent contradiction is reinforced by the fact that the ideal types of competition policy and industrial policy are usually presented as diametrically opposed forms of government-industry relations. in this binary conceptual scheme, competition policy is seen as the 'rule of economic law', characterised by strict procedures which aim to balance individual interests, but are founded on the application of general rules which aim to protect the intrinsic value of the process of economic competition. According to this view, Competition policy is based on rules, procedure and precedent, the institutional independence of competition authorities, as well as on the transparency of procedures involved.

Industrial policy on the contrary is seen as focused on the structure of the economy and its international competitiveness. It aims to achieve diverse social and political values such as growth, regional cohesion and employment. Consequently, in their pursuit of industrial policy, public authorities widely identify . . .

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