24
EC Competition Law in the Context of World Trade

1. Introduction

Community competition law applies not only to agreements, practices, and concentrations of those undertakings whose commercial activities are solely within the Community, but also to many whose headquarters and central activity lie mainly or even entirely elsewhere, be it the USA or Canada, the Far East, or elsewhere in Europe, as illustrated by the range of cases already discussed in this Part. This applies not only under Articles 85 and 86, but perhaps even more so in respect of the jurisdiction of the Merger Regulation as set out in its Article 1. We have seen that this applies to concentrations (including joint ventures) between companies which may have very limited commercial activity within the Community. The basis on which the Community claims jurisdiction has in each case, of course, to be firmly based on existing principles of international law. Substantive rules of jurisdiction in this area are not universally agreed nor consistently applied by all nations. It is, however, necessary to examine the declared policies of the Community in this respect and in particular its approach to extraterritorial jurisdiction.

In this context it should not be forgotten that the principles contained in Articles 85 and 86 and the secondary legislation made by the Council and Commission are also applied in parallel to the three countries, Norway, Iceland, and Liechtenstein which are the current members of the European Economic Area (EEA) formed on 1 January 1994. The EEA Agreement contains basic provisions drafted to match as closely as possible the equivalent clauses of the Treaty of Rome dealing with the four fundamental freedoms of the Community's internal market, and with competition policy. Articles 53 and 54 of the EEA Agreement are the equivalent clauses to Articles 85 and 86 of the Treaty of Rome. They are applied by the EFTA Surveillance Authority based in Brussels to undertakings in these three countries: the Authority works in close co-ordination with the European Commission in respect of competition and the other Community policies. The operations of the Surveillance Authority are subject to the judicial control of the EFTA Court, just as the European Court and Court of First Instance have authority over the European Commission. Details of the competition activities of the EFTA Surveillance Authority can be found in its Annual Reports.

It is also important to set the Community's well developed and complex system of competition law, as described in this Part, within the context not

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