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Austria’s Competition Authority Warns Against Political Interference in Competition Policy

· December 4, 2019

Calls from politicians seeking to influence competition law enforcement are nothing new, but they appeared particularly intense around the EC’s Siemens / Alstom prohibition decision of February 2019. It’s not surprising, but at least the experts continue to resist. Even newly re-appointed competition chief Margrethe Vestager has said, both to the public and to politicians, that in Europe, the independence of competition enforcement is “non-negotiable”. Add to the list the Austrian Federal Competition Authority (Bundeswettbewerbsbehörde, or BWB).

In a paper published 26 November 2019, the BWB details the results of its study of the economic impact that politicisation of competition law would have, particularly with regards to merger control and the call for the creation of European champions. In its press release, the BWB notes “Companies do not become global market leaders because states have decided to shield them against competition, but because they know they have to stay innovative in an internationally competitive environment. As individual companies in an economy become more and more efficient, economic growth and employment also grow.” Other competition authorities should also push back on the calls for intervention on non-competition policy concerns.

There is a broad consensus at present amongst economists and competition law experts in Europe, North America and Australasia that competition law should be adopted and applied in pursuance of economic efficiency and welfare. Even the hipsters of antitrust agree, “Antimonopoly must focus on structures and processes of competition, not outcomes”. While there are legitimate questions regarding the appropriate level of antitrust intervention, attempting to shoe-horn political agendas into competition enforcement would set a dangerous precedent that could spread to other jurisdictions as well. As the BWB correctly notes

initiatives in other areas, such as in relation to trade policy or state aid, would be far more appropriate to protect European companies from unfair competition by state-subsidised companies. It has been the long-term goal, and should continue to be so, to establish tried-and-tested European competition rules and standards among the EU’s trading partners as well, creating a truly level playing field for all.” 

Competition experts should continue to hold sway in the public policy debate, as leaving competition enforcement to the shifting political moods of the day would cause long-term damage, not only to consumers in the jurisdiction concerned, but to the stability of the global economic system at large.

European Union

DisCo is dedicated to examining technology and policy at a global scale.  Developments in the European Union play a considerable role in shaping both European and global technology markets.  EU regulations related to copyright, competition, privacy, innovation, and trade all affect the international development of technology and tech markets.