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Competition Policy

Impact Assessment for a possible New Competition Tool

The Impact Assessment for a New Competition Tool and that of the Digital Services Act (‘DSA’) package: ex ante regulatory instrument of very large online platforms acting as gatekeepers have been combined into a single Impact Assessment accompanying the legislative proposal for a Digital Markets Act.

The two initiatives were subject to two parallel public consultations which given the breadth of the topics covered were initially published separately. Since the outset, however, both consultations were aimed at complementary solutions by “ensur[ing] a joint analysis of the results”, “with a view to exploring synergies and ensuring consistency on the policy options pursued, in particular as regards possible remedies and enforcement”.

More details on the Digital Markets Act can be found here. For the full legislative proposal, please click here. All materials are available in all EU languages.

 

Policy field

Competition: Antitrust

 

Background

Commission President von der Leyen tasked Executive Vice-President Vestager in her mission letter with making sure that “competition policy and rules are fit for the modern economy” as well as “strengthening competition enforcement in all sectors”. The proposal for a New Competition Tool is one of the measures aimed at fulfilling this task by addressing gaps in the current EU competition rules and allowing for timely and effective intervention against structural competition problems across markets.

This initiative is based on the Commission’s experience with enforcing the EU competition rules in digital and other markets, as well as on the worldwide reflection process about the need for changes to the current competition law framework to allow for enforcement action preserving the competitiveness of markets in times of increased digitisation and market concentration. It seeks to complement the existing EU competition rules by adding a new market investigation tool aimed at addressing structural competition problems across markets. This includes structural competition problems that the current rules cannot tackle (e.g., monopolisation strategies by non-dominant companies with market power) or cannot address in the most effective manner (e.g., parallel leveraging strategies by dominant companies into multiple adjacent markets).

The New Competition Tool is one of the three pillars through which the Commission seeks more effective competition across the economy and a fairer digital ecosystem with a view to strengthening the Single Market for the ultimate benefit of European consumers. The other two pillars are, first, a continued vigorous enforcement of Articles 101 and 102 of the Treaty on the Functioning of the European Union and, second, possible ex ante regulation for digital gatekeeper platforms.

 

Procedural Milestones

In line with Better Regulation Principles, the Commission is conducting an impact assessment for a possible New Competition Tool. The purpose of this impact assessment is to identify whether there is a need for a New Competition Tool that would allow the Commission to intervene against structural competition problems, and if so, to devise such a tool to allow it to intervene in an effective and timely manner.

The impact assessment was launched on 2 June 2020 and its progress can be followed on the Better Regulation Portal. A parallel impact assessment was launched concerning the Digital Services Act rules on ex ante regulatory rules of very large online platforms acting as gatekeepers.

  1. The inception impact assessment was published on 2 June 2020. Stakeholders could submit their comments through the Better Regulation Portal by 30 June 2020 (midnight Brussels time) and all comments are published here.
  2. The open public consultation was published on 2 June 2020 and stayed open until 8 September 2020 (midnight Brussels time).

A. Results of the public consultation

188 stakeholders filled in the questionnaire. Their replies are available on the Better Regulation webpage.

Factual summary of the contributions received in the context of the open public consultation on the New Competition Tool.

B. Contributions outside Better Regulation Portal

C. Contributions of the National Competition Authorities of the European Economic Area (NCAs)

Summary of the contributions of the National Competition Authorities to the consultation on the New Competition Tool.

D. Experts’ reports:

  1. Prof. Massimo Motta and Prof. Martin Peitz: Intervention triggers and underlying theories of harm
  2. Prof. Pierre Larouche and Prof. Alexandre de Streel: Interplay between the New Competition Tool and Sector-Specific Regulation in the EU
  3. Prof. Heike Schweitzer: The New Competition Tool: Its institutional set up and procedural design
  4. Prof. Richard Whish: Legal comparative study of existing competition tools aimed at addressing structural competition problems, with a particular focus on the UK’s market investigation tool

E. Report by the Economic Advisory Group on Competition Policy (EAGCP)

Gregory S. Crawford, Patrick Rey, Monika Schnitzer, An Economic Evaluation of the EC’s Proposed "New Competition Tool".

F. Miscellaneous

Workshop with the members of BEUC (European Consumer Organisation) on the ongoing impact assessment for a possible New Competition Tool, minutes of the video call

G. Next steps

The first result of the Impact Assessment for a New Competition Tool can be found in the way in which its results have been folded into the Digital Markets Act to make it dynamic and future proof .The replies of citizens and stakeholders to the Commission’s public consultation and the feedback of the NCAs indicate that market failures appear to be widespread across the Union, in particular in digital markets of cross-border nature. While respondents indicated that market failures may occur in all industry sectors, several respondents emphasised that they are particularly prominent in the digital sphere.

On 15 December 2020, the European Commission presented its proposal for a Digital Markets Act, a legislative proposal addressing the negative consequences arising from certain behaviours by platforms acting as digital “gatekeepers” to the single market. The new rules will establish obligations for gatekeepers, “do’s” and “don’ts” they must comply with in their daily operations. To ensure that the new gatekeeper rules keep up with the fast pace of digital markets, the Commission will carry out market investigations. These will allow the Commission to:

  • qualify companies as gatekeepers
  • update dynamically the obligations for gatekeepers when necessary
  • design remedies to tackle systematic infringements of the Digital Markets Act rules

More details on the Digital Markets Act can be found here. For the full legislative proposal, please click here. All materials are available in all EU languages.

 

Contact details

Responsible services:
Directorate-General for Competition – Unit A.1 - Antitrust Case Support and Policy.
Please always include the reference number HT. 5849 in the Subject of your correspondence.

E-Mail adress:
COMP-NEW-COMPETITION-TOOL@ec.europa.eu

Postal address:
European Commission
Directorate-General for Competition
1049 Brussels
Belgique/België