WIREDGOV

The year 2010 was important for the Commission n enforcing and reforming EU competition rules, in the interest of both consumers and businesses. Last year saw a near-record amount of fines imposed on companies for operating price-fixing and market-sharing cartels in a year that was also busy dealing with the conditions of the support to banks in the context of the financial and economic crisis. On the policy front, new rules were adopted on both horizontal and vertical agreements.

These and hundreds of other examples are covered in the European Commission's 2010 Report on Competition Policy highlighting the benefits that the enforcement of Qcompetition rules brings for law-abiding companies and consumers alike.

To mark the 40th anniversary of the Annual Report on competition policy, the 2010 edition also includes an overview of the major developments of competition policy and enforcement over the past four decades.

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Background

State aid control

In 2010, the Commission issued over 400 state aid decisions. The majority of approved aid was aimed at promoting objectives of common European interest, such as research, development and innovation, regional cohesion or environment protection.

In the banking sector, the Commission dealt with the restructuring plans of, among others, Franco-Belgian bank Dexia, Belgian insurer Ethias, Aegon of the Netherlands, Parex of Latvia and Sparkasse Köln/Bonn¹ of Germany. All restructuring decisions were made necessary by recapitalisations or other support measures provided by Member States in the context of the financial and economic crisis. They included the obligation to downsize to contribute to the restructuring costs, measures to bring the necessary changes to business models where appropriate to ensure long-term viability as well as measures to mitigate distortions of competition such as acquisition and advertising bans.

Fight against cartels

In 2010, the Commission fined 70 companies nearly €3 billion in seven cartel decisions². These included the first cartel settlements (full settlement in the DRAMs case, IP/10/586 and a "hybrid" settlement, with some companies settling and others not, in the Animal Feed Phosphates case, IP/10/985) which have the benefit of concluding investigations more quickly and free up resources for other probes.

Antitrust

Important decisions were also taken in the field of antitrust in several sectors. In the transport sector, the decision in the oneworld alliance case included binding commitments by British Airways, American Airlines and Iberia ensuring that around 2.5 million passengers continue to benefit from a choice of frequencies and competitive prices on certain routes, IP/10/936). In the financial services sector, the Commission's decisions on Visa's commitments on Multilateral Interchange Fees in the EEA also generate direct benefits to merchants and consumers and contribute to the promotion of efficient payment instruments across the Single Market.

The Commission concluded several cases of abuses of dominant market positions in key sectors for consumers, such as pharmaceuticals and health (reducing barriers to entry on the market for generics, IP/11/40, MEMO/09/322, IP/10/8), energy (preventing incumbents in France, Sweden, Germany and Italy from shutting out competitors from access to energy markets, IP/10/290, IP/10/425, IP/10/494, IP/10/1197) or information and communications technologies (ensuring competitive broadband and mobile communications markets, IP/10/213, IP/10/208).

Merger control

The Commission adopted 270 merger decisions, of which 16 required the parties to amend their proposed merger plans. Three cases were decided after an in-depth analysis (Oracle/Sun Microsystems,IP/10/40, Monsanto/Syngenta, IP/10/1515 and Unilever/Sara Lee Body, IP/10/1514).

Developments in the policy field

In the field of antitrust, the Commission adopted new rules, both for agreements between companies operating at the same and at different levels of the supply chain (respectively horizontal agreements, IP/10/1702, and vertical agreements, IP/10/445). The new rules allow companies with limited market power to freely decide how their products are distributed, provided their agreements do not contain price-fixing or other hardcore restrictions (vertical agreements). The Commission leaves companies maximum freedom to cooperate while protecting competition from cooperation that would harm consumers in violation of Article 101 of the EU Treaty (horizontal agreements).

The Commisison also adopted new rules in the insurance field (IP/10/359) and for agreements between car manufacturers and their authorised dealers, repairers and spare parts distributors (IP/10/619) aligning competition policy in sales market to the general regime applicable to other sectors and creating the conditions for more competition in the after-sales market.

The full report and the accompanying staff working paper are available at:

http://ec.europa.eu/competition/publications/annual_report/index.html