Consumers and EU competition policy By Alasdair Murray ★ The European Commission has placed greater emphasis on the consumer benefits of competition
policy in recent years. But it needs to take further steps to ensure that consumer issues – and consumer groups – are better integrated into competition policy.
★ The Commission’s health and consumer affairs directorate-general (DG SANCO) needs to take
competition issues much more seriously. SANCO should devote part of its re s e a rch budget to investigating consumer-related competition issues, and also improve co-ordination with the competition and internal market DGs. In the longer term the Commission should consider stripping DG SANCO of its responsibility for health to create a department focused solely on consumer affairs.
★ The Commission also needs to help build up the capacity of consumer organisations to lodge
complaints at the European level. And the Commission should develop a more comprehensive pro c e d u re for dealing with consumer complaints. This pro c e d u re should include the option of responding to a complaint by launching a market investigation.
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N EFFECTIVE COMPETITION POLICY IS vital to the long-term health of the European economy. Competition increases the incentives for firms to reduce costs, cut prices and improve the quality of their products. It encourages the reallocation of capital from less to more productive firms. It benefits businesses which gain from greater competition between suppliers. But above all, competition benefits consumers through lower prices and better products. Competition policy is one of the European Union’s g reatest success stories. It is also one of the most integrated areas of EU policy-making. While the EU’s Council of Ministers sets the broad parameters of competition policy, the European Commission has possessed sole responsibility for both investigating and ruling on individual cases since the creation of the E u ropean Economic Community (EEC) in 1958. Once the competition commissioner takes a decision, it normally sails through the rest of the Commission. Only the European Court of Justice (ECJ) can overturn a Commission decision on a competition case.
Centre for European Reform 29 Tufton Street London SW1P 3QL UK
Thus the Commission possesses huge power both to d e t e rmine the overall direction of EU competition policy and to investigate individual cases. However, the Commission has long faced criticism for failing to place consumers at the centre of its approach to competition. Critics claim that it pays too much attention to competitors and too little to the needs of consumers when reaching decisions in competition cases.1 In contrast, the US Supreme Court has made clear that US competition policy is “for the pro t e c t i o n of competition not competitors”. 1 Alasdair Murray, ‘A fair Moreover, the Commission has referee? The European only made patchy efforts to Commission and EU involve consumers – and their competition policy’, CER re p resentative organisations – in October 2004. the competition process. The Commission has recently undertaken a number of re f o rms to integrate consumer concerns more closely into its policy-making. For example, the Commission has appointed a consumer liaison officer charged with canvassing consumer opinion on individual competition cases (see below). And it has for the first
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