Economics and the Enforcement of European Competition Law

Economics and the Enforcement of European Competition Law

Christopher Decker

Recent years have seen a trend toward an ‘economics-based’ approach to the enforcement of European competition law. But what is meant by ‘economics-based’, and how does this approach sit with legal and enforcement practice? This book seeks to place in perspective the growing use of economics in European competition law enforcement by examining precisely how economics contributes to the enforcement activity of the European Commission and Courts.

Chapter 1: Introduction

Christopher Decker

Subjects: economics and finance, competition policy, law - academic, competition and antitrust law, european law

Extract

The enforcement of European competition law has the potential to affect all European businesses and consumers. Any European who drives a car; buys petrol, toilet paper, baby food, or bacon; catches a bus, train or aeroplane; uses a mobile phone; has an X-ray or ultrasound; listens to recorded music; or consumes any product that has been transported by a shipping line, along with any employee, manager or shareholder of such business has already been affected by the enforcement of the competition laws.1 More broadly, the way that European competition law is enforced has a direct effect on the certainty and predictability of the business environment in terms of the incentives, or disincentives, it creates for business to invest, combine their activities through merger or to enter into cooperative technological and research and development projects. Economics is widely considered to be increasingly influential in the enforcement of European competition law.2 In the words of the current Chief Competition Economist of the European competition authority: ‘the fact that economics has become more important in EU antitrust policy and practice ... is hardly controversial’.3 The creation of the role of Chief Competition Economist at the competition authority is itself a relatively new development, the purpose of which was to provide an economic viewpoint to decisionmakers, as well as on-going guidance to Commission investigative staff in the 1 For consumers, these effects can relate to the price, availability, range and quality of products in a market. For management, enforcement activity can impact on a firm’s...