NICOSIA – The EU must tap the growth potential of the Single Market to the full, if it wants to take a sustainable growth path, Joaquín Almunia, Vice President of the European Commission responsible for Competition Policy, stressed here on Tuesday.
Speaking at a seminar organised in Nicosia on the occasion of the European Competition Day, under the title “Effective Enforcement of Competition Rules in the EU”, Commissioner Almunia said that the twin imperatives to consolidate public budgets and solve the euro crisis for good are taking their toll on the European economies and on the standards of living of the European people, adding that the latest steps taken by the European institutions go in the right direction.
The European Commissioner pointed out that the urgency to agree on the adoption of a road-map to complete a banking union and advance towards a fully-fledged fiscal union by the end of the year and to put forward a realistic plan for a genuine economic union is pretty obvious.
“These are difficult times and the calls for nationalist and protectionist policies grow louder by the day. We need to explain to our citizens that these policies have been proven wrong many years ago. We need to explain that competitive markets are a better solution; that they are able to adjust more quickly to new economic conditions and therefore recover faster in the interest of all Europeans” he said.
Austerity measures are not enough, Almunia noted, adding that “for our policies to succeed, we need Europe to take a sustainable growth path”.
Almunia underlined the need to tap the growth potential of the Single Market to the full. It won’t take too much money to complete it, it only takes leadership and political will, he noted. “This is what we should ask of Europe’s governments rather than the futile attempts to defend their national turfs” he said.
According to the Commissioner, tomorrow the Commission will approve the second package of the Single Market Act, adopted in Spring 2011, which includes ambitious proposals for the internal market on transport and confirms the importance of efficient and interconnected networks in Europe. Important steps are also planned for a European single payment area, he said.
Almunia stressed that Europe needs to repair the financial sector and put it on more solid ground. “We cannot expect to start a cycle of sustainable growth until banks go back to their core function of providing finance to the real economy” he stressed.
The EU is embarking on important restructuring of the Irish, Portuguese and Greek banks, which needed to resort to State support, and – together with the Eurogroup, the ECB and the IMF – the Commission is discussing how to use the resources of the respective Assistance Programs to finance the restructuring plans, he noted.
He also noted that in Spain, last Friday`s publication of independent stress-test results marks an important step towards the identification of final capital needs and recapitalisation of banks in distress under the condition set up in the Memorandum of Understanding adopted to focus especially on this sector.
Cyprus Commerce, Industry and Tourism Minister Neoklis Sylikiotis stressed that under the current difficult economic conditions it is of great importance to ensure that the market for basic consumer goods, food and other necessities, operates for the benefit of consumers. Systematic market monitoring and close cooperation between the consumer protection services and competition services become imperative in order to counter the effects of unfair commercial practices, illegal cartels and the abuse of dominant position of enterprises, he pointed out.
The Minister said that given the difficulties which have been met in the use of individual damages actions across Europe, Cyprus supports the introduction of a legal proposal that will foresee specific standards in all member states that will enable victims of violations of anti-trust legislation to get effective and full compensation from infringements of anti-trust laws.
Cyprus supports the development of properly structured collective redress mechanisms to encourage consumers and small businesses which otherwise would not proceed to individual damages actions, to collectively receive compensation for damages suffered as a result of practices by enterprises that distort competition.
Sylikiotis said that, given the significance of merger control, the Ministry in collaboration with the Cyprus Commission for the Protection of Competition is preparing a bill which aims at the modernisation of the law for the control of concentrations between enterprises.
Chairperson of the Cyprus Commission for the Protection of Competition Loukia Christodoulou said that many citizens who have been affected by violations of competition rules cannot exercise their rights to reparation due to the lack of an effective legal framework, and more specifically the fact that the private enforcement of the competition rules through private actions for damages are in a state of underdevelopment.
“The European Commission has already diagnosed the problem and has put the issue of action for damages very high on the agenda” she noted.
As to the effective competition in the food and retail markets, Christodoulou said that action taken by competition authorities is essential in ensuring the well functioning of competition at all levels of the retail markets and the food chain in particular, to the ultimate benefit of consumers.
According to a report prepared by the European Competition Network on the competition law enforcement and market monitoring activities by European competition authorities in the food sector, since 2004 the European Competition Authorities have investigated more than 180 antitrust cases in the food sector and close to 1300 merger cases, and carried out more than 100 sector inquiries and other monitoring actions of food markets.
Christodoulou noted that effective enforcement of competition rules presupposes cooperation between the National Competition Authorities and coordination by the European Competition Network in order to secure uniformity and coherency at the same time. Cooperation can involve coordination for simultaneous searches, dawn raids on inspections, exchange of information, discussions relating to investigations or gathering of information and interviewing of witnesses on behalf of another agency, she added.
Judge of the European Court of Justice George Arestis noted that the competition authorities need powers to enable them to address violations of EU Competition rules, adding that the powers afforded to them mainly by regulation 1/2003 are quite drastic, and in some respects draconian. This is quite understandable if one bears in mind the fact that they concern violations committed by enterprises which control large sectors of the economic and commercial life of the common market, he noted.
Because of the special character of the powers of the competition authorities, a number of procedural rights and guarantees have been developed mainly through the jurisprudence of the Court of Justice, aiming at protecting the human rights and fundamental freedoms of those concerned, he said.
According to Arestis, in doing so the Court draws inspiration from the constitutional traditions common to members states and from the European Convention on Human Rights and makes often reference to the jurisprudence of the latter.
Arestis also stressed that the role of the national courts is instrumental and proves once more that in the application of the law of the Union the national courts are European Union courts and important parties in the judicial system of the Union and its legal order. (CNA)