CERRE Academic Co-Director, Alexandre de Streel, and CERRE Honorary Academic Director, Pierre Larouche, have co-authored a new study for the European Commission on the interplay between the envisaged New Competition Tool (NCT) and existing EU sector-specific regulation.
This study is part of the impact assessment that the European Commission is conducting for a possible New Competition Tool. It analyses the relationship between competition law and the various sectoral regulatory regimes making up the EU body of economic regulation.
Recommendations for the New Competition Tool integration
The authors explain that the proposed NCT could easily be integrated into the existing body of EU economic regulation. In light of experience with comparable tools in other jurisdictions, they make the following recommendations for integration:
- The NCT should have a horizontal scope and apply across the board to the whole economy, including regulated sectors;
- At the substantive level:
- the NCT should rest on the same theoretical basis and methodology as existing EU economic regulation, without being straitjacketed within specific competition law methodology;
- the NCT should be formulated in technology-neutral terms, i.e. using economic or functional concepts;
- the fundamental elements of the NCT should be set out in legislation, and the role of soft-law – if any – should be limited to developing or elaborating on these fundamentals;
- At the institutional level:
- NCT implementation and enforcement should be embedded within the institutional framework for coordination under Regulation 1/2003, to ensure proper coordination with competition authorities;
- If and when the NCT is applied in regulated sectors, close transversal cooperation should be put in place between the Commission (or any authority enforcing the NCT) and the relevant NRA(s) (or other regulatory authority) at every stage of the NCT implementation;
- The NCT and sectoral regulation should apply concurrently, except in the rare case where a firm would be put in a position where it could not comply with one without breaching the other, in which case an EU-level remedy under the NCT should prevail over a national sectoral remedy.
Theories of harm
Prof. Martin Peitz (CERRE Senior Research Fellow) and Prof. Massimo Motta also contributed to the Commission’s impact assessment work with a report on “Intervention triggers and underlying theories of harm“.