EU competition policy

The purpose of the European Union's competition policy is to increase economic efficiency in member states and to remove barriers to trade between member states. The principles of EU competition law apply in all member states and - with the exception of matters affecting only one member state - are enforced by the European Commission

Origins

The principles of EU competition law have been attributed to the combined influence of United States antitrust law and German dominance law. They were first embodied in the 1951 Treaty of Paris (which set up the European Coal and Steel Community) and subsequently in Articles 85 and 86 of the 1957 Treaty of Rome (numbered 81 and 82 in the later Treaty of Amsterdam).

Legislation

Articles 81 and 82 of the Treaty

Article 81 of the Treaty of Amsterdam prohibits as incompatible with the common market: all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between member states and which have as their object or effect the prevention, restriction or distortion of competition within the common market and in particular those which:

(a) directly or indirectly fix purchase or selling prices or any other trading conditions;

(b) limit or control production, market, technical development or investment;

(c) share markets or sources of supply;

(d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby :::placing them at a competitive disadvantage;

(e) make the conclusion of contracts subject to acceptance by the other parties of :::supplementary obligations which, by their nature or according to commercial usage, have no :::connection with the subject of such contracts.

Article 82 prohibits as incompatible with the common market: any abuse by one or more undertakings of a dominant position3 within the common market or in a substantial part of it ... in so far as it may affect trade between member states. Such abuse may in particular consist in:

(a) directly or indirectly imposing unfair purchase or selling prices or unfair trading conditions;

(b) limiting production, markets or technical development to the prejudice of consumers;

(c) applying dissimilar conditions to equivalent transactions with other trading parties, :::thereby placing them at a competitive disadvantage;

(d) making the conclusion of contracts subject to acceptance by the other parties of :::supplementary obligations which, by their nature or according to commercial usage, have no :::connection with the subject of such contracts.