EUROPEAN COMMISSION Brussels, 13.7.2022 SWD(2022) 188 final COMMISSION STAFF WORKING DOCUMENT Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Report on Competition Policy 2021 {COM(2022) 337 final}



Contents INTRODUCTION 1. Antitrust and cartels 1.1. Review of antitrust rules and guidance 1.2. The fight against cartels remains a top priority 1.3. Important judgments by the European Union Courts 1.4. Cooperation within the European Competition Network and with national courts 2. Merger control 2.1. Recent enforcement trends 2.2. Review of merger control rules and guidance 2.3. Significant judgments by the Union Courts in merger control 3. State aid control 3.1. Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak 3.2. Facilitating the exit from the pandemic – Recovery and Resilience Facility (RRF) 3.3. State aid for horizontal objectives 1.4. Strengthening the Commission toolbox – a new policy initiative redressing distortive foreign subsidies 3.5. Monitoring, recovery and cooperation with national courts 4. Developing the international dimension of EU competition policy 1.5. Multilateral relations

1.6. Bilateral relations 5. Supporting EU competition law enforcement 5.1. Digital transformation 5.2. Single Market Programme 5.3. External Communication and Advocacy II. SECTORAL OVERVIEW 1. Energy & environment 2. Information and Communication Technologies and media 3. Financial services 4. Basic industries and manufacturing 5. Agri-food industry 5.1 Overview of key challenges in the sector 6. Pharmaceutical and health services sectors 7. Transport, tourism, and postal services 8. Taxation and State aid ANNEX 1 State aid decisions adopted under the Temporary Framework for State aid measures in 2021 by country ANNEX II State aid decisions COVID -19 related, adopted directly under the Treaty by country ANNEX III Banking State aid cases: Decisions adopted by the Commission in 2021

by country

INTRODUCTION The Report on Competition Policy 2021 and this Staff Working Document provide the second account of the competition policy developments under the Commission led by President von der Leyen. Covering the developments in EU competition policy in 2021, it also is the 51st year the Commission submits such a report. As the lessons from the most severe pandemic in more than 100 years have shown across the EU, a robust competition policy and its effective enforcement is more important than ever. EU competition policy preserves and strengthens the Single market, benefits consumers, businesses and society alike. In 2021, EU competition policy continued to play an important role in the EU’s efforts to respond to and overcome the health and economic crisis due to the COVID-19 pandemic. The Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak (Temporary Framework for State aid measures) to support the economy in the current COVID-19 outbreak enabled necessary and proportionate support by Member States to businesses, especially small and medium-sized enterprises (‘SMEs’), in risk because of the pandemic, while limiting negative effects on the internal market. To address the consequences of the current political and economic situation in Europe due to Russia’s invasion of Ukraine, the Commission will again use the flexibility of the State-aid policy toolbox, which will enable Member States to tackle the negative economic effects of the new emergency. Despite the pandemic continuing worldwide, the enforcement of EU competition rules remained at a very high level in 2021. In addition to the 675 COVID-19 related State aid decisions adopted in 2021, the merger control activity remained effective with 396 merger decisions adopted by the Commission. Also in antitrust and cartels the Commission took important enforcement actions to address competition infringements and imposed a total of EUR 1 746 million in fines. The decisions covered numerous sectors such as financial markets, railway transport services, car emissions, food and biofuels. In addition, the Commission closely cooperated and coordinated on related competition issues in the European Competition Network (ECN). As set out in its Communication on a Competition Policy fit for new challenges , the Commission is undertaking an unprecedented review of EU competition policy, covering more than 20 sets of rules with the objective of making sure that EU competition policy instruments remain future-proof and support the EU’s green and digital transitions, the recovery process and the response to economic developments and to strengthen the resilience of the Single Market. In 2021, progress was also made by co-legislators as regards the Commission proposal for the Digital Markets Act and the Regulation on foreign subsidies distorting the internal market. Finally, in the area of merger control, the Commission took measures, such as the acceptance of electronic notifications, to ensure business continuity for companies notifying transactions, while ensuring compliance with legal obligations, took measures to ensure business continuity for companies notifying transactions, while ensuring compliance with legal obligations, and continued to safeguard the implementation of the EU merger rules. The present Staff Working Document is composed of two parts. The first part presents the main developments in 2021 across the three competition instruments: State aid, antitrust (including cartels) and mergers. In the second part, specific enforcement actions are detailed in a sectoral overview.



I. MAIN DEVELOPMENTS IN COMPETITION POLICY AND ENFORCEMENT 1.Antitrust and cartels Articles 101, 102 and 106 TFEU According to Article 101 TFEU, anti-competitive agreements are prohibited as incompatible with the internal market. Article 101 TFEU prohibits agreements with an anti-competitive object or effects where companies coordinate their behaviour instead of competing independently. However, even if a horizontal or a vertical agreement could be viewed as restrictive it might be allowed under Article 101(3) TFEU if it ultimately fosters competition (for example by promoting technical progress or by improving distribution). Article 102 TFEU prohibits abuse of a dominant position. It is not in itself illegal for an undertaking to be in a dominant position or to acquire such a position. Dominant undertakings, as any other undertaking in the market, are entitled to compete on the merits. However, Article 102 TFEU prohibits the abusive behaviour by dominant undertakings that, for example, directly or indirectly impose unfair purchase- or selling prices or other unfair trading conditions. Finally, Article 106 TFEU prevents Member States from enacting or maintaining in force measures contrary to the Treaty rules regarding public undertakings and undertakings to which Member States grant special or exclusive rights. Preserving market discipline to secure the functioning of the Single Market is essential especially in times of crisis. Effective enforcement of the EU competition rules is of vital importance to the digital transformation of the EU economy and to preserve the Single Market’s competitiveness and ability to adapt. Antitrust enforcement can contribute in tearing down remaining barriers to the Single Market and eliminating restrictions in the development of clean technologies and the free flow of resources necessary for the circular economy and the European Green Deal’s objectives. The present Staff Working Document highlights recent antitrust and cartel decisions, while the graphs below give an overview of antitrust enforcement activity in the past ten years, including also decisions rejecting complaints.

In 2021, the Commission made substantial progress on its ambitious review of competition policy, covering a number of its key block exemption regulations, guidelines and notices. In November 2021, the Commission adopted a Communication on a competition policy fit for new challenges, which underlined the role of competition policy for the post-pandemic economic recovery, for the green and digital transitions and for a resilient Single Market. Alongside enforcement, reforms are crucial to ensure competition policy remains fully effective. In 2021, the Commission advanced on its review agenda encompassing a large number of its key block exemption regulations, guidelines and notices as well as moved forward the work on a number of ongoing initiatives to ensure fair competition in the Single Market. Antitrust and cartel decisions 2012-2021 1.1. Review of antitrust rules and guidance In 2021, the Commission advanced on its review of antitrust rules and guidance to ensure that they are fit for a changing market environment, including the accelerating digitalisation of the economy and presented a new initiative on the application of competition law to collective agreements for the solo self-employed. 1.1.1. COVID-19 pandemic related guidance The Temporary Framework for State aid measures for assessing antitrust issues related to business cooperation in response to situations of urgency stemming from the COVID-19 pandemic, adopted in April 2020 , introduced the possibility of adopting ad hoc comfort letters, as a temporary tool. These are an exception to the self-assessment rule, and appear in addition to the existing routes for providing guidance in specific situations, as these existing routes cannot address situations of extreme urgency due to their procedural requirements. The Commission clarified that it will use its discretion to decide how and when to provide guidance, but that it is ready to engage and discuss and will ensure that its extensive general guidance reflects today’s needs and business realities. On 25 March 2021, the Commission issued the second comfort letter since the adoption of the Temporary Framework for State aid measures. The letter was issued on the occasion of a pan-European matchmaking event hosted by the Commission. The aim was to address bottlenecks and speed up connections between vaccine producers and service companies (such as contract development and manufacturing organisations, fill and finish equipment producers and others) to improve planning for current and future vaccine production in Europe. 1.1.2. Guidance on vertical agreements The Commission continued its impact assessment for the revision of the Vertical Block Exemption Regulation (VBER) and the accompanying Guidelines on Vertical Restraints (Vertical Guidelines), publishing the results of the open public consultation that ended on 26 March 2021 and the summary of the contributions of the National Competition Authorities (NCAs) to the impact assessment of the Vertical Block Exemption Regulation, together with an expert report on ‘Active sales restrictions in different distribution models and combinations of distribution models’ and an expert report on ‘Cases dealing with online sales, and online advertising, restrictions at EU and national level’. On 9 July 2021, the Commission published a draft revised VBER and draft revised Vertical Guidelines for public consultation, together with a background note setting out the proposed changes. This public consultation ended on 17 September 2021. On 22 November 2021, the Commission published the non-confidential contributions received from stakeholders on the draft revised rules, as well as a summary of all contributions on the draft rules. On 28 May 2021, the Commission published the report of the evaluation of the Motor Vehicle Block Exemption Regulation (MVBER) and the accompagnying Staff Working Document. Overall, the evaluation concluded that, in the last decade, there have been no material developments that would justify a revamp of the MVBER regime, but that an update was necessary to reflect the importance that access to vehicle-generated data is likely to have as a factor of competition. The Commission is now working on the proposals for the future of the regime in view of the expiration of the regime on 31 May 2023. 1.1.3. Guidance on horizontal agreements In May 2021, the Commission published the results evaluation of the two horizontal block exemption regulations on Research & Development and specialisation agreements (abbreviated R&D BER and Specialisation BER respectively, together HBERs), together with the Horizontal Guidelines. The aim of this evaluation is to support the Commission decision on whether it should let the HBERs lapse, prolong their duration or revise them. Key findings from the evaluation of the rules on horizontal agreements The evaluation showed that the rules on horizontal agreements remain useful tools for businesses. However, the evaluation identified several areas where the rules are not sufficiently adapted to digitisation and the pursuit of sustainability goals. Some of the provisions in the HBERs are viewed as rigid and complex, while others are considered unclear and difficult to interpret by companies. More specifically, the conditions for exemption in the R&D BER may no longer capture all pro-competitive R&D agreements and the scope of the Specialisation BER may be too narrow. Some provisions in the HBERs and Horizontal Guidelines are also considered unclear or overly strict. Finally, the Horizontal Guidelines offer little guidance on recent market developments such as digitisation and sustainability objectives in horizontal agreements (for example, they do not provide sufficient legal certainty for the self-assessment of agreements pursuing sustainability objectives, data sharing/data pooling agreements, and network sharing agreements).

In July 2021, the Commission launched a public consultation as part of the impact assessment phase of the revision . The Commission aims to have the revised rules in place by 31 December 2022 when the current rules expire. 1.1.4. Collective agreements regarding the working conditions of solo self-employed persons Digital labour platforms have changed the way people work. They provide access to work, and flexibility, but they can also lead to poor working conditions. For self-employed persons providing services through digital labour platforms, it is not always clear whether EU competition rules allow such self-employed persons to collectively negotiate and conclude agreements on their working conditions. To address this issue, in June 2020 the Commission had launched a process to assess whether there is a need for measures at EU level to ensure that EU competition law does not stand in the way of collective agreements of self-employed persons aiming to improve their working conditions. The Commission therefore in January 2021 published an inception impact assessment, and in March 2021 consulted all stakeholders on a detailed questionnaire. In April 2021, a dedicated meeting with Social Partners took place. On 9 December 2021, the Commission published draft Guidelines on the application of EU competition law to collective agreements regarding the working conditions of solo self-employed persons . Based on established case-law of the Court of Justice of the European Union (CJEU) , the draft Guidelines describe situations when solo self-employed persons may be comparable to workers, and clarify that their collective agreements then fall outside the scope of Article 101 TFEU. This covers economically dependent solo self-employed persons, those working side-by-side with workers and those providing their services through digital labour platforms. Furthermore, the draft Guidelines clarify that self-employed persons who may not be comparable to workers, but may nevertheless have difficulties in influencing their working conditions due to an imbalanced bargaining power, may also negotiate collectively without fearing the Commission's intervention. This includes solo self-employed persons who negotiate their working conditions with counterparties of some economic strength; or persons who collectively negotiate in line with the Copyright Directive and national law provisions. 1.2. The fight against cartels remains a top priority The Commission’s strong cartel enforcement record in 2021 shows its continued determination to vigorously fight cartels and to protect the competitive process during the recovery period. In 2021, the Commission adopted 10 decisions and imposed a fines totalling EUR 1746 million. The decisions covered numerous sectors such as financial markets, railway transport services, car emissions, food and biofuels. The Commission was also able to gradually resume its inspection activities that had been temporarily suspended for sanitary and logistic reasons during the earlier phase of the pandemic. In particular, the Commission had a strong focus on cartels in the financial services in 2021. In April 2021 , the Commission adopted a decision against Bank of America Merrill Lynch, Crédit Agricole, Credit Suisse and Deutsche Bank for taking part in a cartel concerningSupra-sovereign, Sovereign and Agency bonds denominated in US Dollars (USD SSA bonds). The Commission imposed fines totalling EUR 28.494 million against these banks, except Deutsche Bank, which revealed the existence of the cartel and received full immunity under the leniency procedure. In May 2021, the Commission fined Bank of America, Natixis, Nomura, UBS, UniCredit and WestLB (now Portigon) a total of EUR 371 million in respect of a cartel in the primary and secondary market for European Government Bonds (EGB). RBS (now NatWest) was not fined as it received full immunity under the leniency procedure for revealing the cartel. In December 2021, the Commission concluded the third stage of its investigation into the Foreign Exchange spot trading market . The Commission fined Barclays, RBS HSBC and Credit Suisse a total amount of EUR 344 million (which came on top of the EUR 1.07 billion that had already been imposed in the two earlier Forex cases). UBS was not fined as it received full immunity under the leniency procedure for revealing the existence of the cartels. Furthermore, in July 2021, the Commission took a decision against five car manufacturers Daimler, BMW, Volkswagen, Audi and Porsche . The Commission imposed fines totalling EUR 875 million against these car manufacturers for restricting technical development in the area of emission cleaning technology for diesel cars. Daimler was not fined because it revealed the existence of the cartel. All companies acknowledged their involvement in the cartel and agreed to settle the case. In April 2021, in the railway transport services , the Commission sanctioned Österreichische Bundesbahnen (ÖBB), Deutsche Bahn (DB) and Société Nationale des Chemins de fer belges/Nationale Maatschappij der Belgische Spoorwegen (SNCB) for their participation in a customer allocation cartel, which concerned cross-border rail cargo transport services on so-called blocktrains on key EU rail corridors. The three companies admitted their involvement in the cartel and agreed to settle the case. The Commission fined DB and SNCB a total of EUR 48 million, while ÖBB received full immunity. In the agri-food sector, in November 2021, the Commission fined Conserve Italia Soc. coop. agricola and its subsidiary Conserves France S.A. (together ‘Conserve Italia') , totalling EUR 20 million. The decision follows an earlier settlement decision adopted in September 2019 against three other undertakings for participating in the same cartel. Conserve Italia decided not to settle the case and, as a result, the Commission's investigation against Conserve Italia continued under the standard cartel procedure. For more than 13 years, from 2000 to 2013, Conserve Italia and the other cartel participants set prices, agreed on market shares and volume quotas, allocated customers and markets, exchanged commercially sensitive information, and coordinated their replies to tenders. Finally, in December 2021, the Commission fined Abengoa S.A. and its subsidiary Abengoa Bionenergía S.A. , EUR 20 million for participation in a cartel concerning the wholesale price formation mechanism in the European ethanol market. Biofuels can contribute to promote cleaner transport and reduce greenhouse gas emissions and therefore play a key role in the green transition. The investigation is still ongoing for the other companies concerned. Cartel decisions 2021: Case name Adoption date Fine imposed EUR Undertakings concerned Prohibition Procedure Rail Cargo 20/04/2021 48 594 000 3 Settlement SSA bonds 28/04/2021 28 494 000 4 Prohibition EGB 20/05/2021 371 393 000 7 Prohibition YIRD re-adoption 28/05/2021 6 450 000 1 Prohibition EIRD re-adoption 28/06/2021 31 739 000 1 Prohibition Car emissions 08/07/2021 875 189 000 3 Settlement Canned vegetables 19/11/2021 20 000 000 1 Prohibition Forex (Sterling lads) 02/12/2021 83 294 000 1 Prohibition Forex (Sterling lads) 02/12/2021 261 101 000 4 Settlement Ethanol benchmarks 10/12/2021 20 000 000 1 Settlement Total 1 746 254 000 26 1.3. Important judgments by the European Union Courts In 2021, the Union Courts issued a comparatively small number of judgments concerning the Commission’s cartel enforcement compared to the situation a few years ago. However, the overwhelming majority of judgments issued fully confirmed the Commission’s cartel enforcement practice. This included a confirmation from the CJEU of the Commission’s practice of conducting hybrid settlement proceedings. The courts also confirmed that Article 101 TFEU and Article 53 of the EEA Agreement provide the Commission with jurisdiction to review cartels that operate worldwide.

1.3.1. Procedural rights in Commission investigations – staggered hybrid cases In a judgment concerning the Steel Abrasives cartel, the CJEU held that the Commission had not breached a company’s defence rights by referring to it in a settlement decision that predated its sanctioning in a decision taken in ordinary procedure (staggered hybrid settlement case). In the CJEU’s view, the Commission did not breach the presumption of innocence and the principle of impartiality. The CJEU agreed with the General Court that the Commission had taken “sufficient precautions” in its drafting, stating “unequivocally” that the settlement decision was not addressed to the appellant and that it referred to the company where it was necessary to do so to establish the liability of the other members of the cartel. 1.3.2. The Commission’s jurisdiction In two judgments concerning the Capacitors cartel, the General Court confirmed the Commission’s territorial jurisdiction in the application of Article 101 TFEU and Article 53 of the EEA Agreement. The applicants contested the Commission’s territorial jurisdiction, namely on the ground that the anticompetitive conduct was Asia-oriented and was neither implemented nor had a significant effect in the EEA and refuting any relevant link to the EEA. According to the General Court, the conditions for the territorial application of Article 101 TFEU and Article 53 of the EEA Agreement are satisfied in two situations: in the first place, where the practices covered by that article are implemented in the territory of the internal market, irrespective of the place where they were formed and, in the second place, where it is foreseeable that those practices will have an immediate and substantial effect in the internal market. The General Court stated that the criterion of the implementation of the cartel is satisfied by, among other things, mere sales within the European Union of the product that is the subject of the cartel, irrespective of the location of the sources of supply and the production plants. 1.3.3. Liability for cartel conduct In a judgment concerning the Power Cables cartel, the CJEU confirmed the Commission’s and the General Court’s interpretation of the concept of ‘parental liability’ for attributing liability for a company’s cartel conduct to its parents. The CJEU confirmed that the Commission was entitled to rely on the AKZO presumption of a parent exercising decisive influence over a subsidiary not only in a situation where it held all or virtually all the capital of the subsidiary, but also where it held all the voting rights associated with its subsidiary’s shares. In the same judgment, the CJEU also confirmed that the Commission was right to rely on personal links concerning the board composition of the subsidiary when finding that a parent company exercised decisive influence. Such personal links could indeed be found even in situations where a member of a company’s board is connected to another company through ‘previous advisory services’ or ‘consultancy agreements’. In the Retail Food Packaging cartel, the CJEU confirmed settled case law on the presumption of effective exercise of decisive influence of a parent company over its controlled operating companies and further confirmed the Commission’s cartel enforcement practice in this respect. 1.3.4. Setting of fines In a judgment concerning the Steel Abrasives cartel, the CJEU set aside a part of the General Court’s judgment that reduced the original fine from EUR 6.2 million to EUR 3.87 million . In the CJEU’s view, the General Court had violated the principle of equal treatment and failed to state proper reasons when it applied a 75% discount under point 37 of the Commission’s Guidelines on Fines to the appellant – a discount that was identical to that given to a different company. The CJEU held that the General Court had failed to set out the reasons why, despite that difference in situation, it was consistent with the principle of equal treatment to grant the appellant a rate of reduction identical to that granted to the other company . In a judgment concerning the Capacitors cartel, the General Court confirmed the Commission’s decision to increase the fine, since the company had been held liable for a similar infringement in the past . The Commission found that, notwithstanding the fact that that first infringement had been penalised when the infringement found in Capacitors cartel was ongoing, it was necessary to apply an increase in the basic amount of the fine on account for repeated infringement, and, consequently, to take into account the entire period of the company’s liability for the infringement, including a period of almost nine months preceding the adoption of the original DRAMs decision. The General Court considered that the company had already been found to have committed an infringement and that, despite that finding and the penalty imposed, it had continued to participate for almost two years in another similar infringement .. The General Court, in another judgment concerning the Capacitors cartel , also confirmed that the Commission did neither infringe the principle of ne bis in idem nor the principle of proportionality when applying a deterrence factor of 16% despite there already having been substantial fines imposed in other jurisdictions. In the Retail Food Packaging cartel case, the president of the General Court issued a court order dismissing an application for interim measures seeking the suspension of a Commission decision against CCPL, and ordering it to pay fines of EUR 9.44 million. The Commission had re-imposed a significantly lower fine on CCPL following an earlier successful appeal by the company concerning lack of sufficient reasoning regarding the company’s ability to pay the fine. In his court order, the president of the General Court stated that any appeal against the revised Commission decision was unlikely to be successful, as the Commission appeared to have conducted a sufficient analysis of CCPL's financial situation . 1.3.5. Payment of cartel fines In the Commission v Printeos, concerning the Envelopes cartel, the CJEU dismissed the Commission’s appeal and upheld the judgment of the General Court, ruling that the Commission is obliged to pay default interest when reimbursing a competition fine provisionally paid by an addressee who contested it, and which is later annulled or decreased by the courts. Printeos was entitled to receive: 1) a default interest from the date the fine was provisionally paid until the date of its repayment to Printeos (at ECB refinancing rate plus 2 %); and 2) a compound default interest on the above amount of default interest from the date Printeos lodged its action before the General Court (i.e. ordering payment of interests on an unpaid default interest, at ECB refinancing rate plus 3.5 %). 1.3.6. Application of the Commission’s Leniency Notice

In a judgment concerning the Car Battery Recycling cartel, the CJEU confirmed the Commission’s and the General Court’s interpretation of the Commission’s 2006 Leniency Notice . The CJEU held that the concept of ‘partial immunity’ should apply only to undertakings that adduce evidence concerning new facts previously unknown to the Commission. A mere strengthening of evidence already in the Commission’s possession was insufficient for a company to obtain partial immunity . Along similar lines, the CJEU confirmed in a judgment concerning the Retail Food Packaging cartel the Commission’s and General Court’s position that the appellant in that case did not qualify for immunity under the Commission’s 2006 Leniency Notice, as another company first provided the Commission with information enabling it to conduct an unannounced inspection. In a judgment concerning the Capacitors cartel , the General Court confirmed the Commission’s practical application of the concept of ‘partial immunity’. In this case, the applicant provided the Commission with additional information allowing it to extend the duration of the infringement, and, in return, the Commission granted partial immunity to the applicant t for the extended time period, thereby reducing the duration multiplier used for the applicant accordingly. However, the Commission did not reduce the applicant’s gravity multiplier. In its judgment, the General Court confirms the Commission’s conclusion that the evidence submitted by the applicant had no impact on the gravity of the infringement. 1.3.7. Private Enforcement of EU Competition Law Due to the increase of antitrust damage actions and the application of the Damages Directive, national courts have referred many questions for a preliminary ruling to the CJEU concerning application of the Damages Directive. In 2021, the CJEU rendered its judgments in three of these cases. On international and territorial jurisdiction On 15 July 2021, the CJEU rendered its judgement in case RH vs Volvo . Supplementing the 2019 case Tibor-Trans v. DAF Trucks , the judgment provided detailed guidance on how to allocate jurisdiction over cartel damages claims under Article 7(2) of the Regulation No 1215/2012 Brussels I Recast. A legal or natural person domiciled in a Member State may be sued in another Member State before the courts for the place where the harmful event occurred or may occur. Consequently, in an action for damages caused by an infringement of Article 101 TFEU, the place where the damage occurred is situated in the Member State of the market affected by that infringement in which additional costs were incurred. The CJEU pointed out that two criteria should be applied to identify the competent court in the Member States. First, if the undertaking that has been harmed purchased the goods affected by the collusion exclusively within the jurisdiction of a single court, that court has jurisdiction. Secondly, if purchases were made in several places, each undertaking that has been harmed can bring the action before the court for the place where the claimant has its registered office. On the notion of undertaking In its judgment of 6 October 2021, the CJEU dealt with a question for a preliminary ruling submitted by a Spanish court in case Sumal . The judgment clarifies, among other things that, the functional concept of an undertaking is applicable both in the public and the private enforcement of EU competition law. In follow-on actions for damages, a fully-owned subsidiary may be held liable for an infringement of EU competition law of its parent company, on the condition that they form an economic unity. The decisive criterion to identify an economic unity is an uniform behaviour on the market. The CJEU clarified that the delineation of economic unity is based on a two-step test: (i) the economic, organisational and legal links and (ii) the special link between the economic activity of the subsidiary and the subject matter of the parent's infringement. It is on the claimant to prove both links. In light of the functional concept of an undertaking, a parent company can be part of several economic units. On the jurisdiction of national courts to apply Article 101 TFEU On 11 November 2021, the CJEU rendered a judgment in the case Stichting Cartel Compensation , confirming that a national court has the power to find an infringement of Article 101 TFEU and to award antitrust damages also for the period when the Commission did not have at its disposal effective powers for the enforcement of EU competition law. The preliminary questions referred to the Court arose in a dispute concerning damage claims in respect of conduct in the air transport sector, that had occurred prior to the application of the rules implementing Article 101 TFEU. At the relevant time the transitional regime of Articles 104 and 105 TFEU applied. In the underlying decision concerning the same conduct (Airfreight) the Commission had decided that it could not apply Article 101 TFEU to the conduct for the time period covered by the transitional regime. 1.4. Cooperation within the European Competition Network and with national courts 1.4.1.Cooperation with national competition authorities within the European Competition Network Since 2004, the Commission and the national competition authorities in all EU Member States cooperate through the ECN. The objective of the ECN is to ensure that EU competition law is applied in an effective and coherent manner against companies engaging in business practices that restrict competition in the EU. In 2021, the Commission continued to ensure the coherent application of Regulation (EC) No 1/2003 on the implementation of the rules on competition (Articles 101 and 102 TFEU) through the ECN. Two of the key supporting cooperation mechanisms in this Regulation are the obligation of NCAs to inform the Commission on a new investigation at the stage of the first formal investigative measure and to consult the Commission on envisaged decisions. In 2021, 145 new investigations were launched within the network and 84 envisaged decisions were submitted.

In addition to those cooperation mechanisms set out in Regulation (EC) No 1/2003, other ECN cooperation work streams equally ensure a coherent enforcement of the EU competition rules. The ECN members meets regularly to discuss cases at early stages, policy issues, as well as matters of strategic importance. In 2021, 37 meetings across horizontal working groups and sector-specific sub-groups were organised, where competition authorities’ officials exchanged views. 1.4.2. The ECN+ Directive The ECN+ Directive empowering Member States' competition authorities to be more effective enforcers of EU competition rules in the field of antitrust entered into force on 4 February 2019. The ECN+ Directive aims to ensure that when applying the same legal provisions – the EU antitrust rules – national competition authorities have the effective enforcement tools and the resources necessary to detect and sanction companies that infringe Articles 101 and 102 TFEU. It also aims to ensure that they can take their decisions in full independence, based on the facts and the law. The new rules contribute to the objective of a genuine single market, promoting the overall goal of an open, competitive and innovative internal market creating jobs and growth. Member States had to transpose the Directive into national law by 4 February 2021. On 19 March 2021, the Commission sent Letters of Formal Notice, opening infringement procedures against 22 Member States for non-communicating the transposing measures by the deadline. Of those, 22 Member States, fourteen however notified full transposition of the Directive before the end of 2021. The completeness of their transposing measures will be assessed before the closure of the infringement proceedings. The Commission will then check the conformity of their national transposing measures. The Commission keeps assisting the remaining Member States in the last stages of their transposition processes. 1.4.3. Cooperation with national courts In addition to its cooperation with NCAs in the context of the ECN, the Commission also continued its cooperation with national courts. The Commission supports national courts inenforcing the EU competition rules in an effective and coherent manner by providing case-related information or opinions on matters of substance or by intervening as amicus curiae in proceedings pending before the national courts. Following approval from the concerned courts, the Commission publishes its opinions and amicus curiae observations on its website. 1.4.4. Private enforcement Directive 2014/104/EU on antitrust damages actions (Damages Directive) aims at ensuring that anyone harmed by infringements of the EU competition rules can effectively avail itself of the right to compensation before national courts. As noted in the report about the implementation of the Damages Directive to the European Parliament and the Council of December 2020, since the adoption of the Damages Directive in 2014, the number of damages actions before national courts has increased significantly, and actions for damages have become much more widespread in the EU . A significant number of actions are still follow-on actions, where the person harmed by a competition law infringement claims damages following a final decision of a competition authority. The Commission continues to monitor the implementation of the Directive by the national courts of the Member States with a view to reviewing the Directive, once sufficient experience from the application of its rules is available. 2.Merger control EU merger control The purpose of EU merger control is to ensure that market structures remain competitive while enabling smooth restructuring of the industry. This applies not only to EU-based companies, but also to any company active on the EU markets. Industry restructuring is an important way of fostering efficient allocation of production assets. However, there are also situations where industry consolidation can give rise to harmful effects on competition, taking into account the merging companies’ degree of market power and other market features. EU merger control ensures that changes in the market structure which lead to harmful effects on competition do not occur. EU merger control ensures that all firms active in EU markets can compete on fair and equal terms. Proposed transactions which may distort competition are subject to close scrutiny by the Commission. If necessary to protect competition, the Commission can give merging firms the possibility to dispel competition concerns by offering commitments. If sufficient commitments cannot be found or agreed upon, the Commission may prohibit the transaction. In its assessments, the Commission takes into account efficiencies possibly brought about by mergers. Efficiencies may have positive effects on costs and innovation, for example, provided that they are verifiable, merger-specific and likely to be passed on to consumers. 2.1. Recent enforcement trends While the COVID-19 pandemic continued throughout 2021, the Commission’s enforcement activity remained at a very high level with a total number of 396 merger decisions adopted in 2021(405 notifications) the highest on record. Moreover, in 2021 the Commission received 44 reasoned submissions by notifying parties in pre-notification, requesting a referral of a case from the Commission to a national competition authority or vice versa. The Commission accepted to examine two transactions following a referral pursuant to Article 22 of Council Regulation (EC) No 139/2004 (the ‘EU Merger Regulation’) and referred four transactions pursuant to Article 9 of the EU Merger Regulation to be examined by national competition authorities.

The vast majority of mergers notified in 2021 did not raise competition concerns and were speedily reviewed. The simplified procedure was applied in 78% of all notified transactions under the EU Merger Regulation in 2021. Nevertheless, in 2021, the Commission’s merger enforcement was intensive due to the large number of notified transactions as well as the complexity of a significant number of cases. Moreover, the Commission intervened in fourteen cases. An increasing number of notified transactions concerned already concentrated industries. Reviewing such transactions required the Commission to carefully assess their potential impact on competition, employing sophisticated quantitative techniques and comprehensive qualitative investigative tools. In 2021, the Commission opened in-depth investigations (the “Phase II”) in seven cases. These cases concerned diverse sectors of the economy, including manufacture and retail of container and cargo handling equipment, technical foams and building insulation materials such as mineral wool sandwich panels, semiconductors, the digital sector, healthcare technology, as well as passenger air transport. In line with the trends of recent years, in 2021 the Commission assessed mergers involving digital issues. For example, the Commission opened an in-depth investigation into the proposed acquisition of Kustomer by Meta (formerly Facebook) , a transaction involving the market for the supply of customer relationship management software. Digital issues were also part of the in-depth investigation of the proposed acquisition of Arm by NVIDIA . Despite the COVID-19 pandemic, the Commission’s enforcement activity remained similar to the most recent years. In 2021, the Commission adopted 396 merger decisions and intervened in fourteen cases. Seven mergers were cleared subject to commitments in Phase I and four mergers were cleared subject to commitments following a Phase II investigation. Moreover, three transactions were abandoned and their notifications withdrawn during the in-depth investigation . Finally, the Commission did not prohibit any transactions in 2021. Merger outcomes 2012-2021 Most remedies accepted by the Commission in 2021 consisted of divestitures of tangible or intangible assets. This confirms the Commission’s general preference for structural remedies in merger cases as best suited to address competition concerns arising from a concentration in a durable manner. Apart from such remedies offered in Phase II investigations, in 2021, the Commission also cleared transactions subject to remedies in Phase I in which the notifying parties offered comprehensive remedy packages in due time, including in some complex transactions such as Schwarz Group/Suez Waste Management Companies in waste management . The Commission also accepted non-divestiture remedies in a few cases, where such measures were considered to effectively solve the identified competition concerns in light of the specificities of the sector and the case at hand, for instance in Siemens Healthineers/Varian Medical Systems in medical imaging and radiotherapy solutions . Moreover, the Commission adopted a decision pursuant to Article 14 of the EU Merger Regulation imposing fines of EUR 7.5 million on Sigma-Aldrich for providing incorrect or misleading information during the Commission’s investigation of Merck’s acquisition of Sigma-Aldrich in 2015 .

In 2021, following Illumina’s early implementation of its acquisition of GRAIL pending the outcome of merger review of the transaction, the Commission adopted interim measures pursuant to Article 8(5)(a) of the EU Merger Regulation to restore and maintain the conditions of effective competition. It was the first time that the Commission adopted interim measures following the early implementation of a concentration. In parallel, the Commission opened an investigation to assess a possible imposition of a fine for a breach of standardstill obligation . Finally, on 29 October 2021, the Commission announced the opening of an investigation into a possible breach of Article 21 of the EU Merger Regulation, as Hungary imposed a veto on the acquisition of two Hungarian subsidiaries AEGON by VIG, both active in the insurance sector, even though the transaction had already been unconditionally approved by the Commission on 12 August 2021. 2.2. Review of merger control rules and guidance 2.2.1. The evaluation of selected procedural and jurisdictional aspects of EU merger control In 2021, the Commission finalised and published the results of the evaluation of selected procedural and jurisdictional aspects of EU merger control. Following the evaluation results, the Commission adopted a Communication providing guidance on the application of the referral mechanism set out in Article 22 of the EU Merger Regulation to capture potentially problematic transactions below its turnover thresholds, for instance transactions involving firms that play a significant competitive role despite generating little or no turnover, or transactions involving innovative companies in sectors such as pharmaceuticals. Following the findings of the evaluation, the Commission also launched an impact assessment on exploring policy options for further simplification of merger procedures, including a potential introduction of electronic notification as the default way of notifying merger transactions. The simplification initiative aims to ease the burden on businesses as well as the Commission. 2.2.2. Market definition notice Throughout 2021, the Commission continued its review of the Commission Notice on the definition of relevant market for the purposes of Community competition law (‘Market Definition Notice’), applied in its antitrust and merger assessments. In July 2021, the Commission published the findings of the evaluation of the Market Definition Notice and started working on a revised Market Definition Notice, in particular, to ensure that it remains fit for purpose and the digital age. The revision process is ongoing and the Commission will consult stakeholders on the draft of the revised Notice in 2022. 2.3. Significant judgments by the Union Courts in merger control In its judgment of 22 September 2021, the General Court upheld the Commission’s decision imposing two fines totalling EUR 124.5 million on the telecommunications operator Altice for gun jumping, while granting Altice a limited reduction of 10% of the amount of the fine applied in relation to the infringement of the notification obligation laid down in Article 4(1) of the Merger Regulation .. In its judgment of 20 October 2021 , the General Court upheld two 2017 Commission decisions approving, under the EU Merger Regulation, the acquisition of certain Air Berlin assets by EasyJet and Lufthansa respectively. The General Court upheld the Commission’s assessment, notably confirming that the route-by-route assessment traditionally carried out by the Commission in merger cases involving airlines was not warranted in these two cases, since Air Berlin had completely and definitely ceased its operations at the time of the mergers. Furthermore, the General Court found that the analytical framework applied by the Commission under the airport-by-airport approach was sufficiently and adequately explained. 3.State aid control State aid control is an integral part of EU competition policy and a necessary safeguard to preserve effective competition and free trade in the Single Market. The Treaty establishes the principle that State aid which distorts or threatens to distort competition is prohibited in so far as it affects trade between Member States (Article 107(1) TFEU). However, State aid, which contributes to certain well-defined objectives without unduly distorting competition between undertakings and trade between Member States, may be considered compatible with the internal market (for example under Article 107(3) TFEU). The objectives of the Commission’s control of State aid are to ensure that aid is growth-enhancing, efficient and effective, and better targeted in times of budgetary constraints, that aid does not restrict competition but addresses market failures for the benefit of society as a whole. In addition to this, the Commission acts to prevent and recover State aid which is incompatible with the internal market. The Commission enforces State aid rules to ensure that the support Member State governments grant to companies does not give them an unfair advantage in the Single Market. In 2021, State aid policy continued to play an important role in the crisis response to stabilise the economy and preparing for the path to exit the crisis. The Temporary Framework for State aid measures adopted at the beginning of the COVID-19 pandemic in 2020, and amended several times, set out the conditions the Commission applies to declare aid compatible. Well-targeted public support helped counter the damage inflicted on healthy undertakings and to preserve the continuity of economic activity. To prepare the exit from COVID-19 the crisis towards a sustainable and resilient recovery of the EU economy with focus on green and digital transition, DG Competition together with other Commission services assisted Member States in preparing their Recovery and Resilience Plans (RRPs). However, in 2021 Commission’s activity was not limited to crisis response and recovery. The extensive review of the State aid rules and enforcement work continued across all sectors.

With the aim of improving the interplay between EU funding rules and EU State aid rules under the new Multiannual Financial Framework, in July 2021 the Commission adopted an extension of the scope of the General Block Exemption Regulation (GBER), which streamlined the State aid rules applicable to national funding that fall within the scope of certain recently adopted EU programmes. In 2021, the Commission adopted revised EU Guidelines on Regional Aid, a revised Communication on short-term export credit insurance (STEC Communication) , the Risk Finance Guidelines, the Communication on State aid rules for Important Projects of Common European Interest (‘IPCEI Communication'), endorsed the Guidelines for State aid for climate, environmental protection and energy (‘CEEAG'), which were formally adopted in January 2022 , and submitted draft Broadband Guidelines for consultation. The review of the sector specific rules and guidance is elaborated further in the the second part of the Staff Working Document in the sectoral overview below. 3.1. Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak On 19 March 2020, the Commission adopted a Temporary Framework for State aid measures to enable Member States to use the full flexibility foreseen under State aid rules to support the economy . The Temporary Framework for State aid measures, which was initially established with an expiry date of 31 December 2020, provides a number of aid measures that the Commission considers compatible under Article 107(3)(b) and Article 107(3)(c) TFEU, such as limited amount of aid, selective tax advantages and State guarantees for loans. The aim of the Temporary Framework for State aid measures is to allow Member States to tackle the difficulties undertakings are currently encountering whilst maintaining the integrity of the EU internal market and ensuring a free and fair competition. The Temporary Framework for State aid measures includes certain requirements related to the green and digital transformation. Large undertakings that have received recapitalisation aid need to report on how the aid received supports their activities in line with EU targets and national obligations related to green and digital transformation, including the EU’s 2050 climate neutrality objective. Furthermore, on the basis of Article 107(2)(b) TFEU, Member States can also compensate undertakings that have suffered damage directly caused by the COVID-19 pandemic (for example in the sectors of transport, tourism, culture, hospitality and retail). Member States can notify such damage compensation measures and the Commission will assess them directly under Article 107(2)(b) TFEU. 3.1.1. The Temporary Framework for State aid measures: expansion and prolongation Since its adoption, the Temporary Framework for State aid measures has been amended four times in 2020, and twice in 2021, in order to support those sectors of the economy that were most vulnerable to the rules applied in the Member States as a consequence of the pandemic. On 28 January 2021, the Commission prolonged the availability of all measures set out in the Temporary Framework for State aid measures, including recapitalisation measures, until 31 December 2021, and expanded the scope of the Temporary Framework for State aid measures by increasing the ceilings set out for certain measures and allowing the conversion of certain repayable instruments into direct grants until the end of 2021 . On 18 November 2021, the Commission has decided to prolong the Temporary Framework for State aid measures until 30 June 2022, while setting out a path for the progressive phase-out of crisis measures . In order to further support the recovery from the pandemic, the Commission has also decided to introduce two new categories of measures to create direct incentives for future-oriented private investment and solvency support measures, for an additional limited period. 3.1.2. Measures authorised in the context of the COVID-19 pandemic During 2020-2021, the Commission had taken more than 1180 decisions (among them slightly more than 470 amendment decisions) in all Member States, including those under the Temporary Framework for State aid measures. State support totalling EUR 3.13 trillion to companies affected by the COVID-19 pandemic was assessed. There are a number of important caveats for some measures under the Temporary Framework for State aid measures, for which it is not necessary to indicate an amount. Therefore, the amounts included are best estimates based on amounts approved in State aid decisions and other available statistics, for example, mentioned in public communications by national authorities, and in official information communicated by the national authorities. All State aid approved was considered necessary and proportionate to support businesses and remedy the serious disturbance to the European economy due to the COVID-19 pandemic. At the same time, there were major differences in the amounts approved across Member States, which appears linked to the fiscal space they have as well as the respective size of their economies. More specifically, 51.7% of State aid approved has been notified by Germany. Italy has notified measures that represent around 15.5% of the entire amount of State aid, while the aid notified by France represents 14.5% of this amount. The aid notified by Spain represents 5.5% of the entire amount of State aid approved, while the aid notified by Poland and Belgium corresponds to around 2.3% and 1.9%, respectively. Aid notified by other Member States is estimated to be between 0.04% and 1.5% of the total EUR 3.13 trillion estimated. Based on the replies of 26 Member States that responded to the survey, in the period until end of June 2021, of the EUR 3.01 trillion in aid approved by then, around EUR 729 billion was actually used, representing about 5.4% of EU GDP 2019. The nominal amounts actually provided vary widely across Member States. In absolute terms, according to the data sent by Member States, France has granted more than a fourth of the total aid provided (EUR 188 billion), followed by Italy with 23% (EUR 169 billion), Germany with 19% (EUR 136 billion) and Spain with 14% (EUR 105 billion). In relative terms, Italy has increased the speed of spending in the first half of 2021 becoming the country that has provided to the economy the most as compared to its own GDP (9.4%), followed by Spain (8.4%). France (7.7%), Hungary (6.7%), and Greece (6.1%). Member States that were most affected by the first wave of the pandemic show a general slowdown in the disbursement of funds from December 2020 to June 2021 (France, Germany, the Netherlands and Denmark), with the exception of Italy and Spain that have largely increased their spending in the first half of 2021. The other large increases of COVID-19 related State aid expenditure in 2021 took place in the Member States most hit by later waves (Hungary, Slovenia, Latvia, Czechia, Slovakia, Lithuania and Cyprus). This emerging picture shows that State aid measures actually implemented by Member States are not disproportionate to the economic damage suffered during the crisis. This is reassuring as it addresses potential concerns as regards the level playing field. 3.2. Facilitating the exit from the pandemic – Recovery and Resilience Facility (RRF) The Recovery and Resilience Facility (RRF) programme entered into force on 19 February 2021. It finances reforms and investments in Member States from the start of the pandemic in February 2020 until 31 December 2026. The Commission supports the implementation of the first pillar of the Next Generation EU, the RRF. With funding of EUR 672.5 billion, RRF represents by far the largest part of the NextGenerationEU recovery package of over EUR 800 billion. The RRF supports public investments and reforms in the Member States, helping them to address the economic and social impact of the COVID-19 pandemic as well as to facilitate the green and digital transitions. To receive grants and low-interest loans under the RRF, Member States have submitted Recovery and Resilience Plans (RRPs) for the Commission’s assessment before disbursement of any funds. State aid control accompanies and facilitates the implementation of the RRPs to ensure that supported investment and reform projects are compatible with State aid rules. Member States will notify to the Commission measures that may entail State aid, and that do not fall under one of the existing General Block Exemption Regulations (GBER, ABER, FIBER) or under an existing authorized scheme. To that end, DG Competition published a Practical guidance to Member States for a swift treatment of State aid notifications in the RRF framework and will continue to provide guidance and templates to the Member States. 3.3. State aid for horizontal objectives

Over the years, the architecture of State aid control has evolved. Today, a substantial part of aid is granted under block-exempted schemes which are not examined by the Commission before entering into force. State aid for horizontal objectives generally accounts for the overwhelming majority of all aid. Already now, the General Block Exemption Regulations (GBER, ABER, FIBER) allow Member States to implement a wide range of public support measures in areas such as research and development, environmental protection, broadband connectivity, regional development or support to SMEs with prior notification if certain conditions are fulfilled. As illustrated by the graphs below, much of horizontal aid falls under the GBER. GBER State aid expenditure by objective in the EU, excluding aid for agriculture, fisheries and railways State aid decisions 2012-2021 3.3.1. State aid for climate, environmental protection and energy In December 2021, the Commission endorsed the new Guidelines on State aid for climate, environmental protection and energy 2022 (CEEAG), replacing the Guidelines on State aid for environmental protection and energy 2014-2020 (2014 EEAG). The guidelines, which entered into force upon their adoption on 27 January 2022, follow the announcement of the European Green Deal and adoption of the European Climate law . The CEEAG create a flexible, fit-for-purpose enabling framework to help Member States provide the necessary support to achieve the European Green Deal objectives in a targeted and cost-effective manner. Further details can be found in Section II 1.1 below. 3.3.2. State aid for research, development and innovation To achieve the greatest possible impact with available budgets, State aid for research, development and innovation (RDI) should not replace or crowd out private financing. To the contrary, public funding should leverage more private investments. RDI aid can help where market forces alone do not deliver the necessary investments in promising but high-risk innovative projects. In 2021, the Commission continued to ensure that aid schemes and individual measures notified or pre-notified under the RDI State aid rules were well targeted to projects enabling ground-breaking research and innovation. The Commission’s State aid control in the field of RDI covered a variety of sectors including novel technologies for the decarbonisation of industrial production processes, for electric and connected mobility, for digital solutions in process innovations, as well as research and technology infrastructures, innovation clusters and high power computing, with a focus on support for the development of new clean and digital technologies supporting Europe’s green and digital transition. Following the State Aid Modernisation in 2014, total RDI State aid expenditure under the GBER as well as the RDI Framework rose from EUR 8.9 billion in 2014 to almost EUR 14 billion in 2019, with EUR 12.8 billion disbursed under the GBER alone. The GBER was amended in 2021 to introduce provisions to facilitate and simplify State aid assessments for RDI projects by combining funding from the Horizon Europe programme with national funds. Following the fitness check, the Commission continued work on revising the State aid rules for RDI. The objective is to ensure that the revised State aid rules for RDI are fit for purpose taking into account the market and technological evolution as well as the specific objectives of the twin transition to a green and digital economy as well as the EU research and innovation policy. 3.3.3. Aid enabling Member States jointly to support important projects of common European interest

Until the end of 2021, the Commission assessed proposed State aid for the execution of Important Projects of Common European Interest (IPCEI) based on the compatibility criteria set out in a dedicated Communication adopted in 2014. In order to be deemed compatible under these rules, eligible projects must address an important market failure or other important systemic failures and (i) significantly contribute to strategic EU objectives; (ii) involve several Member States; (iii) involve private financing by the beneficiaries; (iv) generate positive spill over effects across the EU and (v) limit distortions to competition. In January 2021, in line with the Commission’s battery alliance initiative , the second set of batteries IPCEI, for developing innovative technologies for e-mobility and storage, jointly notified by 12 Member States, was approved by the Commission . In addition, in line with the updated Industrial Strategy Communication, discussions with Member States and industry on possible new IPCEIs in the areas of hydrogen technologies and systems, cloud infrastructure and services, microelectronics & connectivity and health have intensified in 2021. Concrete projects for two hydrogen IPCEIs (technology and industry) emerged in the second half of 2021, and just before the end of the year, a number of projects that will form part of an eventual new IPCEI in microelectronics and connectivity emerged as well. Not all of these projects have been notified to the Commission yet, but in all the areas mentioned above IPCEI are expected to emerge in the course of 2022. These can contribute to increasing the resilience of the EU and addressing strategic dependencies. In 2021, the Commission finalised the revision of the IPCEI Communication following the fitness check of the State aid package. The new revised IPCEI Communication was adopted by the Commission in November 2021 and will apply from January 2022 . The revised IPCEI Communication requires that at least four Member States participate, further incentivises and encourages the participation of SMEs in IPCEIs, clarifies the notion of first industrial deployment and introduces the ‘do no significant harm’ principle into the assessment framework. It states that IPCEIs can contribute to sustainable economic growth, jobs, competitiveness and resilience for industry and the economy in the Union and strengthen its open strategic autonomy. 3.3.4. Regional aid In April 2021, the Commission adopted revised Regional Aid Guidelines that entered into force on 1 January 2022 . It is for the Member States to notify their future regional aid maps, which are subject to individual decisions by the Commission. By 31 December 2021, the Commission had adopted a new regional aid map for almost half of the Member States. The Regional Aid Guidelines were the first set of State aid rules to be revised following the announcement of the European Green Deal and the European Industrial and Digital Strategies. The revised rules include a number of targeted adjustments to simplify and reflect experience gained from the application of the previous rules, as well as to take into account those new policy priorities. In 2021, the Commission also adopted several regional aid decisions authorising regional investment aid for SKBM’s investment project for a new battery cell plant in Hungary and also approving the one-year extension of two operating aid schemes in outermost regions . The Commission has further approved the prolongation of the French fiscal aid scheme to support productive investments in the French outermost regions until 2027 , and the extension of a scheme supporting social housing in Saint Martin until 2025. The Commission also approved a plan to evaluate a large block exempted Greek scheme . 3.3.5. Aid for financial institutions In 2021, the Commission authorised the prolongation of existing schemes for banks to continue supporting the resilience of the sector, without the need of granting new aid to individual financial institutions. In particular, the Commission authorised the prolongation of schemes for the restructuring or orderly market exit of entities in distress, in Poland , Ireland and Denmark , and for addressing potential liquidity challenges for banks in Greece . In addition, the Commission allowed the prolongation of guarantee schemes for the securitisation of non-performing loans (NPLs) in Greece (“Hercules” ) and Italy (“GACS” ), continuing to help banks clean up their balance sheets without granting aid or distorting competition. During the year, the Commission authorised indirect aid to financial institutions in schemes primarily targeted at providing social support to vulnerable households at risk of losing their home in Cyprus and Greece . In addition, the Commission authorised Member States to support young small and medium-sized enterprises (SMEs) and start-ups typically suffering from limited access to finance. In this respect, the Commission approved a modification of the existing risk finance scheme in France . It approved a pricing methodology for market-conform guarantees to be provided by Banco Português de Fomento, a Portuguese development bank , and a EUR 11.2 million capital increase for the Fund Manager of Financial Instruments in Bulgaria (FMFIB) , which manages the financial instruments co-financed by the European Structural and Investment Funds. Finally, the Commission updated some State aid rules related to financial instruments, in line with the Commission’s current policy priorities, in particular the General Block Exemption Regulation (GBER), the Short-Term Export Credit (STEC) Communication and the Risk Finance Guidelines (RFG). 3.3.6. Aid supporting fixed and mobile broadband deployment and take-up The number of measures concerning support to the deployment of mobile networks continued to increase in 2021, with the adoption of a EUR 2.1 billion federal German scheme, a regional mobile scheme in Lower-Saxony, a Spanish scheme to support the deployment of passive infrastructure for the provision of mobile communication services in areas without 4G mobile coverage and a Galician measure supporting rural mobile deployment. The Commission also approved several decisions concerning fixed broadband, notably a Spanish measure roll out networks providing at least 300 Mbps symmetrical speeds, upgradeable to 1 Gbps symmetrical, in areas with no more than one next generation access network and where available download connectivity was below 100 Mbps. The Commission also adopted the prolongation of a Croatian scheme for the development of NGA networks. The Commission also approved a EUR 610 million Italian voucher scheme to facilitate the access of SMEs to high-speed broadband services, as well as a measure supporting the connection of Italian schools. 3.3.7. Aid strengthening the resilience of the EU semiconductors ecosystem The State aid rules also provide a number of possibilities to strengthen the resilience of the EU semiconductors ecosystem. In its Communication on a Competition Policy fit for new challenges of 18 November 2021, the Commission identified the global semiconductor shortage and the EU’s dependency on supply from a limited number of companies in a changing geopolitical context as a challenge for the Union. Against this specific background, the Communication specified that it may envisage approving support to fill potential funding gaps for the establishment in particular of European “first-of-a-kind” facilities in the semiconductor ecosystem based on Article 107(3)(c) TFEU. This legal basis allows the Commission to approve aid to facilitate the development of certain economic activities or of certain economic areas to be compatible with State aid rules, where it does not adversely affect trading conditions to an extent contrary to the common interest. In order to make sure that the overall belance of effects of such aid is positive, aid will be subject to strong competition safeguards as well as ensuring that benefits are shared widely and without discrimination across the European economy. On 8 February 2022, the Commission further clarified relevant concepts in its Communication on a Chips Act for Europe . 3.3.8. Infrastructure support measures The Commission approved several support measures for infrastructure projects. In January 2021, the Commission approved Greek public funding for the construction and operation of the North section of the E65 Motorway . In March 2021, the Commission approved State aid for the reconstruction of Parc Exposition Hall 3 Le Bourget in Paris, in the context of the 2024 Olympic and Paralympic Games . In July 2021, the Commission approved State aid for the construction of a carbon capture and utilisation facility in Hengelo (Netherlands) . In December 2021, the Commission approved the amendment of a German measure to encourage the shift from road to railway in the Land of Saxony-Anhalt . 3.3.9. Evaluation of aid schemes by Member States The State Aid Modernisation (SAM) introduced the requirement for Member States to evaluate certain aid schemes. The aim is to gather the necessary evidence to better identify the impact, positive and negative, of the State aid and to provide input for future policy-making by the Member States and the Commission. Since 1 July 2014, evaluation is required for large GBER schemes in certain aid categories as well as for a selection of notified schemes under the new generation of State aid guidelines .

By the end of 2021, the Commission had approved evaluation plans covering 76 State aid schemes. Twelve additional schemes are currently under analysis, covering a total of 17 Member States and the United Kingdom. Most of these decisions concerned either large regional aid projects or Research, Development and Innovation (RDI) aid schemes under GBER or notified energy and broadband schemes. In total, these schemes account for over EUR 62 billion in annual State aid budget. By the end of 2021, the Member States had delivered to the Commission 27 interim and 33 final evaluation reports. They were assessed by the Commission services and considered to be of average to good quality . In 2021, the Commission proposed a partial restructuring of the evaluation requirement, which would take into account the experience gained in previous years as well as the 2020 fitness check and fact-finding study. The revised version of the evaluation requirement features already in the newly approved guidelines on Regional aid, Risk Finance and ETS. Due to the COVID-19 pandemic, in 2021 the Commission did not organise any workshop with Member State representatives and evaluation experts as in previous years. The Commission expects to resume the annual meetings in 2022. The current priority of the Commission is to comprehensively assess evaluation reports, both intermediate and final ones, in order to: (i.) give appropriate feedback to Member States, (ii.) make sure that results are used for better policy-making, and (iii.) provide evidence to assist Member States when reflecting on future legal developments. 1.4. Strengthening the Commission toolbox – a new policy initiative redressing distortive foreign subsidies In May 2021, the European Commission adopted a proposal for a Regulation on foreign subsidies distorting the internal market , accompanied by an Impact Assessment report . The legislative proposal follows the publication of a White Paper in June 2020 and an extensive consultation process with stakeholders. The proposal aims at closing a regulatory gap. Subsidies granted by third countries currently go largely unchecked, while aid granted by EU Member States is subject to EU State aid rules. The proposed new tool is designed to tackle foreign subsidies that cause distortions and harm competition in the internal market. The proposed Regulation will allow the Commission to investigate foreign subsidies and redress their distortive effects in any market situation, but with a specific focus on concentrations and public procurement procedures. The proposal includes three tools: i.) proposed concentrations where the target company has an EU turnover of at least EUR 500 million and the foreign financial contribution exceeds EUR 50 million, would have to be notified to the Commission; ii.) bids in EU public procurement procedures involving foreign financial contributions where the value of the procurement is at least EUR 250 million would have to be notified to the Commission; and iii.) the Commission would be empowered to investigate ex-officio other market situations, including smaller concentrations and smaller public procurement procedures. The Commission would have exclusive competence to enforce the Regulation. When the negative effects of the foreign subsidy outweigh its positive effects, the Commission will have the power to impose redressive measures or accept commitments to remedy the distortion. Such measures and commitments include a range of structural or behavioural remedies, such as the divestment of certain assets or the prohibition of a certain market behaviour. The Commission will also have the power to prohibit a subsidised concentration or the award of a public procurement contract to a subsidised bidder. The Commission’s proposal is subject to the ordinary legislative procedure by the co-legislators, the Council and in Parliament. 3.5. Monitoring, recovery and cooperation with national courts 3.5.1 Increased monitoring of existing State aid to ensure competition on fair and equal terms Pursuant to the most recent figures available , 95.5% of the new State aid measures implemented in 2020 are covered by GBER and, among all the State aid measures active in the same year, 86.1% are GBER measures. These figures show that it is essential for the Commission to verify that Member States apply State aid schemes correctly and that they only grant aid when all required conditions are met. Therefore, monitoring is the counterweight to ‘self-assessment’ by Member States resulting from the exemption from the notification obligation (for example the GBER) and also a necessary complement of the approval of State aid schemes by the Commission. 3.5.2 Restoring competition by recovering of State aid granted in breach of the rules To ensure the integrity of the internal market, Member States must take all necessary measures to recover unlawful and incompatible aid. The purpose of recovery is to restore the situation that existed on the internal market prior to the granting of the aid. This is necessary to ensure that competition in the Single Market can take place on fair and equal terms. In 2021 the Commission continued its efforts to ensure that recovery decisions are enforced effectively and immediately. The Commission adopted five new recovery decisions, totaling an estimated EUR 1.2 billion to be recovered by the Member States concerned . As of the end of December, the Commission had 53 recovery cases pending . By 31 December 2021, the sum of unlawful and incompatible aid recovered from beneficiaries amounted to EUR 29.4 billion . At the same point in time, the outstanding amount pending recovery was EUR 7.6 billion. Recovery decisions adopted in 2021 5 Pending recovery cases on 31 December 2021 53 In 2021, the Commission decided to launch one court action under Article 108(2) TFEU for failure to implement the recovery order in SA.34914 , but decided to repeal its decision following the confirmation by the United Kingdom that it had fully recovered the illegal State aid. 3.5.3. Cooperation with national courts to ensure the effectiveness of State aid rules The Commission continued its cooperation with national courts under Article 29 of the Procedural Regulation . This includes direct case-related assistance to national courts when they apply EU State aid law. National courts and tribunals can ask the Commission to provide case related information, or to provide an opinion on the application of State aid rules. The Commission may also submit amicus curiae observations on its own initiative.

While the Commission received no requests for information in 2021, it received two requests for legal opinions from courts in Latvia and Austria. The first request from the Supreme Administrative Court Senate in Riga concerned the calculation of overcompensation in the financing of renewable energy plants. In 2021 the Commission continued to intervene in national proceedings as amicus curiae . To make its views publicly known, the Commission publishes its opinions and amicus curiae observations, as well as observations to other bodies, for example. arbitration tribunals, on its website . In July 2021, the Commission adopted a new Notice on the Enforcement of State aid rules by national courts and it replaces the 2009 Enforcement Notice , providing updated practical guidance on the enforcement of State aid rules at national level and on the cooperation tools under Article 29 of the Procedural Regulation. 3.6. Significant judgements by the European Union Courts in the State aid area In 2021, the Union Courts adopted a number of important State aid judgements. The following overview is based on a selection of court judgements, in particular on issues related to the distinction between State aid schemes and individual aid, the notion of selectivity, the compatibility of State aid schemes adopted in response to the COVID-19 outbreak and several procedural points. Aid scheme and individual aid In its judgement Commission v. Belgium and Magnetrol International , the CJEU provided clarifications of the notion of an aid scheme. In particular, the Court confirmed that the existence of an aid scheme can be based on a consistent administrative practice; this is possible even if this practice coexists with legal acts that are systematically misapplied by Member States. This allows the Commission to go beyond the wording of the legal acts and determine the real scope of the aid scheme in question in order to ensure the effectiveness of State aid control. The notions of existing and new aid In C-128/19 Azienda Sanitaria Provinciale di Catania, the CJEU clarified the notions of existing and new aid. It confirmed that changes such as a prolongation and budget increase to an authorised aid scheme cannot be regarded as being purely formal or administrative in nature. On the contrary, they constitute an alteration to existing aid within the meaning of Article 1(c) of Regulation No 659/1999. Such new aid must be notified, unless it meets the conditions of the de minimis regulation or the block exemption regulation. Advantage In C-890/19 P Fortischem a.s. v Commission, the CJEU recalled that the application to an undertaking of rules derogating from the normal insolvency rules gives rise to State aid in certain circumstances. In C-362/19 P Fútbol Club Barcelona v Commission, the CJEU confirmed that the examination the Commission must carry out relates exclusively to the scheme in question (ex ante analysis) and not to the aid subsequently granted on the basis of it. In Joined Cases T-516/18 and T-525/18 Luxembourg and Engie v Commission, the General Court held inter alia that the tax rulings were issued in derogation from the national rules on “abuse of law”, so they granted a “selective advantage” to Engie. In Joined Cases T-816/17 and T-318/18 Luxembourg and Amazon v Commission, the General Court annulled the Commission’s primary and alternative findings on an advantage in the context of prices for an IP licence paid between the entities of the group. The General Court considered in particular that the Commission had erred in its functional analysis and finding that a group company was merely a passive holder of the intangible assets in question. The Commission did not take due account of the functions performed by that company for the purposes of exploiting the intangible assets in question or the risks borne by that company in that context. The case is under appeal by the Commission. As regards the application of the Market Economy Operator Principle, in C-933/19 P Autostrada Wielkopolska S.A. v Commission, the novelty was that the conduct of the State was compared with that of a “private debtor”, an approach relevant to situations where the State owes money to an undertaking. The CJEU explained that unlike the situations where investors, operators, vendors or creditors seek to maximise respectively the return, fees, sale revenue or recovered assets, a private debtor seeks to minimise the money it has to pay. Economic continuity In C-890/19 P Fortischem a.s. v Commission, the CJEU confirmed that the transfer price is only one of the factors to be taken into consideration. If it is not clear whether the transaction took place at market price, the Commission is not obliged to take a definitive position on that point. Selectivity In a series of judgements delivered on 6 October 2021 on the selectivity of a fiscal measure, the CJEU dismissed the appeals against earlier judgements of the General Court, upholding the negative decisions of the Commission adopted in 2011 concerning a Spanish measure allowing the amortisation of financial goodwill for the acquisition of foreign shares. The judgments provide important perspectives for assessing the selectivity of fiscal measures, in particular for determining the reference framework, which is necessary for the determination of selectivity of fiscal measures. On 16 March 2021, in Cases C-562/19 P Commission v Poland and C-596/19 P Commission v Hungary, the CJEU upheld the judgements of the General Court from May and June 2019, which had annulled the Commission decisions of 2016 and 2017 in cases SA.44351 (Polish tax on retail sector with progressive rates) and SA.39235 (Hungarian advertisement tax with progressive tax rates) on the grounds that, in the assessment of selectivity, the Commission incorrectly identified the reference tax system. The Court found that, outside the spheres in which EU tax law has been harmonised, the determination of the characteristics constituting each tax falls within the discretion of the Member States, in accordance with their fiscal autonomy. This includes, in particular, the choice of tax rate, which may be proportional or progressive, and also the determination of the basis of assessment and the taxable event. Those characteristics constituting the tax therefore, in principle, define the reference system or the ‘normal’ tax regime, from which it is necessary to analyse selectivity. In addition, the Court noted that EU law does not preclude progressive taxation from being based on turnover as it constitutes, in general, a relevant indicator of the taxable person’s ability to pay. Accordingly, the characteristics constituting the tax, which include progressive tax rates, form, in principle, the reference system or the ‘normal’ tax regime. Further, the Court considered that the Gibraltar case-law (Commission and Spain v Government of Gibraltar and United Kingdom (C‑106/09 P and C‑107/09 P)) does not contradict the above finding, because the Commission had not established that the progressivity of the rates was designed in a manifestly discriminatory manner, with the aim of circumventing the requirements of EU law on State aid.

Legality of schemes adopted in response to the COVID-19 pandemic In 2021, a novel type of litigation related to various types of aid during the COVID-19 pandemic emerged. The most frequent issues in this type of actions - initiated mainly by Ryanair - related to the application and conditions of Article 107(2)(b) TFEU as well as Article 107(3)(b) TFEU. The General Court also rejected the claims about an infringement of the principle of non-discrimination and the freedom to provide services. Out of the ten judgments rendered so far at first instance, the Commission decisions were annulled in three instances, all for the breach of the duty to state reasons. In its judgement of 17 February 2021, Ryanair v Commission , the General Court dismissed Ryanair’s action against the Commission’s decision not to raise objections concerning State aid by Sweden to airlines operating in Sweden. As regards the allegation that the aid was discriminatory, the General Court noted that the aid scheme fulfilled the conditions laid down in Article 107(3)(b) TFEU. The General Court also considered that limiting eligibility for the aid only to those airlines holding a Swedish operating licence, in view of the stable and reciprocal links between them and the Swedish economy, was appropriate to achieve the objective of remedying the serious disturbance in the Swedish economy. In another judgement of 17 February 2021, Ryanair v Commission , the General Court dismissed Ryanair’s action against the Commission’s decision not to raise objections concerning aid by France to airlines operating in France (moratorium on the collection of civil aviation tax and the solidarity tax ordinarily imposed by the French State). The General Court confirmed that the COVID-19 pandemic as well as the restrictions and lockdown measures adopted by France to deal with its consequences, constituted an exceptional occurrence within the meaning of Article 107(2)(b) TFEU, which caused economic damage to the airlines operating in France. The General Court considered that the purpose of the deferral of the payment of the taxes had the objective to repair the damage in question. Procedural issues In its judgement of 22 September 2021, DEI v Commission , the General Court annulled the decisions by which the Commission came to the conclusion that an arbitration award setting an allegedly preferential tariff for electricity did not involve an advantage to an aluminium producer. In this judgement, the General Court clarified the concept of complainant as an ‘interested party’ with standing to bring an action against a decision. In addition, the General Court considered that the Commission should have made a diligent, sufficient and comprehensive assessment, by carrying out economic and technical analysis, to determine whether the electricity tariff complied with the market conditions. In its judgement of 2 September 2021, Commission v Tempus energy and Tempus Energy Technology , the CJEU set aside the earlier judgment of the General Court and upheld the Commission’s decision on the UK capacity market (security of supply mechanism in the United Kingdom in the field of electricity). The judgement confirmed that the Commission correctly applied Article 108 TFEU when it decided not to raise objections against the aid without a formal investigation. In particular, the CJEU clarified that the length of contacts between the Commission and the Member States, the complexity of a measure, the high budget of a measure or the existence of spontaneous observations from third parties did not in themselves entail that the Commission had serious difficulties to determine that the aid was compatible. The CJEU also confirmed that the Commission is not obliged to seek all information which might be connected with the case before it, even where such information is in the public domain. In C-933/19 P Autostrada Wielkopolska S.A. v Commission, the CJEU recalled that interested parties cannot themselves seek to engage in an adversarial debate with the Commission in the same way as a Member State. Although during the administrative procedure new guidelines entered into force, the CJEU concluded that the facts of the case had not changed so as to merit a second round of contacts between the Commission and the beneficiary. The Commission was not obliged to grant interested parties the opportunity to comment on the observations of the Member State.



4.Developing the international dimension of EU competition policy 1.5. Multilateral relations In 2021, the Commission continued its active engagement in international competition-related fora such as the OECD Competition Committee, the International Competition Network (ICN), and United Nations Conference on Trade and Development (UNCTAD). At the OECD Competition Committee meeting in June 2021, the Commission contributed to the discussions on competition enforcement and regulatory alternatives, competition compliance programmes, the concept of potential competition and methodologies to measure market competition. In December 2021, the Commission contributed to the Competition Committee’s deliberations on the environmental considerations in competition enforcement and the promotion of competitive neutrality by competition authorities. As co-chair role of the ICN Unilateral Conduct Working Group, the Commission continued the multi-annual project on the “assessment of dominance and market power in digital markets”. The Commission contributed to various work products of the Cartel Working Group, in particular “Guidance on Enhancing Cross-border Leniency Cooperation”, “Crisis Cartels and Horizontal Cooperation in the time of COVID-19”, and the “Big Data and Cartels Project”. In July 2021, the Commission participated in the 19th meeting of the UNCTAD Intergovernmental Group of Experts on Competition Law and Policy. The session on Competition Law, Policy and Regulation in the Digital Era focused on the challenges that competition authorities face in digital markets. In November 2021, the Commission participated in the Ad Hoc Working Group on Cross Border Cartels. The Commission emphasized the trusted principles developed within the ECN with regard to cooperation and prosecution of cartels. Moreover, in December 2021, the Commission also participated to the UNCTAD Global Policy Dialogue focusing on small and medium sized enterprises and Competition Policy in the wake of the post COVID-19 pandemic. Finally, the Commission continued its endeavours to improve international rules for subsidies. Reforming the subsidy rules is one of the EU’s main priorities for the modernisation of WTO trade rules, as confirmed in the joint statement of the EU, US and Japan. To this effect, in 2021 the Commission was engaged in sectoral initiatives addressing subsidies in the international context, such as the G20 Global Forum on steel excess capacity. 1.6. Bilateral relations In December 2021, the Commission and the US competition authorities launched the EU-US Joint Technology Competition Policy Dialogue to develop common approaches and strengthen the cooperation on competition policy and enforcement in the tech sectors. With regard to the Korean and Japanese Fair Trade Commissions there was close bilateral cooperation under the respective cooperation agreements . DG Competition's multilateral technical cooperation with the Chinese, Japanese, Korean, Indian and ASEAN competition authorities continued . The Commission continued its cooperation in competition policy and in case review with China's State Administration for Market Regulation (SAMR) under the 2019 cooperation documents. The Commission aims to include provisions on competition and State aid control when negotiating Free Trade Agreements (FTAs). In 2021, the Commission continued FTA negotiations with Australia, Azerbaijan, Chile, Indonesia, New Zealand and Uzbekistan. As regards the draft Second Generation Cooperation Agreement between the EU and Canada, the Commission is in regular contact with the Canadian Competition Bureau to find a solution on data protection in Canada lining up to the standards established by the Opinion of the Court of Justice on the 2014 EU Canada Passenger Name Record Agreement. Moreover, the Commission continued the negotiations with Japan on a Second Generation Agreement with a view to updating the existing cooperation agreement from 2003.

With regard the candidate and potential candidate countries, the Commission's main policy objective is to help these countries to create legislative frameworks with well-functioning operationally independent competition authorities that build up a solid enforcement record. In 2021, the Commission continued to monitor candidate countries’ compliance with their commitments under the Stabilisation and Association agreements. In addition, the Commission continued monitoring the implementation of the competition acquis in neighbouring countries, with which the EU has concluded deep and comprehensive free trade agreements. The Commission has also been actively engaging with several African national and regional authorities to develop cooperation in the competition field. In 2021, the Commission hosted joint workshops with the South African Competition Commission on digital aspects of competition law and inter-agency cooperation. In 2022, the Commission will organise Africa-EU Competition Weeks for the first time to foster dialogue with African competition authorities at the national and regional level.

5. Supporting EU competition law enforcement 5.1. Digital transformation The Commission recognises digital transformation as a major political priority for its current mandate (Europe Fit for the Digital Age), not only for driving change in markets but also for enabling public sector modernisation. The implementation of DG Competition’s Digital Strategy to further digitise business processes, modernise digital solutions and to transform it into a more data-driven organisation to support EU competition policy enforcement continued throughout 2021 in alignment with the Commission’s Digital Strategy . In addition, DG Competition updated and continued to implement its IT security action plan to further improve cybersecurity of its information systems, their security plans and staff’s cyber skills and awareness, this in collaboration with DG DIGIT. 5.1.1 Case management modernisation In 2021, a new corporate case management platform - CASE@EC – has been rolled out for State aid case management as well as document registration and document management processes for all competition enforcement instruments. Work continued to prepare the implementation of CASE@EC for other areas, in particular case management in antitrust, cartel and merger cases. 5.1.2. Improving digital exchanges with Member States’ administrations, companies and citizens During 2021, DG Competition continued improving its range of existing digital solutions to enhance and fully digitise communication and collaboration processes with its external stakeholders, in particular Member State administrations, National Competition Authorities, citizens and businesses as well as attorneys and law firms. This included for example a revamped tool for Member States to report State aid (SARI2) and a new solution digitizing the negotiation on confidentiality claims with parties and producing non-confidential versions of documents in the context of Access to File and preparation of decisions (eConfidentiality). DG Competition also launched a pilot for a new digital solution supporting requests for information in the context of market investigations (eRFI), and started a project to revamp the publication of competition cases’ data on the EUROPA website to help citizens and external stakeholders to better access, search and export public data on competition. 5.1.3. Advanced data support and digital solutions for competition investigations As DG Competition continues facing an exponential increase in the volume of electronic communications with parties as well as in electronic evidence, projects have started to improve the handling of large volumes of case related submissions as well as on premise access to files by parties concerned, developments for advanced data and machine learning services and solutions to support investigations. Moreover, DG Competition keeps investing into state-of–the-art, non-standard hardware and software solutions operated by specialised staff in the context of investigative and forensic IT activities, performed to better detect and effectively prosecute anticompetitive conduct. 5.2. Single Market Programme Adapting to an increasingly digital and fast-paced environment is a constant challenge for the enforcement of EU competition policy. New sophisticated digital tools and algorithms used by economic operators, combined with an exponential increase in electronic communications, the sheer quantity of data and the number of documents on case files render many competition investigations increasingly complex. DG Competition therefore identified digital transformation as a key priority for 2021 and concentrated efforts to put in place innovative and modernised digital solutions to make competition enforcement more effective by working on the implementation of its Digital Solutions Modernisation Plan. The Multiannual Financial Framework 2021-2027 also responds to these new challenges by including for the first time a dedicated Competition programme as part of the Single Market Programme with a budget dedicated to actions in support of competition policy and enforcement. With a budget of EUR 20.4 million for 2021, the Competition programme channels investment into areas that support effective and up-to-date enforcement of EU competition policy as well as policy actions, cooperation and partnerships with public administrations in the EU, global cooperation and partnerships with third country authorities, and helps raisi