Opinion of the European Economic and Social Committee on Regulating competition and consumer protection
Date: 2006-07-05
Institutions: European Economic and Social Committee
Subjects: competition law, competition policy, consumer protection, free competition

16.12.2006

EN

Official Journal of the European Union

C 309/1

II

(Preparatory Acts)

EUROPEAN ECONOMIC AND SOCIAL COMMITTEE

428TH PLENARY SESSION HELD ON 5 AND 6 JULY 2006

Opinion of the European Economic and Social Committee on Regulating competition and
consumer protection

(2006/C 309/01)

On 14 July 2005, the European Economic and Social Committee decided to draw up an opinion, under
Rule 29(2) of its Rules of Procedure, on: Regulating competition and consumer protection

The Section for the Single Market, Production and Consumption, which was responsible for preparing the
Committee's work on the subject, adopted its opinion on 31 May 2006. The rapporteur was Ms Sánchez
Miguel.

At its 428th plenary session held on 5 and 6 July 2006 (meeting of 5 July 2006), the European Economic
and Social Committee adopted the following opinion by 134 votes to none, with two abstentions.

1. Conclusions and recommendations

1.1
Free competition offers benefits to all market partici-
pants, especially consumers. Nevertheless, infringements of the
laws governing this area have had a major
impact on
competing businesses and the rules allow for sanctions to be
imposed, thus mitigating the economic impact of the lack of
competition between companies.

1.2
In the past consumers have not had at their disposal any
appropriate legal instruments based on competition law which
would help them to take action or seek redress for any loss
suffered in the market as a result of prohibited competitive
practices. Only following on from the major changes in the
internal market,
in particular the liberalisation of sectors of
general economic interest, has the debate opened on the need
for instruments that would enable consumers to play a part in
competition policy.

1.3
The first step in this direction was the appointment of a
Consumer Liaison Officer within DG Competition to mediate
between the DG and consumer organisations on competition-
related matters in which his opinion was relevant. Today, three
years later, his effectiveness has proved limited, owing to lack
of resources.

In the meantime,

1.4
restrictions on free competition have arisen,

in the main liberalised sectors, real
resulting in

competitors being excluded from the market and clearly
limiting consumers' economic rights. One of the reasons for
this negative impact is the national approach adopted by most
Member States with regard to liberalisation, with a trend
towards protection for national businesses. The Commission
should be given the necessary means to put a stop to such
practices.

Article 153(2) TEC provides the Commission with the
1.5
legal base for establishing a horizontal consumer protection
measure in all Community policies, and in competition policy
in particular, to ensure that the provisions of Articles 81 and
82 TEC cover
the interests of consumers as well as of
competing businesses affected by infringements of competition
rules. In turn, the Member States will be required to ensure that
their national laws also serve this purpose.

1.6 With this in mind, measures should be put in place
providing compensation for
especially to
any damages,
economic rights, caused by prohibited practices.

Systems for informing and consulting consumers must
1.7
also be strengthened.
If DG Competition retains its liaison
officer, he should be given the means necessary to perform his
duties, and DG SANCO must involve all the bodies with which

C 309/2

EN

Official Journal of the European Union

16.12.2006

it works, in order to have a greater impact on competition-
related matters directly affecting consumer interests.
In this
regard, we believe that the European Competition Network
could adapt its activities to incorporate any information and
observations that national or Community consumer organisa-
tions wish to provide in order to make competition policy
more efficient in the markets and to ensure that consumers'
economic rights are recognised.

2. European competition policy today

2.1
the
Free competition is a fundamental principle of
market economy, which is based on the idea that economic
players, and more generally all private individuals accessing the
market, have freedom of initiative. The need for rules combing
free competition in the market and the rights of all persons
involved in the market gave rise to the Treaty rules used to
regulate it. At the height of the liberalisations, the European
Commission stated the need (1) to strike a balance between the
interests of businesses and those of consumers, bearing in mind
new economic situations that had not been foreseen in compe-
tition law. It also stated its support for making voluntary instru-
ments workable and for promoting dialogue between consu-
mers and businesses in order to increase consumer confidence
in the market, because competition could not achieve this on
its own.

2.2
The current situation features some new aspects as set
out in the Commission report on competition policy 2004 (2)
and in the speech given by Commissioner Kroes (3). Both of
these highlight the need to focus action on those sectors that
are essential to the internal market and to competitiveness
under the terms of the Lisbon agenda and, most particularly,
taking account of consumers' interests, especially the effects of
cartels and monopolies on their rights. This approach can be
seen as a first step towards incorporating consumer protection
as a measure for regulating the market from the consumer's
point of view and not only from that of the supplier, which
has been the case to date.

2.3
It should be stated that competition policy must apply
to the EU as a whole, in cooperation with the Member States,
not only because it applies to the single market and conse-
transactions but also because its
quently to cross-border
purpose is to harmonise national
legislation so that protec-
tionist national policies are not implemented in order to favour
domestic markets, discriminating against competitors. The
Community authorities, especially the Commission, thus have a
crucial role to play. The Commission is not only responsible

(1) Consumer policy action plan: 1999-2001.
(2) SEC(2005) 805 final, 17.6.2005. EESC opinion: OJ C 110 of

9.5.2006, p. 8.

(3) London, 15 September 2005,
Consumer and Competition Day’.

at

the

conference

‘European

for drawing up legislative proposals to regulate competition,
but also for controlling mergers and state aid,
in which the
general interest must take precedence over each state's national
interest.

2.4
The liberalisation of sectors of general interest and the
regulation of financial services have led to attempts to establish
a link between competition policy and other Commission poli-
cies, in particular consumer policy. In fact, the latest Report on
Competition Policy (2004) states that one of the reasons for
applying this policy rigorously is to increase consumer interest
and confidence in the internal market.

2.5
Despite this declaration of principles, the analysis of the
different provisions setting out European competition policy
gives few practical details and indeed its position remains the
same as before. In 2003, on the European Day of Competi-
tion (4),
it was announced that a Consumer Liaison Officer
would be appointed within DG Competition, with the remit to
act in each of the areas covered by this policy,
in order to
watch over consumer interests.
Information leaflets are also
being published (5) to guide and inform consumers as to the
content of competition policy and how it could affect their
interests.

The tasks to be fulfilled by the Consumer Liaison

2.6
Officer (6) include the following:

— acting as a contact point for consumer organisations and

individual consumers (7);

— establishing regular contacts with these organisations and
in particular the European Consumer Consultative Group
(ECCG);

— alerting consumer groups to competition cases where their
input might be useful, and advising them on how they can
express their views;

— maintaining contacts with National Competition Authorities

(NCA) regarding consumer protection matters.

2.7
This trend in competition policy towards considering
consumer interests as well would have to be applied across the
board, thus putting an end to the clear-cut divisions between
the Directorates-General
for Competition and for Health &
Consumer Protection. There would have to be ongoing coordi-
nation between all policies, not only at European level, but also
between these and national policies,
in order to ensure free
market competition that benefits economic and social actors
and consumers too.

(4) Rome, 6 December 2003, Commissioner Monti announced the

appointment of Mr Rivière y Martí.

(5) EU competition policy and consumers: Publications Office, Luxem-

bourg.

(6) See XXXIII Report on Competition policy 2003 p. 6. et seq.
SEC(2004) 658 final, 4.6.2004. EESC opinion — OJ C 221,
8.9.2005.

(7) This can be done via e-mail at: comp-consumer-officer@cec.eu.int.

16.12.2006

EN

Official Journal of the European Union

C 309/3

3. EU competition policies that affect consumers

3.1
Competition policy could be said to have recently
undergone a major change, due not only to the widespread
occurrence of what is known as economic globalisation but
also to the much-needed reconciliation of service-sector liberali-
sation with other public service goals, such as ensuring the
pluralism and reliability of
these services.
Competition policy is committed to playing a key role in
implementing the aims of competitiveness as defined in the
Lisbon Agenda, which focus on the smooth operation of the
market economy and above all of economic mergers, which are
crucial to the success of the European economy, vis-à-vis our
international competitors, without any consequent
loss of
rights for European competitors and especially consumers.

the providers of

3.2
The need to define competition policy as it affects
consumers calls for a close look at the points regulating this
matter, in other words, those corresponding to the articles in
the Treaty and to its implementing regulations. Some of these
have recently been amended, whilst others are pending adop-
tion.

3.3 Restrictive agreements and practices

3.3.1
Agreements between undertakings are part and parcel
of market relations and help to ensure that markets operate as
they should, but these agreements are not always concluded for
competitive reasons. Often the opposite is true; and even when
the common market was created, there was discussion of the
need to ban such agreements, where these aim to prevent,
restrict or distort free competition. The same applies to associa-
tions of undertakings, which are most evident in cartels oper-
ating as business groupings, without any obvious coordination
between them. Where their activity restricts or prevents free
competition, it will be covered by the prohibition.

3.3.2
The legal basis of agreements and decisions between
undertakings is the contract, which imposes obligations on the
parties concerned. In both cases, their validity is conditional on
compliance with the relevant legal provisions. The issue under
consideration here is the effects of these agreements on third
parties and in particular on the rules governing competition in
the market.

3.3.3
The aim of the law is definitively to prohibit the end
result, which is restriction on competition but it goes beyond
this, since it declares all agreements or decisions void, with all
the practical consequences that this entails for compensation
for the harm done to competitors and to the economy in
general by the distortion of the way in which markets operate.

3.3.4
The complexity of the situations covered by the rules
set out in Article 81 of the Treaty, in national markets as well
led the Commission to
as in the European internal market,

is known as the ‘modernisation package’ (8)
draw up what
which helps to bring the Treaty's provisions into line with the
case-law of the courts and with the many situations which
have occurred in the course of its application.

Rules on block exemptions have also been updated (9).
3.3.5
This regulation presents new rules for exemptions in line with
current market needs, and in particular for exemptions of tech-
nological agreements. The need for clear legislation that will
make it easier to secure agreements between undertakings,
without falling foul of the prohibition, requires boundaries to
be set for cooperation between undertakings and must above
all ensure that consumers never suffer as a result of these
exemptions.

3.4 Abuse of a dominant position

3.4.1
Article 82 of the Treaty prohibits any abuse by one or
more undertakings of a dominant position within the common market
or in a substantial part of it. This provision does not prevent a
dominant position from occurring (in fact the trend has been
to encourage economic mergers that allow European undertak-
ings to compete with others throughout the world) but rather
aims to prevent the dominance acquired being used to impose
conditions on competitors, thus eliminating competition.
In
the provision contained in this article is not
this case,
concerned with the origin of this dominant situation, unlike
Article 81, which is interested in the origin of the agreement or
of the decisions, in order to be able to declare them void.

3.4.2
The effects of a dominant position are different to
those of collusive practices, since this does not appear to affect
competition, which may already be limited by an absence of
competitors or by the insignificant role of competitors in the
market. However,
intervention is necessary on behalf of the
consumer, whose interests will suffer as a result of the condi-
tions imposed by the dominant enterprise in question (10).

(8) Council Regulation (EC) No 1/2003 of 16 December 2002 on the
implementation of the rules on competition laid down in Articles
81 and 82 of the Treaty and later amended by Council Regulation
(EC) No 411/2004 (OJ L 68 of 6.3.2004); Commission Regulation
(EC) No 773/2004 of 7 April 2004 relating to the conduct of
proceedings by the Commission pursuant to Articles 81 and 82 of
the EC Treaty (OJ L 123, 27.4.2004, p. 18). Also published was a
series of communications and guidelines with a view to laying
down the procedures for relations between competition authorities
and the Commission and between the Commission and the judicial
authorities.

(9) Commission Regulation (EC) No 772/2004, 27 April 2004, on the
application of Article 81(3) of the Treaty to categories of technology
transfer agreements (OJ L 123, 27.4.2004, p. 11).

(10) The case-law of the ECJ has had to define the concept of a domi-
nant position because it is not defined in the Treaty and does so by
considering this to be an economic position held by one or more
undertakings, enabling them to prevent real competition in the
market, by acting independently of their competitors, customers
and consumers.

C 309/4

EN

Official Journal of the European Union

16.12.2006

3.4.3
Against this background, the Commission has been
taking action in the main sectors where, because the sectors
were liberalised only recently, companies enjoyed a dominant
position in most EU countries, such as the telecommunications
sector (11), or where, because major technological
innovation
was involved, companies faced no genuine competition, as in
the case of Microsoft (12). Both cases were found to involve an
abuse of a dominant position. In the first case, as a result of
telecommunications
illegal price-fixing in the provision of
services (13). The
it
concerned an economic sector subject to state regulation and
the Commission thus felt
it should take action, even
that
though prices were subject to sectoral regulation.

ruling was also noteworthy because

1310/97 (15) and in particular
arising from the Gencor/Commission ruling (16).

incorporating the case-law

3.5.3
The new regulation also amends jurisdictional aspects,
by referring what the Commission or at least three Member
States deem to be national issues to the national authorities in
the Community
order significantly to reduce the work of
competition authorities. In our view, however, this responsi-
bility can only be handed over to the Member States if it does
not affect a substantial part of the common market, which
to prevent restriction of competition and
makes it easier
protect the interests of those affected, especially consumers.

In the second case, concerning Microsoft, the issue
3.4.4
was more complicated, because this is a US company with an
almost total monopoly over the use of its computer systems.
Nevertheless, the Commission decided that Article 82 had been
infringed, through Microsoft's abuse of a dominant position in
the PC operating systems market by refusing to provide infor-
mation on interoperability and above all by bundling Windows
Media Player with Windows. The Commission not only
imposed substantial fines for a very serious infringement, but
also required Microsoft to adopt a set of measures, making
available information on its operating systems and unbundling
the individual components of its Windows operating system.

3.5 Merger control

3.5.1
The EC Treaty contained no specific article regulating
mergers, initially because this type of economic operation was
not common and later because Member State authorities
supported mergers in order to make national companies more
competitive. Nevertheless, when these mergers
resulted in
dominant positions, both Articles 81 and 82 were applied, but
with one proviso; these mergers would not be examined as a
matter of course, but only when an abuse of a dominant posi-
tion had occurred.

3.5.2
To remedy this shortcoming and to make proper
monitoring possible, on the basis of Articles 83 and 308 TEC,
which allow for additional powers to achieve the stated aims
— in this case free competition — the Council adopted a
number of regulations leading up to the current Regulation
139/2004 (14)
and improving Regulation (EC)

amending

3.5.4 With regard to the amendments of substantive aspects,
both the quantitative thresholds set out in Article 1 and the
conceptual thresholds in Article 2 are more clearly defined,
thus clarifying in what situations a dominant position occurs
and in particular where competition is substantially reduced.

to Member States,

Other, equally important, aspects

3.5.5
that have been
changed, are those covering procedures, which have been
substantially amended with regard to extending deadlines for
referring cases
enabling the parties
concerned to take more effective action, whilst respecting the
provisions of national legislation. The same applies to deadlines
for the requesting parties; in this case 15 working days at the
very beginning of the procedure could be seen as being too
rigid, as this would deny the parties the opportunity to famil-
submitted to the
iarise
Commission in connection with the case.
it
In any event,
should be pointed out that at no stage of the procedure is there
any provision that allows consumers to take action and, what
is more,
the
employees of the undertakings and employment when evalu-
ating mergers has disappeared from the text.

themselves with any arguments

to consider the interests of

the requirement

3.6 Types of restriction on competition

In Articles 81 and 82,

the Community legislative
3.6.1
authority has drawn up a non-exhaustive list of what
it
considers to be prohibited practices, with the first article
covering collusive practices and the second abuse of a domi-
nant position. It must be stated first of all that these lists are
not complete, but simply indicate common practices in which
these two forms of behaviour occur, which means that others
having the same effects could be identified and would conse-
quently be subject to the same prohibition.

(11) Deutsche Telekom Case COM/C1/37. OJ L 263, 14.10.2003, p. 9.
(12) Microsoft Case COM/37/792.
(13) Deutsche Telekom substantially reduced its bundled line rates for
fixed telecommunications
access on its

broadband Internet
network.

(14) Council Regulation (EC) No 139/2004 of 20 January 2004 on the
concentrations between undertakings. OJ L 24,
control of
29.1.2004; Commission Regulation (EC) No 802/2004 of 7 April
2004 implementing Council Regulation (EC) No 139/2004, OJ L
133, 30.4.2004, p.1.

(15) Council Regulation (EEC) No 4064/89 (OJ L 395, 30.12.1989, p.1)
and the amendments made to this regulation by the Act of Acces-
sion of Austria, Finland and Sweden, were amended by the Regu-
lation referred to. The new regulation is thus a reworking of all the
legal texts and of the amendment of the articles subject to interpre-
tation in the light of case-law.

(16) Case T-102/96, in which the ECJ defined the concept of a domi-
nant position and that of a substantial reduction in competition to
include previously unclear situations, such as oligopolies,
for
example.

16.12.2006

EN

Official Journal of the European Union

C 309/5

3.6.2
cles:

The types of practice listed are similar in the two arti-

3.7.1 E ne r g y

— price fixing;

— limiting or controlling production, markets, technical devel-

opment, or investment;

— sharing markets or sources of supply;

In recent years, great progress has been made on
3.7.1.1
opening up the European energy (electricity and gas) sector
which until a short while ago was part of the public sector and
as such was controlled in terms of supply pricing and terms.
The Commission had provided for a market opening for all
non-domestic customers by 1 July 2004 and for all domestic
customers by 1 July 2007. The first deadline has not been
entirely met and as matters stand today, total liberalisation of
domestic consumption will also not be achieved.

— applying dissimilar conditions to equivalent

transactions

with other trading parties;

— making the conclusion of contracts subject to acceptance

by the other parties of supplementary obligations.

3.7.1.2
The situation is complicated and the performance of
privatised networks, especially in the electricity market, could
even be described as a poor, with these companies investing
little in maintenance, which has a significant impact on users,
who experience frequent power outages.

3.6.3
groups, reflecting the situation in which they occur:

All of the behaviour listed can be classified into two

a) Abuse of competition, which brings

together a large
to
number of anti-competitive practices, such as refusal
supply, fixing prices below cost price,
loyalty bonuses or
discriminatory pricing. This behaviour has an economic
effect; it reduces or prevents competition in the market or
in a substantial part of it.

b) The abuse or unfair exploitation of undertakings

that
depend on the dominant position of one or more compa-
nies for buying goods or services, by means of unfair
inefficiency or negligence or even
pricing, discrimination,
abuse of industrial property law.

interpreted broadly,

3.6.4
One of the most common types of abuse is price
to cover
fixing, a concept which is
discounts, excessive profit margins, payment terms or rebates.
Also covered are failing to honour prior commitments,
deviating from price lists and not selling at the stated price.
Consumers are affected in all of these cases — despite specific
legislation protecting their rights, they are in a position of
weakness vis-à-vis businesses that occupy a dominant position
in the market and which are often the only supplier in that par-
ticular market.

3.7 Competition developments in some liberalised sectors

Community competition policy, as set out in the TEC, was
designed with the traditional sectors of the European economy
in mind. Consequently, its implementing regulations have had
to develop in line with new economic developments, which
required greater competitiveness. The procedures under which
the liberalisation of major market sectors has taken place have
had a negative impact on consumers, since in most cases the
enterprises in question have gone from being public services to
undertakings with a dominant position in their respective
markets, with which other businesses struggle to compete.

the

However,

electricity

regulation (17)
current
3.7.1.3
promotes cross-border trade in electricity and it can help to
increase competition in the internal market, by means of a
mechanism compensating network operators and by estab-
lishing non-discriminatory and transparent tariffs that are not
distance-related.

The Commission then set up an energy sub-group,
3.7.1.4
as part of the European Competition Network,
in order to
discuss and draw up an agreement on applying Community
competition rules to the energy markets.

3.7.2 T e le c ommu ni c a ti ons

Legislation relating to the telecommunications sector
3.7.2.1
developed significantly in 2002 (18), largely due to the updating
of the package of rules on electronic communications, which
adapted the networks so that they could be used by the new
technologies. The various Member States' adaptation of the
the Ninth
legislation produced uneven results;
Report (19) on the Implementation of
the EU Electronic
Communications Regulatory Package focused on the process of
incorporating these regulations into national legislation, and on
the tasks to be performed by the national regulatory authorities
(NRAs).

in fact,

3.7.2.2
The Ninth Report notes that the number of opera-
tors has remained stable, although some of these have simply
stayed in their home market, whilst competitive pressure
between operators has shifted from the international markets
and long-distance calls to the local call market, with traditional
operators experiencing a gradual reduction in calls of this type.
Consumers have benefited from this in terms of call prices, but
they can also lose out in some cases as a result of their original
position being abused when it comes to signing new contracts.

(17) Regulation (EC) No 1228/2003 on conditions for access to the
network for cross-border exchanges in electricity. OJ L 176,
15.7.2003.

(18) Directive 2002/77/EC, (OJ L 249, 17.9.2002, p.21).
(19) COM(2003) 715 final.

C 309/6

EN

Official Journal of the European Union

16.12.2006

3.7.2.3 Monitoring the telecommunications markets closely
to determine the current state of competition to some extent
helps to monitor operators in a dominant position, so that
specific obligations can be imposed on them to ensure that
consumers do not suffer the imposition of unfavourable condi-
tions and prices. In any event, the Commission closely followed
up the implementation of Directive 2002/77/EC in each of the
Member States (20), with a view to remedying any shortcomings
detected that not only restricted competition but also affected
consumers' interests.

3.7.3 T r a nsp or t

The transport sector must be considered in the context of the
different modes of transport used; we will refer mainly to air,
rail and maritime transport, which have undergone substantial
changes,
in particular with a view to improving passenger
protection in the first case and maritime safety in the third.

3.7.3.1 Air transport

3.7.3.1.1
In 2003, the Commission opened dialogue with
the civil aviation sector with a view to drawing up a common
position on implementing competition policy in the alliances
and mergers taking place in that sector. It also became clear
this year that Regulation (EC) 1/2003 needed to be amended,
in order to increase air transport between the Union and third
countries, with the aim of creating an ‘open sky’ that would
enable action to be taken on alliances between undertakings
from Europe and from third countries, in particular the United
States. During this period, the Commission looked at various
agreements between undertakings and ruled that some contra-
vened the rules of competition (21) and imposed changes in
content and duration on others.

3.7.3.1.2
In the same period,
passengers' rights was adopted (22).

the regulation setting out

The first package of

3.7.3.2.2
rail directives aimed at
opening up the market was intended to ensure free movement
in cross-border goods transport and to establish a reference
framework for access to both goods and passenger services,
setting routes, fares, etc.

3.7.3.2.3
The second package includes the liberalisation of
national freight markets, and the opening-up of the national
and international passenger market.

3.7.3.2.4
The overall aim is to secure a common approach
to implementing competition legislation in the rail sector in
order to prevent conflicting decisions being taken by national
authorities and the Commission.

3.7.3.3 Maritime transport

3.7.3.3.1
the highest
The maritime sector has one of
numbers of block exemptions, relating in particular to liner
conferences and consortia, which comply with Regulation (EC)
review (23), and which seek to
823/2000, currently under
develop Article 81(3) TEC, because this allows maritime
consortia and conferences to exceed the limits laid down in
legislation provided that, the Commission having been notified,
authorisation is obtained for the opposition procedure.

3.7.3.3.2
In practice, some consortia have taken advantage
of these procedures to engage in practices not covered by the
exemption, such as price fixing, which has led to the Commis-
sion taking action (24), to restrict the content of agreements.
Similarly, the Court of First Instance (CFI) (25) delivered a ruling
on an agreement between maritime transport undertakings not
to give their customers discounts on the published tariff
charges and surcharges.

3.7.3.2 Rail transport

3.7.3.2.1
Regulation 1/2003 allows the national competition
authorities to apply rules to defend competition in the rail
sector. Community and national authorities are required to
identify issues of common interest relating to rail liberalisation,
in cooperation with the Directorate-General
for Energy and
Transport.

(20) See a detailed summary of measures adopted in the XXXIII
Commission report on competition policy — 2003 p. 41 et seq.
(21) The Commission refused to authorise the initial version of the Air
France/Alitalia agreement and requested that
the other parties
concerned submit their views on the matter. With regard to British
Airways and Iberia, the Commission limited the agreement's dura-
tion to six years.

(22) Regulation (EC) 261/2004 (OJ L 46, 17.2.2004, p.1).

3.8 Effects on consumers in the liberalised sectors examined

3.8.1
The procedures under which the liberalisation of the
sectors referred to above have taken place at national level, can
be considered to be harmful as regards the internal market,
having created oligopolies that have denied consumers genuine
competition that would help to bring prices down and to
stimulate competition between undertakings. The Commission
should also look closely at the effects that mergers in the liber-
alised sectors have had to date, especially on consumers.

(23) OJ C 233, 30.9.2003, p. 8.
(24) The Wallenius/Wilhelmsen/Hunday case 2002.
(25) Case IV/34.018. L 268, 2000, p. 1.

16.12.2006

EN

Official Journal of the European Union

C 309/7

3.8.2
In general terms, the lack of transparency, the high
and unjustified charges imposed on business customers and
consumers and the vertical
integration of undertakings have
not brought about real competition in the liberalised markets.
In fact, the terms of consumers' contracts have in many cases
failed to meet the standards set for standard contracts.

fied. The basic principle regulating this entire matter is that of
good faith and proper balance between parties, which means
that any instrument or clause contravening this principle can
be deemed an abuse or contrary to the consumer's interest.

3.8.3
The issue concerns the tools available to consumers
for enforcing their rights in disputes with such companies, in
particular by bringing legal action based on competition law, in
particular on Articles 81 and 82 of
the Treaty. The vast
majority of complaints lodged with the competition authorities,
the Commission and national authorities are made by busi-
nesses and the ECJ has not ruled on a single complaint made
by a private individual.

The relationship between antitrust policy and freedom
4.2.2
of choice for consumers has been one of the main concerns of
Community legislation, as recognised in former Article 85(3)
and in the current Article 81 TEC, which establish that collu-
can only be authorised where, despite
sive agreements
restricting competition, they offer some benefit to consumers.
A typical example of this would be competitors sharing out
geographical areas in order to secure total market coverage,
even in areas that are not profitable.

The Commission's presentation of the Green Paper on
3.8.4
rules (26) must
Damages actions for breach of
provide a tool for consumers, which will be discussed in detail
in the EESC opinion to be drawn up on the subject.

the EC antitrust

4. Competition policy and consumer protection

4.1
Consumers do, of course, have a specific body of legisla-
tion setting out their rights and obligations (27). Article 153(2)
TEC lays down that ‘Consumer protection requirements shall be
taken into account in defining and implementing other Community
policies and activities’. This is a horizontal policy and, as such,
must form part of all policies affecting consumers. There is no
doubt that, in the context of competition policy, consumers are
an integral part of the market covered, because they represent
demand within that market.

4.1.1
This paragraph attempts to determine which of consu-
mers' recognised rights are affected by competition policy, in
particular by the effects of non-compliance with these rules in
the internal market, and in what manner these rights are
affected. There is also a need to treat consumers as interested
parties in this policy so that the Commission can take account
of their interests when it has to take action in specific cases to
establish market rules.

4.2.3
In terms of consumer protection, supervising the
market means being attentive to potential horizontal agree-
ments, such as voluntary agreements, price cartels, common
purchasing centres, market sharing, etc., as well as vertical
agreements, such as contracts regulating relations between
producers and importers, etc. Attention is also paid to abuses
of a dominant position by means of practices that obstruct or
prevent competitors from entering the market, to setting prices
that are excessively high or
low, exclusionary pricing or
offering terms that discriminate between customers.

4.2.4
In its annual report, the Commission presents a large
number of decisions on alleged concerted practices and abuses
of a dominant position and some ECJ rulings that frequently
mark changes in interpretation of the law and even require
legislative changes to be made.

In recent years, the Commission has considered fewer
4.2.5
and fewer cases,
largely due to the firm line that national
competition authorities have taken towards their own markets,
and in particular as a result of the abolition of the notification
system. DG Competition resolved 24 cases by formal decision,
a very small number in comparison with the field of merger
in which a large number (231) of formal decisions
control,
were taken (28), complying with the procedure set out in the
amended regulation. Fewer decisions will be issued in the new
phase, when in most cases national authorities will take over
responsibility in this area.

4.2 Economic rights

4.2.1
The concept of consumers' economic rights is based
on the absence of any financial loss preventing the consumer
or user from using or enjoying the goods or services acquired
under the terms agreed with the undertaking should be clari-

(26) COM(2005) 672 final of 19.12.2005.
(27) See EESC opinion — INT/263, AC 594/2006, rapporteur, Mr

Pegado Liz.

4.2.6
Of the cases examined, some directly affected consu-
mers or were particularly important to them. The individual
decisions concerned the mobile telephone, broadcasting and
airline sectors (29), and in the sectoral initiatives, measures were

(28) See Annual Report — 2003, p. 191 et seq.
(29) See Box 3 in the 2003 Annual Report, p. 29 referring to abuses in
the telecommunications sector; Box 2 in the 2004 Annual Report,
p.28: the sale of sports rights for use over 3G networks, in the
Annual Report for 2004, p. 43.

C 309/8

EN

Official Journal of the European Union

16.12.2006

adopted in the transport, liberal professions, motor-vehicle and
media sectors (30). All of the cases examined concerned price-
related abuses, with Article 82 applying, as a result of abusive
exclusionary pricing for the provision of goods or services (31).

page (34) which even includes a complaints form (35) for any
harm they might suffer as a result of companies' anti-competi-
tive behaviour.

4.3 The right to be informed and to participate

5. Representative bodies

4.3.1
The effectiveness of consumer policy will depend on
consumers' participation in the policies that affect them, and
they must thus be involved in all policies in which they have to
date been excluded. One of the aims of the Consumer Policy
Strategy (32) was to ensure that consumer organisations were
sufficiently involved in Community policies and, indeed, one
year later, a Consumer Liaison Officer was appointed in DG
Competition.

The EESC considers that, in order to make consumers' right to
be informed and to participate a reality,
it must firstly be
ensured that they are legitimately represented by their organisa-
tions. Secondly, it must be determined which body will ensure
this genuine participation, as discussed below.

5.1 For consumers

Consumer organisations have a forum — the Consu-
4.3.2
mers' Committee — the mechanism for taking action specifi-
cally on consumer policy, but this has not been extended to
include participation in other policies. The current aim is for
consumers to be able to make a contribution to Community
initiatives, at all stages of the EU decision-making process.
Minimum requirements will have to be set, enabling consumers
to participate in consultative bodies, as already happens in agri-
culture and in particular in the newer bodies, such as those for
transport, energy, telecommunications or any other that might
be set up.

Consumer organisations are regulated by national
5.1.1
rules that lay down minimum requirements for them to be
recognised and legitimate, to ensure that they have the legiti-
macy to exercise their rights as consumers when these rights
are affected by any prohibited practice.

5.1.2
At European level, all organisations registered with
DG SANCO are fully recognised and are entitled to be informed
and consulted and are involved in any matter that is considered
to fall within their sphere of competence.

4.3.3 With regard to the issue now under consideration,
there is no formal means of participation, and consumers are
not even consulted on issues that
the Treaty considers to
concern them, such as exemptions from the rules on concerted
practices, Article 81(3) and abusive practices that
limit or
control production, markets or technical development to the
detriment of consumers, Article 82(b).
is therefore the
responsibility of DG competition and consumer organisations
to set up mechanisms for participation and consultation,
through rules agreed on jointly and which will have an impact
on the internal market, as set out in the White Paper on Euro-
pean Governance (33).

It

Equal responsibility falls to DG SANCO: it could use
4.3.4
the European Consumer Consultative Group to take action on
competition-related issues that affect consumers' rights.

Consumers' right to information concerning competi-
4.3.5
tion has been given a boost by the appointment of a liaison
officer to act as a point of contact with them. European
consumer organisations are informed regularly and national
organisations and individual consumers have their own web

(30) See Annual Report 2004, transport. p. 52; Liberal professions,
Annual Report for 2003, p.60; motor vehicle distribution, Annual
report for 2004, p. 44.

(31) The British Telecommunications Case, OJ L 360, was particularly
significant because it concerned what was still state monopoly.
(32) Commission Communication on Consumer Policy Strategy 2002-

2006 — COM(2002) 208 final.

(33) COM(2001) 248 final.

these tend to concern breaches of

5.1.3
This legitimacy, which is somewhat exclusive, can be
questioned when competition-related issues are at stake, given
that
tangible consumer
rights, including those that are limited to certain territories and
to certain issues. A wide-ranging debate should be held on the
concept of having the legitimacy to take action in this area.

5.2 The European Competition Network

Regulation 1/2003 EC (36) and what is known as the
5.2.1
'modernisation package' established the means of cooperation
between the Commission and the competition authorities that
form the European Competition Network (ECN) (37). This
network started its work in 2003, with a working group that
examined more general issues such how it would operate and
the arrangements for communication between national authori-
ties. It is now fully operational, and is divided into 14 sub-
groups, which address sectoral issues (38).

(34) Web page:

http://europa.eu.int/comm/consumers/redress/compl/index_en.htm.

(35) Will be appended.
(36) Of 16 December 2002 on the implementation of the rules on
competition laid down in Articles 81 and 82 of the Treaty, subse-
quently amended by Regulation (EC) 411/2004, OJ L 68, 6.3.2004,
p. 1.

(37) Commission Notice on cooperation within the Network of Compe-

tition Authorities, OJ C 101, 27.4.2004, p. 43).

(38) In 2004, the sub-groups examined 298 cases, 99 of which had
been referred by the Commission and 199 by national competition
authorities.

16.12.2006

EN

Official Journal of the European Union

C 309/9

5.2.2
Regulation 1/2003 grants the ECN's member authori-
ties the means to help one another and to act on the instruc-
tions of the competent authority and more generally to gather
information needed to solve the problems under their
all
consideration. They also take charge of investigations requested
by national authorities, the results of which are forwarded in
line with established procedure, so that they can be accessed by
all parties concerned.

5.2.3
The ECN's action as part of the leniency programme is
very important because Member States have signed a declara-
tion committing themselves to abide by the rules set out in the
notice referred to above. The network thus provides practical
assistance to the national courts with jurisdiction over competi-
tion, which are also responsible for keeping up to date with the
case-law of the European Court of Justice (39).

5.2.4
The necessary communication between the ECN, the
competition authorities and the courts helps to disseminate
information on cartels and abuses of a dominant position and
the applicable procedure, thus enabling a decision to be taken
on who should bring the case more rapidly than has until
recently been the norm.

Another of the ECN's tasks is to detect infringements
5.2.5
and this activity, which is
really a form of prevention,
diminishes the harmful effects on competitors and consumers.
One task that should be highlighted is the network's action on
exemption procedures, in which it must be assessed whether
the outcome benefits consumers and even whether the agree-
ment should include a reference to the tangible benefits that
consumers can expect from it.

Brussels, 5 July 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND

(39) Commission Notice on the cooperation between the Commission
and the courts of the EU Member States in the application of Arti-
cles 81 and 82 EC, (OJ C 101, 27.4.2004, p. 54).