MEPs attack ‘small print’ in Monti’s anti-trust blueprint

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Series Details Vol 7, No.17, 26.4.01, p23
Publication Date 26/04/2001
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Date: 26/04/01

By Peter Chapman

MEPs are demanding changes to the 'anti-business' small print of Mario Monti's plans to give EU anti-trust laws their first major facelift for 30 years.

The warning comes as the competition Commissioner continues to promote his blueprint for slashing the red tape which entangles industry.

Monti believes this stops his hard-pressed officials from fighting the worst cases of price rigging and abuses of monopoly.

The EU's anti-trust rules generally outlaw deals between firms which would harm EU consumers by restricting supply or prices. Under Monti's reforms, launched in 1999, firms would no longer have to write to the Commission seeking an exemption from the rules for each and every minor business deal which would not harm competition.

This 'notification system' would be scrapped, with firms relying on their own lawyers' advice, which would then be open to legal challenge. At the same time, national courts would shoulder far more of the burden for policing suspect business deals.

A draft report, set to be tabled by the Parliament's industry committee, says Monti has got it spot-on with his plan to cut red tape as the EU prepares for enlargement.

It also applauds his plan for EU competition laws to apply in all national cases that involve companies or consumers in more than one member state.

This would make it easier for firms operating across borders to know the rules of the game.

But the committee's rapporteur Jonathan Evans says he wants to get rid of other measures which would undo Monti's good intentions and add extra burdens on firms for no extra benefit.

Top of Evans' hit-list is a clause that would force firms, on demand, to send details of their deals to the Commission to be entered into a formal register.

Evans says this measure - inserted at the request of Germany which has a domestic register - would place a bureaucratic burden on companies without granting them the same legal rights to exemption from fines afforded by the current notification system.

He says the attempt to give more powers to national authorities and courts should not lead to an erosion in legal certainty for firms - echoing fears voiced recently by employer federations such as the UK's Confederation of British Industry and its European counterpart UNICE.

Giving national courts the right to deliver fines or criminal punishments in line with national and not European rules would add to this risk of legal uncertainty in the single market.

He says this could be lessened if the Commission kept a bigger role for itself to take rulings on its own initiative in the "public interest".

Crucially, firms would be able to apply to the Commission for an exemption involving big ticket deals which "involves a significant financial risk" or "potentially significant effect upon shareholder value".

Monti's attempt to give the Commission formal rights to break up companies to cure anti-competitive behaviour also come under attack.

Monti claims it is a right that has always existed and the new rules would just put it in black and white. But Welsh Tory Evans says it is "inappropriate and premature" to grant the Commission this 'nuclear option'.

MEPs are demanding changes to the 'anti-business' small print of Mario Monti's plans to give EU anti-trust laws their first major facelift for 30 years.

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