Marios Constantine Iacovides discusses his and Konstantinos Stylianou’s empirical investigations into how the goals of competition policy have evolved over time. They find that a multitude of goals have always been present in judicial and regulatory decisions, but the emphasis on certain goals has vacillated in response to the concerns of the time. Contemporary concerns about the health of democracy suggest a revival of ordoliberalism and protection of the competitive process.
A few years ago, Konstantinos Stylianou and I set out to find out what are the goals of European Union competition policy by looking at the totality of EU case law and decisions at the European Commission’s Directorate General for Competition (decisional practice). In doing so, we responded to a perceived need to provide data-driven clarity to an increasingly polarized and at times inimical debate among competition lawyers around the globe about the goals our legal rules are intended to protect. Although most competition lawyers and economists do not have to think about it very often, the debate about goals matters tremendously. Ultimately, goals define what is procompetitive, and therefore allowed under the rules, or anticompetitive, and therefore prohibited. The choice of goals also conceals a deeper (and highly political) vision relating to the belief (or not) that markets deliver positive social outcomes, the relative roles of the state and the market, as well as issues of merit, equality, and justice.
The perennial goals of EU competition policy
Our study investigated the entirety of the case law of the Court of Justice of the European Union (CJEU), the decisions of the European Commission, the opinions of Advocate Generals (AGs) of the CJEU, and speeches of EU Commissioners for Competition from 1960 to 2021. The 3,749 documents we reviewed covered all competition law instruments, i.e., merger control, prohibitions against anti-competitive agreements and abuse of dominance.
In that study, we looked into seven more traditional goals through keyword search, namely: efficiency, welfare, freedom to compete and protection of competitors, market structure, fairness, European integration, and the process of competition. We showed that EU competition law has historically pursued all seven goals rather than adhere to a single overarching goal, albeit emphasis on one goal or another has fluctuated over time and across institutions. This finding challenged the notion that EU competition law has been singularly concerned with consumer welfare or efficiency, as articulated by the predominant Chicago school’s economic-centric approach that narrows the focus of consumer welfare to efficiency, price and output. In fact, we observed that EU competition law has always been more concerned with ensuring that the right kind of market conditions which foster competition are in place rather than with specific outcomes. Thus, it seems to be more about safeguarding the competitive process and market structure rather than directly promoting outcomes like efficiency or consumer welfare.
We also observed that while the emphasis on different goals shifts over time, previous decisional practice, case law, and academic commentary do not appear to exert a consistent or reinforcing influence on subsequent decisional practice and cases. In other words, current trends emphasizing specific goals do not reflect clear responsiveness to past legal developments or intellectual trends. This suggests that the variety of EU competition law goals may be more deeply entrenched in the founding treaties and less susceptible to external influence than assumed. Thus, even if, say, the Commissioner for Competition, the Directorate General for Competition, and practitioners and the academic community would all settle on one single goal (e.g. consumer welfare), the courts might still pick and choose from the various goals available to them, as a matter of EU law, the one that best suits the case at hand. Stavros Markis has argued that EU competition policy displays the features of “responsive law” and is therefore able to accommodate reasonable disagreements about goals while striking a balance between being adaptive towards new ideas and maintaining the integrity and consistency of current procedure and the rule of law. Together, our studies suggest that EU competition law will not settle on a single goal but rather continue to pursue a plethora of goals, responding to the needs of the times and individual cases.
Tracing trends relating to which goals seemed to be on the rise, we saw indications of a recent but modest resurgence of ordoliberal values, such as commercial freedom and protection of competitors. When it comes to the Court of Justice, we noted a constant increase in the share of judgments that endorse the ordoliberal goals, effectively doubling in rate from the early 1990s to today. For Commission decisions, ordoliberal goals reached their peak in the early ‘80s and experienced a period of significant decline until 2012. Since 2013 the downward trend has been broken, and we now see a clear rise again.
Sustainability, workers’ rights, and privacy
Over the last few years, the EU and its member states have promulgated several new competition guidelines, including the new Guidelines on Horizontal Agreements, and the new Guidelines on collective agreements by solo self-employed workers. Other developments include cases decided by national competition authorities linking data protection with abuse of dominance. Academic debate has also explored how competition policy intersects with sustainability, workers’ rights, and privacy. We used our database (open to the public), augmented with additional documentation, to understand how EU competition law is thinking about these “contemporary” goals.
We made some surprising observations, which we published recently in a second paper in European Law Open.
First, we found little evidence that sustainability, labor, or privacy are discussed in case law, court opinions, enforcer decisions, or officials’ speeches, despite the attention they receive in public debate and in academic research. Of the 4,000 sources we explored, we found just under 50 sources related to sustainability, workers’ rights, and privacy. Moreover, all three themes are relatively recent, emerging primarily after 2000. This contrasts sharply with the historical persistence of traditional goals.
Second, we saw that privacy and workers’ rights do not seem to be recognized as goals of EU competition law. Regarding workers’ rights, we observed that EU competition law has consistently tried to avoid conflicts between rules and practices that protect workers and competition rules by finding that the latter does not apply to matters such as collective agreements, working conditions, etc.
Third, sustainability is partially endorsed as a goal, especially if we look at the practice of the European Commission. Of the mere 20 sources endorsing any of sustainability, workers’ rights, or privacy as goals, sustainability had the vast majority of endorsements: 18 in total. The differing treatment can possibly be attributed to the distinct legal bases each goal has under the EU Treaties. Sustainability enjoys stronger legal grounding through provisions like Article 11 of the Treaty on the Functioning of the European Union and Article 3(3) of the Treaty on European Union, which impose a “mainstreaming obligation” to integrate sustainability concerns into all EU policies and actively pursue them. By contrast, articles 9 and 13 of the TFEU concerning labour rights and data protection, respectively, provide weaker mandates. The EU’s competence in these three policy areas also differs.
The small sample of goal endorsements we were dealing with in this study meant we could study the material in depth. By doing so, we identified distinct “entry points” through which the three contemporary goals may gradually gain relevance in competition policy. Sustainability is recognized by the Commission and the Court as aligning with goals for innovation and consumer demand, thus becoming a relevant parameter for market competition.
Workers’ rights are acknowledged indirectly through case-law exemptions for collective bargaining and other working conditions and, more recently, through the rhetoric of fairness in Commission speeches.
Finally, privacy is beginning to be treated as a non-price parameter of competition relevant to consumer welfare. This shift is visible in the Court’s treatment of privacy in cases like Google Android and in the gradual evolution of the Commission’s rhetoric. Furthermore, the judgment in the Meta Platforms case suggests that privacy considerations may influence competition law enforcement indirectly. For example, a worsening of privacy conditions may be considered as an abuse of dominance, even if privacy is not yet formally recognized as a competition law objective.
Digital markets, democracy, and the return of Ordoliberalism in the era of Ribera era?
In both research projects, we noticed how different commissioners for competition highlighted different goals in their speeches, reflecting the distinct policy context and choices of their respective tenures. Neelie Kroes (commissioner for competition from 2004-2014) often mentioned consumer welfare as the goal of EU competition law in a time of privatization, market liberalization and at the height of the implementation of a more economics-centric approach. In contrast, Margrete Vestager (2014-2024) chose to emphasize fairness and sustainability. Notably, Vestager led European competition in the time following the financial crisis, when EU citizens lost faith in the ability of markets to deliver a just and prosperous future for all.
Commission President Ursula von der Leyen’s 2024 mission letter to the new commissioner for competition, Teresa Ribera, instructs her to “modernise the EU’s competition policy to ensure it supports European companies to innovate, compete and lead world-wide and contributes to our wider objectives on competitiveness and sustainability, social fairness and security.” So, what can we expect looking ahead into the next few years of competition law enforcement in Europe?
As mentioned above, in the first study, we saw a moderate resurgence of ordoliberal goals in EU competition law practice. Ribera’s rather wide mandate and the current geopolitical context might mean that ordoliberal goals will return to the forefront of EU competition law enforcement. It is worth remembering in this regard that both in the United States (with the creation of the Sherman Act) and in the EU (through ordoliberal ideas) there has historically been a nexus between competition policy and democracy. Specifically for Europe, as explained by Elias Deutscher in a recent paper:
Considering the role that large conglomerates and cartels had played in the fall of the Weimar Republic and the rise of the totalitarian Nazi regime, the members of the Ordoliberal School at the University of Freiburg in Germany argued that the excessive concentration of public and private economic power endangers democracy. Competition law therefore should in the first place be used to prevent and rein in the excessive concentration of economic power with a view to protecting individual economic liberty which [they] perceived as a corollary of political liberty and a fundamental precondition of a democratic society and polity.
In other words, markets—if competitive—will operate as institutions of antipower that regulate the power of powerful corporations and empowering the powerless. Seen in this light, the increasing concentration of market power in the hands of a few corporations in the digital sector and in media and recent political developments in the U.S. suggest that antitrust rules, by focusing on efficiency prices, output, and a specific notion of innovation, have failed to keep markets competitive and failed to prevent the erosion of democracy. Competition policy must reorient to recognize the deleterious impact market concentration may have on small- and medium-sized enterprises, on plurality and on the republican understanding of democracy, on workers, on marginalized citizens that do not necessarily participate on equal terms or at all in market mechanisms, the environment, and future generations.
Perhaps the time is ripe for Ribera to rectify that. The empirical research we have conducted shows that EU competition law really has never been about the “more economic approach” and the narrow consumer welfare standard that shaped competition policy for the last couple of decades in both Brussels and Washington was misguided. Tapping into this can enable Ribera to steer EU competition policy back into the ordoliberal ideal of dispersing economic power, maintaining dynamism, safeguarding the competitive process, and conserving a level playing field in markets. Competition policy can again become a tool to strengthen openness and plurality and support the fight for democracy.
Author Disclosure: Marios Iacovides received a research grant for his project with Konstantinos Stylianou on “the goals of the EU competition law” from the Swedish Competition Authority and the United Kingdom Economic and Social Research Council. His research is currently funded by the Royal Swedish Academy of Letters. You can read our disclosure policy here.
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