Adriaan DIERX

International workshop on"Opportunities for growth, trade and investments after the crisis"

9 – 10 November 2012, Cluj-Napoca

The contribution of competition policy to growth and investment in transport

Improving the competitive effects ofthe liberalisation of transport markets in the EU

Outline

1. Logistics & transport: Important for growth & jobs

2. Stepwise liberalisation of transport markets

3. Application of EU competition rules in transport

4. Impact of competition policy on productivity

5. Conclusion

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Logistics & transport: Important for growth and jobs

• Around 7% of EU value added and 5% of EU employment

• 10–15% of the cost of a finished product for European companies

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Essential input for other activities: Sectors benefitting from technological progress in trade, transport and communication

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Stepwise liberalisation of transport markets

1. Liberalisation of international markets• Maritime (1986, 1990)• Air (1997, 2007)• Road (early 1990s, 2011)• Rail freight (2007)• Rail passenger (2010)

2. Liberalisation of national markets• Rail passenger (2012)• Post (2002, 2011/2013)

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Application of EU competition rules

• Transport increasingly covered by generally applicable competition law framework (e.g. Council Regulation No.1/2003 on the implementation of Articles 101 and 102 of the TFEU » rules for antitrust enforcement)

• Regulations granting exemptions to some transport activities were repealed (e.g. repeal of liner conference block exemption as of October 2008) with some minor exceptions (e.g. maritime consortia)

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Areas of EU competition policy

Mergers (Council Regulation No.139/2004 )Control of mergers and other formal agreements between companies

Antitrust (Articles 101, 102 & 106 TFEU)•Article 101: Agreements between companies that restrict or distort competition (including cartels)•Article 102: Abuse of a dominant position (imposition of unfair trading conditions or limitations on production)•Article 106: Monitoring of public companies or companies having been granted special or exclusive responsibilities, such as the delivery of services of general economic interest

State Aid (Articles 107 & 108 TFEU)Monitoring financial support given to companies by Member States

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Competition policy issues in transport

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Sector characteristics

Consequences Policy aim

Access to infrastructure essential

Competitive advantage incumbent

Ensure equal access to network infrastructure

Vertically integrated service providers

Possibility of foreclosure

Ensure equal access to essential services

Important network effects

First-mover advantage

Ensure cheap and smooth transfer between service providers

Provision of services of general economic interest (SGEI)

Compensation for loss-making activities

Control of overcompensation for delivery of SGEI

Competition policy in practice

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Policy aim Cases Desired outcome

Ensure equal access to network infrastructure

Airline mergers

Slot commitments in congested airports

Ensure equal access to essential services

Deutsche Bahn

Fair pricing of electricity for traction trains

Ensure cheap and smooth transfer between service providers

Airline alliances

Weigh anticompetitive effects against efficiency gains

Control of overcompensation for delivery of SGEI

Postal cases Ensure level playing field for postal operators

Impact of competition policy on productivity

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ConclusionThe enforcement of competition policy rules in newly liberalised transport markets helps the Internal Market reach its full potential, because:

1.Fair competition turns the Internal Market into an incubator of innovative firms

2.Strong competition within the Internal market gives EU firms an edge over their global competitors

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