This project has received funding from the European Union’s Seventh Framework Programme for research, technological development and demonstration under grant agreement no 320294

EU

Non-competition interests are no competition for ‘Market Europe’: does EU competition law hamper the exercise of political rights? (D8.2)

July 13, 2017

This report has been drafted within the context of work package (WP) 8 of the bEUcitizen project. This WP focuses on political rights and thus aims to elaborate on the perceived tension between economic rights and political rights of European Union (EU) citizens. The present report contributes to this aim by providing an analysis of the tension between EU competition law and so-called Responsible Business Conduct (RBC) initiatives. The term RBC refers to initiatives of private businesses that do not solely aim at making profit, but also aim to achieve a wider social goal, such as environmental protection, protection of animal welfare or combatting low wages. In order to be effective, these RBC-initiatives are often carried out in cooperation between different private firms. This cooperative nature renders many RBC initiatives problematic from a competition law perspective, which prohibits anti-competitive agreements between undertakings.

The current report first provides an in-depth overview of what the authors refer to as the ‘competition law problem’ that often hinders these RBC-initiatives. The report then reflects at a more fundamental level on this competition law problem using three different lenses, which allow the reader to gain insights from different theoretical angles. Section 3 of the report places the competition law problem within the wider academic and political discussion on the ‘dis-embeddedness’ or ‘decoupling’ of the economic dimension side of EU integration (also called ‘Market Europe’) from the social dimension of EU integration (also called ‘Social Europe’). Section 4 focuses on the position of private firms as political actors when engaging in RBC-initiatives. This section thus analyses the central issue for this report from the perspective of various theoretical outlooks on the (political) role of private firms, including the ethics of the firm and the notion of corporate citizenship. Subsequently, section 5 focuses on the vertical relationship between the EU member states and the EU, reflecting on the possibility of a divergence between the approaches pushed for at the European and national level respectively. In the analysis, the report focuses mostly on the Netherlands as the developments here seem to be at the forefront of this discussion. While the report thus provides a case-study, the analysis will also provide insights relevant within a wider context since the highlighted tensions stem from European law,.

The report concludes i.a. that the tension between EU competition law and RBC-initiatives correlates with more fundamental changes within society, most notably a shift in thinking about the place of ‘the firm’ in society. These changes have provided an impetus for the increased engagement with RBC. At the same time, non-economic public interests seem to remain foreign to EU competition law. Until now, institutions – such as the EU Commission and the Dutch national competition authority – remain largely unable to weigh these interests in their competition law analysis. On the basis of the analysis in the report, it is argued that this demonstrates the disembedded nature of EU competition law and provides an example of the rising asymmetry between so-called ‘Social Europe’ and ‘Market Europe’. It is stressed that this tension seems problematic and could in the long run greaten the tensions between the EU and its member states. The report finally concludes that the problem might be solved by merging legal and political solutions at both the European level and the national level of the EU member states. However, these possible solutions deserve further scholarly attention.

 

Read the full report here