The Causes and Consequences of the Collegial Implementation of European Competition Law

• Published date: 01 September 2013
• Date: 01 September 2013
• DOI: http://doi.org/10.1111/eulj.12035
• Author: Yannis Karagiannis

The Causes and Consequences of the

Collegial Implementation of European

Competition Law

Yannis Karagiannis*

Abstract: A major achievement of the new institutionalism is the formalisation of the

idea that certain policies, such as competition law, are more eff‌icient when administered

by a politically independent organisation. Based on this insight, several practitioners and

scholars criticise the European Community for relying too much on a multitask, colle-

gial, and therefore politicised organisation, the European Commission. Def‌ining collegi-

ality as the involvement of non-expert commissioners in the implementation of the EC

competition law, this article offers the f‌irst interdisciplinary analysis of the causes and

consequences of that peculiar European institution. The central f‌inding is that, far from

being a mistake or the product of unanticipated consequences, collegiality was a neces-

sary condition for the creation of supranational European law.

I Introduction

The effectiveness of certain policies is particularly sensitive to their institutional

context. Like monetary policy, competition law is one of them. According to

Richard Posner, ‘whether antitrust policy is sound depends on the enforcement

machinery as well as on legal doctrine. It is not enough to have good doctrine.’1

Partly for that reason, most competition laws in the world are enforced by expert

and independent bureaucracies. For example, in South Africa, ‘the independence of

the competition authorities from the inf‌luence of each other, the state, and private

stakeholders, is now entrenched in the provisions of the Competition Act 89 of

1998’2; in Turkey, ‘the independence of competition authorities has recently been the

cornerstone of institutional reforms’3; and in Asia, the Asian Development Bank has

long argued that ‘the independence of the competition authority, free from the

inf‌luence of the government, is crucial if stakeholders are to believe in the integrity

of the system.’4

* Assistant Professor, Institut Barcelona d’Estudis Internacionals. ykaragiannis@ibei.org.

1R. Posner, Antitrust Law (University of Chicago Press, 2001), at 266.

2Competition Commission of South Africa, Independence and Accountability of Competition Authorities

(UNCTAD Intergovernmental Group of Experts on Competition Law and Policy, 2008).

3Government of the Turkish Republic, Independence and Accountability of Competition Authorities

(UNCTAD Intergovernmental Group of Experts on Competition Law and Policy, 2008).

4Asian Development Bank, Competition Law Toolkit (ADB, Manila, 2007), at 46.

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Against this background, the institutional architecture of the European Union (not

Community) (‘EU’) anti-trust and merger control competition law seems odd.5Here,

anti-competitive agreements, abuses of market power, and mergers and acquisitions

are not regulated by an expert independent authority but by a collegial Commission.6

Crucially, the Commission comprises members with little or no knowledge of anti-

trust rules, yet the college decides by simple majority rule (Article 250 TFEU) and

without receiving instructions by national governments (Article 245 TFEU). Consider,

for example, the hypothetical case of a merger between two telecommunications

operators. The f‌inal decision does not depend on the equivalent of the Turkish

Rekabet Kurumu, the US Federal Trade Commission, the German Bundeskartellamt

or even some federal ministry of industry. Rather, it depends on a vast, non-expert

and largely unpredictable college, where the vote of the commissioner responsible for

competition counts exactly as much as that of the commissioners responsible for

agriculture, tourism or the budget.7

This article is an attempt to explain the constitutional rule of collegial decision

making in the EC competition law. To do so, I adopt an interdisciplinary perspective

that combines law, economics, political science and history. In a nutshell, I make two

arguments: (1) understanding the origins of that system is crucial for a correct appre-

ciation of its nature and of current debates; and (2) the choice faced by the architects

of Europe’s original (and continuing) institutions was not between having an expert,

independent competition regulator or a collegial system, but between having a com-

petition law or none at all. In other words, because the negotiators of the Treaty of

Paris of 1951 held radically divergent policy preferences, they could only accomplish

their task by consciously creating institutions that could insure each government

against the risk of embarking on an unwarranted adventure dictated by the others.

The collegial enforcement of European competition law was, therefore, neither a

mistake nor a random decision. The demonstration of this point contributes to a

deeper understanding of the context of the EC competition law, possibly bringing it

closer to the level of accumulated knowledge in the US anti-trust.8

In what follows, Section 2 explains the issues posed by the collegial, non-expert

enforcement of the EC competition law.9Section 3 frames these debates using some

standard analytical tools from institutional economics. Section 4 examines a number

of prominent explanatory theories that could be used to interpret the historical

record, and derives their observable implications.10 Section 5 then turns to the his-

torical record of the Paris negotiations of 1950–1951, which led to the creation of the

High Authority of the European Coal and Steel Community (ECSC) (the predecessor

5This article focuses on Art 101, Art 102 and merger control, and not on state aids and/or liberalisation.

6For an intra-European comparison, see J. Van de Gronde and S.A. De Vries, ‘Independent Competition

Authorities in the EU’, (2006) 2(1) Utrecht Law Review 32–66.

7For a case where the merger between two aircraft manufacturers was f‌inally decided by the Spanish

commissioner for f‌isheries [sic!], see A. Hill, ‘Brussels Split Over De Havilland Sale’, (1991) Financial

Times, October 1.

8eg R. Bork, ‘Legislative Intent and the Policy of the Sherman Act’, (1966) 9(1) Journal of Law and

Economics 7–48; F. McChesney and W. Shughart (eds), The Causes and Consequences of Antitrust: The

Public Choice Perspective (University of Chicago Press, 1996).

9Of course, were I the f‌irst to observe these problems, this paper would have no reason to be. The

value-added of Sections 2 and 3, therefore, does not reside in their theme, but in the framing of these

issues in terms of the standard concepts of institutional economics.

10 For this methodology, see G. King, R. Keohane and S. Verba, Designing Social Inquiry: Scientif‌ic

Inference in Qualitative Research (Princeton University Press, 1994).

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