Recovery of the economy
The Competition Authority's 2011 Annual Report has been published.
Quotes:
„It is clear that it can have very damaging effects on competition and business operations if the debt problems of viable companies are not tackled decisively.” (p. 8)- „In 2010, the Competition Authority fined nine parties a total of almost one billion krónur in five cases.
- „Since the financial crash, the Competition Authority's caseload has increased significantly, both in the number of investigations and their scope.” (p. 15)
The Competition Authority is publishing its annual report today, under the headline, Recovery of the economy. The annual report covers the activities of the Competition Authority in 2010 and its objectives and priorities for 2011. It covers, among other things, the following:
- Bank takeovers of companies subject to conditions
The Competition Authority's position on banks' ownership of commercial enterprises is set out, and the conditions it has imposed on such ownership are discussed, in order to mitigate its harmful effects on competition (see p. 6).
- The restructuring of companies must be accelerated – the work has been progressing too slowly.
The projects of the Competition Authority aimed at accelerating the restructuring of companies are outlined, and an overview is given of some of the institution's projects since the banking collapse, which specifically concern the recovery of the business sector (see p. 8).
- The Competition Authority warns of excessive concentration in the financial market and sets conditions for cooperation between banks.
The general approach of the Competition Authority to consolidation in the financial market is discussed. The publication also contains an overview of the exemptions the Competition Authority has granted to financial institutions for cooperation in recent quarters (see p. 9).
- Investigation into competition law breaches leads to changes in the food market
The changes in the business practices of companies in the food market resulting from the recent decision on the competition law infringement by Hagah and six meat processing companies are discussed (see p. 10).
- A busy year in competition law – nearly a billion in fines
The annual report provides an overview of the main searches, fines and other interventions during 2010. Furthermore, all decisions of the Competition Authority, rulings of the Competition Appeals Board, and judgments of the District Court and the Supreme Court in this area are discussed (see pp. 14 and 18-30).
- The Competition Authority's priorities for 2011 – the recovery of the business sector must be accelerated (see p. 17).
Rögnvaldur J. Sæmundsson, Chairman of the Board:
„Experience has shown that competition accelerates necessary restructuring and speeds up economic recovery. Measures that reduce competition prevent necessary innovation and ultimately have a negative impact on consumer welfare.”
Páll Gunnar Pálsson, CEO:
„The Competition Authority has striven to use its powers to speed up the recovery of the business sector. For instance, the authority has made the takeover of businesses by banks conditional on reducing the risk that bank ownership will distort competition.
…
The Competition Authority has also striven to keep a watchful eye on any barriers to competition faced by new and smaller businesses trying to gain a foothold and grow alongside larger competitors. If barriers of this kind are not prevented, there is a particular risk that consumers will become victims of reduced competition.“
Annual Review of the Competition Authority – PDF document – Opens in a new window
