New Study on the ECN+ Directive
In order to ensure that all European citizens and companies can benefit from a well-functioning internal market, the existence of robust and common enforcement of EU competition rules across each Member State is key. Furthermore, the effective enforcement of EU competition rules is indispensable for the Union, both to encourage innovation, to help make European companies stronger outside the EU, and to offer consumers goods and services with improved quality and at lower prices.
Spark is happy to undertake an important supporting role in the enforcement of EU competition rules, by carrying out the study on the ‘Assessment of Completeness and Conformity of Member States’ Measures to Transpose Directive (EU) 2019/1 of 11 December 2018 (ECN+ Directive) (COMP-2021-OP-0001)’, together with a network of national legal experts.
The ECN+ Directive seeks to further empower the national competition authorities of Member States (NCAs) to co-enforce EU competition rules laid down by the EU treaties, by addressing the means, instruments and resources which are available to the NCAs to ensure this enforcement. Building upon Regulation 1/2003, the ECN+ Directive focuses on eight key areas, namely, fundamental rights, independence, resources, effective investigative powers, effective decision-making powers, fines and periodic penalty payments, leniency programmes for secret cartels, and mutual assistance, which have been identified as essential to achieve the empowerment of Member States in enforcing competition rules.
Over the course of the next two years, the study will assist the Commission in assessing the completeness and conformity of Member States’ national transposition measures of the Directive. The study commenced at an important time, nine months following the deadline that was given to each Member State to transpose the Directive.
Spark is looking forward to making progress with the Study, towards obtaining further knowledge and key information on the transposition of this important piece of legislation at national level. Stay tuned for more updates in the coming months.
- Background to the ECN+ Study
The implementation of the ECN+ Directive in Member States represents an important development in EU competition law, where national competition authorities are provided with increased power in order to achieve better enforcement of competition rules across the Union. Building upon the success of the decentralised system of competition enforcement established by Regulation 1/2003, the ECN+ Directive seeks to further boost the enforcement of EU competition rules at Member State level, by providing National Competition Authorities (NCAs) with increased means and instruments and by harmonising these measures available to NCAs.
Between the years 2013 and 2014, the Commission carried out an assessment of Regulation 1/2003, and published the Communication on Ten Years on Antitrust Enforcement under Regulation 1/2003. The Commission concluded that ‘the new system has positively contributed to the stronger enforcement of the EU competition rules […], and NCAs have become key pillar of the application of the EU competition rules and have considerably boosted enforcement’, but also stressed that there ‘is room for improvement’ regarding the current enforcement regime, in particular, with ensuring that NCAs have ‘effective enforcement powers and fining tools’. Legislative action through the implementation of a Directive was chosen by the Commission to be the most suitable option to achieve the intended objectives of strengthening NCA enforcement.
The Directive and its implementation play a crucial role in both the enforcement of EU Competition rules, giving effect to Articles 101 and 102 of the Treaty on the Functioning of the Union (TFEU), and in the support of the functioning of the internal market, on the basis of Article 114 TFEU. As highlighted by the EU Commission in its 2017 proposal for the ECN+ Directive, EU competition rules are ‘a defining feature of the internal market’. The distortion of competition in the Union can hamper the ability of the internal market to function to its full potential, thereby effecting sustained economic growth. In recognising the key importance of robust enforcement of EU competition rules, a key objective for the Commission in proposing the ECN+ Directive was the ‘untapped potential’ of NCAs regarding enforcement of EU competition rules, and that enforcement by both the EU Commission and the NCAs represent ‘an essential building block for the creation of an open, competitive and innovative internal market and is crucial for creating jobs and growth in important sectors of the economy, in particular, the energy, telecoms, digital and transport sectors.’
The European Parliament and the Council of the European Union reached political agreement on the ECN+ Directive on 30 May 2018 following three trilogues and the ECN+ Directive was adopted on 11 December 2018 by the European Parliament and the Council of the European Union. Under Article 34, Member States were required to fully transpose the Directive by 4 February 2021.
- The purpose of the Study and Spark’s Role
The objective of the Study is to assess the completeness and conformity of the measures adopted by the 27 EU Member States to transpose the ECN+ Directive into national law. The Commission will use the assessment completed by Spark as background information in support of its task to ensure, in accordance with Article 17 TFEU, that the ECN+ Directive is fully and correctly transposed in the Member States.
Spark will collaborate with a network of legal experts based in each of the 27 Member States in order to assess the completeness and conformity of the Directive, providing an in-depth analysis of the transposition in each Member State.