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What is competition policy?

Actualizado: 18 dic 2017

Competition policy is a policy carry out by the European Union with the objective to achive an economy with high and sustainable growth with productivity. To aim this, it deals with policies in the internal markets, industry, research , innovation and space.

Competition puts bussiness under constante pressure to offer the best possible range of goods at the best possible prices.

The European Comission together with other institutions of the European Union are responsible for carrying out this policy.

Importance of competition policy for UE economy?
  • Competition policy is of vital importance as a regulating element of the market economy. For example, avoiding monopolistic activities, mergers and cártels.

  • It encourages competitiveness of EU companies. Competition policy forces companies to offer good quality to customers, to be more innovative and induces firms to enhance their efficiency. Moreover, economic liberalization, which is often associated with privatization, is the process of transferring ownership or outsourcing of a business, enterprise, agency, public service or public property from the public sector to the private sector. For example, the European Union has liberalized gas and electricity markets, instituting a competitive system.

  • To promote economic progress. Competition policies favor the creation of employment, development of technologies and the improvement of the quality of services and products offered by the companies. All this makes the economy more productive. For example, competition raises business executives incentives to out- perform competitors and, therefore, is often associated with higher levels of productivity. Another example is the increase in quality and efficiency in the public sector leads to economic growth.

  • To create a fair market by appliying rules for businesses and companies, this lead to a wider choice for consumers and help reduce prices and improve quality.


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