Proposition 53K2592

Projet de loi portant insertion des dispositions réglant des matières visées à l'article 77 de la Constitution, dans le livre IV "Protection de la concurrence" et le livre V "La concurrence et les évolutions de prix" du Code de droit économique.

General information ¶

Submitted by

PS | SP the Di Rupo government

Submission date

Dec. 27, 2012

Official page

Visit

Status

Adopted

Requirement

Simple

Subjects

competition law commercial law prices policy price regulations company law legal code

Voting ¶

Voted to adopt

Groen CD&V Vooruit Ecolo LE PS | SP Open Vld MR

Voted to reject

N-VA VB

Abstained from voting

LDD

Party dissidents ¶

• Filip De Man (VB) abstained from voting.

Contact form ¶

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Discussion ¶

Feb. 28, 2013 | Plenary session (Chamber of representatives)

Full source

I refer to the written report.

Mr. Speaker, Mr. Deputy Prime Minister, Ladies and Gentlemen, the PS Group welcomes the projects submitted to the vote today. They respond to the strong will of the Socialists in terms of competition and market regulation. This will was reflected in the government statement a year ago.

The objectives of the texts are clear, and we have called them our wishes: supporting growth and controlling inflation, improving competitiveness, controlling prices and strengthening the Price Observatory. We all regretted the inefficiency of the Belgian Competition Authority as we know it today. The lack of responsiveness coupled with infinitely long action times and sanctions make that between the discovery of a price agreement and the judgment made, the consumer continues to suffer the consequences. Today, we are shortening action times while respecting the rights of defence. The independence and autonomy of the Belgian Competition Authority are strengthened and it is empowered to impose transitional measures.

Of course, some sorrowful minds may argue that it would have been better to create a market court instead of relying on the Brussels Court of Appeal, which receives new competences. You can still see the glass half empty but, for my part, I am rather of nature very optimistic about this project and the effectiveness of these future authorities.

The Price Observatory, created on the initiative of the PS, is strengthened by this long-awaited structural link with the Belgian Competition Authority. The Observatory will be able to bring the case directly to the Belgian Competition Authority when it notices an abnormal change in prices and structural market failures. It can then take provisional measures. Its quality reports, which, I recall, are carried out in full independence, will automatically seize the government which will thus be able to take the necessary measures. In short, the new Belgian Competition Authority becomes the armed arm of the Price Observatory. We are very happy about it.

The freezing of gas and electricity prices has sparked strong opposition. In the end, however, the competition continues to decline. If we act positively, transparency and regulation are not barriers to the market, unable to self-regulate. It is therefore necessary to have a strong, effective and independent Belgian Competition Authority with a Price Observatory used as a means of pressure. This is exactly what is put in place by the two bills that we will vote without hesitation.

Mr. Speaker, Mr. Minister, we were enthusiastic about your bill on the introduction of the Economic Code and have therefore responded positively to it. We have approved the first books. From book IV and V we expected something different.

Of course, we are in favor of good competition, as this offers the consumer a wide choice of products and services at competitive prices. It improves quality and stimulates technological progress. A competition authority should handle this.

That competition authority shall investigate and sanction restrictive competition practices, such as cartels, agreements and abuses. In addition, the Authority shall examine the admissibility of concentrations and their impact on the market. A thorough reform was needed for greater transparency, better procedures and accelerated rulings.

Under current legislation, the competition authority is divided into three components, namely the General Directorate, the Audit Board and the Competition Council. The General Directorate Competition today consists of officials, is headed by a Director-General, resorts under the FOD Economy and is charged with supporting tasks.

The Audit Council today has a strictly independent status, which is important, and is populated by auditors who are responsible for organizing the investigation on price agreement and cartel formation. They are under the leadership of the Auditor General.

Finally, there is the Competition Council under its chairman. This is a judicial body that sets out decisions on investigations conducted by the Audit Committee at an earlier stage. Decisions of the Council on restrictive practices and concentrations may be appealed to the Court of Appeal. The Council currently operates in principle independently from the FOD Economy. The examination by the Audit Committee and the drafting of the decision by the Council are strictly separate.

The proposed reform puts these existing shakes, the independence of the investigation and the judicial character of the decisions on the slope. The new competition authority would consist of a chairman, a competition college, a management committee and an audit board. The Chairman of the Audit Committee is a politically appointed confidant who gets a hand in both conducting the investigation and in making the decisions.

We regret that evolution, which abolishes the independent status of both the auditors who conduct the investigation and of the board members who make the decisions.

It is noteworthy that the Council of State draws a parallel with the Greek Competition Authority, which is not ⁇ a school example of effective market management. On page 163 the Council of State recalls that the Greek Competition Authority was already convicted by the European Court of Justice in 2005 for its poor internal structure.

The draft law does not take into account some basic principles. In the previous regulations, we could count on a full-fledged court of law, which is no longer the case. The administrative decisions in the new law will not have a sacred force.

We also have questions regarding the independence of the investigation, the rights of the defence, the restriction of access to an independent, impartial court and the fact that administrative and legal procedures are mixed.

We are not alone with our criticism. The State Council also had a lot of comments.

We have tried to update a few things through twelve amendments. However, only three amendments were heard.

We also have fundamental concerns with the exceptional college. It would have been much simpler and much more efficient to add a competition chamber to a limited number of commercial courts. In many cases, they are already charged with competition disputes. In addition, the Court of Appeal is also the appeal body in the present proposal.

Book V is about the Price Observatory, which is not a random choice. In fact, this is the recognition of the criticism of the business community, namely that we are facing a competitive disadvantage over our neighbors.

The Price Observatory must control the price evolution for the current majority. It is for her the alternative to the automatic wage indexation. After all, in the formation of the government it was conditioned that the index mechanism would not be tormented.

Nevertheless, all policymakers acknowledge that there is something wrong with our price evolution and our price structure. However, instead of addressing the problems at the source, in particular the cost structure, the government addresses the problems at the end of the value chain and at the end of pricing, especially when displaying prices in the store.

The draft law provides extensive opportunities for the Minister and public servants, in particular the reformed official competition authority, to block and lower prices or impose maximum prices for a wide range of products following an intervention of the Price Observatory. The Price Observatory makes findings and then informs the Minister and the competition authority.

"It will be possible for us from now on that only appointed officials will be able to assess whether the price used by a company is correct, even without any abuse by the company." That criticism comes not from us, but from a text by Toon Musschoot, former adviser to Minister De Clerck, today in The Standard on the legislative text, from an unmistakable source.

“The federal government is interfering in the pricing of the companies. They can freeze prices without abuse. The only motivation is when there is a problem, an abnormality. Those who thought that companies could determine the price of their products and services themselves and then the customers could decide who to buy their products from, are wrong. The government reserves the right to freeze the prices of services and goods.” – Toon Musschoot

I also refer to the opinion of the State Council. He argues that the competition authority is entrusted with a supplementary task relating to the control of prices, which comes above its task set out in Book IV, and which provides for competition. That is extremely exceptional, says the State Council, and he labels the policy measure on page 172 as “symptom control”.

When the government creates an independent and effective guard dog, it means by definition that it should no longer play a leading role in pricing. After all, a trade-competent guard dog occurs when the competition between the players is disturbed. By considering the two together, you actually give up your trust in the autonomous competition authority.

Furthermore, we question whether the procedures can gain time and whether they are efficient. After all, according to the State Council, the new provisions result in an unnecessary aggravation of the existing procedure. This is, therefore, the cause of the problems faced by the Competition Council in the past and for which no real solutions appear to be offered in the present draft.

I would like to quote a final quote from Today’s Standard: “Given the past, the focus will probably be on the products that the voter knows, rather than on the sectors where actual abuses occur.

The new law will therefore undoubtedly bring sufficient media attention to the policy makers involved, but ⁇ not realize the intended economic recovery.”

For these reasons, Mr. Minister, the N-VA group will not approve these drafts.

I find it difficult to pass what has been said here.

First, today, without any preparatory action, except for one advice, the minister can block all prices. That is the legislation today. This legislation has been in place for years. This project ends this. So if one says “the minister can from now on...” then one is fundamentally unfair. The government could and will not be able to do so in the future.

Second, it is said that we will address popular matters such as beer and energy, but not, for example, overflow in the port. Can I point out that one of the complaints submitted concerned precisely the ports and that a report has been made on this subject? If one says “this does not interest the ministers”, then the facts prove just the opposite. Reports are being made, including on practices carried out by the ports. So the beautiful example from the article can only be contradicted in the facts.

I would like to talk about the beer traders and about energy. Whoever takes the free market seriously should not let that free market function alone, because then he knows that that free market is nonexistent. The United States knows this for a hundred years, when it began to introduce cartel legislation. The European Union, for example, knows this too. Only a few years ago – repeatedly in the meantime – it blocked roaming prices by itself, without procedure. The defenders of the free market intervened because it did not work.

You also do not mention what the State Council feared. The Council of State asked whether everything was in accordance with the EU. You do not mention that in the file we gave you, there is a letter from the European Commissioner, who says that this reform is in line with what the European Union wants.

Rarely a European Commissioner writes a letter to a government saying it is good. Usually, a European Commissioner sends a letter if he does not like it. We have prepared this bill together with the European Commission. The Competition Director has been there several times. There is a letter from the European Commission that says this is the right way, that it is in line with where we should go. That can be said.

The only thing I am determining is the following. If there is no price intervention for ten years, if we have a four-year inflation that is higher than in our neighboring countries, then there is no problem. If we find ourselves in a situation where inflation is finally lower than that of our neighbors, then there is a problem. For whom ?

Mr. Speaker, Mr. Minister, we have discussed this in the committee extensively. One of the problems is that there is a generally accepted term, including international, about what abuse is. This term is no longer used here, but “abnormality” is used.

Moreover, and I read the same article that you yourself have cited, Belgium is also in line with the position of the European Commission. It also warned at the end of last year that a government-determined price level could jeopardize the competitiveness and the level of investment of a particular sector. Better not do so.

The European Commission said that if we block prices, that won’t work. I assume it worked.

I’ve said it before, the European Commission never wrote a letter to the government when energy prices rose sharply; then we never received a letter from the European Commission. When we blocked energy prices, we received a letter.

It was then said that it would not work. I note that the action of the government has disrupted the free market and that we have succeeded in what the European Commission has not succeeded in ten years. We currently have a free market for gas and electricity, especially for gas, and the consequences are on it. In January, gas prices, including distribution tariffs, fell by 5 % overall. That means that it worked.

I have here the letter from Mr. Almunia, European Commissioner; that letter is in the file.

He says very clearly: “This preliminary draft aligns the Belgian competition law even better with the existing competition rules and procedures in the European Union.” Competition Commissioner Almunia said the opposite.

You are referring to a letter that I still regret very much, from the moment when we blocked energy prices. I regret him for his selectivity. If one receives a letter at the moment when one does something and not when nothing happens, with all the consequences thereof, then I find that selective. I only note that Almunia has written in the meantime that this draft that we will approve is in line with and makes us better connected to the European Union.

Mr. Minister, also in the committee has been discussed the establishment of dividing lines between authorities such as the CREG, the BIPT and the Competition Authority. I also hear that these are confusing.