Konkurransetilsynet

One year ago the OECD countries were suffering from the worst depression since World War II. Considerably uncertainty reigned about how long the recession would last and how deep it would be. Even though Norway was better placed than many other countries, we also experienced a rapid drop in production and burgeoning unemployment, particularly in the building and construction industry.

In cooperation with the competition authorities in the other Nordic countries we took a closer look at the sort of challenges our authorities would be facing as a result of the financial crisis. The conclusion was clear: our competition legislation was well equipped to meet the financial crisis and its effects, and more importantly, our competition policy should remain in place. The European Commission was also clear on this point. Competition Commissioner Neelie Kroes emphasised on several occasions the importance of not relaxing competition policy and not embarking on destructive competition in government support in a short-sighted attempt to support industry in our individual countries.

The message of not repeating the mistakes made during the 1930s depression hit home and the crisis measures imposed were targeted and effective. The package of measures adopted in Norway helped to ensure that we are now on a path towards a more normal economic growth rate and that unemployment is low as compared to many other countries.

The Competition Authority experienced the financial crisis in several different ways. There was a substantial reduction in the number of ordinary reports about company mergers: down from 440 in 2008 to 293 in 2009. The implementation ban was challenged on several occasions, even though the Competition Act provides for dispensation if circumstances so dictate.
Another area is the ban on illegal cooperation. While it is important to return rapidly to the budgetary rule for using oil funds, some industries are still struggling. In this type of situation it may be tempting to cooperate on prices and share markets rather than to compete. The Competition Authority was quick to realise that the package of measures imposed would present the Competition Authority with a few challenges. In order to get the best possible value from each krone in the package, it was important to have fully functional competition in respect of public tenders.

This is why the battle against cartels and illegal cooperation has been a high priority during the past year. Bid-rigging and other competition crime results in reduced economic growth and higher prices, and at the end of the day it is consumers and taxpayers who foot the bill.

This initiative will be continued with full force in 2010. However, our experience in applying the current Competition Act has shown us that we still face challenges in achieving a convincing deterrent effect. During the year ahead we will therefore undertake targeted work designed to put into place a leniency programme that fulfils its purpose. At the same time we will be working to harmonise fine levels and practices with those of the EU.

The importance of having efficient competition policy is illustrated in this annual report by four specific examples.  We have taken a closer look at the tangible effects of one decision pursuant to the prohibition in Section 10 of the Competition Act, one decision pursuant to the merger rules in Section 16, the results of identifying a public measure pursuant to Section 9e and finally one example of what competition authorities can achieve by engaging in constructive dialogue. The results of these evaluations can be summarised relatively easily: competition policy benefits consumers and business that face tough international competition!