What to expect from Germany’s competition policy in the upcoming years

The German Ministry of Economic Affairs (called the Ministry of Economic Affairs and Climate Action since the Green Party took over the ministry, short BMWK) has published the German government’s competition policy agenda for the next three years. We have looked at the most important points (admittedly, not always with the otherwise warranted seriousness).

Grist for the mills of regulatory authorities  

First of all, the paper begins with a statement that should make regulatory authorities very happy: Regulatory policy is to be taken seriously! For the BMWK, this means two things: Firstly, to provide markets with a clear, reliable regulatory framework for the long-term public benefit. Secondly, to give room for private investments, market forces and competition within this regulatory framework. So far so good. However, this statement, for which the BMWK could actually throw five Euros into the Phrasenschwein^* is really broad. This might be one of the reasons why the BMWK is trying to substantiate this statement with the nine other statements.

Big tech must not be missing

In any paper (inter alia) dealing with the competition policy of the future, big tech naturally cannot be missing. The BWMK’s paper is no exception. Thus, the regulation of big tech is mentioned already in statement number two. The BMWK wants to strengthen private law enforcement, especially in the digital sector and makes proposals for the future development of German antitrust law. These proposals should – now read carefully – “focus on the special concerns of small and medium-sized enterprises and consumers as well as the aspects of innovation, sustainability and social justice” (an additional five Euros for the Phrasenschwein). Somewhat surprisingly, the reform of the ministerial permission is also addressed at this point, on which we have already reported here.

Green minister – does that mean anything?

As also reported in an earlier post, the BMWK is now headed by a minister from the Green party. Consistently, environmental protection is mentioned directly in the third statement of the paper. But that is not the end, of course. The topic of environmental protection extends to the next three statements. The BMWK emphasizes that “to manage the climate crisis successfully in the short time remaining and to master the transformation of the economy, a modern, efficient and investing state, as well as the mobilization of all private and public forces is required” (even ten Euros for the Phrasenschwein). Consumers who have just had to make high additional payments for their energy costs will of course be pleased to hear that the BMWK promises in statement four that competition policy can help to curb the rise in the price level for energy in the short and medium term (some will say unfortunately only curb the rise, not lower the price). As mentioned in statement five, companies, on the other hand, can look forward to a clear legal framework for sustainability cooperations (but it is also made clear that cartels cannot be “greenwashed” using environmental protection as a justification). By the way, the European Commission’s new draft horizontal guidelines published last week also contain a chapter on sustainability agreements.

Consumer protection – of course!

Yes, consumers will also profit. Statement number six emphasizes that consumer protection should be improved. Above all, structural shortcomings in law enforcement should be corrected so that “competition can better serve the interests of consumers” (another five euros for the Phrasenschwein).

What else is mentioned?

“A modern public procurement law is the key to fair and responsible competition for public contracts” (makes another ten Euro for the Phrasenschwein). After this surprising realisation, it is pointed out once again that public procurement can also set trends in the area of sustainability and digital transformation.

Furthermore, as laid out in statement eight, the IT infrastructure and staffing of the Bundeskartellamt is to be improved. At this point, however, a phrase makes one prick up one’s ears: The BMWK clearly states that even after the introduction of the DMA, the Bundeskartellamt should be able to investigate companies with paramount significance across markets (see here for some background of what exactly this means).

Statement nine is indeed interesting. After stating that competition policy can only succeed at European level (even if the Phrasenschwein is practically full, another five euros), it deals with what the BMWK wants to achieve at that level. The BMWK formulates concrete demands regarding the DMA, for example interoperability and portability of data with a simultaneously high level of data protection. It also re-emphasises its well-known position that national competition authorities should assist the Commission in enforcing the DMA (without being more specific).

In addition, the text in statement nine can be understood to better protect leniency applicants from private damages claims. As an ultima ratio, the unbundling of companies should also be possible (statement nine really has it in spades).

If you need a tenth statement…

As a final point, the BMWK emphasises how important effective advocacy against distortions of competition is for a fair competition on a global level. So true, so difficult.

But let’s get serious:

The paper deals with many current and important topics. Overall, it has a modern focus and shows that the BMWK aims to play an active role in shaping competition law beyond Germany. This is very ambitious, but with the recent GWB amendment and the regulation of big tech, the legislator in Germany has shown that it does not shy away from ambitious goals. In some places, concrete implementation ideas may still be lacking, but the foundation has been laid and it will be interesting to see how everything develops.

That is it for this not always entirely serious summary of the paper. In case you want to get the full picture, a good English translation of the paper is available here.

The author invites everyone who is able to say right off the bat how many euros are in the Phrasenschwein for a beer. So, feel free to reach out in case you got it right, but please do not cheat ;-).

^*Phrasenschwein: German readers might know the football TV show “Doppelpass”. When guests use statements/buzz phrases that contain typical football wisdom and are therefore (rightly) used often, those guests have to throw a few coins into a piggy bank called “Phrasenschwein”. One of the most famous examples of such football wisdom is “the ball is round and a game has 90 minutes”.