The Bundeskartellamt (FCO) has one core mission: protecting competition. Simple enough – or so it seems. In practice, competition enforcement rarely operates in a political vacuum. Calls for authorities to take broader policy considerations into account are becoming louder, while developments abroad highlight the importance of safeguarding institutional independence. In this context, the German Monopolies Commission has published a report on how to safeguard the FCO’s political independence. This week, we take a closer look at its proposals – and why they matter.
Is independence becoming a competition issue?
The Monopolies Commission – Germany’s independent advisory body on competition policy – frames the issue in straightforward terms: effective competition enforcement requires an authority that is protected from political influence.
The Monopolies Commission prepared this special report in response to developments abroad, where signs of political influence on competition authorities are becoming increasingly visible. Just three examples: Mexico’s reformed competition authority began operating around a year ago, replacing a constitutional independent authority with a body attached to the Ministry of Economic Affairs. In Brazil, senior positions – including the presidency of the competition authority – have reportedly remained vacant for months and are not expected to be filled until after the presidential election later this year, indicating a strong connection between the appointment and the outcome of said election. And in the United States, the Supreme Court recently held that the President may dismiss members of the Federal Trade Commission (FTC) at any time and without cause.
Three ideas for keeping politics at arm’s length
Germany has not experienced this kind of political interference. Direct political intervention in competition (but not in the regulator itself!) is possible through ministerial authorisation. However, these proceedings are rare. Nevertheless, the FCO is also familiar with public pressure and is currently experiencing it, for example, over high petrol prices. This makes the Monopolies Commission’s closer look at the FCO’s political independence particularly timely. Its report contains several proposals on how to safeguard the independence; here are my personal top three of the most interesting proposals (regarding the independence):
- A fixed term for the FCO President: The FCO President is currently a permanent civil servant appointed for an indefinite period – an outlier in the EU, where terms in neighbouring countries typically range from four to seven years. The Monopolies Commission proposes a single term of eight to twelve years. That could materially reshape the office: the current President, Andreas Mundt, has held the position for around 17 years.
- More transparency in case selection: The Monopolies Commission advocates for the FCO to publish enforcement priorities and explain the criteria it uses to decide which cases to pursue. Crucially, the authority itself would define those criteria. The aim is to make political steering more difficult. For practitioners, there would be a welcome side benefit: greater predictability in an area that is currently something of a black box.
- A fresh pair of eyes: The Monopolies Commission also looks at who takes the decisions. At the FCO, decisions are taken by three-member decision divisions, regardless of the type of proceedings. For the vast majority of cases, the Monopolies Commission considers this the right approach. But not every case is business as usual. Think Phase II merger reviews, major abuse of dominance cases or cases involving novel theories of harm. For these, the Monopolies Commission proposes bringing in additional people to provide a “fresh pair of eyes”. What could this look like according to the Monopolies Commission? First, expanding the decision division from three to five members for these cases. Second, giving the case team additional staff to keep proceedings within a reasonable timeframe. And third, including an external appointed Chief Economist. The Chief Economist would not participate in the formal decision, but would provide a separate economic perspective which should be published.
How has the FCO responded?
FCO President Andreas Mundt has welcomed the report. In a LinkedIn post, he said that the authority would examine the proposals carefully. His caveat is a practical one: any reform must also work in the day-to-day reality of the authority.
Outlook
- The report is not legally binding. But the Monopolies Commission carries considerable weight in German competition-policy debates.
- One proposal is already moving towards legislation. The draft of the 12th amendment to the German Competition Act proposes to limit the FCO President’s term to eight years, without reappointment. The timing may soon become relevant: press reports suggest that Andreas Mundt is expected to retire at the end of 2026.
- The broader message is clear: the FCO is one of the world’s leading competition authorities and enjoys a strong international reputation. Keeping it that way means ensuring it remains independent. The report offers an opportunity to reflect on how that independence can best be preserved in the years ahead.
Picture by Saurav Mahto via Unsplash
