Competition law is one of the areas of competence of the European Union. It comprises three main policy areas:
- antitrust: control of agreements and abusive practices by companies which have effects, or are implemented, in the EU (or, following the Agreement on the European Economic Area, the EEA). This is similar to US antitrust.
- mergers: control of proposed mergers, acquisitions and joint ventures involving companies which have a certain, defined amount of turnover in the EU/EEA.
- state aid: control of direct and indirect aid given by EU Member States to companies.
This last point is a unique characteristic of the EU competition law regime. As the EU is made up of independent Member States, both competition policy and the creation of the European single market could be rendered ineffective were Member States free to support national companies as they saw fit.
Primary competence for applying EU competition law rests with European Commission and its Directorate General for Competition, although state aids in some sectors, such as transport, are handled by other Directorates General.. On 1 May 2004 a decentralised regime for antitrust will be put in place which is intended to increase the application of EU competition law by national competition authorities and national courts.
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