The European Antitrust Review 2014 • Section 3: Country chapters
Sweden: Competition Authority
The Swedish Competition Authority’s task is to work for efficient competition in the private and public sectors for the benefit of consumers as well as to work for efficient public procurement for the benefit of society and market participants.
In the last year we have seen a high level of activity in response to a growing interest concerning competition and public procurement. Our prioritising of law enforcement has led us to taking a number of cases to court in our efforts to establish judicial practice and to encourage greater compliance with the law.
The case against TeliaSonera, involving margin squeeze on the market for access to fixed access networks via resale services for ADSL connections, is one of the most important abuse of dominance cases that we have had to handle. The courts have clearly and unambiguously established that TeliaSonera committed a serious infringement of the Competition Act. A dominant actor cannot be allowed to abuse its dominant position by adopting a pricing policy that excludes competitors from the market.
One sector in which we have recently found cause to pursue matters is sport. We have investigated restrictions on competition in golf, bowling, gym facilities, ice hockey and motorsports. The Swedish Competition Authority’s enforcement is based on a case-by-case assessment and clearly takes into account the special conditions which apply to the sports sector. Sport has a special role in our society by contributing to wellbeing and togetherness. However, sections of the sports movement have also become increasingly commercialised, with significant revenues. This has led to certain sports-related activities becoming the subject of competition law provisions.
Anti-competitive public sales activities
In 2010 the Competition Act was amended to regulate anti-competitive public sales activities. This means that the state and municipalities may not compete with private enterprises in an unfair manner. Since the rules came into force the Swedish Competition Authority has taken half a dozen cases to court in its enforcement efforts in this area, which will lead to important judicial practice being established. We have also observed that public entities themselves have taken steps to ensure compliance with the legislation, thus rectifying competition problems.
Banking and financial markets
We are also currently focusing on banking and financial markets. We have posed a range of questions to banking and investment companies to investigate market and competition conditions within the sector.
Interest rates, mortgage interest rates and the banks’ margins in respect of these, and fees for mutual funds have all been the subject of our scrutiny. June 2013 saw the publication of the results of our inquiry in a report which confirmed that competition on the market is poor, and that consumers are in a weak position in relation to the banks. Among the report’s proposals for better functioning competition on the market, we recommend that a new and more effective legal framework is put in place to increase consumers’ capacity to compare banks’ products.
Examining competition on the Swedish market
Competition in Sweden can and should be continuously improved. At the end of the 2013 we will publish a government-commissioned report focused specifically on areas where we have noted particular competition problems. As well as proposing potential improvements to our enforcement tools we will also focus on the areas of building and construction, the road fuel market, dental care and competitive neutrality.
Sharpened enforcement tools
In 2013 the government-appointed investigator, Supreme Court Justice Severin Blomstrand, presented his report on ‘more effective supervision of competition’. The investigator made proposals in three areas:
‘Stop-the-clock’ in merger investigations
If this proposal is implemented we will be able to stop the clock and extend the investigation period while waiting for requested documentation to be provided by parties. This will strengthen our capacity to maintain a high quality in our investigations, and also mean that companies will not be able to impede our work without also being affected by a drawn-out investigation period.
Marker system in our leniency programme
The investigator proposes a marker system whereby a company can be first to report a cartel, and then later come forward with the necessary evidence and documentation. If another company then applies for leniency the first company will still have priority. This may lead to more companies considering applying for leniency at an earlier stage, in turn weakening existing cartels.
Securing evidence found during dawn raids
The investigation proposes that hard discs and other digital material should be able to be examined at the Swedish Competition Authority’s premises. It is important that there are clear rules on this to put the issue beyond debate, to avoid impairing or delaying our investigations.
Economic analysis at the forefront of our work
The modern competition act that entered into force in Sweden 20 years ago has been good for companies, for consumers and for society in general. One thing that has changed over the years is the significance of economic analysis in investigations. This is especially true for mergers and in abuse of dominance cases, but also in cartel investigations. This analysis has been shown to be of great use in our work to prove how market conditions or behaviour affect competition. I am convinced that the use of economic analysis will continue to be great and may even increase in the future. At an OECD-level, where the Competition Authority is very active, we are working on a project to highlight the possibility to measure and evaluate the benefit of competition legislation in economic terms. The methodological challenges here are significant, but nevertheless such evaluations are now periodically carried out by many leading competition authorities.
A vision for Competition – Competition Policy towards 2020
In 2013 I had the pleasure of presenting a forward-looking joint Nordic report on competition policy and competition legislation in the Nordic countries.
Competition policy plays a major role in enhancing efficiency and innovation within the economy. The report shows that in Sweden, as well as in the other Nordic countries, there is considerable scope for strengthening legal instruments and making competition policy more effective. The report forms a valuable basis in the debate on how effective competition policy and effective competition authorities can contribute to address future challenges to economic growth and welfare in the Nordic countries.
International work is naturally an integral aspect of the Competition Authority. We participate in the OECD, the ICN, UNCTAD and other forums with the aim of achieving more effective competition rules at home and internationally. A concrete example of our international work is the project that we are running through the Swedish International Development Agency with our sister authority in Georgia. The aim is to give advice and support which will lead to more effective competition rules and competition supervision.
Enforcing the competition rules
When companies, municipalities, public authorities or other actors become aware of the competition rules and procurement rules it is often straightforward to adapt to them. In many cases it is necessary to open a formal investigation and go to court to rectify a competition problem; however a number of actors become aware of a potential infringement at the stage of the Competition Authority’s preliminary inquiries, and modify their behaviour accordingly. Our goal is to remove competition problems and procurement errors, not to achieve a record number of court proceedings. But we will not hesitate to use all means available to us in tackling competition infringements.
Next Chapter: Sweden: Overview