Competition law is nothing new – it’s been around since the Roman Empire, albeit its rules and applications have evolved over time.
A quick history lesson: markets and trade guilds became subject to systems and (sometimes cruel) sanctions in Roman times. Fast-forward to the Middle Ages to when these systems and sanctions were adapted for legislation in England to control monopolies and restrictive practices. This was the precursor to the English common law of restraint of trade, which was the direct predecessor to modern competition law.
The US later developed modern competition law to effectively prohibit agreements designed to retrain another’s trade. This evolution in competition law was based on the prohibition of agreements that ran counter to public policy, unless the rationality of an agreement could be shown.
And so we skip a few hundred years to today when competition law, also known as antitrust law, is a rule that promotes and seeks to maintain market fairness by regulating anti-competitive corporate conduct.
It has historically evolved within territorial boundaries of nation-states, but the basic principles remain more or less the same. This is because trade entails a certain level of competition between businesses, as it has been since the dawn of the industrial age and so it continues with the rapidly evolving digital age.
The model effectively acts that start-ups and young firms can freely enter markets and compete with existing firms – or to use legal language, there are no barriers to entry. In economic terms, competitive free markets will deliver allocative, productive, and dynamic efficiency. This market fairness definition is at the core of Competition law, which became global in the 20th century, and is the essence of what Euclid Law does.
UK & EU Competition Law
In the UK and European Union context in which Euclid Law specialises, competition law promotes the maintenance of competition within the European Single Market. Broadly speaking, this means ensuring there are no cartels, monopolies and illicit behaviours that would damage the interests of society.
Most of the EU business law today derives from the TFEU (Treaty on the Functioning of the European Union), although it takes its roots in the Treaty of Rome and later the Treaty of Lisbon. Accordingly, competition law focuses mainly on:
- The prohibition of practices and agreements that restrict free trade and inter-business competition
- Dominant positions, or a firm abusively dominating a market with anti-competitive practices.
- Mergers and acquisitions of big corporations and joint ventures. A common competitive process of approval is to suggest ‘remedies’, or the obligation to divest part of the merged business/offer licences/access to facilities to enable other business to continue competing.
And that, very briefly, is Competition Law. Get more in-depth insights here.