Belgian Competition Authority Welcomes Idea of Merging with Other Market Regulators
- 17/06/2024
- News
The Belgian Competition Authority (BCA) published on 13 June 2024 an opinion analysing the benefits and drawbacks of a possible merger with other market regulators (the Opinion).
The Opinion was in response to two draft Resolutions regarding a possible merger of several market regulators tabled with the Chamber of Representatives of the federal Parliament (draft Resolutions 55K3033 and 55K0073). The Belgian Institute for Postal Services and Telecommunications (BIPT), the Commission for Electricity and Gas Regulation (CREG), the Financial Services and Markets Authority (FSMA) and the Pricing Observatory were also asked to give their view.
The BCA is favourable to the idea of a merger. According to the BCA, “merging several market regulators into a single institution with a clearly defined identity and mandate could (in addition to possibly reducing costs) streamline procedures and improve the consistency and effectiveness of interventions, to the benefit of the market and the end consumer”. While such a merger poses “a number of challenges” (loss of specialised knowledge of officials, complex transition phase during the merger, conflicts between the various tasks of the merged authority), the BCA considers that these challenges are “not insurmountable”. In practice, the BCA envisages three scenarios:
- A merger between all market regulators; the BCA is not favourable to this idea, as not all regulators have similar responsibilities. The BCA refers to the FSMA, whose tasks are very different from its own.
- A merger with regulators of network industries (the BIPT and the CREG). The BCA notes that, “given their remit to develop and maintain competition, these regulators deal with competition issues”, which is why it is “particularly coherent to consider merging them with the BCA”. However, the BCA notes that some of the tasks of the sector regulators are “far removed from the powers and concerns of the BCA”, which “reduces the value of the merger by blurring the positioning of the merged regulator in the eyes of the public”.
- A merger uniting “the regulatory institutions responsible for cross-cutting market, competition and consumer issues, in the broadest sense”. This would include not only the BCA and regulators of network industries but also specific departments of the Federal Public Service Economy (the Pricing Observatory and the Economic Inspectorate). The BCA believes that this would “lead to the creation of a market authority with a coherent mandate to serve Belgian consumers”.
Interestingly, the BIPT does not share the BCA’s position. In an opinion of 29 April 2024 (here and here) the BIPT expressed the view that “such a merger only makes sense if there are real synergies [...]. However, this has not been demonstrated and, on the contrary, appears to us to be unfounded”. For its part, the CREG has not yet issued an opinion.
These conflicting views also exist outside Belgium. For instance, the Spanish Parliament is currently considering the separation of previously merged regulators, while in the Netherlands, the Autoriteit Consument & Markt (ACM) has a broad remit and oversees competition, sector regulation and consumer protection. In Belgium, it is unclear whether the yet to be formed new federal government and the new federal Parliament will pursue this issue.
