Sizing up the competition: explaining reform of European Union competition policy in the Covid-19 era

ABSTRACT

Ensuring fair competition has long been a core pillar of the European Union (EU). In the wake of the Covid-19 pandemic, however, the EU has diverted significantly from its traditional commitment to market-based competition, notably in state aid and foreign subsidies. This article explores change and continuity in post-Covid-19 European competition policy (ECP) by considering both the radicality and permanence of these changes. Using process-tracing based on primary documents, secondary materials, and personal interviews, this article examines recent shifts in EU competition policy, probing three causal factors: 1) digitization of the global economy; 2) geopoliticization of competition regulation; and 3) Brexit. We argue that the Covid-19 crisis has brought these pre-existing challenges to ECP to the fore and, thereby, created space for policy entrepreneurs in EU member state governments and institutions to push for greater promotion and protection of European industry in the internal market while reinforcing supranational competition enforcement.

KEYWORDS:

• Competition
• covid-19
• digitization
• European Union
• state aid

Disclosure statement

No potential conflict of interest was reported by the authors.

Interviews

Interview 1: Senior official in the Permanent representation of the Netherlands to the EU, Brussels, 9 January 2020

Interview 2: Senior official in DG COMP (antitrust), Brussels, 8 January 2020

Interview 3: Official in DG COMP (merger control), Brussels, 8 January 2020

Interview 4: Senior official in DG COMP (evaluation), Brussels, 8 January 2020

Interview 5: Official in the Permanent representation of Germany to the EU, Brussels, 9 January 2020