Our practice group introduced this new field of law with a view to upcoming new regulations for public authorities that perform economic activities on an open market. Those authorities may enjoy benefits that private companies do not have and may lead to market disruption which in its turn may harm the Dutch economy.
This problem is known as "Market & Government". The Ministry
of Economic Affairs has been tackling these problems for several
years now, attempting to achieve equality in the competitive
relationship that public authorities and other market sectors
sometimes share. A code of conduct must prevent public authorities
from unfairly competing with companies.
Market & Government legislative
proposal
The Dutch House of Representatives passed the Market &
Government legislative proposal on 24 March 2009, and it is
currently being debated in the Senate. The purpose of this Bill is
to lay down rules of conduct in order to ensure as far as possible
that the competitive conditions for government authorities offering
goods or services on a given market are the same as those for
'ordinary' businesses on this market. For example, the full cost
price must be charged, public undertakings may not be given
preferential treatment, information may not be kept exclusively for
the government's economic activities, and government authorities
must be prevented from assigning public and economic activities to
the same persons. The Netherlands Competition Authority
(NMa) will monitor compliance with these rules of conduct.
The NMa will be able to detect any contravention of the rules of
conduct, and may impose an order for incremental penalty payments
that will serve to terminate the contravention.
Market & Government within the EU?
Due to their involvement in the European economy, public
authorities are faced with special legislation at the European
level as well as nationally. For example, public authorities can
grant special or exclusive rights to certain organisations or
undertakings in order to ensure daily postal deliveries, rail
management or social housing. In addition, governments may decide
to outsource these jobs to organisations under government
management (such as public institutions).
Regulations for the "Commercial government"
Interference by a public authority may have a negative effect on
the competitiveness of companies and consumers on a certain market.
Many procedural and other rules apply to such state interference;
see for instance the rules on state aid, calls for tenders, competition
and freedom of
movement. Governments may furthermore affect competition by
creating legislation. Pursuant to European legislation such
legislation may not appreciably limit competition between Member
States. These states have a great deal of freedom in determining
regulation which has an influence on the competition.
What can we offer you?
To assist you while these new regulations are being
developed, we can offer you training and courses to prepare for or
study this subject matter. We will furthermore anticipate new
developments in this area of law and keep you informed by means of
newsletters and mailings.
We can also advise you, and assist you if necessary, in proceedings related to the above issues.