HR3003 Business Issues and the Context of HR

Introduction

The European Union adopted a number of measures in order to ensure that the policies it creates ensure healthy competition and safeguard the interest of consumers and employees. Within this context, it also ensures that innovation is promoted. Through this discussion, an attempt has been made to discuss these very aspects particularly from the context of antitrust law. Antitrust and cartels, takeover examination, State aid, market liberalisation, and foreign collaboration are all aspects of competition policy (EPRS, 2019). The European Commission (EC) upholds antitrust law by its investigative and sanctioning authorities. Cases about the competition will be brought to the General Court, with challenges considered by the Court of Justice. The European Parliament is generally engaged in market issues through the consultation process there under Treaties, with significant examples being recommendations on antitrust penalties and encouraging national competition regulators. In the regular parliamentary process, the Parliament and the Council served as co-legislators on these two occasions.

Competition is necessary in a free-market economy. However, analysts may not think there will be pure competition in the actual life (both of these firms bidding over reasonably replaceable commodities because no one might control prices). While its advantages and disadvantages are debated, rivalry in consumer markets is widely regarded as providing more advantages as compared to the drawbacks. The main advantages that it carries are cheaper costs, superior goods, stronger creativity, a broader variety of options, and more productive manufacturing than can be accomplished by other structures, such as a monopoly scenario. Economists on major markets believe that economies in the free economy may be aimed at increasing the wellbeing of consumers or total (Jones and Sufrin 2016). Modern economic ideology, neoclassical philosophy of the economy, also holds that competition offers economy the best outcome.

Companies may compete by making an effort to lower its costs or delivering a more standardized and wide range of products and services to draw a wider consumer base and grow their business. Firms that market successfully, perform separately when subject to the stresses that their competitors intensify. The EC determines that competitive economies reduce prices, raise the quality and service standards, increase consumer preference and encourage innovation and entrepreneurial activity. Economic figures suggest that competition stimulates development and production (Ezrachi, 2018). It also fosters environments conducive to creativity and growth. Many analysts believe that encouraging competitiveness is the most effective method for improving customer well-being. Effective rivalry thus improves industry convergence and enhances European firms' performance in the common market and internationally (European Court of Auditors, 2018).

The Treaty of Rome, which defined the establishment of a mechanism aimed at protecting fair competition in the single market amongst its priorities in 1957, foreshadowed EU competition policy. The Treaty on European Union (TEU) specifies in Article 3(3) that perhaps the EU "shall create an internal market" focused on an "extremely dynamic social market economy."  Articles 101 to 109 of the Treaty on the Functioning of the European Union (TFEU) provide the guidelines for competitiveness in this market (Witt, 2018).

The philosophy of the internal market is founded on the notion that market players should be exempt from all (national) antitrust barriers and be able to operate with the greatest economic freedom necessary. The European competitiveness strategy seeks to ensure the proper functioning of the Single Market. It ensures, on the other hand, that enterprises work fairly in all Member States' industries. Efficient competition is a stimulus for a profitable internal economy, which stimulates growth and employment, rather than an objective in itself.

European competition laws are designed primarily to protect competition, avoid market failures, and securing financial integrity for market participants. The mechanism aims to ensure that policymakers and firms follow EU rules on fair competition, while still allowing for adequate room for creativity, unified internal sector standards, and the growth of small businesses.

EU antitrust laws refer to conduct or deals entered into outside the Union whether they affect the domestic sector. Finally, it is important to note that EU competition legislation extends to all Member States as well as the three other countries that include the European Economic Area: Iceland, Lichtenstein, and Norway. In the context of competition and employees, reference needs to be made to article 101 of TFEU.

The European Union's Court of Justice has widely known that collective bargaining for employees is below the framework of EU competition rules. Problems occur, though, as efforts are made to apply collective bargaining to classes of professionals that are not employers, at least officially, such as the self-employed. According to EU competition law, such practitioners are called "entities," and any arrangements they enter into (such as collective bargaining) will be subject to EU competition laws. It is difficult to determine the spectrum of the self-employed that must engage in collective bargaining. Self-employment practises are very diverse; they indeed can encompass a broad variety of activities, and their situation changes with time (European Commission, 2020). As a result, the European Commission is currently reviewing whether it is possible to implement EU-wide legislation to resolve the problems posed by this circumstance and strengthen the conditions of these persons.

Every day, millions of people and enterprises connect and transact with one another through digital business models such as social networking platforms, ride-sharing apps, and e-commerce storefronts. The merits of these points are presently being debated in both the United States and Europe, or if antitrust legislation can be adapted to counter them. Antitrust officials at the European Commission also appeared to favour shielding future rivals, even though industry giants have outperformed competitors and gained customer interest by ingenuity and clever acquisitions (Suominen, 2020). One result of this strategy has been recent European Commission prosecutions and multibillion-dollar penalties imposed on American giants such as Google Apple, and Amazon for allegedly breaking the policy laws that were incorporated by the European competition.

Conclusion

The essence of innovation in high-tech markets generates penetration obstacles and consumer power roles. High-tech companies also develop whole new markets for their goods, which they eventually conquer; at least before a competitor business comes along and threatens them. This transient market power, as well as the resulting earnings, helps to validate their significant expenditure in R&D. Forcing emerging firms to exchange their digital content to stimulate competitiveness would result in lower costs in the near term. However, if it eliminates opportunities for firms to invest and produce innovative goods, it would not be in the interests of innovation or the market in the long run.

References

Damro C., and Guay T. (2016), European competition policy and globalisation, Palgrave Macmillan.

EPRS, 2019. EU competition policy. [online] Europarl.europa.eu. Available at: <https://www.europarl.europa.eu/RegData/etudes

European Commission, 2020. Competition: The European Commission launches a process to address the issue of collective bargaining for the self-employed. [online] European Commission - European Commission. Available at: <https://ec.europa.eu/commission/presscorner/detail/en/IP_20_1237> [Accessed 3 May 2021].

European Court of Auditors, 2018. Enforcement of EU competition policy. [online] Eca.europa.eu. Available at: <https://www.eca.europa.eu/Lists/ECADocuments/BP> [Accessed 3 May 2021].

Ezrachi, A., 2018. EU competition law: an analytical guide to the leading cases. Bloomsbury Publishing.

Jones A. and Sufrin B. (2016), EU competition law, sixth edition, Oxford University Press.

Suominen, K., 2020. On the Rise: Europe’s Competition Policy Challenges to Technology Companies. [online] Available at: <https://www.csis.org/analysis/rise-europes-competition-policy-challenges-technology-companies> [Accessed 3 May 2021].

Witt, A.C., 2018. The enforcement of Article 101 TFEU: What has happened to the effects analysis?. Common Market Law Review, 55(2).

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