20 January 2003 • Austrian Competition Policy: Quo vadis? • Michael  Böheim

Competition policy in Austria stands at the crossroads. After long years of lethargy, and their detrimental effect of having key segments of the Austrian economy labouring under high market concentration rates, Austrian competition policy has at last made a serious attempt to shake off its undeserved "wallflower" status, challenged by external as well as internal pressure to reform.

With its legal and institutional framework conditions recently updated, Austrian competition policy is now faced with the need to adapt to European standards governing handling and assessment of restraints on competition, further aggravated by the requirement to thoroughly revise its own policy objectives.

The prospect of an institutional reform of Austrian competition laws should be seen as an opportunity to put Austrian competition policy on an entirely new methodological and contentual footing. Exemplary models for this purpose are offered by the (at present itself reinventing) European Commission's Competition Directorate-General, as well as by other national competition authorities governed by a modern and more economics-based approach to competition.

In view of past deficiencies and failings in the field in Austria, it appears advisable in general to step up the pace of combating anti-competitive practices (cartels, anti-competitive mergers and abuse of a dominant position within a market). Even though the political will and practical capacity to repair past failures of competition policy appear to be limited in spite of the existence of legal tools, measures nevertheless need to be taken to ensure that an extremely stringent yardstick, based on a detailed economic market analysis, is applied in future assessments of restrictive practices. Most important will be the strengthening of preventive measures, e.g., closely monitoring high concentrated markets.

This ambitious agenda requires deployment of substantial resources both in qualitative and quantitative terms. As long as there is no remedy to this resource problem one should not expect that Austrian competition policy will work any better in the future.