SICILIAN REGIONAL TRADING REGULATION
PRESS RELEASE
PRESS RELEASE
THE COMPETITION AUTHORITY HAS REPORTED ANTICOMPETITIVE PROVISIONS IN A SICILIAN REGIONAL GOVERNMENT TRADING REGULATION
The Competition Authority has submitted a report to the President of the Sicilian Regional Government, the President of the Sicilian Regional Assembly, the Minister of Productive Activity and the Minister of Regional Affairs, which was adopted at its meeting on 1 July, in which it pointed out two aspects of the trading regulation issued by the Sicilian Region, which are likely to hamper competition.
The first aspect was the fact that the market share of the applicant company had to be considered among the criteria to be met (in addition to aspects relating to the planning/environmental impact) for the grant of a permit to open, transfer or extend large retail outlets.
Decree 165 of 11 July 2000 issued by the President of the Sicilian Region entitled "Directives and guidelines for commercial planning and criteria for planning urban commercial premises", in implementation of Regional Law 28 of 22 December 1999 - The Trading Reform Act - provides that the applicant company may not have more than a one-third maximum market share, above which authorisation may not be issued. The Sicilian Regional Law therefore requires a kind of antitrust evaluation to be made, which is wholly improper in this context and is based at all events on criteria that have no basis in Italian or Community competition legislation or case law, which at all events falls within the exclusive domain of national legislation.
In its report, the Competition Authority pointed out that since this regional law might prevent the growth of companies and the pursuit of economies of scale that could be to the benefit of consumers, it was likely to unjustifiably distort competition.
The second aspect it raised was the fact that this Sicilian regional regulation imposed restrictions on the issue of new permits for large-scale retail outlets by setting maximum percentage increases of their overall floorspace.
These limitations and restrictions on the issue of permits were set down in the regulation of 11 June 2000 issued by decree of the President of the Sicilian Region for a transitional period of 30 months from the date of the entry into force of Regional Law 28/99. However, the transitional period was subsequently extended, without a time limit, by Regional Law 16 of 30 October 2002 enacting Provisions for small-scale industry, trade, co-operation and fisheries.
It being the case that seeking to balance the market by programming the structure of the supply hampers market development and unjustifiably interferes with competition, the Competition Authority objected to the extension of the transitional period, during which any new commercial initiatives could be prevented by the application of these quantitative restrictions for the grant of permits.
Lastly, the Authority reiterated the approach that it has expressed on many occasions, that only regional measures regulating the siting of commercial activities based essentially on town planning considerations may be considered to be consistent with the principles of competition protection, so that such regulation does not merely maintain the existing structure of competition, hampering any stimulus to competition which would be to the detriment of consumers.
Rome, 16 July 2004