Kroes probes financial services and energy firms

By Aoife White

Date: 04/05/05

Competition inquiries into the financial services and energy sectors will be launched this month, opening the way to possible new antitrust cases.

European Competition Commissioner Neelie Kroes will ask her fellow commissioners to back two new sector investigations on 18 May.

The head of the Commission's competition directorate Philip Lowe said that the inquiries, which are expected to last 18 months, might trigger new antitrust cases.

In the financial services area, EU regulators will examine retail banking and retail financial insurance to try to identify possible barriers to competition.

The energy inquiry will focus on the electricity and gas sectors. Lowe said that the Commission wanted to find out whether regulation was the problem or whether the behaviour of private companies was to blame. Businesses that are found guilty of breaking EU antitrust law face fines of up to 10% of their global annual turnover.

Speaking this week at an event organised by the Friends of Europe think-tank, Lowe said Europe had to sort out its competition problems or aggressive foreign banks "would do it for us".

He said that some people claimed national psychology was to blame for the slow roll-out of internet banking. Officials needed to identify the reasons why the French, for example, were reluctant to pay their bills online, he said. He drew parallels with last year's sectoral inquiry into mobile telephony.

The investigation had found problems with "unfair and excessive" roaming charges for customers who made calls in Germany. In February, the Commission sent formal charges to German mobile network operators T-Mobile and Vodafone, claiming that European operators had to pay fees three times higher than German independent service providers for wholesale access.

Kroes has called on national regulatory authorities to tell the Commission if they come across regulatory barriers that hold back competition. She stressed that the Commission had "an open mind and constructive approach" to the inquiries. "Where we identify obstacles to competition - be it regulation, State aid, private barriers - we will propose solutions, working closely with national administrations, regulatory bodies and competition authorities," she said.

Article reports that the European Commission was planning to open two sectoral competition investigations into the financial services and energy sectors in May 2005, opening the way to possible new antitrust cases. In the financial services area, EU regulators intended to examine retail banking and retail financial insurance to try to identify possible barriers to competition. The energy inquiry was to focus on the electricity and gas sectors. European Competition Commissioner Neelie Kroes was planning to ask her fellow commissioners to back two new sector investigations on 18 May 2005.

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