Should the Bundeskartellamt be equipped with a tool to break up dominant companies or not? This issue was discussed by the Working Group on Competition Law which met in Bonn on 7 October 2010, at the invitation of the Bundeskartellamt.

The annual meetings of this group deal with fundamental and topical issues of competition policy. The group mainly consists of university professors from economic and legal faculties as well as judges from the cartel divisions of the Düsseldorf Higher Regional Court and Federal Court of Justice.

The focus of this year's discussion, led by the Vice President of the Bundeskartellamt, Dr Peter Klocker, lay with the ministerial draft bill introducing the instrument of divestiture presented at the beginning of the year. This instrument is intended to strengthen and complement the powers of the Bundeskartellamt. The bill envisages including, as an ultima ratio, in the Act against Restraints of Competition (ARC) the possibility of divesting undertakings active on markets which are of significance for the overall economy and whose dominant positions have a considerable impact on competition.

Other competition regimes in Europe and in the USA have had many years of experience with similar instruments. Ms Celine Gauer, Head of the Energy and Environment Antitrust Unit, DG Competition, explained the method of procedure of the Commission, which in the recent past has obliged large energy companies such as E.ON, RWE and ENI to undertake structural measures such as the transfer of production capacity or divestiture of transport networks.

Peter Freeman, Chairman of the British Competition Commission, described the advantages of a divestiture instrument, using a current case in which this was applied as an example. His authority is currently occupied with the divestiture of the airports in Great Britain, in particular the three London airports, which were all in the hand of the British Airports Authority.

Prof Dr Justus Haucap, Chairman of the Monopolies Commission pointed out in his speech that the instrument would fit in well in the German competition policy system at least from an economic view and pointed out its close connection with merger control. Although the investment decisions of companies could be hampered by the Bundeskartellamt's divestment powers, this problem could ultimately be solved by way of adequate rules for compensation.

The speech given by Prof Dr Wulf-Henning Roth of the University of Bonn focused on the critical evaluation of the ministerial draft bill seen within the context of the European legal framework.

The basis for discussion was a Bundeskartellamt working paper on the conference topic, which is available (only in German) on the Bundeskartellamt's website.