Competition policy of the state: implementation problems and recommendations for improvement

Abstract

Problem setting. Changes in the socio-economic development of the country, caused by geopolitical, technological, economic and social factors, create new challenges for the competition policy of the state. The COVID-19 pandemic added to this list, significantly affecting the activities of the business environment, households, and the world economy in general. The development of an effective competition environment in commodity markets is a prerequisite for the restoration of stable economic growth on the basis of innovation and investment development.In this regard, there is a need to rethink the mechanism and set of instruments of competition policy on their adequacy to the current situation, their effectiveness and ability to ensure the achievement of goals and objectives. Nowadays, the emphasis of competition policy is changing, caused by changes in the competition environment and the objectives of economic policy in general. At the same time, the formation of competition policy should take place as a holistic system of influence by public authorities on the activities of economic entities and commodity markets in accordance with national goals and priorities of socio-economic development.Recent research and publications analysis. The works of Ukrainian and foreign scientists, including V. Lagutin, Z. Borysenko, A. Gerasimenko, G. Filyuk, K. Kantur, T. Shvydka, Y. Yasko, T. Shcherbakova, M. Porter, O. Kilievich and others.are devoted to the study of theoretical and applied principles of competition policy.Highlighting previously unsettled parts of the general problem. Despite significant developments in competition policy, there are still crucial problems to solve regarding the mechanism, tools and methods of competition policy, considering the socio-economic changes in society, changes of the emphasis in its implementation, given the existing problems, dynamics and structure of violations of competition law, the need for coordination of competition policy with the entire system of state regulation of the national economy and adaptation to competition practices in developed countries. Therefore, further research is needed to improve the state’s competition policy in the face of new challenges.The main purpose of the article is a theoretical study of competition policy, identification of the main problems in the implementation of competition policy on the basis of analysis of the Western Regional Territorial office of Antimonopoly Committee of Ukraine and formulation of recommendations for their elimination.Paper main body. Competition policy is one of the most important and complex forms of economic policy of the state. In its content, it is much broader than antitrust regulation, as it aims not only to limit and terminate monopolistic practices, anticompetitive agreements between economic entities and government actions, but also to develop and maintain effective economic competition, including through the application of competition law.Nowadays, the main focus of the state’s competition policy is to strengthen its preventive nature in order to promote fair competition, as well as to end the monopolistic behavior of both enterprises and public authorities.The most important principles of competition policy, which are mainly reflected in the current legislation and correspond to the best world practices are: improving the welfare of society; flexibility of competition policy; increasing the competitiveness of the national producer; promotion of entrepreneurial activity; creating opportunities for access to the benefits created by natural monopolies; coordination of the state’s competition policy with the priorities of economic policy and the goals of state regulation in general.Analysis of antitrust authorities showed that in the total number of violations of competition law the largest share are anticompetitive concerted actions of economic entities, violations in the form of anticompetitive actions by government, local authorities, bodies of administrative management and control, which significantly reduce the effectiveness of competition policy of the state at all levels.An actual problem in the implementation of state competition policy is to ensure equal conditions for all business entities, regardless of the type of ownership. This is due to the fact that most commodity markets in Ukraine are characterized by the presence of state-owned enterprises. Thus, according to the OECD and the World Bank (as of 2018), approximately 19 commodity markets in Ukraine have at least one state-owned enterprise; The number of utility companies is constantly increasing: at the beginning of 2021, 14,174 of them were registered in Ukraine, which is 22% more than in 2018.A reflection of the existing problems is the discrepancy between the amounts of fines imposed by the regulator for violating competition law and the amounts of fines actually paid. Thus, for the period of 2017-2020, the Western Regional Territorial office of Antimonopoly Committee of Ukraine imposed fines for violation of competition law in the amount of over UAH 95 million, and in fact UAH 11219543 was collected from violators, which is only 11.8%. The factors of this situation are: imperfection of legal norms and insufficient justification of penalties for business entities; low competitive culture of market participants, low responsibility of violators of competition law and “commitment” of government officials to some of them; lack of effective motives to prevent anticompetitive actions in economic activities, and lack of support and development of competition in commodity markets.Among all areas of state competition policy today, we consider the protection of competition and demonopolization of potentially competitive and monopolistic markets to be the main ones. In order to prevent collusion and counteract cartel agreements, it is necessary to establish effective interaction between the regulator and law enforcement agencies, expand the powers of the AMCU to inspect business entities, and introduce competitive conditions at all stages of public procurement. The control, transparency and targeting of state aid, as well as the cessation of discrimination in the actions of public authorities, are the key to ensuring the equality of economic entities, especially in the face of the challenges posed by the COVID-19 pandemic. Termination of unfair competition practices based on fair competition advocacy.Conclusions of the research and prospects for further studies. The main task of the state’s competition policy is to ensure the effectiveness of competitive relations in commodity markets, which leads to increased competitiveness of the domestic economy. All instruments and mechanisms of state competition policy should be used solely to develop effective competition in commodity markets. Competition policy, adapted to modern requirements and challenges, should encourage competition between producers, which will improve the quality of goods, services, the formation of economically reasonable prices and reduce them, and thus increase the level of satisfaction of society’s needs.The main instruments of competition policy should be preventive measures, strengthening the level of responsibility of economic entities for violations of competition law, as well as competition advocacy aimed at forming a competitive culture of market participants, the predominance of the principles of fair, transparent competition.