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Competition, procurement and state aid

Competition

Fair competition is one of the cornerstones of our economy: businesses must be able to compete with each other on a level playing field. The aim of guaranteeing fair competition is to ensure that consumers pay a fair price for the goods and services they buy – and not through the nose simply because there’s only one supplier on the market or because a number of suppliers have fixed prices by mutual agreement.

Competition law prevents businesses from deriving an advantage from dominating a market, for example, or from making price-fixing agreements with each other. The domestic market in the Netherlands is subject to Dutch competition law, whereas all cross-border trade is subject to European competition law. 

Competition may also be restricted as a result of action taken by government bodies. There are two ways in which they can do this:

Procurement

First, government bodies can favour certain businesses, for example when buying goods or services or when awarding contracts for public works. Under EU and Dutch procurement law, all businesses must be given an equal opportunity to compete for government contracts.
Companies involved in a tender procedure are advised to take immediate action if they discover errors in the specifications for the project in question or in the procedure followed by the contracting authority. Any such problems should be reported immediately to the contracting authority, as the court will generally reject any complaint that is brought after the award of the contract. 

State aid

Government bodies may also give preferential treatment to a business by granting it a ‘soft loan’ (i.e. at a below-market rate of interest) or by awarding it an inefficient subsidy. These situations are not covered by the rules on procurement, however, as the loan or subsidy is not counterbalanced by a legally enforceable contract. They are subject to the legislation on state aid, on the other hand.

What can we do for you?

In order to prevent government bodies from restricting the free operation of the market, they are required to observe the legislation on state aid and procurement. Our lawyers are familiar with both these fields of the law and, more particularly, with the relationship between them. This makes them ideally placed to advise you on the best course of action to take if you believe that you have suffered as a result of the action taken by a government body. 

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