Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

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Monday, January 3, 2011

The Applicability of Competition Law to the German Social Security System

Posted by D. Daniel Sokol

Christian Kersting, Heinrich Heine University of Duesseldorf - Faculty of Law and Sabine Faust, Heinrich-Heine Universitaet Duesseldorf - Faculty of Law analyze The Applicability of Competition Law to the German Social Security System.

ABSTRACT: During the last 20 years, the European Court of Justice (ECJ) repeatedly had to decide on whether the Member States’ social security systems are subject to European competition law. In these cases the ECJ was reluctant to apply the European competition rules in order not to interfere with the functionality of the Member States’ social security systems. Therefore, statutory health insurance providers were, for example, not considered to be undertakings in the sense of Art. 101 et seq. TFEU.

This article takes a critical view of this judicature, taking statutory health insurance providers as an example. An unrestricted application of the cartel prohibition in Art. 101 TFEU may on the one hand endanger the functionality of the social health-care system which to a certain degree requires cooperation. On the other hand, the German legislator has deliberately established room for independent decision-making of statutory health insurance providers and thus promoted competition between them. This form of competition deserves protection. It will be demonstrated that the apparently conflicting interests in cooperation on the one hand and in application of competition law on the other hand which both contribute to the functionality of the German health-care system can be balanced: Statutory health insurance providers have to be considered as undertakings and therefore as addressees of competition law. However, as far as the functioning of the health-care system requires cooperation, anti-competitive conduct in the sense of Art. 101 et seq. TFEU may be justified under Art. 106 para. 2 TFEU.

Furthermore it is argued that the German legislator is free to apply the German Act on Restraints of Competition (GWB) to anti-competitive conduct of social security providers. The ECJ’s judicature, according to which especially statutory health insurance providers are not considered to be undertakings in the sense of Art. 101 et seq. TFEU, is no obstacle in this regard. In the context of social security law Art. 3(2) Regulation 1/2003/EC does not require the term “undertaking” to be interpreted consistently in European and German law.

http://lawprofessors.typepad.com/antitrustprof_blog/2011/01/the-applicability-of-competition-law-to-the-german-social-security-system.html

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