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“Technological progress in certain markets means that regulating economic activities now needs to be periodically reviewed. Regular adoption of the Competition Law would make economic liberalisation a more fluid, continuous process.”

Telos: The 2009 Development Law established that every year a Competition Law to be adopted. In the coming weeks the Draft Law for the market and competition will be finally approved by Parliament after having been the first one presented by the government. What do you think about the upcoming State upcoming law?

Giovanni Pitruzzella: I have nothing but appreciation for the government for tabling this law for the first time. As we all know, since 2009 our advocacy activities now include being able to express an opinion about the annual competition law. This option is used every year by the Authority to convey its technical input to Parliament and the Government regarding the elimination of regulatory or administrative obstacles hindering the opening of markets, thereby paving the way for the promotion of competition and ensuring consumer protection.
The draft law undoubtedly moves in this direction and affects many important sectors of the economy, especially the electricity market, the distribution of insurance, telephone and banking services, the pharmaceutical sector and professional activities. That said, although the draft law was heatedly debated, the current text does not contain all the original proposals; I sincerely hope that the final text can be further improved by successfully bearing in mind consumers’ needs and expectations. Technological progress in certain markets means that regulating economic activities now needs to be periodically reviewed. Regular adoption of this tool would make economic liberalisation a more fluid, continuous process.

Although the State has exclusive legislative authority regarding competition protection, the competences assigned to the Regions in many fields (such as energy and the transportation network) could lead to a rather fragmented regulatory framework. To what extent do you think this hinders competition? What can the Italian Antitrust Authority do to solve the problems that might ensue from this institutional and regulatory pluralism?

The Antitrust Authority has always kept a close eye on local markets and the activities of the Regions so as to counteract regulations and interventions aimed at limiting competition. One rather sensitive issue is the slipperiness that exists at local level: when budgetary constraints regarding economic activities in the service sector have been eliminated by the national legislator they are often reintroduced by the Regions either as a regulation or as peripheral administrative acts. In order to ensure coherent application of the competition principles enshrined in our legal system we have reinforced the tools used for this purpose. Since draft law n. 1/2012 entered into force assigning new consultative competences to the Antitrust Authority, the Prime Minister’s Office has received 244 requests for an opinion about regional laws; in 39 cases the Authority decided they represented a violation of competition principles.
I should emphasis that the principles established in the judgements of the Constitutional Court greatly reinforce the advocacy interventions by the Authority, thereby enhancing both its traditional consultative activity and its new powers, including the power to dispute the administrative acts of former art. 21-bis”.

Since 2012 the AGCM assigns a legality rating to companies that submit the application; the goal is to encourage companies to adopt ethical principles. What’s your opinion about the recent boom in requests for this legality rating?

I’d like to answer this question by citing Calvino who in his book “A Defence of Honesty in the Land of the Corrupt” (1980) described Italy as “a country that ran on illegality. There were laws, of course, and the political system was based on principles that everyone more or less claimed to share. But as it branched through many power centres, the system demanded unlimited financial resources and these could only be obtained illegally”.
Nevertheless, according to Calvino a category of honest citizens did exist: “due to mental habit, conditioning, or nervous tic; that is, they couldn’t help it if the things that mattered to them could not immediately be measured in money, or if their brains still operated by a worn-out mechanism that linked material gain to work performed, or social esteem to merit, or personal satisfaction to the satisfaction of others”.
The legality rating was established to achieve that goal: to seek out honest people and turn them into the engine behind the economy and a model to follow. But to be truly effective the rating cannot be based only on a company’s honesty, it must also be economically convenient. The company must know that if it respects the law and helps to blow the whistle on the more serious offences that make economic activities opaque and slippery then it will be awarded the legality certification and reap benefits such as access to credit and public financing.

Four years ago you were named President of the AGCM. It’s time to take stock: what are the positives and negatives?

The Antitrust Authority is going through a radical revamping process which inevitably affects its set-up. Although eliminating anti-competitive practices has traditionally been its core business, our mandate is now much broader and includes removing the bottlenecks that stop the economy from growing and the competition market from producing its effects in terms of efficiency and innovation. Our experience of the past twenty years tells us that insufficient competition in several markets is not only a cost for consumers and businesses, but also one of the main reasons behind the underdevelopment of our national productive fabric as well as an obstacle to growth. This is what prompted the legislator to give us these new tasks, including those cited in former art. 21-bis. The Antitrust Authority now has a completely new role: it interfaces with Public Administrations to remove the actions and practices that hinder competition for and in the market.
And then there’s the much greater role of the consumer. Emphasising consumer protection is even more important during this very long crisis that has made labour and economic growth – so crucial to create employment - a key issue of the political agenda. Protected consumers who are aware of their rights help to create an atmosphere of trust in the market, something that up to now has been not only one of the major stumbling blocks vis-à-vis economic recovery, but also one of the elements that has sparked the dangerous deflation threatening the European economy.