Modalities of Co-Operation and Coherence between Competition Authorities and Sector Regulators

Modern competition rules are typically intended to safeguard the competitive process, as an instrument for pursuing broader economic goals, such as contributing to improve consumer welfare and ensuring an efficient allocation of resources. For this purpose, it is the responsibility of the authorities entrusted with the task of applying these rules to attempt to correct distortions obstructing competition, not to substitute the market mechanism itself. That is to say, competition law is process-oriented (safeguarding the competitive process with outcomes being determined by unrestricted competition), whereas regulation is typically result-oriented (with regulators defining desirable outcomes and directing market players in that direction). This paper discusses the different models under which coordination and coherence can be achieved between sector regulation and competition law enforcement, with a particular focus on the Portuguese legal regime established by the 2003 Competition Act. It concludes that recognition of the importance, if not indeed the primacy, of competition as a principle that underlies the modern market economy and as a parameter of public intervention in the market does not put into question the existence of regulators or imply their absorption by competition authorities, quite the opposite. The stronger, more independent and effective sector regulators are, the more effective the role of a competition authority will be. It is true that, where possible, when effective competition can be guaranteed by ex post control, the grounds for a priori regulation cease to exist, as the latter is always more intrusive and more restrictive with regard to economic freedom. However, there is and will continue to be ample room for regulation