Approval of draft decisions under Article 352 of TFEU

Part of European Union (Approvals) Bill – in the House of Commons at 5:39 pm on 10th October 2017.

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Photo of Bill Esterson Bill Esterson Shadow Minister (Business, Energy and Industrial Strategy), Shadow Minister (International Trade) 5:39 pm, 10th October 2017

I do not think there is any danger of confusing Donald Trump’s Administration or regime with anything of the hard left.

That Boeing can act as it has done—initiating trade disputes in a segment in which it does not compete—with the full support of a protectionist US Administration demonstrates the need to ensure that every effort is made to deliver healthy and fair competition. The reliance of some Ministers on the US for trade and for our own economic success has been brought into sharp focus by the actions of the Department of Commerce. Notably, this applies to the International Trade Secretary, who seems to think that our relationship with the US is the answer to all our prayers, but it clearly is not.

On Second Reading, the Minister told the House:

“The absence of the possibility of exchanging information with the Canadian Competition Bureau is regarded as a major impediment to effective co-operation. The proposed changes in the existing agreement will allow the European Commission and the Competition Bureau to exchange evidence that both sides have obtained in their investigations. That will be particularly useful in all cases in which the alleged anti-competitive behaviour affects transatlantic or world markets. Many worldwide or transatlantic cartels include Canada and, via Canada, the Commission will gain a good opportunity to have access to additional information concerning those cartels.”

I note that she also told us:

“The existing competition agreement with Canada does not allow the sharing of confidential information, but the new one does.”—[Official Report, 4 July 2017;
Vol. 626, c. 1048.]

Many people regard the actions of Boeing in pushing the US Department of Commerce towards levying 300% tariffs on Bombardier, a competitor with a technically superior product, as a pretty strong example of the type of anti-competitive behaviour that the Minister spoke about on 4 July. Indeed, given Boeing’s battle with Airbus, it very much appears to be an attempt to destroy further competition in a market in which it has long been the dominant player.

The Canadian Government and the EU have both been working hard to address the actions taken to reverse the protectionist, anti-competitive actions of Boeing and the US Government. I trust the Minister will agree that any action to help all those connected with Bombardier in the UK, who are now fearing the worst, would be widely welcomed. The European Commission has noted that the absence of a power to exchange information with the Canadian competition authority is now an impediment as co-operation between the two parties has increased. Co-operation between the Canadian Government, the UK Government and the EU has never been more important, and what is happening at Bombardier is a reminder that such increased co-operation can only help.

Fair competition means avoiding anti-competitive practices, whether at home or abroad, including through the creation of cartels, or through mergers and acquisitions that distort the market. The undercutting and exploitation of workers in smaller businesses, the use of zero-hours contracts, the creation of false self-employment about which workers have little choice, the unfair treatment of smaller businesses by banks that will fund only those with liquid assets and delays in the payment of invoices by larger firms are all examples of anti-competitive and exploitative practices. In relation to such practices, Governments should find ways of intervening, nationally and internationally, to create a level playing field. Governments should be the partner of business and of the workforce, and they should encourage those wishing to start and to grow a business.

Preventing competition from being undermined matters, so co-operation between competition authorities and the sharing of information between jurisdictions is a key part of preventing anti-competitive practices. There is an existing agreement between the EU and Canada on competition law. It provides for the reciprocal notification of cases under investigation by either party where such cases may affect the important interests of the other party. It provides for co-ordination of enforcement activities and the provision of assistance where both parties have an interest. It provides the ability of one party to request the other to take enforcement action if there is reason to believe that anti-competitive activities carried out on its territory are adversely affecting the other party’s important interests. It also provides for the exchange of information subject to confidentiality provisions and conditions of use, including on current enforcement activities and priorities, economic sectors of common interest, policy changes that either party is considering and other matters of mutual interest relating to the application of competition law.

Labour will seek for us to remain a member of common European agencies that benefit the UK, such as Europol, Eurojust and the Erasmus scheme. To those, we can now add having access to the information shared between the competition authorities in the EU and in Canada and, for that matter, between those in the EU and in other countries.

The emphasis from the Labour Benches is on jobs, the economy and retaining the benefits of the single market and the customs union. Being able to share information about competition, to prevent anti-competitive practices and support fair competition is consistent with maintaining the best possible relationship with the EU and access to our biggest customer as a country—the customer being the EU, which accounts for 44% of our trade.

On Second Reading on 4 July, the Minister told the House, in answer to my question whether the UK could remain part of the Fundamental Rights Agency after Brexit:

“The Government are looking at the UK’s relationship with all EU bodies, including the FRA, as part of the exit negotiations.”

Further to that answer, may I ask her, three months later, whether the Government have a view yet on whether we will remain in these EU bodies and, indeed, which ones we will remain in during transition, and secondly, whether the UK wishes to remain in these bodies after transition?

In answer to my questions about the competition arrangements, the minister told me on 4 July:

The UK Government will be free to enter into their own arrangements to share information with Canada directly, and the UK and Canada will need to negotiate any such agreement.”

I also asked about international agreements after the UK leaves the EU, and whether this agreement provides a model. She told me:

“The UK will be free to enter into international agreements on competition” and she told me that the Government

“believe that this agreement is a good model.”—[Official Report, 4 July 2017;
Vol. 626, c. 1074-75.]

Can she tell me what happens after we leave until new arrangements have been agreed? What transitional arrangements do the Government have in mind for sharing information about competition with Canada and other countries? Perhaps, following my comments about Bombardier, she might want to say whether, in her opinion, the sharing of information with the Canadian Competition Bureau might be of help in addressing the problems caused by Boeing’s actions and by the imposition of punitive tariffs and the return to protectionism that we have seen from the United States Government.