The number of subsidy measures implemented worldwide has in the recent years been steadily increasing. This may be a result of several factors, including recent developments that have required, and will continue to require, government intervention, such as the COVID-19 recovery, climate change, fragile and disrupted global value chains and the digital transformation. It is well documented that many subsidies influence competition and trade. They frequently distort the level playing field by changing market signals, resulting in inefficiencies, prices distortions and altered incentives. They also undercut support for open trade and can create global trade tensions due to sharp differences over how to deal with them.
One could therefore expect subsidies to be subject to the intense scrutiny of governments worldwide. This is however not the case, as the most important examples of controls on subsidies arise in international treaties (including the EU and WTO).
Against this background, in December 2022 the Global Forum on Competition held a roundtable discussion on the extent to which, and how, subsidies should be part of the competition analysis of competition authorities. Questions included:
- To what extent are subsidies currently incorporated by competition authorities in competition analysis?
- Should subsidies be incorporated (more or differently) into the competition analysis, and if so, why and how?
- What theories of harm may apply to subsidies, and what is the economic basis for these theories?
- What analytical techniques can be used to assess these theories, and what types of evidence are needed to use them?
This page contains all related documentation.
