WRITTEN QUESTION E-1589/00

by Martin Callanan (PPE-DE) to the Commission

(19 May 2000)

Subject: Competition

Would the Commission agree that Subsection

4, Article 38, The Principle of Unity of Exploitation of the Tourism Planning Law for the Canaries, is clearly anti-competitive in view of the following:

1. In the establishments providing accommodation, the undertaking of tourist activity must be carried out in accordance with the Principle of Unity of Exploitation.

2. For the purposes of this Law, the term Unity of Exploitation will be understood as the need to accept one single nominative company per complex as far as tourist exploitation is concerned.

(The law, in effect prohibits individual owners from determining the cost of renting their accommodation and, furthermore, penalises those owners who wish to use the property for personal use).

Answer given by Mr Monti on behalf of the Commission

(20 June 2000)

The Honourable Member refers to a piece of the Canary Islands legislation; the Commission understands that the law in question is that of 6 April 1995, No 7/1995, concerning some rules for tourism services in the Canaries. The Honourable Member asks whether the Commission agrees that a particular provision is clearly anti-competitive. This provision requires, in substance, that there is one management and some common standards for renting out to tourists the apartments in one complex. The purpose appears to be to ensure the good quality of the service to the tourists. The pricing, however, as well as other such commercial aspects seem to remain outside the scope of co-ordination.

The Community competition rules (Articles 81 and 82 (ex Articles 85 and 86) of the EC Treaty) concern the elimination of agreements between undertakings which restrict competition (e.g. price-fixing agreements between competitors) and of abuses of a dominant position. The application of Article 10 (ex Article 5) or, in case of public undertakings and undertakings with exclusive rights, of Article 86 (ex Article 90) of the EC Treaty, in combination with one of the former articles, allows the Commission to intervene even in cases where a Member State imposes or encourages such behaviour. It however needs to be remembered that the Community competition rules can be applicable only if the alleged restriction is capable of producing an appreciable effect on trade between Member States.

While the Commission is willing to examine any complaint brought to its attention, it is unable, in the absence of any further detail, to share the view of the Honourable Member that the provision referred to is clearly contrary to the Community competition rules. It rather seems, on the basis of the information available, that the law is not liable to induce any anti-competitive behaviour that would constitute a violation of the Community competition rules.