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Free competition is a key element of an open market economy. It stimulates economic performance and offers consumers a broader choice of better-quality products and services and at more competitive prices.

European Union competition policy ensures that competition is not distorted in the internal market by ensuring that similar rules apply to all companies operating within in it. Title VII, chapter 1 of the Treaty on the Functioning of the European Union lays down the basis for Community rules on competition.

State aid is prohibited under the Treaty, although exceptions exist because such aid may be justified by, for example, services of general economic interest. It must be demonstrated that they do not distort competition in such a way as to be contrary to the public interest.