Market and Government

A wide range of situations can be imagined where businesses face competition from governments. Some examples are: the operation of parking garages or bicycle sheds by municipal companies, the leasing of government-owned real estate, and music or sports education from a government institution. The Market and Government Act obliges governments to comply with a number of rules of conduct when carrying out these types of activities and thus aims to prevent unfair competition by governments.

These are the following rules of conduct:

• Integral costing: governments must at least include all integral costs of economic activities in the selling price.
• Favoritism prohibition: governments must not favor their own public companies over competing companies.
• Data use: governments may only use data obtained in the exercise of their public law powers for the exercise of economic activities if other organizations or companies have access to that data (under the same conditions).
• Prohibition of mixture of functions: if a government performs a certain economic activity and also has an administrative role with respect to that activity, it must ensure that the same persons are not involved in the administrative and the economic activity.

The Authority Consumer & Market (ACM) supervises compliance with the rules of conduct. The ACM can supervise on its own initiative, or act on complaints or signals from, for example, aggrieved companies. The ACM can declare by decree that it has found a violation of the rules of conduct or, if it believes that this is not sufficient, impose an order for incremental penalty payments to force the government to end the violation. Deterred business owners can also file a suit in civil court.

Banning Advocaten has particular expertise in Market and Government related issues. Our clients include both public authorities and companies.