Lianos: Probes from commission help boost competition

In an exclusive interview with BusinessDaily.gr, the president of the Competition Commission, Ioannis Lianos, talks about competitions issues relating to Greece: the closed economy, lack of innovation, business ties that create cartels, the picking up of market checks and the probes currently in progress. 

• G. PAPADOGIANNIS (BusinessDaily.gr): To begin with, I would like to ask you, before you took over the presidency, what was your image of competition in Greece, of the state of the markets in Greece? 

I. LIANOS: Thank you very much Mr. Papadogiannis, it is my pleasure to talk about issues that concern citizens and consumers. In general, the picture I had is that the market is relatively closed and in some areas of economic activity there is a culture of cooperation between companies, which, as you can understand, can create a background for cartels. An economy unfortunately, which did not have, at least until recently, significant signs of innovation and dynamic efficiency. If you look at the Greek companies, the first ten Greek companies in the 1980s, with those that are today have not changed. What does this mean? It means that we do not have, like other states and economies the dynamics, like Israel, for example, to name an example of a country that is relatively in our neighborhood and which has about the same population. We do not yet have companies that are from the fourth industrial revolution. That is, if you look at the ten largest companies in Israel in the 1980s and now they have a very different picture. There are technology companies. There are companies in various technological fields. It is something that unfortunately in Greece we have not achieved. There is a deficit in this area of dynamic efficiency, investment in innovation and which I believe is the focus of many problems that we have and had at the time I was thinking of returning to Greece. 

• Now after the experience, after two years from the position of president, having seen things from the good and the bad, let's say, what would you say about the competition in Greece? 

The same problems remain, although I believe that important steps have been made, at least in terms of the technology sector and especially with the development of some Greek unicorns, ie companies that have a capital value of more than one billion, which are technology companies. 

And I believe that enhancing competition is something that will drive these companies, motivate companies to invest in innovation. So, the opening of the market, the activity of foreign players in the Greek market and the possibility for these players to enter relatively easily, that is, with no barriers to entry - exit from the market, is something that we consider very important. On our part, we have acted specifically targeting those sectors of the economy where we believe there can be potential for significant improvement in innovation and dynamic efficiency, which is always to the benefit of consumers as well. 

The Commission as a point for the last two years has added to its focus consumer protection and that of protecting and promoting innovation. And this was done through our involvement with areas that had been left untouched for a very long time. We started, as you know, with the biggest on-the-spot check ever done by the Competition Commission on banks, so banking is one sector that we are very interested in. In fact, a special management team was created, with specialized personnel related to the financial sector. We also launched sector research for the Fintech industry, ie the use of technologies and the creation of technology companies and their activity in the financial sector. This survey will be published in the coming weeks and is the first survey conducted in this field by the Competition Commission. 

You mentioned earlier that the Greek economy remains closed and that there are significant barriers to entry for new companies. However, the opening of the markets was the main goal of the first memorandum. That is, we have been talking about it for ten years. Why do you think this attempt has failed? 

What I would like to focus perhaps more on now are obstacles that are not only regulatory but also stem from dominant business strategies or possibly cartels. So, this is the focus of the Competition Commission for the last two years and what we are doing is to invest, first of all, in the possibilities that the Commission has to be able to detect anti-competitive practices, a very important effort has been made to invest in technology. infrastructure, we have set up - we consider the Competition Committees in Europe one of the most pioneering in it - a platform for the collection and processing of big data and we have set up a support department for digital evidence. 

In the field of telecommunications, things are somewhat different. In the telecommunications sector, the Telecommunications Commission has the sole responsibility for regulating competition in advance, ie opening up the market in question, and enforcing ex-post competition rules, where the Competition Commission has no responsibility. This is a peculiar, peculiar regime compared to what is happening in the rest of Europe, where all the other Member States have a division of responsibilities which is about the same as the one I mentioned earlier for energy. In fact, it is us and Mexico in the OECD that have this peculiarity. This is something that concerns the planning of the responsibilities in general, it is ultimately a political decision on how we want to organize specific markets and it is something that I have personally spoken in favor of the fact that we need to integrate the European way of thinking and to proceed with changes and clarification of responsibilities. 

• Is there a similar concern in Greece that some large companies could take advantage of their position? 

There are many other platforms or large companies - I can give you examples in the tourism sector booking.com, Expedia, Airbnb - which are not subject to this regulation and to which national competition law could possibly apply in case, of course, they were pursuing anti-competitive practices.  

There are also non-digital businesses, because the idea of ecosystems was something that started in the digital economy but has now grown into non-digital markets, which are also trying to create these centers, go ahead and create business ecosystems. Banks for example, may be, may be large companies such as OTE or OPAP, which will spread outside the specific sector in which they operate to spread to various other services which is particularly positive because it gives a significant flexibility and also enables the big players to act as a center of innovation and to spread this innovation more widely in their ecosystem. But for this to go ahead and work for the economy, we need to avoid these players being able to abuse the reliance that other companies have on them and therefore work negatively on the innovation incentives that smaller companies have.  

Now, the Competition Commission under this legal framework can only act if these companies have a dominant position in a market. But many times we see that it is not necessary for a company like the ones I mentioned to have a dominant position in a specific market. The power they draw does not come from a market. It comes from their presence in many markets at the same time. So, a company may not have a dominant position in a market but draw power from its presence in multiple markets which are interconnected and from the ability it has access to end consumers. And this is exactly the gap in law we wanted to fill through this proposal we had made for ecosystems and the abuse of power in ecosystems of structural importance for competition in Greece. 

YIANNIS PAPADOGIANNIS