In March 2012 the Ministry of Employment and the Economy announced that it was considering the possibility of merging the Competition Authority and the Consumer Agency. A report recently published by the ministry indicates that the ministry has now decided to support the merger. A government bill for the combined new authority will be issued after the summer and the combined authority could become operational at the beginning of 2013.

According to the ministry, the merger is warranted by the need to make cost savings in the public sector, as it is expected to streamline the administration of the two agencies. The ministry also aims to increase the social impact of the combined authority.

There are no immediate plans to change the statutory tasks of the two agencies. However, the report notes that the European Commission will prepare new public procurement directives later this year, which are expected to propose a national supervisory authority in this field. At present, Finland has no supervisory authority in public procurement matters. In its report, the ministry has stated that in many European countries, this type of authority already exists and is typically attached to the competition authority. The Finnish Competition Authority has not volunteered to take on new responsibilities – partly because it fears that it will not receive sufficient additional resources. However, with the more efficient combined authority, the ministry may be paving the way for new duties.

The speed of the merger process has been criticised, as the parties that were consulted feel that they did not receive sufficient background information. Some of the parties heard by the ministry raised concerns about how the different roles of the competition and consumer agencies will be maintained in the new combined authority. On the other hand, there were hopes that the combined entity could adopt a more coherent approach to larger issues.

At the beginning of 2012 the Competition Authority received supplementary funding to create a new Cartel Enforcement Unit to combat the grey economy. In its press release, the authority stressed that the unit will commence work during the summer as planned. Some new research officers have already been recruited.

At the same time as the structural reforms, the ministry was given the task of preparing a programme to promote sound and effective competition. The programme is expected to respond to the challenge of insufficient competition (eg, in the retail trade and construction sectors), which has allegedly raised price levels and reduced incentives for innovation. Juhani Jokinen, the director general of the Competition Authority, has been appointed to head the programme from May 1 2012 to April 30 2013. In view of the ongoing changes, Timo Mattila has been appointed as temporary director general of the Competition Authority and looks set to have a busy year.

For further information on this topic please contact Hanna Laurila at Dittmar & Indrenius by telephone (+358 9 68 1700), fax (+358 9 65 2406) or email ([email protected]).