- May 7, 2014
- Posted by: essay
- Category: Term paper writing
The competition is extremely important for the stable development of economy, while the fair competition is a key to the successful economic development because the fair competition creates equal conditions and opportunities for all companies operating in the market. The violation of the principle of the fair competition leads to misbalancing of the market and provokes economic problems because the misbalanced markets cannot develop effectively. The violation of principles of the open market economy and fair competition put companies in an unequal position. In such a situation, consumers suffer from the unfair competition because the unfair competition often leads to the deterioration of the quality of products and services, exorbitant and unfair pricing policies, and other negative effects which affect consistently consumers and economy at large (Aliso & Sufrin 2007). This is why the EU aims at the prevention of the unfair competition. For this purpose, the EU has developed the competition law which aims at the maintenance of the fair competition and prevention of any manifestation of the unfair competition practices. In fact, the EU competition law aims at the prevention of such unfair competition practices as was the case of AMD depicted in The Informant (2009), the film that shows the rise of the corporation using unfair competition practices. At the same time, the EU competition law welcomes the behavior of executives similar to that of Whitacre because the EU welcomes informing law enforcement agencies and regulating bodies about unfair competition practices to prevent them. At the same time, the EU competition law aims at the elimination of policies conducted by the AMD’s board of directors because these policies lead to the unfair competition and put the AMD into an advantageous position in the market allowing the company to reap off the high profits at cost of other companies and consumers.
On analyzing the EU competition law, it is important to point out that the EU competition law focuses on the creation of equal conditions for all companies and the maintenance of the fair competition. In the EU promotes principles of the open market economy, which incorporate the principle of the fair competition as one of the milestone principles of the open market economy. In such a situation, the EU naturally attempts to eliminate any threats to the fair competition in the EU. The EU attempts to make its economic policies and policies of companies operating in the EU transparent and fair. The fair competition is crucial for the EU because the fair competition defines the overall progress of the EU economy. The violation of the principle of the fair competition is a strategic threat to the economic development of the EU because the unfair competition misbalances the EU economy and puts some companies in an advantageous position compared to others. Naturally, the EU cannot accept such practices and limits attempts of the unfair competition through its competition law.
However, the EU competition law comes into clashes with the contemporary economic system which promotes the monopolization of the market to take the dominant position and take the full control over the market, while cartels and other unfair policies are steps toward the monopolization of the market by companies. Contemporary companies, such as the AMD, are profit driven solely. Therefore, they pay little attention to ethical concerns and benefits of consumers or other companies. Instead, they attempt to maximize their profits, while the unfair competition allows companies to increase their profits substantially. At this point, companies, such as the AMD, introduce unfair competition policies to take advantage of their marketing position and increase their profits at cost of rivals and consumers (Soderbergh, 2009). As a result, the AMD maximizes its revenues, while competitors turn out to be in a disadvantageous position and consumers have to pay for the unfair policy conducted by the AMD and alike.