What is the CNMC?
The National Commission of Markets and Competition (CNMC) is the body that promotes and ensures the proper operation of all markets in the interest of consumers and corporations.
It is a public body with its own legal personality. It is independent from the Government and subject to parliamentary oversight. It went into operation on 7 October 2013.
Although the origins of the competition authority can be found in the Anti-Trust Court (1964), the National Competition Commission (CNC) was formally created in 2007.
A multitude of regulatory bodies emerged from the liberalisation of consumer industries, the end of state monopolies and the need to adapt to European regulations.
As a result, in 1995 the National Electricity System Commission (predecessor of the National Energy Commission, or CNE) was created, followed in 1996 by the Telecommunications Market Commission (CMT). In 2003, the Rail Regulation Commission (CRF) was created. In 2010, the State Council for Audio-Visual Media (CEMA) was created and the National Postal Sector Commission (CNSP) went into operation. The Airport Economic Regulation Commission (CREA) was created in 2011.
In 2013, the unification of the regulatory bodies and the anti-trust authority was approved in an effort to enhance their independence, provide legal certainty and institutional trust by adopting an inclusive view from a regulatory and anti-trust standpoint, the goal being to promote the modernisation of the economy to benefit consumers.
As a result, the six supervisory entities in existence at the time - National Competition Commission, National Energy Commission, Telecommunications Market Commission, National Postal Sector Commission, State Council for Audio-Visual Media, and Committee of Railway and Airport Regulation - were combined into one.
Previous Commissions merged to form the CNMC
The main purpose of the CNMC is to guarantee, preserve and promote the proper operation, transparency and existence of effective competition in every market and area of production for the benefit of consumers and users, as well as to ensure efficient regulation.
The CNMC is subject to parliamentary oversight, which guarantees its independence and underpins the legal foundation of its actions, which are included in the rulings approved by its Council.
What are its functions?
How is it structured?
The CNMC exercises its functions through two governing bodies: the Council and the President, who also chairs the Council.
The Council is the CNMC's collective decision-making body. It consists of ten members appointed by the Government, nominated by the Ministry of Economic Affairs and the Digital Transformation. These nominees are individuals of renowned prestige and professional competence in the Commission's area of activity. Their appointment must be approved by the Spanish Parliament's Commission on Economic Affairs and the Digital Transformation, which considers their suitability and any potential conflicts of interest.
Their term lasts 6 years, is not renewable and is subject to strict eligibility requirements. The Council can act as a single body or through a committee. To this end, it is organised into two committees: one devoted to competition issues (Competition Committee) and the other to monitoring regulated sectors (Regulatory Supervision Committee). The Plenary is made up of all the Council members and is chaired by the President.
The CNMC also has four investigatory directorates (Competition, Energy, Telecommunications and the Audio-Visual Sector, and the Transport and the Postal Sector) that report to the President. These duties are supplemented by the Competition Promotion Department and an Internal Control Department, which oversees the cases.
How does it work?
The CNMC operates in compliance with European Union regulations, especially in the energy, telecommunications, audio-visual, transport, postal and anti-trust sectors. All of them are working toward greater integration of the Union's Single Market.
To this end, the Commission collaborates regularly with other European Union supervisory authorities and with the cooperation agencies of European regulators in the various matters within its purview.
The Competition Directorate is assigned the investigative functions set forth in the Anti-Trust Law, which continue to be exercised maintaining the consistency and horizontal nature of the anti-trust regulation.
In an effort to guarantee the independence of their actions, the Competition Directorate and the other three investigative Directorates (Energy Directorate, Telecommunications and Audio-Visual Directorate, as well as the Transport and Postal Sector Directorate) carry out their investigative functions independently of the Council and cannot receive instructions from the Government.
What is the purpose of efficient competition and regulation?
For you, as a buyer and consumer of goods and services, competition between sellers helps you to have more options with better quality at lower prices.
For you, as an entrepreneur, free competition ensures equal opportunities in the market, such that the success of your business will depend on your ability, effort and innovation and not on the roadblocks or limitations imposed by other actors with greater market power or that engage in illegal conduct.
For you, as a citizen, competition serves to make national production more competitive in the world and in your own country. Oversight also guarantees transparency in the proper operation of the markets and compliance with the applicable laws.
How are regulated sectors supervised
Along with the anti-trust duties that are entrusted entirely to the CNMC, this body exercises functions in certain sectors and regulated markets where the application of anti-trust laws is insufficient to guarantee the existence of effective competition.
These sectors or areas are: electronic communications and audio-visual communication; the electricity, natural gas and renewable energy markets; the postal sector, airport tariffs and the railway sector.
The CNMC's functions in the aforementioned sectors include supervision and control, as well as broad conflict resolution powers.
What can the CNMC do to improve competition and efficient regulation?
- Investigate and sanction anti-competitive practices based on complaints or on its own initiative.
- Make recommendations to improve the conditions of competition in the various markets.
- Authorise and monitor mergers or concentrations of companies.
- Supervise the conduct of companies operating in regulated markets, by processing and deciding, as appropriate, disciplinary procedures for practices contrary to the regulation of economic sectors.
- Advise with non-mandatory recommendations to the public sector before standards are approved.
Promote the values of efficient competition and regulation.
- Help to ensure market unity, where appropriate, by filing special administrative appeals in defence of said market unity.
- Oversee the application of regulations in the energy, telecommunications, audio-visual, postal and transport sectors.
- Enforce the proper operation of and eliminate obstacles in the domestic market through the Market Unity Law.
- Analyse the regulatory proposals made by governments to ensure they comply with the principles of efficient competition and regulation, with the capacity to challenge regulations that are not enforceable as laws.
Some anti-competitive actions and practices
- Several companies agree not to compete on their pricing, abusively fixing the same purchase or sale prices.
- A company unjustifiably imposes prices or other purchasing conditions on different purchasers of the same goods or services, placing some of them at a disadvantage compared to their competitors.
- A company forces a buyer to accept obligations that are unrelated to the transaction, such as not buying from a competitor, purchasing another product, etc.
- A company unjustifiably establishes exclusive sales areas for its distributors.
- One or more companies artificially hinder new competitors from entering the market.
- An administration dictates norms or approves resolutions that violate or impede market unity.
How is a complaint submitted?
Complaints for anti-trust practices or for violating the regulations that are applicable to the operators of regulated markets that are subject to CNMC oversight can be filed by any natural or legal person, public or private, national or foreign, that is aware of a violation of the laws that are enforced by the CNMC.
Written complaints are delivered to the CNMC registry, and must accurately describe the alleged anti-competitive behaviour or conduct that is contrary to the applicable laws that the complainant is aware of, identify those responsible and provide any available evidence.