Legal restraints when doing Business in Europe? An assessment on Competition Legislation on Vertical Relations in the European Automotive Industry
CompetitionAutomotiveCompetition legislationVerticalB2bBusiness to bussinesManagement of enterprisesFöretagsledningManagementBusiness and Economics
Purpose: The purpose of the investigation is to give an insight to hot the EU legal environment in the field of vertical relationships influences the competitiveness of the 2nd tier of the automobile industry. Conclusion:It follows that European legislation has succeedded in raising the competitiveness by breaking down the powers of the predominantly more powerful companies that the 2nd tier players do business with and by giving companies sufficient leeway to act. The comment must be made here that serious problems due to a power misbalance might still exist yet are not uncovered. In the course of my research I have found a lack of issues in my subject field. These problems however would have a more structural and economical cause, dealing with these problems would fall outside the boundaries of the competence of European competition legislation. Although criticism on the legislation does exist, it should be interpreted more as a balancing counterforce than as uncovering a sincere problem. Main point of relevant criticism is that the companies constantly have to remain aware of whether they still comply with legislation. The relatively high complexity and changing market shares lead to uncertainty and continuous legal costs. The ?innovator problem?, which addresses the issue of innovating firms gaining a too large market share according to European legislation can be concluded not be a practical issue, despite theoretical legal indications in that direction.