Competition Law in Italy The first 20 years of law and practice

supply of the wholesale electricity market. Following a referral from the Italian Gas and
Electricity Authority, the Competition Authority had opened an investigation into an alleged
abuse of dominant position by Enel. The Competition Authority’s preliminary findings in
the decision opening its investigation were that Enel had leveraged its pivotal position on the
Macro-Area Southern Italy, raising its rivals’ costs by altering the price for export or import
of electricity to and from other Macro-Areas within the national territory. Enel proposed
commitments, which the Competition Authority market tested by seeking the views of
interested third parties (competitors, customers, traders, wholesalers) as well as of the Italian
Gas and Energy Authority. The third parties claimed that Enel’s commitment to sell for two
years virtual power plant capacity (VVP) was insufficient to eliminate the Competition
Authority’s initial concerns largely based on Enel’s position in the market. Indeed, the third
parties challenged the core elements of the commitment proposed. They suggested a
stronger one such as the sale of physical capacity. They also indicated that the commitment
should be of a much longer duration, suggesting as adequate a commitment of undetermined
duration that would last until the competitive structure of the market was such as to prevent
Enel’s abusive conduct. Similar observations were submitted by the Italian Gas and Energy
Authority. Ultimately, Enel submitted a set of modified commitments, reflecting in part the
comments made to the earlier set of its commitments, which the Competition Authority
accepted. The second set of commitments proposed by Enel were not subjected to a new
market test. In the decision closing the proceedings, the Competition Authority
acknowledged that the commitments were indeed incapable of removing Enel’s dominant
position. However, it also noted that they were strong enough to restrict Enel’s interest in the
short run to exert its market power by driving up the electricity price in the Power Exchange.
The duration of the commitment was finally limited to two years, although the Competition
Authority reserved its right to reopen the investigation should it observe any change in the
underlying factual situation or should Enel contravene to the obligations it had undertaken.
This first commitment decision is paradigmatic of what can be described as the
Competition Authority’s now prevailing practice with regards to this new type of decision.
Though the market test was largely negative, including negative views expressed by another
independent Authority with sector-specific regulatory competence, the Competition
Authority ultimately considered sufficient and accepted commitments that included
seemingly minor modifications relative to what the views expressed in the course of the
market test would have considered sufficient. Based on the first two and half years of
practice (Fall 2006 to Winter 2009), this sort of outcome is not unusual. Also, it has now
become a common practice for the Competition Authority not to market test any amendment
or improvement to the commitments initially offered by the parties under investigation.
In Ordine dei medici veterinari di Torino, 543
543 Ordine dei medici veterinari di Torino, 21 Feb. 2007, n. I668, Bulletin 8/2007.
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the Competition Authority accepted
numerous commitments from the Veterinarians’ Association of Turin and the Italian
National Federation of Veterinary Councils. It has thus closed an investigation prompted by
a veterinary who had been subjected to disciplinary measures for not applying minimum
fees and for advertising his services. The commitments included the removal of restrictions