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State aid and distortion of competition - Sir John Vickers, Chairman, OFT

14 July 2005

Speech to the state aid conference

Download State aid and distortion of competition (pdf 130 kb)

By Sir John Vickers
Chairman, Office of Fair Trading

In this speech, given at the UK Presidency event on EU plans for reform of state aid today, John Vickers argues the case for better subsidy discipline at both Commission and national level. Subsidies that distort competition impose direct and hidden costs upon the economy, maintaining inefficient firms at the expense of more efficient firms and consumers, and blunting firms' incentives to become more efficient or innovative. A robust economic-based approach is needed at both EC and national level, with a potential role for national competition authorities in scrutinising state aids. 

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