Competition and Competition Policy Essay Example | Topics and Well Written Essays - 4500 words

Competition and Competition Policy - Essay Example As the essay discusses Blue Beer plc is an important producer of beer in Newcastle. Statistics shown that Blue Beer plc accounts for some 12% of all beer sold in the United Kingdom but that its Bluelite plc is especially successful and accounts for 40% of all non-alcoholic beer consumed in the UK. Blue Beer has been negotiating with County Beers Ltd with a view to merger. County Beers is the principal other producer of non-alcoholic beers and after merger the new company, British County Blue, will control 65% of the market in non-alcoholic bee. According to the paper findings the overall policy of the European Union of competitive practices is as follows – â€Å"In a free market, business is a competitive game. Sometimes, companies may be tempted to avoid competing with each other and try to set their own rules for the game. At times, a major player in the game may try to squeeze its competitors out of the market. The European Commission acts as the referee to ensure that all companies play by the same rules. This discussion stresses that markets started being highly competitive and this forced businesses to pursue ways and means to survive and grow. Price cutting, mergers and acquisitions, and formation of cartels began to be accepted as a way to keep away competition. Monopolies or monopolistic tendencies began to be seen in the market creating unfair competition for smaller players.