Figthing Against Restrictions to Competition in the Professional Services Market

By Francisco Marcos (IE Law School)

This paper reviews the latest developments in Spanish Antitrust Law concerning competition in the market for professional services. In the 90’s, following its 1992 Report on the freedom of practice of professions, the Spanish Competition Court (hereinafter CC) has gone through many of the existing restrictions on the competition by licensed professionals. The CC considered that most of them were not defensible following the new antitrust Law of 1989 (Ley 16/1989) and the constitutional principle of free competition (article 38 of the Spanish Constitution of 1978). In 1997 a change in the Law (Ley 7/97, of 14 April) provided legal basis for a new analysis by the CC of licensure requirement s and other obstacles to professional competition in fees and advertising. In the last few years lawyers, dentists, medical doctors, real estate conveyancers, architects, engineers, and other professionals have seen how their rules were struck down by the CC. Mandatory fee schedules have been prohibited, and advertising and marketing activities by professionals are now permitted. Several geographical restrictions to the practice of professionals have also been repealed. Besides, most of the CC’s resolutions have been confirmed by ordinary courts. After reviewing the CC’s resolutions on restrictions to competition in the market for professional services, the paper develops a general framework within which those resolutions should be placed. It is true that there are certain circumstances (information asymmetry, uncertainty, external effects, etc.) that pervade the market for professional services and which recommend the adoption of special rules regarding competition in such market. Certainly, consumers may require further protection when dealing with a professional, they are in a much lower position, relying in the diagnosis and treatment provided by the professional. Some rules may be required to assure that accurate and complete information is provided to the consumer, guaranteeing his freedom of choice. Additional rules may be justified in order to keep quality of the professional service over a certain level. However, all rules should be carefully scrutinised in order to prevent the abuses by professional associations. The experience of the CC in the last few years is a clear example of this approach.

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