Defending competition in the markets during COVID-19

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Under normal circumstances competition is needed in markets to keep prices low, but with the COVID-19 crisis wreaking havoc on markets the world over, collaboration has taken precedence.

The pandemic’s sweeping economic impact has left governments balancing between defending competition, so prices do not become prohibitive, and granting exemptions to competition rules to ensure the survival of entire economic sectors.

Defending competition in the markets during COVID-19 - Brand Spur
Manufacturers ramp up production of face masks

“Many authorities are adjusting the enforcement of competition laws to serve the greater public interest during this crisis,” said Teresa Moreira, head of UNCTAD’s competition and consumer policies branch.

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For example, the United States’ Department of Justice and the Federal Trade Commission have allowed collaborations among competitors in the health sector based on previous measures taken in the aftermath of hurricanes Harvey and Irma.

The United States has enacted strict guidance on collaboration in a time of emergency.

Likewise, Canadian and German authorities have allowed pro-competitive agreements between companies competing in the same market if they have good justifications.

While Germany has given the green light for collaboration in the retail industry and for supermarkets, Canada has allowed collaboration to support the delivery of affordable goods and services.

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Similarly, the competition and market authority in the United Kingdom has temporarily allowed retailers to collaborate to ensure the continuity of food supplies.

Sector-specific actions

Some governments have enacted sector-specific legislation granting different levels of exemptions from anti-collusion rules to businesses to mitigate the pandemic’s ripple effect on economies.

For instance, South Africa has approved a specific list-based block exemption from antitrust rules in the health-care sector to allow cooperation.

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Norway has granted a three-month exemption from the national antitrust laws to the airline transport industry.

Monitoring and responding to markets

As the pandemic evolves from a health crisis to an economic one, competition authorities are closely monitoring market developments and reacting accordingly.

They are facing down excessive pricing of sorely needed products in various countries.

Consumers have pinned hopes on announcements by the UKFranceBrazilRussia and Italy that are monitoring claims of excessive pricing and may establish price controls over high-demand items such as masks and hand sanitizers.

Read Also:  5G mobile networks DO NOT spread COVID-19, says WHO

As a preventive measure, the French government issued a decree to regulate the price of hand sanitizers to prevent retailers and pharmacists from engaging in abusive price increases.

Competition authorities in Kenya and China have heavily sanctioned retailers engaged in excessive pricing of health-related products.

“Authorities have to use all their tools to combat the adverse consequences of the COVID-19 pandemic in the markets,” Ms. Moreira said.

Research and development

Governments are also encouraging collaborative research and development efforts. These are compatible with competition legislation, as was the case in previous health emergencies such as the swine flu outbreak in 2009 and the Middle East Respiratory Syndrome in 2015.

For instance, the European Commission granted an exemption to European competition rules to research and development efforts towards a vaccine against COVID-19.

Joint research projects have received similar exemptions. They include efforts by pharmaceutical firms in Europe and the United States towards developing a vaccine against COVID-19 and a joint United Kingdom-Chinese project.

Recommended actions

UNCTAD recommends that governments take five key actions to protect competition in the markets during the COVID-19 crisis:

  1. Ensure equal conditions between companies for a level playing field that remains relevant even in a crisis period.
  2. Temporarily allow cooperation arrangements necessary to ensure the supply and distribution of affordable products to all consumers to prevent a shortage of essential products.
  3. Closely monitor markets of essential products such as disinfectants, masks and gels to ensure their availability, if necessary, through temporary prices caps to protect the health of consumers during the pandemic.
  4. Vigorously enforce competition law against companies that take advantage of the crisis by creating cartels or abusing their market power.
  5. Adapt competition procedures and deadlines to the extraordinary circumstances created by the pandemic.
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Defending competition in the markets during COVID-19 - Brand SpurDefending competition in the markets during COVID-19 - Brand Spur

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Defending competition in the markets during COVID-19 - Brand SpurDefending competition in the markets during COVID-19 - Brand Spur

Latest News

Strongest first quarter ever: Preliminary results of Deutsche Post DHL Group above market expectations

  • All divisions significantly increased EBIT in first quarter 2021; Group EBIT tripled to around EUR 1.9 billion
  • Free cash flow development continued positive trajectory and improved by more than EUR 1.4 billion to around EUR 1.0 billion
  • CEO Frank Appel: "The start into the new financial year was more dynamic than ever"
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SINGAPORE - Media OutReach - 12 April 2021 - Deutsche Post DHL Group has today released preliminary results for the first quarter of 2021 and has raised the outlook for the current financial year. Preliminary operating profit (EBIT) for the first three months improved to around EUR 1.9 billion (Q1 2020: EUR 592 million). The positive development of the group's businesses seen in the fourth quarter 2020 has continued well through the first quarter 2021. In the first three months of the year the B2C shipment volumes remained high in all networks while the recovery in the B2B business continued.

"The start to the new financial year was more dynamic than ever. It proves that we have successfully geared our business to the right growth drivers. One year into the pandemic we experienced in the first quarter 2021 a sustained momentum in e-commerce and a significant stabilization in global trade with increasing air- and sea-freight volumes. Consequently all divisions reported a significant jump in earnings above market expectations. Global trade continues to recover and vaccine distribution is in full swing which makes me very optimistic for the rest of 2021 and beyond," said Frank Appel, CEO of Deutsche Post DHL Group.

All divisions optimally positioned for continuing e-commerce boom and growth in global trade

Express: The division reached an EBIT of around EUR 955 million in the first quarter 2021 compared to EUR 393 million in Q1 2020.

Global Forwarding, Freight: EBIT in Global Forwarding, Freight stood at around EUR 215 million in Q1 2021, clearly above previous year's Q1 of EUR 73 million.

Supply Chain: EBIT at Supply Chain came in at around EUR 165 million in the first quarter 2021 compared to EUR 105 million in Q1 2020.

eCommerce Solutions: eCommerce Solutions recorded a first quarter 2021 EBIT of around EUR 115 million, clearly above last year's Q1 result of EUR 6 million.

Post & Parcel Germany: EBIT in Post & Parcel Germany in Q1 2021 was around EUR 555 million (Q1 2020: EUR 334 million).

Earnings momentum mirrored in positive cash flow development and improved outlook


The continued positive business development is underpinned by a strong cash flow development; free cash flow amounted to around EUR 1.0 billion in the first quarter 2021. In Q1 2020 this figure was still negative at EUR -409 million.

In light of the strong earnings momentum, guidance for 2021 is adjusted as follows:

Group EBIT for 2021 is now expected to be significantly above EUR 5.6 billion (previous forecast: more than EUR 5.6 billion). Equally, the result for the DHL divisions is now seen significantly above EUR 4.5 billion (previous forecast: more than EUR 4.5 billion). EBIT for the Post & Parcel Germany division is no longer expected at around EUR 1.6 billion but above EUR 1.6 billion. The expectation of a Group Functions EBIT of around EUR -0.4 billion remains unchanged. Full year 2021 Free Cash Flow is now expected to be significantly above EUR 2.3 billion (previous forecast: around EUR 2.3 billion).

The Group will introduce a revised detailed guidance with the comprehensive disclosure for Q1 2021 which will be published as planned on May 5, 2021.

Deutsche Post DHL Group

Deutsche Post DHL Group is the world's leading logistic company. The Group connects people and markets and is an enabler of global trade. It aspires to be the first choice for customers, employees and investors worldwide. To this end, Deutsche Post DHL Group is focusing on growth in its profitable core logistics businesses and accelerating the digital transformation in all business divisions. The Group contributes to the world through sustainable business practices, corporate citizenship and environmental activities. By the year 2050, Deutsche Post DHL Group aims to achieve zero emissions logistics.


Deutsche Post DHL Group is home to two strong brands: DHL offers a comprehensive range of parcel and international express service, freight transport, and supply chain management services, as well as e-commerce logistics solutions. Deutsche Post is Europe's leading postal and parcel service provider. Deutsche Post DHL Group employs approximately 570,000 people in over 220 countries and territories worldwide. The Group generated revenues of more than 66 billion Euros in 2020.


The logistics company for the world.

Defending competition in the markets during COVID-19 - Brand Spur
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