Competition Law and Transitions to and Away From Democracy

ABSTRACT Competition law serves not only to regulate markets but also to construct and deepen them, particularly during transitions from centrally planned or heavily regulated to market economies. Its significance is both economic and political: Since its inception, competition law has sought to prevent concentrated economic power from distorting the functioning of democracy. This article explores how competition law shapes democratic transitions and democratic erosion. It puts forward that competition law supports democratisation by constraining powerful economic interests, reinforcing the separation of powers through enforcement and advocacy by independent agencies and strengthening state capacity. Conversely, authoritarian actors may instrumentalise competition law to entrench their power, reward allies and suppress opposition. Democratic erosion, in turn, undermines the autonomy of competition agencies and their enforcement efforts. The article draws on economic and democratic transitions in Central and Eastern Europe, Turkey and Latin America and charts recent cases of democratic decline in these contexts to illustrate its arguments.