THE HAGUE, Netherlands, March 5, 2026 — Competition in the Netherlands has weakened in recent years, raising concerns about innovation and productivity and highlighting the importance of strong competition for the emergence of successful European companies, according to a blog published by the Netherlands Authority for Consumers and Markets (ACM).
In the blog, ACM Chief Economist Paul de Bijl discusses findings from the authority’s newly introduced annual “State of the Market” report, which examines trends in competition between 2011 and 2023 using indicators such as market concentration, business dynamism and market outcomes.
The analysis found that market concentration increased over the period, particularly in sectors that were already highly concentrated. This trend was reflected in higher values for commonly used concentration indicators, including the Herfindahl-Hirschman Index and the market share of the four largest firms.
At the same time, measures of business dynamism declined, with lower rates of company entry and exit and stronger persistence of leading firms in concentrated sectors. According to the report, this suggests that new businesses are less able to challenge established players and gain market share.
Indicators related to market outcomes also point to weaker competition. Average markups increased slightly, indicating greater market power, while the Boone indicator—which measures how profits shift toward more efficient firms as competition intensifies—also suggested a reduction in competitive pressure.
Taken together, the indicators suggest that competition in the Netherlands has declined over the past decade, although the report notes that such measures should be interpreted cautiously because they rely on sector-level data and do not capture all aspects of market dynamics.
De Bijl also addressed the ongoing policy debate about the creation of “European champions,” arguing that scaling up businesses does not necessarily require a more permissive merger policy. He said mergers that increase market power could harm innovation and productivity growth, although competition authorities should remain open to transactions that support innovation and benefit consumers.
Instead of relying on greater market concentration, the blog suggests that expanding markets—particularly through deeper European integration and cross-border competition—would be a more effective way to strengthen competitiveness.
According to De Bijl, larger and more integrated markets can enable companies to scale while maintaining competitive pressure, increasing the likelihood that successful European firms can emerge and compete globally.
Source: https://www.acm.nl/en/publications/blog-paul-de-bijl-no-competition-no-champions
