The quote in the question isn't really rigorous about what a free market is, but it talks about monopolies and artificial scarcities, so I am interpreting the efficient outcome with price equal to marginal cost as being one necessary feature of what they understand as a free market.
Let's look at the cournot model of competition. There are $n$ firms, each with idiosyncratic marginal cost $c_i$. Each firm simultaneously chooses its output (supply) quantity, $q_i$. Given consumers' demand, this results in some market price $P(Q)$, where $Q=\sum_{i=1}^n q_i$ is the total industry output. We would expect the demand curve to be downward sloping: $P'(Q)<0$.
Thus, a firm's profits are
$$\pi_i(q_i,\mathbf{q}_{-i})=\left(P(Q)-c_i\right)q_i.$$
The first-order condition for maximisation of profit is
$$\frac{\partial\pi_i}{\partial q_i}=P(Q)-c_i+\frac{\partial P(Q)}{\partial q_i}=0.$$
Noting that $$\frac{\partial P(Q)}{\partial q_i}=\frac{\partial P(Q)}{\partial Q},$$
the first-order condition can be re-written as
$$\frac{P(Q)-c_i}{c_i}=-\frac{\partial P(Q)}{\partial Q}\frac{Q}{P(Q)}\frac{q_i}{Q},$$
$$\frac{P(Q)-c_i}{c_i}=-\frac{1}{\eta}m_i,$$
where $\eta$ is the price elasticity of demand and $m_i=q_i/Q$ is firm $i$'s market share.
The left-hand side measures a firm's price-cost margin, or its market power. We can compute the average market power in the industry by weighting each firm by its market share:
$$\text{avg market power}=\sum_i m_i \frac{P(Q)-c_i}{c_i}=-\frac{\sum_i m_i^2}{\eta}.$$
Note that $\sum_i m_i^2$ is the HHI index for the market. So this equation tells us that the average market power in an industry will be positively related to the HHI. For any positive HHI, there will be a positive mark-up and the market will deviate from the perfectly competitive outcome in which artificial scarcities do not exist. Put differently, only if there is an infinite number of firms, each controling an infinitely small share of the industry do we obtain the textbook perfect competition outcome.
