”I am in love with competition” - Margrethe Vestager during the hearings in the European Parliament for EU Competition Commissioner

INTERVIEW-NEW EU ANTITRUST HEAD NOT SWAYED BY ANTI-AMERICANISM, BULLIES 

23-Sep-2014 20:16

By Foo Yun Chee and Alastair Macdonald

BRUSSELS, Sept 23 (Reuters) - Margrethe Vestager says that neither "loud people" in business and government nor "anti-Americanism" will sway her rulings on antitrust cases when she becomes the European Union's new competition commissioner.

The Danish liberal, a free-trading economy minister at home until nominated to the incoming European Commission post, said she was determined to be a fair judge of corporate mergers and state aid for industries and would not be bullied by special pleading when she fears that Europe's ability to create jobs and wealth might be weakened.

Speaking to Reuters before her confirmation hearing in the European Parliament on Oct. 2, Vestager would not comment on specific cases.

But asked about calls in Europe for incumbent commissioner Joaquin Almunia to take a tougher line with Google and other U.S. tech firms to curb their large shares of some markets, she cautioned against prejudice:

"I don't think that any kind of anti-Americanism is well placed here," she said. "What I think is important is of course to be neutral and even-handed and actually look at the cases and not at the origins of the companies."

Some politicians, notably in Germany and France, and also some European companies have called for greater EU regulatory oversight of Google and other U.S. giants in various industries.

But Vestager, 46, who if confirmed will take over on Nov. 1 from her Spanish predecessor, said size alone was not enough for a regulator to go after a firm.

"I think it's very important also to be loyal to the text of the (EU) treaty, which says that basically it's not size that's the problem," she said. "It is if you misuse a dominant position that you do have a problem with the treaty and the fundamental values of the European Union."

NO "CUSHIONING" FOR EU FIRMS

In recent weeks, international business lobbies have raised an alarm over a spate of antitrust investigations in China, which critics say is aimed at protecting its firms from foreign competition. Some in Europe, however, have also called for EU states to do more to protect their own big firms.

Not on Vestager's watch.

"There are a number of ways to enable companies to compete globally," she said. "But cushioning from competition is probably a wrong way to go, because there is very harsh competition in the global market. So you need to be able to handle that in order to be there.

"And being cushioned in a European context is hardly the way to get the kind of muscle that you need for global markets."

Vestager said her upbringing and experience in the rough world of Danish multi-party politics would stand her in good stead for the kind of pressure that governments and global multinational firms will seek to put on her.

"I was brought up with a very strong value that you should always protect the few and the small against those who want to misuse their muscle and their weight in order to get what they weren't supposed to get," she said, looking ahead to a five-year mandate in what is one of the most powerful jobs in Brussels.

"Life in politics has taught me that there are some people who are very loud and put lots of pressure on but on the other side there are people who are silent and who are looking at you and hoping for you to be neutral and fair and even-handed.

"It is very important to have a very, very, very open ear to those who are not loud, who do not put pressure on."

Vestager also said she favoured reaching settlement of cases before they come to her for a final executive judgment, usually for reduced fines or negotiated concessions from the companies. Critics have complained that settlements have slowed the process of clarifying competition law.

Settlement, however, "does speed up things ... and enable cases to be closed rather than to be dragged over years and years," she said, stressing the overall goal was to ensure "fair and strong competition in a European and hopefully also global context".

The most important riddle of the summer: who will be the next Competition Commissioner?

Even as the summer reaches its highest season - and this can be seen all around us - the discussions on who will be appointed on which EU Commission job are also at reaching a peak. 

Unfortunately, the discussions surrounding the appointment are far from being transparent and even attention from the media is now low, due to the heat, the holidays and to the fact that most of the attention usually goes to the top job - that of President of the Commission – which is already settled. This is why I said that this is a riddle and not just a question. Behind the curtains, we are left guessing who might be in this and that position. 

However, there are several jobs where we hope that EU top politicians will nominate the best persons they can - the least politician of the politicians or the most technocrat of the technocrats, to be realistic! 

The Competition and State Aid position is one of the important jobs to be filled in over the summer. The next Commissioner is likely to have an even more difficult job than his predecessor - Mr.Almunia - who managed pretty well this area of the EU law and policy. There are several large challenges ahead for the to-be Competition Commissioner: the Google case (cases?), the Gazprom case, the enactment of the directive on private damages, as well as long disputed issues, such as those surrounding the way the decisions in antitrust matters are taken by the Commission, to mention only few of them. 

The selection looks more difficult than in the past - 2000 or 2008 - but not because of these challenges but due to other criteria, coming from the politics of the European Union. There are many persons who believe that the job will go to a Brit, in order to heal the wounds of the prime minister David Cameron, who lost his ill-fated battle for opposing Jean-Claude Juncker, and, hence, of UK as such, by assigning such an important job to a country on the verge to separate itself from the European Union.

I would be in favour of such a choice but not for the reasons listed above but because there is a higher chance that a person with a true belief in the market forces and in the free economy will take the position.  The European Union needs to re-discover its trust in the markets, which has been lost in past in the aftermath of the financial crisis, because of politicians who recklessly or purportedly put the crisis on the failure of the market forces rather than on their own mistakes and missteps. 

In a world where even the Chinese economy looks often more liberal than certain markets in the European Union and where there are ”tigers” of the economy in almost every region of the planet, the European Union must unleash the forces and the dynamism which accompany the market economy, rather than trying to put dams and plan the economic growth from offices in Brussels, London, Paris, Berlin or elsewhere. 

However, the (political) chances for a competition commissioner coming from London are rather slim (UK is more likely to receive a position of Vice-President of the Commission but in conjunction with another portfolio). 

The competition for the competition commissioner is more likely to take place between a person nominated by France (perhaps Pierre Moscovici) and the choice of Germany (the current Energy Commissioner Guenter Oettinger), with Germany keeping the highest odds. Mr.Oettinger is the only person who assumed directly and honestly his preference for becoming the next Competition Commissioner and he might be a decent choice for the job. 

Or we will witness a surprise - someone from the Eastern block?

Stay tune and watch! 

Recommended lecture of the month - July 2013 - "L'Europe par les juges" (Europe by the judges) of Robert Lecourt, former President of the European Court of Justice

L'Europe par les juges - Nonfiction.fr le portail des livres et des idées
This is an instrumental book regarding the key role that the European Court of Justice had in the creation of what is today the European Union.  Without the judges from Luxembourg and without their decisions, the European Union would certainly be less of an union today and lot of the benefits that the EU citizens now enjoy would not be available. 

Eric Stein, in an article signed in 1981 ("Lawyers, Judges, and the Making of a Transnational Constitution”, American Journal of International Law, 1981, no. 75, p. 1-27) noticed something that a few did at that time - namely that "Tucked away in the fairyland Duchy of Luxemburg and blessed, until recently, with the benign neglect by the powers that be and the mass media, the Court of Justice of the European Communities has fashioned a constitutional framework for a federal-type structure in Europe."

ECJ not only fashioned a constitutional framework for Europe but helped to build essential components, such as the internal market, through the competition rules. To give just one example of the role the judges from Luxembourg played in the competition enforcement, it must be recognized that the private enforcement, now high on the agenda of the European Commission and the European Parliament, would not be there without the landmark decisions which created the right to damages, almost ex novo, the same way the Roman praetors were doing.

Anyone who can get this book and is familiar with the French language (the book is not written in legal vocabulary), should read it.

Recommended lecture of the month - June 2013 - Grainne de Burca: "Europe's Raison d'Etre"

A very interesting argument of what EU was, it is and of what it should become.

Quote:

"What is the raison d’être of the European Union? Does it still make sense to ask this question today? Launched in 1952 as a kind of pilot project of limited economic integration with a view to securing greater peace and prosperity for its Member States, the EU has evolved into something much larger, more complex and more ambitious. This chapter argues, contrary to the recent suggestion of an influential commentator, that the question of the EU’s mission or raison d’être still matters today, and not only because of the serious economic crisis in which it has been mired since 2007. I argue that while the European Union at its origin was primarily inwardly focused on repairing and strengthening a damaged continent so as to deliver internal peace and prosperity, it has become as much or more concerned today with its external dimension, namely with enhancing Europe’s global economic and political influence and role. That is not to say either that the external dimension of European integration was unimportant at the time the Community was first created, nor that internal peace and prosperity has ceased to be a central concern in the present day. Far from it. Nevertheless, the last two decades in particular have brought a more sustained focus on the external and global significance of European integration, and when the question of Europe’s raison d’être is raised today, the importance of having a relatively unified European political system to counterbalance the influence of other existing and rising powers has become a more significant part of the answer than was ever previously the case."

For the full text, please go at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2224310&download=yes.