EU Antitrust Head Plans Review of Tech Companies' Market Power
"We have to keep focusing on what happens when you have dominant companies in these fast-moving markets," Margrethe Vestager said.
October 08, 2019 at 02:47 PM
4 minute read
The EU's antitrust czar is planning to review definitions of market dominance, to deal with the power of fast-growing tech companies.
Margrethe Vestager, who has been nominated for a second term as the European commissioner for competition policy, told lawmakers, "we have to figure out what constitutes market power", when she appeared before the European Parliament for her confirmation hearing.
"When you de facto own a market… the rule you set is not fair competition but 'my own products first'," she said. "We have to keep focusing on what happens when you have dominant companies in these fast-moving markets."
Vestager gave the example of the business opportunities offered by artificial intelligence and the importance of controlling a lot of data, as major issues for competition authorities. "If you don't have the right data, it's very difficult to provide the services," she said.
Apologising for a biblical reference, Vestager, who is the daughter of two Lutheran pastors, said: "We shouldn't end up in a situation where those that have should be given more."
Vestager was asked about breaking up companies as a remedy to market dominance. She said that, while breaking up companies is a "tool" she could use, "my obligation is to do the least intrusive thing to restore competition to a market".
She said the Commission's remedies in antitrust cases were able to restore competition in markets affected by a dominant company. Citing the example of the Android case, in which she fined Google €4.34 billion and ordered it to give consumers the option of downloading rivals' applications, she said the company was forced "to open a marketplace that was otherwise, because of illegal behaviour, completely occupied by themselves".
Alec Burnside, a partner at Dechert's Brussels office, said: "Margrethe Vestager is plainly exercised by the ineffectiveness of the remedies imposed so far on Google. She's focused on using the available toolkit to 'reinstate competition'. We can expect that to be a focus of future work."
Vestager, who has been given responsibility for boosting the EU's digital performance as well as retaining the competition brief, rejected suggestions that there would be a conflict of interest between her two roles. She insisted that the independence of decision-making in EU competition policy was "non-negotiable". Vestager said she would continue to rely on the independent advice of the competition department's chief economist, as well as the commission's legal service, in making the right decisions to safeguard competition.
"The legal service… know that they will have to defend the cases in court. Which means of course that they are very particular that there is no interference from anything else than what they can defend," she said.
Vestager, who has launched a series of cases against EU countries' sweetheart tax deals for multinationals, said she will continue to work to ensure that tax deals do not distort competition in the bloc's internal market.
Asked about plans for a digital tax on the activities of companies that sell their products and services digitally, Vestager said she hopes that a global agreement on digital tax can be found, but if that is not possible, she said, "we will do it ourselves", referring to the EU.
Vestager's pursuit of U.S. tech companies, including Apple, over tax deals has earned her the ire of U.S. President Donald Trump, who said she "really hates the U.S.".
Her confident performance before members of the European Parliament makes it almost certain that she will be approved for a second term as a commissioner. The entire 28-member Commission needs the backing of the European Parliament before it can take up office as planned on November 1.
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