Business World

Friday 20 September 2019

Liam Proud: 'EC sticks with its competition queen'

Up to a challenge: Margarethe Vestager. Photo: Reuters
Up to a challenge: Margarethe Vestager. Photo: Reuters

Liam Proud

The new European Commission has got off to a good start before it has even started work.

Denmark's Margrethe Vestager will hold on to the competition tsar role in which she has already spent five years ruffling feathers on both sides of the Atlantic.

That wins the incoming president of the European Union executive, Ursula von der Leyen, kudos even before she takes office.

Vestager was one of three senior executive vice-presidents in Von der Leyen's team who were named this week, pending the European Parliament's approval.

The Dane's responsibilities will also include co-ordinating efforts to create a "Europe fit for the digital age", in the words of her new boss.

Vestager is up to the challenges of such a huge portfolio.

Her efforts to weaken technology monopolies have led to multi-billion dollar fines against the likes of Alphabet-owned Google.

She can now see through an investigation into Amazon's dual role as both marketplace and merchant, as well as a nascent study of Facebook's currency Libra.

Vestager will have the chance to rethink how anti-trust policy approaches data monopolies such as Facebook and Google, as recommended earlier this year by a report she commissioned.

All that is likely to irk United States President Donald Trump, who has in the past complained that Vestager "hates the United States perhaps worse than any person I've ever met".

He may not like Europe's new trade commissioner, Ireland's Phil Hogan, any better. Hogan this week called Trump "reckless" on trade and said he wants to make the president see the "error of his ways".

Vestager's reappointment will also grab the attention of chief executives, investment bankers and politicians who favour mergers as a way of creating European industrial champions.

She blocked the Siemens-Alstom rail merger earlier this year despite heavy Franco-German lobbying, and opposed several telecommunications deals which would probably have led to higher mobile prices.

That means she is unlikely to give in easily to pressure from Paris and Berlin to water down competition rules.

By choosing a political heavyweight with the credibility to withstand intense pressure, Von der Leyen is in some ways setting out her own stall. Vestager's credibility burnishes that of Von der Leyen and the new team she has picked.


Also in Business