Policy
Antitrust Nominee in Europe Promises Scrutiny of Big Tech Companies
Antitrust Nominee in Europe Promises Scrutiny of Big Tech Companies
BRUSSELS — The nominee
to become the next antitrust chief for the European Union has said that
keeping a close eye on American technology titans like Google and Apple
will be among her top priorities if she is confirmed.
Margrethe Vestager, a
former Danish economy minister, told lawmakers at the European
Parliament on Thursday evening that Google was “a business with a huge,
huge, huge market share,” and she signaled that she would look more
deeply into whether amassing data was a factor entrenching the strength
of digital companies like Google.
Personal data “is the
new currency of the Internet,” Ms. Vestager told the Parliament’s
influential Economic and Monetary Affairs Committee. “We should engage
in not only fact-finding but much deeper understanding of these
markets.”
Ms. Vestager declined
to say whether she would proceed with formal charges, known as a
statement of objections, against Google in a five-year-old case focused
on its search and advertising businesses. But she was “absolutely
certain that there will be next steps” in the Google case. As to “what
kind they will be, it is too early for me to say,” she said.
Ms. Vestager’s
comments on Google were sufficient to earn an endorsement on Friday
morning from Burkhard Balz, a German lawmaker and a spokesman for the
center-right political group on the Parliament committee. Mr. Balz said
his group “would like to see strong action in investigating further into
the Google case” and its members “appreciate her assurance to follow up
this matter with the utmost importance.”
Ms. Vestager’s hearing
is part of a lengthy process of selecting the leadership of the
European Commission, the European Union’s executive arm.
Although the
Parliament does not have the power to veto individual candidates, it can
approve or reject the entire slate of nominees. That vote has been
scheduled for Oct. 22, just a few days before new members of the
commission are scheduled to take office.
A rejection by the
Parliament or a delay to the vote because of wrangling among political
blocs would leave the current competition commissioner, Joaquín Almunia
of Spain, in place for an indeterminate period of time. The job is one
of the most powerful in Brussels because the holder can directly
intervene to block mergers and can order companies that form cartels or
break antitrust laws to pay fines of up to 10 percent of their global
annual sales.
Ms. Vestager received a mostly warm reception from lawmakers, suggesting her nomination was secure.
How much her approach
would differ from Mr. Almunia’s remains to be seen. But Ms. Vestager
would almost certainly be under pressure to show less patience with
Google than her predecessor, as many Europeans have become more
concerned with data privacy.
The digital sector was
among those where “particular alertness is needed to ensure that
dominant players respect the rules,” she said. “This is all the more
important to allow innovation from small and medium-sized companies to
flourish,” she said.
As competition
commissioner, Ms. Vestager would also be responsible for preventing
European Union member states from doling out market-distorting
subsidies, also known as state aid, to favored companies.
This week, the commission published a report
into one of the biggest state-aid cases it has undertaken: an
investigation into the way Ireland may have offered Apple overly
generous tax breaks dating to the early 1990s. That case, and similar
investigations into the tax affairs of Starbucks in the Netherlands and
of a unit of the Italian automaker Fiat in Luxembourg, “are certainly
going to be priorities,” Ms. Vestager said.
Tax avoidance by multinationals is “a very, very serious issue,” she added.
In the antitrust
allegations against Google, the search giant could theoretically face a
fine of nearly $6 billion. Fines have never gone that high, but
antitrust experts say that such penalties are set to rise. In June, the
second-highest court in the European Union upheld a 1.06 billion euro,
or $1.34 billion, fine against Intel, representing 4 percent of the
maximum penalty.
Last month, Mr.
Almunia was forced to postpone a deal with Google that he announced in
February after an outcry from powerful German and French publishers and
from rival technology companies like Microsoft and Yelp.
Those companies said
that the core of the deal between Google and Mr. Almunia — a system that
would more prominently display rivals’ search services for finding
hotels and for shopping, among others, when people conduct Google
searches — would do little to help them compete more effectively in
Europe, where, in many countries, Google powers more than 90 percent of
searches.
Correction: October 3, 2014
Because of an editing error, an earlier version of this article referred incorrectly to the company that theoretically could face a $6 billion fine in a European antitrust case. It is Google, not Apple.
Because of an editing error, an earlier version of this article referred incorrectly to the company that theoretically could face a $6 billion fine in a European antitrust case. It is Google, not Apple.
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