CPI Europe Column edited by Anna Tzanaki (Competition Policy International) & Juan Delgado (Global Economics Group) presents:
Interview With Joaquin Almunia by Juan Delgado (Global Economics Group)
Joaquin Almunia has occupied particularly important positions in Europe. As Economics and Finance Commissioner he lived through the start of the financial crisis and, as Competition Commissioner, zealously oversaw the bank rescue process. His time at the Directorate General for Competition has produced important landmarks such as the Google case, the tax benefits to large enterprises and the Antitrust Damages Directive. Today, we ask him to look ahead and analyze the future changes to competition policy and to Europe itself… As we have come to expect, his response was far from disappointing.
JUAN DELGADO – Mr. Almunia, we are now witnessing the start of a Competition Policy for the Internet. Do you think the future of competition policy and anticompetitive practices lies within the Web, or do we still have plenty left in the “physical world”?
Joaquín Almunia: The online world has created new tensions between platforms, content providers and infrastructure owners. The power of platforms grows as their capacity to obtain and process data increases, and along with it the creation of dominant positions and the possibility for abuse also grows. On the other hand, the internet generates large efficiencies, and so the application of Competition Law faces an important challenge in balancing out these forces. Competition Authorities should not take a pessimistic or defensive position towards the web, but a pro-active one. It’s true that there will be a rise in cases involving the Digital world, but I don’t think they will completely displace cases related more closely to the “physical world”.
JD: Does the fact that digital markets are global by nature pose a problem for the application of Competition Policy which is constrained by borders?
JA: What it does, is demand more regular and deeper coordination between competition authorities. The International Competition Network (ICN) was an excellent initiative, particularly well adapted to global markets. The ICN, being a place to meet and exchange experiences, allows for viable and effective coordination formulas to be developed in order to take on global issues. That being said, there are still many markets that remain national, within Europe and even on the internet. The problems often lie more on the fragmentation rather than on the globalization of markets… and in Europe we know how hard it can be to create a common market.
JD: Within this process of digitalization, we find new technologies that clash with the world of traditional regulation. Such is the case with the likes of Uber and AirBnB. Is there room for these ‘Ubers’ in Europe?
JA: Of course there is. In that sense, Competition authorities have a very important role to play in removing entry barriers to highly-regulated sectors, while also maintaining only the most necessary regulation to guarantee consumer rights. Even being banned in several countries, Uber has already revolutionized the transport industry: one can see a modernization taking place among the taxis of Madrid and Brussels, as they adopt mobile apps and offer new facilities.
JD: How much truth is there behind the apparent ‘face-off’ between European regulators and large American corporations?
JA: I don’t think there is any real basis to uphold these fears. Competition Policy is not being used in a protectionist sense, neither in Europe nor the USA. From a normative point of view, rules and procedures are still different in Europe and the USA, but the way in which we analyze infringements and the way we think about protecting consumer rights has seen an extraordinary convergence in the last 15 years.
Interview published in: Competition Policy International