Margrethe Vestager one year on: a proactive force and a stickler for procedure

Written on 7 Jan 2016

1 November 2015 marked the first anniversary of Margrethe Vestager taking up the post of European Commissioner for Competition, and here – just over one year on – we reflect back on the actions and steps she has taken in the early days of her post.

Ms. Vestager took over her current position from Joaquin Alumnia and inherited from him a large amount of unfinished business, meaning that much of her focus to date has centred around closing and re-directing work initiated under his command.

Digital Economy

In addition to transitioning the inherited workload, Ms. Vestager has clearly marked out her own priorities for EU competition law during her mandate; the most prominent being her focus on how the Commission should respond to the increasingly digital world and its online technology demands. This is perhaps demonstrated most clearly by the full scale e-commerce inquiry launched on 6 May 2015 (read more here).

Reduced focus on cartels

Unlike her predecessors, Ms. Vestager has placed less focus on cartels, collecting only €364 million in fines in her first year, while Alumnia imposed €3 billion in fines for companies engaged in cartel actions during his inaugural year in office. Ms. Vestager has even taken steps to drop some of the cartel investigations begun prior to her taking up of the post.

Mergers facing greater scrutiny

In contrast, Ms. Vestager has presided over a greatly increased scrutiny of merger control. In 2015 she launched full inquiries into ten mergers, double or more than double of her predecessors during their first 12 months. This intensified examination of merger activity resulted in Ms. Vestager completely blocking two deals, whilst securing significant concessions from numerous others.

Vertical agreements

The reduction in cartel fines may also reflect a shift in focus towards vertical restraints, with internet selling and vertical pricing agreements being a key focus across Europe. Ms. Vestager has said that she believes that online business and markets move quickly and the Commission’s vertical guidelines can only provide a general framework. As such, there has been noticeable scrutiny from the Commission in relation to vertical restraints in this digital sphere, including its investigation into the cross-border provision of pay TV services opened in January 2014, which is still ongoing.

State aid stalling?

And what of State Aid? Ms. Vestager has indicated that this area of antitrust law is part of her agenda. However, despite intentions to conclude probes into alleged aid given to Fiat, Starbucks, Amazon and Apple by mid-2015, only Starbucks and Fiat have so far been required to pay back funds classified as illegal State Aid.

What next?

Overall Ms. Vestager’s first year in the role has been characterised by an aggressive and proactive stance. She has not been afraid to challenge industry leaders such as Google, Amazon and Mastercard and has shown a noticeable reluctance to settle cases; holding true to her belief that doing so fails to develop strong case law and competition law principles. It also seems that Ms. Vestager is a stickler for procedure and is willing to extend the duration of investigations or open them up to challenge in the EU courts, if this is what is necessary under the rule book.

With such a robust foundation year under her belt, the future for competition law, certainly for the next four years of Ms. Vestager’s time in office, looks to be an active one.