19 EU countries call for new antitrust rules to create ‘European champions’

Commissioner of Competition Margrethe Vestager is wary about having cross-border mergers given that they could limit competition in the internal market. [European Commission]

A total of 19 EU governments have proposed updating the EU’s antitrust rules in order to facilitate the emergence of European industrial giants able to face “fierce competition” from the US and China.

After a ministerial meeting in Paris on Tuesday (18 December), the group of 19 countries called for “new political impetus” to ensure European industry remains competitive on a global level.

As part of a new assertive strategy, the 19 EU governments said they will make proposals to the next European Commission that will be nominated after the EU elections in May 2019.

One of their main ideas is “the identification of possible evolutions of the antitrust rules to better take into account international markets and competition in merger analysis,” the final statement reads.

France and Germany have defended cross-border mergers between big national firms over the past months in order to forge European “champions”. However, the Commission is traditionally wary of such operations, fearing they could squeeze competition in the single market.

Alstom, Siemens merge to create new European rail champion

The maker of France’s TGV trains announced Tuesday (26 September) a “merger of equals” with German industrial leader Siemens in a giant and politically tricky deal to create a new European rail champion.

The EU’s antitrust chief, Margrethe Vestager, expressed concerns on Tuesday over plans to merge Germany’s Siemens and France’s Alstom to create a European rail champion.

Asked about the merger during a press conference, she said: “It is right to say that we have concerns on very high-speed trains because it is very important for Europe to develop also when it comes to high-speed trains.”

But some national governments disagree. “If we want to be able to face competition with Chinese giants, we have to bring European forces together,” said French finance minister Bruno Le Maire, in comments to the Financial Times aimed at defending the merger.

Vestager is expected to meet with Le Maire in Brussels later today (19 December).

Commission to judge in May France’s deficit deviation

The European Commission will conclude in May whether France’s deficit slippage caused by new spending measures represents a limited and temporary deviation allowed by the rules.

The French minister will meet as well with Commission vice-president for the euro, Valdis Dombrovskis, and commissioner for Economic Affairs, Pierre Moscovici.

Le Maire will explain how France intends to meet the EU’ budget deficit targets despite new spending plans announced after the ‘yellow vests’ protests.

‘Act quickly’

The 19-group statement on industry was signed by France, Austria, Croatia, Czech Republic, Estonia, Finland, Germany, Greece, Hungary, Italy, Latvia, Luxembourg, Malta, Netherlands, Poland, Romania, Slovakia and Spain.

They say Europe “must act quickly to maintain its competitiveness” and face “fierce competition” from other large economies with proactive industrial strategies.

To do this, they urge the EU to adopt a “comprehensive” and “assertive” industrial strategy that takes into account the specific needs of industries and regions.

Commission ignores calls for objectives in new industrial strategy

The European Commission did not include new strategic objectives and targets in its industrial package unveiled on Monday (18 September), stressing instead that a master plan already exists for European industry.

The member states agreed that the new Commission should propose this ambitious industrial strategy “as soon as it is in place” next autumn. The plan should include indicators to monitor progress made.

Before that, the bloc should identify European strategic value chains “prioritising those most directly linked to improving global productivity, fighting climate change, and enhancing technological development”.

For each of these strategic value chains, there will be a dedicated action plan. These plans would be backed by EU funding and supported from various policy angles, including competition, innovation, digital, energy, trade or taxation.

France, Germany push EU funding for tech start-ups

France and Germany are pushing for an EU-wide initiative to fund innovation and research in tech start-up projects across the bloc so that Europe can compete more effectively against the likes of China and the United States.

As a starting point, France and Germany announced on Tuesday that they would increase their industrial cooperation in three key areas: battery cell production in Europe, disruptive innovation and artificial intelligence.

The Commission also gave its approval Tuesday to an alliance formed by France, Germany, Italy and the UK to finance worth €1.75 billion worth of research and innovation in the field of microelectronics.

European battery alliance launched in Brussels

The European Commission hosted auto, chemical and engineering executives in Brussels yesterday (11 October) to develop battery manufacturing in the EU to compete with Asian and US manufacturers.

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