Regulators in the United States have mostly stayed mum as large corporations amass market share and economic power. In contrast, the European Union has tried to tame the tech giants, going after the likes of Amazon, Apple, and Google. I spoke with EU Commissioner for Competition Margrethe Vestager, the world’s most feared antitrust enforcer, about her recent actions. —Mike Konczal
MK: Tell me about the EU’s philosophy on competition and antitrust. What are the goals you hope to achieve?
MV: First and foremost, European antitrust, back when it was defined in the 1950s, was very much inspired by the United States. We have antitrust in terms of merger control, abuse of dominant position, and cartels. We only added one thing: It’s our competition legislation to prevent what we consider harmful state aid. In order to have a level playing field, we take issue if a government sides with a company and makes it difficult for another company to compete. The reason we do this is to make sure that the market serves the consumer.
MK: You levied a historic $2.7 billion fine against Google last year. Can you walk us through what you did, and why you thought Google harmed competition and consumers?
MV: In Europe, Google absolutely dominates general search; it is 95 to 98 percent in many European countries. We find that Google misused this dominant position to promote its own shopping-comparison product. You would always be presented with a Google shopping product; on average, you would find competing services on page four. No one goes to page four. Jokingly, you would say that this is where you bury your secrets, because they’d be absolutely safe. We find that this is harmful to competition, because you limit choice by promoting yourself and demoting others.
MK: When it comes to large digital platforms, do you find you’re applying old principles to new markets or having to start from the ground up?
MV: On our fundamentals, we are fine. Competition law is about things that have been around since Adam and Eve; it’s about greed and fear and power. The very basics—that you cannot form a cartel, that you cannot decide on prices with your competitors, that you cannot cheat your customers, that you cannot misuse your dominant position—are still as relevant as when these principles were formed. Where we have to invest is in our tools. Markets are moving much faster these days than they were 10 or 20 years ago.
MK: There’s a stereotype that the United States is the land of small business and competition and Europe is old, sclerotic corporatism. Yet small-business formation has plummeted in the United States while concentration skyrockets, and Europe is leading the charge on antitrust. Why are you out ahead of US regulators?
MV: I’m not privy to the internal discussions of the [Federal Trade Commission] or other regulators. But in the last decade in the United States, a number of different markets have become much more concentrated. You find that we have more competition in Europe. The European markets are becoming more concentrated, but not at all to the same degree as in the United States. So there are differences—but why the United States decided not to have a Google case, I don’t know in any detail.
MK: People in the United States are looking at monopoly and competition with fresh eyes. Yet understanding the problem can be exhausting and create cynicism, as if it’s too difficult to ever challenge. What is some advice for citizens for tackling these problems?
MV: What I can say is that what we find to be important is that we are willing to take on difficult cases. We make it a priority to do it fast so that citizens can see that we actually do take action. I think it’s important for citizens in Europe to see not only passing legislation, but also active enforcement. Because for decades, legislators have been framing the marketplace with environmental laws, laws on working conditions, human-rights issues, consumer protection—but within that frame, people expect competition. Businesses should present their products and services on the merits. The important thing for us is that we put our efforts into enforcement, so that actions are taken when things are not right.