Although the last few months have seen the emphasis shift at the European Commission towards an attempt to tackle economic issues and crisis manage the dramatic situation for farmers, competition commissioner Mario Monti has nevertheless steered a steady course. Indeed, he appears to be having a decisive influence in areas not strictly in his remit and is extending his influence within the College of Commissioners.
As internal market commissioner, Monti had already gained the reputation of being a consumer’s champion without fear of national governments. As competition commissioner he has continued to attach great importance to the benefits of a consumer-orientated economy, a sound single market and a Europe free from outdated state subsidies.
One area where the commissioner has shown his stalwart defence of the consumer is in his handling of mergers. He has maintained a tough stance in both the “old” and “new” economies and he took a strong line against the proposed WorldCom/Sprint and EMI/Time Warner deals last year. At the end of January this year, he continued his consumer crusade when the Merger Task Force (MTF) prohibited the acquisition of Metsä Tissue by SCA Mölynlycke.
The commissioner is often quoted as saying that the achievement of a sound single market depends upon the efficient enforcement of the rules in place. In the field of mergers, he promoted the adoption last year of a simplified review procedure and has provided valuable guidance to companies on remedies by the adoption of a notice on this subject in March.
The present system of implementation of the European Union (EU) rules on cartels is based on public enforcement by the commission, but Monti considers that in a mature competition law system, private enforcement should also play an important role. Progress continues with the commission’s modernisation proposals, notwithstanding fierce criticism from some quarters. Recent appointments to the cartel unit in directorate general competition have signalled the commissioner’s backing for increased levels of enforcement activity, and several new investigations have subsequently been launched.
In recent weeks, the commissioner and his director general Alexander Schaub have been placing considerable emphasis on improving competition law enforcement in the global economy by strengthening international cooperation. The Global Competition Forum, which was launched last September on the 10th anniversary of the MTF, has been very strongly supported by both Commissioner Monti and Schaub. In February, at a meeting organised by the International Bar Association, the commissioner joined a large group of senior enforcement officers in supporting the initiative to streamline global competition law enforcement.
From the perspective of European consumers, two areas in which the commissioner has recently shown that he is in touch with their interests are in postal services and football.
In a recent groundbreaking decision, the German post office has been fined euro24m (£14.8m) for abusing its dominant position by granting fidelity rebates and engaging in predatory pricing in the market for commercial parcel services. It is also required to create a separate legal entity for those services. This could have far-reaching consequences for monopolies in other public services across the EU.
And what of football? The commissioner took the spotlight away from the other two commissioners in charge of this matter and brokered a deal with Fifa and Uefa on 5 March which ensures better competition in the field of player transfers across the EU and sets out strict contractual conditions for this. The deal also covers broader social and educational questions but was actually announced from Commissioner Monti’s office. Thus, Professor Monti, who had introduced himself at his 1999 hearing as an economist and academic, has shown over recent months that he is also a very able politician.
Michael Reynolds is head of Allen & Overy‘s EU office in Brussels