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Speech of Executive Vice-President Vestager at the ICN Annual Conference, Berlin, 5 May 2022: "A new age of international cooperation in competition policy".

"Check against delivery"

Introduction

Good morning.  I was really looking forward to seeing many of you in Berlin today. I had planned to be with you in person but we are kicking off the legislative process here in Strasbourg on an important new regulation concerning foreign subsidies. That will for sure be the topic of many future ICN discussions.    

Even if only virtually, it's a great honour to be able to address the ICN today, more than 20 years since its creation. As an organisation, we have certainly grown - from just 14 members in 2001, to 140 today.

But our strength is in more than just our numbers. This network is a success because it provides a model for the kind of international cooperation we need in the 21^st Century.

Today, the world's economy is multi-polar, facing challenges and crises as never before. The horrific events in Ukraine show how high the stakes can be. They are the most forceful reminder that successful cooperation depends on respecting our diversity; on working to build consensus and encouraging best practice.

New Challenges in International Competition Policy

Of course, nothing ever stands still.  And as our economies need to adapt both to long term transformations and unprecedented shocks, so do we as competition enforcers.

The green transition remains the foremost challenge of our time. And there are many ongoing discussions on the right balance between regulation and competition to promote it.  But my focus today will be on the digital transition and how we should tackle it together, given the pace of change we are experiencing.

Cooperation in digital enforcement

When markets move fast, cooperation across borders becomes more necessary than ever. The good news is, we see this happening already. A good example for antitrust is our work with the CMA where we cooperated to jointly open investigations on Facebook's use of advertising data and of the Google-Facebook Open Bidding agreement, Jedi Blue.

But our experience in these cases, and in the many cases we handle within the EU, has also made us sensitive to the limitations of traditional enforcement instruments.  As competition enforcers, we have seen the number of digital cases explode around the globe.   It's even hard to keep track.   This illustrates the global and systemic nature of the practices and the market features we've seen in digital platforms.   This also illustrates why new tools are necessary to keep up.

Digital regulation

Some are calling it the ‘Great Pivot to Digital Regulation'. Actually, I don't like this term very much. It creates a false sense that the regulatory approach for digital is completely novel, something we have never seen before in the world of competition policy.

That's not the case.  Ex-ante regulation has always been complementary to antitrust enforcement and merger control. Just think about telecommunications, energy or financial services.  And we got guidance from the Courts recently confirming this complementarity, in the b-post judgment. In this judgment, the Court held that regulation and competition enforcement can work together because they pursue complementary and connected, but nevertheless distinct, legitimate objectives.

This is what we expect for the future of digital markets too - a hybrid approach, in which both ex ante regulation and traditional competition tools will both play their part.

At the same time, it is true that digital markets have some unique features. The role played by data is in some ways unique because it allows for zero-pricing models, and it allows conglomerates to jet-propel their reach, using consumer data as their fuel. Digital markets also display extreme network effects. We have many markets in which a handful of companies control access to end users and take advantage of that access.

Cooperation in the Age of Digital Regulation

Of course, this is a developing story. With the Digital Markets Act, the Commission might be slightly ahead for now, but we are all heading in the same direction. Already, other major jurisdictions are adopting digital regulation.  South Korea recently adopted legislation on app stores. Other jurisdictions are considering new digital regulations.  And here in Europe, Germany adopted its own digital regulation last year.

The speed at which the debate has shifted from whether there are antitrust cases at all to full blown regulation is quite extraordinary.   And the global agreement on the issues raised by large digital platforms is also extraordinary. This debate is no longer a hot topic amongst competition practitioners but it has strong political attention.  And things are moving fast.

We reached the political agreement on the DMA just a few weeks ago. The architecture of the DMA is designed around central enforcement at EU level, with  designated gatekeepers subject to certain do's and don'ts. This makes sense, because we are dealing with only a limited number of companies, which are by definition active on a European scale.  The DMA will enter into force next spring and we are getting ready for enforcement as soon as the first notifications come in.  

This next chapter is exciting.  It means a lot of concrete preparations. It's about setting up new structures within the Commission, pooling resources from DG Comp and Cnect based on relevant experience.  It's about hiring staff. It's about preparing the IT systems.  It's about drafting further legal texts on procedures or notification forms.  Our teams are currently busy with all these preparations and we're aiming to come forward with the new structures very soon.  

For that next chapter, close cooperation with competition authorities, both inside and outside the EU will be crucial. This is irrespective of whether they apply traditional enforcement tools or have developed their own specific regulatory instruments, like the German digital regulation.   Close cooperation will be necessary because we will not be short of work and we will not be short of novel services or practices to look at.   And the efforts needed at a global scale are enormous.  So we will need to work together more than ever.  And we already do.  Part of the preparatory work for the DMA will involve discussing with national competition authorities our future cooperation within the DMA, as well as coordination between the DMA and existing national regulations.  

Many of you will be watching the roll out of the DMA with great interest. This will be a mutual learning experience. The EU has worked hard to find the right balance, and I think we have come up with something that is tough, but also very fair.

It goes without saying that the more we, as an international competition community, are able to harmonise our approach, the less opportunity there will be for global tech giants to exploit enforcement gaps between our jurisdictions. 

It's worth remembering that the reverse is also true: the more we work together to develop common approaches to these challenges, the easier it will be for the tech industry to ensure compliance.  Compliance is - after all - what we ultimately strive to obtain. In this sense, good international cooperation can only be a win for enforcers, for businesses and ultimately for consumers.

That doesn't mean we all must adopt the same set of laws. We all have different legal systems and traditions, and different priorities. As the European Union has shown time and again, sometimes differences can be strengths - as long as we are united in our diversity.

What is important, I think, is that we have a common understanding of the principles we are working to defend, and a willingness to talk, and to listen. If we do, we will learn from each other. After all, that is what the ICN has always been: a space for us to engage in the right kind of dialogue.

That is why today's discussions are so important. The themes chosen for the sessions could not be more relevant, and the timing could not be better.

Conclusion

Before I conclude, it's worth remembering that when the ICN was created in October 2001, it was exactly 45 days since the horrific attacks of September 11^th. The brutality of those events cast a shadow over our work. It left a stain on our vision for a peaceful, cooperative world.

But it did not stop us. New York City built back, and we continued to work together, towards a better future.

Well, today it is exactly 73 days since Vladimir Putin ordered the invasion of Ukraine, shattering the peace in Europe and casting another shadow over our work.

But this will not stop us either. Ukraine will build back too. And the world will continue on the path of peaceful cooperation. Through the ICN and other forums, we will work even harder, as an international community, to achieve that brighter, more prosperous future.

Because ultimately, competition policy is about more than just ‘prices', ‘barriers to entry' or ‘market share'. It is about prosperity. It is about openness and it is about freedom.

Thank you.

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