All eyes were on Washington, DC last week as the European antitrust bubble descended on the US capital for the 71st edition of the American Bar Association’s (ABA) Spring Meeting.
Amidst the cherry blossoms and unseasonably warm weather, the annual ‘antitrust week’ convene offered a glimpse at the state of competition policy in 2023. Key trends observed: the behavior of Big Tech remains a top enforcement priority, the nexus of ESG and antitrust seems paradoxically urgent yet stubbornly abstract, and agencies are adamant in their view that the risk of under-enforcement is greater than over-enforcement.
Top staff turnover was another topic of discussion at coffee breaks and cocktails. The fate and legacy of Executive Vice President (EVP) Margrethe Vestager, who will shortly enter the last year of her term, was a constant topic of conversation. While the head of the UK Competition and Markets Authority (CMA) Sarah Cardell made her debut this year, explaining but not apologizing for her agency’s more tranchant stance on global antitrust topics.
Quite predictably, it was antitrust enforcement in digital markets that kept at the top of the agenda. The pending Digital Markets Act (DMA) and recent case-law like the EU General Court's (GC) Google Shopping judgment, as well as UK developments like the imminent legislation that will give statutory powers to the CMA's Digital Markets Unit (DMU) – were all debated.
The EC’s recently revised approach to Article 102 garnered a rare (if caveated) mea culpa at the start of the week from the EC. “We might have overdone it a little bit,” DG Comp Director General Olivier Guersent said referring to the economics-based approach in the 2008 exploitative conduct guidance, of which a revision was published last week.
On the sidelines, the commentary was harsher – as the revision offered an opportunity to reflect on the broader effectiveness of Article 102 enforcement. How did it take the EC so long to come to the realisation that the 2008 guidance had been an obstacle to enforcement, a lawyer commented on the sidelines, criticizing the agency’s approach to Article 102. In a room full of antitrust lawyers and economists, however, that was not the consensus view. An economist offered a perspective from the (far less popular) ‘other side’: the EC and its bretheren have become so scared of Type 2 errors (i.e. under-enforcement), that they’ve forgotten that Type 1 errors can have a negative impact as well, he said.
The intersection of antitrust and sustainability was another major topic, and one where a transatlantic divide appears obvious.
US Federal Trade Commission (FTC) Chair Lina Khan’s comment that sustainability is not a focus for her agency, if anything, a pretext to be interrogated when it is invoked by parties, caught the ear of some in the room. Khan's Republican States Attorneys General (AGs) colleagues have gone so far as to label industry ESG initiatives, such as BlackRock's Net-Zero climate initiative, as potentially anti-competitive.
In Europe, the debate is more focused on how far ESG exemptions can go. In a panel on Thursday (30 March), EC cartels official Maria Jaspers offered a preview of the pending sustainability guidelines, which will offer an enlarged safe harbor for sustainability agreements – although perhaps not as far as member states like Austria and the Netherlands intend to go in green-lighting exemptions. Cardell too discussed the CMA’s new sustainability guidelines, while noting that her agency is yet to be approached by parties with tangible cases. For all the discussion of sustainability in Europe, it remains largely theoretical.
Then there was the topic of EVP Vestager. More so than years prior, Vestager’s three days in DC reflected the immensity of her portfolio. She had meetings with Commerce Secretary Gina Raimondo and Treasury Secretary Janet Yellen, attended the Summit for Democracy, met with her colleagues at the FTC and DOJ. Outside of the ABA, the Inflation Reduction Act (IRA) and the progress of the Trade and Technology Council (TTC) were the main topics on the agenda (“This is not for Gina and me to have a cup of coffee,” quipped Vestager in defense of the progress made by the US-EU forum).
The EVP will likely make an appearance at next year’s ABA (as she did in 2019 a week after being announced as ‘Spitzenkandidat’). And after that? On the sidelines, there was much speculation as to Vestager’s next gig. The position of managing director of the DC-based International Monetary Fund (IMF) could be one potential job opportunity, noted a think tank representative. The head of the European Investment Bank (EIB) was also floated in conversations. Whether she would want that either job is another matter. That is of course if she intends to leave Brussels. As was noted by one attuned observer, Vestager would not be the first Commissioner to serve a third term if she were to stay in town.
Post-pandemic, the annual European pilgrimage to Washington, DC continues to hold its position as a must-attend on the annual antitrust calendar. With many meaty topics to discuss, this year was no exception.