European Union: Margrethe Vestager To Become The New Commissioner For Competition

On 10 September 2014, the President-elect of the European Commission Jean-Claude Junker appointed the Danish nominee Margrethe Vestager (46) as the new EU Commissioner for Competition. In November, subject to a confirmation from the European Parliament, she will become the successor to the current holder of the competition portfolio Joaquín Almunia.

Background

Called "Denmark's most powerful politician" and described as "a potential star of the new Commission", Vestager was nominated by the Danish Prime Minister Helle Thorning-Schmidt in August. A member of the Social Liberal Party ("SLP" - Det Radikale Venstre, literally: "The Radical Left"), Vestager just left her post as Denmark's Economics and Internal Affairs Minister and a deputy prime minister, held since 2011. She has been a member of the national parliament since November 2001 and was appointed parliamentary group leader of her party in 2007.

Vestager holds an economics degree from the University of Copenhagen. At the age of 21, she joined the central board and executive committee of the SLP and of the European Affairs Committee. Upon graduating, Vestager became National Chairwoman of the Party. Until 1998, she was head of the secretariat of the Agency for Financial Management and Administrative Affairs, prior to which she worked for two years as head of section at the Danish Ministry of Finance. Having gained substantial experience in financial and economic matters, Vestager became Minister of Education and Ecclesiastical Affairs in 1998.

As an Economic Affairs Minister, Vestager negotiated an agreement on the imposition of losses on banks' investors and bondholders in case of failure (burden sharing or bail-in), which formed the basis for the EU policy on government bank rescues. During the Danish presidency of the EU in 2012 she chaired the meetings of economic and finance ministers of the EU, leading to successful negotiations over an agreement on the overhauling of bank capital requirements and the adoption of a law to safeguard derivatives markets. Officials, cited by the Financial Times, say that "there was nothing she would not do to get the deal done".

The Commissioner's Priorities

The new Competition Commissioner's policy will be influenced by the decision of the President Jan-Claude Junker to implement a different organisation of the European Commission: he has entrusted priority projects in key areas to a number of Vice-Presidents with the task to steer and coordinate work across the Commission. Thus, the portfolios of several Commissioners will be grouped and led by the Vice-Presidents. The Commissioner for Competition will work closely together with the Vice-Presidents for Jobs, Growth, Investment and Competitiveness, for the Digital Single Market and for Energy Union.

In his Mission Letter to the new Commissioner, Junker indicated that during her mandate Vestager should focus on:

• mobilising competition policy tools and market expertise so as to contribute to the jobs and growth agenda, including in areas such as the digital single market, energy policy, financial services, industrial policy and the fight against tax evasion;

• pursuing an effective enforcement of competition rules in the areas of antitrust and cartels, mergers and State aid, maintaining competition instruments aligned with market developments, as well as promoting a competition culture in the EU and world-wide;

• maintaining and strengthening the Commission's reputation world-wide and promoting international cooperation in this area.

Notably Vestager was urged to "keep developing an economic as well as legal approach to the assessment of competition issues and to further develop market monitoring in support of the broader activities of the Commission".

Some of the current challenges that Vestager will have to face as part of her portfolio are the on-going Google and Gazprom investigations, the extension of the scope of application of the EU Merger Regulation to non-controlling minority shareholdings, as well as the implementation by the Member States of the EU Directive on antitrust damages actions adopted in April.

On 2 October, Vestager appeared before the EU Parliament to receive questions aimed at assessing her suitability to take over the competition portfolio. During the 3-hour long hearing she addressed a variety of issues, such as the Google and Gazprom investigations, bank bailouts, tax evasion, and gained the firm approval of the majority of the parties. According to some commentators, her excellent preparation won her the praise of "star commissioner".

In her opening statement Vestager referred to the energy and digital sectors where "particular alertness is needed to ensure that dominant players respect the rules", placed the State aid modernisation agenda as her priority and underlined the importance of industrial policy, since "[b]etter regulation creates and supports the Single Market and fosters competitive companies". Answering a question from an MEP, Vestager also stressed the need for antitrust fines "so big that they will ruin any undue profits you made out of your cartel".

Ditte Juul Jørgensen, currently a director for legal affairs and trade in goods in DG Trade, is designated as head of Vestager's private office. The deputy-head will be Linsey McCallum, who has been involved in EU probes into Google, Samsung and Motorola, as well as in telecoms and hard disk drive mergers.

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