For industrial policy. It really is a bit odd. Since the beginning of the month, the Union's competition policy has had substantial changes made to it and yet we continue to read and to hear the same criticism as we did yesterday, as if there had been no change at all. We are, of course, allowed to take a negative view of the revised policy if we choose, but we have to admit that revision has taken place.
The most widely expressed reservation concerning Commission action in this field is well known. I could, if I were to make an offhand simplification of the issue, say that the main reproach made of the Commission is that, when assessing company concentrations, it did not sufficiently take the economic effects into account, giving priority to legal aspects. The debate had gone far beyond legal and economic circles more or less explicitly up to the level of Heads of Government (Chancellor Schröder's approach in Brussels; the joint letter from the same chancellor, President Chirac and Prime Minister Blair to the Commission president). There's nothing wrong with that. It is a sufficiently important matter to have political leaders deal with it. It is precisely in the examination and assessment of concentrations that reform brings in-depth innovation. Competition Commissioner Mario Monti had explained this on several occasions before the new regulation took effect.
A long road rather than conversion. The comprehensive document that the Commission approved last week stresses that the economic analysis has been strengthened and specifies that the "increased effectiveness" that concentration can give a company is specifically taken into consideration (see yesterday's column). Until last month, the essential element for assessing a merger was that of knowing whether it cut back the number of rivals on the market or created monopolistic or oligopolistic situations. Now, account is taken of gains in effectiveness, such as production cost savings and the distribution or advantages in the field of research and innovation "which could result in the creation of new products to the consumers' advantage". My description is no doubt over-succinct, as reality is far more complex. The main thing is, however, that the Commission should recognise that the new approach, which is "more modern and of a more economic kind", should make it possible to differentiate between "concentrations that are detrimental to competition and those which, on the other hand, strengthen it". It is coming more into line with the United States on this. On 28 February this year, in Los Angeles, Mario Monti had devoted a whole speech to convergence between European and American merger policy, defining this convergence as one of the most important "success stories" in Euro-American relations in recent years.
I nonetheless feel it would be wrong to speak of Mario Monti as if he had undergone a sort of "conversion". Everything points to his having long considered that the economic, if not social, aspects must play a growing role in competition policy. His declaration "I support a real European industrial policy" (of which competition policy was a fundamental element) dates back to October 2003, and the affirmation whereby "services of general economic interest (SGEI) are a pillar of social cohesion throughout the Union" and therefore must be guaranteed, goes back to February. Reform of "competition" regulations had already begun several years ago, as these things take time. All circles concerned had been consulted. Negotiation between the Member States had sometimes been difficult and the European Parliament had discussed the matter at length. The number of legal texts needed to implement the reform is impressive. You only have to look at the list of the most recent, approved on 30 March. None of this will prevent criticism and protest against a decision here and a decision there but one must never forget that, in each difficult or controversial case, there are conflicting interests at stake. If one is pleased, the other complains - and it is always those who are not pleased who make their voices heard.
Administrative reform also. Not only have the regulations been amended, but also the way the Commission's "competition" services work. In the past, a task force would look at all the proposals of merger. Now, there is a sectoral breakdown of dossiers: specialists in the "automotive" sector (to take a sector at random) are responsible for all the dossiers involving this sector, whether they are on the subject of agreements or abuse of dominant positions or concentrations. This revolution, which strengthens the economic analysis, comes in addition to earlier measures that create an autonomous economic service introducing "devil's advocates" (who have the specific task of challenging or criticising the conclusions reached by their colleagues).
As one can see: - reform is sufficiently radical to even turn the direction of certain aspects of European competition policy around. Political decision-makers cannot pretend it is not there. (F.R.)