Strasbourg, 16/03/2006 (Agence Europe) - During the debate on Wednesday evening which followed Competition Commissioner Neelie Kroes' statement on the recent mergers which have caused so much controversy in Europe (see EUROPE 9152), several MEPs spoke strongly against what is called “economic patriotism” and called on the Commission to act forcefully, while others wondered about the effectiveness of the takeovers directive and whether it needed to be amended. Austrian Secretary of State Hans Winkler said he was sure that the European Commission would conduct itself in a responsible manner and insisted that, in the internal market, “dynamic” competition must be allowed to develop, Europe must “arm itself for the future” and must not neglect medium- and long-term issues. Chairwoman of the economic and monetary committee, French Socialist MEP Pervenche Berès, agreed fully on that last point, saying that it was necessary to integrate “medium- and long-term objectives which unshackled liberalism cannot ensure”. The President of the Council pointed out elsewhere, that, in the EU, there were 320 million companies (99% of which were SMEs, providing 80% of jobs), and “every day” new companies were being created while others were being lost. He said it was necessary to pursue more keenly a European competition policy.
German Christian Democrat Klaus-Heiner Lehne put the ball back in the Council President's court: the Council has also to become involved in this issue, he argued, since, ultimately, there was a limit to what the Commission could do. Dutch MEP Ieke van den Burg said that in the Socialist group, “we still believe that the state has a role to play, not take a front role, but through silent diplomacy, dialogue with companies, as facilitator”. She told Mrs Kroes that they did not like her approach, which was “too negative”, and added that a debate on industrial policy was needed. Vittorio Prodi (ALDE, Italy) considered that a dimension leap was needed, there had to be a “continental dimension” and he insisted on the need for truly European gas and electricity networks. Luxemburg Green MEP Claude Turmes said that he understood Italy and Spain's “anger” at the attempt to block ENEL's transaction with Suez and Endesa's attempt on E.ON, and he denounced “French and German energy imperialism”. He believed “European energy champions would squeeze more money out of consumers”. “Neither liberalism nor protectionism”, said Roberto Musacchio (GUE/NGL, Italy) deploring the fact that Europe was struggling to develop an innovative energy policy. Adam Jerzy Bielan (UEN, Poland) vehemently defended his country's attitude in the Unicredit affair, asking for a stop to “false accusations against Poland”. Forza Italia MEP Antonio Tajani denounced the “protectionism” shown over the last few months and called on the Commission to be “firm” against protectionist states taking advantage of others' laudable opening. States which blocked mergers in fact wanted “to protect weak companies or artificially create national energy champions, with serious consequences for the nation, because protectionism certainly holds no promise for jobs,” he argued. “France already has its national energy champions, it doesn't need any more,” said Umberto Pirilli (UEN, Italy) and he pointed out that, on many issues, the Commission had acted strongly. “Suez/GDF have to be told that monopolies are not allowed,” said Ivo Belet (EPP-ED, Belgium), telling both French companies, “all of Belgium has its eyes on you” (because of what will happen to Electrabel) and “the Commission is our last defence”. Talking about the Suez/GDF transaction, Iles Braghetto (EPP-ED, Italy) spoke of “fratricidal struggle” and reproached France for wanting to create “a new energy colossus”. “Spain needs more competition, not protectionism,” complained Jose Manuel Garcia Maragallo (EPP-ED, Spain), reproaching the Spanish Socialist government for its part in the Endesa affair, going as far as to say that in Spain, conditions were the same as in a “banana republic!” He too called on the Commission to act with strongly. Speaking about national interests used to block hostile takeovers, CSU MEP Alexander Radwan, alluding ironically to the 2005 transaction involving Danone, asked if yoghurt could be of national interest. He said that Member States were being hypocritical, claiming: we protect ourselves at home and go and do business abroad. Spanish Socialist Manuel Medina Ortega asked his fellow MEPs if, when talking about the sacrosanct principle of free movement of capital, they had read the Treaty and if they knew it also spoke about solidarity, cohesion and employment. He went on: Article 4 of the hostile takeovers directive allows for “exceptional measures” in certain circumstances. Pervenche Berès (Socialist, France) said to Commissioner Kroes, “if you want the market to work effectively, you have to give up frantic liberalism” and “consider a review” of the hostile takeovers directive, so that “shareholders' power is not blind power”.
Should the directive be amended? We are consulting on whether it would be “wise to modify the two thirds rule,” said Neelie Kroes in response, stressing that the aim was “equal treatment, with no one more equal than the other. We will be tough”. Recognising that, in the energy sector, the current situation was somewhat “hectic”, the Commissioner repeated that notification had not yet been received and that action would only be taken on competition grounds. She stressed that Member States which do not apply the rules will have “tough” treatment, and that the impact of mergers would be examined on “a case by case basis”.
Hans Winkler announced that a Competition Day, under the title “Do mergers keep what they promise?” would be held in Vienna on 19 June. Commissioner Neelie Kroes and Minister Martin Bartenstein would both attend.