OPP Meeting Summary: Hearing of Margrethe Vestager, Executive Vice President-designate for Europe fit for the Digital Age (8 October 2019)

A summary of the hearing is now available.

Hearing of Margrethe Vestager, Executive Vice President-designate, Europe fit for the Digital Age – 08 October 2019
– Joint ITRE/IMCO/ECON hearing: (JURI associated)


Margrethe Vestager, Executive Vice President-designate for Europe fit for the Digital Age

  • she had always worked for a fair and just society, where people can make their own choices, and follow their dreams, with proper respect for those around them. If confirmed she would continue to do so;
  • she believed common goals were best achieved when working together;
  • she was very happy to see the first gender-balanced Commission;
  • big challenges were ahead, such as climate change and digitalisation. Global competition was also getting tougher, so it would be necessary to work harder than ever to preserve a level playing field;
  • she pledged to not to make Europe more like China or the US, but to make Europe more like herself, built on its own strengths and values;
  • times were challenging in terms of competition enforcement: the principles guiding competition rules are as relevant as they were when the Treaty of Rome was signed, but it was necessary to ensure that the way those principles were applied was fit for a world changing fast;
  • she intended to move forward with the review of rules on antitrust, mergers, and state aid. In the process, she would be helped by the insights gained from studying how digitisation affects competition, including the independent report delivered by three special advisers earlier in the year;
  • however, competition alone was not enough: an industrial strategy was necessary. Such industrial strategy needed to be based on openness and diversity, be for everyone, green and based on fair competition, and would include a SMEs strategy;
  • she stressed that the public and private sectors needed to team up to get the best out of each other through public procurement and more funds for innovative research;
  • this strategy needed to reach beyond the single market, and the EU was in a strong position to work towards a global level playing field, including pursuing the proposal for WTO reform and to ensure that foreign state ownership and subsidies did not harm competition in Europe;
  • a good industrial strategy would also make Europe fit for the digital age. There were two types of businesses in Europe: those that are already digital and those that would soon be;
  • the digital transformation had enormous potential, but the right rules were needed to give people confidence in it. The digital transformation also needed to respect citizens and respect fundamental values, especially trust, humanity and fairness;
  • with regard to trust
    • it was necessary to engage with people’s fears about technology
    • she would work on the Digital Services Act to upgrade liability and safety rules on digital platforms, services and products;
    • it was necessary to regulate the way companies used, collected and shared data;
  • with regard to humanity:
    • rules were necessary to ensure that AI is used ethically;
    • she would put forward proposals developing the European approach to Artificial Intelligence within her first 100 days of office;
  • with regard to fairness:
    • fair working conditions for platform workers and fair taxation for digital companies needed to be ensured;
    • digital taxation rules needed to be based on global agreements, however if this was not achieved by the end 2020 they would be ready to act.

Andreas Schwab (EPP, DE)

  • the digital single market was full of hidden stars that unfortunately often were not able to shine for long;
  • the online platform economy had brought many advantages but there were still regulatory barriers in place which were obstacles to companies to grow quickly;
  • this was not just the case for the digital economy – increase in unfair competition could be seen from all around the world, which called for “European Champions”;
  • he asked whether the Commission would continue with its current approach to mergers or would facilitate European companies vis-a-vis companies receiving investments from outside the EU.

Ms Margrethe Vestager

  • there was a dual challenge: (i) ensuring fair competition within the EU single market, (ii) ensuring that European businesses could stand up when they were faced with unfair competition from third countries;
  • some actions had already taken places, for instance when the Commission suggested a change in the approach to China;
  • she would work with her colleagues to secure approval of the International Procurement Instrument to ensure reciprocity and to ensure that investments in Europe were done for the right purposes;
  • one of the open questions was ensuring that foreign state aid was not undermining the level playing-field through that state-owned companies from abroad;
  • she would work with the Internal Market and the Trade Commissioners on the issue.

Andreas Schwab (EPP, DE)

  • he was pleased interim measures were being considered: the EP had called for it many times;
  • he asked whether competition rules would be used more quickly in the future, especially in the digital sector, to prevent abuse of dominant positions.

Ms Margrethe Vestager

  • she agreed that markets were moving fast, while the law not so much, and this had been an area of frustration and where she intended to work on;
  • a case was now on the table where interim measures were being considered for the first time in 20 years, showing the need for speeding up the work;
  • she was however not willing to compromise on the due process to be followed.

Paul Tang (S&D, NL)

  • the current corporate tax system was outdated and multinationals and tech giants hardly paid any taxes;
  • he asked whether she would push for a European digital services tax if international negotiations failed to produce results;
  • he also asked whether she would continue pursuing taxation state aid cases even after the Starbucks ruling by the CJEU;
  • American tech giants seemed to view fines as nothing more than a cost of doing business, while there seemed to be no European competitors in sight and data being used at the mercy of commercial use;
  • he asked what she would do to change that while at the same time ensuring protection of data.

Ms Margrethe Vestager

  • she hoped member states were listening to his concerns about unfair taxation;
  • to tackle the issue legislation on corporate taxation needed to be changed;
  • she vouched to continue working on state aid cases on unfair taxation. The Commission had asked member states to provide updated information on how they used tax rulings;
  • she hoped a global agreement on digital taxation could be found, but if that was not the case the EU would be ready to act by itself;
  • with regard to his comment on fines, she stressed that fines were only part of the picture: looking forward companies would be prohibited from acting in ways having the same effect as behaviour for which they were punished, and the Commission would have more options in the toolbox and would get wiser and better at finding ways to re-instate competition.

Paul Tang (S&D, NL)

  • he asked what she expected to work in stopping the monopoly of tech giants;
  • he stressed that the EP had called multiple times for breaking up companies like Google and Facebook and asked if this option was being considered.

Ms Margrethe Vestager

  • breaking up companies was a tool available to the Commission, but she also had the obligation to use the least intrusive tool to restore competition;
  • it was therefore a remedy of last resort.

Nicola Beer (RE, DE)

  • AI was a promising technology that could benefit many people for instance in the health, education or transport sector;
  • she asked if she believed that the potential of AI should be used because of its significance, notwithstanding the challenges and the risks;
  • she also asked how the EU could become a leader in AI in the upcoming five years.

Ms Margrethe Vestager

  • she agreed on the potential of AI, but she also saw the risks. Moreover, Europeans were losing trust in technology;
  • the work of the Commission would be informed by the results of the HLEG on AI and how European businesses had taken up on the seven guiding principles developed by the HLEG in the Ethics Guidelines on Artificial Intelligence;
  • the final results of the HLEG, looking at how companies had taken up the seven principles, would be published in December 2019;
  • she stated that in AI some said China had all the data and the US had the money, but Europe had purpose;
  • the first question to be answered was in fact where AI needed to be used, and then data and funds would be made available for that purpose.

Nicola Beer (RE, DE)

  • she asked how member states’ resources would be pooled for advancements in AI and to avoid fragmentation.

Ms Margrethe Vestager

  • the first short-term priority was the MFF, for which the Juncker Commission had proposed an increase in investments;
  • the second way was using public procurement more strategically;
  • Europe also needed to build upon the already existing “innovation hubs”.

Alexandra Geese (Greens/EFA, DE)

  • she asked if in the work on the Digital Services Act she would commit to the high fundamental rights and data protection standards set by the GDPR;
  • she also asked how seriously she would fight the power imbalances between citizens, consumers and tech companies, and whether she would work on taking data exploitation practices such as micro-targeting completely off the table.

Ms Margrethe Vestager

  • there was a lot to do on the subject of surveillance capitalism;
  • she supported what had been done (ie Code of Conduct and Code of Practice) so far because it had been necessary to act fast in light of European and national elections;
  • there was a lot to build upon, but she did not know yet into details what would be the precise content of the Digital Services Act;
  • it was also necessary that national authorities ensured full enforcement of the GDPR so to create a market response;
  • citizens also needed to be informed and aware of what kind of life and democracy they wanted.

Alexandra Geese (Greens/EFA, DE)

  • she asked how the proposals on AI would ensure that algorithmic systems were not discriminatory, especially when it came to biased datasets.

Ms Margrethe Vestager

  • she shared her concern, and stated she would usually say “you can have your AI when I have a gender-balanced society”, as AI was not any wiser than the data fed to it;
  • there was therefore a risk of cementing the already existing inequalities;
  • one of the principles of the Ethics Guidelines on Artificial Intelligence addressed this particular issue, stating that if AI was not designed to get rid of the biases then it required human oversight;
  • the question of biases would be at the core of the future proposals.

Alessandra Basso (ID, IT)

  • she believed her goal of creating a global level playing field for competition to be too ambitious;
  • she criticised her and the Commission for the work done and the decision taken on the state aid case Banca Tercas, which led to the collapse of four banks and affected many consumers;
  • she asked what instruments would be developed to create a global level playing field for competition.

Ms Margrethe Vestager

  • the banking sector had been the most affected by the financial crisis, and even if things were going better, they were not completely back to normal;
  • every case was different, but she had always worked to protect taxpayers and as much value as possible. This did not change the fact that once in a while a bank might leave the market and that would be painful, especially when misselling had taken place so consumers thought they were protected when they were not;
  • the Commission had tried to arrange schemes to protect consumers affected by misselling practices.

Alessandra Basso (ID, IT)

  • she asked if there would be a review of the Guidelines on state aid in the maritime sector, which was not included in the Fitness Check of January 2019.

Ms Margrethe Vestager

  • the Guidelines on state aid in the maritime sector would continue to work as they were, but this did not change the fact that the Commission would continue to work on the maritime sector. For instance, the Commission had been working on ensuring that the tonnage tax stayed legitimate;
  • it needed to be ensured that the tonnage tax was being used for shipping activities, while there had been cases where it had been used for other purposes;
  • state aid the maritime sector was not included in the January 2019 Fitness Check as it was subject to a separate public consultation.

Derk Jan Eppink (ECR, NL)

  • he wanted to know how she would avoid conflict of interests between the Competition portfolio and the Executive VP for a Europe fit for the Digital Age portfolio;
  • he believed that competition enforcement required a neutral position, while industrial policy meant supporting specific sectors and companies in the form of an industrial strategy.

Ms Margrethe Vestager

  • that was the first question she had also asked herself before accepting the nomination;
  • the Commissioner for Competition had always been part of the College of Commissioners, and every decision taken was a collegial decision;
  • this two-level legal scrutiny (by the Commission College and a potential Court scrutiny) had been found compliant with human rights by the CJEU;
  • as to her work on the daily basis, she would have the independent advice of the Chief Economist and the Legal Service.

Derk Jan Eppink (ECR, NL)

  • he asked if she believed the EU could learn from US competition policy and if yes, in which areas and how;
  • he stressed that competition policy in the EU and the US had the same objectives but different methods: the EU had an administrative system for antitrust enforcement, while the US relied on criminal law, merger control was more centralised in the EU than in the US, and the EU had strict rules on state aid while the US had no provisions on the subject.

Ms Margrethe Vestager

  • the EU had learned quite a lot from the US on a case-by case relationship, for instance in the clearance of merger case to ensure that if remedies were needed, those would work both in the EU and the US;
  • the methods were indeed different, but the basic ideas were the same. The EU had actually initially developed fields such as antitrust or merger control from the US;
  • state aid was a European specificity, but questions started to be raised in the US too, especially with regard to tax breaks given to companies to place their headquarter in a certain state.

Martin Schirdewan (GUE/NGL, DE)

  • the GUE group was in favour of fair corporate taxation;
  • the EP had produced a draft in the 8th Legislature of how a digital services tax could look like;
  • he asked how she would tackle the issue in the G20 framework, whether there would be a European initiative on the matter and how an eventual blocking Council would be overcome.

Ms Margrethe Vestager

  • it was difficult to be optimistic when it came to European tax legislation: it was a process that took a long time and even when agreed up it took a long time for implementation;
  • yet, she was surprised by the progress made since the time she was chairing the ECOFIN Council under Denmark’s Presidency;
  • 14 pieces of tax legislation had been adopted by the Council during the 8th Legislature by unanimity, so it was not undoable;
  • the problem was that very important pieces of legislation had not been adopted, such as the CCCTB and the public country-by-country reporting;
  • she was still hopeful for a global agreement, but if that was not the case the Commission was ready to table and propose its own solution.

Martin Schirdewan (GUE/NGL, DE)

  • he asked whether she would support modifying the legal basis to Article 116 TFEU make decisions on the matter by QMV and no longer by unanimity.

Ms Margrethe Vestager

    • there was the possibility of using Article 116 TFEU, the Commission needed to start exploring what it would entail;
    • she stressed it would not be a given that the outcome would be successful but it was important to explore the tools provided by the treaties.

Second round of questions


Markus Ferber (EPP, DE)

  • mentioned the executive vice-president role, the broad portfolio, three committees which potentially could inflict conflict of interest;
  • pointed out that under the Juncker’s Commission there were dossiers which were not available and asked how Vestager was going to address that inherited conflict of interest.

Ms Margrethe Vestager

  • the working arrangement in the previous Commission was that she could take a number of decisions by empowerment but also responsible to her colleagues. The College took important decisions together. So far there were no in dept discussions on competition decision in the College but they had followed every procedure and went through the different steps, so it was a true collegial decisions;
  • agreed on the impressive portfolio she would going to have but stated that the legislative proposals would be with her colleagues. Although she would work with them, when it came to individual proposals, her colleagues would write those.

Markus Ferber (EPP, DE)

  • pointed out that digital markets developed very quickly and competition procedures went a lot slower;
  • asked if Vestager thought that faster competition procedures were needed for the digital world;
  • mentioned the 6 years the Commission spent on Google and pointed out the long period of market domination before the response from the DG.

Ms Margrethe Vestager

  • mentioned the start of the procedure of intermediate measures;
  • pointed out the experience of the UK and the Netherlands having a different ways to reorganise a market place, if the competition authority found the way the market was working was not beneficial for fair competition. Those were tools that could be considered in order to reorganise the market before harm was done. In that way one did not punish, if no infringement was found but one could give very direct almost orders to how a market should be organised;
  • she highlighted that sometimes the competition was not only within the market but for the market and when one won the market they become the private regulator (for example the market for search won by Google in Europe).

Christel Schaldemose (S&D, DK)

  • pointed out that the digital platform workers would be enjoying more workers rights but wanted to know how children were going to be protected from online gambling.

Ms Margrethe Vestager

  • said that people who worked on digital platforms had very bad working conditions. Those people who were similar to independent workers could be organised. National competition authorities were not enough because that was a pan-European question, one could work for a platform in many different MS, so it was important ensuring the right to be organised as a worker;
  • regarding online content, there was illegal content and damaging content with the intention to distort the public debate in elections for example. Vestager stated that different approach for different content was needed and mentioned the Code of conduct that could address some of the worst abuses.

Christel Schaldemose (S&D, DK)

  • asked what the citizens, consumers and workers would notice in 5 years time, how would they know that Europe was fit for the digital age.

Ms Margrethe Vestager

  • if the Commission would like to have a concrete impact, the Parliament would have to work with it ensuring that anything which was adopted was actually implemented and that there was a follow-up on the implementation.

Morten Løkkegaard (RE, DK)

  • asked how the SMEs could be supported with perhaps less burdens of a legislative nature;
  • wanted to know what Vestager would do in concrete terms to support those SMEs to develop their full potential in the digital economy.

Ms Margrethe Vestager

  • agreed that the differentiation between what legislation should applied to large and to small enterprises. The Parliament had been also following that line in a what of legislation because the SMEs were the majority of enterprises;
  • on the things that could be done in order to support the SMEs was ensuring the full exploitation of the public procurement rules. The Juncker  Investment Plan had ensured contracts for 900 000 SMEs;
  • highlighted that the access to qualified employees was underestimated. That was why training and education were so important, especially when talking about digital skills.

Morten Løkkegaard (RE, DK)

  • pointed out the importance of the legislation not burdening SMEs.

Ms Margrethe Vestager

  • said she would like to work on that. Reducing the administrative burden was very difficult and the best way to do so was to prevent its existence. Digital solutions could also work in reducing red tape;
  • she hoped for assistance from the SME business envoy which would be focusing precisely on that matter.

Pilar del Castillo Vera (EPP, ES)

  • she stated that through competition law, the EU had done a lot in terms of access to digital infrastructure. The digital infrastructures, however, such as app stores, digital wallets for payments or search engines had become a critical gateway creating a number of barriers to compete, innovate or reach customers;
  • she asked what would be done in order to eliminate the new bottlenecks such as inflexible terms for access, limited access to operation systems’ functionalities or access to users’ certain actions data.

Ms Margrethe Vestager

  • she stated that there was a digital divide that had to be closed to keep investing also outside of areas where there was a thorough business idea. There was a gatekeeping also in the physical infrastructure very present for a number of people;
  • the legislation platform-to-business was coming into effect by summer next year. It would allow businesses depending on a platform to have transparency on rankings, have access to a dispute solving mechanism;
  • she pointed out that when de facto one owned the market, the rules they set was not ensuring fair competition but it was “my own product first”.

Pilar del Castillo Vera (EPP, ES)

  • she stated that in the context where Europe’s competitiveness was a target to intense international competition, an European industrial agenda with visible targets, concrete figures, date and a specific actions was urgently needed;
  • she asked if Vestager were to implement a strong industrial policy if  she saw a need to adapt Europe’s competition policy or rules.

Ms Margrethe Vestager

  • a specific example of how the EC was using rules now was the work with MS to create those important protections of common European interest;
  • the Battery Alliance was a good example of that. The focus was not on specific sectors but on area where a market error was found and the full value chain could come into effect. That was a very good example of a competitive-based industrial strategy.

Eva Kaili (S&D, EL)

  • she pointed out that the European Commission President-elect used the term technological sovereignty. She asked how the EU could remain open to innovation and avoid the trap of over-protectionism;
  • regarding reciprocity and state aid, Kaili wanted to know what tools Vestager had in mind to design;
  • asked if redefining what constitutes ‘abuse of dominant market position’ in the digital era by expanding it so that possession of data is included as an element in the current law was crucial.

Ms Margrethe Vestager

  • on market power Vestager stated that the EC would expand its insights as to how this works, and we have learned a lot from some of the merger cases that we have been doing, to see how data can work as an asset for innovation and also as a barrier to entry;
  • pointed out that if one did not have the right data, it was very difficult to produce the services that people are actually asking for. That became increasingly critical when it came to AI;
  • mentioned the use of publicly funded data. If one had a lot of of it, then they also had the capabilities and the technical insights to make very good use of it. The supercomputing investment was very important in that respect;
  • said that both Galileo and Copernicus’ data could be of use not only to big players but also for the smaller ones like farmers etc.

Eva Kaili (S&D, EL)

  • asked if in the field of AI Vestager thought that Europe could become a global player on development and deployment while enforcing high ethical standards across the industry by law or by design. She gave protecting citizens who were being excluded by insurance companies based on an AI ranking as an example.
  •  wanted to know how the EU could avoid a simplistic one-size-fits-all framework for the use of data across completely different industrial sectors, like defence or the creative and health sectors;
  • stated that people were  unaware of data being collected from their microphones or cameras while  not using applications and asked if citizens shouldn’t have more options;
  • asked for further elaboration avoiding over-protectionism.

Ms Margrethe Vestager

  • stated that the EU could not be a world leader without ethical guidelines.
  • the AI the EU created was a AI with a purpose. Health care, environment, mobility were the areas where Europe was good at. Europe had a lot to build on, but tended to see those as invisible assets that had to be appreciated. In that way trust among society was builded;

Molly Scott Cato (Greens/EFA, UK)

  • she was delighted that President-elect Ursula von der Leyen had committed to proposing a European Green Deal in her first 100 days;
  • it was necessary to ensure that competition rules supported, rather than inhibited, investment for the climate;
  • she asked how the adaptation to a climate transition would be supported in the revision of the State Aid Guidelines governing the energy sector, specifically whether she would establish an internal audit system for checking the consistency of state aid decisions with the EU’s decarbonisation targets;
  • she also asked whether she would restrict disguised aid granted to fossil fuels, such as closure aid for coal mines and compensation for stranded assets to ensure GHG reduction;
  • finally, she asked whether she would broaden the scope of environmental aid under the General Block Exemption Regulation, excluding from its scope aid granted to airports.

Ms Margrethe Vestager

  • the Commission had started a full first fitness check and would eventually do a review of a huge number of state aid guidelines;
  • ahead of that were the ETS Guidelines, to be ready for when the new trading system started;
  • within a short period of time they would start a public consultation, the goal being that few sectors as possible could be compensated for direct or indirect costs of emissions;
  • this would also needed to be done taking into consideration the carbon border tax;
  • the Green Deal would obviously be part of the considerations;
  • however, she stressed that it was not the Commission that gave state aid, but member states. The Commission checked that state aid did not harm competition, and the state aid guidelines were part of the entire Green Deal framework that Member States signed up to;
  • with regard to the airports question, she believed they would remain under the General Block Exemption Regulation.

Molly Scott Cato (Greens/EFA, UK)

  • she asked if she intended to complete a long-overdue revision of the 2013 Banking Communication in order to align it with the resolution framework, so to ensure that money that is urgently needed for the Green Deal was not diverted towards bankrupt institutions.

Ms Margrethe Vestager

  • data seemed to show that fewer and fewer banks were getting into trouble, and that obviously was a good thing. However, it also showed that Member States were putting in place schemes that were not state aid, but market conformity measures, investing as a market investor would do, which had been quite helpful in order to get rid of some non-performing loan portfolios;
  • the Banking Communication was still fit for purpose in a number of areas, and there would still be an element of state control, also when the full banking union would be in place;
  • the Commission was careful not to over-rush the Banking Communication;
  • Member States were really investing in renewable energies. Sometimes they were making a capacity mechanism out of it, but this was within the purpose of investing big time in renewables.

 


Herve Juvin (ID, FR)

  • Europe was not ahead of the game in digital technology and AI and never in the history of economy a country was able to catch up without protectionist measures;
  • he asked how she would help Europe to catch up without abandoning the dogma of free trade, without calling into question a certain number of existing treaties and without building an efficient external market border as the Chinese and Russians were doing.

Ms Margrethe Vestager

  • one of the reasons that businesses were growing was precisely because they could trade, and 2/3 of EU trade was actually intra-EU;
  • there were disparities in the level of digitalisation of member states, so there was some catching up to do, also through investments;
  • however Europe had a big strength in the B2B sector, so there was something to build on, not necessarily just to catch up;
  • obviously European programmes also needed to be financed, so she called on MEPs for help in passing the MFF.

Herve Juvin (ID, FR)

  • China and America considered the combination of biotechnologies and AI the battle of the future;
  • he asked if she was planning to develop the subject, which required interdisciplinarity, in the future Commission.

Ms Margrethe Vestager

  • Commissioner Gabriel would be in charge of (hopefully) a giant research programme;
  • Horizon Europe would help interdisciplinary projects.

 


Evzen Tosenovsky (ECR, CZ)

  • he asked whether she would ensure that the selection of centres of excellence for AI under Horizon 2020 would be geographically balanced;
  • the benefits of AI also needed to be enjoyed by all the member states and not just by few countries.

Ms Margrethe Vestager

  • everyone needed to be part of the AI development: it was just as important that AI was not biased geographically as it was important that AI was not biased on gender;
  • the Commission had had a number of good ideas, such as the creation of a network of innovation hubs;
  • Commissioner Gabriel was responsible for it and knew the details better, but she would be part of the effort;
  • she stressed that excellence needed to be the driver.

Evzen Tosenovsky (ECR, CZ)

  • he wondered whether the 100 days objective for AI proposals was not too ambitious, especially as a broad public consultation was mentioned: the ECR Group preferred to not rush things.

Ms Margrethe Vestager

  • it was indeed ambitious;
  • to build trust it was necessary to listen to figure out was as the right approach and be careful not to over-regulate and hamper innovation;
  • however, it was also necessary to listen fast and get the AI strategy off the ground.

Arba Kokalari (EPP, SE)

  • concerning the Digital Services Act, which would include liability and safety rules for digital platforms, she asked whether she would propose new rules concerning the principle of responsibility and a duty of care;
  • if yes, she asked how she would ensure that these rules were proportionate and justified and that they ensure the freedom to provide services;
  • she also asked whether she would modify the ‘notice and take down’ procedures, and, if so, what the solutions would be to ensure that the new rules to protect consumers from being deceived were effective but also business-friendly.

Ms Margrethe Vestager

  • the first step was taking stock of what existed already and knowing what needed to be achieved: a lot of legislation already existed for instance on safety rules etc;
  • the important part was ensuring that things were not re-done, especially since there had been a divisive debate on Copyright recently.

Arba Kokalari (EPP, SE)

  • she asked if the Digital Services Act would also include AI-enabled services or whether these would be part of the European approach to AI;
  • she also asked if the Digital Services Act would be proposed as a Regulation rather than a Directive, to ensure a greater level of harmonisation.

Margrethe Vestager

  • she did not know yet whether a Regulation of a Directive would be chosen as the best option;
  • she did not know yet how the Commission would deal with AI-enabled services, but the goal was ensuring that consumers could trust and be in control of products.

 


Stéphanie Yon-Courtin (RE, FR)

  • big fines against tech giants were not effective, as they were shifted on consumers;
  • she thus asked what remedies she would envisage against anti-competitive practices of tech giants, and whether she would advocate for breaking them up;
  • she also asked how she intended to stimulate the rise of European companies so that they could become part of the top 10 of the digital economy and whether she was in favour of obligations for accessing and sharing data for the benefit of consumers and SMEs.

Ms Margrethe Vestager

  • she agreed that fines were not doing the trick, also because fines were a punishment for past behaviour when the goal needed to be creating change for the future;
  • she would look into whether stronger remedies for competition were needed to pick up in the markets;
  • for instance after the Google AdSense case, Google had stopped its illegal behaviour but the market had not picked up even two years later;
  • she repeated that breaking up companies was a tool available to the Commission, but she also had the obligation to use the least intrusive tool to restore competition and it was therefore a remedy of last resort;
  • one thing that needed to be considered was that there was now not only competition in a market, but also competition for a market, which if won meant being the de facto rule-setter in the market;
  • the platform-to-business proposal aimed at ensuring rules for fair competition.

Stéphanie Yon-Courtin (RE, FR)

  • competition policy needed to be less compartmentalised to allow the emergence of European leaders;
  • she asked how she intended to amend state aid rules to encourage developments of industry and innovation through Projects of Common Interest such as the one on batteries;

Ms Margrethe Vestager

  • existing rules were the best way to enable Projects of Common European Interest;
  • the work on these projects was quite complex and member states and the Commission were still getting acquainted to it;
  • there were a number of European Projects of Common Interest waiting and it would not be wise to take a step back;
  • with regard to the first question on the top 10 companies, ten years ago they were fossil fuels and banks, with the top one being Dutch Shell;
  • so the question needed to be what list European companies wanted to be on: the most important global companies in greening the economy were European, and in the digital sector European companies were leading in B2B.

John David Edward Tennant (NI, UK)

  • the ideas expressed on taxation represented everything that was wrong with the EU;
  • the UK had joined for free trade and a common market, and now all they saw was European taxation without fair representation. This was unacceptable and leading towards censorship;
  • the EU was pro-harmonisation, the Brexit party was pro-sovereignty.

Ms Margrethe Vestager

  • she did not share his views.

Evelyn Regner (S&D, AU)

  • in her opening remarks, she mentioned she planned to change the application of competition rules but not the underlying principles;
  • she asked how she then planned to deal with issues of abuse of dominant market position by tech giants, or the issue of companies posting workers to other Member States to pay less social security contributions;
  • she asked whether she would tackle the issue like she did for tax-dumping practices.

Ms Margrethe Vestager

  • the question illustrated very well the limits of competition and law enforcement and the need for a well-functioning labour market;
  • she believed competition law could not solve the posted workers issue, but she appreciated the work that the Commission had done on remuneration for posted workers.

Evelyn Regner (S&D, AU)

  • she asked what she intended to do if the CBCR was adopted and whether she would commit to working on a European minimum corporate tax rate in order to end the race to the bottom.

Ms Margrethe Vestager

  • the work on taxation was indeed slow, but progress were eventually made;
  • she hoped that member states and companies took guidance from the state aid decisions of tax;
  • the Commission had also issued guidance on how to understand aids;
  • she however stressed that she did not believe state aid cases would bring tax justice, only legislation would do that;
  • in that respect, a combination of CBCR and a combination of a minimum corporate taxation and a common tax base was necessary.

Angelika Niebler (EPP, DE)

  • she asked what was her opinion on the Copyright reform and whether she would ensure that the implementation of the Directive was not weakened by the member states;
  • she also asked what would be the relation between the Digital Services Act and the Copyright reform.

Ms Margrethe Vestager

  • she had not been in charge of the work on the Copyright reform but she had followed the debate, which had been very divisive. She stated she was happy with the outcome;
  • the Commission will be in charge of providing guidance on national implementation to avoid fragmentation. She expected it to be a very difficult task and for many of the debates to come back;
  • the copyright issues should not be re-opened by the Digital Services Act.

Angelika Niebler (EPP, DE)

  • she asked how the Commission intended to tackle the issue of illegal online transmissions of sport broadcasts.

Ms Margrethe Vestager

  • she was not prepared for that question, even though she believed she had prepared well;
  • it was an important issue but she would need time to come back with an answer.

Cornelia Ernst (GUE/NGL, DE)

  • she asked what role competition policy would play for regions: not all regions were competitive and regions that were transitioning out of coal for instance and aids and competition needed to be balanced.

Ms Margrethe Vestager

  • competition was only part of the answer and had its limitation;
  • for regions in transition investments were needed;
  • she strongly supported the Globalisation Adjustment Funds.

Cornelia Ernst (GUE/NGL, DE)

  • she asked what the European industrial strategy would do for structurally weak regions;
  • Vestager had mentioned elements of the industrial strategy, but had not provided the big picture.

Ms Margrethe Vestager

  • first, it was necessary to ensure that such a strategy was not just for big business, because Europe was not just big business;
  • second, the strategy needed to be part of the Green Deal;
  • last but not least, it had to be on a foundation of fair competition, meaning that it was not about handing money out to some business or to some sector, it was to invest in the value-change that enabled a number of different sectors to prosper. A good example of this was the Important Project of Common European Interest in microelectronics.

Tiemo Wölken (S&D, DE) 

  • pointed out that businesses argued in favour of less regulation in order to allow for, and boost, the development of AI technology;
  • stated that as the main EU instruments governing AI today were GDPR and the ePrivacy Directive, it should be underlined that any initiative from the Commission had to fully guarantee the respect of fundamental rights, such as the protection of privacy and personal data or non-discrimination;
  • asked how Vestager would ensure that a Europe fit for the Digital Age did not undermine existing regulation or protection of fundamental rights but used those protections as a competitive advantage.

Ms Margrethe Vestager

  • stated that the only way that the EU could be successful was to build the AI that it could trust, based on fundamental values;
  • underlined that it was talked about ‘privacy by design’, but the EU should also talk about ‘trust by design’, otherwise it would be rejected. That would be a pity, because the potential in health, in minimising pollution, and in fighting climate change when it came to using digital technologies, including AI were enormous;
  • the guidelines that the EU started with on how to create trusted AI had to be put into assessment schemes;
  • a lot of businesses saw the need of regulation but that regulation should be one that enabled,  not disabled then; Businesses saw the same perspective: Europe did not have all the data or all the money but Europe had a purpose.

Tiemo Wölken (S&D, DE) 

  • stated that in the digital age it was vital that the EU gave power back to the individual to decide what was to be done with their privacy instead of making it a pure commodity;
  • pointed out that e-Privacy directive in order to let the individuals keep their right to self- determination and decision-making, free from influences they have not agreed to was needed;
  • with the e- Privacy directive the advertisement-driven business models we knew would be regulated without waiting for the market response;
  • asked how Vestager would ensure that an agreement could finally be reached on the much-needed regulation on e-Privacy;
  • wanted to know how the EC would ensure that the upload filters in the Copyright Directive would not endanger the freedom of speech during its implementation by MS.

Ms Margrethe Vestager

  • on the Copyright Directive, a lot of discussions between MS, the Commission and the Parliament to make sure that the implementation in MS was similar, instead of having one variant of the Copyright Directive in one MS and a quite different variant of it in another MS;
  • highlighted the importance of the debate between the freedom of speech and protecting people who had rights. That debate was a one one could settle and then it would come back because just like we had fundamental values, we also had fundamental discussions;
  • she highlighted the importance that the EU did not to just decentralise the enforcement of rights to the individual citizens. The EU had to do more for people to feel empowered to protect themselves.

 


Damian Boeselager (Greens/EFA, DE)

  • wanted to know what Vestager meant by developing tools to guarantee fair competition both in the single market and at the global level and  reexamining the practical aspects of our enforcement, including aspects such as market definition’ in her response to the EP’s questions;
  • asked if Vestager had changed her opinion and more concretely if she would, after such a re-examination of the market definition, rule differently on a case like the Siemens-Alstom merger.

Ms Margrethe Vestager

  • stated that the short answer was ‘no’. She explained that the thing in the Siemens-Alstom merger was not related that much to the merger itself but the fact that the companies could not or did not want to solve the competition problems they had;
  • the Commission was in line with the way those kind of assessments were done globally;
  • stated that it was very important for the EC to work with others on similar cases because the integrity of the single market came from a number of different sources;
  • pointed out that the public procurement market in Europe was 14-15% of European GDP and was worth EUR 2 trillion. She  stated that EU opened that market but other markets were not open for it.

Damian Boeselager (Greens/EFA, DE)

  • said that digital technologies, such as AI, presented substantial opportunities to help the EU economy become more climate neutral. Decentralised renewable energy production, or optimising energy usage, for instance, could help in getting away from fossil-based infrastructure;
  • asked what concrete policy measures Vestager would prioritise to support the development of digital technologies that contributed to fighting climate change;
  • wanted to know if the EC would limit the rebound effect of additional energy and raw-material consumption from digitisation.

Ms Margrethe Vestager

  • said that a lot had to be done within digitisation itself;
  • one of the things the EU was working on was a very important project on batteries, and one of the essential things was including the entire recycling practice in that area. Precious raw materials and the entire logistics of how one used batteries, became part of the innovative process;
  • stated that by pushing innovation a much better use of the technology could be made.  That would help the EU accelerate how it fought climate change.

Billy Kelleher(RE, IR)

  • asked where Vestager saw her strategy in terms of incentivising SMEs  to invest in upskilling their employees.

Ms Margrethe Vestager

  • said that work with national authorities was needed, creating programmes that allowed people to gain new skills while still employed, and in that, distance learning was part of the answer. MS could inspire one another and more people could be recruited to acquire digital skills;
  • the EC had to make sure that digital literacy, and also for women to come into the digital sector, was a question of priority.

Lídia Pereira (EPP, PT)

  • stated that society was going through huge changes caused by digitalisation;
  • pointed out that study data shows that citizens would back a European tax on digital services;
  • asked what Vestager’s vision on reform of digital services taxation in the EU was.

Ms Margrethe Vestager

  • on the question of digital services taxation reform, Vestager said that the EU indeed needed one. Many businesses paid their taxes, many of them SMEs.  They created the jobs, paid their taxes and taught young people their trade. In order to answer all those businesses that that was a level playing field, their digital competitors – with whom they competed for capital, skilled employees and customers – should contribute to the society where they did their business;
  • highlighted that she hoped for a global solution to the digital services tax. If that was not the case she considered that the EU should do it itself. The EU had committed to produce a proposal if there was not a global agreement by the end of 2020.

Lídia Pereira (EPP, PT)

  • asked how the EU could tax people that operated in one country and made money in another and transferred their income;
  • believed that when Europe moved into that area it would need an international agreement;
  • stated that the EU should not compromise its possibility in terms of innovation and attracting investment;
  • asked for more clarifications on how the actual digital services tax would function.

Ms Margrethe Vestager

  • said that the OECD were working on the matter at the moment;
  • the idea in the proposal of Pierre Moscovici was to say: ‘When you make value because you interact with your users in these many different countries, you should also contribute, with the profits that you make, to the country where your profits are enabled.’;
  • explained that since corporate taxation was invented before anything became digital, we had to make corporate taxation understand the world we lived in;
  • there was a sense of urgency, and that was also why it would have been best to have a global agreement. If that was not the case, then the EU should act on its own.

Margrethe Vestager made the following closing remarks

  • stated that while the MEPs were elected, she was selected so it was only with the EP’s acceptance that she had democratic legitimacy in doing the job that  she was supposed to do. That was why it meant a lot to her if confirmed, to be able to work with the Parliament and to strive to find solutions on very difficult issues.

Source: One Policy Place


The simultaneous interpretation of debates provided by the EU institutions serves only to facilitate communication amongst the participants in the meeting. It does not constitute an authentic record of proceedings. One Policy Place uses these translations so this text is only a guide and should not be relied on as an official account of the meeting. Only the original speech or the revised written translation of that speech is authentic.

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. Cookies help you create your Policy Newsfeed for example. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.

Close