What is the situation with competition area in EU?

The article discusses the need to change European Union competition rules because Europe's competitiveness is declining in the global market. Current rules are primarily focused on protecting consumers, but now it is being considered whether they adequately support the growth of European companies and their global competition. For example, it was highlighted how the European Commission prohibited the merger of steel producers Thyssenkrupp and Tata Steel in 2019, which was intended to protect against cheap Chinese steel. Now, both companies are facing difficulties, which has triggered a discussion on how EU competition rules could better support industrial policy.

Several influential figures, such as Friedrich Merz and Mario Draghi, have emphasized the need to change the merger control procedure to promote the emergence of strong European companies and accelerate innovation. Draghi has warned that if Europe does not change its approach, it could lose its position in the global economy. Brussels is indeed discussing the easing of regulations, especially in connection with the change of Competition Commissioner, as the new Commissioner Teresa Ribera may be willing to change the current consumer-focused policy to respond to the changed international situation, where other major powers such as the US and China are acting more aggressively. The EU's economic growth has been slower than that of the US and China, which is partly attributed to excessive regulations. A similar debate is also taking place in the United Kingdom.

The main question is whether to allow large European companies to merge to achieve greater scale and compete better internationally, even if this could harm competition or raise prices for consumers. Cecilia Bonefeld-Dahl, representing DigitalEurope, has said that Europe should focus less on regulating companies and more on supporting their development, because with the current rules it is difficult to create global technology companies.

At the same time, there is also opposition to loosening merger rules, as there are fears that this would give too much power to already large companies, harming smaller firms and consumers. Although the Commission has prohibited few mergers, some blocked transactions, such as the merger of Siemens and Alstom in the railway industry and the merger attempt between the London and Frankfurt stock exchanges, have raised questions about their political justification.

France and Germany have actively called for reforms, especially in the telecommunications and aviation sectors, to create larger European companies. European Commission President Ursula von der Leyen has tasked the new Competition Commissioner with modernizing competition policy, paying attention to innovation and aspects related to the defense sector. This may mean a more lenient approach to assessing mergers.

However, the European Consumer Organisation BEUC criticizes the idea of large European market-dominating companies, finding that it rather strengthens the position of existing market leaders. Internal resistance to reforms may arise within the Commission.

The article points out that the main purpose of merger regulation is to prevent the creation of excessive market power, not just to control the size of companies. Opportunities are also being sought to help smaller European companies grow without being taken over by US competitors. There are also plans to expand powers to prevent "killer acquisitions", which particularly threaten European startups.

The telecommunications sector is a good example of the complexity of competition rules, where there are debates about market definition (whether at national or EU level) and the role of investment pledges in merger decisions. The United Kingdom's recent decision to allow the merger of Vodafone and Three UK after investment commitments were made may indicate a possible change in the EU as well.

Skeptics, however, note that the Commission has already supported the creation of large companies in the past, for example through the mergers of Fiat Chrysler/PSA and Arcelor/Mittal. In addition, it is emphasized that competition policy alone will not solve Europe's competitiveness problems, but investments in research and development and developed capital markets, in which Europe lags behind the US, are also important. Many European entrepreneurs prefer to seek funding from US venture capitalists and expand in the US market because the rules in Europe are often restrictive and inconsistent.

In conclusion, the article emphasizes the need to find a balance between protecting competition and strengthening the international competitiveness of European companies, with differing opinions on the necessary reforms.