U.S.-Europe Antitrust Partnership Deteriorates: A Shift from Elephants to Elbows in Regulatory Relations
Frayed Ties:
Once simpatico, the US and European antitrust enforcers are now locked in a war of words, as the Trump-era team takes a hardline approach against the EU. These days, the main transatlantic exchanges seem to be barbs, with US officials criticizing their European counterparts for stifling enterprise and burdening businesses.
At a recent gathering designed to encourage collaboration between regulators, FTC Chair Andrew Ferguson launched a scathing attack on "Brussels bureaucrats," insinuating that excessive regulations are hindering US competitiveness.
This dramatic shift represents a break in a transpacific partnership that had strengthened in the digital age, peaking during the Biden administration. The rapprochement of Jonathan Kanter at the Department of Justice and Lina Khan at the FTC had raised hopes for a cooperative approach to checking the power of tech conglomerates.
However, the question remains whether this tilt in tone will have concrete consequences, potentially hampering efforts to curb the power of these tech behemoths that span multiple jurisdictions. While antagonistic talk between regulators may have once unnerved dealmakers, the resulting policy uncertainty may be equally disquieting.
"If anyone thinks that US/EU tensions will provide any certainty, [they're] kidding themselves," warned a senior US mergers and acquisitions lawyer. This fractured system could create even more problems, the lawyer added.
The antagonism from Washington comes as the UK Competition and Markets Authority (CMA) focuses on safeguarding British interests, further clouding co-operative trustbusting efforts.
"We've moved from a period of global coordination to a time where agencies will have to adopt a more nationalist perspective," said antitrust lawyer Liza Lovdahl Gormsen. Such a shift, she argued, runs the risk of producing protectionist outcomes detrimental to consumers and the global economy.
Ferguson's speech in Edinburgh was not the first time he has criticized Europe, but it was the first time he did so to a room full of European regulators. In a heated exchange after his speech, Ferguson challenged Andreas Mundt, the president of Germany's Bundeskartellamt competition authority, to avoid assuming that everything is going to be bad. Instead, he urged European regulators to maintain a more positive outlook and wait for evidence of harm before intervening.
Mundt later dismissed Ferguson's critique, telling the Financial Times: "We shouldn't give too much weight to policy rhetoric ... in practice, there is more common ground than divergence." A US official close to Ferguson downplayed the disagreement between Ferguson and Mundt.
EU competition chief Teresa Ribera expressed optimism, pointing to the Trump Administration's enforcement actions against Big Tech. But tensions may still surface, particularly around rule-making. While the US is pushing for deregulation, Brussels is attempting to make large tech firms comply with specific rules to stimulate competition.
Significant shifts in leadership and regulatory priorities have marked the transatlantic partnership. The US authorities under the Trump Administration are embracing tough enforcement against Big Tech, launching lawsuits against tech giants such as Google, Meta, Apple, and Amazon for a range of alleged antitrust violations.
In Europe, the EC is reviewing its merger guidelines to align competition policy with industrial and innovation objectives. This focus on strategic sectors like defense and telecoms is intended to bolster European competitiveness. Regardless of the unfolding policy changes, the bitter rhetoric seems to have already left a mark.
According to a senior European official in Edinburgh, they were taken aback by Ferguson's critical tone, especially at an event designed to foster collaboration between global agencies. "He comes to Europe and criticizes Europe and then leaves," the official lamented. "I would never do that."
- The transatlantic partnership, once solidified in the digital age, appears to be fractured as US and European antitrust enforcers engage in a heated verbal exchange.
- At a gathering aimed at encouraging regulatory collaboration, FTC Chair Andrew Ferguson criticized the "Brussels bureaucrats," suggesting excessive regulations are hindering US competitiveness.
- This shift in tone could hamper efforts to check the power of tech conglomerates that span multiple jurisdictions, raising concerns about potential protectionist outcomes detrimental to both consumers and the global economy.
- A senior US mergers and acquisitions lawyer warned that the US/EU tensions will not provide any certainty, potentially creating more problems.
- In the midst of this antagonism, the UK Competition and Markets Authority (CMA) is focusing on safeguarding British interests, further clouding cooperative trustbusting efforts.
- Liza Lovdahl Gormsen, an antitrust lawyer, argued that the shift towards a nationalist perspective runs the risk of diluting camaraderie among global agencies and fostering protectionist policies.
- In response to Ferguson's sharp critique, EU competition chief Teresa Ribera expressed optimism, but tensions may still surface, particularly around rule-making, as the US pushes for deregulation while Brussels attempts to make large tech firms comply with specific rules to stimulate competition.
