France, Germany and the Netherlands want more control over mergers –

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France, Germany and the Netherlands want more control over mergers – fr


The logos of Google, Apple, Facebook, Amazon and Microsoft displayed on a mobile phone with an EU flag in the background.
Justin Tallis | AFP via Getty Images
LONDON – The European Union must be more ambitious in its control of Big Techs and small acquisitions that often go under the radar, Germany, France and the Netherlands said on Wednesday.
The 27-member block is currently discussing new legislation that could eventually force Big Tech to change how it works. The law on digital markets, a proposal presented last December, aims to level the playing field in the EU market and could be implemented as early as 2022. In this context, Berlin, Paris and The Hague are calling for a position stricter on mergers.

“We need to strengthen and accelerate merger control, particularly with regard to certain gatekeeper platforms to tackle platform companies’ strategies consisting in systematically buying up nascent companies in order to stifle competition”, the three countries said in a joint statement.

European capitals have long been concerned that some of the world’s biggest tech companies have bought start-ups, including in the EU, in deals that have escaped scrutiny because they did not reach not a certain threshold of turnover.

Whereas high profile purchases, such as Microsoft’s acquisition of Skype in 2011, are making headlines; small transactions often go unnoticed. In 2019, Apple bought an artificial intelligence company in the UK (which is no longer an EU country) for an undisclosed sum, for example.
Speaking to CNBC in 2019, EU competition chief Margrethe Vestager explained how there was a “shopping spree” in Europe.

Marietje Schaake, president of the CyberPeace Institute, told CNBC Street Signs on Thursday that the position of Germany, France and the Netherlands “illustrates (s) that there is growing concern about how existing competition or antitrust rules may apply in a digital world. “

“In particular, mergers and acquisitions came under scrutiny when we saw, for example, Facebook buying WhatsApp and Instagram at excessively high prices and this led to claims that they were essentially buying from competitors. potentials before they’ve even had a chance, ”she added.

In their joint statement on Wednesday, the three countries said the EU should set “clear and legally certain thresholds for acquisitions by goalkeepers of relatively low turnover but high value targets”.

In addition, they called on the EU to adapt “the substantive test to deal effectively with cases of potentially predatory acquisitions”.

The 27 EU member states are currently discussing the digital markets bill presented by the European Commission in December with EU lawmakers. Speaking to CNBC at the ReThink Digital Summit on Tuesday, MEP Stephanie Yon-Courtin said the plan was to have “something ready” by the end of the first half of 2022.

The EU is already a leading regulator on the tech front, but the bloc believes its regulations need updating to better cope with the growing power of some of the world’s biggest tech companies.

Tommaso Valletti, professor of economics at Imperial College Business School, said the EU was ill-prepared to deal with the many mergers that have taken place over the years.

“On mergers, we’re still a little late,” he told CNBC at the same conference, adding that over the past 20 years, Google, Amazon, Facebook, Microsoft and Apple have acquired a thousand companies and none of these transactions have been banned.

“It has been a global problem,” he said.

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