The EU’s Antitrust Lessons for America

By: Zach Meyers (Project Syndicate)

US corporate giants often criticize the European Commission’s aggressive competition policy, claiming that it protects inefficient European firms. Meanwhile, they applaud America’s laissez-faire antitrust policies, which regard market dominance as a reward for success and have aided the development of today’s US megafirms, especially in the tech sector.

With US President Joe Biden’s administration seeking to boost competition in order to reduce what it views as excessive corporate consolidation, this may be about to change. But the risk is that, rather than tweaking an antitrust regime that has mostly served America well, Biden may go too far in reforming it. US big business may therefore find that, in the long run, the European Union’s competition policy ends up being more predictable and reasonable than America’s.

Consider how the EU and US authorities currently regulate anti-competitive conduct by dominant firms. The European Commission, already tough, is getting even stricter – but there are checks and balances to prevent it from going too far.

For example, the Commission is increasingly concerned about large tech firms leveraging their most-used services to support less-used ones – as, for example, Microsoft does when it uses Windows to promote its search engine, Bing. But, although these practices can give big firms huge advantages over smaller competitors, they are not necessarily anti-competitive. While Bing has a small market share, it is the only meaningful challenger to Google’s near-monopoly in online search. Microsoft’s practices boost competition in this domain and should thus be welcomed, not banned…

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