Of the 28 EU commissioners — the equivalent of U.S. cabinet secretaries — you’d be hard-pressed to find one that’s a household name in Europe, much less the world. They hold dreary, sometimes wordy titles (“first vice president for better regulation, interinstitutional relations, the rule of law, and the charter of fundamental rights,” for example). Most play roles in striking political and economic deals between EU member states, but they have relatively little legal power.
The commissioner for competition is different. The officeholder can launch investigations and serve as an impartial judge on matters of antitrust law, cartels, mergers, and state aid. This involves probing businesses and member states, even those of fellow commissioners. As Andrea Renda, a senior researcher at the Centre for European Policy Studies, put it, the commissioner has “the corner office looking at everyone else.”
Past commissioners have varied widely in temperament and effectiveness. Italian Mario Monti, who served in the early 2000s, was known for his commanding presence and for giving few concessions. When then-CEO of GE Jack Welch first met him and said, “You can call me Jack,” Monti famously replied, “No, grazie. You can call me Signor Monti” — not long before he blocked a major merger between Welch’s company and one of its rivals, Honeywell. Neelie Kroes of the Netherlands took the job next, and she issued Microsoft and Intel billions of dollars in fines for shoving smaller players out of the market. She was criticized, however, for having ties to big business — she sat on a handful of corporate boards — and Kroes recused herself from five cases during her tenure. Then came Spain’s Joaquín Almunia, who by many accounts had an uninspiring run: Not long after opening a case against Google, he met with then-CEO Eric Schmidt at the World Economic Forum in Davos, Switzerland; reportedly, Almunia told Schmidt he would try to settle the inquiry without penalizing the company. “You’re not supposed to see the commissioner of competition sitting down in front of a big steak and a glass of wine with the CEO of a company and saying, ‘How are we going to solve this problem?’” Renda said, referring to public perception. (Almunia declined to comment.)
Vestager was nominated by Denmark to serve on the European Commission in 2014, and Juncker, with whom she had worked through Ecofin, selected her as the antitrust chief. Straight out of the gate, she drew public attention during her confirmation hearing at the European Parliament, where she chomped on pieces of chocolate and snapped iPhone pictures of the press while it took photos of her. She managed to seem simultaneously poised, confident, and charming.
Once in office, where she oversees a staff of about 900 employees, she quickly began selecting investigations. (Svane, Vestager’s biographer, described her decision-making as “unsentimental.”) Cases come to the commissioner through complainants (companies or individuals anywhere in the world who allege a violation of EU competition law); requests from EU states; or public notifications of companies’ transactions. There are close to 400 potential cases each year that pertain to mergers; around 200 concern antitrust issues. Vestager and her advisers deliberate anywhere from five to 15 cases weekly and decide which ones to pursue, based on where the evidence appears strongest. At the conclusion of an investigation, Vestager decides if illegal behavior has occurred and proposes fines or other remedies to the full European Commission. Companies can appeal decisions to the EU Court of Justice.
Vestager has gone after big fish in a big way. On three subsequent Wednesdays in April 2015, she announced investigations into Google, Gazprom, and then EU governments that might be giving state aid to utilities companies; the triple strike earned her a cartoon depiction in the Economist as a Viking who splits corporate logos with an ax. Later came the investigations into Amazon and McDonald’s, and the revival of a case against Apple that had languished under Almunia: To date, the Silicon Valley-based company may have saved some $19 billion in taxes by having its European headquarters in Ireland for more than 30 years. (Apple denies any illegal behavior.)
Vestager told me that tax breaks irk her not only because they violate the law, but because their political optics are abysmal: “These have been challenging times, and every government has had to do things that were quite surprising to some citizens: lowering salaries, cutting subsidies, making personal taxes higher,” she said. In other words, that huge companies get special treatment seems particularly egregious in the Age of Austerity.
Eleanor Fox of New York University Law School elaborated on the principle behind opposition to European state aid. “A neighboring country could say, ‘We want Apple, too; we’ll give it a bigger tax break.’ And that is a race to the bottom,” she explained. “Competition for Apple without the race to the bottom is thought of as a better way to get to and keep a common market.” In this sense, Vestager’s work reflects the business priorities of the Juncker-led commission: securing Europe as a single economic entity — there has even been chatter about a common tax regime — as well as protecting data and privacy from incursions by tech companies. “It’s clear they want to reduce the powers of major platform operators,” Renda said.
As for investigations of Juncker’s home country, Vestager insisted she isn’t concerned about a conflict of interest. “I never talk with him about this,” she said, “and he has also been very specific in public to say I have a completely free hand.” (Juncker was unavailable for comment.)
Vestager’s ostensible focus on facts over politics has earned her plaudits. “Contrasting with her predecessor … Vestager seems to be willing to test cases for what they are,” said Yves Botteman, an antitrust lawyer at the Brussels firm Steptoe and Johnson. Unlike many EU officials, she also doesn’t seem to be angling for easy wins in order to avoid embarrassment and possibly secure a promotion. “She seems to be saying, ‘Let’s try the case,’” Botteman added, “‘and if it’s not good enough, we may need to nix it.’”
Vestager’s approach, if applied consistently, could project a message that the EU isn’t run by a bunch of overpaid bureaucrats lunching in Brussels, accomplishing little, favoring certain governments, and proving impotent against others. Yet as she hopes to garner support close to home, she also faces opponents who watch her like a hawk from thousands of miles away.
When she announced the Belgian case in January, Vestager made sure to emphasize that the companies involved were European. That may be because her biggest pushback since taking office has come from America, where many of her most prominent targets have their roots. Neither CEOs nor some U.S. officials want firms’ hands (or profits) tied by rigorous oversight. In February, U.S. Treasury Secretary Jacob Lew issued a warning, in a letter to Juncker, about the European Commission’s hard line on tax breaks. “While we recognize that state aid is a longstanding concept, pursuing civil investigations — predominantly against U.S. companies — under this new interpretation creates disturbing international tax policy precedents,” he wrote. “We respectfully urge you to reconsider this approach.”
Vestager takes charges of anti-Americanism seriously. “The casework has to be objective and fact-based because, of course, our decisions may have to hold up in court,” she said. But she also pointed out that many complainants who approach her office are American. (Microsoft, for instance, is a complainant in the Google case.) And she rejected the notion that she’s using her post to diminish U.S. economic power or, for that matter, the influence of Europe’s large eastern neighbor. In April 2015, when a reporter asked Vestager what the Google and Gazprom cases had in common, Kjerrumgaard said she replied tersely, “The only two things the cases have in common is that they both start with ‘G.’”
These may be Vestager’s most important investigations — and her trickiest. Europe is in a tense stalemate with Russian President Vladimir Putin over his aggressions in Ukraine and is eager to show its might. “You need to have strong will to go after Gazprom,” said Georgios Petropoulos, a visiting fellow at Bruegel, a Brussels-based think tank. Meanwhile, the European Commission is the first regulator in the world to charge Google with an antitrust violation. In 2013, when it shelved its own investigation into whether the company was rigging its search function to prioritize certain content, the U.S. Federal Trade Commission concluded that Google had acted to improve users’ experience, writing that “any negative impact on actual or potential competitors was incidental to that purpose.”
Vestager views things differently. “What we see is Google using its dominant position in search to promote its own services,” she explained. Vestager asked me to think of how I use Google. “How often do you go to the second page?”Vestager then asked me to think of how I use Google. “How often do you go to the second page?”
This tension points to another big-picture question that Vestager’s time as commissioner will likely address: how EU competition policy interacts with the fast-paced tech economy, and whether it needs updating. Some observers have argued that European law is antiquated because it favors the rights of complainants over ultimate benefits to consumers, even if they’re provided by conglomerates. “We are using the manuals of competition law from the 1970s,” Renda explained, “and pretending we can impose old rules to this new setting.” The EU’s traditional definition of competition — roughly, that all entities in the same sector are rivals — is different than the one currently at work in the global market: Google, Facebook, Twitter, and similar firms, with billions of users worldwide, are jockeying and evolving constantly to win an upper hand; hampering them in the name of fairness to companies of all sizes could put Europe and its citizens at an economic disadvantage. “This is going to weigh heavy on Europe’s ability to be a place you want to do business,” Renda said.
Botteman pointed out that Vestager isn’t the only European force taking on American tech companies. “It’s more EU versus California, than Europe versus the U.S.,” he said. Six European countries — Germany, Belgium, Spain, Italy, France, and the Netherlands — have launched a case against Facebook over privacy concerns. In December, some Amazon employees in Germany went on a four-day strike against poor working conditions. “This is about the new economy,” Botteman said, describing the debate in which the competition commissioner is now a central figure. “The supply or distribution chain is being revolutionized by those companies.”
Vestager, however, is stalwart in her view of economic justice — which she believes will nurture innovation. “If you have an idea for an app or a new service, then you need a market to present it to new customers,” she argued. “If that market has closed because the big ones have decided, ‘Well, we’re here, and we don’t need to be disturbed,’ then it’s very hard for you to decide to innovate. We must make sure markets stay open. Otherwise, you don’t have a fair fighting chance.”
Vestager has almost four years ahead of her in Brussels, where she lives with her husband, a high school math and philosophy teacher, and their two youngest daughters, Rebecca and Ella. (Their eldest, Maria, studies medicine in Denmark.) Vestager betrays little of the distress over work-life balance so many female leaders exude, nor does she seem to have the media-pleasing desire to brag about her own competence in that regard. Rather, she prides herself on raising three self-sufficient women who, “if they miss the bus, know how to find the next one.” She has been spotted attending parent-teacher meetings and grocery shopping at local farmers’ markets. “Family life makes politics make much more sense,” said the woman known to knit in meetings and bake bread for colleagues. “It’s important that you can live the life as everyone else … [and that] you understand what people’s lives are like.”
The goal of Vestager’s principled offensive against corporations, if she were to sum it up, is to show Europeans that the EU is on their side. “The state-aid taxation case can mean more competition and a balanced contribution to a national budget,” she said. “People [can] expect there is someone who will look over the shoulder of the big corporations.”
When I asked Vestager about her professional future, on a phone call after we had met in Brussels, she shrugged off the question by recounting a recent conversation. “A friend of mine was talking about where she will retire, and I said I never spend a second wondering about that,” Vestager said. “I have been willing to take chances because very often the worst thing that can happen to you is hurt feelings. But if you can live with that, then bring it on.”