• Policy needs modernising to address today’s challenges
• Digital power concentration must be avoided
• Aims to contribute to EC’s resilience and innovation

European polices must reward those who innovate and invest by “building globally competitive ecosystems around those inventions”, the European Commission’s (EC) competition commissioner Teresa Ribera said in a speech today (17 June).

“Europe is not lacking ideas, talent or ambition. Our challenge is scale,” she said, pointing to bank consolidation as one key area in this respect.

“Cross border mergers of our large European banks . . . is urgently needed,” Ribera said, and added that “Member States should applaud these deals for the overall good”.

When it comes to mergers, Europe cannot simultaneously argue that it needs globally competitive firms and then refuse to examine whether its analytical frameworks “properly reflect” the realities of global competition, technological transformation and investment needs, she said.

Ribera was addressing the European Competition Forum in Brussels in which she noted that competition policy must be adapted to the wider challenges facing Europe.

She said growing concentrations of economic and technological power are reshaping the environment in which EC citizens, businesses and institutions operate.

This is a world in which “access to semiconductors becomes a geopolitical weapon” and global supply chains, “once celebrated as instruments of efficiency, become instruments of leverage”, she said.

Addressing those “realities” is the driving motivation behind the agency’s ongoing efforts to modernise its antitrust, state aid and merger rules, she added.

“We have one objective: to ensure that competition policy remains relevant in a world that is becoming more fragmented, more technological, and more contested.”

For digital markets, that means fighting the increasing concentration of economic, technological and informational power in the same hands, Ribera said.

“Europe cannot remain prosperous if it becomes technologically dependent. It cannot remain secure if critical technologies are controlled elsewhere. And it cannot remain sovereign if it lacks the ability to shape the technological systems that increasingly shape our economies and societies,” she said.

She cited the Digital Markets Act (DMA) and the use of interim measures as examples of how regulation and classical competition enforcement can be used “smartly and effectively”.

Another challenge Ribera highlighted during her speech was resilience. She said competition policy has to adapt to the “difficult lessons” Europe has learned through recent crises.

“Efficiency alone does not guarantee resilience. Dependencies have costs. And those costs become visible precisely when crises occur. This requires us to rethink some assumptions.”

In particular, she said Europe’s policy on state aid has to be consistent with a reality in which other global powers pursue an active industrial strategy with massive investments.

On the topic of innovation, Ribera noted that Europe’s policies must reward those who innovate and invest by “building globally competitive ecosystems around those inventions”.

“Competition policy alone cannot, and will never, solve the innovation challenge, but it can contribute to addressing it in a fair way,” she said.

“This is precisely why we are reviewing our Merger Guidelines. Not because we wish to weaken merger control. But because the economy has changed profoundly since the current framework was designed and we need to get better at our analysis,” she said.

“It is not about giving a blank cheque. It is about making a more holistic analysis.”