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Monti Reflects On Evolution Of Antitrust

Edward T. Swaine, a law professor at the University of Pennsylvania's Wharton school, said Monti was able to push through widespread reforms within Europe, often in the face of stiff resistance from entrenched bureaucracies in the E.U.'s member countries.

"He's made great strides in rationalizing the exertion of antitrust authority across Europe," Swaine said.

Mario Monti says E.U. antitrust policy is "now something to be reckoned with," as he steps down as commissioner. (Francois Lenoir -- Reuters)

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For U.S. authorities, perhaps Monti's greatest achievement has been to bridge, though not entirely close, a gap in how much to weigh consumer welfare in evaluating mergers and antitrust enforcement by pushing the E.U. closer to the U.S. view.

Antitrust philosophy in the United States holds that two players combining into a large entity can sometimes result in more efficiency and lower prices. European doctrine traditionally considered fewer players to be a recipe for higher prices over time, and the E.U. continues to be wary of dominant players' ability to use their power to muscle into other markets.

Nonetheless, Monti's views can often be counted on to ignite controversy. Gellhorn said he was puzzled by Monti's assertion that E.U. states are constrained from subsidizing their own companies, arguing that it happens all the time.

And Gellhorn questioned whether export cartels -- employed in industries such as heavy machinery -- have had a significant economic impact anywhere.

Daniel J. Gifford, an antitrust law professor at the University of Minnesota, said his study of E.U. merger cases found that the Europeans "use the American language of consumer welfare, but I think they mean rivalry for the sake of rivalry," preferring to preserve as many competitors as possible.

"There are a number of E.U. decisions where [it] is disapproving mergers that would have resulted in lower prices for consumers," Gifford said.

Monti and his staff, in fact, suffered a series of setbacks in the past two years at the hands of E.U. courts, which have overturned the regulators' decisions to block mergers of European companies.

The criticism he has stirred in the United States is nothing compared with the attacks Monti said he has received in some quarters in Europe, where countries have traditionally supported their own companies at the expense of competition.

He also chided the media for portraying him as an all-powerful decision-maker. In the case of Microsoft, he said, all 15 member countries supported the order that the company offer a version of Windows without its media player, and pay the biggest antitrust fine in history, roughly $600 million. The company is appealing the E.U. ruling.

Monti said that he could have imposed an order that would have applied worldwide, but he chose to defer to the wishes of the U.S. Justice Department that it apply only to Europe.

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