Margrethe Vestager, executive vice president of the European Commission in charge of EU competition affairs, expressed her support for the new U.S. administration’s proposal to form a coalition of democratic states in the technology sector in an interview with the German newspaper “Handelsblatt” on March 9. She noted that this institutional competition comes first and foremost from China, whose policies are “more ambitious and more globally oriented” than before. Digital technology is a key element of this institutional competition, she said, “because it is at the heart of the functioning of authoritarian regimes.
Vestager, who has been called the EU’s “antitrust czar,” is in charge of EU affairs on artificial intelligence, big data, digitization of the European internal market, cybersecurity, and technological sovereignty. She also announced in the interview that the EC aims to have a European vaccination passport in place by the summer. She said, “This is what we all want. Because it is extremely important for all of us to breathe again, especially since tourism has been hit very hard. The situation is very serious.” She promised that the data in question should be kept as private as possible.
During the interview, the Business Daily reporter asked, “Should Europe take a third path, beyond the surveillance capitalism of the United States and the digital authoritarianism we know from China?” Vestager replied, “In the United States, companies have created the user-as-product business model. But American values are actually very similar to ours.” The reporter asked, “Yet the U.S. government is not regulating technology companies. Does Europe now need to fill that gap?” She said, “We’ve always been more regulated than the United States. We have a stronger welfare state, we have a different tax model, we have stronger regulation in terms of occupational health and safety, product safety, etc. The U.S. is more restrained in that regard.”
The reporter asks, “Is this a matter of tradition or is it a matter of interest? The big tech companies are from the US. Maybe it’s not in the interest of the U.S. to impose rules on them.” Vestager said, “It may make a difference that these companies are from the United States. But the EU and the U.S. have always regulated these kinds of things differently, the EU more by law and the U.S. more on a case-by-case basis. The restrictions on Google and Facebook are more likely to be set in court cases there, whereas we focus on rules. The two approaches can complement each other very well.”
The reporter asked, “After the financial crisis, Europe and the United States managed to work together to tighten regulations on big banks. Is it now possible to imagine something similar, a transatlantic consensus on technology regulation?” Vestager said, “It’s definitely possible because a lot of changes have happened in the U.S. as well. In my previous assignment as EU competition commissioner, I did something about the power of Google. In Washington, they thought I was crazy. Today, the two political camps in the U.S. have different views on technology companies. That allows for a new discussion. For me, it’s important that we don’t waste Time. The European market has to work better, and many European companies can’t wait any longer.”
The journalist asked, “What do you think of the U.S. proposal to form a scientific and technological alliance of democratic countries?” Vestager said, “What the Americans have in mind is consistent with the concept of our Transatlantic Trade and Technology Council. We need a top-level core of a coalition of democratic nations because the systemic competition we’re in is closely linked to the technology race.” The reporter said, “You mean the systemic competition with China.” Vestager added, “Well, I know what we saw from China ten or fifteen years ago is very different from what we see today. China’s policies are much more ambitious, much more global. Technology is of great importance in this competition of regimes because it is at the heart of how authoritarian regimes operate.”
The reporter asked, “Does digitalization promote dictatorship?” Vestager said, “No. Like all technology, it depends on what people use it for. However, today technology is doing things that we could only dream of before. Mao would have jumped for joy: Imagine what he could have done with today’s technology during the Cultural Revolution in China.” The reporter said, “Not an encouraging idea…”
Vestager said, “Establishing power by analogy is daunting. Today, a completely different pace and scope is possible. This is true for better or worse. We humans are behemoths, but we must be mindful of the fact that the pace of development is greatly accelerating.” The reporter asks, “You have made a name for yourself as a ruthless guardian of competition. Do you ever have doubts? Should we encourage industrial champions as the Chinese do? “
Vestager said, “I don’t think deregulating competition will help us. You can’t pick one element of the Chinese system and say, ‘We want to do that, too.’ We should let the Chinese do the Chinese (model). They can do it better than we can. We have a coherent system. Because we don’t have a one-party state deciding everything, we rely on the dynamism of the economy. Competition drives that dynamism. It makes us better, and it’s worked for us in the past, and I don’t see why it shouldn’t work for us in the future.”
The reporter said, “Because when an emerging economy goes all out to support its businesses, the rules of the game change?” Vestager replied, “One of our most important tasks is to ensure that the European market has level playing conditions. That’s why we’re looking at subsidies abroad, and we’ll be able to make a proposal on that next quarter.”
Vestager said, “History is not predetermined, it’s open-ended, and we have to understand that. We have to be very careful about how we use technology to keep democracy and not stumble in the direction of freedom becoming more and more constrained. That’s why we’re emphasizing the ban on upload filters in the new law: the risk of censorship is too great. Now it’s important to keep the balance, because the state plays a central role in our lives and orders things that were previously completely unthinkable. Wear a mask, stay at Home and shut down.”
The journalist talked about, “The EU will invest 150 billion euros in digital projects through the ‘New Crown Recovery Fund’. How do you ensure that this money benefits European tech companies and not the big companies from the U.S. and China?” Vestager said, “Many EU member states will invest mainly in the digitization of training and administration, and of course in infrastructure. What matters to us, however, are the results, the fact that we are making progress. That’s why we didn’t specify which country the companies signed up are from”. The journalist spoke of “the Americans taking a different approach. They recently adopted the ‘Buy America Act’ which gives U.S. companies an advantage in government contracts.”
Vestager said, “It’s also important to have competition as a driver in this space. There are great European companies that are taking on the digital challenge. Our program should be an incentive for them, not a gift.” The reporter asked, “Can we reach digital sovereignty if we rely on huawei, a Chinese network provider, to develop our infrastructure?” She noted, “This question is partly answered by the EU 5G toolkit, a set of standards that we have developed together with member states. It has been applied well, ensuring that we have trusted hardware and software suppliers. After all, digital infrastructure is also very important when it comes to defense policy. It makes many things possible, as we just saw in the virus pandemic. But it also creates many new points of attack.”
The reporter asked, “Do you classify Chinese technology companies as high-risk providers?” Vestager stated, “I wouldn’t generalize, I don’t know the full extent of their situation. But I do see that some member countries are increasingly dependent on equipment suppliers such as Ericsson or Nokia. The situation is different today than it was five years ago.”
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