Bloombergtechnology

Trump Antitrust Cop Splits With EU Over Probes of Big Tech

  • DOJ’s Delrahim signals disagreement with EU over Google case
  • Antitrust enforcement shouldn’t punish success, Delrahim says
Photographer: Jasper Juinen/Bloomberg

U.S. President Donald Trump’s top antitrust watchdog split with EU regulators over their enforcement of big U.S. technology firms, saying their approach risked deterring innovative startups.

Google, Apple Inc., Qualcomm Inc. and Facebook Inc. have all suffered run-ins with the European Union’s powerful antitrust arm, part of a wider crackdown in Europe against dominant technology firms that has cost some of them billions of euros.

Makan Delrahim, picked last year by Trump to head the Justice Department’s antitrust division, cited enforcement of digital markets as one of the differences between how the U.S. and the EU conduct antitrust policy. EU law says dominant firms have a special responsibility not to hinder competition, an approach Delrahim criticized.

"Where there is no demonstrable harm to consumers, we are reluctant to impose special duties on digital platforms," Delrahim said during a speech in Brussels Wednesday. The EU stance "might stifle the very innovation that has created dynamic competition for the benefit of consumers," he said.

Delrahim’s remarks come amid multiple EU investigations into Google, which have so far resulted in a penalty of 2.4 billion euros ($2.96 billion), with two other cases in progress. Delrahim’s comments were a veiled critique of that case. He said the U.S. favors "an evidence-based approach." Google has criticized the EU’s enforcement action for failing to prove consumer harm.  

Delrahim refused to comment directly on the EU’s Google probes.

While the EU has aggressively gone after technology companies like Google and Apple, U.S. enforcers have been largely hands-off despite growing calls for the firms to get more antitrust scrutiny because of their dominance in many markets. The U.S. closed a nearly two-year investigation of Google in 2013 without taking any action.

Delrahim’s remarks can be read as a criticism of both the EU’s case against Google and the difference between the EU and U.S. enforcement when it comes to policing anticompetitive conduct, said Michael Carrier, a law professor at Rutgers University who specializes in antitrust.

"Google is the most obvious application of Delrahim’s concern, but the EU has been more aggressive in other cases as well," Carrier said.

In his speech, which EU Competition Commissioner Margrethe Vestager didn’t attend, Delrahim also acknowledged disagreement with the EU over how antitrust laws should be applied to intellectual property. Enforcers might have "strayed too far" in favor of companies that license industry technologies, he said, "very likely at the risk of undermining the incentives for the creation of new and innovative disruptive technologies."

Since taking the antitrust job in September, Delrahim has been outspoken about the way patents are licensed among technology companies. He has criticized industry groups that set technology standards for engaging in "cartel-like" behavior that he says poses a risk to innovation.

While he departed from the usual bland Brussels speeches from officials on the need to smooth international cooperation, name-checking Rolling Stones and U2 songs, Delrahim vowed to "make every effort to work with our counterparts" at the EU.

Vestager was more tight-lipped about her lunch with Delrahim on Tuesday, saying they talked "about antitrust and what we do in general."

"The most important thing for me is the continued commitment for us to work very closely together," she told reporters at a Brussels press conference. "Cooperation in this open and trust based way is what enables us to do our job as efficiently as possible" and "that commitment is as strong as ever on our side."

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