Commissioner Margrethe Vestager: "We need a global solution on digital taxation"

Margrethe Vestager, European Commissioner for Competition, declared at the May plenary session of the European Economic and Social Committee (EESC) that the Commission has been pushing for digital taxation because we need a global solution; it's unacceptable that some companies pay taxes and others don't. Vestager also suggested that the Commission is considering requiring big companies to share data with their rivals to open up competition.

Commissioner Vestager took part in a debate with the members of the EESC on the topic "Competition for a sustainable society". Luca Jahier, president of the EESC, introduced Margrethe Vestager as the European champion for competition, a crucial issue for economic democracy: If we allow the few to control data, they will control the economy and the democracy, and then our future will be challenged. President Jahier also mentioned other competition related issues, such as taxation or the need to define regulations on mergers that protect both the interest of European consumers and the industrial capacity of the EU.

In her speech, Commissioner Vestager explained that the European Commission has been pushing for a European solution on digital taxation, something that has not been reached so far: If we can have an EU level solution, we will push for a global solution. But today we don't have an EU solution.

She also paid special attention to digital markets and IT companies and recalled that huge amounts of information can give big businesses an edge that smaller rivals can’t match, so they can find it hard to compete, even with a better product, if they don’t have a critical mass of data or users. To remedy to this market distortion, Vestager announced that one thing [the European Commission] may need to do to open up competition is to require companies to give rivals access to their data in order to give competitors a fair chance.

The Commissioner noted that competition should also build citizens' trust in a digital world. As she recalled, some platforms collect data from millions or even billions of users and know more about us than our loved ones, so we need to make sure that we tame the dark sides of this digital world. To do so, the European Commission is considering measures to protect "multi-homing" (which allows consumers to use more than one digital platform) in order to protect innovation. It will also be vigilant against online platforms that are so strong that they can be the market referee by fixing the rules for companies that want to be part it, Margrethe Vestager said.

Margrethe Vestager, who is also one of the candidates for the presidency of the European Commission, representing the Alliance of Liberals and Democrats in Europe (ALDE), defended the importance of competition in building citizens' trust: We all buy in the marketplace every day. We want companies to compete and give us a fair deal. If markets are open, every entrepreneur has a fair shot at success. That helps to build a society that works for everyone.

In her view, competition can even have a positive impact in terms of saving our climate and environment: Competition doesn’t just deliver low prices; it also encourages companies to deliver innovation to protect the environment. If businesses design a promising green technology, our society wants to be able to use it as soon as possible and incumbent companies cannot erect a cartel and delay the introduction of that technology.

However, in her final statement, Commissioner Vestager noted that it is up to consumers to be curious, to dare to try new products and to use their power to define the market with their behaviour. At the end of the day, she said, customers and B2B exchanges define what the market is

Oliver Röpke, president of the EESC's Workers' Group, expressed his concern about the EU's merger rules, which, in his opinion, have so far focused on the market. Competition is key for the Europe we want, with high-quality jobs. But the social costs must always be taken into account, and workers made part of the process, to ensure that mergers and takeovers do not mean job losses, Röpke said.

Arno Metzler, president of the Diversity Europe Group, took the floor to ask Vestager and the European Commission to take into account SMEs and self-employed people in their policies, as the digital transition can threat their working conditions. He also expressed his hope that the decisions and measures taken against US digital giants would also be applied to Chinese companies.

For the EESC's Employers' Group, Udo Hemmerling asked the Commission to give the same support to all sectors, including farmers. Philippe de Buck and Reet Teder proposed more flexible merger regulations, for example, by adjusting the concept of "European champions" to ensure they are big enough and that bigger non-EU companies do not seize them. Finally, Gonçalo Lobo Xavier declared that the EU has to be more than a role model and think about profitability: We don't want protectionism, but we have to be vigilant and not naïve.

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PR 25: Vestager: "We need a global solution on digital taxation"