EU antitrust chief-to-be backs high fines
The European Union's designated antitrust commissioner said Tuesday he considered the EU's high fines an effective deterrent to cartels or monopoly abuse.
Joaquin Almunia will take one of the EU executive's most powerful posts if EU lawmakers approve him later this month. He will succeed Neelie Kroes, who levied billions of euros in fines on U.S technology companies Microsoft Corp., Intel Corp. and many others.
The Spanish economist said the level of recent high fines was appropriate.
"We will continue to use fines as a deterrent," he told reporters. "The best recommendation I can give to companies is not to (engage) in anticompetitive practices so that they will not have to care about fines."
EU fines can go as high as 10 percent of a company's annual revenue for each year it breaks the law — often running into hundreds of millions of euros for large companies. Intel received a record fine of euro1.06 billion ($1.5 billion) in May.
Almunia told a European Parliament hearing Tuesday that he would rigorously police competition and state aid rules without bowing to political pressure and that he would continue the EU's emphasis on punishing cartels as this was of "fundamental importance."
He will have the power to block government subsidies to companies if EU officials believe state funding would harm competition by favoring one firm over rivals — which could see him clash with countries like France that often advocate state intervention in business.
"We mustn't give in to any pressure or interests, we mustn't mete out special treatment to anybody," he said.
Fair competition is good for consumers and for companies, he argued, and operating in a competitive, innovative environment would put European businesses in a better position to succeed outside the 27-nation bloc.
Almunia is currently the EU's economy commissioner, a job he has held since 2004.