European antitrust doesn't retreat
If most oligopolies have little to fear from US antitrust regulators (especially under the current administration), events have proven that their EU counterparts are willing to use their muscle. Last month's ruling against Microsoft - with consequences still to be decided - is one of a series of antitrust actions from EU antitrust agency, especially under the regime of Italian economist Mario Monti.
But while Monti has tangles with such US giants as GE (which wanted to acquire Honeywell) and Microsoft, his biggest effect may be in changing the power of the antitrust agency. As the Wall Street Journal ("Monti's Initiatives on Commerce Leave an Enduring Mark", 3/25/2004):
New powers attained by the EU under Mr. Monti include sealing off corporate offices for unspecified periods to prevent destruction of evidence in merger cases and entering the homes, cars, yachts and other personal property of executives suspected of abusing their companies' market power or conspiring to fix prices. EU companies also have a clearer mandate to order dominant companies to sell themselves off in parts.
All this has some critics hopping mad, including US Senate majority leader Bill Frist, whoop called the Microsoft ruling "a preposterous demand by a foreign government."
While Monti is expected to retire next fall, the legacy he has left will mean more trouble to some of the biggest companies in the world, and is surely the biggest brake on even more mergers and acquisitions. With a number of Eastern European nations joining the EU fold, the reach of EU antitrust activities will be even greater. So, too, will be the outrage and pressure from Washington.
