Germany, France take aim at EU anti-trust rules in new industrial strategy

February 19, 2019 by Daphne Rousseau
Paris and Berlin were not happy when the EU blocked the proposed merger of Alstom and Siemens

Germany and France agreed Tuesday on a strategy to create European industrial "champions" and to seek to change EU competition rules that now prevent blockbuster mergers of homegrown companies.

Smarting from the EU's veto of an Alstom-Siemens rail merger, the two European powerhouses proposed that national authorities should in some cases be able to override decisions made by Brussels.

Critics of the EU's decision had argued that it was based on competition regulations that they said were obsolete in the face of growing rivalry from Chinese giants.

"The choice is simple when it comes to industrial policy: unite our forces or allow our industrial base and capacity to gradually disappear," the two economy ministers, France's Bruno Le Maire and Germany's Peter Altmaier, said in a joint statement.

"Competition rules are essential but existing rules need to be revised to be able to adequately take into account industrial policy considerations" that can help European companies compete on the world stage, they said.

Only five European firms count among the world's 40 biggest companies, they said, adding that currently, "there is no regulatory global level playing field. And there won't be one any time soon."

Some countries like China subsidise their companies heavily, or place restrictions on foreign investments in their industrial champions.

EU competition rules should therefore be reformed to take the global landscape into consideration, argued Berlin and Paris.

Existing rules needed to be revised to take the longer view, and in "well-defined cases" it should be considered whether EU decisions could be overridden, they said.


"We will dig deep into this proposal, which, in cases where we believe a merger is particularly appropriate but which is opposed by the European Commission, we will say the countries believe that the merger should go ahead," said Le Maire.

Both sides however took pains to stress that their strategy is open to other EU members that want to sign up.

"It is clear that Germany and France should not decide alone when and how these rules should be changed," said Altmaier.

"We will take the initiative, we will talk with our partners in the EU, with the European Parliament and with the Commission.

"We will see for which ideas there is support and we will try to reach a good conclusion."

Beyond the proposed reforms of , the overall industrial strategy to build European champions includes a push for greater investments in innovations and calls for new mechanisms to better protect homegrown technology

As a first concrete project, both sides will cooperate in the production of electric batteries—an essential component in the race to electrify automobiles.

The ministers named an initial price tag of 1.7 billion euros ($1.9 billion) but gave no further details including the possible location.

If non-European countries want to participate in auctions for public projects, then they must also give Europeans a slice of the cake back home, said Berlin and Paris.

"Reciprocity is perhaps one of the most effective ways to make progress towards a global level playing field," they argued.

Explore further: Siemens, Alstom raise doubts about mega merger

Related Stories

Siemens, Alstom raise doubts about mega merger

January 17, 2019

Confidence that the politically sensitive merger of their rail businesses would be waved through by the European Commission was ebbing at both Siemens and Alstom Thursday.

Siemens boss blasts EU over Alstom rail merger

January 30, 2019

Joe Kaeser, chief executive of German conglomerate Siemens, launched Wednesday a rare broadside against the European Commission, complaining that "backwards-looking technocrats" threatened to block a planned rail merger with ...

Alstom, Siemens offer Brussels merger concessions

December 12, 2018

French and German engineering giants Alstom and Siemens said Wednesday they had offered EU regulators concessions they believed would meet concerns over the planned merger of their railway businesses.

What's next for Siemens and Alstom after merger veto?

February 6, 2019

After Brussels on Wednesday derailed a planned Siemens-Alstom merger that was meant to create a European rail behemoth, here's a look at what's next for the German and French firms in an industry bracing for fierce Chinese ...

Germany hopes to kickstart EU battery-making in 2019

November 13, 2018

German economy minister Peter Altmaier said Tuesday Berlin would provide one billion euros ($1.3 billion) of funding for electric car battery production by 2021, as talks with companies reach an advanced stage.

Recommended for you

A decade on, smartphone-like software finally heads to space

March 20, 2019

Once a traditional satellite is launched into space, its physical hardware and computer software stay mostly immutable for the rest of its existence as it orbits the Earth, even as the technology it serves on the ground continues ...


Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.