New chief looking to steer a course for competition reform

Date: 25/04/02

Peter Chapman talks to Philip Lowe, the new head of the European Commission's Competition Directorate.

THE man who once crashed the Rolls-Royce reputation of the European Commission's merger task force by ruling on a deal a day late is back - this time to chauffeur-drive Mario Monti's competition directorate along the bumpy road of reform.

Philip Lowe is the first beneficiary of the enforced rotation of Commission mandarins instigated by Neil Kinnock - breaking the German fiefdom at the heart of EU competition policy.

Lowe, currently chief of staff for Kinnock, is quick to rebut claims that his boss pulled strings to get him the job - typified in a letter sent to European Voice this week by a Mr John Smith from London.

Smith (who verified his address details to the newspaper) copied the letter to Kinnock, Monti and Commission head Romano Prodi.

'It is important to reply to Mr Smith,' says Lowe. 'Monti is entirely responsible for this decision. He made it clear from the beginning that he would make the choice himself.

'He is his own man and took an independent view. I am very honoured and flattered to take on this role,' he says, adding that any one of the other seven 'eminent candidates' would have fitted the bill.

He offered some special words of encouragement to the man seen as his main rival for the job, head of the Commission press service Jonathan Faull. 'He is destined for better things,' says Lowe.

The new director-general for competition is British, but keen that nobody should read anything into his nationality after taking over from Germany's Alex Schaub.

Errant UK firms can expect no special treatment in Brussels. Nor can Tony Blair - even though Lowe admits he has been a card-carrying member of the Labour Party.

'I'm not sure if I still am; I may be, there may be a direct debit there somewhere but I don't think it's relevant,' he says, although his views remain 'roughly aligned with the present Labour government'.

Schaub was widely seen as an excellent manager who let his experts do the nitty-gritty job of vetting deals and policing markets.

Lowe sees a similar role for himself - though, as a former head of the merger task force, where he championed greater openness, the new DG will not be shy to put his view across.

'The first thing is to manage the department. That means maximising the potential of everyone in the team.'

A major shake-up in both anti-trust and merger policy is under way.

Both have attracted controversy - but Lowe says the Commission will deliver the anti-trust reforms which have been delayed in the Council of Ministers as governments voiced fears that they could undermine national laws.

A former manager in a manufacturing business, Lowe acknowledges that industry fears the risk of 'double or triple jeopardy' posed by Brussels handing more work to member states.

'No doubt further assurances will have to be given, but we will reach a successful outcome in the autumn,' he predicts.

On mergers, Lowe admits there is unease over the lack of a uniform treatment by the EU and US over the same corporate deals - highlighted by last year's GE/Honeywell case.

He says the day could come when the EU changes the 'dominance' test it uses for examining cases - but now could be too soon.

'It may be at this stage premature. But there is undoubtedly a debate to be had about how you treat the same transactions under different jurisdictions.

'If we are going to have cooperation in the long run then ultimately we should be confronting businesses with the same tests if we believe we are, on both sides of the Atlantic, trying to achieve the same objectives...to maintain and strengthen competitive forces in the economy.'

The best solution, Lowe believes, will be to look over the next five or ten years at how cooperation between the various jurisdictions develops.

'No doubt two or three important cases will give an opportunity for the competition authorities to assess the value of changing.

'After all, if you change your test you change your jurisprudence, so there are things to be weighed up on both sides before we leap into it.'

Lowe says state aid policy also needs a serious PR job to convince a sceptical public of the need to thwart distortions caused by government handouts.

'The overall aims of the policy need to be articulated better,' he says. 'We need to explain it clearly so that state aid is not just something aficionados know about but is something people can take a view on, as they do mergers.'

There will be other thrills and spills on the way - notably the job of nurturing competition policy in the countries set to join the Union and 'carefully monitoring' industries such as EU-based agricultural product makers or the newly privatised companies in the candidate countries.

Lowe, a former director-general for development between his two stints as Kinnock's chief of staff, has a reputation for jumping ship after a job well done, eager for the next challenge.

It would look presumptuous to estimate how long he will be Monti's right-hand man: Lowe merely says he wants to live up to the high standards that the commissioner sets for himself and his staff.

But there is one area of the job that could disappoint. Lowe says he hopes it will be 'amusing'.

While that was a certainty in Kinnock's house of fun, Monti's bone-dry wit is more of an acquired taste.

Interview with Philip Lowe, the new head of the European Commission's Competition Directorate.