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Policy Issues
In the News

Rep. Wexler Decries European Tech 'Protectionism'

September 11, 2007

by Andrew Noyes

National Journal’s Technology Daily
PM Antitrust

Reprinted with permission

America’s most innovative industries face a “new form of protectionism” that is sweeping the European Union, which uses antitrust and standards law to “slam the door” on U.S. technology, a key lawmaker said Tuesday.

Florida Democrat Robert Wexler, chairman of the House Foreign Affairs Europe Subcommittee, said at an Association for Competitive Technology event that he is “deeply disturbed” by EU actions against U.S. technology giants like General Electric, Intel and Microsoft. Those and other companies have been under scrutiny in Europe since 2001 and some believe that Google might be next, he said.

The U.S.-EU trade relationship is the largest in the world and “it is critical that EU partners recognize growing American concerns,” Wexler said. The union “should be a natural partner” in convincing China and the rest of Asia to reduce trade barriers, he said.

Wexler is so concerned by EU enforcement that he is planning a hearing “in the next few weeks” to examine the issue further. “I do so with the hope that we can work with EU partners to help make technological advances … fairer for companies on both sides of Atlantic,” he said.

ACT’s Morgan Reed, whose group is backed by Microsoft, said Europe has “taken every big-name [U.S.] innovator to the woodshed.” He asked, “What are Europeans teaching the rest of the world?”

Ronald Cass, chairman of the Center for the Rule of Law, a nonprofit group that analyzes trade rules among other issues, called Europe a “special case,” and on the anniversary of the Sept. 11, 2001, terrorist attacks emphasized that the continent is “among the strongest alliances” held by the United States.

Still, Europe has “used its dominance law to protect competitors — and it’s not just European competitors,” Cass said. American firms that have been unsuccessful in domestic antitrust claims have gone “shopping around the world for a sympathetic forum and they’ve found one in Europe,” he said.

The real threat, Cass said, is not only what European regulators do, “it is what they teach the rest of the world.” If the trend continues, two possible outcomes include having different antitrust requirements in every country or having one version that is stripped down to what the most restrictive nation believes is appropriate, Cass said.

Part of the solution to the problem is having a U.S. trade representative that is “much more proactive” about enforcing trade agreements — not just creating new ones, Information Technology and Innovation Foundation President Robert Atkinson said.

Budget increases for the State Department, U.S. Agency for International Development and FCC training programs for foreign regulators also would help, Atkinson said. “We can’t just sit back and say our system is the best. We’ve got to get out there and proselytize it.”