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EU commissioner: We shouldn't serve tech, tech should serve us

Margrethe Vestager, head of the EU’s Competition Commission, says she takes a tough but fair approach to regulating the world's biggest tech companies.

European Competition Commissioner Margrethe Vestager on stage at Web Summit in Lisbon, Portugal.

European Competition Commissioner Margrethe Vestager on stage at Web Summit in Lisbon, Portugal.

Horacio Villalobos/Getty Images

European Competition Commissioner Margrethe Vestager isn't known for giving Silicon Valley companies an easy ride.

Under her leadership, the Competition Commission last year ruled that Apple owed Ireland $14.5 billion in back taxes. And earlier this year, it came down hard on Google, fining the company $2.7 billion over its online shopping results.

By prioritizing its own shopping comparisons in search results and pushing competitors back to page four, Google denied consumers a choice of shopping services, the commission decided.

"How many of you would like to find your companies on page four of search results?" Vestager asked the audience during a talk Tuesday at Web Summit in Lisbon, Portugal. Unsurprisingly, no one raised a hand.

Vestager offered a simple suggestion to tech companies looking to operate in Europe: show your trustworthiness by abiding by its rules. 

That sounds obvious, but tech companies have struggled to do so, with giants like Google, Microsoft and Apple getting into hot water with the EU. 

It isn't necessarily about how powerful a company is, Vestager said, but whether a company is using its power to engage in anticompetitive practices. 

"We have no objection to Google dominating the market with its search engine. We just don't want it to use that dominance to squeeze out competition," Vestager said. A lack of competition, she said, can "end up closing the door to innovation. Companies like Google have a responsibility because they hold all these powers."

Google didn't reply to a request for comment on Vestager's remarks, but the company did respond in September to the EU's decision by opening up shopping spots to rivals. Vestager will continue to meet with Google and its competitors to judge whether the search giant is doing enough.

Vestager's scrutiny has also landed on Apple, because of the company's tax practices in Ireland. Coming down hard on tax issues isn't just about making an example of companies that benefit from creative accounting, she said. "It's important for Europeans to know that value created in Europe is taxed in Europe."

This weekend's revelations in the Paradise Papers suggested Apple moved money to the Channel Islands off the coast of England to avoid paying more tax in Ireland, but Vestager said the EU was already on the case.

"We have taken an interest in getting to know how Apple is organized now, and we did that before the papers," she said. The commission hasn't spoken to Apple since the publication of the papers, she said, adding that it's too early to decide whether to launch the commission's own investigation on the subject.

Apple rebutted the Paradise Papers report in a lengthy response posted on its site. And CEO Tim Cook dismissed last year's Competition Commission ruling as "political crap."

Vestager said she hasn't stopped to consider how Silicon Valley giants might view her as a result of her and the commission's decisions, but she said she hoped all companies would aim to respect legislation and, in so doing, respect their customers.

Companies have to put fairness and trust at the core of their business, she said, to ensure "society (is)  served by technology and not the other way around."

"It is important for any company to respect the rules of the game," she said.

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