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[Analysis] Scott-Morton's failed nomination. Vestager's latest misfire

(B2) The appointment of an American as chief economist was a blow to Europe. And political and legal nonsense. In several titles. His resignation was inevitable.

The announced appointment of the American Fiona Scott-Morton to the post of Chief Economist of DG Competition, approved by the European Commission on July 11, has caused a stir, especially in France, but also more discreetly in other countries. Well Named.

A not very happy appointment

A great CV but three handicaps

Fiona Scott-Morton certainly had a CV as long as her arm, as the European Commission boasts. But above all she had three major handicaps: 1. she was American, 2. she had to obtain a national security clearance, 3. she had worked in a consulting firm and in particular for powerful clients, such as Amazon or Apple, who do not respect not really European rules.

Appointment contested, questionable

This appointment rested on very fragile foundations. Much more fragile than the commissioner wanted to admit. It left a sword of Damocles hanging over the various competition procedures initiated by the European executive: fines, authorization or refusal of mergers, authorization or refusal of state aid, etc. Any actor in these procedures (companies or States) could have contested it. So extraordinary was it in common law and in the practice of recruiting senior European civil servants (point 1). Next, whatever the European Commission says, this “advisory” position is eminently strategic (point 2). Finally, security clearance was required. Point also reduced by the commissioner (point 3).

Inevitable resignation

The resignation made public in the early morning of July 19, just the day after Commissioner Vestager's hearing in the European Parliament, was therefore inevitable.


A hell of a false note for Vestager

For Margrethe Vestager, who is preparing to leave the European Commission, this is a serious disavowal. The Dane is indeed going on unpaid leave in August to campaign for the position of President of the European Investment Bank (EIB). She thus ends her European journey on a big false note. The one who was however promised a brilliant European future - we even saw her chairing the European Commission or, failing that, playing a leading role there, in the shadow of Ursula von der Leyen -, thus completes without fanfare a European assessment which could have been more glorious.

1° A non-European recruited as a senior civil servant. Normal, common, legal practice?

This element has been largely understated by the European Commission. Commissioner Margaret Vestager never ceased to justify, in particular during her hearing with MEPs on 18 July before the ECON (Economy and Finance) committee, that it was the right choice, leaving aside who constitutes the legal reality and the spirit of European competition policy. The spokesperson's service has "invented" similar cases that cannot be compared.

Not enough "good candidates" Europeans?

During her hearing before parliamentarians, in the Economy and Finance Committee (ECON) of the European Parliament, Tuesday (July 18), Margaret Vestager constantly defended this choice to resort to an extra-European... by the lack of candidates. There were only 11 people who responded to the recruitment notice published in March. 4 were retained in the short list. And two candidates selected in the final test: a European and the American specified the European commissioner. It was the latter that was chosen. Based on his skills... It was " the best choice among all the candidates, both in terms of his qualifications and his performance during the recruitment procedure ».

Political, economic and legal nonsense

Recruiting a non-national to such an important leadership position is quite extraordinary. It is contrary to all recruitment rules for the European civil service. Moreover, if the applications are really low, the rule is to relaunch a new call for applications. Which does not seem to be the case here. There was therefore a desire to circumvent European rules. Recruiting a non-European was not an unintended consequence but the objective. A political flaw that could become legal in the hands of a good competition law lawyer...

A big first!

This recruitment from outside the European Union is rather unexpected and a big first. Never to my knowledge has an American held such a prominent position.

The only case in memory is that occupied in the external mission of the CSDP EULEX Kosovo, where an American (a sheriff) held the position of chief investigator. But this presence took place in a very particular context. First of all, common foreign policy is not an exclusive Community competence. Extra-nationals are regularly recruited, either to fill a technical gap (Russian helicopters in Chad), or in a context of necessary political openness. Then, the stabilization of Kosovo was de facto co-managed by the Europeans and the Americans. There was therefore a logic in integrating Americans into this mission (as it is logical for Norwegians to be integrated into the European mission in Palestine, the Oslo agreement obliges).

Other non-nationals have been recruited, but in less important posts. We remember a Norwegian who was in the team of Michel Barnier's office, for example. But this was justified by Norway's integration into the internal market.

This logic is not at all present in competition policy where the European Commission has exclusive competence, can impose fines and prohibitions and where contrary positions between the USA and the EU can interfere.

A singular admission of weakness

To have no economist, no expert who wants to come and take up a (very) well-paid leading position (no less than 20.000 euros per month). This during a three-year CDD (renewable once for two years)! It is rather amazing. Either there is a major weakness in the attractiveness of the European civil service. And that must appeal to the depths of the European spirit. Either there is a big deficit of specialists in Community competition and the economist. Which is just as challenging, given the number of universities and faculties working on these issues.

A political will to recruit outside Europe

In fact, the recruitment of an extra-European seemed partly a foregone conclusion. As one of the spokespersons for the European Commission explained to me, it had been decided to open to as many candidates as possible ", considering " very specific knowledge and academic expertise required for this particular function ". Recruit such a profile “ shows that the Commission seeks above all to base its policies and decisions on the best possible expertise. It is a signal of competence and openness to hear substantive arguments he explains. Here we are far from the criteria of excellence.

2° A simple advisory or leading position?

The post of chief economist is not simply a position of advisor or prospective researcher. It is a post of director, at the head of a team of economic advisers, with an eminently strategic task, contrary to what Commissioner Margrethe Vestager wanted to say.

This position was created in the early 2000s, after a series of judgments by European courts that were negative for the European regulatory authority. The judges had reversed in quick succession two decisions prohibiting mergers, one between Schneider and Legrand on October 22, the other between Tetra Pak and Sidel (read: Tetra-Pak case. The court stirs up trouble at the European Commission). A real thunderclap in the hushed world of competition regulation in Brussels.

Among the reproaches made by the judges, the weakness of the economic analysis of the decisions of the Commission. This had convinced (among others), the commissioner of competition at the time, the Italian Mario Monti to propose in a vast reform of mergers and concentrations.

The creation of the post of Chief Economist is a major element of the reform. " IIt is clear that there is a need to improve the economic capacities of the Directorate-General for Competition said the Italian in a speech delivered in November 2002.

Mario Monti precisely defines this position, which has a very broad, very political vocation and is far from the function of a simple adviser. The role of the chief economist will not be limited to its participation in merger control, but will also extend to the application of competition law in general, including State aid control."

The recruited profile must be up to the task. " This must be an eminent economist, on temporary secondment to the Commission, thereby ensuring that the incumbent of this position is someone with a very good knowledge of industrial economics. He will report directly to the General Manager. »

An appointment which must be accompanied by the recruitment of industrial economists within the DG (which was more populated by lawyers or administrative specialists). A " priority ". Likewise, it displays the desire to make greater use of external economic expertise ". " In particular, I envision that we will more frequently commission our own independent econometric studies. A statement that shows how much the position of chief economist was in the letter and in the spirit of the European Commission reserved for a European.

3° A problem of national security

Contrary to what the commissioner said, the new appointee should have had a security clearance. The notice published for the recruitment testifies to this.

However, this clearance can normally only be provided by the national authority (in this case the USA).

Which posed quite a problem. On the one hand, the USA had to deliver it. On the other hand, the European authorities would have had no control over the nature and reliability of this authorization.

(Nicolas Gros-Verheyde)

Nicolas Gros Verheyde

Chief editor of the B2 site. Graduated in European law from the University of Paris I Pantheon Sorbonne and listener to the 65th session of the IHEDN (Institut des Hautes Etudes de la Défense Nationale. Journalist since 1989, founded B2 - Bruxelles2 in 2008. EU/NATO correspondent in Brussels for Sud-Ouest (previously West-France and France-Soir).