Profile: Karel Van Miert; Who's the fairest of them all?

Europe's anti-trust commissioner has been tough with Boeing - and that could be a bad omen for BA, writes Raphael Minder
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The Independent Online
Karel Van Miert, the European Union's leading competition official, is not afraid to pick a fight. Just ask executives from Boeing.

Van Miert put his foot down on Boeing's $15.5bn (pounds 9.2bn) planned purchase of McDonnell Douglas, arguing that the merger would strangle competition in the aerospace industry because it would leave only Europe's Airbus Industrie as a rival supplier of aircraft.

Oblivious to threats of a trade war with the United States and to claims from Boeing's army of lawyers that he is overstepping his judicial powers, Van Miert said he would recommend declaring the purchase illegal next week unless Boeing made major last-minute concessions.

Although a veto from Van Miert will stun Seattle-based Boeing and the American regulators which have already approved the merger, it will come as less of a surprise to those who have been following the 55-year-old Belgian's career since he took over as the European Union's Competition Commissioner in January 1993.

Since he wrote his 1966 university thesis on the European Commission, Van Miert seems to have been destined to lord it from Brussels and defend the role of the EU's executive arm.

That defence has always been as loud as the colourful ties he likes to sport. Working in a bureaucracy prone to double talk has never stopped Van Miert speaking his mind - and those who have ignored his warnings have often done so at their peril.

At ease with journalists as well as with the students he lectures on the role of EU institutions on Friday afternoons at the Flemish university of Brussels, Van Miert doesn't shy away from the public eye. Not a lawyer by training, his bluntness strikes a discordant note with many other EU anti-trust officials and lawyers, who tend to refer back to paragraphs of the 1957 Treaty of Rome rather than provide clear answers.

A sports fanatic, Van Miert spent many years between the goalposts of a local soccer club and escaped last summer from Brussels to follow the Olympic Games in Atlanta. But what he and his team of seven advisers seem to enjoy most is every opportunity to play hardball with some of the world's largest corporations.

Companies as diverse as Anglo American, the South African mining company, and Kesko, Finland's biggest retailer, have faced Van Miert's wrath in the past year for planning acquisitions that could give them a market stranglehold.

Others are still nervously awaiting Van Miert's verdict. Guinness and Grand Metropolitan are hoping to push through a plan to combine their rich selection of drinks and food brands in a $38bn merger, while British Airways still needs the green light for its alliance with American Airlines.

Analysts say that Van Miert's firm stand in the Boeing inquiry is a bad omen for those hoping he might be softer with other pending anti-trust cases.

"If he has been able to remain so tough with Boeing, he will most likely take a tough line in the BA-American case," said Konstantinos Adamantopolous, an aviation lawyer at Hammond Suddards in Brussels.

In his handling of Boeing, Van Miert wasted no time showing his discontent, and the events in the past four months show he was not bluffing.

As early as April, with the investigation only a month old, Van Miert astounded American journalists on a visit to Harvard University when he bluntly declared that he would block the merger in its current form. "We will act," Van Miert said at the time. "There should be no doubt about that."

Whether in English, French, German or Dutch, he has kept emphasising that his anti-trust powers should be used to make the EU's industry more competitive, a far cry from the left-wing notions that guided his rise as a Flemish socialist politician in the 1970s and 1980s.

While many admire his ability to rally support for the European ideal, some feel Van Miert's outspoken style does not sit comfortably with his duties as an enforcer of anti-trust regulation. "You have to ask yourself what motive he had to make these statements [about Boeing] and why not stick to the procedure," said Stephen Kinsella, an anti-trust lawyer at Herbert Smith in Brussels. "This didn't have to be personalised the way it was."

Few believe the EU will be happy to start a full-fledged row with its biggest trading partner over the Boeing purchase, but Van Miert's reputation rests precisely on the fact that he has been able to brush off political pressure in the past.

"Van Miert has been consistent in what he has said about Boeing from the beginning," said Adamantopolous. "He has been able to push the Boeing case through despite the incredible political dimension."

Open criticism from the Clinton administration for his handling of the Boeing merger will not shake a man used to long-running rows with European governments, including France, Germany and, most recently, John Major over the proposed alliance between BA and American Airlines.

Companies have clearly learnt to heed the advice of the outspoken commissioner and rare is the day when one of Europe's top executives does not tread the light green carpet of his office on the eighth floor of the commission's headquarters.

Robert Ayling, the chief executive of BA, has been a regular visitor since the start of the inquiry into the American link-up. Even Boeing, while claiming loud and clear that the McDonnell purchase was not Van Miert's business, sent flocks of senior officials to Brussels to try to assuage his fears, including Phil Condit, the chairman of the company.

That is no mean achievement since many European businessmen do not hide their dislike for the commission's red tape. "As a rule, I am not very fond of interfering Brussels bureaucrats," said Noel Goutard, the chief executive of Valeo, a French maker of car parts.

Van Miert's workload has steadily been increasing as more and more companies find ingenious new ways to control their market and avoid Van Miert's prying eye.

He has been investigating more than 14 possible cartels since the start of 1997. These inquiries often involve complicated dawn raids by Van Miert's inspectors at company offices to look for documents that will provide proof of price-fixing claims.

Politicians for their part do not enjoy interference from Brussels either and Van Miert has repeatedly had to defend the commission's anti-trust powers against German-led suggestions that they should be reviewed. Helmut Kohl, the German Chancellor, even recently proposed exempting state-owned banks from EU competition rules.

Although he spent a decade at the helm of the Flemish Socialist Party Van Miert has tried hard to cut his links with his political past since he took over Europe's anti-trust reins.

Raised on a small Belgian farm as one of nine children, he has repeatedly vowed that he is much more likely to turn his love of gardening and the countryside into a full-time occupation rather than make a political comeback once his mandate at the commission expires at the end of 1999.

But severing his political roots has not always been easy. Belgian police raided his home a few years ago as part of an investigation into one of Belgium's biggest corruption scandals - namely bribes paid by Agusta, an Italian company, to Belgian politicians to secure a helicopter contract in 1988.

While Willy Claes, a fellow Belgian socialist, lost his job as head of the North Atlantic Treaty Organisation because of his links to Agusta, Van Miert has so far emerged unscathed from the investigation.