2. Market competition as a cornerstone of the EU’s political development

Competition policy in the modern EU has been largely, albeit not entirely, modeled on a set of neoliberal ideas, practices and rules around how markets should be structured and work in regards to economic concentration, governance, and public support.Footnote ⁵ Although important Keynesian and ordoliberal influences have persisted, much of the “hard law” developed as the Single Market deepened relied on more neoliberal principles of market efficiency.Footnote ⁶ Arguably one of the few truly integrated and European policy arenas, competition policy grew into an epistemological and institutional cornerstone for Europe.Footnote ⁷ In so doing, the field of competition law grew over time into a substantial complex of actors and institutions that have provided a foundation for the modern EU.Footnote ⁸ While there were notable exceptions along the way, as with the Airbus Consortium or the Common Agricultural Policy, the overall approach for the contemporary Single Market has emphasized enabling the so-called invisible hand of market competition to work, rather than structuring it visibly.

Yet starting in the second half of the 2010s, this neoliberal approach to competition policy has been the object of rethinking on the part of political actors in the EU. An important moment was the “Franco-German Manifesto for a European industrial policy fit for the 21st Century” presented by French Economy Minister Bruno Le Maire and his German counterpart Peter Altmaier on 19 February 2019 in response to the European Commission’s DG Competition’s rejection of the rail merger of the Alstom-Siemens.Footnote ⁹ The Manifesto proposed a new European industrial strategy and modifications to the longstanding EU regulatory framework. Since then, as Bora and Schramm have documented, “EU competition policy has undergone remarkable changes including merger control, projects of common European interest, and state aid,” with Germany and France decisive in these developments.Footnote ¹⁰

3. The new securitization of competition in the EU

A key component of these changes around competition policy is a new set of framings emerging into political use by European leaders, one that is much more closely aligned with the classic understanding of geopolitical competition from international relations than the orthodox legal understanding.Footnote ¹¹ While great power competition is hardly a novel approach for scholars and practitioners of foreign policy across national settings, the EU has historically been understood as a peace project exclusively focusing on human security and normative power, rather than hard military power and balance of power strategies, making these moves a striking departure in the EU’s policy posture.Footnote ¹²

The linking of market logics and security logics that is occurring now in the EU can be understood in terms of a process of securitization that is bringing Europe into line with more historically common views of economic statecraft.Footnote ¹³ Securitization is a well-established concept in international relations, first highlighted by Ole Wæver and the Copenhagen School of Security Studies in the early 1990s.Footnote ¹⁴ It initially described the process by which state actors transform specific issues into matters of security, framing them in ways that demand exceptional measures, often involving military or other direct state interventions.Footnote ¹⁵ Today, securitization of economic policies, where “policy entrepreneurs have successfully framed economic regulation as essential for national security” is taking place across many different areas of cross-border economic activity through the world, including trade policy, foreign investment screening, and export controls and licensing on sensitive technologies.Footnote ¹⁶ In this reframing, political actors and bureaucrats lay greater claim to securitized issues, often eclipsing the influence of firms and other corporate actors who play a key role in policy formulation under neoliberal logics. Securitization had previously occurred in the EU across policy arenas such as migration, but the single market and EU trade policies were largely left untouched by such explicit politicization.Footnote ¹⁷ While economic competition among sovereign states has historically been very much informed by the notion of competing for global markets to accrue and project power in the international system, the EU’s particular paradigmatic version of competition policy was very different, resting almost exclusively on principles of orthodox market competition and presented as apolitical.Footnote ¹⁸

Today, however, we are seeing a marked shift in the ways in which the economic foundations of the European project are being thought about and politically used by elites. This shift is personified in the trajectory of the former head of DG Competition, Commission Executive Vice President Margrethe Vestager, who from her initial appointment in 2014 had been a visible and effective proponent of using regulatory and enforcement powers to create a level playing field, where free market forces would prevail over corporate power and state aid. Over the last five years of her second term, however, the influence of other views, such as the then internal market Commissioner Thierry Breton’s drive for strategic autonomy, came to challenge the traditional competition norms.Footnote ¹⁹ The Commission of second-term President Ursula von der Leyen has been newly reconfigured in powerful and definitive ways to elevate this new version of market competition, one tightly intertwined with geopolitical goals across the portfolios of the Commissioners.Footnote ²⁰ While Vestager’s bold moves against tech companies continued to demonstrate her power to the end of her term, her overall influence as a free market advocate arguably dimmed.

Beyond the specific example of Vestager’s shift while Competition Commissioner, the Commission developed several policy initiatives which signal a significant break in practices around competition in markets. These policies include broad frameworks such as the European Economic Security Strategy (EESS), which explicitly frames economic flows in a context of geopolitical tensions and rapid technological shifts, and specific responses such as the Anti-Coercion Instrument or Critical Raw Materials Act (CRMA), which are also overtly outward-facing and cast open markets as vulnerable to weaponization.Footnote ²¹ Taken together, these policies constitute a marked shift in the Commission’s orientation to competition, towards a new securitization through their market activism geared to structural global and domestic markets for strategic autonomy and sovereign control.Footnote ²²

These policies are all still new and in progress, and we make no claims about the political or economic effectiveness of the broader policies in play. But we do argue that there is a striking change in the underlying rhetoric about competitiveness in the EU’s single market that goes across a variety of public statements and official reports. Below, we first offer some brief examples of this change in some key, high-profile European Commission reports, before turning to a systematic empirical evaluation that traces out the changes over time in the language and justifications used in the DG Competition Annual Reports.

4. Rhetoric and narratives of competition

5. Securitization in DG competition’s annual reports

Rather than view the EU’s stance towards competition policy as a set of ad hoc responses to increasing geopolitical pressures, our analysis indicates a broad, systematic shift in the construction of competition as a legal and political idea. To better understand the evolution of this framing, we turn to an evaluation of one of the primary policy documents of the EU competition arena: the Directorate-General of Competition’s Annual Reports on competition policy. Or Brook has made a persuasive case for the importance of the DG Competition Annual Reports in constructing the changing and competing meanings of competition over time, or the ‘economic imaginary’ of competition in the EU.Footnote ³¹ We build on and extend her work to consider the role of securitization, in addition to her focus on ordoliberal, Keynesian, and neoliberal notions of competition.

The Annual Reports catalogue the Directorate’s work over the year regarding the development and enforcement of competition policy. They focus the majority of their roughly forty-five pages on specific actions regarding state aid, merger, and antitrust regulatory enforcement. However, their nature as summative reports and orientation to an audience beyond DG Competition makes them important justification tools and requires placing individual cases into a wider logic of action. The reports thus lie at a unique intersection between rhetoric and policy, informing both the rhetorical meta-narrative through which competition is framed at the Directorate and the direct policy the DG carries out. Indeed, the reports themselves are drafted by the DG’s bureaucratic staff, approved by the College of Commissioners, and submitted to the European Parliament for discussion, reflecting their position at the confluence of narrative, politics, and administration.

Since the Annual Reports are released every year by the DG and have followed a roughly similar format over the last decade, they offer a compelling unit of analysis to enable a more systematic study of competition discussions. We apply a language-analysis schema to the reports. Building on Or Brook’s work with the same body of documents, we leverage Critical Discourse Analysis to code the Annual Reports since 2013. This enables a more contextually-sensitive coding, recognizing the use of language in the report as conditioned and constituted by social contexts and as a social action itself, reproducing and shaping the ideologies that it invokes. Our findings can be found in the Figures that follow our overview of our analytic methods.

Securitization is at its heart, a political process of social construction, where strategic actors reframe societal perceptions. Accordingly, it occurs through several interrelated rhetorical moves, each of which we code and trace in our analysis. Most directly, securitization involves the invocation of a crisis or state of emergency to justify the state’s increased role in the market (what we call “Invocation of crisis” in our coding). To initiate such a crisis, political actors must first construct connections between the security concern and the location of policy intervention. As such, when securitization is widespread and systemic, it is characterized by a broad linkage of previously disparate policy areas. Once these issues are linked, the lines between various bureaucratic actors’ domains blur, enabling intervention from previously external policy actors, often with greater capacities for intervention (coded here in our analysis as “Functional spillover”). Even if not explicitly security-related, this functional spillover lays the groundwork for securitization by explicitly morphing the understanding of competition from a contained, exclusively market-based concern to a player in a larger network of issues and related policy spheres.

In the EU’s specific case, securitization has particularly emphasized the geopolitical and geoeconomic contexts inhabited by the Union (what we code as “External orientation”). As evidenced by the Critical Raw Materials Act and the European Economic Security Strategy, referenced previously, the combination of this externally-facing situation of competition and its linkage to security issues is clear in the framing of supply chains as sources of strategic vulnerability. If the Annual Reports follow a similar trend as these landmark policies, we expect that supply chain resilience and control will factor into the DG’s calculations when establishing its aims and motivating its enforcement actions. Other major novel policy initiatives, such as the FDI Screening Regulation, have emphasized similar concerns about financial vulnerabilities. Under a securitized framework, we expect the Annual Reports to similarly frame neoliberal integration of physical and financial supply chains as a potential threat to the EU’s security and independence (coded in our analysis under the label “Strategic autonomy”).

Finally, the EU’s securitization evidenced in the DG Comp reports has placed a marked emphasis on the need for more EU-level capacity-building and action, mirrored in Commissioner’s Vestager’s speech, referenced above, calling for increased EU cooperation in an increasingly challenging geopolitical world. A sense of urgency is created by the invocation of crisis and by the frequent comparisons between the EU and China or the United States. Given the scale of the more united American and Chinese economies and the pace of action in more coordinated environments, the narrative we find around securitization in the EU involves an emphasis on de-fragmentation, further justifying governmental intervention at the EU-level (coded in our analysis as “Fragmentation”). This emphasis on consolidation of power at the center of the EU polity mirrors many traditional conceptions of state building, which highlight the role of security concerns in governmental centralization and increased activism.

To more fully draw out these changes underway across the EU documents, we compare each of these indicators with a set of more neoliberal ones. First, directly contrasting the idea of functional spillover for competition policy, the neoliberal conception of competition situates it in a contained, purely economic space.Footnote ³² Under the neoliberal paradigm, with its emphasis on the efficiency of the market, competition and a competitive market represent an end unto itself, with little need for further justification. In this view, pure competition is framed as an inherent positive, without further modification or correction by the DG. Interventions, when they do occur, are frequently justified as necessary to return to this state of pure competition, rather than to achieve any other policy objectives (“Competition for its own sake”). As discussed by Brook and Pühringer et al, when it is elaborated on, competition is framed as beneficial to the consumer.Footnote ³³ This emphasis on the consumer reflects neoliberalism’s larger occupation with prices, economic efficiency, and mutual gains (“Consumer welfare”). For further information regarding our methods, including how each of the indicators were operationalized, see Appendix A.

At the broadest level, our analysis of the Annual Reports supports our claims about the systemic changes occurring in the EU’s conception of competition. Since 2013, the dominant language in the DG Competition Reports has effectively switched from drawing over 80% from neoliberal terminology to over 80% from a securitized framework instead. Although the pace of change varies by year, Figure 1 highlights how this has been a consistent change, representing the cumulation of almost annual smaller shifts. While clearly a recent phenomenon, this suggests that competition’s securitization in the EU’s official framing was not an abrupt change in the last couple of years, but the product of a more gradual, steady adaptation over the last decade. This lends credence to the larger implications of our story, that this shift is not only a contingency of the current moment, but part of a more founded structural change in the political narrative of economic logics.

Figure 1. Whole report, proportional representation of major indicators

Focusing on the last six years, Figure 2 highlights the key years of change and provides a more granular insight into the dynamics driving the EU’s recent pivot. Functional spillover between policy domains and issue areas was the DG’s leading use of a securitized framing in each Annual Report. We found this unsurprising based on the role of issue linkage in enabling other securitization logics. Notably confirmed by both Figures 1 and 2, 2020 represents an inflection point, after which the DG leveraged the language of securitization more frequently than the language of neoliberalism. As Figure 2 highlights, this shift was initially driven by invocations of crisis, as to be expected with its concurrence with the COVID-19 pandemic. However, Figure 2 also demonstrates that this shift was not driven exclusively by references to the public health emergency, but occurred alongside a surge in functional spillover language and was maintained beyond the months immediately following the crisis.

Figure 2. All indicators for the whole report – Last 6 years.

The other notable inflection point occurred in 2023, when there was a sharp rise in externally-oriented geopolitical language and strategic autonomy concerns. This is the same year that the Commission launched the European Economic Security Strategy and that Commission President von der Leyen first outlined the EU’s new policy of “de-risking” from China. These developments’ reflection in the Annual Reports further suggests the systematic, bureaucracy-wide nature of the securitization phenomenon.

The balance between rhetoric and policy discussion, and the scope under which competition is discussed, varies between sections of the DG’s reports. As such, we disaggregated our analysis by section. Figure 3 focuses on the reports’ introductions and discussions of the DG’s aims and mandates. Accordingly, these are more ideologically-focused sections, which make larger statements on the purpose and ends of competition. Our analysis of these sections further affirms the trends noted in Figures 1 and 2, with 2020 continuing to serve as the transition point from neoliberal-dominated to securitization-dominated framings.

Figure 3. Introduction, Aims, & Mandates – All indicators

The prevalence of consumer welfare as a justification is noteworthy, and fairly unique to this section. This language peaked from 2015 to 2017. During this window, the reports tended to tie consumer welfare to discussions of the aftermath of the financial crisis. This weakly implies that the EU’s responses to previous crises reaffirmed neoliberal values, in a marked distinction from the current reaction.

Turning to a more technical section of the reports, our analysis of state aid discussions in Figure 4 reaffirms the trends discussed in Figure 1, further supporting our findings. To justify the use of state aid, the analysis depicts a dramatic increase in the use of crisis, external geopolitics, strategic autonomy, and the functional spillover effects of competition in markets on political interests of the EU. As state aid had previously been an area long largely curtailed by the EU, these changes are particularly notable as they suggest the new politics at work.

Figure 4. State aid – proportion representation of indicators

A. DG competition’s “progress on the competitiveness of clean energy technologies” annual reports

We complemented our analysis of the Annual Reports with an analysis of a narrower sectoral report released by DG Competition annually since 2020. The EU has pursued a distinctly activist industrial policy in the clean energy technology sector. However, it is not an inherently geopolitical industry, although it has become framed as such more recently. Accordingly, tracing its discussion of competition enabled us to specifically focus our analysis on changes in how competitiveness is understood and measured by DG Comp.

We applied broadly our same coding schema from the Annual Reports, but only to the specific measurement of competitiveness progress in this sector. If leveraging a securitized framework, we expect DG Comp would measure the competitiveness of the clean energy technology sector in comparison to external economies or based on its strategic independence, thus situating the EU’s economy in a geopolitical context. Conversely, the orthodox economic paradigm calls for measuring competitiveness on either exclusively theoretical economic terms or compared to the industry’s past development.

Although these sectoral reports cover a far narrower timeframe than the Annual Reports, they indicate a similarly dramatic shift towards securitization, as both Figures 5 and 6 demonstrate. In 2020, almost 70% of justifications leveraged the economic logics of neoliberalism. Conversely, in 2023, approximately 75% leveraged the logics of securitization. This very striking shift reaffirms our broad argument that competition policy is being reconstructed as securitized.

Figure 5. Introduction & conclusion – proportional representation of all indicators

Figure 6. Sector-wide assessment – proportional representation of all indicators

The framing of the change in these sectoral reports have a different emphasis than the broader Annual reports. In both the introductory overview parts of these reports (Figure 5), and the technical analysis (Figure 6), a shrinking use of consumer-centric metrics to measure competitiveness, and an increased use of external, autonomy-based metrics drove the shift, with functional spillover constituting a negligible portion of the metrics. Based on the temporal difference between these reports, this further supports our argument that more subtle issue linkages laid the groundwork for securitization and while the most recent justification for securitization has predominantly focused more explicitly on external geostrategic concerns.

6. Securitization and legitimation in the EU

Our empirical findings around the securitization of market activism in Europe leaves open a final question. Securitization is often viewed as politically problematic, in that policy challenges when turned into potential security threats can be used to stoke public fear and creating space for unaccountable actions by governments. How then can the securitized competition rhetoric be political legitimate in the EU, an increasingly powerful polity but one without the usual bases for political authority?Footnote ³⁴ While neoliberalism was legitimated by the putative notion that all would benefit from perfectly competitive markets, the explicit use of public powers to actively shape domestic and global markets for securitized, geopolitical ends raises a host of political tensions.

Indeed, there is already much contestation around the new securitization of competition. Key sources of the pushback have appeared in at least two areas. On one hand, resistance is coming from the technocratic career Commission officials who have spent their professional lives within the more orthodox competition regime. For those particularly in what was historically DG Comp and in DG Trade (reconfigured in von der Leyen’s second term), the new EU posture constitutes a challenge given the lack of epistemic authority in this new way of structuring markets for political purposes.Footnote ³⁵ The second major pushback is from political actors in national capitals who are reluctant to see their foreign policy powers curtailed. However, EU leaders have largely agreed to move forward with a common European defence and security policy in the wake of US President Donald Trump’s dismantling of the transatlantic alliance and NATO, a rising China, and expansionist aggression on the part of Putin’s Russia.Footnote ³⁶ But the exact shape of that defence capacity, and the role of markets in it, remains uncertain.

A speech by former High Representative for Foreign Affairs and Security Policy Josef Borrell responding to the Draghi competition report provides a view into the political challenges to be overcome. While fully embracing its direction and goals, Borrell notes that much more specific work needs to be done to fully achieve a geo-economic EU foreign policy, with an upgraded “institutional framework for coordinating the Common Security and Defence Policy and support for the defence industry” alongside a joint debt and fiscal capacity. He notes that the plans for this new EU do not “fall entirely within the scope of ‘industrial policy’ — which is the only way the Treaties currently allow the Commission to play a role in defence matters.”Footnote ³⁷ The new perception that the US may constitute an adversary, not an ally, has provided an impetus for the securitization of markets in the EU beyond Borrell’s assessment. However, the tensions between the goals of the reports around securitization and the actuality of the legal, institutional, and most importantly, political support for those goals are not easily solved.

Competition policy in its more orthodox, legalistic and neoliberal form had a pre-eminent “epistemic authority” over the past decades of the EU’s political development.Footnote ³⁸ The new dynamics set into play with the securitization of competition policy open up unprecedented political opportunities for actors in Europe. Will coalitions of those who support the new rhetoric and policies of securitization of market competition (and the remilitarization of Europe) coalesce to provide the political impetus for broader change? Alongside EU political elites such as von der Leyen, Letta, and Draghi, recent work on the mainstreaming of ‘European sovereignty’ as a legitimating narrative pushed forward by French President Emmanuel Macron suggests a way to orient European political debates towards a geopolitical perspective and provide a political resource for the “rearticulation” of European politics.Footnote ³⁹ But this is far from certain.

If we place this new moment of EU political development where market competition is being securitized in a longer view, it suggests that market and security logics are being brought together in a sustained way in the EU for the first time since the European Coal and Steel Community of 1951. The specter of a full-blown European military-industrial complex, which is to some degree the logical result of the securitization in competition and market activism described above, may mean that security and market logics previously historically separate are coming together for a new era of European political development. While normative concerns remain, the model of innovation, growth and competitiveness that relies on militarization to achieve its goals, and the notion of militarized nationalism as a glue for politics and a fragmented society, have been a path forward for many other polities in the past, particularly the economic power of the US in the post-war era.Footnote ⁴⁰ Despite concerns about bringing security and war into our accounts of the EU’s development, these factors may shape Europe’s politics going forward even as they raise many questions about the democratic legitimation of these processes.Footnote ⁴¹