Brussels is intended to block the merger of Siemens and Alstom railways in Europe into an important competition decision warned by Siemens' executive to reflect the EU's "absolutely naive" way of thinking.
EU competition commissioner Margrethe Vestager is forced to continue with an internal recommendation for vetoing, after the German and French train manufacturers' last ditch concessions failed to address her concerns, according to several people who were really aware of the decision. .
Although there is a potential political debate when the College of 28 Commissioners vote officially on this issue – most likely next week – only one or two Commissioners are opposed to Mr Vestager's recommendation, said senior EU officials involved in the deliberations.
The decision concerns an attack on the efforts of France and Germany to create a "European champion" capable of competing with state-supported foreign competitors. Perhaps it will re-launch the debate on the application of EU competition rules.
The planned merger was one of the most important commission checks since 1989. In 2004, it took over the mandate of EU merger. Businesses supported the support of their governments to set up a group they claimed to avoid increasing competition from China's CRRC, the world's largest train driver.
Bruno Le Maire, French Finance Minister, said this week that "nothing can justify" Brussels, which ended the merger, and on Wednesday, Peter Altmaier, German Economy Minister, said Berlin would "want this merger to happen".
"The international market in this industry is fierce competition … we need big players, we need a European champion who can cope with the competition between US and Chinese companies. So I think this merger makes sense, and that's the right thing, ”said Altmaier.
Siemens CEO Joe Kaeser admitted that the prospects for the transaction approved at the third day's press conference were small, calling for a "back" competition from Brussels.
Ms Vestager informed colleagues that Siemens and Alstom were given the opportunity to sell their assets at signaling and high-speed trains to give her consent, but these recommendations were rejected. Instead, companies chose to add minor changes to their initial offer to address the Commissioner's concerns, EU officials said. At this late stage of the process, "the European Commission has no legal solution" but to block the deal.
The two main advocates of the merger claimed that it was suspected that Siemens and Alstom's decision to abandon such concessions could reflect the other thoughts on the dealings with the companies. But on Wednesday, Mr Kaeser continued his strong efforts to persuade the commission to block what he described as outdated rules that failed to adapt to how the world has changed over the past three decades.
In reply to Mrs Vestager's earlier post in social media, "those who love Europe must be made", Mr Kaeser said in a block competition that was developed in the 1990s.
"It is completely naive to believe that some European countries can really resist competition from China, America, even India, that is impossible," he said. “If we really want to be global players, we need a common European foreign policy. It is very important. ”
Guy Chazan additional reports in Berlin