EU will lose ‘race to the bottom’ on regulation, says competition chief

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Europe must defend its regulatory system more forcefully in order to remain globally competitive, the EU’s competition chief has said in a call to resist pressure from Donald Trump and those lobbying for change at home.

Teresa Ribera, the European Commission’s second-in-command, told the Financial Times that the EU was destined to lose a “race to the bottom” as she championed tough Brussels oversight of Europe’s economy.

Her remarks, as the leading socialist at the EU’s executive arm, come amid a drive by the bloc’s centre-right leadership to appease both Washington and European industrialists with a bonfire of regulations.

“It’s not by chance that it’s the green and digital agenda that are under threat. They are the main drivers of competitiveness,” the commission’s executive vice-president told the Financial Times.

Ribera said the EU needed to stand behind its digital rule book and green standards while deepening the single market to ensure the EU remained competitive in a global economic race.

Turning to the US administration, Ribera said the EU should listen but never bow to demands from Washington to ditch laws on sustainable supply chains, deforestation and social media regulation. The Trump administration has threatened tariffs and penalties against European companies if its requests are not met.

“If we lose our identity, our values, the confidence of our people, we will not be in a position to negotiate anything or to bridge anything,” she said, without naming the US president directly.

Europe must be more effective next year to ensure the “competitiveness, security, values that are very much the blood of this mandate”, Ribera said.

Appointed in December 2024, the former Spanish deputy prime minister positioned herself as a firm defender of the EU’s digital rule book and green regulations even as her boss, Ursula von der Leyen, moved to dismantle some rules she had previously championed.

“There have been moments that we have needed to, where I have needed to, stand up and say: sorry, but we’re not going to undo our regulation just because you don’t like [it],” Ribera said.

In recent months, Ribera and her colleagues in the commission have stepped up enforcement of its digital rules.

Brussels has opened probes into the dominance of Amazon and Microsoft in the cloud sector, launched investigations into the artificial intelligence models of Google and Meta’s WhatsApp, and handed out a €120mn fine to Elon Musk’s X for breaking digital transparency rules.

Ribera said the EU should continue to position itself as a global standard-setter, despite the external pressure.

“As Europeans, we cannot bet on a race to the bottom. We know that through the regulation we create these high standards,” she said. “And there is no single business player in Europe that doesn’t understand or denies the fact that through these high standards they can improve their competitive situation.”

Her comments come as some European socialists grow increasingly alarmed that von der Leyen’s simplification agenda risks going too far, amid a backlash against the EU’s climate agenda and pressure from the US.

While acknowledging the case for streamlining existing rules, Ribera said the bloc needed “to stick to our values” and be consistent.

The commission was holding “ongoing discussions on how we can improve the working methods”, Ribera said, adding that she felt more time was needed to properly assess the bloc’s simplification drive.

Ribera also pushed back against calls from industry to loosen merger control as part of an industrial strategy aimed at building “European champions”, particularly in sectors such as telecoms and banking.

The commission, the bloc’s antitrust enforcer, is at present updating its merger guidelines. The process has become even more politically charged after von der Leyen in September publicly called on Ribera to speed up the work — a statement Ribera said “surprised” her.

She stressed the guidelines would offer companies more clarity and would take future innovation into account more. But the rules would not simply be loosened to give companies a free pass, Ribera said. “If there is someone expecting that, they will be disappointed,” she added.