BRUSSELS — A spate of tough antitrust actions by European bureaucrats and the smooth introduction of a regional currency, the euro, have raised the European Union's profile, reminding U.S. firms that they ignore Brussels at their own peril.
That message came through loud and clear during the recent visit by General Electric Co. Chief Executive Jeffrey Immelt, whose firm suffered a humiliating defeat last year when EU regulators squashed the company's proposed $47-billion acquisition of Honeywell International Inc.
In addition to appealing that decision, Immelt has moved his European headquarters from London to Brussels, the seat of the 15-member EU, and appointed Nani Beccalli, an Italian, as the voice for GE in Europe. GE has one-fourth of its worldwide assets in Europe.
"This is my first visit to Brussels since becoming chairman of GE," Immelt said in a speech to European policymakers and business leaders Jan. 28. "You told my predecessor, Jack Welch, to 'go home' last June.... Since then, we have become much smarter and moved our European headquarters to Brussels. Now, if you tell me to go home, I won't need to get on a plane."
Other U.S. firms are reaching the same conclusion about the growing influence of the European Union, particularly in economic matters, said U.S. government officials and business leaders. They pointed to the explosion in lobbying, with estimates that up to 10,000 people here are involved in the business of influencing government, compared with just hundreds a decade ago. London remains the most popular base for U.S. companies, but Brussels boasts 300 European headquarters among its 1,300 American firms.
"What has dawned on U.S. companies more and more is that with the evolution of European institutions, the power has little by little moved from the national member states to Brussels," said Elaine Cruikshanks, chief executive of Hill & Knowlton's Western European operations. "The balance is always changing, but you have to keep your eye on the ball on where the power lies."
Though U.S. executives have started taking notice, the overall understanding about the transition of the EU from a trading organization to a regional economic and political power remains woefully inadequate, said Jeremy Davies, a British expatriate who serves on the advisory board of the European Union Center of California, a nonprofit educational group.
