A number of laws concerning corporate due diligence are currently being drafted in Brussels. The effects of the sustainability agenda will not only be clearly felt in the EU but also in countries exporting to Europe. However, especially smaller producers and suppliers are often not prepared for the requirements. Charlotte Wirth and Leonie Düngefeld provide an overview of EU due diligence legislation and its impact on non-EU countries.
The EU is at an impasse: It has not yet been able to agree on a position on whether to stay in the Energy Charter Treaty, so it is blocking its modernization. The Swedish Council Presidency has now presented a proposal that is supposed to offer a way out of the deadlock. However, according to a European law expert, this proposal holds a lot of legal uncertainties that could discourage investors, as Charlotte Wirth reports.
There is talk of a “bureaucratic nightmare and planning standstill” in the EPP when it comes to implementing existing nature conservation regulations. Today, it is expected to pass a party resolution calling for the repealof the EU Pesticides Regulation and the Nature Restoration Law. EPP leader Manfred Weber also announced that the party family will speak out in favor of a moratorium on “many legislative proposals” of the Commission. Strong opposition followed quickly from Commission Vice-President Frans Timmermans and the Greens in the EU Parliament, as you can read in the News.
Your Sarah Schaefer
Feature
EU care obligations: the consequences for third countries
The goals of the EU sustainability agenda not only mean new requirements for European companies that have to review their supply chains but also new requirements for countries that export to the EU market. These are confronted with new standards and norms and must also reckon with increased controls of production conditions and independent efforts, for example, to prepare due diligence reports.
A whole series of new laws in the area of corporate due diligence is currently emerging in Brussels:
Trilogue negotiations on the Corporate Due Diligence Directive are expected to begin soon; Parliament will vote on its position in early June.
The Deforestation-Free Supply Chains Regulation still needs to be adopted by the Council, the last EU institution, before it enters into force.
The Conflict Minerals Ordinance has been in effect since the beginning of 2021 and will be reviewed this year.
The Ban on Forced Labor Products was presented by the commission in September.
The EU Duty of Care Act, in particular, will have a major impact on third countries: Around 62 percent of African value-added exports, for example, are involved in EU exports. In other words, if Brussels regulates its supply chains, the rules will also apply to a large proportion of African exports to the EU.
‘Potential to add value to global value chains’
However, in many cases, the economies concerned are not prepared for the requirements this entails. Against this background, the German Institute for International and Security Affairs (SWP) sees due diligence legislation as a double-edged sword.
According to an SWP working paper, on the one hand, the law has the potential to enhance global value chains both socially and economically, for example, through better working conditions and household incomes in the global South. The higher requirements imposed by the European law could lead third countries to introduce uniform rules regarding labor norms, production standards, etc., and support local companies in implementing them. At the same time, the EU rules may encourage suppliers and producers to rethink their own processes and rely on clean, safe technologies.
Major players could benefit
On the other hand, according to the paper, there is a risk that stricter due diligence requirements will benefit the big players in particular: Those that have sufficient staff and resources to meet the stricter requirements. Small farmers and smaller producers and intermediaries who cannot cope with the requirements, on the other hand, are threatened with economic decline.
This is what happened in the case of the EU Conflict Minerals Regulation, which is causing more and more gold mining cooperatives in Colombia, for example, to slip into illegality. “These laws are designed for large companies that have labor and resources. But not for small miners and cooperatives,” according to a Colombian gold miner.
Legislation for deforestation-free supply chains has similar consequences for local people. With the regulation, the EU is making it more difficult for smallholders to access the European market, smallholder representative Kambale Malembe from the DR Congo told Table.Media.
EU plans partly compete with national legislation
The regulation for deforestation-free supply chains was recently finally adopted by the Parliament. Before it enters into force, the Council must also formally endorse it. Under the new rules, companies may only sell imports of certain products and raw materials (such as cattle, cocoa, coffee and soy) from certain countries in the EU if suppliers have submitted a due diligence declaration. This must confirm that a product does not come from an area that has been deforested after Dec. 31, 2020, and has not resulted in damage to forests after that date.
The Commission is planning a benchmarking system to rate countries or parts of countries according to their risk of deforestation and forest degradation (high, normal or low risk). Obligations for companies will then depend on the level of this risk.
Companies must also demonstrate that products comply with the legislation of the country of production to ensure that human rights and the rights of indigenous peoples are respected. According to an analysis by Karina Marzano of the Research Institute for Sustainability at Helmholtz-Zentrum Potsdam, the EU regulation also tackles deforestation that is legal locally – and, therefore, potentially competes with national legislation.
Different reactions in third countries
In Brazil, for example, a major exporter of soybeans, private landowners in the Amazon are required by national forestry law to maintain native vegetation on 80 percentof their land, meaning they are allowed to clear 20 percent of their land. The EU regulation, on the other hand, provides for a 100 percent ban on deforestation.
The EU Commission argues that the proposed legislation does not impose a ban on any country or commodity, Marzano says. “Nevertheless, companies are likely to shift their operations away from high-risk producers if there are alternative, low-risk commodity-producing countries.” This, she says, is precisely the outcome the EU is seeking: By promoting sustainable measures by exporting countries, it aims to create a cascading effect that reaches from rural producers to national governments.
Reactions in Brazil were very different, even in the industry: Some associations welcomed the EU initiative, others see it as “protectionism disguised as environmental protection“. The Brazilian Environment Ministry (then under President Jair Bolsonaro) also declared in 2021 that it intended to challenge the EU plans. An NGO alliance, on the other hand, called for the EU law to be sharpened and loopholes closed.
Disengagement risk
Addressing or mitigating risks in their value chain is costly for companies. This creates the risk that companies will withdraw from problematic areas. For those affected, this may mean a worsening rather than an improvement of the situation on the ground.
It remains unclear how authorities in the global South monitor whether their companies comply with European regulations. In this context, the SWP speaks of a “governance overload” in which private certification bodies take over the work of the supervisory authorities. But to change conditions in line with EU requirements, institutional measures are also needed, such as the ratification of ILO labor standards, the adaptation of labor and social standards, and possible changes, of course, in industrial policy.
‘Specifications comply with international conventions’
Markus Löning, who advises German companies on due diligence, sees the governments of third countries as having a responsibility here: Most countries have enshrined fundamental human rights in their constitutions and ratified the relevant international conventions. “Implementing these is their governmental task.”
Meanwhile, the interim review of the French supply chain law describes the risk of trade shifting – especially when it is the middleman, rather than the end user, who holds a position of power. In the case of the aluminum sector, suppliers refused to comply with the French groups’ requirements. They could afford to do so because they have a market monopoly on their product: The bauxite needed to make aluminum. Demand for bauxite is so high that middlemen are focusing on customers with less stringent due diligence requirements, preferring the American, Asian and Middle Eastern markets.
Target countries were left out
“This is also a question of price,” notes Markus Loening and warns against generalizations. The risk of a market shift does exist in individual cases, he says, but that varies from market to market and sector to sector. “You shouldn’t forget that Europe and the US are a huge trading bloc. You don’t just give up on those markets.”
The SGP recommends that due diligence laws forcompanies be accompanied by accompanying measures to provide financial and technical support to producers and intermediaries in the Global South. At the EU level, for example, through the European Fund for Sustainable Development EFSD+.
However, there is one core problem: The Directorate General INTPA, which is responsible for development cooperation, was hardly involved in the drafting of the due diligence law. The EU delegations in the countries impacted by the due diligence law were also hardly consulted. In other words, the countries where the EU law is supposed to ensure better conditions in terms of human rights and the environment have so far been leftout. This also means that the Commission reportedly has little knowledge of what support measures are needed for successful implementation in target countries. Leonie Düngefeld, Charlotte Wirth
Climate & Environment
Sorgfaltspflichten
Supply chains
Energy Charter: withdrawal with uncertain outcome?
The EU has been at an impasse over the Energy Charter Treaty since November. At that time, the modernization of the controversial Investor Protection Treaty was to be decided at a meeting of the ECT states. But the EU states were unable to agree on a position. Since then, the EU has blocked the modernization process.
This is because while countries such as Germany, Slovenia, Spain, the Netherlands, Poland, France and most recently Luxembourg want to withdraw from the outdated treaty, other EU states support its modernization and want to remain in the Charter. As a result, the EU 27 have so farbeen unable toagree on a coordinated EU and Euratom withdrawal from the Charter, as proposed by the Commission since late last year. The European Parliament also came out in favor of withdrawal from the agreement last November.
Sweden proposes withdrawal with exceptions
This week, the Swedish Presidency presented a paper that draws a way out of the current stalemate.
It proposes a three-step approach:
The EU and Euratom are to withdraw from the Energy Charter as a block by Council decision. However, the ECT is a mixed treaty. Not only the EU is a member, but also the individual member states, with the exception of Italy, which already left the Charter in 2015.
For this reason, a wide Council decision should allow member states to support the modernization of the ECT and remain in the Charter if they so wish. Accordingly, they would have the right to approve the ECT reform at the next Energy Charter Conference. So according to this, the EU would not vote on behalf of the EU 27, but each individually.
The vote on the Energy Charter Reform is based on the consensus principle. This means that no ECT member may vote against the modernization. At the same time, Article 36(6) states that a simple majority is required. This is another reason why the vote could not be taken at the Energy Charter Conference in November.
Expert warns of legal uncertainties
The proposal of the Swedish Council Presidency harbors some legal uncertainties, warns Christian Tietje, lecturer in public law, European law and international economic law at the University of Halle, in an interview with Europe.Table. It is an absolutely political compromise.
The fact that the EU and Euratom are withdrawing from the treaty as a block is not a legal problem. However, the sunset clause does not change in this case. In other words, investors can still take legal action against the EU up to 20 years after withdrawal. However, Tietje considers the risk of a lawsuit to be low. Most investors file lawsuits directly against individual member states, not against the EU as a block. Exception: Nord Stream 2 AG against the EU in 2019.
‘Quite a mess’
According to Tietje, the second part of the Swedish proposal is more problematic. Because according to it, some EU stateswouldremain in the Charter while others would leave. This also means that one will have to deal with two regimes. The exit states, which are sometimes bound tothe old Charter, including the sunset clause and intra-EU lawsuits. In the case of the latter, one could indeed argue that these lawsuits are inadmissible according to the ECJ (Achmea 2018, Komstroy 2021 ). However, the arbitration courts do not necessarily adhere to ECJ rulings.
And then, there would be the states that would be part of a reformed charter with an adjusted withdrawal clause and special clause against intra-EU lawsuits. “That’s quite a mess. You then have a very fragmented legal situation within the EU,” Tietje warns. This legal uncertainty is a deterrent to investors.
EU credibility at risk
Christian Tietje warns that the Swedish Presidency’s proposal also calls into question the principle of the EU’s joint approach to third countries “and in an area where the EU’s competences extend very far”. This would also undermine the credibility of the EU.
There is support for the Swedish compromise from diplomatic circles. However, some aspects, such as the question of causality (for example, does the EU leave before modernization is voted on?) remain unresolved.
It is also unclear when the ECT states intend to vote on modernization. Secretary General Guy Lentz recently proposed a written vote. This was opposed by several EU member states. The next Energy Charter Conference will not take place until the end of 2023 in Uzbekistan.
Energy
European policy
EU-Monitoring
May 8, 2023; 5-10 p.m. Plenary Session of the EU Parliament: Methane emission, Consumer protection, Single market Topics: Debate on methane emissions reduction in the energy sector; debate on empowering consumers for the green transition; report on a standardization strategy for the single market.Draft Agenda
May 8, 2023; 7-9 p.m. Meeting of the Committee on the Use of Pegasus and equivalent surveillance spyware (PEGA) Topics: Draft report on the investigation of alleged contraventions and maladministration in the application of Union law in relation to the use of Pegasus and equivalent surveillance spyware; draft motion to investigate the former.Draft Agenda
May 8, 2023; 7-8.30 p.m. Meeting of the Committee on Employment and Social Affairs (EMPL) Topics: Draft motion for a resolution on strengthening social dialogue; draft report on quality traineeships in the EU.Draft Agenda
May 9, 2023; 9 a.m.-10 p.m. Plenary Session of the EU Parliament: Chancellor Scholz, General budget, Istanbul Convention Topics: Debate with German chancellor Olaf Scholz, Debate on the discharge of the 2021 EU general budget; debate on the EU accession to the Istanbul Convention on violence against women.Draft Agenda
May 10, 2023 ECJ ruling: aid granted by Germany to Lufthansa in view of the Covid-19 crisis Topics: By decision of June 25, 2020, the Commission approved Germany’s planned contribution of €6 billion to the recapitalization of Lufthansa. This aid was intended to help Lufthansa overcome the Covid-19 crisis and avoid insolvency. Ryanair and Condor have challenged this decision before the EU’s General Court.Infos
May 10, 2023; 9 a.m.-10 p.m. Plenary Session of the EU Parliament: President of Portugal, Human rights violations, Cohesion policy Topics: Address by Marcelo Rebelo de Sousa (President of Portugal), Debates on cases of breaches of human rights, democracy and the rule of law; short presentation of the report on the role of cohesion policy in addressing multidimensional environmental challenges in the Mediterranean Basin.Draft Agenda
May 11, 2023 ECJ ruling: passenger rights in the event of flight cancellation Topics: The Regional Court of Stuttgart wants to know from the Court of Justice whether the sudden death of a co-pilot shortly before the scheduled departure of the flight constitutes an extraordinary circumstance within the meaning of the Air Passenger Rights Ordinance and can therefore exempt the airline from an obligation to pay compensation.Opinion of Advocate General
May 11, 2023; 9 a.m.-4 p.m. Plenary Session of the EU Parliament: Citizens’ initiative, Biodiversity Topics: Debate on the European citizens’ initiative “Stop Finning – Stop the trade”; debate on oceans, biodiversity and fisheries.Draft Agenda
May 12-13, 2023 Informal meeting of foreign affairs ministers Topics: Discussion of the current foreign and security policy issues.Infos
News
EPP calls for moratorium on all new agricultural laws
Today, Friday, the EPP is expected to adopt a party resolution calling for the complete withdrawal of the EU Pesticides Regulation and the Renaturation Act. In too many regions, the implementation of existing nature protection legislation has led to a “bureaucratic nightmare and planning gridlock”, jeopardizing food security, renewable energy production and vital infrastructure, the resolution says.
EPP leader Manfred Weber also announced that the EPP will advocate a moratorium on “many legislative proposals” of the EU Commission in order to “not pass any new laws for one or two years and let the farmers work for a change”.
Already in mid-March, the CDU/CSU group of the EPP had demanded in a position paper a “fundamental reform of the EU Green Deal” by means of a bureaucracy moratorium for “proposals hostile to location and industry”. Large parts of the EPP and especially the German group are enormously critical of the Commission’s nature conservation package, fearing for the livelihood of farmers and food security in Europe.
Timmermans objects at BMEL
Prompt opposition comes from Green Deal Commissioner Frans Timmermans. “Current forms of food production contribute significantly to the loss of biodiversity,” Timmermans said Thursday at a sustainability conference hosted by the German Federal Ministry of Agriculture (BMEL). Therefore, he said, half of the chemical pesticides must be replaced by alternatives.
This is exactly what the EPP wants to prevent by postponing new agricultural legislation. Timmermans, therefore, indirectly referred to the EPP resolution when he said time is a luxury you don’t have. “You can’t grow food on dead land,” he continued.
The Greens in the EU Parliamentalsoran up a storm against the EPP demands on Thursday. “Behind the resolution is the aim to stop the Green Deal of her party colleague Ursula von der Leyen in crucial points,” commented Anna Deparnay-Grunenberg. When it comes to important measures on nature conservation and the preservation of livelihoods, conservative forces have been putting on the brakes for a long time, she said, “now they’re going for full blockade”.
Jutta Paulus, citing an analysis by the European Environment Agency (EEA), tweeted that pesticides threaten human health and soil fertility. luk
Climate & Environment
Principle of lead candidates: Söder disagrees with Dobrindt
Following criticism of the principle of lead candidates for the 2024 European elections by Alexander Dobrindt, head of the CSU’s parliamentary group in the Bundestag, his party leader Markus Söder has publicly reprimanded him. The top candidate principle is in the EPP statutes, “so that’s what will happen,” Söder said at the EPP’s political meeting in Munich on Thursday.
Dobrindt had always had a different opinion independent of the EPP statute, that would be nothing new. Ursula von der Leyen was born to be the Union’s top candidate, he stressed. “If she wants to be,” Söder added.
In an interview with the “Münchner Merkur,” EPP chairman and CSU deputy leader Manfred Weber expressed his “surprise” at Dobrindt’s remarks and pointed out that the principle of top candidates for the European elections was also a matter of decision for the CSU.
Dobrindt, like CSU leader Söder, is considered an opponent of Weber within the party. In addition to their personal dislike, there are also clear differences between Dobrindt and Weber in terms of content. Dobrindt is one of the Euroskeptics in the CSU, while Weber stands for a decidedly pro-European course.
Irritation over Dobrindt’s statements
Dobrindt’s surprising move has also led to irritation and all kinds of speculation within the CDU/CSU. Behind closed doors, there is speculation as to whether Dobrindt’s statements may have been coordinated with Söder and aimed at CDU leader Friedrich Merz, who has clearly backed Commission President von der Leyen.
Söder, according to speculation, could have an interest in Merzachievinga weak result in the European elections in order to keep open possible chances for his own chancellor candidacy in 2025.
At second glance, however, there is more to suggest that Dobrindt’s move was a solo effort at an inopportune time. For Söder, the Bavarian state elections in the fall have absolute priority. He does not need any new unrest in the CDU/CSUuntil then, or even an open disagreement with Merz. The fact that Dobrindt rowed back in an interview with the FAZ and affirmed that his initiative was not directed against von der Leyen could be an indication that he has also been reprimanded internally by Söder. fa/luk
European policy
Rapporteur wants to remove reusable targets for take-away products
The rapporteur for the Packaging and Packaging Waste Regulation in Parliament, Frédérique Ries (Renew), wants to scrap the reuse targets for the take-away sector. Yesterday, she presented her draft report to the Environment Committee, calling this aspect the “Gordian knot” of the debate. The shadow rapporteurs of the Social Democrats and the Greens sharply criticized this.
The switch from single-use to reusable systems is the most controversial part of the amendment to the Packaging and Packaging Waste Ordinance, Ries said. This is also made clear by massive lobbying campaigns by the industry, which point to the advantages of single-use packaging.
According to shadow rapporteur Delara Burkhardt (S&D), Ries’ draft report goes in the right direction. Unfortunately, however, it “pulls the teeth out of some strong instruments by scrapping the reuse targets for to-go beverages and foods”. Many studies would show the environmental benefits of reusable systems. “In my opinion, all of these goals should remain in the bill.”
Lead management probably remains with ENVI
Grace O’Sullivan, shadow rapporteur for the Greens, also criticized the deletion of these targets yesterday. She also hopes that the committee can still sharpen upon thereduction of unnecessary packaging. Massimiliano Salini (EPP) welcomed the draft. However, he stressed that industry should not panic and constantly invest in new technologies and systems. Instead, he said, it was necessary to build on the best practices of the member states. This, he said, was missing from the draft report.
The EU Commission presented its proposal for the revision of the Packaging Ordinance at the end of November. It specifies concrete quotas for the proportion of reusable packaging and refill systems. These are to apply to distributors in areas such as beverage or transport packaging.
After disagreement in Parliament on the lead between the Environment (ENVI), Industry (ITRE) and Internal Market (IMCO) Committees, it now looks as if ENVI will retain the lead. ITRE and IMCO had demanded exclusive competences for individual articles, ENVI had rejected this. Bernd Lange (SPD), chairman of the Conference of Committee Chairs, argued in a letter to the parliamentary group chairs that the main aim of the regulation was to reduce the environmental impact of packaging. leo
ENVI
ECON wants to have a say in electricity market reform
A tussle over competence has broken out in the EU Parliament over the reform of the electricity market, despite the high time pressure. The Committee on Economic and Monetary Affairs (ECON) insists on shared or exclusive competence for parts of the legislative package, according to correspondence obtained by Table.Media.
So far, only the Internal Market Committee (IMCO) and the Budget Committee (BUDG) have been designated as co-advisory committees. The Economic Committee is now to become an associated committee for the electricity market reform and will be given shared responsibility for Article 9 on futures markets and Article 66a on state intervention in energy prices during a crisis. ECON is also to have a say in several articles concerning financial markets and financial supervision in the amendment to the REMIT transparency regulation.
Economic policymakers probably want CfD to be more binding
This written proposal has been sent by the Chairman of the Conference of Committee Chairs, Bernd Lange (SPD), to the Conference of Presidents of the Parliament. Previously, the ECON had wanted to draw the sole competence for the regulations on state guarantees for SMEs that want to purchase green power directly from renewable plants via long-term power purchase agreements (PPAs).
In addition, the ECON wanted shared jurisdiction also for the full articles on PPAs and contracts for difference (CfD). As a single source from the parliament said, some economic policymakers are seeking a greater binding nature of CfD to make the skimming of excess profits even more obligatory. ber
Electricity market
Energy
GDPR: ECJ rulings on damages and data requests
On Thursday, the European Court of Justice issued two landmark rulings on the interpretation of the General Data Protection Regulation. With this, the highest interpretation authority provides further clarity on the interpretation ofthe GDPR, which has been applicable for almost five years.
The first judgment concerned the right to damages under Article 82 of the GDPR. The Austrian postal service had kept lists of 2.2 million Austrians, which were supposed to list their party political preferences. These were made available to parties for use in return for payment.
Affected parties must prove damage
The judges in Luxembourg stated that the right to damages does not apply to every infringement ofthe GDPR and that data subjects must prove their damages. At the same time, however, the judges emphasized that the GDPR explicitly allows for the enforcement of intellectual property damages. The right to damages is, therefore, independent of other legal remedies, such as a complaint to data protection supervisory authorities.
The judges also ruled that there should be no materiality threshold for damages. Any damage can, therefore, also be the justification for damages. The exact legal formulation is a matter for the member states – since there is no applicable, relevant European law.
However, this must be in accordance with European law. According to the ruling (para. 58), the national regulations must “compensate in full for the actual damage suffered as a result of the infringement of this regulation”. However, this expressly does notmeanpunitive damages, i.e., an amount exceeding the actual damage.
Small claims could inspire legal tech
Pascal Schumacher from the law firm Noerr suspects that the number of claims for damages will increase after the ruling. The professionalized lawsuit industry has been waiting for this. In addition, consumer redress actions would be possible from mid-2023, which would provide for further enforced law enforcement. In the original case of the lawsuit, the non-profit legal-tech association Cobin Claims had reached a settlement with the Austrian postal service for 2,200 affected clients in January for up to €2.7 million, or up to €1,350 per person, according to media reports.
The second ruling was about the right of access and the right to a copy ofthe data of data subjects. Data processors are obliged by the GDPR to provide a copy of the data upon request. Here, the judges ruled that the right of access could alsoincludeexcerpts from databases or entire documents if these were necessary for the exercise of one’s rights. In doing so, the rights of third parties must be preserved. fst
Data protection law
GDPR
Commission wants to tackle pirate radio stations with recommendation
The EU Commission has issued a recommendation on how to tackle illegal live-streaming. “We already have a solid framework for taking action against illegal content online, but it needs to be enforced,” said Digital and Single Market Commissioner Thierry Breton, explaining the approach.
“Today, we call on member states to step up the fight against piracy which demonetizes our live event sectors, for example, by allowing sports event organizers to seek an injunction.” Indeed, this is not the case in all member states so far.
Criticism of the observation period
The Audiovisual Anti-Piracy Alliance (AAPA) is highly dissatisfied with this: The Commission has not only failed to create a legislative act, it has also set a two-and-a-half-year observation period for the implementation of the recommendations. It would have liked to see legislative action.
Pirate MEP Patrick Breyer is also less than enthusiastic: The text also advocates “blocking orders” directed at Internet service providers (ISPs), including “dynamic” blocking orders, without judicial review, Breyer let it be known via press release. This could lead to enormous collateral damage, he said, as it would allow not only individual offers but a large number of them to be blocked equally without control. Breyer calls instead for affordable live streams of sporting events online. fst
GIA: Breko sees network expansion target at risk
The German Broadband Association (Breko) calls for Parliament and the Council to improve the Commission’s draft Gigabit Infrastructure Act (GIA). It advises that the specifics of individual member states’ markets be taken into account in the process. “We share the European Commission’s motivation to increasethespeed of fiber rollout and thus achieve the EU targets for full gigabit connectivity by 2030,” writes Breko in its position paper on the GIA.
It is crucial that regulatory interventions do not hinder the efficient roll-out of fiber infrastructures or create new barriers to investment, he says. In its current form, the GIA will not achieve its goals, the association warns. Instead, fiber rolloutwill be slowed down considerably.
Breko brings together 450 companies that are expanding fiber optics in Germany in competition with Deutsche Telekom. On Thursday, the association, together with the German Association of Energy and Water Industries (BDEW), presented its criticisms of the Commission’s draft legislation in Brussels.
Breko: Draft strengthens former monopolists
“The proposed measures will not meet the Commission’s expectations of accelerating fiber deployment,” the position paper says. Instead, it says, they would “lead to a slowdown in roll-out, strategic duplication of networks and the strengthening of the market power of the operator with significant market power.” The latter would apply in particular to the German market.
Breko made a number of suggested changes:
The chosen legal instrument of regulation is neither appropriate nor balanced and does not consider the different market situations in the member states.
The Physical Infrastructure Access (PIA) rules favored the strategic overbuild of fiber networks. This strengthens the market power of the former monopolists.
The obligation to coordinate civil engineering work not to be extended to privately financed fiber optic projects is positive. However, the fact that projects financed by utilities with municipal participation are also exempt from this obligation should be defined more precisely in the GIA.
The demand for as comprehensive transparency as possible must not jeopardize infrastructure security.
Clear deadlines and the standardization and digital processing of approval procedures were indeed a step in the right direction. However, the deadlines should be significantly shorter overall.
It is also positive that fiber-optic infrastructure should become the in-house standard in new and completely renovated buildings. In addition, there should be corresponding certificates for buildings analogous to energy certificates. vis.
Commission warns Apple against going its own way with charging cables
The EU Commission has warned Apple not to withhold some functions for accessories certified by the company in the upcoming change of charging plug technology for iPhones. Restrictions in the interaction with chargers are inadmissible, EU Industry Commissioner Thierry Breton stressed in a letter obtained by Deutsche Presse-Agentur in Brussels. The EU directive for uniform chargers is to take effect from Dec. 28, 2024.
Apple’s “Lightning” charging plugs have been used in iPhones since 2012. In Europe, it was decided to prescribe the USB-C standard as the uniform charging technology.
Cable certification
Breton’s warning was in response to media reports that Apple considered using an authentication chip to restrict charging or data transfer via accessorieswithout Apple certification. “Devices that do not meet the unified charging requirements will not be allowed on the EU market,” Breton said. He said the commission reminded the company of this at a meeting in mid-March.
By the third quarter of this year, the Brussels-based authority plans to publish a guide to ensure a “uniform interpretation of the legislation.” The chairwoman of the EU Parliament’s Internal Market Committee, Green Party politician Anna Cavazzini, accused Apple of trying to evade EU rules.
Apple does not comment on the reports or Breton’s letter. Apple has a certification program for its “Lightning” cables. The company warns that non-certified cables could damage devices or not function properly. It would be technically possible, for example, to allow fast charging or high-speed data transfer only with certified USB-C cables. dpa
Foreign policy: EU states establish ‘Group of Friends’
Germany and eight other EU states are working to expand majority decision-making in the community on foreign and security policy. The aim of this Group of Friends is to “improve effectiveness and speed of our foreign-policy decision-making,” the German Foreign Office in Berlin said Thursday, along with the other ministries. In addition to Germany, the “Group of Friends” includes Belgium, Finland, France, Italy, Luxembourg, the Netherlands, Slovenia and Spain.
“Against the backdrop of Russia’s war of aggression against Ukraine and the growing international challenges facing the EU, the members of the Group of Friends are convinced that EU foreign policy decision-making procedures need to be adapted in order to strengthen the EU as a global actor,” the statement said.
EU fears becoming unable to act
This is also true with regard to the admission of new members. The states of the Western Balkans have been striving to join the European Union for years. The delay in accession is also attributed to the fact that the EU fears it will become incapable of acting.
The problem has been known for years, but so far, there has been a lack of concrete steps to change this. An expansion of majority decisions could only be realized with unanimous resolutions. The “Group of Friends” now wants to make “pragmatic concrete progress in the decision-making processes.” To this end, a regular stocktaking is planned in coordination with the other member states and the EU institutions. Membership in the group is open to all EU member states. rtr
EU-Außenpolitik
European policy
Felbermayr: Decoupling costs prosperity
Attempting to return the production of industrial goods from China to Germany and friendly countries would be costly and place a heavy burden on the economy in many regions. That is the conclusion of a new study by economist Gabriel Felbermayr of the Austrian Institute of Economic Research. Felbermayr, who headed the Kiel Institute for the World Economy (IfW) until 2021, conducted it on behalf of the Munich-based Foundation for Family Businesses.
The report not only focuses on China but on the decoupling of large economies outside the EU in general. Using a complex model, it attempts to calculate what effects the EU’s renunciation of trade with the countries in question would have on Germany’s real income:
USA: minus 3 percent,
China: minus 1.95 percent,
UK: minus 1.98 percent,
Russia: minus 1,19 percent.
If the EU were to theoretically decouple from all parts of the world (including Japan and Switzerland) simultaneously, the real income of German citizens would drop by a combined 20 percent in the short term. The Foundation for Family Businesses warns policymakers not to treat such ideas lightly.
A complete import halt of products and parts of the “mechanical engineering, equipment” trade category would particularly hit north-western Germany. Included are also microchips.
The study focuses on individual counties. A breakdown of trade with China would hit northwest Germany in particular. The effect is particularly noticeable in the electronics and machinery sector, including microchips; however, the study data combines imports from China and Taiwan. In contrast, southern Germany also has regions that would benefit. Here, on the other hand, a termination of trade with Switzerland would cause significant damage. fin
European policy
Heads
Oliver Stirböck – local ambassador for Europe
Oliver Stirböck is the European policy spokesman for the FDP parliamentary group in the Hessian state parliament.
Oliver Stirböck recalls that he had already predicted at the end of the 1990s that many people would take Europe for granted one day. “We have now reached that time, but we have to be careful that Europe is not taken too much for granted.”
Stirböck, spokesman for Europe for the FDP parliamentary group in the Hessian state parliament, says the same about the United Kingdom: “We have watched the Brexit and the associated loss of an important alliance partner here in Hesse with teary eyes.”
And yet this development is also followed by opportunities for Hesse, especially for Frankfurt as a financial center. Here, Stirböck would like to see more political commitment and better location marketing to promote the settlement of companies in Frankfurt.
Hessian interests in Europe
A business economist by training, he began his political involvement with the Young Liberals, where he was deputy federal chairman for three years. Since 2009, he has been a member of the FDP state executive committee and is the party’s deputy district chairman in the Rhine-Main region.
In 2019, Stirböck was elected to the Hessian state parliament and has since been part of the Europe Committee. For him, the committee’s overriding goal is to ensure that Hessian interests are heard more in Europe, as well as a goal-oriented approach to the effects of European decisions on state policy.
Sending the brightest minds to Brussels
Stirböck attests to a “mentality problem” in Germany with regard toEurope, which has led to the fact that in the past, the strongest candidates were not sent to Europe: “It should no longer be ‘If you have a grandfather, send him to Europe’, but we must send the brightest minds to Brussels“. There is still a lot to learn here from neighboring European countries, he said.
When it comes to energy, he said, it’s also appropriate to look to our neighbors: “We’re pretty much the only country in Europe that thinks it can do without nuclear energy, coal energy and gas. As free democrats, we advocate relying on nuclear energy as well, at least for the time being.”
Europe Committee as an ‘early warning system’
Stirböck sees himself as an “ambassador for Europe: He is interested in making European politics more tangible at the local level. In addition to numerous town twinning arrangements that can strengthen the European idea, Stirböck praises the fact that Europe is thought of in a non-partisan way in Hesse and that the parties pull together.
A good example of this is a proposal to deepen the partnership with North Macedonia. In the course of this, Stirböck was also part of a delegation trip to the country: “A strong yearning for Europe can be felt there and I think we must also offer these countries a serious prospect of accession so that they do not turn away from the West.”
Europe is an important cross-cutting issue, says Stirböck, which is also reflected in the Committees for Economic Affairs, Energy and Housing and for Digital Affairs and Data Protection, of which he is a member. The Europe Committee could represent an “early warning system” to identify at an early stage where there is a need for action and to optimize the dovetailing of state and European policy. Marlene Resch
A number of laws concerning corporate due diligence are currently being drafted in Brussels. The effects of the sustainability agenda will not only be clearly felt in the EU but also in countries exporting to Europe. However, especially smaller producers and suppliers are often not prepared for the requirements. Charlotte Wirth and Leonie Düngefeld provide an overview of EU due diligence legislation and its impact on non-EU countries.
The EU is at an impasse: It has not yet been able to agree on a position on whether to stay in the Energy Charter Treaty, so it is blocking its modernization. The Swedish Council Presidency has now presented a proposal that is supposed to offer a way out of the deadlock. However, according to a European law expert, this proposal holds a lot of legal uncertainties that could discourage investors, as Charlotte Wirth reports.
There is talk of a “bureaucratic nightmare and planning standstill” in the EPP when it comes to implementing existing nature conservation regulations. Today, it is expected to pass a party resolution calling for the repealof the EU Pesticides Regulation and the Nature Restoration Law. EPP leader Manfred Weber also announced that the party family will speak out in favor of a moratorium on “many legislative proposals” of the Commission. Strong opposition followed quickly from Commission Vice-President Frans Timmermans and the Greens in the EU Parliament, as you can read in the News.
Your Sarah Schaefer
Feature
EU care obligations: the consequences for third countries
The goals of the EU sustainability agenda not only mean new requirements for European companies that have to review their supply chains but also new requirements for countries that export to the EU market. These are confronted with new standards and norms and must also reckon with increased controls of production conditions and independent efforts, for example, to prepare due diligence reports.
A whole series of new laws in the area of corporate due diligence is currently emerging in Brussels:
Trilogue negotiations on the Corporate Due Diligence Directive are expected to begin soon; Parliament will vote on its position in early June.
The Deforestation-Free Supply Chains Regulation still needs to be adopted by the Council, the last EU institution, before it enters into force.
The Conflict Minerals Ordinance has been in effect since the beginning of 2021 and will be reviewed this year.
The Ban on Forced Labor Products was presented by the commission in September.
The EU Duty of Care Act, in particular, will have a major impact on third countries: Around 62 percent of African value-added exports, for example, are involved in EU exports. In other words, if Brussels regulates its supply chains, the rules will also apply to a large proportion of African exports to the EU.
‘Potential to add value to global value chains’
However, in many cases, the economies concerned are not prepared for the requirements this entails. Against this background, the German Institute for International and Security Affairs (SWP) sees due diligence legislation as a double-edged sword.
According to an SWP working paper, on the one hand, the law has the potential to enhance global value chains both socially and economically, for example, through better working conditions and household incomes in the global South. The higher requirements imposed by the European law could lead third countries to introduce uniform rules regarding labor norms, production standards, etc., and support local companies in implementing them. At the same time, the EU rules may encourage suppliers and producers to rethink their own processes and rely on clean, safe technologies.
Major players could benefit
On the other hand, according to the paper, there is a risk that stricter due diligence requirements will benefit the big players in particular: Those that have sufficient staff and resources to meet the stricter requirements. Small farmers and smaller producers and intermediaries who cannot cope with the requirements, on the other hand, are threatened with economic decline.
This is what happened in the case of the EU Conflict Minerals Regulation, which is causing more and more gold mining cooperatives in Colombia, for example, to slip into illegality. “These laws are designed for large companies that have labor and resources. But not for small miners and cooperatives,” according to a Colombian gold miner.
Legislation for deforestation-free supply chains has similar consequences for local people. With the regulation, the EU is making it more difficult for smallholders to access the European market, smallholder representative Kambale Malembe from the DR Congo told Table.Media.
EU plans partly compete with national legislation
The regulation for deforestation-free supply chains was recently finally adopted by the Parliament. Before it enters into force, the Council must also formally endorse it. Under the new rules, companies may only sell imports of certain products and raw materials (such as cattle, cocoa, coffee and soy) from certain countries in the EU if suppliers have submitted a due diligence declaration. This must confirm that a product does not come from an area that has been deforested after Dec. 31, 2020, and has not resulted in damage to forests after that date.
The Commission is planning a benchmarking system to rate countries or parts of countries according to their risk of deforestation and forest degradation (high, normal or low risk). Obligations for companies will then depend on the level of this risk.
Companies must also demonstrate that products comply with the legislation of the country of production to ensure that human rights and the rights of indigenous peoples are respected. According to an analysis by Karina Marzano of the Research Institute for Sustainability at Helmholtz-Zentrum Potsdam, the EU regulation also tackles deforestation that is legal locally – and, therefore, potentially competes with national legislation.
Different reactions in third countries
In Brazil, for example, a major exporter of soybeans, private landowners in the Amazon are required by national forestry law to maintain native vegetation on 80 percentof their land, meaning they are allowed to clear 20 percent of their land. The EU regulation, on the other hand, provides for a 100 percent ban on deforestation.
The EU Commission argues that the proposed legislation does not impose a ban on any country or commodity, Marzano says. “Nevertheless, companies are likely to shift their operations away from high-risk producers if there are alternative, low-risk commodity-producing countries.” This, she says, is precisely the outcome the EU is seeking: By promoting sustainable measures by exporting countries, it aims to create a cascading effect that reaches from rural producers to national governments.
Reactions in Brazil were very different, even in the industry: Some associations welcomed the EU initiative, others see it as “protectionism disguised as environmental protection“. The Brazilian Environment Ministry (then under President Jair Bolsonaro) also declared in 2021 that it intended to challenge the EU plans. An NGO alliance, on the other hand, called for the EU law to be sharpened and loopholes closed.
Disengagement risk
Addressing or mitigating risks in their value chain is costly for companies. This creates the risk that companies will withdraw from problematic areas. For those affected, this may mean a worsening rather than an improvement of the situation on the ground.
It remains unclear how authorities in the global South monitor whether their companies comply with European regulations. In this context, the SWP speaks of a “governance overload” in which private certification bodies take over the work of the supervisory authorities. But to change conditions in line with EU requirements, institutional measures are also needed, such as the ratification of ILO labor standards, the adaptation of labor and social standards, and possible changes, of course, in industrial policy.
‘Specifications comply with international conventions’
Markus Löning, who advises German companies on due diligence, sees the governments of third countries as having a responsibility here: Most countries have enshrined fundamental human rights in their constitutions and ratified the relevant international conventions. “Implementing these is their governmental task.”
Meanwhile, the interim review of the French supply chain law describes the risk of trade shifting – especially when it is the middleman, rather than the end user, who holds a position of power. In the case of the aluminum sector, suppliers refused to comply with the French groups’ requirements. They could afford to do so because they have a market monopoly on their product: The bauxite needed to make aluminum. Demand for bauxite is so high that middlemen are focusing on customers with less stringent due diligence requirements, preferring the American, Asian and Middle Eastern markets.
Target countries were left out
“This is also a question of price,” notes Markus Loening and warns against generalizations. The risk of a market shift does exist in individual cases, he says, but that varies from market to market and sector to sector. “You shouldn’t forget that Europe and the US are a huge trading bloc. You don’t just give up on those markets.”
The SGP recommends that due diligence laws forcompanies be accompanied by accompanying measures to provide financial and technical support to producers and intermediaries in the Global South. At the EU level, for example, through the European Fund for Sustainable Development EFSD+.
However, there is one core problem: The Directorate General INTPA, which is responsible for development cooperation, was hardly involved in the drafting of the due diligence law. The EU delegations in the countries impacted by the due diligence law were also hardly consulted. In other words, the countries where the EU law is supposed to ensure better conditions in terms of human rights and the environment have so far been leftout. This also means that the Commission reportedly has little knowledge of what support measures are needed for successful implementation in target countries. Leonie Düngefeld, Charlotte Wirth
Climate & Environment
Sorgfaltspflichten
Supply chains
Energy Charter: withdrawal with uncertain outcome?
The EU has been at an impasse over the Energy Charter Treaty since November. At that time, the modernization of the controversial Investor Protection Treaty was to be decided at a meeting of the ECT states. But the EU states were unable to agree on a position. Since then, the EU has blocked the modernization process.
This is because while countries such as Germany, Slovenia, Spain, the Netherlands, Poland, France and most recently Luxembourg want to withdraw from the outdated treaty, other EU states support its modernization and want to remain in the Charter. As a result, the EU 27 have so farbeen unable toagree on a coordinated EU and Euratom withdrawal from the Charter, as proposed by the Commission since late last year. The European Parliament also came out in favor of withdrawal from the agreement last November.
Sweden proposes withdrawal with exceptions
This week, the Swedish Presidency presented a paper that draws a way out of the current stalemate.
It proposes a three-step approach:
The EU and Euratom are to withdraw from the Energy Charter as a block by Council decision. However, the ECT is a mixed treaty. Not only the EU is a member, but also the individual member states, with the exception of Italy, which already left the Charter in 2015.
For this reason, a wide Council decision should allow member states to support the modernization of the ECT and remain in the Charter if they so wish. Accordingly, they would have the right to approve the ECT reform at the next Energy Charter Conference. So according to this, the EU would not vote on behalf of the EU 27, but each individually.
The vote on the Energy Charter Reform is based on the consensus principle. This means that no ECT member may vote against the modernization. At the same time, Article 36(6) states that a simple majority is required. This is another reason why the vote could not be taken at the Energy Charter Conference in November.
Expert warns of legal uncertainties
The proposal of the Swedish Council Presidency harbors some legal uncertainties, warns Christian Tietje, lecturer in public law, European law and international economic law at the University of Halle, in an interview with Europe.Table. It is an absolutely political compromise.
The fact that the EU and Euratom are withdrawing from the treaty as a block is not a legal problem. However, the sunset clause does not change in this case. In other words, investors can still take legal action against the EU up to 20 years after withdrawal. However, Tietje considers the risk of a lawsuit to be low. Most investors file lawsuits directly against individual member states, not against the EU as a block. Exception: Nord Stream 2 AG against the EU in 2019.
‘Quite a mess’
According to Tietje, the second part of the Swedish proposal is more problematic. Because according to it, some EU stateswouldremain in the Charter while others would leave. This also means that one will have to deal with two regimes. The exit states, which are sometimes bound tothe old Charter, including the sunset clause and intra-EU lawsuits. In the case of the latter, one could indeed argue that these lawsuits are inadmissible according to the ECJ (Achmea 2018, Komstroy 2021 ). However, the arbitration courts do not necessarily adhere to ECJ rulings.
And then, there would be the states that would be part of a reformed charter with an adjusted withdrawal clause and special clause against intra-EU lawsuits. “That’s quite a mess. You then have a very fragmented legal situation within the EU,” Tietje warns. This legal uncertainty is a deterrent to investors.
EU credibility at risk
Christian Tietje warns that the Swedish Presidency’s proposal also calls into question the principle of the EU’s joint approach to third countries “and in an area where the EU’s competences extend very far”. This would also undermine the credibility of the EU.
There is support for the Swedish compromise from diplomatic circles. However, some aspects, such as the question of causality (for example, does the EU leave before modernization is voted on?) remain unresolved.
It is also unclear when the ECT states intend to vote on modernization. Secretary General Guy Lentz recently proposed a written vote. This was opposed by several EU member states. The next Energy Charter Conference will not take place until the end of 2023 in Uzbekistan.
Energy
European policy
EU-Monitoring
May 8, 2023; 5-10 p.m. Plenary Session of the EU Parliament: Methane emission, Consumer protection, Single market Topics: Debate on methane emissions reduction in the energy sector; debate on empowering consumers for the green transition; report on a standardization strategy for the single market.Draft Agenda
May 8, 2023; 7-9 p.m. Meeting of the Committee on the Use of Pegasus and equivalent surveillance spyware (PEGA) Topics: Draft report on the investigation of alleged contraventions and maladministration in the application of Union law in relation to the use of Pegasus and equivalent surveillance spyware; draft motion to investigate the former.Draft Agenda
May 8, 2023; 7-8.30 p.m. Meeting of the Committee on Employment and Social Affairs (EMPL) Topics: Draft motion for a resolution on strengthening social dialogue; draft report on quality traineeships in the EU.Draft Agenda
May 9, 2023; 9 a.m.-10 p.m. Plenary Session of the EU Parliament: Chancellor Scholz, General budget, Istanbul Convention Topics: Debate with German chancellor Olaf Scholz, Debate on the discharge of the 2021 EU general budget; debate on the EU accession to the Istanbul Convention on violence against women.Draft Agenda
May 10, 2023 ECJ ruling: aid granted by Germany to Lufthansa in view of the Covid-19 crisis Topics: By decision of June 25, 2020, the Commission approved Germany’s planned contribution of €6 billion to the recapitalization of Lufthansa. This aid was intended to help Lufthansa overcome the Covid-19 crisis and avoid insolvency. Ryanair and Condor have challenged this decision before the EU’s General Court.Infos
May 10, 2023; 9 a.m.-10 p.m. Plenary Session of the EU Parliament: President of Portugal, Human rights violations, Cohesion policy Topics: Address by Marcelo Rebelo de Sousa (President of Portugal), Debates on cases of breaches of human rights, democracy and the rule of law; short presentation of the report on the role of cohesion policy in addressing multidimensional environmental challenges in the Mediterranean Basin.Draft Agenda
May 11, 2023 ECJ ruling: passenger rights in the event of flight cancellation Topics: The Regional Court of Stuttgart wants to know from the Court of Justice whether the sudden death of a co-pilot shortly before the scheduled departure of the flight constitutes an extraordinary circumstance within the meaning of the Air Passenger Rights Ordinance and can therefore exempt the airline from an obligation to pay compensation.Opinion of Advocate General
May 11, 2023; 9 a.m.-4 p.m. Plenary Session of the EU Parliament: Citizens’ initiative, Biodiversity Topics: Debate on the European citizens’ initiative “Stop Finning – Stop the trade”; debate on oceans, biodiversity and fisheries.Draft Agenda
May 12-13, 2023 Informal meeting of foreign affairs ministers Topics: Discussion of the current foreign and security policy issues.Infos
News
EPP calls for moratorium on all new agricultural laws
Today, Friday, the EPP is expected to adopt a party resolution calling for the complete withdrawal of the EU Pesticides Regulation and the Renaturation Act. In too many regions, the implementation of existing nature protection legislation has led to a “bureaucratic nightmare and planning gridlock”, jeopardizing food security, renewable energy production and vital infrastructure, the resolution says.
EPP leader Manfred Weber also announced that the EPP will advocate a moratorium on “many legislative proposals” of the EU Commission in order to “not pass any new laws for one or two years and let the farmers work for a change”.
Already in mid-March, the CDU/CSU group of the EPP had demanded in a position paper a “fundamental reform of the EU Green Deal” by means of a bureaucracy moratorium for “proposals hostile to location and industry”. Large parts of the EPP and especially the German group are enormously critical of the Commission’s nature conservation package, fearing for the livelihood of farmers and food security in Europe.
Timmermans objects at BMEL
Prompt opposition comes from Green Deal Commissioner Frans Timmermans. “Current forms of food production contribute significantly to the loss of biodiversity,” Timmermans said Thursday at a sustainability conference hosted by the German Federal Ministry of Agriculture (BMEL). Therefore, he said, half of the chemical pesticides must be replaced by alternatives.
This is exactly what the EPP wants to prevent by postponing new agricultural legislation. Timmermans, therefore, indirectly referred to the EPP resolution when he said time is a luxury you don’t have. “You can’t grow food on dead land,” he continued.
The Greens in the EU Parliamentalsoran up a storm against the EPP demands on Thursday. “Behind the resolution is the aim to stop the Green Deal of her party colleague Ursula von der Leyen in crucial points,” commented Anna Deparnay-Grunenberg. When it comes to important measures on nature conservation and the preservation of livelihoods, conservative forces have been putting on the brakes for a long time, she said, “now they’re going for full blockade”.
Jutta Paulus, citing an analysis by the European Environment Agency (EEA), tweeted that pesticides threaten human health and soil fertility. luk
Climate & Environment
Principle of lead candidates: Söder disagrees with Dobrindt
Following criticism of the principle of lead candidates for the 2024 European elections by Alexander Dobrindt, head of the CSU’s parliamentary group in the Bundestag, his party leader Markus Söder has publicly reprimanded him. The top candidate principle is in the EPP statutes, “so that’s what will happen,” Söder said at the EPP’s political meeting in Munich on Thursday.
Dobrindt had always had a different opinion independent of the EPP statute, that would be nothing new. Ursula von der Leyen was born to be the Union’s top candidate, he stressed. “If she wants to be,” Söder added.
In an interview with the “Münchner Merkur,” EPP chairman and CSU deputy leader Manfred Weber expressed his “surprise” at Dobrindt’s remarks and pointed out that the principle of top candidates for the European elections was also a matter of decision for the CSU.
Dobrindt, like CSU leader Söder, is considered an opponent of Weber within the party. In addition to their personal dislike, there are also clear differences between Dobrindt and Weber in terms of content. Dobrindt is one of the Euroskeptics in the CSU, while Weber stands for a decidedly pro-European course.
Irritation over Dobrindt’s statements
Dobrindt’s surprising move has also led to irritation and all kinds of speculation within the CDU/CSU. Behind closed doors, there is speculation as to whether Dobrindt’s statements may have been coordinated with Söder and aimed at CDU leader Friedrich Merz, who has clearly backed Commission President von der Leyen.
Söder, according to speculation, could have an interest in Merzachievinga weak result in the European elections in order to keep open possible chances for his own chancellor candidacy in 2025.
At second glance, however, there is more to suggest that Dobrindt’s move was a solo effort at an inopportune time. For Söder, the Bavarian state elections in the fall have absolute priority. He does not need any new unrest in the CDU/CSUuntil then, or even an open disagreement with Merz. The fact that Dobrindt rowed back in an interview with the FAZ and affirmed that his initiative was not directed against von der Leyen could be an indication that he has also been reprimanded internally by Söder. fa/luk
European policy
Rapporteur wants to remove reusable targets for take-away products
The rapporteur for the Packaging and Packaging Waste Regulation in Parliament, Frédérique Ries (Renew), wants to scrap the reuse targets for the take-away sector. Yesterday, she presented her draft report to the Environment Committee, calling this aspect the “Gordian knot” of the debate. The shadow rapporteurs of the Social Democrats and the Greens sharply criticized this.
The switch from single-use to reusable systems is the most controversial part of the amendment to the Packaging and Packaging Waste Ordinance, Ries said. This is also made clear by massive lobbying campaigns by the industry, which point to the advantages of single-use packaging.
According to shadow rapporteur Delara Burkhardt (S&D), Ries’ draft report goes in the right direction. Unfortunately, however, it “pulls the teeth out of some strong instruments by scrapping the reuse targets for to-go beverages and foods”. Many studies would show the environmental benefits of reusable systems. “In my opinion, all of these goals should remain in the bill.”
Lead management probably remains with ENVI
Grace O’Sullivan, shadow rapporteur for the Greens, also criticized the deletion of these targets yesterday. She also hopes that the committee can still sharpen upon thereduction of unnecessary packaging. Massimiliano Salini (EPP) welcomed the draft. However, he stressed that industry should not panic and constantly invest in new technologies and systems. Instead, he said, it was necessary to build on the best practices of the member states. This, he said, was missing from the draft report.
The EU Commission presented its proposal for the revision of the Packaging Ordinance at the end of November. It specifies concrete quotas for the proportion of reusable packaging and refill systems. These are to apply to distributors in areas such as beverage or transport packaging.
After disagreement in Parliament on the lead between the Environment (ENVI), Industry (ITRE) and Internal Market (IMCO) Committees, it now looks as if ENVI will retain the lead. ITRE and IMCO had demanded exclusive competences for individual articles, ENVI had rejected this. Bernd Lange (SPD), chairman of the Conference of Committee Chairs, argued in a letter to the parliamentary group chairs that the main aim of the regulation was to reduce the environmental impact of packaging. leo
ENVI
ECON wants to have a say in electricity market reform
A tussle over competence has broken out in the EU Parliament over the reform of the electricity market, despite the high time pressure. The Committee on Economic and Monetary Affairs (ECON) insists on shared or exclusive competence for parts of the legislative package, according to correspondence obtained by Table.Media.
So far, only the Internal Market Committee (IMCO) and the Budget Committee (BUDG) have been designated as co-advisory committees. The Economic Committee is now to become an associated committee for the electricity market reform and will be given shared responsibility for Article 9 on futures markets and Article 66a on state intervention in energy prices during a crisis. ECON is also to have a say in several articles concerning financial markets and financial supervision in the amendment to the REMIT transparency regulation.
Economic policymakers probably want CfD to be more binding
This written proposal has been sent by the Chairman of the Conference of Committee Chairs, Bernd Lange (SPD), to the Conference of Presidents of the Parliament. Previously, the ECON had wanted to draw the sole competence for the regulations on state guarantees for SMEs that want to purchase green power directly from renewable plants via long-term power purchase agreements (PPAs).
In addition, the ECON wanted shared jurisdiction also for the full articles on PPAs and contracts for difference (CfD). As a single source from the parliament said, some economic policymakers are seeking a greater binding nature of CfD to make the skimming of excess profits even more obligatory. ber
Electricity market
Energy
GDPR: ECJ rulings on damages and data requests
On Thursday, the European Court of Justice issued two landmark rulings on the interpretation of the General Data Protection Regulation. With this, the highest interpretation authority provides further clarity on the interpretation ofthe GDPR, which has been applicable for almost five years.
The first judgment concerned the right to damages under Article 82 of the GDPR. The Austrian postal service had kept lists of 2.2 million Austrians, which were supposed to list their party political preferences. These were made available to parties for use in return for payment.
Affected parties must prove damage
The judges in Luxembourg stated that the right to damages does not apply to every infringement ofthe GDPR and that data subjects must prove their damages. At the same time, however, the judges emphasized that the GDPR explicitly allows for the enforcement of intellectual property damages. The right to damages is, therefore, independent of other legal remedies, such as a complaint to data protection supervisory authorities.
The judges also ruled that there should be no materiality threshold for damages. Any damage can, therefore, also be the justification for damages. The exact legal formulation is a matter for the member states – since there is no applicable, relevant European law.
However, this must be in accordance with European law. According to the ruling (para. 58), the national regulations must “compensate in full for the actual damage suffered as a result of the infringement of this regulation”. However, this expressly does notmeanpunitive damages, i.e., an amount exceeding the actual damage.
Small claims could inspire legal tech
Pascal Schumacher from the law firm Noerr suspects that the number of claims for damages will increase after the ruling. The professionalized lawsuit industry has been waiting for this. In addition, consumer redress actions would be possible from mid-2023, which would provide for further enforced law enforcement. In the original case of the lawsuit, the non-profit legal-tech association Cobin Claims had reached a settlement with the Austrian postal service for 2,200 affected clients in January for up to €2.7 million, or up to €1,350 per person, according to media reports.
The second ruling was about the right of access and the right to a copy ofthe data of data subjects. Data processors are obliged by the GDPR to provide a copy of the data upon request. Here, the judges ruled that the right of access could alsoincludeexcerpts from databases or entire documents if these were necessary for the exercise of one’s rights. In doing so, the rights of third parties must be preserved. fst
Data protection law
GDPR
Commission wants to tackle pirate radio stations with recommendation
The EU Commission has issued a recommendation on how to tackle illegal live-streaming. “We already have a solid framework for taking action against illegal content online, but it needs to be enforced,” said Digital and Single Market Commissioner Thierry Breton, explaining the approach.
“Today, we call on member states to step up the fight against piracy which demonetizes our live event sectors, for example, by allowing sports event organizers to seek an injunction.” Indeed, this is not the case in all member states so far.
Criticism of the observation period
The Audiovisual Anti-Piracy Alliance (AAPA) is highly dissatisfied with this: The Commission has not only failed to create a legislative act, it has also set a two-and-a-half-year observation period for the implementation of the recommendations. It would have liked to see legislative action.
Pirate MEP Patrick Breyer is also less than enthusiastic: The text also advocates “blocking orders” directed at Internet service providers (ISPs), including “dynamic” blocking orders, without judicial review, Breyer let it be known via press release. This could lead to enormous collateral damage, he said, as it would allow not only individual offers but a large number of them to be blocked equally without control. Breyer calls instead for affordable live streams of sporting events online. fst
GIA: Breko sees network expansion target at risk
The German Broadband Association (Breko) calls for Parliament and the Council to improve the Commission’s draft Gigabit Infrastructure Act (GIA). It advises that the specifics of individual member states’ markets be taken into account in the process. “We share the European Commission’s motivation to increasethespeed of fiber rollout and thus achieve the EU targets for full gigabit connectivity by 2030,” writes Breko in its position paper on the GIA.
It is crucial that regulatory interventions do not hinder the efficient roll-out of fiber infrastructures or create new barriers to investment, he says. In its current form, the GIA will not achieve its goals, the association warns. Instead, fiber rolloutwill be slowed down considerably.
Breko brings together 450 companies that are expanding fiber optics in Germany in competition with Deutsche Telekom. On Thursday, the association, together with the German Association of Energy and Water Industries (BDEW), presented its criticisms of the Commission’s draft legislation in Brussels.
Breko: Draft strengthens former monopolists
“The proposed measures will not meet the Commission’s expectations of accelerating fiber deployment,” the position paper says. Instead, it says, they would “lead to a slowdown in roll-out, strategic duplication of networks and the strengthening of the market power of the operator with significant market power.” The latter would apply in particular to the German market.
Breko made a number of suggested changes:
The chosen legal instrument of regulation is neither appropriate nor balanced and does not consider the different market situations in the member states.
The Physical Infrastructure Access (PIA) rules favored the strategic overbuild of fiber networks. This strengthens the market power of the former monopolists.
The obligation to coordinate civil engineering work not to be extended to privately financed fiber optic projects is positive. However, the fact that projects financed by utilities with municipal participation are also exempt from this obligation should be defined more precisely in the GIA.
The demand for as comprehensive transparency as possible must not jeopardize infrastructure security.
Clear deadlines and the standardization and digital processing of approval procedures were indeed a step in the right direction. However, the deadlines should be significantly shorter overall.
It is also positive that fiber-optic infrastructure should become the in-house standard in new and completely renovated buildings. In addition, there should be corresponding certificates for buildings analogous to energy certificates. vis.
Commission warns Apple against going its own way with charging cables
The EU Commission has warned Apple not to withhold some functions for accessories certified by the company in the upcoming change of charging plug technology for iPhones. Restrictions in the interaction with chargers are inadmissible, EU Industry Commissioner Thierry Breton stressed in a letter obtained by Deutsche Presse-Agentur in Brussels. The EU directive for uniform chargers is to take effect from Dec. 28, 2024.
Apple’s “Lightning” charging plugs have been used in iPhones since 2012. In Europe, it was decided to prescribe the USB-C standard as the uniform charging technology.
Cable certification
Breton’s warning was in response to media reports that Apple considered using an authentication chip to restrict charging or data transfer via accessorieswithout Apple certification. “Devices that do not meet the unified charging requirements will not be allowed on the EU market,” Breton said. He said the commission reminded the company of this at a meeting in mid-March.
By the third quarter of this year, the Brussels-based authority plans to publish a guide to ensure a “uniform interpretation of the legislation.” The chairwoman of the EU Parliament’s Internal Market Committee, Green Party politician Anna Cavazzini, accused Apple of trying to evade EU rules.
Apple does not comment on the reports or Breton’s letter. Apple has a certification program for its “Lightning” cables. The company warns that non-certified cables could damage devices or not function properly. It would be technically possible, for example, to allow fast charging or high-speed data transfer only with certified USB-C cables. dpa
Foreign policy: EU states establish ‘Group of Friends’
Germany and eight other EU states are working to expand majority decision-making in the community on foreign and security policy. The aim of this Group of Friends is to “improve effectiveness and speed of our foreign-policy decision-making,” the German Foreign Office in Berlin said Thursday, along with the other ministries. In addition to Germany, the “Group of Friends” includes Belgium, Finland, France, Italy, Luxembourg, the Netherlands, Slovenia and Spain.
“Against the backdrop of Russia’s war of aggression against Ukraine and the growing international challenges facing the EU, the members of the Group of Friends are convinced that EU foreign policy decision-making procedures need to be adapted in order to strengthen the EU as a global actor,” the statement said.
EU fears becoming unable to act
This is also true with regard to the admission of new members. The states of the Western Balkans have been striving to join the European Union for years. The delay in accession is also attributed to the fact that the EU fears it will become incapable of acting.
The problem has been known for years, but so far, there has been a lack of concrete steps to change this. An expansion of majority decisions could only be realized with unanimous resolutions. The “Group of Friends” now wants to make “pragmatic concrete progress in the decision-making processes.” To this end, a regular stocktaking is planned in coordination with the other member states and the EU institutions. Membership in the group is open to all EU member states. rtr
EU-Außenpolitik
European policy
Felbermayr: Decoupling costs prosperity
Attempting to return the production of industrial goods from China to Germany and friendly countries would be costly and place a heavy burden on the economy in many regions. That is the conclusion of a new study by economist Gabriel Felbermayr of the Austrian Institute of Economic Research. Felbermayr, who headed the Kiel Institute for the World Economy (IfW) until 2021, conducted it on behalf of the Munich-based Foundation for Family Businesses.
The report not only focuses on China but on the decoupling of large economies outside the EU in general. Using a complex model, it attempts to calculate what effects the EU’s renunciation of trade with the countries in question would have on Germany’s real income:
USA: minus 3 percent,
China: minus 1.95 percent,
UK: minus 1.98 percent,
Russia: minus 1,19 percent.
If the EU were to theoretically decouple from all parts of the world (including Japan and Switzerland) simultaneously, the real income of German citizens would drop by a combined 20 percent in the short term. The Foundation for Family Businesses warns policymakers not to treat such ideas lightly.
A complete import halt of products and parts of the “mechanical engineering, equipment” trade category would particularly hit north-western Germany. Included are also microchips.
The study focuses on individual counties. A breakdown of trade with China would hit northwest Germany in particular. The effect is particularly noticeable in the electronics and machinery sector, including microchips; however, the study data combines imports from China and Taiwan. In contrast, southern Germany also has regions that would benefit. Here, on the other hand, a termination of trade with Switzerland would cause significant damage. fin
European policy
Heads
Oliver Stirböck – local ambassador for Europe
Oliver Stirböck is the European policy spokesman for the FDP parliamentary group in the Hessian state parliament.
Oliver Stirböck recalls that he had already predicted at the end of the 1990s that many people would take Europe for granted one day. “We have now reached that time, but we have to be careful that Europe is not taken too much for granted.”
Stirböck, spokesman for Europe for the FDP parliamentary group in the Hessian state parliament, says the same about the United Kingdom: “We have watched the Brexit and the associated loss of an important alliance partner here in Hesse with teary eyes.”
And yet this development is also followed by opportunities for Hesse, especially for Frankfurt as a financial center. Here, Stirböck would like to see more political commitment and better location marketing to promote the settlement of companies in Frankfurt.
Hessian interests in Europe
A business economist by training, he began his political involvement with the Young Liberals, where he was deputy federal chairman for three years. Since 2009, he has been a member of the FDP state executive committee and is the party’s deputy district chairman in the Rhine-Main region.
In 2019, Stirböck was elected to the Hessian state parliament and has since been part of the Europe Committee. For him, the committee’s overriding goal is to ensure that Hessian interests are heard more in Europe, as well as a goal-oriented approach to the effects of European decisions on state policy.
Sending the brightest minds to Brussels
Stirböck attests to a “mentality problem” in Germany with regard toEurope, which has led to the fact that in the past, the strongest candidates were not sent to Europe: “It should no longer be ‘If you have a grandfather, send him to Europe’, but we must send the brightest minds to Brussels“. There is still a lot to learn here from neighboring European countries, he said.
When it comes to energy, he said, it’s also appropriate to look to our neighbors: “We’re pretty much the only country in Europe that thinks it can do without nuclear energy, coal energy and gas. As free democrats, we advocate relying on nuclear energy as well, at least for the time being.”
Europe Committee as an ‘early warning system’
Stirböck sees himself as an “ambassador for Europe: He is interested in making European politics more tangible at the local level. In addition to numerous town twinning arrangements that can strengthen the European idea, Stirböck praises the fact that Europe is thought of in a non-partisan way in Hesse and that the parties pull together.
A good example of this is a proposal to deepen the partnership with North Macedonia. In the course of this, Stirböck was also part of a delegation trip to the country: “A strong yearning for Europe can be felt there and I think we must also offer these countries a serious prospect of accession so that they do not turn away from the West.”
Europe is an important cross-cutting issue, says Stirböck, which is also reflected in the Committees for Economic Affairs, Energy and Housing and for Digital Affairs and Data Protection, of which he is a member. The Europe Committee could represent an “early warning system” to identify at an early stage where there is a need for action and to optimize the dovetailing of state and European policy. Marlene Resch
