Media headlined yesterday’s meeting of the European Political Community in Prague as an “XXL summit” or “mega-summit”. Indeed, it was a massive event, with the heads of state and government of more than 40 European countries attending. It explicitly was not supposed to be an EU-only event, and yet the debate about how to deal with the energy crisis within the community of nations continued, as Ella Joyner reports.
A major sticking point is the EU-wide gas price cap, which many countries want but others clearly reject. The Commission is also skeptical. In the run-up to today’s informal EU summit, several member states have sent a proposal for a gas price cap to the Commission, to allay the EU authority’s concerns. It reportedly was drafted by Italy, Poland, Greece and Belgium. According to the proposal, the states only want to comply with the Commission’s demands, which it has formulated as a prerequisite for a price cap, in the event of a gas shortage. Read more in the News section.
Monday is the final deadline: By this date, EU states must take legal action before the European Court of Justice if they wish to challenge the Taxonomy Regulation, under which nuclear power and gas are considered sustainable under certain conditions. Despite considerable reservations among several member states, Austria will now likely be the only country to take this route. In any event, Germany backs down, and Luxembourg only wants to join the Austrians. In Vienna, on the other hand, opposition to nuclear power is so strong that even the right-wing populist FPÖ, as the opposition party, supports the complaint, as Eric Bonse reports.
It is an unprecedented trade dispute between China and an EU member: Since the establishment of a “Taiwan Office” in Lithuania’s capital Vilnius, relations between Lithuania and the People’s Republic have deteriorated steadily. “Only in isolated cases do products made by Lithuanian companies make it to the Chinese market,” says the Director General of the Lithuanian Confederation of Industrialists. To still bring exports to China, Lithuanian companies are coming up with quite a few ideas. The Baltic country also hopes for Brussels and the planned anti-coercion instrument, as Amelie Richter and Till Hoppe have discovered.
EU Commission President Ursula von der Leyen and Norway’s Prime Minister Jonas Gahr Støre used the meeting in Prague to announce closer cooperation to alleviate the energy price crisis. To this end, the EU Commission signed an agreement with Norway, a major gas supplier. The aim is to “significantly reduce excessively high prices in the short and longer term,” both sides announced in Prague on Thursday.
Norway and the EU Commission want to “jointly develop tools to stabilize energy markets and limit the impact of market manipulation and price volatility,” according to a joint communication. Brussels and Oslo did not name any specific proposal in it – the Commission presumably hopes this will defuse the dispute over how the EU should deal with the sharp rise in gas prices following Russia’s invasion of Ukraine.
Even during the summit, the debate on the implementation of a gas price cap continued. Several member states submitted a paper proposing a three-step process to address the Commission’s concerns. (We also report on this in the News.) Proponents argue that the gas price cap would be the best way to ensure that prices fall in all 27 EU countries.
German Chancellor Olaf Scholz and Dutch Prime Minister Mark Rutte, on the other hand, clearly oppose a cap at EU level. The Commission too is skeptical and attaches concrete conditions to the introduction of a gas price cap.
To lower gas prices, Scholz instead counts on negotiations with important supplier countries such as Norway and the USA, whose companies currently profit enormously since the desperate search for alternatives to Russian gas. Berlin sees a potential EU gas price cap as leverage for the talks, especially with Oslo.
A controversial issue in the EU energy debate are unilateral national aid packages. The German government’s €200 billion energy aid package drew heavy criticism in Prague – from Polish Prime Minister Mateusz Morawiecki, for example. He said it was “clear that it cannot be that the European Union’s energy policy is implemented under the dictates of Germany.”
Critics accuse Germany of subsidizing gas for households and companies, on the one hand, i.e. encouraging consumption, and on the other hand of blocking the EU price cap. Scholz responded that all states must help their citizens through this crisis. Germany is not the only state to adopt such a package, he said. The debate on how to deal with the energy crisis is also likely to continue at today’s informal EU summit.
The European Political Community format was proposed by France’s President Emmanuel Macron. The goal is to allow for closer exchanges between EU countries and partners outside the EU. “We share a common environment, often a common history, and we are called to write our future together,” Macron said in Prague. German Chancellor Olaf Scholz called the meeting a “great innovation.”
The round includes, in addition to the EU states, Albania, North Macedonia, Kosovo, Serbia, Bosnia and Herzegovina, Montenegro, Georgia, Moldova, Ukraine, Armenia and Azerbaijan, as well as the four EFTA countries (Norway, Switzerland, Iceland and Liechtenstein) and, last but not least, the United Kingdom and Turkey. Russia and Belarus had not been invited to the summit.
The agenda included talks on the security situation and the Russian invasion of Ukraine. Its President Volodymyr Zelenskiy joined the summit via video. Another topic was migration. As expected, the summit ended without any major decisions. The next meeting will take place in Chişinău next spring, Moldovan President Maia Sandu announced Thursday. with sas, dpa
The clock is ticking: By October 10 at the latest, EU states must take legal action before the European Court of Justice against the controversial taxonomy used by the EU Commission to classify nuclear power and gas as “sustainable” under certain conditions. Germany has already announced that it will not take legal action against the EU regulation, despite considerable concerns. Now Luxembourg also backs down.
The Grand Duchy does not intend to take action itself, but will merely join a lawsuit filed by Austria, said a spokesman for the Luxembourg Ministry of Energy in response to an inquiry from Europe.Table. This had been planned from the outset. However, Energy Minister Claude Turmes initially gave the impression in a tweet that Luxembourg itself would also take action before the ECJ. Now there is only talk of support. In the course of the so-called intervention, Luxembourg wants to support Austria’s lawsuit and present its own arguments in court.
Vienna appears determined. “Our position has not changed,” a spokeswoman for Energy and Climate Protection Minister Leonore Gewessler said in response to a question. Next Thursday, the Green politician plans to hold a media briefing on Austria’s position regarding the controversial classification of gas and nuclear energy as climate-friendly investments. Austria already decided against nuclear power decades ago. The anti-nuclear stance is part of the EU country’s political DNA. Even the right-wing populist FPÖ, as an opposition party, supports the lawsuit.
Still, Luxembourg’s stance is a bitter setback for the Austrian government. “We will continue to use the next weeks and months to win further allies,” Gewessler said as recently as July, when she announced legal steps against the taxonomy regulation.
At least Austria can continue to count on political support. “Luxembourg has not changed its position on the delegated act on taxonomy since its publication,” said Green MEP Tilly Metz. A separate lawsuit “would have no strategic benefit.” It would be much better to join forces and proceed in a coordinated manner, she said. Still, it is “a pity that not more Member States are clearly opposing the Delegated Act and the Commission’s overstepping of competencies,” she said.
In September, several country offices of the environmental organization Greenpeace announced to file a complaint before the ECJ if the Commission does not revise its decision. A complaint before the ECJ is the last chance to bring down the regulation. In June, the European Parliament voted by a narrow majority in favor of the European Commission’s proposal. In the Council, opponents have always been in the minority.
Just over a year ago, an unprecedented trade dispute between an EU state and China unfolded. The reason for the dispute was the opening of a “Taiwan Office” in Lithuania’s capital Vilnius. Beijing subsequently imposed sanctions against Lithuania. The European Union has since filed a complaint with the World Trade Organization (WTO) – but the situation for the Baltic EU state hardly improved since: “Generally speaking, all production is at a standstill. Exports from Lithuania to China have stopped. Only in isolated cases do products from Lithuanian companies make it to the Chinese market – mostly technology companies,” Ričardas Sartatavičius, Director General of the Lithuanian Confederation of Industrialists, told China.Table.
The deterioration of relations between the Baltic country and the People’s Republic happened gradually and ultimately peaked with Lithuania disappearing from China’s customs system altogether and downgrading diplomatic relations (China.Table reported). A few days after the tariff scandal in early December, the EU country reappeared as a choice option in the Chinese system. “But that doesn’t change the situation,” Sartatavičius says. Companies could fill out declarations, but then received no confirmation.
A current example is the beverage industry: Containers with beverages including beer were sent back from China to Lithuania because their customs declarations were rejected. The association cannot estimate the extent of the damage to the Lithuanian beverage industry so far. “But if the Chinese market is completely closed to them, companies could lose between €2 and €5 million in revenue a year,” he said. For the Lithuanian government, a small sum, but a lot of money for companies.”
In the spring of this year, the number of accepted goods unexpectedly increased slightly and then fell again over the summer. In September, Lithuanian imports to the People’s Republic fell by 91.4 percent compared to the same month last year, according to Chinese customs data. Metal and wood products, previously among the Baltic state’s top 5 export goods, were reportedly affected. Exports are “completely destroyed,” Sartatavičius said. High-tech lasers and peat exports are also among the affected products.
Lithuania’s exports to China suffered an almost complete collapse in December 2021. Only goods worth around €3.35 million made it through Chinese customs that month, as Sartatavičius explains. This represents a massive drop compared to the previous year, when goods worth €38 million made it through. Trade was still going in November 2021. Lithuania exported goods worth a good €37 million to the People’s Republic. In the same month, the Taiwanese trade office opened in Vilnius.
The few goods China allows to trickle into the country seem to be a smokescreen to complicate collecting evidence for the EU’s complaint to the WTO. But Lithuania is also resourceful. For example, they switch to ports in Riga, Latvia, or Gdańsk, Poland. Imports from the People’s Republic are also “tricked” and Riga is declared as the port of unloading. The Latvian capital has good truck transport connections to northern Lithuania. “Companies are naturally looking for different solutions,” says Sartatavičius.
Last year, China exerted pressure on companies from other EU countries that worked with Lithuanian suppliers or produced in Lithuania themselves. Here, too, the situation appears to remain difficult. Requests for talks with affected companies like tire manufacturer Continental have been rejected. Lithuanian companies are now hoping for success at the WTO, as Sartatavičius reports.
That could take some time, though. “We don’t expect a decision soon. It may take a couple of years.” Moreover, the direct benefits for Lithuanian companies are still uncertain: “According to the WTO rulings, there is no obligation to compensate for the losses incurred, nor is there a guarantee that the problems won’t arise again.”
Hope is now resting on Brussels: At the EU level, a new set of instruments to better respond to such practices is currently under deliberation. The EU Commission presented its proposal (China.Table reported) for the so-called Anti-Coercion Instrument at the end of 2021. Currently, the European Parliament and the Council of Member States are working on formulating their amendment requests. The trilogue between the EU institutions is expected to begin in the coming weeks to determine the final version of the regulation.
The Trade Committee is expected to finalize the European Parliament’s position next Monday. The MEPs want to tighten up the Commission’s proposal in some areas, as the amendments compiled by rapporteur Bernd Lange available to Europe.Table show. For example, the threat of coercive measures by third countries should be enough for the Commission to take action. In addition, it should be able to impose more extensive measures to compensate for the damage caused to an EU country.
The planned arsenal includes, for example, the option for the EU to impose higher tariffs on goods from China or other aggressive countries or to exclude their companies from public contracts in the EU. The Commission wants to grant itself far-reaching decision-making powers here. The European Parliament, however, is pushing for more far-reaching information obligations on the part of the authority. Member states also demand a greater say in the Council on the imposition of countermeasures. Collaboration: Till Hoppe
A day before the heads of state and government will meet, several EU members sent a more detailed proposal for an EU-wide gas price cap to the Commission yesterday. In the three-page document, which is available to Europe.Table, the supporters propose a three-step approach and attempt to address several concerns raised by the Commission.
The paper was drafted by Italy, Poland, Greece and Belgium, according to Council sources. However, the proposal summarized the discussion between a larger number of member states, said another EU diplomat.
In the event of the introduction of a gas price cap at the wholesale level, the Commission set out two key demands: higher, mandatory gas cuts and mandatory solidarity agreements. According to the paper, however, the member states do not intend to meet either demand until a gas shortage occurs.
When it comes to cutting consumption, they refuse to go beyond the gas-saving regulation already adopted this summer. According to the paper, solidarity agreements are to be signed by all member states, but they demand guidelines from the Commission beforehand.
In the event of a shortage, however, the states make the concession to abandon a gas price cap to ensure that gas can be distributed among EU members on a market basis.
However, in the absence of a gas shortage, the price cap is to apply. The corridor of “for example five percent” around a new price index is intended to leave sufficient room for bids to allow further gas flows in the internal market.
If the market price nears the cap or demand can no longer be met, further measures are to take effect in a second stage. First, “enhanced demand reduction and solidarity measures,” which are not specified in detail. Second, prices above the corridor are to be allowed in order to continue to secure imports. To this end, for example, the EU’s joint purchasing platform is to be able to sign contracts for differences. ber
Yesterday, the French government presented its energy-saving plan. It consists of 15 non-binding measures with the aim to cut the country’s energy consumption by 10 percent over two years (compared to 2019).
This “sobriété énergétique” plan is the result of nine working groups that met since June. The plans to reduce energy consumption focused on the following areas: exemplary government, companies and work organization, facilities open to the public and large shopping centers, industry, digital, sports, housing, mobility and local authorities.
The working group recommends, for example, reducing the temperature in all buildings to 19 degrees. This measure applies to industry, stores and public buildings. In sports facilities, the temperature is to be reduced by two degrees and the water temperature in swimming pools by one degree. Measures have also been announced regarding streetlights, lights in sports venues, or the introduction of automation and energy control systems in public buildings.
Another area covered by the savings plan is so-called “soft mobility” (mobilité douce). Incentives are to be created for private individuals to form carpools. The government explained that a comprehensive action plan on this matter will be presented soon. At the corporate level, there are calls to take the train instead of the car or plane for trips shorter than four hours. In addition, the increased use of videoconferencing is to be encouraged. For employees, the flat rate for sustainable mobility will be increased, for example from €200 to €300 in the public sector.
Some of the most important measures came from the working group on work organization. The first of these concerns working from home for government employees. This is to be promoted via a 15 percent increase in the flat rate for telework. In turn, companies must provide for “appropriate organization of telework in the event of special strain on the grid.” In addition, government employees may be required to postpone their work hours in the event of peak workloads. “It is up to individual companies to monitor their plan,” the government said. No control mechanism has been mentioned so far.
Private individuals are to be supported in their efforts by the introduction of a savings bonus for exemplary households. In addition, a bonus of €9,000 was announced for the installation of an air-to-water heat pump and a bonus of €15,000 for the installation of a wood pellet boiler.
Another measure aims to inform citizens: the plan is to broadcast information about the power grid load with green, yellow and red symbols on television after the usual weather report and in between other broadcasts. The hope is to reach four out of five people in France this way. Several television stations, including TF1 and France Télévision, already announced their support for the measure. The government stressed that none of these measures were binding. cst
The search for a successor to the departing managing director of the European Stability Mechanism ESM, Klaus Regling, continues. The euro states could only agree on an interim solution at an extraordinary board meeting.
According to an ESM statement, the French deputy managing director, Christophe Frankel, is to assume the duties of managing director until December 31, 2022. The period could also be shortened should the board of directors appoint a permanent managing director in the meantime. Frankel will start his interim mandate tomorrow; Klaus Regling’s mandate expires today. Regling headed the ESM for more than ten years.
Paschal Donohoe, Chairman of the ESM Board of Governors, stressed in the statement that the selection process for Regling’s successor started months ago with several promising candidates, “but none of them could reach the very high threshold of 80 percent of the votes cast.” Donohoe stressed that to ensure the continuity of the day-to-day operations of the stability mechanism, the board of directors appointed Christophe Frankel as interim head of the ESM. Frankel has served as deputy managing director of the ESM since its inception in 2012 and has “an outstanding professional background in finance and financial markets,” the board chairman said. cr
Adrian Vázquez Lázara, Chair of the Legal Affairs Committee in the European Parliament, sees the conclusion of a Transatlantic Data Privacy Framework (TADPF) as a prerequisite for further progress on EU-US digital issues. “The most important issue we need to solve before we move forward is data protection,” he told Europe.Table. A successor to the Privacy Shield, which failed in the European Court of Justice two years ago, remains in dispute since shortly after the Biden administration took office.
The US government plans to present a solution in the coming days on how to better improve data protection in the US covered by the General Data Protection Regulation. To this end, Joe Biden wants to issue presidential decrees, which in turn will form the basis for the EU Commission to draw up a proposal for an adequacy decision. This is a formal prerequisite for simplified permission to transfer personal data to non-EU countries.
“Once the TADPF is clarified, we can move on to other aspects,” says Adrian Vázquez Lázara. Greater interoperability between the two jurisdictions is a political goal, but so far the regulations are often incompatible. “How are we going to regulate artificial intelligence on both sides of the ocean? How do we deal with the Digital Services Act so US companies don’t feel threatened?” These are issues to be addressed under TADPF, he said. For better regulation of artificial intelligence, the White House submitted proposals this week.
A new legal framework for transatlantic data transfer will also bring new momentum to the talks in the Trade and Technology Council (TTC), the Spanish liberal politician expects. “The TTC is a great opportunity, even if it has not brought anything tangible so far.”
But it was time to involve parliaments and other stakeholders in the talks between the EU Commission and the US government, Vázquez Lázara urged. The Legal Affairs Committee will formally request the Commission to negotiate with the US government on participation. “I am confident that we will succeed in the end.”
Talks by a JURI committee delegation in Washington showed that interlocutors on the US congressional side knew little about European regulatory projects, such as the AI Act or liability issues. “That’s remarkable because US companies will be affected.” That is why legislative representatives should also exchange views at the TTC, and both sides should be invited to the TTC to hear concerns. “That’s the best way to find common ground and level the playing field.” tho/fst
Germany prepares a new space strategy. In the digital age and in light of the geopolitical situation, capabilities in space are essential building blocks of German and European sovereignty, according to an impulse paper for German space policy presented by Anna Christmann (Greens) on Thursday. The German government’s aerospace coordinator invited members of the aerospace community to Berlin to discuss the new strategy.
Christmann places particular emphasis on New Space, in other words, the commercialization of spaceflight and its integration with the traditional economy. “We need to get to a more competitive development in space,” Christmann said. “Even in the carrier sector.”
Furthermore, the space coordinator also referred to the EU’s Secure Connectivity Program to establish a secure communications network in low-Earth orbit. “We need to launch a European connectivity initiative, keeping competition and demand in mind,” the impulse paper states.
According to Christmann, the German government welcomes the Council’s position to divide the satellite-based communications network into several individual projects to allow appropriate participation by SMEs. Christmann added that she exchanged views with EU Internal Market Commissioner Thierry Breton on Secure Connectivity, including the involvement of the European Space Agency (ESA) in the project. It is important that it is properly focused, she said. “We will work hard for that.”
The ESA Council of Ministers will meet in Paris on November 22 and 23. The agency’s highest body prepares the European space plan and ensures long-term funding for activities “In the medium term, European space structures must become even more efficient,” the paper says. Among other things, the paper calls for clearly defined roles of ESA and the EU in space. “To be successful in the long term, we must define today what role Germany can and wants to play in space exploration: What happens after the end of the International Space Station ISS, how do we participate in the US Artemis program?”
The Federal Ministry of Economics and Technology, as the lead space ministry in Germany, assumes “that we will be much more dependent on space applications in the future in order to meet the major challenges facing society and to safeguard our own sovereignty”. It regards space as “an essential strategic field for the future” and the German space strategy as a complement to the European strategy.
The ministry has identified six fields of action for strategy development:
The conclusion: Germany must set itself ambitious goals in its new space strategy, and the right course must be set now. vis
Will the energy crisis be served as an appetizer, main course or dessert? After all, today’s informal summit precedes the equally informal meeting of EU energy ministers, which will be held next week in Prague. And all these informal summits are a prelude to the next European Council on October 20 and 21, when energy issues will once again be at the top of the political agenda.
One question keeps cropping up in the choreography of these summits: The question of seating arrangements, for example at dinner. And the question is by no means harmless. Who will sit next to each other? What would the frugal Mark Rutte and Kyriakos Mitsotakis, whose country has been swept away by the financial crisis, talk about? What pleasantries might Emmanuel Macron and Viktor Orbán exchange over a fine Burgundy?
It may not look like it, but we are touching the very heart of European negotiations here, where things can sting very badly: building consensus. Here, every means is justified, be it at the working table or the dinner table. The other side of the coin can also be observed here, namely the unanimity rule. With the prospect that the European Union might exceed 30 member states in the not-too-distant future, the end of the unanimity principle returns with a bang in favor of the majority vote.
The call to expand majority voting is a recurring theme in the debate about the EU’s ability to act – as Nicolai von Ondarza, Head of the EU/Europe research group at the SWP, and collaborator Julina Mintel remind us in a recently published analysis. “In a Union of currently 27 member states, the expansion of majority voting is supposed to guarantee that the number of veto players is reduced, thus making compromises easier,” they write.
The so-called passerelle clause in the EU Treaty is to be used here. The what-now? So slowly one more time. A “passerelle” is a small bridge, a footbridge that allows you to cross. In other words, the clause brings a certain flexibility to the EU’s decision-making process.
For those who missed European policy classes: Under certain conditions, passerelle clauses allow the switch from decision-making by unanimity to a qualified majority. These flexible elements allow treaties to be adapted without having to go through the revision procedure. However, their use is conditional, in particular on notification of the national parliaments.
The European Council must inform the national parliaments of its decision. If a national parliament notifies its objection within six months, the EU decision will not be adopted. If no such objection is made, the decision may enter into force after its adoption by the European Council. In this case, the amendment made is then final. However, in some areas (multiannual financial framework, CFSP, certain measures in social policy, environment, etc.), parliaments of member countries cannot raise an objection. Moreover, the passerelle clause cannot be applied to “decisions on military involvement or in the area of defence.”
These days, it is mainly Central and Eastern European states that reject majority decisions, as SWP researchers von Ondarza and Mintel write. “They fear that the EU could become dominated by France and Germany and that concerns of smaller members might be ignored in foreign and security policy.”
A look at the voting protocols justifies their concerns. France is hardly ever outvoted, while Germany has only rarely been outvoted in recent years, but small Central and Eastern European member states have been outvoted more frequently, the analysts continue. “It is therefore not politically surprising that these states, in particular, are skeptical about a renewed expansion of majority voting.”
Still, an EU with 30 or more members, including several new ones with a population of less than 10 million, can only remain effective if majority rule is introduced across the board – except for a few constitutional decisions, as von Ondarza and Mintel point out.
That is why they suggest combining qualified majority voting in critical areas with an “emergency brake.” “With it, a politically definable small number of member states could have a decision taken by the qualified majority that affects their vital national interests resubmitted to the European Council,” they write.
“The power of football is the power of the people of Europe,” Commission Vice-President Margaritis Schinas courted UEFA boss Aleksander Čeferin yesterday. On Thursday, both signed a new agreement on cooperation to promote the values and principles of the European Sport Model.
It is already the third of its kind and is intended to support “climate protection, the Green Deal and healthy and active lifestyles for all”. Not through binding and verifiable obligations, but through rather shallow declarations of intent. One example: The UEFA and EU reaffirm their “strong commitment to promoting healthy and active lifestyles across generations and social groups and further commit to leveraging the power of football in encouraging healthy and active lifestyles.” No one knows what that actually means.
The fact that the UEFA is not particularly known for being an inclusive health-oriented climate protection association – and this has not changed since the first agreement in 2014 – apparently plays no role in such arrangements. More and more tournaments, matches, and elitist financing models suggest greed for profit on the part of UEFA officials rather than a desire for reform in the interests of football fans or climate protection.
So while Schinas talks about the power of football, he fails to mention the EU Commission‘s lack of power, which every once in a blue moon comes up with nothing more than non-binding declarations of intent. So far, virtually nothing came of these initiatives. The only thing green about the world of football is the grass.
But at the very least, the intention is to “cooperate on the delivery of EURO 2024 in Germany as a flagship for the sustainability of such sporting events“. How exactly this cooperation will look is not revealed. But if Schinas wants to continue to claim that European football is one of Europe’s success stories, he and the Commission should turn words into deeds. Lukas Scheid
Media headlined yesterday’s meeting of the European Political Community in Prague as an “XXL summit” or “mega-summit”. Indeed, it was a massive event, with the heads of state and government of more than 40 European countries attending. It explicitly was not supposed to be an EU-only event, and yet the debate about how to deal with the energy crisis within the community of nations continued, as Ella Joyner reports.
A major sticking point is the EU-wide gas price cap, which many countries want but others clearly reject. The Commission is also skeptical. In the run-up to today’s informal EU summit, several member states have sent a proposal for a gas price cap to the Commission, to allay the EU authority’s concerns. It reportedly was drafted by Italy, Poland, Greece and Belgium. According to the proposal, the states only want to comply with the Commission’s demands, which it has formulated as a prerequisite for a price cap, in the event of a gas shortage. Read more in the News section.
Monday is the final deadline: By this date, EU states must take legal action before the European Court of Justice if they wish to challenge the Taxonomy Regulation, under which nuclear power and gas are considered sustainable under certain conditions. Despite considerable reservations among several member states, Austria will now likely be the only country to take this route. In any event, Germany backs down, and Luxembourg only wants to join the Austrians. In Vienna, on the other hand, opposition to nuclear power is so strong that even the right-wing populist FPÖ, as the opposition party, supports the complaint, as Eric Bonse reports.
It is an unprecedented trade dispute between China and an EU member: Since the establishment of a “Taiwan Office” in Lithuania’s capital Vilnius, relations between Lithuania and the People’s Republic have deteriorated steadily. “Only in isolated cases do products made by Lithuanian companies make it to the Chinese market,” says the Director General of the Lithuanian Confederation of Industrialists. To still bring exports to China, Lithuanian companies are coming up with quite a few ideas. The Baltic country also hopes for Brussels and the planned anti-coercion instrument, as Amelie Richter and Till Hoppe have discovered.
EU Commission President Ursula von der Leyen and Norway’s Prime Minister Jonas Gahr Støre used the meeting in Prague to announce closer cooperation to alleviate the energy price crisis. To this end, the EU Commission signed an agreement with Norway, a major gas supplier. The aim is to “significantly reduce excessively high prices in the short and longer term,” both sides announced in Prague on Thursday.
Norway and the EU Commission want to “jointly develop tools to stabilize energy markets and limit the impact of market manipulation and price volatility,” according to a joint communication. Brussels and Oslo did not name any specific proposal in it – the Commission presumably hopes this will defuse the dispute over how the EU should deal with the sharp rise in gas prices following Russia’s invasion of Ukraine.
Even during the summit, the debate on the implementation of a gas price cap continued. Several member states submitted a paper proposing a three-step process to address the Commission’s concerns. (We also report on this in the News.) Proponents argue that the gas price cap would be the best way to ensure that prices fall in all 27 EU countries.
German Chancellor Olaf Scholz and Dutch Prime Minister Mark Rutte, on the other hand, clearly oppose a cap at EU level. The Commission too is skeptical and attaches concrete conditions to the introduction of a gas price cap.
To lower gas prices, Scholz instead counts on negotiations with important supplier countries such as Norway and the USA, whose companies currently profit enormously since the desperate search for alternatives to Russian gas. Berlin sees a potential EU gas price cap as leverage for the talks, especially with Oslo.
A controversial issue in the EU energy debate are unilateral national aid packages. The German government’s €200 billion energy aid package drew heavy criticism in Prague – from Polish Prime Minister Mateusz Morawiecki, for example. He said it was “clear that it cannot be that the European Union’s energy policy is implemented under the dictates of Germany.”
Critics accuse Germany of subsidizing gas for households and companies, on the one hand, i.e. encouraging consumption, and on the other hand of blocking the EU price cap. Scholz responded that all states must help their citizens through this crisis. Germany is not the only state to adopt such a package, he said. The debate on how to deal with the energy crisis is also likely to continue at today’s informal EU summit.
The European Political Community format was proposed by France’s President Emmanuel Macron. The goal is to allow for closer exchanges between EU countries and partners outside the EU. “We share a common environment, often a common history, and we are called to write our future together,” Macron said in Prague. German Chancellor Olaf Scholz called the meeting a “great innovation.”
The round includes, in addition to the EU states, Albania, North Macedonia, Kosovo, Serbia, Bosnia and Herzegovina, Montenegro, Georgia, Moldova, Ukraine, Armenia and Azerbaijan, as well as the four EFTA countries (Norway, Switzerland, Iceland and Liechtenstein) and, last but not least, the United Kingdom and Turkey. Russia and Belarus had not been invited to the summit.
The agenda included talks on the security situation and the Russian invasion of Ukraine. Its President Volodymyr Zelenskiy joined the summit via video. Another topic was migration. As expected, the summit ended without any major decisions. The next meeting will take place in Chişinău next spring, Moldovan President Maia Sandu announced Thursday. with sas, dpa
The clock is ticking: By October 10 at the latest, EU states must take legal action before the European Court of Justice against the controversial taxonomy used by the EU Commission to classify nuclear power and gas as “sustainable” under certain conditions. Germany has already announced that it will not take legal action against the EU regulation, despite considerable concerns. Now Luxembourg also backs down.
The Grand Duchy does not intend to take action itself, but will merely join a lawsuit filed by Austria, said a spokesman for the Luxembourg Ministry of Energy in response to an inquiry from Europe.Table. This had been planned from the outset. However, Energy Minister Claude Turmes initially gave the impression in a tweet that Luxembourg itself would also take action before the ECJ. Now there is only talk of support. In the course of the so-called intervention, Luxembourg wants to support Austria’s lawsuit and present its own arguments in court.
Vienna appears determined. “Our position has not changed,” a spokeswoman for Energy and Climate Protection Minister Leonore Gewessler said in response to a question. Next Thursday, the Green politician plans to hold a media briefing on Austria’s position regarding the controversial classification of gas and nuclear energy as climate-friendly investments. Austria already decided against nuclear power decades ago. The anti-nuclear stance is part of the EU country’s political DNA. Even the right-wing populist FPÖ, as an opposition party, supports the lawsuit.
Still, Luxembourg’s stance is a bitter setback for the Austrian government. “We will continue to use the next weeks and months to win further allies,” Gewessler said as recently as July, when she announced legal steps against the taxonomy regulation.
At least Austria can continue to count on political support. “Luxembourg has not changed its position on the delegated act on taxonomy since its publication,” said Green MEP Tilly Metz. A separate lawsuit “would have no strategic benefit.” It would be much better to join forces and proceed in a coordinated manner, she said. Still, it is “a pity that not more Member States are clearly opposing the Delegated Act and the Commission’s overstepping of competencies,” she said.
In September, several country offices of the environmental organization Greenpeace announced to file a complaint before the ECJ if the Commission does not revise its decision. A complaint before the ECJ is the last chance to bring down the regulation. In June, the European Parliament voted by a narrow majority in favor of the European Commission’s proposal. In the Council, opponents have always been in the minority.
Just over a year ago, an unprecedented trade dispute between an EU state and China unfolded. The reason for the dispute was the opening of a “Taiwan Office” in Lithuania’s capital Vilnius. Beijing subsequently imposed sanctions against Lithuania. The European Union has since filed a complaint with the World Trade Organization (WTO) – but the situation for the Baltic EU state hardly improved since: “Generally speaking, all production is at a standstill. Exports from Lithuania to China have stopped. Only in isolated cases do products from Lithuanian companies make it to the Chinese market – mostly technology companies,” Ričardas Sartatavičius, Director General of the Lithuanian Confederation of Industrialists, told China.Table.
The deterioration of relations between the Baltic country and the People’s Republic happened gradually and ultimately peaked with Lithuania disappearing from China’s customs system altogether and downgrading diplomatic relations (China.Table reported). A few days after the tariff scandal in early December, the EU country reappeared as a choice option in the Chinese system. “But that doesn’t change the situation,” Sartatavičius says. Companies could fill out declarations, but then received no confirmation.
A current example is the beverage industry: Containers with beverages including beer were sent back from China to Lithuania because their customs declarations were rejected. The association cannot estimate the extent of the damage to the Lithuanian beverage industry so far. “But if the Chinese market is completely closed to them, companies could lose between €2 and €5 million in revenue a year,” he said. For the Lithuanian government, a small sum, but a lot of money for companies.”
In the spring of this year, the number of accepted goods unexpectedly increased slightly and then fell again over the summer. In September, Lithuanian imports to the People’s Republic fell by 91.4 percent compared to the same month last year, according to Chinese customs data. Metal and wood products, previously among the Baltic state’s top 5 export goods, were reportedly affected. Exports are “completely destroyed,” Sartatavičius said. High-tech lasers and peat exports are also among the affected products.
Lithuania’s exports to China suffered an almost complete collapse in December 2021. Only goods worth around €3.35 million made it through Chinese customs that month, as Sartatavičius explains. This represents a massive drop compared to the previous year, when goods worth €38 million made it through. Trade was still going in November 2021. Lithuania exported goods worth a good €37 million to the People’s Republic. In the same month, the Taiwanese trade office opened in Vilnius.
The few goods China allows to trickle into the country seem to be a smokescreen to complicate collecting evidence for the EU’s complaint to the WTO. But Lithuania is also resourceful. For example, they switch to ports in Riga, Latvia, or Gdańsk, Poland. Imports from the People’s Republic are also “tricked” and Riga is declared as the port of unloading. The Latvian capital has good truck transport connections to northern Lithuania. “Companies are naturally looking for different solutions,” says Sartatavičius.
Last year, China exerted pressure on companies from other EU countries that worked with Lithuanian suppliers or produced in Lithuania themselves. Here, too, the situation appears to remain difficult. Requests for talks with affected companies like tire manufacturer Continental have been rejected. Lithuanian companies are now hoping for success at the WTO, as Sartatavičius reports.
That could take some time, though. “We don’t expect a decision soon. It may take a couple of years.” Moreover, the direct benefits for Lithuanian companies are still uncertain: “According to the WTO rulings, there is no obligation to compensate for the losses incurred, nor is there a guarantee that the problems won’t arise again.”
Hope is now resting on Brussels: At the EU level, a new set of instruments to better respond to such practices is currently under deliberation. The EU Commission presented its proposal (China.Table reported) for the so-called Anti-Coercion Instrument at the end of 2021. Currently, the European Parliament and the Council of Member States are working on formulating their amendment requests. The trilogue between the EU institutions is expected to begin in the coming weeks to determine the final version of the regulation.
The Trade Committee is expected to finalize the European Parliament’s position next Monday. The MEPs want to tighten up the Commission’s proposal in some areas, as the amendments compiled by rapporteur Bernd Lange available to Europe.Table show. For example, the threat of coercive measures by third countries should be enough for the Commission to take action. In addition, it should be able to impose more extensive measures to compensate for the damage caused to an EU country.
The planned arsenal includes, for example, the option for the EU to impose higher tariffs on goods from China or other aggressive countries or to exclude their companies from public contracts in the EU. The Commission wants to grant itself far-reaching decision-making powers here. The European Parliament, however, is pushing for more far-reaching information obligations on the part of the authority. Member states also demand a greater say in the Council on the imposition of countermeasures. Collaboration: Till Hoppe
A day before the heads of state and government will meet, several EU members sent a more detailed proposal for an EU-wide gas price cap to the Commission yesterday. In the three-page document, which is available to Europe.Table, the supporters propose a three-step approach and attempt to address several concerns raised by the Commission.
The paper was drafted by Italy, Poland, Greece and Belgium, according to Council sources. However, the proposal summarized the discussion between a larger number of member states, said another EU diplomat.
In the event of the introduction of a gas price cap at the wholesale level, the Commission set out two key demands: higher, mandatory gas cuts and mandatory solidarity agreements. According to the paper, however, the member states do not intend to meet either demand until a gas shortage occurs.
When it comes to cutting consumption, they refuse to go beyond the gas-saving regulation already adopted this summer. According to the paper, solidarity agreements are to be signed by all member states, but they demand guidelines from the Commission beforehand.
In the event of a shortage, however, the states make the concession to abandon a gas price cap to ensure that gas can be distributed among EU members on a market basis.
However, in the absence of a gas shortage, the price cap is to apply. The corridor of “for example five percent” around a new price index is intended to leave sufficient room for bids to allow further gas flows in the internal market.
If the market price nears the cap or demand can no longer be met, further measures are to take effect in a second stage. First, “enhanced demand reduction and solidarity measures,” which are not specified in detail. Second, prices above the corridor are to be allowed in order to continue to secure imports. To this end, for example, the EU’s joint purchasing platform is to be able to sign contracts for differences. ber
Yesterday, the French government presented its energy-saving plan. It consists of 15 non-binding measures with the aim to cut the country’s energy consumption by 10 percent over two years (compared to 2019).
This “sobriété énergétique” plan is the result of nine working groups that met since June. The plans to reduce energy consumption focused on the following areas: exemplary government, companies and work organization, facilities open to the public and large shopping centers, industry, digital, sports, housing, mobility and local authorities.
The working group recommends, for example, reducing the temperature in all buildings to 19 degrees. This measure applies to industry, stores and public buildings. In sports facilities, the temperature is to be reduced by two degrees and the water temperature in swimming pools by one degree. Measures have also been announced regarding streetlights, lights in sports venues, or the introduction of automation and energy control systems in public buildings.
Another area covered by the savings plan is so-called “soft mobility” (mobilité douce). Incentives are to be created for private individuals to form carpools. The government explained that a comprehensive action plan on this matter will be presented soon. At the corporate level, there are calls to take the train instead of the car or plane for trips shorter than four hours. In addition, the increased use of videoconferencing is to be encouraged. For employees, the flat rate for sustainable mobility will be increased, for example from €200 to €300 in the public sector.
Some of the most important measures came from the working group on work organization. The first of these concerns working from home for government employees. This is to be promoted via a 15 percent increase in the flat rate for telework. In turn, companies must provide for “appropriate organization of telework in the event of special strain on the grid.” In addition, government employees may be required to postpone their work hours in the event of peak workloads. “It is up to individual companies to monitor their plan,” the government said. No control mechanism has been mentioned so far.
Private individuals are to be supported in their efforts by the introduction of a savings bonus for exemplary households. In addition, a bonus of €9,000 was announced for the installation of an air-to-water heat pump and a bonus of €15,000 for the installation of a wood pellet boiler.
Another measure aims to inform citizens: the plan is to broadcast information about the power grid load with green, yellow and red symbols on television after the usual weather report and in between other broadcasts. The hope is to reach four out of five people in France this way. Several television stations, including TF1 and France Télévision, already announced their support for the measure. The government stressed that none of these measures were binding. cst
The search for a successor to the departing managing director of the European Stability Mechanism ESM, Klaus Regling, continues. The euro states could only agree on an interim solution at an extraordinary board meeting.
According to an ESM statement, the French deputy managing director, Christophe Frankel, is to assume the duties of managing director until December 31, 2022. The period could also be shortened should the board of directors appoint a permanent managing director in the meantime. Frankel will start his interim mandate tomorrow; Klaus Regling’s mandate expires today. Regling headed the ESM for more than ten years.
Paschal Donohoe, Chairman of the ESM Board of Governors, stressed in the statement that the selection process for Regling’s successor started months ago with several promising candidates, “but none of them could reach the very high threshold of 80 percent of the votes cast.” Donohoe stressed that to ensure the continuity of the day-to-day operations of the stability mechanism, the board of directors appointed Christophe Frankel as interim head of the ESM. Frankel has served as deputy managing director of the ESM since its inception in 2012 and has “an outstanding professional background in finance and financial markets,” the board chairman said. cr
Adrian Vázquez Lázara, Chair of the Legal Affairs Committee in the European Parliament, sees the conclusion of a Transatlantic Data Privacy Framework (TADPF) as a prerequisite for further progress on EU-US digital issues. “The most important issue we need to solve before we move forward is data protection,” he told Europe.Table. A successor to the Privacy Shield, which failed in the European Court of Justice two years ago, remains in dispute since shortly after the Biden administration took office.
The US government plans to present a solution in the coming days on how to better improve data protection in the US covered by the General Data Protection Regulation. To this end, Joe Biden wants to issue presidential decrees, which in turn will form the basis for the EU Commission to draw up a proposal for an adequacy decision. This is a formal prerequisite for simplified permission to transfer personal data to non-EU countries.
“Once the TADPF is clarified, we can move on to other aspects,” says Adrian Vázquez Lázara. Greater interoperability between the two jurisdictions is a political goal, but so far the regulations are often incompatible. “How are we going to regulate artificial intelligence on both sides of the ocean? How do we deal with the Digital Services Act so US companies don’t feel threatened?” These are issues to be addressed under TADPF, he said. For better regulation of artificial intelligence, the White House submitted proposals this week.
A new legal framework for transatlantic data transfer will also bring new momentum to the talks in the Trade and Technology Council (TTC), the Spanish liberal politician expects. “The TTC is a great opportunity, even if it has not brought anything tangible so far.”
But it was time to involve parliaments and other stakeholders in the talks between the EU Commission and the US government, Vázquez Lázara urged. The Legal Affairs Committee will formally request the Commission to negotiate with the US government on participation. “I am confident that we will succeed in the end.”
Talks by a JURI committee delegation in Washington showed that interlocutors on the US congressional side knew little about European regulatory projects, such as the AI Act or liability issues. “That’s remarkable because US companies will be affected.” That is why legislative representatives should also exchange views at the TTC, and both sides should be invited to the TTC to hear concerns. “That’s the best way to find common ground and level the playing field.” tho/fst
Germany prepares a new space strategy. In the digital age and in light of the geopolitical situation, capabilities in space are essential building blocks of German and European sovereignty, according to an impulse paper for German space policy presented by Anna Christmann (Greens) on Thursday. The German government’s aerospace coordinator invited members of the aerospace community to Berlin to discuss the new strategy.
Christmann places particular emphasis on New Space, in other words, the commercialization of spaceflight and its integration with the traditional economy. “We need to get to a more competitive development in space,” Christmann said. “Even in the carrier sector.”
Furthermore, the space coordinator also referred to the EU’s Secure Connectivity Program to establish a secure communications network in low-Earth orbit. “We need to launch a European connectivity initiative, keeping competition and demand in mind,” the impulse paper states.
According to Christmann, the German government welcomes the Council’s position to divide the satellite-based communications network into several individual projects to allow appropriate participation by SMEs. Christmann added that she exchanged views with EU Internal Market Commissioner Thierry Breton on Secure Connectivity, including the involvement of the European Space Agency (ESA) in the project. It is important that it is properly focused, she said. “We will work hard for that.”
The ESA Council of Ministers will meet in Paris on November 22 and 23. The agency’s highest body prepares the European space plan and ensures long-term funding for activities “In the medium term, European space structures must become even more efficient,” the paper says. Among other things, the paper calls for clearly defined roles of ESA and the EU in space. “To be successful in the long term, we must define today what role Germany can and wants to play in space exploration: What happens after the end of the International Space Station ISS, how do we participate in the US Artemis program?”
The Federal Ministry of Economics and Technology, as the lead space ministry in Germany, assumes “that we will be much more dependent on space applications in the future in order to meet the major challenges facing society and to safeguard our own sovereignty”. It regards space as “an essential strategic field for the future” and the German space strategy as a complement to the European strategy.
The ministry has identified six fields of action for strategy development:
The conclusion: Germany must set itself ambitious goals in its new space strategy, and the right course must be set now. vis
Will the energy crisis be served as an appetizer, main course or dessert? After all, today’s informal summit precedes the equally informal meeting of EU energy ministers, which will be held next week in Prague. And all these informal summits are a prelude to the next European Council on October 20 and 21, when energy issues will once again be at the top of the political agenda.
One question keeps cropping up in the choreography of these summits: The question of seating arrangements, for example at dinner. And the question is by no means harmless. Who will sit next to each other? What would the frugal Mark Rutte and Kyriakos Mitsotakis, whose country has been swept away by the financial crisis, talk about? What pleasantries might Emmanuel Macron and Viktor Orbán exchange over a fine Burgundy?
It may not look like it, but we are touching the very heart of European negotiations here, where things can sting very badly: building consensus. Here, every means is justified, be it at the working table or the dinner table. The other side of the coin can also be observed here, namely the unanimity rule. With the prospect that the European Union might exceed 30 member states in the not-too-distant future, the end of the unanimity principle returns with a bang in favor of the majority vote.
The call to expand majority voting is a recurring theme in the debate about the EU’s ability to act – as Nicolai von Ondarza, Head of the EU/Europe research group at the SWP, and collaborator Julina Mintel remind us in a recently published analysis. “In a Union of currently 27 member states, the expansion of majority voting is supposed to guarantee that the number of veto players is reduced, thus making compromises easier,” they write.
The so-called passerelle clause in the EU Treaty is to be used here. The what-now? So slowly one more time. A “passerelle” is a small bridge, a footbridge that allows you to cross. In other words, the clause brings a certain flexibility to the EU’s decision-making process.
For those who missed European policy classes: Under certain conditions, passerelle clauses allow the switch from decision-making by unanimity to a qualified majority. These flexible elements allow treaties to be adapted without having to go through the revision procedure. However, their use is conditional, in particular on notification of the national parliaments.
The European Council must inform the national parliaments of its decision. If a national parliament notifies its objection within six months, the EU decision will not be adopted. If no such objection is made, the decision may enter into force after its adoption by the European Council. In this case, the amendment made is then final. However, in some areas (multiannual financial framework, CFSP, certain measures in social policy, environment, etc.), parliaments of member countries cannot raise an objection. Moreover, the passerelle clause cannot be applied to “decisions on military involvement or in the area of defence.”
These days, it is mainly Central and Eastern European states that reject majority decisions, as SWP researchers von Ondarza and Mintel write. “They fear that the EU could become dominated by France and Germany and that concerns of smaller members might be ignored in foreign and security policy.”
A look at the voting protocols justifies their concerns. France is hardly ever outvoted, while Germany has only rarely been outvoted in recent years, but small Central and Eastern European member states have been outvoted more frequently, the analysts continue. “It is therefore not politically surprising that these states, in particular, are skeptical about a renewed expansion of majority voting.”
Still, an EU with 30 or more members, including several new ones with a population of less than 10 million, can only remain effective if majority rule is introduced across the board – except for a few constitutional decisions, as von Ondarza and Mintel point out.
That is why they suggest combining qualified majority voting in critical areas with an “emergency brake.” “With it, a politically definable small number of member states could have a decision taken by the qualified majority that affects their vital national interests resubmitted to the European Council,” they write.
“The power of football is the power of the people of Europe,” Commission Vice-President Margaritis Schinas courted UEFA boss Aleksander Čeferin yesterday. On Thursday, both signed a new agreement on cooperation to promote the values and principles of the European Sport Model.
It is already the third of its kind and is intended to support “climate protection, the Green Deal and healthy and active lifestyles for all”. Not through binding and verifiable obligations, but through rather shallow declarations of intent. One example: The UEFA and EU reaffirm their “strong commitment to promoting healthy and active lifestyles across generations and social groups and further commit to leveraging the power of football in encouraging healthy and active lifestyles.” No one knows what that actually means.
The fact that the UEFA is not particularly known for being an inclusive health-oriented climate protection association – and this has not changed since the first agreement in 2014 – apparently plays no role in such arrangements. More and more tournaments, matches, and elitist financing models suggest greed for profit on the part of UEFA officials rather than a desire for reform in the interests of football fans or climate protection.
So while Schinas talks about the power of football, he fails to mention the EU Commission‘s lack of power, which every once in a blue moon comes up with nothing more than non-binding declarations of intent. So far, virtually nothing came of these initiatives. The only thing green about the world of football is the grass.
But at the very least, the intention is to “cooperate on the delivery of EURO 2024 in Germany as a flagship for the sustainability of such sporting events“. How exactly this cooperation will look is not revealed. But if Schinas wants to continue to claim that European football is one of Europe’s success stories, he and the Commission should turn words into deeds. Lukas Scheid