The EU taxonomy was originally intended as a guide for private investors: Which investments are compatible with the EU’s climate and nature conservation goals? It was not intended that natural gas should be classified as a sustainable energy source. Things turned out differently, and the new taxonomy has become one of the major political issues at present. In his analysis, Timo Landenberger looks back at the genesis of the regulations, sheds light on where the limit values come from, and captures voices from politics and business.
The definition of digital rights and principles in the “Digital Compass”, a strategy for space traffic management, a legislative proposal to fight child sexual abuse more effectively, and much more: There are some new digital policy proposals on the EU Commission’s calendar for the first quarter of this year. Jasmin Kohl knows what exactly the authority is planning and what open questions remain.
Within a few months, the taxonomy was dragged out of its shadowy existence into the political spotlight and discussed more heatedly than almost any other EU topic at present. Initially, the rules were only intended as a guide for private investors, listing which financial transactions are to be classified as sustainable and which are not. Natural gas was not one of them.
The EU Commission appointed a panel of experts to draw up the criteria, which originally envisaged a limit value of 100g CO2 equivalent per kWh of electricity generated for power plants. This can only be achieved with green or blue hydrogen and efficient carbon capture and storage (CCS), not with pure natural gas.
As a result of the political debate, however, the current taxonomy draft now also provides for higher emissions to be permitted, provided a number of criteria are met. Accordingly, plants whose construction permit was issued before December 31st, 2030, can emit up to 270 g/kWh. The value also comes from a recommendation of the Commission’s taxonomy expert group, but originally only for more resource-efficient plants with combined heat and power. However, even this value can hardly be met when burning pure natural gas for power generation according to the current state of the art.
A spokesman for the energy supplier Eon told Europe.Table that the limit of 270g is ambitious but achievable if the potential for transforming the gas supply is decisively exploited. Markus Pieper, energy policy spokesman for the CDU/CSU in the EU Parliament, on the other hand, is convinced: “The CO2 limit per kWh is unrealistic from today’s perspective and will scare off investors.” But at least new efficient gas-fired power plants could now be connected to the grid without annual lifetime limits.
The “and” in the last taxonomy draft has now become an “or”, so: Plant operators can choose to comply with the 270g/kWh limit or emit 550 kg of CO2 per year. Admittedly, the figure is averaged over 20 years. Therefore, a gas-fired power plant can emit considerably more in the first year, provided this is compensated for in subsequent years.
Nevertheless, the value is equivalent to a lifetime restriction and finds its origin in the capacity market of the electricity market regulation: The cap on the CO2 intensity of fossil power plants promotes the phase-out of coal, but allows gas at least to temporarily secure the energy supply.
In addition, the draft taxonomy provides for a gradual fuel switch. Accordingly, new power plants can theoretically use pure fossil natural gas at the beginning, provided that the direct limit value or the annual budget is complied with. However, from 2026 onwards, at least 30 percent, from 2030 onwards at least 55 percent, and from 2035 onwards exclusively “low carbon fuels” must be used.
However, it is unclear how these are defined. In its gas package of last December, the EU Commission speaks of a greenhouse gas reduction of 70 percent compared to conventional fossil fuels. Exactly what this means remains open. It also remains unclear whether the reduction target refers to the direct emissions that occur during electricity production or also takes the supply chain into account.
For example, blue hydrogen is basically considered a low-carbon gas. Only water vapor is produced during combustion, and the CO2 generated during production from natural gas is captured and stored using CCS. However, when natural gas is transported, large amounts of methane escape into the air through leakages, and the EU’s methane regulation only addresses infrastructure within Europe. However, more than 80 percent is imported. Open questions like these make the inclusion of natural gas in the taxonomy even more questionable for critics.
Matthias Buck, Director Europe at the think tank Agora Energiewende, also thinks the move is wrong. Classifying fossil gas as “green” does not reduce the risks associated with gas projects in a foreseeable climate-neutral Europe. “But it diminishes the credibility of the taxonomy, which should serve as a science-based reference point for sustainable investments.”
Of course, it would be possible to invest in gas without a taxonomy label, but this would make it more expensive to raise capital and thus energy prices, counters Markus Pieper, the energy policy spokesman for the CDU/CSU in the EU Parliament. If CO2 capture from blue hydrogen makes the transition to green hydrogen easier to finance because the market ramp-up succeeds, “why not classify gas as sustainable?”, says the MEP.
However, criticism of the conflation of different considerations in the legal act also comes from the investor side. “The EU taxonomy is a list of economic activities that are considered sustainable because they are consistent with certain environmental objectives according to scientific criteria,” says Victor van Hoorn, executive director of the European Sustainable Investment Forum (Eurosif), which represents more than 400 organizations. “Unfortunately, various political considerations can undermine the credibility of the taxonomy for investors.”
For the German Association of Natural Gas, Petroleum and Geoenergy (BVEG), on the other hand, the inclusion of natural gas in the taxonomy is the “logical consequence of the realization that considerable investments in gas-fired power plants are required”. Nevertheless, the inclusion of natural gas is not a free pass for future natural gas investments, BVEG managing director Ludwig Möhring tells Europe.Table. “In my opinion, the EU has very clearly covered investments in natural gas infrastructure, and only within narrow limits: namely, where the investments serve climate protection.” This, he says, is about maintaining the security of supply while reducing CO2.
The taxonomy is based on an EU regulation on sustainable financing from 2020, which should determine which activities and products can, in principle, make a significant contribution to achieving the EU climate targets. The paper distinguishes between technologies that make a lasting contribution and those that do so only temporarily. The so-called bridging technologies.
A corresponding expert panel produced a scientific report that did not include nuclear energy or natural gas. This was not originally intended at all, as the taxonomy was only intended to provide guidance for private investors: Which investments are compatible with EU climate and nature conservation goals? From a scientific point of view, fossil natural gas and nuclear energy could not play a role here.
However, when the EU states decided to link the COVID recovery program to climate-friendly conditions, the question arose as to corresponding reference points for green products. More obvious and also pretty much the only available frame of reference: the EU taxonomy. And even though this is not binding in terms of state support, some member states were bothered by the absence of gas and nuclear power, which for many countries represent bridge technologies without alternatives. A science-based list for sustainable private investment turned into a fundamental regulatory debate.
Commission proposal (tbc): 01.26.22
Content: As part of the “Digital Compass” presented by the Commission in March 2021, the Authority intends to define digital rights and principles. The goal is to ensure that the benefits and opportunities of digitalization are available to all EU citizens and that European values are also guaranteed online. The digital rights and principles cover, among other things, the following aspects:
Together with the digital rights and principles, the Commission also intends to present a proposal for an inter-institutional declaration with the European Parliament and the Council. This should represent a European standard for fundamental rights and values in the digital space.
In its proposal, the Commission also wants to take into account the results of a special Eurobarometer survey. According to the survey, 82% of citizens think it would be useful for the EU to define a common European vision for digital rights and principles. 90% of respondents also support the inclusion of the principle that people with disabilities or at risk of exclusion should benefit from accessible and user-friendly digital public services.
Originally, the Commission wanted to present the inter-institutional declaration by the end of 2021. The implementation of the Digital Principles will also be assessed in the “Annual Report on the State of the Digital Decade” (Europe.Table reported).
Commission proposal (tbc): 02.02.22
Content: With this initiative, the Commission aims to address the challenges facing the European standardization system. The Authority wants to ensure that the EU can act more decisively and strategically at international level in this area. The Commission intends to put a focus on the standardization needs that the “Twin Transition” (digitalization and Green Deal) in industrial ecosystems may create or foster.
The strategy also aims to identify ways in which the EU can work with international partners in areas where similar interests are being pursued. One example is cooperation with the US and Canada on how artificial intelligence can be used legally and ethically. The Commission, therefore, intends to examine whether the Regulation on European standardization needs to be revised. A task force consisting of Commission representatives and representatives of the European standards organizations (CEN, CENELEC, ETSI) is to drive forward the implementation of central standards.
Commission proposal (tbc): 02.09.22
Content: EU leaders at the EU summit of February 25th-26th, 2021 had called on the Commission to “present by October 2021 a technology roadmap to boost research, technological development, and innovation and reduce our strategic dependencies in critical technologies and value chains”. The Commission now plans to present the roadmap as part of the defense package in February. It aims to reduce strategic dependencies in a targeted manner in the security and defense sector.
This complements the Chips Act, which, according to current planning, the institution does not want to present before the summer break. This is intended to help Europe achieve more technological sovereignty by establishing a European semiconductor economy (Europe.Table reported).
Core elements: readiness of the European Defence Fund; promotion of synergies between civil, defense and space industries, including artificial intelligence and disruptive technologies; participation of SMEs.
Commission proposal (tbc): 02.09.22
Content: Space traffic management is one of the eleven targeted actions proposed by the Commission in its action plan for synergies between the civil, defense and space industries. Because the number of satellites in space has increased sharply in recent years, partly due to the development of reusable launchers and small satellites, collisions in space are becoming increasingly likely. This can affect space-based systems such as satellite communications.
The strategy should help to avoid collisions and ensure sustainable use of space. At the same time, it should prevent the competitiveness of the space industry in the EU from being affected.
Core elements: technical activities such as EU-SST; regulatory aspects such as standard setting; international cooperation mechanisms
Commission proposal (tbc): 02.09.22
Content: The space-based, global and secure EU communication system also stems from the action plan for synergies between the civil, defense and space industries. The system is intended to provide high-speed transmission in the EU based on quantum encryption and to provide broadband connectivity where it is still lacking. The system will support, among other things, the protection of critical infrastructure, crisis management, and the surveillance of airspace and seas.
For SMEs, according to the Commission, the communication system contains a major economic opportunity, as they can bid for contracts that will drive the expansion of the system. Internal Market Commissioner Thierry Breton wants to move the initiative forward quickly and is counting on the support of the French Council Presidency.
Commission proposal (tbc): 02.23.22
Content: While the Data Governance Act is intended to regulate data exchanges, the Data Act aims at lawful access and use of data. The ultimate goal: to build a fair data economy because the digital economy lacks data in the Commission’s view. This is how innovations are to be driven. Specifically, the Commission wants to use the Data Act to prescribe how companies can make their data usable. The draft law was last scheduled for December 1st, 2021, but fell through the Regulatory Scrutiny Committee due to many open questions (Europe.Table reported).
During the consultation phase, German businesses had also expressed concerns about the draft law. The open questions: When are companies subject to data sharing obligations? How can the interests of data producers and users be taken into account equally? Will there be specific legal acts for individual sectors or exclusively horizontal rules? How does the Data Act relate to other legislative projects that overlap?
In order to ensure that the directive on the legal protection of databases (Database Directive) does not constitute an obstacle to the access and use of data, the Commission intends to revise it within the legislative proposal on the Data Act.
Commission proposal (tbc): 03.02.22
Content: In the EU Strategy for a more effective fight against child sexual abuse (2020), the Commission announced that it would present a new legislative proposal to help combat child sexual abuse online and offline.
According to the agency, child sexual abuse has demonstrably increased due to physical isolation and growing online activity within the COVID-19 pandemic. Online platforms will be required to disclose and report known child sexual abuse material to public authorities. The law is intended to replace the transitional regulation for voluntary disclosure measures by online service providers. It will again be disputed which measures which providers are allowed or obliged to take in order to detect images of child sexual abuse (CSAM) in their access area.
Commission proposal (tbc): 03.16.22
Content: As a “lessons learned” from the COVID-19 pandemic, this new instrument is intended to ensure that the European internal market is better protected against future crises and that, for example, supply chains are not broken again. In addition, the free movement of persons and services should also be guaranteed in the future during crises. As announced in the update of the industrial strategy, the Commission, therefore, wants to revise the rules and instruments of the internal market.
The emergency instrument is intended to help eliminate critical product shortages by speeding up availability. The instrument should also strengthen cooperation in the award of public contracts.
Core elements: transparency obligations; digital solutions for standard setting; accelerated conformity checks; cooperation in public procurement.
Commission proposal (tbc): 03.30.22
Content: As announced in the Circular Economy Action Plan, the Commission intends to propose a directive on sustainable products while revising the 2009 Ecodesign Directive. The proposal was originally scheduled for the end of 2021 (Europe.Table reported). In doing so, the Authority wants to ensure that products within the EU are designed to have a longer lifespan and are easier to reuse, repair, and recycle. They should also contain the highest possible proportion of recycled materials instead of primary raw materials.
Based on the Ecodesign Directive, 31 product groups have already been reviewed and trimmed for energy efficiency. The next step will be smartphones and tablets. The Commission also wants to extend the scope of the Ecodesign Directive beyond energy-using products because other factors such as raw materials and production methods are also relevant to the sustainability of products.
Holger Kunze’s work actually thrives on personal contact with the upper echelons of the EU Commission: The 54-year-old lawyer has been managing director of the Brussels office of Europe’s largest industrial association: the German Engineering Federation VDMA since 2005. But now, he has to maintain his network from home because of the COVID-19 pandemic. “Surprisingly, contact with decision-makers has barely suffered,” says Kunze. “In fact, we are particularly active in talks at the moment.”
Because the interest of mechanical engineering companies in European policy is enormous: Mechanical engineering is directly affected by the green transformation and digitalization. At the same time, the industry has huge potential to shape this transformation: “Our companies produce technologies that are absolutely necessary for the EU to achieve its goals,” says Kunze. “They are the suppliers of all industries and thus make the enormous upheavals possible in the first place.”
But now, of all times, the economic model of the approximately 3,300 VDMA companies is increasingly “falling behind” with the EU Commission, says Kunze. Gone are the days when medium-sized industrial companies with a high export quota were considered a role model in Brussels – and the association’s demands always fell on sympathetic ears with the then Commissioner Günther Oettinger. Today, many regulations are geared towards large companies like Facebook and Google, which are more visible to the public. And not on the numerous “hidden champions” who are world market leaders in a highly specialized niche.
That is why the VDMA is currently seeking intensive talks with the Commission. “We agree on what the EU targets for digitalization and decarbonization address,” says Kunze. He adds that the industry sees the transformation as an opportunity. “That’s why we don’t understand why they’re putting a spoke in our wheel.”
This particularly frustrates Kunze as a “full-blood European”, as he calls himself. Having grown up in Hanover, he became enthusiastic about the European idea during an Erasmus study year in Leuven. He began his professional career in 1998 in the Brussels office of a German law firm. There he dealt with EU competition law and environmental law. “But that was too technical for me,” he says, “I wanted a broader, more political view of EU issues.”
When the VDMA expanded its office in Brussels in 2000, it was Kunze’s chance to get closer to business and politics. He himself is not a mechanic, “But I am fascinated by the business model of these mostly family-run companies. How they conquer the world with innovation.” In 2005, he took over as head of the office. After all these years in Brussels, he says: “Times have never been more exciting.”
He also leads a European life in his private life: He met his wife in Leuven, and he speaks Dutch at home with his two 19- and 22-year-old children. Kunze, who likes to play tennis and take photographs in his spare time, feels rooted in Belgium. He is no longer an EU expat like many others. Adrian Meyer
The EU taxonomy was originally intended as a guide for private investors: Which investments are compatible with the EU’s climate and nature conservation goals? It was not intended that natural gas should be classified as a sustainable energy source. Things turned out differently, and the new taxonomy has become one of the major political issues at present. In his analysis, Timo Landenberger looks back at the genesis of the regulations, sheds light on where the limit values come from, and captures voices from politics and business.
The definition of digital rights and principles in the “Digital Compass”, a strategy for space traffic management, a legislative proposal to fight child sexual abuse more effectively, and much more: There are some new digital policy proposals on the EU Commission’s calendar for the first quarter of this year. Jasmin Kohl knows what exactly the authority is planning and what open questions remain.
Within a few months, the taxonomy was dragged out of its shadowy existence into the political spotlight and discussed more heatedly than almost any other EU topic at present. Initially, the rules were only intended as a guide for private investors, listing which financial transactions are to be classified as sustainable and which are not. Natural gas was not one of them.
The EU Commission appointed a panel of experts to draw up the criteria, which originally envisaged a limit value of 100g CO2 equivalent per kWh of electricity generated for power plants. This can only be achieved with green or blue hydrogen and efficient carbon capture and storage (CCS), not with pure natural gas.
As a result of the political debate, however, the current taxonomy draft now also provides for higher emissions to be permitted, provided a number of criteria are met. Accordingly, plants whose construction permit was issued before December 31st, 2030, can emit up to 270 g/kWh. The value also comes from a recommendation of the Commission’s taxonomy expert group, but originally only for more resource-efficient plants with combined heat and power. However, even this value can hardly be met when burning pure natural gas for power generation according to the current state of the art.
A spokesman for the energy supplier Eon told Europe.Table that the limit of 270g is ambitious but achievable if the potential for transforming the gas supply is decisively exploited. Markus Pieper, energy policy spokesman for the CDU/CSU in the EU Parliament, on the other hand, is convinced: “The CO2 limit per kWh is unrealistic from today’s perspective and will scare off investors.” But at least new efficient gas-fired power plants could now be connected to the grid without annual lifetime limits.
The “and” in the last taxonomy draft has now become an “or”, so: Plant operators can choose to comply with the 270g/kWh limit or emit 550 kg of CO2 per year. Admittedly, the figure is averaged over 20 years. Therefore, a gas-fired power plant can emit considerably more in the first year, provided this is compensated for in subsequent years.
Nevertheless, the value is equivalent to a lifetime restriction and finds its origin in the capacity market of the electricity market regulation: The cap on the CO2 intensity of fossil power plants promotes the phase-out of coal, but allows gas at least to temporarily secure the energy supply.
In addition, the draft taxonomy provides for a gradual fuel switch. Accordingly, new power plants can theoretically use pure fossil natural gas at the beginning, provided that the direct limit value or the annual budget is complied with. However, from 2026 onwards, at least 30 percent, from 2030 onwards at least 55 percent, and from 2035 onwards exclusively “low carbon fuels” must be used.
However, it is unclear how these are defined. In its gas package of last December, the EU Commission speaks of a greenhouse gas reduction of 70 percent compared to conventional fossil fuels. Exactly what this means remains open. It also remains unclear whether the reduction target refers to the direct emissions that occur during electricity production or also takes the supply chain into account.
For example, blue hydrogen is basically considered a low-carbon gas. Only water vapor is produced during combustion, and the CO2 generated during production from natural gas is captured and stored using CCS. However, when natural gas is transported, large amounts of methane escape into the air through leakages, and the EU’s methane regulation only addresses infrastructure within Europe. However, more than 80 percent is imported. Open questions like these make the inclusion of natural gas in the taxonomy even more questionable for critics.
Matthias Buck, Director Europe at the think tank Agora Energiewende, also thinks the move is wrong. Classifying fossil gas as “green” does not reduce the risks associated with gas projects in a foreseeable climate-neutral Europe. “But it diminishes the credibility of the taxonomy, which should serve as a science-based reference point for sustainable investments.”
Of course, it would be possible to invest in gas without a taxonomy label, but this would make it more expensive to raise capital and thus energy prices, counters Markus Pieper, the energy policy spokesman for the CDU/CSU in the EU Parliament. If CO2 capture from blue hydrogen makes the transition to green hydrogen easier to finance because the market ramp-up succeeds, “why not classify gas as sustainable?”, says the MEP.
However, criticism of the conflation of different considerations in the legal act also comes from the investor side. “The EU taxonomy is a list of economic activities that are considered sustainable because they are consistent with certain environmental objectives according to scientific criteria,” says Victor van Hoorn, executive director of the European Sustainable Investment Forum (Eurosif), which represents more than 400 organizations. “Unfortunately, various political considerations can undermine the credibility of the taxonomy for investors.”
For the German Association of Natural Gas, Petroleum and Geoenergy (BVEG), on the other hand, the inclusion of natural gas in the taxonomy is the “logical consequence of the realization that considerable investments in gas-fired power plants are required”. Nevertheless, the inclusion of natural gas is not a free pass for future natural gas investments, BVEG managing director Ludwig Möhring tells Europe.Table. “In my opinion, the EU has very clearly covered investments in natural gas infrastructure, and only within narrow limits: namely, where the investments serve climate protection.” This, he says, is about maintaining the security of supply while reducing CO2.
The taxonomy is based on an EU regulation on sustainable financing from 2020, which should determine which activities and products can, in principle, make a significant contribution to achieving the EU climate targets. The paper distinguishes between technologies that make a lasting contribution and those that do so only temporarily. The so-called bridging technologies.
A corresponding expert panel produced a scientific report that did not include nuclear energy or natural gas. This was not originally intended at all, as the taxonomy was only intended to provide guidance for private investors: Which investments are compatible with EU climate and nature conservation goals? From a scientific point of view, fossil natural gas and nuclear energy could not play a role here.
However, when the EU states decided to link the COVID recovery program to climate-friendly conditions, the question arose as to corresponding reference points for green products. More obvious and also pretty much the only available frame of reference: the EU taxonomy. And even though this is not binding in terms of state support, some member states were bothered by the absence of gas and nuclear power, which for many countries represent bridge technologies without alternatives. A science-based list for sustainable private investment turned into a fundamental regulatory debate.
Commission proposal (tbc): 01.26.22
Content: As part of the “Digital Compass” presented by the Commission in March 2021, the Authority intends to define digital rights and principles. The goal is to ensure that the benefits and opportunities of digitalization are available to all EU citizens and that European values are also guaranteed online. The digital rights and principles cover, among other things, the following aspects:
Together with the digital rights and principles, the Commission also intends to present a proposal for an inter-institutional declaration with the European Parliament and the Council. This should represent a European standard for fundamental rights and values in the digital space.
In its proposal, the Commission also wants to take into account the results of a special Eurobarometer survey. According to the survey, 82% of citizens think it would be useful for the EU to define a common European vision for digital rights and principles. 90% of respondents also support the inclusion of the principle that people with disabilities or at risk of exclusion should benefit from accessible and user-friendly digital public services.
Originally, the Commission wanted to present the inter-institutional declaration by the end of 2021. The implementation of the Digital Principles will also be assessed in the “Annual Report on the State of the Digital Decade” (Europe.Table reported).
Commission proposal (tbc): 02.02.22
Content: With this initiative, the Commission aims to address the challenges facing the European standardization system. The Authority wants to ensure that the EU can act more decisively and strategically at international level in this area. The Commission intends to put a focus on the standardization needs that the “Twin Transition” (digitalization and Green Deal) in industrial ecosystems may create or foster.
The strategy also aims to identify ways in which the EU can work with international partners in areas where similar interests are being pursued. One example is cooperation with the US and Canada on how artificial intelligence can be used legally and ethically. The Commission, therefore, intends to examine whether the Regulation on European standardization needs to be revised. A task force consisting of Commission representatives and representatives of the European standards organizations (CEN, CENELEC, ETSI) is to drive forward the implementation of central standards.
Commission proposal (tbc): 02.09.22
Content: EU leaders at the EU summit of February 25th-26th, 2021 had called on the Commission to “present by October 2021 a technology roadmap to boost research, technological development, and innovation and reduce our strategic dependencies in critical technologies and value chains”. The Commission now plans to present the roadmap as part of the defense package in February. It aims to reduce strategic dependencies in a targeted manner in the security and defense sector.
This complements the Chips Act, which, according to current planning, the institution does not want to present before the summer break. This is intended to help Europe achieve more technological sovereignty by establishing a European semiconductor economy (Europe.Table reported).
Core elements: readiness of the European Defence Fund; promotion of synergies between civil, defense and space industries, including artificial intelligence and disruptive technologies; participation of SMEs.
Commission proposal (tbc): 02.09.22
Content: Space traffic management is one of the eleven targeted actions proposed by the Commission in its action plan for synergies between the civil, defense and space industries. Because the number of satellites in space has increased sharply in recent years, partly due to the development of reusable launchers and small satellites, collisions in space are becoming increasingly likely. This can affect space-based systems such as satellite communications.
The strategy should help to avoid collisions and ensure sustainable use of space. At the same time, it should prevent the competitiveness of the space industry in the EU from being affected.
Core elements: technical activities such as EU-SST; regulatory aspects such as standard setting; international cooperation mechanisms
Commission proposal (tbc): 02.09.22
Content: The space-based, global and secure EU communication system also stems from the action plan for synergies between the civil, defense and space industries. The system is intended to provide high-speed transmission in the EU based on quantum encryption and to provide broadband connectivity where it is still lacking. The system will support, among other things, the protection of critical infrastructure, crisis management, and the surveillance of airspace and seas.
For SMEs, according to the Commission, the communication system contains a major economic opportunity, as they can bid for contracts that will drive the expansion of the system. Internal Market Commissioner Thierry Breton wants to move the initiative forward quickly and is counting on the support of the French Council Presidency.
Commission proposal (tbc): 02.23.22
Content: While the Data Governance Act is intended to regulate data exchanges, the Data Act aims at lawful access and use of data. The ultimate goal: to build a fair data economy because the digital economy lacks data in the Commission’s view. This is how innovations are to be driven. Specifically, the Commission wants to use the Data Act to prescribe how companies can make their data usable. The draft law was last scheduled for December 1st, 2021, but fell through the Regulatory Scrutiny Committee due to many open questions (Europe.Table reported).
During the consultation phase, German businesses had also expressed concerns about the draft law. The open questions: When are companies subject to data sharing obligations? How can the interests of data producers and users be taken into account equally? Will there be specific legal acts for individual sectors or exclusively horizontal rules? How does the Data Act relate to other legislative projects that overlap?
In order to ensure that the directive on the legal protection of databases (Database Directive) does not constitute an obstacle to the access and use of data, the Commission intends to revise it within the legislative proposal on the Data Act.
Commission proposal (tbc): 03.02.22
Content: In the EU Strategy for a more effective fight against child sexual abuse (2020), the Commission announced that it would present a new legislative proposal to help combat child sexual abuse online and offline.
According to the agency, child sexual abuse has demonstrably increased due to physical isolation and growing online activity within the COVID-19 pandemic. Online platforms will be required to disclose and report known child sexual abuse material to public authorities. The law is intended to replace the transitional regulation for voluntary disclosure measures by online service providers. It will again be disputed which measures which providers are allowed or obliged to take in order to detect images of child sexual abuse (CSAM) in their access area.
Commission proposal (tbc): 03.16.22
Content: As a “lessons learned” from the COVID-19 pandemic, this new instrument is intended to ensure that the European internal market is better protected against future crises and that, for example, supply chains are not broken again. In addition, the free movement of persons and services should also be guaranteed in the future during crises. As announced in the update of the industrial strategy, the Commission, therefore, wants to revise the rules and instruments of the internal market.
The emergency instrument is intended to help eliminate critical product shortages by speeding up availability. The instrument should also strengthen cooperation in the award of public contracts.
Core elements: transparency obligations; digital solutions for standard setting; accelerated conformity checks; cooperation in public procurement.
Commission proposal (tbc): 03.30.22
Content: As announced in the Circular Economy Action Plan, the Commission intends to propose a directive on sustainable products while revising the 2009 Ecodesign Directive. The proposal was originally scheduled for the end of 2021 (Europe.Table reported). In doing so, the Authority wants to ensure that products within the EU are designed to have a longer lifespan and are easier to reuse, repair, and recycle. They should also contain the highest possible proportion of recycled materials instead of primary raw materials.
Based on the Ecodesign Directive, 31 product groups have already been reviewed and trimmed for energy efficiency. The next step will be smartphones and tablets. The Commission also wants to extend the scope of the Ecodesign Directive beyond energy-using products because other factors such as raw materials and production methods are also relevant to the sustainability of products.
Holger Kunze’s work actually thrives on personal contact with the upper echelons of the EU Commission: The 54-year-old lawyer has been managing director of the Brussels office of Europe’s largest industrial association: the German Engineering Federation VDMA since 2005. But now, he has to maintain his network from home because of the COVID-19 pandemic. “Surprisingly, contact with decision-makers has barely suffered,” says Kunze. “In fact, we are particularly active in talks at the moment.”
Because the interest of mechanical engineering companies in European policy is enormous: Mechanical engineering is directly affected by the green transformation and digitalization. At the same time, the industry has huge potential to shape this transformation: “Our companies produce technologies that are absolutely necessary for the EU to achieve its goals,” says Kunze. “They are the suppliers of all industries and thus make the enormous upheavals possible in the first place.”
But now, of all times, the economic model of the approximately 3,300 VDMA companies is increasingly “falling behind” with the EU Commission, says Kunze. Gone are the days when medium-sized industrial companies with a high export quota were considered a role model in Brussels – and the association’s demands always fell on sympathetic ears with the then Commissioner Günther Oettinger. Today, many regulations are geared towards large companies like Facebook and Google, which are more visible to the public. And not on the numerous “hidden champions” who are world market leaders in a highly specialized niche.
That is why the VDMA is currently seeking intensive talks with the Commission. “We agree on what the EU targets for digitalization and decarbonization address,” says Kunze. He adds that the industry sees the transformation as an opportunity. “That’s why we don’t understand why they’re putting a spoke in our wheel.”
This particularly frustrates Kunze as a “full-blood European”, as he calls himself. Having grown up in Hanover, he became enthusiastic about the European idea during an Erasmus study year in Leuven. He began his professional career in 1998 in the Brussels office of a German law firm. There he dealt with EU competition law and environmental law. “But that was too technical for me,” he says, “I wanted a broader, more political view of EU issues.”
When the VDMA expanded its office in Brussels in 2000, it was Kunze’s chance to get closer to business and politics. He himself is not a mechanic, “But I am fascinated by the business model of these mostly family-run companies. How they conquer the world with innovation.” In 2005, he took over as head of the office. After all these years in Brussels, he says: “Times have never been more exciting.”
He also leads a European life in his private life: He met his wife in Leuven, and he speaks Dutch at home with his two 19- and 22-year-old children. Kunze, who likes to play tennis and take photographs in his spare time, feels rooted in Belgium. He is no longer an EU expat like many others. Adrian Meyer
