Table.Briefing: Europe

US data transfer agreement: Biden delivers + Member states clash over gas price brake

  • US data transfer agreement: Substantial improvement or just cosmetics?
  • Member states hopelessly at odds over energy price brake
  • JURI Committee submits opinion on Chips Act
  • BSI president tumbles over lack of distance to Russia
  • Crisis aid rules to apply until end of 2023
  • Additionality: Hydrogen association makes demands of EU policymakers
  • EU states to train 15,000 Ukrainian soldiers
  • Michael Hager: The most important German official in the EU Commission
Dear reader,

US President Joe Biden took his time. Now, at last, he has signed the presidential orders. Based on these orders a new attempt can be made for a recognition decision by the EU to be allowed to transfer data from the EU to the USA. The EU Commission and the US government are optimistic that the new regulation would still hold up after a review by the ECJ. Data protectionists, on the other hand, are skeptical, believing that it could end up being old wine in new bottles. My colleague Falk Steiner knows the details.

Meetings of heads of state and government can be challenging, and progress toward consensus is often barely measurable. At the informal summit in Prague, the 27 countries did not even come close to a solution that would tackle the drastic price increases for gas and electricity for consumers and companies. However, on the second day in Prague, the neighboring countries were very critical of Germany’s unilateral approach. My colleague Ella Joyner observed on the spot what Olaf Scholz experienced with his “double boom.”

The commissioners of the 27 member states are in the front row of operational EU policy. Just behind them, but working more in the background, are their cabinet heads. They are policy managers, negotiators, and sought-after contacts for lobbyists and other stakeholders. Perhaps the most important German official is Michael Hager, Head of Cabinet for Vice Commission President Dombrovskis. I wrote his Profile.

Your
Markus Grabitz
Image of Markus  Grabitz

Feature

US data transfer agreement: Substantial improvement or just cosmetics?

“An important step forward for better data protection for citizens and more legal certainty for businesses – on both sides of the Atlantic,” rejoices Commission President Ursula von der Leyen demonstratively. She had politically agreed on the new regulation with US President Joe Biden more than half a year ago. Since then, the White House has been busy drafting executive orders that guarantee a level of protection for EU personal data in the United States that is comparable to the EU framework.

US services to sniff data sparingly

Key points of the presidential orders concern the regulations on Signals Intelligent (SIGINT), as intelligence data collection via satellites, cables, or other means is known. In the future, US authorities are to be bound more closely to the principle of proportionality even when collecting data from non-US citizens. In doing so, they are to pay greater attention to the right to privacy and they are to be under better control in this regard. The principle of data economy, which is well established in Europe, is also to be strengthened for data that has already been stored.

In doing so, the US side would be taking steps toward the European Court of Justice (ECJ). The skeptical judges in Luxembourg already found two attempts insufficient. Within a year, the heads of the respective US services must now adapt their internal regulations to the new presidential guidelines. However, it remains to be seen whether these approximations in wording actually mean what the EU side’s interpretation of them is, especially by the judges in Luxembourg.

US Commerce Secretary Gina Raimondo is confident that there would now be a “durable and reliable legal basis for trans-Atlantic data flows.” But it is not only notorious critics who consider precisely that to be questionable. The presidential executive orders are welcomed as a way to finally move forward on the perennial issue. “After the executive order, the political will for a solution must be quickly translated into a robust legal regulation that can withstand future judicial review,” says Susanne Dehmel of Bitkom.

Dual chamber system to enable verification

The US Department of Justice (DoJ) has already taken the first step in this direction. Biden’s presidential orders stipulate, among other things, that a court-like institution should deal with data protection complaints by foreign citizens against the US intelligence services. The DoJ has already initiated the establishment of a corresponding “Data Protection Review Court” as the second chamber of the complaint mechanism. The first chamber was established at the National Director of Intelligence (ODNI) in the course of the Privacy Shield agreement in 2015. It is now to perform its duties in an adapted manner. The lack of effective legal remedies was another major reason for the ECJ to find the predecessor agreements inadequate.

Many critics nevertheless consider the chosen path inadequate: Instead of changing the substantive US intelligence law so that non-US citizens are better protected from the outset, many legal improvements have been made with the president’s executive orders. But these are exceptions to the rule. They can be changed at any time by the current or future presidents. The main reason for the chosen path was that it made it possible to act relatively quickly and without the politically delicate process of making real changes to the law.

TADPF becomes EUUSDPF

In the future, the agreement will no longer be called the Transatlantic Data Privacy Framework, as announced in the spring, but the EU-US Data Privacy Framework. There is a lot at stake: Data is essential for a trade and investment volume of €1 trillion, says US Secretary of Commerce Gina Raimondo, outlining the order of magnitude. The White House talks about a volume of €7.1 trillion in transatlantic relations.

Even if Google, Microsoft, Amazon, Meta, Apple, and other tech companies are the main focus, the significance goes far beyond that. Every company that wants to have personal data from the EU processed in the USA needs a legal basis.

Commission must initiate recognition

In the further process, the EU Commission must now make its own assessment of the US proposals: the so-called adequacy decision, which examines whether the assurances meet the requirements of the Schrems II ruling and whether the US achieves a comparable level of data protection. Subsequently, the data protection supervisory authorities, Parliament, and member states will deal with the Commission’s proposal. If not stopped in the further course of the debate, it could enter into force. It is unclear how quickly this process will be completed; in Commission circles, there is talk of several weeks before the adequacy decision could be presented.

Industry calls for restraint from data protectionists

The Internet industry association Eco is calling for restraint on the part of the supervisory authorities until the adequacy decision is reached: “Until then, the data protection authorities should take a clear position, recognize the present solution, and absolutely refrain from fine proceedings or any transfer bans at the companies until it comes into force,” says Eco board member Oliver Süme.

But this can hardly be expected: It would mean that the data protection supervisory authorities would ignore applicable law.

Critics also see key issues still unresolved: “Without details on how the presidential order will be implemented, it means something like ‘We take your privacy seriously on a company website,” criticizes Calli Schroeder of the US organization EPIC, Co-Chair of the Digital Division of the transatlantic consumer dialogue TACD.

In ‘t Veld: Presidential decree is ‘pig with lipstick’

“This one needs to stick,” says Eva Maydell, EPP MEP from Bulgaria. Sophie in ‘t Veld is clearly disgruntled. The Dutch liberal expects that the European Court of Justice will have to rule on “Schrems III” relatively quickly: “US and EUCommission apparently still haven’t learned that putting lipstick on the Privacy-Shield-pig will not fool the CJEU,” the D66 politician vented her anger on Twitter.

Max Schrems is already considering whether the US bill will prompt him to go to Luxembourg for a third time after Safe Harbor and Privacy Shield. In a first reaction he criticizes: “The EU and the US now agree on use of the word ‘proportionate’ but seem to disagree on the meaning of it”, he already sees a first, important point of attack for a possible court case against an EU adequacy decision. His prediction: “In the end, the CJEU’s definition will prevail – likely killing any EU decision again.”

  • Data
  • Data protection
  • Digital policy
  • Digitization

Member states hopelessly at odds over brake on energy prices

The cooler the weather, the more heated the debate about a joint European response to the energy price crisis. By the time of the regular European Council in the middle of next week at the latest, the member states must find a way to protect consumers and companies from grossly inflated energy prices. An informal summit like the one in Prague on Friday does not have to deliver decisions in text form, but it does have to hint at the direction the EU wants to take – that would have been good.

The 27 countries will soon have opportunities to settle their dispute. On Tuesday and Wednesday, the energy ministers will meet informally in Prague. Nine days later, the regular fall summit in Brussels will take place. The Commission is expected to present its proposal in advance. With sufficient advance notice so that it can be examined by the experts.

Debate has been going on for weeks

Officials in Brussels have already had a chance to hear the capitals’ differing opinions. The debate has been going on for weeks. But the tone has become harsher. The German government also bears responsibility. With his double boom, which was not coordinated in Europe, Chancellor Olaf Scholz had done exactly the opposite of what he had always urged other member states to do in the Ukraine crisis: a joint approach.

Poland, Latvia and Luxembourg were the most vocal in their criticism of Germany going it alone. Poland’s Prime Minister Mateusz Morawiecki said that “German egoism” should finally be put in a drawer. He said he was resolutely against the destruction of the European single market. “The richest EU state with a strong economy is trying to use the crisis to get a competitive advantage for its businesses. That’s not fair.” He said many countries at the summit pointed out, that this was the wrong way to go. The day before, Morawiecki had already warned against “Germany’s dictate” in European energy policy.

The criticism is fierce: Berlin is subsidizing gas, thus fueling consumption and giving its companies an unfair advantage. On the other hand, Germany is blocking all attempts by others to impose an EU-wide energy price cap.

Scholz stands by double boom

Scholz defended the “double boom.” All states had to help their citizens through the crisis. Other member states were doing the same. He received support from Mark Rutte from the Netherlands, who also rejects the EU-wide gas price cap.

Without naming Berlin, however, Commission President Ursula von der Leyen warned at the summit against “fragmentation and distortion” of the single market. Protecting the common market is of the utmost importance, she said.

The debate on a price cap is not made any easier by the fact that there are such conflicting views. The less radical option would be subsidization from EU funds. But that would be enormously expensive. The more radical option would be to cap the price of natural gas imported into the EU. However, this would be dangerous: Suppliers could then steer clear of the EU in the future. Berlin is thus not convinced.

The Commission is also skeptical and attaches specific conditions to the introduction of a gas price cap: higher, mandatory gas savings and mandatory solidarity agreements.

Many attempts expected

The Commission is pursuing three strands: explore how to dampen prices in the gas market, and negotiate a corridor for reasonable prices with reliable suppliers. And: try to limit the influence of the gas price on electricity pricing.

Four member states (Italy, Poland, Greece and Belgium) are reported to have submitted a paper proposing a three-step procedure to address the Commission’s concerns.

As unsatisfactory as the situation is after the meeting in Prague, one forecast is possible: In the coming days, there will be a whole series of attempts from member states to forge a compromise. In Brussels jargon, these trial balloons are also called “non-papers.” The stakes are high: The measures are intended to help avoid energy emergencies. Heated questions need to be answered, now that it has already become much cooler in Brussels.

  • Energy
  • Energy policy
  • European Council
  • European policy
  • Fossil fuels
  • Natural gas

News

JURI Committee submits opinion on Chips Act

With the Chips Act, the EU intends to create a strong European semiconductor ecosystem and secure Europe’s technological sovereignty in the future. JURI rapporteur Tiemo Wölken (S&D) proposes a new technological path to achieve this, in his opinion for the Legal Affairs Committee: Europe should promote open source to create a foundation on which the economy could build. It involves transferring the known open-source concept from software to hardware. This is according to the JURI opinion, which is available to Europe.Table, and will be published in the coming days. Most of the proposed amendments relate to Article 4 of the Commission proposal.

The JURI Committee’s amendments have two objectives:

  • Strengthen the role of open-source in intellectual property (IP) in the semiconductor sector. In doing so, promoting this fundamental technology should lead to its adoption and further development by key industries.
  • Provide legal clarity on the treatment of confidential information and IP – especially towards untrusted third countries. At the same time, keep the door open for trusted partners explicitly.

Open source instead of proprietary technologies

Currently, European companies pay high licensing fees for proprietary semiconductor technologies and tools, which is a barrier to market entry, especially for SMEs. Wölken is convinced that open-source IP will lower these barriers while reducing Europe’s dependence on proprietary intellectual property from outside the EU.

In addition, the JURI committee fears that the Commission’s proposal will lead to legal uncertainty because it does not contain sufficient protection of confidential information and intellectual property. Intellectual property theft, industrial espionage, or the violation of confidentiality agreements are not only economic problems for the companies concerned. These practices could also harm European defense interests and national security.

To build an open-source chip ecosystem, Wölken suggests:

  • prioritizing funding of open-source reference designs (such as RISC-V) and standards
  • developing and deploying open-source development tools (including EDA and CAD)
  • promoting the use of open-source IP in vertical sectors such as automotive, manufacturing, and healthcare.

Rapporteur Dan Nica (S&D, Romania) on the lead ITRE Committee already submitted his draft report on the Chips Act in September. The ITRE Committee will deal with the issue at its meeting on October 13. Wölken’s opinion will be discussed in the JURI Committee on October 26. vis

  • Chips
  • Chips Act
  • Chips Act
  • European Defense

BSI President tumbles over lack of distance to Russia

All options are being examined,” the spokesman for German Home Secretary Nancy Faeser (SPD) confirmed again this late Sunday evening: Arne Schönbohm, head of the largest cybersecurity agency in Europe, must fear being recalled due to a ZDF report. He is accused of lacking distance from Russian intelligence circles.

The matter is also observed with interest in other European countries: The German Federal Office for Information Security (BSI) is the best-equipped civilian cybersecurity agency in the EU – and its structural separation from intelligence services means it is also a welcome partner in other countries. In addition, the BSI is part of the European IT security structure and is practically responsible for enforcing large amounts of the NIS directive.

Schönbohm had come under criticism following a report by ZDF Magazin Royal: Before becoming BSI President, Schönbohm had co-founded the association Cyber-Sicherheitsrat Deutschland e. V. in 2012 and served as its president. Among well-known commercial enterprises, the German Federal Ministry of Health and the German Aerospace Center, a company now called Protelion, that offers cybersecurity products is also a member. In fact, however, it is the German subsidiary of Infotecs (ИнфоТеКС), which was founded in Russian intelligence circles.

Schönbohm maintained close contacts with the so-called Cyber Security Council until the very end and gave the ceremonial speech on the occasion of the tenth anniversary of the association he co-founded – and according to Business Insider, he did so with the permission of State Secretary Markus Richter, who was also installed under Union Home Secretary. Schönbohm must have been aware of the problem. His successor as chairman of the association, Hans-Wilhelm Dünn, had already become the subject of critical reporting in 2019 because of his lack of distance from Russia, in the context of which Schönbohm prohibited his own employees from contact with the association until the allegations had been clarified.

Schönbohm had come to office under CDU Home Secretary Thomas de Maizière in 2016, despite vocal criticism from civil society and the opposition at the time. De Maizière found the son of former Brandenburg CDU Home Secretary Jörg Schönbohm suitable to head the cybersecurity agency, whose origins lie in the BND’s cipher department. fst

  • Cybersecurity
  • Digital policy
  • Digitization
  • Germany

Crisis aid rules to apply until end of 2023

The Commission wants to extend the crisis aid rules by a year. This is according to the proposal sent by the Commission to the member states last week and quoted by the French specialized information service Contexte. State aid exemptions are to be extended for a year. They allow member states to help companies with the sharp rise in energy prices resulting from Russia’s war of aggression on Ukraine.

Accordingly, they are now to apply for a limited period until December 31, 2023. As Contexte further reports, there will be no change to the maximum amounts up to which member states can relieve companies of gas and electricity prices. However, the limits are to be calculated for the calendar year. Individual industrial companies can receive support from the state of up to €2 million a year.

Particularly energy-intensive companies will even be able to receive up to €50 million a year. In the future, heating and cooling bills can also be included to determine the higher expenditure. The Commission also plans to allow subsidies that promote electricity saving. Member states now have a few days to request changes. After that, the proposal will be published. mgr

  • EU
  • European Commission

Additionality: Hydrogen umbrella organization formulates demands on EU policymakers

The hydrogen umbrella organization Hydrogen Europe formulated criteria that the Delegated Act on Additionality in relation to green hydrogen must meet from its point of view. Hydrogen Europe’s letter to EU Commission President Ursula von der Leyen and RED-3 rapporteur Markus Pieper (CDU), available to Europe Table, calls for:

  • a transition phase until 2028 when phasing in additionality. Only in this way can the long approval procedures be taken into account, they say
  • ten-year grandfathering for early investors following the transition phase. First movers would then only have to comply with the additionality rules in the second half of their production cycle
  • monthly correlation for all market participants. Monthly correlation should also be possible for projects that do not receive public funds. Coverage on a daily and hourly basis should be done later on
  • Geographic correlation: Member states should receive flexibility in bidding zones. Electrolyzers do not have to be located in the bidding zone where the green electricity is generated; they should also be allowed to be located in a neighboring bidding zone. 

The subject of the EU legal text on additionality is to define under which conditions the energy carrier hydrogen can be classified as “renewable.” In its letter, Hydrogen Europe urges the EU to increase the legislation pace significantly. It is of paramount importance, it says, to immediately remove the political uncertainty surrounding renewable hydrogen. Otherwise, Europe risks losing its leading role in building a hydrogen industry, he said. “The renewable hydrogen industry cannot afford to wait another three months to have production rules.” The authors warn, that a patchwork of national rules, as member states implement RED 3, would complicate trade in the internal market and paralyze investment. mgr

  • EU
  • European Commission

EU states to train 15,000 Ukrainian soldiers

The EU states want to train around 15,000 Ukrainian soldiers. According to EU sources, the Political and Security Committee (PSC) reached an agreement to this effect. The PSC brings together the ambassadors of the EU states under the chairmanship of the EU’s External Action Service. The decision still needs to be formally confirmed by EU countries.

Czech Prime Minister Petr Fiala said after an informal EU summit on Friday that he welcomed an agreement on a training mission for Ukrainian troops, but did not give a specific figure. As reported by “Welt am Sonntag” and “Spiegel,” Germany and Poland, among others, are to train the Ukrainian soldiers. Training courses are also planned in other EU countries, they said. dpa

  • European policy
  • Geopolitics
  • Poland

Heads

Michael Hager: The most important German official in the EU Commission

Michael Hager heads the cabinet of the Vice President of the Commission, Valdis Dombrovskis.

If there were a ranking for the most important German civil servant in the EU bubble, Michael Hager would be right at the top. No one has a more profound knowledge of the laws by which the Commission’s civil service functions. No one carries more experience from the innermost circle of power, the college of 27 commissioners. Of all the Berlaymont cabinet heads, he has been in office the longest. 

The younger-looking 55-year-old has headed the cabinet of the Commission’s Senior Vice President, Valdis Dombrovskis, since 2019. Before that, he held the same position in the cabinet of the German Commissioner, Günther H. Oettinger, since 2013. Hager, whose daughters were very young back then, was Oettinger’s closest aide. That must have been particularly exhausting.

Oettinger’s stamina late at night well after the usual closing time for top EU officials is notorious. As Oettinger’s Chief Negotiator, Hager got deep insight into the many issues Oettinger was responsible for: energy, digital topics. Most recently, he had to take care of the Commission’s staff and help negotiate the EU’s Multiannual Financial Framework (MFF).

Contact for German economy

Even under Oettinger, Hager was a sought-after interlocutor for German interests on the EU stage. Oettinger was always approachable to business people, both as Prime Minister and Commissioner. Since the new mandate, Hager’s importance has grown once again. Normally, the German Commissioner’s Head of Cabinet is the most important interlocutor for representatives of companies and associations from Germany.

In the Commission, which started in 2019, this would actually be the task of Björn Seibert, who heads Ursula von der Leyen’s cabinet. But since von der Leyen, as President of the Commission, does not want to be seen in the role of a German commissioner but instead has a pan-European appearance, Seibert drops out. Hager has to cover that.

Hager goes to the Berlaymont every Sunday to prepare for the weekly “Hebdo” meeting, the round of cabinet heads on Monday where the stakes are hammered in for the Commission meeting. Hager has a monster repertoire. His boss, Latvian Dombrovskis, is responsible for all crucial economic policy decisions from the euro to the reconstruction fund.

Responsible for economy, currency and trade

Since Irish Trade Commissioner Phil Hogan was forced to resign for violating Covid rules, Dombrovskis, and thus Hager, has also been responsible for EU trade policy. He does all this while maintaining an extreme calm, with humor, and without ever letting the interlocutor feel his own importance.

Over the years, Hager, born in the Bavarian part of Swabia, has become an EU official who negotiates his dossiers in perfect French and English. In terms of his studies, this EU career comes as quite a surprise: He studied politics and sinology in Tübingen and spent an extended period in Asia

In the EU business, Germans sometimes tend to hide their Germanness in shame. Hager does not deny his German origins. He shows up in the evenings at events primarily in the German states’ representative offices, co-governed by the CDU/CSU. Hager is active on the board of the Brussels CDU, the party’s only local chapter abroad. That’s where the circle closes. Each of the Commission’s senior vice presidential posts went to a representative of the European party families. Hager’s boss Dombrovskis belongs to the Christian Democratic EPP.

String puller on the staff carousel

Hager is a member of two informal Union-related networks in Brussels. One is the “Genval” round table, named after a lake outside Brussels. Two or three times a year, high-ranking officials close to the Union from Brussels and Berlin meet there with utmost confidence. He is also a member of a network founded in the 1970s when the CDU/CSU lost power in the federal government and was cut off from the flow of important news from the EU: the Aktionsgemeinschaft der CDU/CSU-nahen Beamten in Brüssel. It is headed by Markus Schulte, also a former member of Oettinger’s cabinet.

The club sees itself more as a service provider. When officials from Germany come to Brussels, they find expertise here. Careerists are out of place, says one who has been involved for a long time. The FDP and Social Democrats also have their own networks in the institutions. But none of them is as successful as the Union’s. When the commissioners were filled after the European elections, a conspicuously large number of Germans with a Union background ended up in the good posts. Representatives of the SPD and FDP tend to be found in the Commission’s engine room. Is Hager still involved today when jobs are passed out to Germans in Brussels? He probably no longer has the time, given the workload in Dombrovskis’ cabinet. Markus Grabitz

  • EU
  • European Commission

Europe.Table Editorial Office

EUROPE.TABLE EDITORS

Licenses:
    • US data transfer agreement: Substantial improvement or just cosmetics?
    • Member states hopelessly at odds over energy price brake
    • JURI Committee submits opinion on Chips Act
    • BSI president tumbles over lack of distance to Russia
    • Crisis aid rules to apply until end of 2023
    • Additionality: Hydrogen association makes demands of EU policymakers
    • EU states to train 15,000 Ukrainian soldiers
    • Michael Hager: The most important German official in the EU Commission
    Dear reader,

    US President Joe Biden took his time. Now, at last, he has signed the presidential orders. Based on these orders a new attempt can be made for a recognition decision by the EU to be allowed to transfer data from the EU to the USA. The EU Commission and the US government are optimistic that the new regulation would still hold up after a review by the ECJ. Data protectionists, on the other hand, are skeptical, believing that it could end up being old wine in new bottles. My colleague Falk Steiner knows the details.

    Meetings of heads of state and government can be challenging, and progress toward consensus is often barely measurable. At the informal summit in Prague, the 27 countries did not even come close to a solution that would tackle the drastic price increases for gas and electricity for consumers and companies. However, on the second day in Prague, the neighboring countries were very critical of Germany’s unilateral approach. My colleague Ella Joyner observed on the spot what Olaf Scholz experienced with his “double boom.”

    The commissioners of the 27 member states are in the front row of operational EU policy. Just behind them, but working more in the background, are their cabinet heads. They are policy managers, negotiators, and sought-after contacts for lobbyists and other stakeholders. Perhaps the most important German official is Michael Hager, Head of Cabinet for Vice Commission President Dombrovskis. I wrote his Profile.

    Your
    Markus Grabitz
    Image of Markus  Grabitz

    Feature

    US data transfer agreement: Substantial improvement or just cosmetics?

    “An important step forward for better data protection for citizens and more legal certainty for businesses – on both sides of the Atlantic,” rejoices Commission President Ursula von der Leyen demonstratively. She had politically agreed on the new regulation with US President Joe Biden more than half a year ago. Since then, the White House has been busy drafting executive orders that guarantee a level of protection for EU personal data in the United States that is comparable to the EU framework.

    US services to sniff data sparingly

    Key points of the presidential orders concern the regulations on Signals Intelligent (SIGINT), as intelligence data collection via satellites, cables, or other means is known. In the future, US authorities are to be bound more closely to the principle of proportionality even when collecting data from non-US citizens. In doing so, they are to pay greater attention to the right to privacy and they are to be under better control in this regard. The principle of data economy, which is well established in Europe, is also to be strengthened for data that has already been stored.

    In doing so, the US side would be taking steps toward the European Court of Justice (ECJ). The skeptical judges in Luxembourg already found two attempts insufficient. Within a year, the heads of the respective US services must now adapt their internal regulations to the new presidential guidelines. However, it remains to be seen whether these approximations in wording actually mean what the EU side’s interpretation of them is, especially by the judges in Luxembourg.

    US Commerce Secretary Gina Raimondo is confident that there would now be a “durable and reliable legal basis for trans-Atlantic data flows.” But it is not only notorious critics who consider precisely that to be questionable. The presidential executive orders are welcomed as a way to finally move forward on the perennial issue. “After the executive order, the political will for a solution must be quickly translated into a robust legal regulation that can withstand future judicial review,” says Susanne Dehmel of Bitkom.

    Dual chamber system to enable verification

    The US Department of Justice (DoJ) has already taken the first step in this direction. Biden’s presidential orders stipulate, among other things, that a court-like institution should deal with data protection complaints by foreign citizens against the US intelligence services. The DoJ has already initiated the establishment of a corresponding “Data Protection Review Court” as the second chamber of the complaint mechanism. The first chamber was established at the National Director of Intelligence (ODNI) in the course of the Privacy Shield agreement in 2015. It is now to perform its duties in an adapted manner. The lack of effective legal remedies was another major reason for the ECJ to find the predecessor agreements inadequate.

    Many critics nevertheless consider the chosen path inadequate: Instead of changing the substantive US intelligence law so that non-US citizens are better protected from the outset, many legal improvements have been made with the president’s executive orders. But these are exceptions to the rule. They can be changed at any time by the current or future presidents. The main reason for the chosen path was that it made it possible to act relatively quickly and without the politically delicate process of making real changes to the law.

    TADPF becomes EUUSDPF

    In the future, the agreement will no longer be called the Transatlantic Data Privacy Framework, as announced in the spring, but the EU-US Data Privacy Framework. There is a lot at stake: Data is essential for a trade and investment volume of €1 trillion, says US Secretary of Commerce Gina Raimondo, outlining the order of magnitude. The White House talks about a volume of €7.1 trillion in transatlantic relations.

    Even if Google, Microsoft, Amazon, Meta, Apple, and other tech companies are the main focus, the significance goes far beyond that. Every company that wants to have personal data from the EU processed in the USA needs a legal basis.

    Commission must initiate recognition

    In the further process, the EU Commission must now make its own assessment of the US proposals: the so-called adequacy decision, which examines whether the assurances meet the requirements of the Schrems II ruling and whether the US achieves a comparable level of data protection. Subsequently, the data protection supervisory authorities, Parliament, and member states will deal with the Commission’s proposal. If not stopped in the further course of the debate, it could enter into force. It is unclear how quickly this process will be completed; in Commission circles, there is talk of several weeks before the adequacy decision could be presented.

    Industry calls for restraint from data protectionists

    The Internet industry association Eco is calling for restraint on the part of the supervisory authorities until the adequacy decision is reached: “Until then, the data protection authorities should take a clear position, recognize the present solution, and absolutely refrain from fine proceedings or any transfer bans at the companies until it comes into force,” says Eco board member Oliver Süme.

    But this can hardly be expected: It would mean that the data protection supervisory authorities would ignore applicable law.

    Critics also see key issues still unresolved: “Without details on how the presidential order will be implemented, it means something like ‘We take your privacy seriously on a company website,” criticizes Calli Schroeder of the US organization EPIC, Co-Chair of the Digital Division of the transatlantic consumer dialogue TACD.

    In ‘t Veld: Presidential decree is ‘pig with lipstick’

    “This one needs to stick,” says Eva Maydell, EPP MEP from Bulgaria. Sophie in ‘t Veld is clearly disgruntled. The Dutch liberal expects that the European Court of Justice will have to rule on “Schrems III” relatively quickly: “US and EUCommission apparently still haven’t learned that putting lipstick on the Privacy-Shield-pig will not fool the CJEU,” the D66 politician vented her anger on Twitter.

    Max Schrems is already considering whether the US bill will prompt him to go to Luxembourg for a third time after Safe Harbor and Privacy Shield. In a first reaction he criticizes: “The EU and the US now agree on use of the word ‘proportionate’ but seem to disagree on the meaning of it”, he already sees a first, important point of attack for a possible court case against an EU adequacy decision. His prediction: “In the end, the CJEU’s definition will prevail – likely killing any EU decision again.”

    • Data
    • Data protection
    • Digital policy
    • Digitization

    Member states hopelessly at odds over brake on energy prices

    The cooler the weather, the more heated the debate about a joint European response to the energy price crisis. By the time of the regular European Council in the middle of next week at the latest, the member states must find a way to protect consumers and companies from grossly inflated energy prices. An informal summit like the one in Prague on Friday does not have to deliver decisions in text form, but it does have to hint at the direction the EU wants to take – that would have been good.

    The 27 countries will soon have opportunities to settle their dispute. On Tuesday and Wednesday, the energy ministers will meet informally in Prague. Nine days later, the regular fall summit in Brussels will take place. The Commission is expected to present its proposal in advance. With sufficient advance notice so that it can be examined by the experts.

    Debate has been going on for weeks

    Officials in Brussels have already had a chance to hear the capitals’ differing opinions. The debate has been going on for weeks. But the tone has become harsher. The German government also bears responsibility. With his double boom, which was not coordinated in Europe, Chancellor Olaf Scholz had done exactly the opposite of what he had always urged other member states to do in the Ukraine crisis: a joint approach.

    Poland, Latvia and Luxembourg were the most vocal in their criticism of Germany going it alone. Poland’s Prime Minister Mateusz Morawiecki said that “German egoism” should finally be put in a drawer. He said he was resolutely against the destruction of the European single market. “The richest EU state with a strong economy is trying to use the crisis to get a competitive advantage for its businesses. That’s not fair.” He said many countries at the summit pointed out, that this was the wrong way to go. The day before, Morawiecki had already warned against “Germany’s dictate” in European energy policy.

    The criticism is fierce: Berlin is subsidizing gas, thus fueling consumption and giving its companies an unfair advantage. On the other hand, Germany is blocking all attempts by others to impose an EU-wide energy price cap.

    Scholz stands by double boom

    Scholz defended the “double boom.” All states had to help their citizens through the crisis. Other member states were doing the same. He received support from Mark Rutte from the Netherlands, who also rejects the EU-wide gas price cap.

    Without naming Berlin, however, Commission President Ursula von der Leyen warned at the summit against “fragmentation and distortion” of the single market. Protecting the common market is of the utmost importance, she said.

    The debate on a price cap is not made any easier by the fact that there are such conflicting views. The less radical option would be subsidization from EU funds. But that would be enormously expensive. The more radical option would be to cap the price of natural gas imported into the EU. However, this would be dangerous: Suppliers could then steer clear of the EU in the future. Berlin is thus not convinced.

    The Commission is also skeptical and attaches specific conditions to the introduction of a gas price cap: higher, mandatory gas savings and mandatory solidarity agreements.

    Many attempts expected

    The Commission is pursuing three strands: explore how to dampen prices in the gas market, and negotiate a corridor for reasonable prices with reliable suppliers. And: try to limit the influence of the gas price on electricity pricing.

    Four member states (Italy, Poland, Greece and Belgium) are reported to have submitted a paper proposing a three-step procedure to address the Commission’s concerns.

    As unsatisfactory as the situation is after the meeting in Prague, one forecast is possible: In the coming days, there will be a whole series of attempts from member states to forge a compromise. In Brussels jargon, these trial balloons are also called “non-papers.” The stakes are high: The measures are intended to help avoid energy emergencies. Heated questions need to be answered, now that it has already become much cooler in Brussels.

    • Energy
    • Energy policy
    • European Council
    • European policy
    • Fossil fuels
    • Natural gas

    News

    JURI Committee submits opinion on Chips Act

    With the Chips Act, the EU intends to create a strong European semiconductor ecosystem and secure Europe’s technological sovereignty in the future. JURI rapporteur Tiemo Wölken (S&D) proposes a new technological path to achieve this, in his opinion for the Legal Affairs Committee: Europe should promote open source to create a foundation on which the economy could build. It involves transferring the known open-source concept from software to hardware. This is according to the JURI opinion, which is available to Europe.Table, and will be published in the coming days. Most of the proposed amendments relate to Article 4 of the Commission proposal.

    The JURI Committee’s amendments have two objectives:

    • Strengthen the role of open-source in intellectual property (IP) in the semiconductor sector. In doing so, promoting this fundamental technology should lead to its adoption and further development by key industries.
    • Provide legal clarity on the treatment of confidential information and IP – especially towards untrusted third countries. At the same time, keep the door open for trusted partners explicitly.

    Open source instead of proprietary technologies

    Currently, European companies pay high licensing fees for proprietary semiconductor technologies and tools, which is a barrier to market entry, especially for SMEs. Wölken is convinced that open-source IP will lower these barriers while reducing Europe’s dependence on proprietary intellectual property from outside the EU.

    In addition, the JURI committee fears that the Commission’s proposal will lead to legal uncertainty because it does not contain sufficient protection of confidential information and intellectual property. Intellectual property theft, industrial espionage, or the violation of confidentiality agreements are not only economic problems for the companies concerned. These practices could also harm European defense interests and national security.

    To build an open-source chip ecosystem, Wölken suggests:

    • prioritizing funding of open-source reference designs (such as RISC-V) and standards
    • developing and deploying open-source development tools (including EDA and CAD)
    • promoting the use of open-source IP in vertical sectors such as automotive, manufacturing, and healthcare.

    Rapporteur Dan Nica (S&D, Romania) on the lead ITRE Committee already submitted his draft report on the Chips Act in September. The ITRE Committee will deal with the issue at its meeting on October 13. Wölken’s opinion will be discussed in the JURI Committee on October 26. vis

    • Chips
    • Chips Act
    • Chips Act
    • European Defense

    BSI President tumbles over lack of distance to Russia

    All options are being examined,” the spokesman for German Home Secretary Nancy Faeser (SPD) confirmed again this late Sunday evening: Arne Schönbohm, head of the largest cybersecurity agency in Europe, must fear being recalled due to a ZDF report. He is accused of lacking distance from Russian intelligence circles.

    The matter is also observed with interest in other European countries: The German Federal Office for Information Security (BSI) is the best-equipped civilian cybersecurity agency in the EU – and its structural separation from intelligence services means it is also a welcome partner in other countries. In addition, the BSI is part of the European IT security structure and is practically responsible for enforcing large amounts of the NIS directive.

    Schönbohm had come under criticism following a report by ZDF Magazin Royal: Before becoming BSI President, Schönbohm had co-founded the association Cyber-Sicherheitsrat Deutschland e. V. in 2012 and served as its president. Among well-known commercial enterprises, the German Federal Ministry of Health and the German Aerospace Center, a company now called Protelion, that offers cybersecurity products is also a member. In fact, however, it is the German subsidiary of Infotecs (ИнфоТеКС), which was founded in Russian intelligence circles.

    Schönbohm maintained close contacts with the so-called Cyber Security Council until the very end and gave the ceremonial speech on the occasion of the tenth anniversary of the association he co-founded – and according to Business Insider, he did so with the permission of State Secretary Markus Richter, who was also installed under Union Home Secretary. Schönbohm must have been aware of the problem. His successor as chairman of the association, Hans-Wilhelm Dünn, had already become the subject of critical reporting in 2019 because of his lack of distance from Russia, in the context of which Schönbohm prohibited his own employees from contact with the association until the allegations had been clarified.

    Schönbohm had come to office under CDU Home Secretary Thomas de Maizière in 2016, despite vocal criticism from civil society and the opposition at the time. De Maizière found the son of former Brandenburg CDU Home Secretary Jörg Schönbohm suitable to head the cybersecurity agency, whose origins lie in the BND’s cipher department. fst

    • Cybersecurity
    • Digital policy
    • Digitization
    • Germany

    Crisis aid rules to apply until end of 2023

    The Commission wants to extend the crisis aid rules by a year. This is according to the proposal sent by the Commission to the member states last week and quoted by the French specialized information service Contexte. State aid exemptions are to be extended for a year. They allow member states to help companies with the sharp rise in energy prices resulting from Russia’s war of aggression on Ukraine.

    Accordingly, they are now to apply for a limited period until December 31, 2023. As Contexte further reports, there will be no change to the maximum amounts up to which member states can relieve companies of gas and electricity prices. However, the limits are to be calculated for the calendar year. Individual industrial companies can receive support from the state of up to €2 million a year.

    Particularly energy-intensive companies will even be able to receive up to €50 million a year. In the future, heating and cooling bills can also be included to determine the higher expenditure. The Commission also plans to allow subsidies that promote electricity saving. Member states now have a few days to request changes. After that, the proposal will be published. mgr

    • EU
    • European Commission

    Additionality: Hydrogen umbrella organization formulates demands on EU policymakers

    The hydrogen umbrella organization Hydrogen Europe formulated criteria that the Delegated Act on Additionality in relation to green hydrogen must meet from its point of view. Hydrogen Europe’s letter to EU Commission President Ursula von der Leyen and RED-3 rapporteur Markus Pieper (CDU), available to Europe Table, calls for:

    • a transition phase until 2028 when phasing in additionality. Only in this way can the long approval procedures be taken into account, they say
    • ten-year grandfathering for early investors following the transition phase. First movers would then only have to comply with the additionality rules in the second half of their production cycle
    • monthly correlation for all market participants. Monthly correlation should also be possible for projects that do not receive public funds. Coverage on a daily and hourly basis should be done later on
    • Geographic correlation: Member states should receive flexibility in bidding zones. Electrolyzers do not have to be located in the bidding zone where the green electricity is generated; they should also be allowed to be located in a neighboring bidding zone. 

    The subject of the EU legal text on additionality is to define under which conditions the energy carrier hydrogen can be classified as “renewable.” In its letter, Hydrogen Europe urges the EU to increase the legislation pace significantly. It is of paramount importance, it says, to immediately remove the political uncertainty surrounding renewable hydrogen. Otherwise, Europe risks losing its leading role in building a hydrogen industry, he said. “The renewable hydrogen industry cannot afford to wait another three months to have production rules.” The authors warn, that a patchwork of national rules, as member states implement RED 3, would complicate trade in the internal market and paralyze investment. mgr

    • EU
    • European Commission

    EU states to train 15,000 Ukrainian soldiers

    The EU states want to train around 15,000 Ukrainian soldiers. According to EU sources, the Political and Security Committee (PSC) reached an agreement to this effect. The PSC brings together the ambassadors of the EU states under the chairmanship of the EU’s External Action Service. The decision still needs to be formally confirmed by EU countries.

    Czech Prime Minister Petr Fiala said after an informal EU summit on Friday that he welcomed an agreement on a training mission for Ukrainian troops, but did not give a specific figure. As reported by “Welt am Sonntag” and “Spiegel,” Germany and Poland, among others, are to train the Ukrainian soldiers. Training courses are also planned in other EU countries, they said. dpa

    • European policy
    • Geopolitics
    • Poland

    Heads

    Michael Hager: The most important German official in the EU Commission

    Michael Hager heads the cabinet of the Vice President of the Commission, Valdis Dombrovskis.

    If there were a ranking for the most important German civil servant in the EU bubble, Michael Hager would be right at the top. No one has a more profound knowledge of the laws by which the Commission’s civil service functions. No one carries more experience from the innermost circle of power, the college of 27 commissioners. Of all the Berlaymont cabinet heads, he has been in office the longest. 

    The younger-looking 55-year-old has headed the cabinet of the Commission’s Senior Vice President, Valdis Dombrovskis, since 2019. Before that, he held the same position in the cabinet of the German Commissioner, Günther H. Oettinger, since 2013. Hager, whose daughters were very young back then, was Oettinger’s closest aide. That must have been particularly exhausting.

    Oettinger’s stamina late at night well after the usual closing time for top EU officials is notorious. As Oettinger’s Chief Negotiator, Hager got deep insight into the many issues Oettinger was responsible for: energy, digital topics. Most recently, he had to take care of the Commission’s staff and help negotiate the EU’s Multiannual Financial Framework (MFF).

    Contact for German economy

    Even under Oettinger, Hager was a sought-after interlocutor for German interests on the EU stage. Oettinger was always approachable to business people, both as Prime Minister and Commissioner. Since the new mandate, Hager’s importance has grown once again. Normally, the German Commissioner’s Head of Cabinet is the most important interlocutor for representatives of companies and associations from Germany.

    In the Commission, which started in 2019, this would actually be the task of Björn Seibert, who heads Ursula von der Leyen’s cabinet. But since von der Leyen, as President of the Commission, does not want to be seen in the role of a German commissioner but instead has a pan-European appearance, Seibert drops out. Hager has to cover that.

    Hager goes to the Berlaymont every Sunday to prepare for the weekly “Hebdo” meeting, the round of cabinet heads on Monday where the stakes are hammered in for the Commission meeting. Hager has a monster repertoire. His boss, Latvian Dombrovskis, is responsible for all crucial economic policy decisions from the euro to the reconstruction fund.

    Responsible for economy, currency and trade

    Since Irish Trade Commissioner Phil Hogan was forced to resign for violating Covid rules, Dombrovskis, and thus Hager, has also been responsible for EU trade policy. He does all this while maintaining an extreme calm, with humor, and without ever letting the interlocutor feel his own importance.

    Over the years, Hager, born in the Bavarian part of Swabia, has become an EU official who negotiates his dossiers in perfect French and English. In terms of his studies, this EU career comes as quite a surprise: He studied politics and sinology in Tübingen and spent an extended period in Asia

    In the EU business, Germans sometimes tend to hide their Germanness in shame. Hager does not deny his German origins. He shows up in the evenings at events primarily in the German states’ representative offices, co-governed by the CDU/CSU. Hager is active on the board of the Brussels CDU, the party’s only local chapter abroad. That’s where the circle closes. Each of the Commission’s senior vice presidential posts went to a representative of the European party families. Hager’s boss Dombrovskis belongs to the Christian Democratic EPP.

    String puller on the staff carousel

    Hager is a member of two informal Union-related networks in Brussels. One is the “Genval” round table, named after a lake outside Brussels. Two or three times a year, high-ranking officials close to the Union from Brussels and Berlin meet there with utmost confidence. He is also a member of a network founded in the 1970s when the CDU/CSU lost power in the federal government and was cut off from the flow of important news from the EU: the Aktionsgemeinschaft der CDU/CSU-nahen Beamten in Brüssel. It is headed by Markus Schulte, also a former member of Oettinger’s cabinet.

    The club sees itself more as a service provider. When officials from Germany come to Brussels, they find expertise here. Careerists are out of place, says one who has been involved for a long time. The FDP and Social Democrats also have their own networks in the institutions. But none of them is as successful as the Union’s. When the commissioners were filled after the European elections, a conspicuously large number of Germans with a Union background ended up in the good posts. Representatives of the SPD and FDP tend to be found in the Commission’s engine room. Is Hager still involved today when jobs are passed out to Germans in Brussels? He probably no longer has the time, given the workload in Dombrovskis’ cabinet. Markus Grabitz

    • EU
    • European Commission

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