A&G Newsletter Q2 2024

1. Commission Unveils Blueprint for Tomorrow’s Digital Infrastructures

The European Commission unveiled a comprehensive strategy aimed at enhancing the innovation, security, and resilience of Europe’s digital infrastructures, which are crucial for the continent’s economic competitiveness. This initiative emphasizes the necessity for robust, secure, and extensive digital connectivity to facilitate emerging technologies such as telemedicine, automated driving, and precision agriculture, which are essential for transitioning into the future.

At the heart of this strategy is a digital connectivity package designed to kickstart discussions among stakeholders, Member States, and allies on shaping future EU policies.

This includes a White Paper that delves into Europe’s current digital infrastructure challenges and outlines potential investment, innovation, security, and Digital Single Market strategies.

Additionally, a set of recommendations focuses on improving the security and resilience of submarine cable infrastructures through enhanced EU-wide coordination in governance and funding.

A key aspect of the proposal is the development of a “Connected Collaborative Computing” Network (“3C Network”) aimed at establishing comprehensive infrastructures for cloud and edge computing. This initiative intends to facilitate the development of innovative technologies and AI applications across various sectors through a collaborative approach, possibly through large-scale pilots or new significant EU projects.

The strategy also emphasizes the importance of synergizing existing initiatives, like the Next Generation Cloud Infrastructure and Services project, with funding programs such as the Connecting Europe Facility and Digital Europe. It suggests a potential coordinating role for the Smart Networks and Services Joint Undertaking (SNS JU) to foster a collaborative connectivity and computing ecosystem.

Furthermore, the EU aims to maximize the digital single market’s potential by advocating for a balanced competitive environment and reevaluating the regulatory framework to reflect the convergence of telecoms and cloud technologies. This might include harmonizing telecom operator authorizations, integrating spectrum governance at the EU level, revising wholesale access policies, accelerating the transition from copper networks, and promoting the environmental sustainability of digital networks.

To secure Europe’s network and computing infrastructure—an essential component of its economic security—the EU proposes incentivizing the development and bolstering the security and resilience of strategic submarine cable infrastructures. This includes the possibility of establishing a joint governance system and revising financial instruments to better support European Cable Projects.

In response to calls from Member States and stakeholders, the Commission aims to enhance EU coordination, assess and mitigate security risks, develop a Cable Security Toolbox, and streamline permit procedures for cable projects. An expert group on Submarine Cable Infrastructure will be established to oversee these efforts.

Concluding, the Commission has initiated a public consultation based on 12 scenarios presented in the White Paper, which will remain open until June 30, 2024. The feedback received will inform future policy actions.

2. Support for EU Farmers: Targeted Review for Common Agricultural Policy Proposed

The European Commission has proposed revisions to the Common Agricultural Policy (CAP) to simplify regulations for EU farmers while ensuring the policy remains robust, sustainable, and competitive. These revisions, particularly concerning conditionality and CAP Strategic Plans, aim to alleviate control-related burdens on farmers, allowing for greater environmental compliance flexibility. Additionally, national administrations are to receive more leeway in applying standards.

This legislative proposal responds to numerous requests from farmers’ organizations and Member States, complementing ongoing efforts to lessen administrative loads for farmers. It endeavors to balance the need for sustainable agricultural transition, stakeholder expectations, and the desire for swift agreement among the European Parliament and Council. The proposal maintains environmental and climate ambitions within the CAP framework.

The Commission therefore proposes a targeted review of certain conditionalities in the Regulation on CAP Strategic Plans, such as GAEC 8 on non-productive features, GAEC 7 on crop rotation, and GAEC 6 on soil cover during sensitive periods.

Under the proposed changes to the CAP, EU farmers will be encouraged, but not required, to maintain non-productive areas like fallow land for biodiversity, with financial incentives offered through eco-schemes. The revisions will allow farmers more options in meeting crop rotation requirements, enabling them to choose between crop rotation and diversification based on their specific environmental conditions and challenges, such as drought or excessive rainfall. Additionally, member states will be granted greater discretion in determining sensitive periods for soil cover, adapting practices to suit regional climatic variability and conditions, thus offering tailored approaches to sustainable farming.

The Commission also proposed some exemptions. This includes targeted exemptions and potential derogations for adverse weather conditions, alongside a proposal to simplify amendments to CAP Strategic Plans and relieve small farms under 10 hectares from compliance-related controls and penalties.

Furthermore, the Commission proposes to enhance farmers’ positions within the food supply chain, introducing a production cost observatory, suggesting improvements to contract regulations and producer organizations, and contemplating new cross-border enforcement rules against unfair trading practices. An evaluation of the Directive on unfair trading practices is also planned, with the first report due in spring 2024. Another evaluation that legislative proposals could accompany is planned for 2025.

3. Commission Proposes Measures against Counterfeiting and Intelectual Property Protection

The European Commission introduced a Recommendation known as the EU toolbox against counterfeiting to strengthen the fight against counterfeiting and enhance the enforcement of intellectual property rights (IPR) both online and offline. This initiative seeks to promote cooperation among rights holders, service providers, and law enforcement agencies, and to encourage the adoption of modern tools and best practices. It outlines strategic measures to protect companies’ intangible assets from counterfeiting and cyber-theft, including the use of the IP Enforcement Portal by the EU Intellectual Property Office (EUIPO) and the adoption of modern techniques to tackle new forms of counterfeiting.

The Recommendation suggests several key actions, such as establishing a unified contact point for IP enforcement, modernizing the Memorandum of Understanding on counterfeit goods online, and introducing dynamic injunctions to tackle mirror websites. It also promotes alternative dispute resolution for IP disputes, reviews sanctions for criminal IP offences, and supports market surveillance enhancements. Additionally, it aims to integrate IP education in training curricula and introduce IP practices tailored to AI and virtual worlds.

For SMEs, the Recommendation offers financial support through an “IP scan enforcement voucher” under the SME Fund, a Cybertheft Prevention Toolkit, and guidance on utilizing AI while protecting intangible assets. The Commission, in partnership with the EUIPO, will monitor the Recommendation’s implementation and evaluate its effectiveness in three years to determine the need for further EU-level measures.

4. New Action Plan to Boost Biotech and Biomanufacturing in the EU

The European Commission has outlined a comprehensive plan to enhance biotechnology and biomanufacturing within the EU, as detailed in the Communication on Building the future with nature. This plan addresses various challenges and aims to align with the Communication on the EU’s long-term competitiveness, highlighting biotechnology’s potential to revolutionize sectors like agriculture, energy, and healthcare through advancements in life sciences, digitalization, and artificial intelligence (AI).

To overcome obstacles such as regulatory complexity and access to finance, the Commission proposes several actions including leveraging research, stimulating market demand for bio-based products, streamlining regulatory pathways for quicker market access, fostering investments, and enhancing biotech-related skills. Key initiatives include the development of the Industrial Biotechnology Innovation and Synthetic Biology Accelerator (EU IBISBA), exploring bio-based content requirements, establishing an EU Biotech Hub, promoting regulatory sandboxes, and advocating for specific challenges on biotech in the European Innovation Council (EIC) accelerator programme.

Furthermore, the Commission intends to support international cooperation, the use of AI in biotech, and review the EU Bioeconomy Strategy, emphasizing the sector’s role in achieving a more competitive, resilient EU capable of facing green and digital transitions.

The Commission will also review the EU Bioeconomy Strategy by end 2025.

5. Commission Launches New Strategy on Carbon Capture and Climate Neutrality

The Commission’s newly adopted Industrial Carbon Management Communication outlines a strategy to reduce emissions by 90% by 2040 and achieve climate neutrality by 2050, proposing the development of at least 50 million tonnes per year of CO2 storage capacity by 2030, expanding to approximately 280 million tonnes by 2040. The plan includes preparatory work on a future CO2 transport and storage regulatory package, and strategies to scale up markets for CO2 capture and storage, including project permitting guidance and an atlas of potential storage sites.

The Commission will assess necessary volumes of CO2 removals, aiming to integrate these into the EU Emissions Trading System, and will work to establish a clear carbon accounting framework to encourage the use of captured CO2 in industrial processes. To foster an attractive investment environment for carbon management projects, the EU proposes promoting these projects through energy infrastructure programs, assessing funding mechanisms, and enhancing research and innovation, including through Horizon Europe and the Innovation Fund. Furthermore, the EU intends to engage in international cooperation to harmonize reporting and accounting for carbon management activities, ensuring that international carbon pricing frameworks account for removals in challenging sectors.