A&G Newsletter Q3 2022

I. EU to Propose a Nature Restoration Law

Biodiversity has been a topic that has recently been getting more attention within the EU sphere. After three decades since any major legislative efforts, the European Commission has now revealed plans to propose a new nature restoration law to work in conjunction with their goals on biodiversity, as outlined in the Commission’s 2030 biodiversity strategy.

Currently still in its drafting stage, the upcoming proposal will take large steps to ensure better conservation and restoration habits that could be targeted directly at the national level and will likely come with binding restoration targets. Agricultural productions, construction, pollution, overexploitation and climate change are contributors to Europe’s biodiversity loss, factors which in the wake of current geopolitical events could worse. As such, the upcoming proposal carries significant political weight. Early reports of the upcoming proposal include restoration targets for soils, wetlands, peatlands, free-flowing rivers and marine areas, with potentially more upcoming in the future.

While initially planned for publication in 2021, have pushed back the publication of the draft proposal, likely due to issues pertaining to planning and implementation of goals, and setting achievable targets to ensure member state cooperation. Already there have been some concerns by the agricultural sector regarding the viability of the targets, urging the European Commission to consider the growing needs of the European Union.

Alber & Geiger can help you represent your business interests and ensure your voice is heard by legislators.

II. EU to Reform Consumer Credit Directive

The fourteen-year-old EU Consumer Credit Legislation was initially established with the goal of harmonizing the EU framework on credit and facilitating the emergence of a functioning internal market in consumer credit while providing a high level of consumer protection. The digitalization of the consumer credit sector, and consumers in general, have led to drastic changes in consumer decision making, and the emergence of new providers in the market have led to and decrease in transparency and consumer protection. This was further accelerated by the global health crisis, leaving EU households more financially vulnerable.

The revisions proposed by the European Commission include an extension of the scope of the directive, proposing to cover all loans up to €100.000, interest-free credit, short-term loans up to three months and crowdfunding credit platforms. Further, the proposal suggests a cap on interest rates, as well as annual rate changes, to be set by member states, if not already existing. Adjustments regarding information provision are also proposed, such as the delivery of pre-contractual information to the customer earlier, and more transparent creditworthiness assessments in the interest of the consumer.

The public consultation process has revealed mixed positions on the European Commission proposal, with an overall support for harmonization of current rules and inclusion of the digital environment. However, other revisions, such as information provision and overall scope of the directive, are heavily favoured by consumer organizations, while business associations are more in favour of non-regulatory interventions, or changes limited to the digitalization aspect of the credit sector.

Overall, the varying opinions and financial regulation aspect of the proposal mean that there will likely be delays in its implementations, expected to be later this year.

Our experienced team can help you maximize the impact of your position in the European decision-making process and represent your interests in ensuing legislative process.

III.EU to Increase Share of Rail Traffic

After thorough review of the previous EU rail freight network concluded in mid 2021, general consensus in the European Commission has been that there needs to be more initiative by the European Union to increase rail usage, infrastructure and support all throughout the member states. The new Cross-border rail traffic proposal aims to better the management and coordination of rail transport, in line with the European Green Deal and the sustainable and smart mobility strategy.

Currently, freight rail transport is heavily underutilized in the European Union due to the lack of competitiveness within the sector and the lack of sufficient rail infrastructure. This is not only due to mismanagement of the current systems, but also because minimal cooperation between EU member states and stakeholders in terms of digitalization, traffic systems, transparency requirements, etc.

The cross-border rail traffic legislative proposal has set fourth multiple legislative and non-legislative measures to improve rail usage. Most importantly, railway capacity management to ensure the increased use of current rail infrastructure via improvements made in timetable designs, asset management and capacity allocation. Further improvements are to be made in the areas of traffic and contingency management, stronger integration of rail transport in multi-modal logistic chains, performance monitoring and infrastructure use conditionality.

Looking at the public consultation, the different policy options outlined by DG Mobility and Transport are met with different responses. A majority of respondents do not see a simple Refinement of the existing legal framework for rail freight and passenger traffic as a sufficient measure to bring change to the sector. A substantial portion of respondents favour the DGs suggestion of a comprehensive modernisation and harmonisation of rules, processes and tools for freight, while also implementing some centralization aspects at a European level.

The European Commission envisions the adoption of the new proposal in the third quarter of 2022 and based on the general support for change received by participants of the public consultation, timely adoption could be possible.

Our team of experts can aid in benefiting from rule-changes and navigate the new legislative environment with ease.

IV. EU to update smoking regulations

In line with the European Commission’s ‘Beating Cancer’ plans, announced in 2021, the Commission is now looking to revise and update its recommendations on smoke free environments. The last recommendations made by the European Commission were issued in 2009, calling on Member states to provide protection from tobacco smoke in indoor spaces, indoor public spaces, public transportation and other public spaces, as deemed appropriate. Since then, the tobacco industry has moved towards alternative smoking products, such as electronic cigarettes and heated tobacco devices. As of now, these alternative methods of smoking are not covered by the smoking recommendations.

The EU Directorate-General for Health and Food Safety, in its proposal for a directive revision outlines the issue with these alternative smoking products, citing multiple studies conducted on the novel products and their mostly unknown long-term effects on public health and safety. The update would add this product category under the coverage of the EU smoking recommendation and addressing the technological developments. Moreover, the new revision aims to correct certain grey-areas left by the 2009 recommendation, pertaining to the definition of ‘indoor’ or enclosed spaces, leaving some quasi indoor and outdoor spaces only under the supervision of member states on a case-by-case basis and exposing the public to potential harm.

Overall, the proposal is still in its infancy, currently in its evidence gathering stage. Feedback so far has been very mixed, with strong opinions on either side of the spectrum. While adoption is still far away, proposed for late 2023, it is likely there will be considerable efforts by the tobacco industry to portrait their new products as different from conventional tobacco products.

Alber & Geiger can utilize its extensive European network to represent your business interests and propose legislative amendments on your behalf.

V. EU to set new food waste targets

As part of the European Green Deal, currently at the centre of the EU’s decision making, the European Commission is now proposing new EU-wide targets for food waste reduction. In the EU, up to 20% of all food produced ends up as food waste, not only serving as a large inefficiency in the agri-food chain, but also contributing up to 10% to total greenhouse gas emissions. Reducing food waste would alleviate pressure from agricultural production and lessen ethical considerations associated with throwing away food.

The objective of the proposal for directive are threefold. To improve knowledge and awareness on levels of impact of food waste, influence attitudes towards food waste and encourage food waste prevention measures along the production chain and ensuring change in the food value chain towards less waste, such as cooperation between different supply chain actors, awareness programmes, voluntary agreements, food donations and more. While the directive is aimed to cover the EU-level, each member state is free to choose the most appropriate and efficient measures on the national level to ensure best results. So far, there has been large variation across member state regarding food waste reduction efforts, leading to calls for more unified and coordinated approaches to be taken by the European Commission.

The proposal outlines different policy objectives, associated with their respective level of ambition. In a first step, the scope of action, target expression (percentage versus absolute) and member state obligations are proposed, while the second policy steps cover varying food waste reduction targets of 15-25% to 40-50% by 2030.

Currently in its public consultation stage, the proposal has received support by the public and industry associations, calling for more unified efforts across the European Union. The Commission predicts the proposal adoption in mid 2023, a target timeline that is realistic for this proposal.

Our team can assist you in getting ahead of concrete provisions of EU regulations to tailor them to your business interests to the highest possible extent.