EU opens public consultation for its upcoming Climate Law

In March, the Commission opened the public consultation for the European Climate Law which is the first major realization of the New Green Deal. As part of this process, the European Commission is seeking the views of stakeholders to design climate action and share information to develop these new policies. The consultation period will run from 4 March to 27 May 2020 with the aim of adopting the law before November 2020.

This law will translate the European Union’s Green Deal commitments into law. The European climate law will enshrine the objective of climate neutrality by 2050 in European law and will set up the various financing funds. This Act sets out a greenhouse gas emissions reduction trajectory by September 2020. Thereafter the Commission will initiate a review of several EU regulations to ensure their compatibility with the climate trajectory. By June 2021 the Commission wants to re-evaluate the Emission Trading System (ETS) Directive, the Effort Sharing Regulation, the Energy Efficiency Directive, the Renewable Energy Directive and the CO2 Performance standards for Cars and vans. Public consultations for several of these regulations are already underway.

With the opening of public consultations, the Commission is seeking input from all stakeholders in order to guide its climate law. The Commission stressed the importance of scientific data and industry solutions in defining its action plan. Therefore, all companies related to the energy, environment, transport and other industrial sectors impacted by the revision of these regulations under the European Climate Law should be involved in the public consultation process in order to safeguard their interests.

EU paves the way to a closer association with Africa

The European Commission and the High Representative for Foreign Affairs presented the basis for a new strategy with Africa on March 11. Several objectives are outlined in the Action Plan: establishing a partnership on green and digital transition, supporting the development of a legislative framework for trade and investment, defining partnerships in education and research, increasing investment and cooperation in the humanitarian and security field. In this sense, what the Commission is planning will affect all companies that trade or plan to trade with Africa, but also all African States themselves, which will be able to benefit from this strengthened partnership.

More specifically, the energy sector is particularly concerned, as the EU wishes to step up investment in decarbonised energy. Regulatory convergence will be promoted, in particular on e-commerce and the digitisation of financial services and data regulation. African states will benefit from a renewed flow of investment of public and private funds. Through the NDICI tool, the EU foresees more than EUR 60 billion of investment in guarantees from 2021 to 2027. In addition, the EU will provide financial and technical assistance in the implementation of the African continent’s free trade agreement. This partnership will also be an opportunity for companies with activities in Africa to strengthen their presence. The programme provides for the establishment of a regulatory framework to ensure a level playing field and investment protection in all African States.

To sum up, this new strategy marks the EU’s willingness to strengthen its relationship with Africa in various fields, from ecology to the digital economy. The aim is to reach a new Joint EU-Africa Strategy replacing the 2007 Joint Strategy after the new African-EU Summit planned for October 2020. This document sets out a renewed ambition for Africa-EU relations. It is necessary for African States as well as for companies trading with Africa to strengthen their presence in Brussels in order to make the most of these renewed ambitions.

EU’s Data Regulation

At the start of the year, the European Commission published a European strategy on data. The strategy covers data economy, data protection and standardized data sharing. It envisages also the creation of an EU Data Law in 2021. There will be strict rules that other countries might replicate in the future.

In more detail, the strategy foresees measures for data access and use including a legislative framework for the governance of common European data spaces that will be presented in the fourth quarter of 2020. In addition, the European Commission will invest in strengthening the EU’s capabilities and infrastructures for data processing and interoperability. In fact, the European Commission intends to set-up a cloud service marketplace in the fourth quarter of 2022. Moreover, the European Commission intends to empower individuals with respect to their data and build capacity for small and medium enterprises. Last, the European Commission will promote common European data spaces in strategic sectors such as energy, finance, health and agriculture.

The European Commission has initiated a consultation process on the European strategy on data, which will last until May 19, 2020. European and non-European industries, especially those that are heavily data driven, need to raise their voice in Brussels and in key capitals like Paris and Berlin now that the debate has started.

EU carbon border tax

The European Green Deal, proposed by President von der Leyen to be delivered in the initial 100 days in office, will include the first European Climate Law enshrining the 2050 climate-neutrality target into legislation. The Green Deal will include a more inclusive Emissions Trading System (ETS), as well as a Carbon Border Tax to mitigate ETS’s effects on the market.

An extension of the ETS in the airlines sector will be translated to increased costs for the industry and additional taxes. The adjustment tax is yet to be formally proposed, but it aims to prevent businesses from relocating to laxer jurisdictions, creating ‘carbon leakage’, and to protect them from non-EU competitors.

The additional tax-burdens are met with criticism due to their incompatibility to WTO rules and the distortion of the level-playing field. If not applied unanimously with European unilateral backing, the tax adjustment risks high costs for businesses and consumers. Additionally, sectors with a high degree of cross-border division of labour or a global supply chain will be most heavily affected. Ramifications of the supposed tax were also felt in wider sectors outside the energy industry, as the levy is feared to worsen trade relations with the US, causing increased tariffs on EU products.

EU to enforce rules on online payments

The European Payments Service Directive II (PSD2), in force since January 2018, is currently stirring debate among Member States regarding the process of its implementation. The Directive is designed to harmonize and simplify money transfers inside the EU, decrease fraud in online payments, and inform consumers about the rights and obligations.

The revised PSD2 extends several obligations concerning data protection and information to and from international payments. It mandates stronger security requirements for online transactions and obliges providers to request customer authentication and demands they register. While the PSD2 compliance date was set for September 2019, the European Banking Authority unconditionally extended the implementation period in order to allow for full application of the new requirements. Nevertheless, a fixed common EU-wide transition period, agreed upon by Member States, is anticipated by the European Commission in order to ensure state-wide compliance.

Enforcement of PSD2 will allow consumers and merchants to increasingly benefit from the internal market and e-commerce. Its efficient integration will increase competitiveness and cost-efficiency for consumers and service providers. PSD2 will allow companies, other than banks, to offer new financial services to the public with consumers’ consent.

EU restrictions on electrical and electronic materials

European legislation restricting the use of hazardous substances (RoHS) in electrical and electronic equipment was approved in 2003 and has since been reviewed in 2011 and 2017. The European Commission initiated in September a consultation to collect public and business’ opinions in order to assess the performance of the restriction of hazardous elements, the management of chemical waste and the impact of these materials on human and environmental health. Currently the use of lead, mercury, cadmium, hexavalent chromium, PBB and PBDE in electrical and electronic equipment is restricted. Four phthalates were recently added to this list in July 2019.

The evaluation will assess the effectiveness, efficiency, relevance and coherence of the current RoHS. The consultation will evaluate the functioning of the Internal Market, ensuring that the current legislation avoids distortion of competition that arises from differing product requirements among Member States. Input from the consultation will shape the Commission’s decision on policy options for the future. Amendments to the directive will affect a wide scope of manufacturers, as any product, which requires electric currents, is within scope. It has potential to affect the circular economy, restrict chemicals, and increase the standards of chemical waste management.

Alber & Geiger ranked among top lobbying firms in Europe

Alber & Geiger has been recognised for the fourth consecutive year as one of the top lobbying firms in Europe. The firm was shortlisted in four categories, including Lobbying the European Parliament, Consultancy Campaign of the Year and Consultancy of the Year by the Public Affairs Awards Europe 2018. Alber & Geiger picked up the award for the second year in a row in the Lobbying Member States category for its ability to generate Member State support at the EU level as well as work at national and local level in particular Member States.

Alber & Geiger’s team has decades of experience in representing clients in Europe through a broad range of activity. Our team is involved in many EU policy issues and regulatory matters, as well as active before all EU institutions and agencies, in addition to special national and local officials at the Member State level in Europe. Many of Alber & Geiger’s practitioners have a deep understanding of EU legislative and administrative procedures.

EU to regulate endocrine disruptors

On 7 November 2018, the European Commission adopted a Communication on endocrine disruptors. The Communication lays the groundwork for potential, new regulatory measures that will address endocrine disruptors across different areas in the EU, and beyond.

Currently, the EU legal framework on endocrine disruptors is incoherent. First, different approaches apply to different sectors. Second, different regulatory approaches exist in different pieces of EU legislation that regulate endocrine disruptors. Against this backdrop, the EU will launch a process to assess whether existing EU legislation on endocrine disruptors delivers its overall objectives. In addition, it will set a common definition for the identification of endocrine disruptors. The review and expected new legislation shall provide more coherence.

The European Commission will consult with all stakeholders as it reviews and prepares to revamp the rules on endocrine disruptors. It will also rely on output from stakeholders as it sets out to include endocrine disruptors in the existing international system for classification of chemicals.

EU to strengthen rule of law compliance

In 2014, following threats to the rule of law in several Member States, the European Commission decided to launch a framework to address such systemic threats through dialogue with the concerned countries. Until now the process consists of an assessment of the problems, followed by concrete recommendations and a monitoring mechanism.

Building on the existing framework, the European Commission has set out to strengthening the capacity of the EU to ensure effective and equal protection of the rule of law in all Member States. It is expected that a panel of experts would assess the rule of law situation in each Member State and make a public summary of the findings. The strengthened requirement for rule of law compliance raise the risk of concerned countries being stripped of EU funding through suspension or reduction of payments.

Member States, and all countries that rely on EU funding, must pay close attention to how they are meeting their rule of law commitments and communicate this effectively to the European institutions.

EU to regulate facial recognition

The European Commission is planning a regulation, which will tighten the limits on the use of facial recognition technology. The regulation would give EU citizens’ rights over the use of their facial recognition data, marking a precedent in how the EU regulates artificial intelligence.

The European Commission wishes to reinforce European citizens’ protection, which is currently mandated under the General Data Protection Regulation (GDPR). The existing GDPR already prohibits the collection of biometric information used to identify individuals, unless the person gives explicit consent.

The new regulation is anticipated to require the reclassification of facial recognition data, as biometric data under GDPR, therefore explicit consent from the person in question will be necessary. Thus, the regulation will limit private companies’ and public authorities’ use of facial recognition technology and wider AI technology.