News | 2017

I. Alber & Geiger Recognised as Top Lobbying Firm

aviationAfter a record number of entries for 2017, the finalists for the EU Public Affairs Awards have finally been revealed. Building on the success of the previous year, the second round of the most prestigious lobbying event took place this November in Brussels.

Once again, we have made an impact. Our team’s enthusiasm and dedication made the difference, vindicating nominations in four categories, namely: Lobbying Firm of the Year, Top Member States Lobbyists, Best Lobbyists in the EU Parliament and Lobbying Campaign of the Year. Alber & Geiger was the clear winner in the Lobbying Member States category for its ability to deliver business opportunities and policy solutions to clients in several jurisdictions. The judges highlighted our ability to shape legislation in Member States and activate Member States for EU-level advocacy efforts.

The new recognition of our efforts inspires us to step up our work and get things done faster and more efficiently. We are a success story in government affairs and our clients trust fuels our efforts for constant improvement of our services.

II. EU to Tackle ‘Fake News’

aviationAmidst increasing complaints, mainly from small and medium market players, the European Commission is launching a series of initiatives to promote fairness in platform to business relations. The initiative is part of a wider strategy to promote transparency and fairness in the Digital Single Market, including countering the recent scourge of fake news.

Social media are gaining ground from printing press as a source of information for an increasing number of citizens. The tidal wave of malicious propaganda and fake news is a huge source of unregulated revenues and poses a direct threat to businesses, business models and consumers alike. Recognizing that the current pattern of news reporting is not sustainable, the European Commission has called for a counter initiative on misinformation with an alignment of policy, legislative and technological measures.

The new strategy is seeking to find a balance between fundamental political and economic rights and the citizen’s right to access reliable information, while it’s expected to raise the regulatory stakes for major online platforms in case they refuse to comply and cooperate. The European Commission has launched public consultations exploring the scope of future actions and it appears willing to adopt an aggressive strategy to tackle fake news by recently allocating funds to the taskforce countering online disinformation. The proposals will most likely not only affect social media operators but also businesses.

III. EU to Approve Rules for Gas Pipelines

telecomunication The EU has launched a final call to arms to complete the existing Gas Directive and clarify the EU energy principles by common rules for gas pipelines, which enter the internal gas market. The objective is to step up efforts to maintain viable alternative gas transit flows after failing to derail the Nord Stream 2 link. The new rules are about to apply to existing and future, domestic and offshore pipelines alike.

The initiative is an attempted response to concerns over the increasing EU energy dependency, which is only expected to be exacerbated over the coming years. The amendment of the Energy Package is expected to ensure that all major pipelines in the EU, or entering EU territory, are operated under the same transparency regime and are accessible to all other operators. This approach is believed to maximise competition and avoid conflicts of interest between operators, ensuring at the same time the resilience of the EU’s gas supplies as well as fair prices.

The present proposal delineates the EU’s attempt to break specific energy export monopolies, providing a new incentive for existing and potential competitors to commence negotiations with the EU. Despite, the business as usual appearances, the proposal shuffles the cards in the ongoing energy game in the EU. Moreover, it is likely to trigger heated reactions in an attempt to open up the energy market to new business opportunities by diversifying the energy sector and reducing dependency on imports.

IV. EU to Tax Tech Giants

aviationThe European Commission is going ahead with plans for a fair taxation regime on digital giants, aiming to balance the low tax regimes that cost EU governments billions of Euros in foregone revenues. The objective of the initiative is to define a fair, efficient and growth friendly approach to the taxation of digital economy.

The current regime is not attuned to the digital era. Rather, it was mainly designed for traditional economies and does not capture activities based on intangible assets and data. Digital firms nowadays are taxed mainly on profits declared in fiscal havens and low tax regimes. That has infuriated many EU Member States due to their inability to impose a more equitable taxation based on the companies revenues. The new plan is designed to force mainly major tech firms to start paying revenue tax in any country that their activities are taking place. Furthermore, in accordance to the OECD standards, some Member States have proposed an additional withholding and an equalization tax.

There are concerns on whether this is the right approach to solve this multi-billion puzzle. Amidst questions on the effects on competition, many believe that a targeted crack down on leading tech firms is doomed to fail. In addition, drawing analogies from corporate taxation regimes to the digital economy can impede growth and drive away digital giants. Regardless, all financial ministers have acknowledged the existing issue and have agreed to proceed together to the drafting of a new proposal. With increasing and vocal opposition, reaching a common understanding seems like an arduous effort and currently all options are open to debate.

V. EU Takes Aim at Food Retailers

telecomunicationThe European Commission has put large supermarket and food retail business under its regulatory radar, in an attempt to rationalize the European food supply chain. The initiative, likely to make its debut as early as in 2018, will place producers and farmers under its aegis, in an attempt to bridle at the hypermarkets power by remedying unfair trading practices and arbitrary contractual clauses.

The current situation has allowed for the accumulation of disproportionate market powers to a few retailers, raising controversy over the misuse of dominant position, price controls as well as abusive and retaliatory business practices. Moreover, the present environment has driven many small-scale producers out of the market, threatening to compromise the entire EU agricultural sector.

Following closely the 2016 recommendations of the Agricultural Market Task Force, the new bill will focus on issues of price fairness and transparency by allowing collective price negotiations and imposing a mandatory price reporting system. Furthermore, the possibilities of easier access to finance for producers as well as the establishing of an independent adjudication system are on the table.

Currently, no concrete proposal has been presented yet. The nascent bill is expected to take form during the following months. This initiative will target primarily supermarkets and food retail business. NGOs and consumers organizations are already voicing their concerns to try and shape the proposal.

VI. EU to Advance with Bank Regulation

aviationIn 2018, the European Commission will introduce initiatives for the development of secondary markets for Non-Performing Loans (NPLs) and the protection of secured creditors from borrowers’ default. This comes against the alarming accumulation of NPLs. The sheer volume of NPLs have overstretched the administrative capacities of the European systemic banks, contributing to inefficiencies, reduced management flexibility and increased transaction costs. Therefore, the European Commission’s initiative is aimed at the development of a harmonized EU framework whereby services such as credit restructuring, collateral administration and debt collection can be efficiently delegated to secondary private market entities.

The above initiative goes in tandem with the need for protection of secured creditors from borrowers’ default. This second part of the initiative, aims to remedy the fragmentation of Member States laws and develop fair and adequate measures to recover value from secured loans when the debtor is in risk of default, which in turn will avert the risk of mounting anew NPLs. This new initiative will allow banks to acquire ownership of encumbered assets in an accelerated, extra- judicial in nature procedure. The new, sovereign backed security, will offer all parties increased access to finance as well as more credible options for creditors to secure their loans.

The expected proposals have already stirred opposition especially over financial protection and judicial oversight. Therefore, the shape of the final rules will depend on the negotiations and amendments prior the proposals are launched and during the decision-making phase.