News | 2017

I. Alber & Geiger Receives Honor

Alber & Geiger was recognized by the prestigious European Public Affairs Awards (EuroPAwards). Alber & Geiger’s Managing Partner, Dr Andreas Geiger, was handed the Consultant of the Year award for exceptional delivery towards the firm and clients. In addition, the EuroPAwards shortlisted Alber & Geiger as Consultancy of the Year for all around excellence in client delivery. Alber & Geiger was also recognized in the Lobbying Member States category for having succeeded in securing the support of the Member States in its lobbying campaigns. Last, the EuroPAwards named Alber & Geiger for the Consultancy Campaign of the Year for outstanding lobbying work on behalf of the client.

 

II. EU to Tackle Plastic Use

The European Commission will move forward with the implementation of the Circular Economy Action Plan to fundamentally tackle the use of plastics and prevent completely the creation of plastic waste. The major action, expected to materialize in 2017, will most likely address the full life cycle of plastics.

The EU is a global leader in the production of plastics. Plastic manufacturers, and businesses using plastic materials, will be on the receiving end of the challenging targets. Certain plastic products could even face bans.

To maintain the status quo and ensure EU support that would stimulate innovation when it comes to recycling and waste policy, aligned with the needs of the private sector, manufacturers of plastics need to engage immediately, starting with the imminent consultation process.

III. EU State Aid Rules Chasing US Companies

Benjamin Franklin is thought to have said ‘nothing in this world is certain, except death and taxes’. But recent state aid investigations by the European Commission have introduced uncertainty on corporate taxation.

Fighting tax avoidance is a key priority for the EU. Yet, the European Commission’s approach has faced criticism for going after big companies from across the ocean. Apple was slapped with a $14.5 billion tax bill. Other big players such as Starbucks and Amazon are in stage of litigation. The European Commission wants all big business operators to pay their ‘fair share’. Therefore, additional cases are set to arise.

Mitigating the consequences of the EU ‘tax crusade’ by achieving more balanced solution should be a key priority for all big multinational companies operating in Europe.

 

IV. How the Digital Single Market Could Affect business

The Digital Single Market is in the European Commission’s work programme for 2017. The European Commission has carried out four regulatory evaluations in 2016. Now, they will all be followed-up by legislative reviews in 2017.

The major areas concerned are VAT for cross-border e-commerce, AV media services and their flexibility, telecoms regulatory framework and cross-border access to satellite and cable services. Part of the European Commission’s priorities are also new laws establishing cross-border mobility of online content and new aspects for contracts of online sales of goods or supply of digital content.

The associated costs would have to be borne by the service providers of online content and the Member States. Both would have to invest time and money to adjust their infrastructure to comply with the new requirements.

 

V. Big Changes in the Road Transport Sector

The European Commission recently announced the European Strategy on Cooperative Intelligent Transport Systems (C-ITS), focusing on smart cars.

This next step combines the goals of the digital single market and clean transport. Different sectors of the industry such as internet service providers, car manufacturers and communication services would have to take actions until 2019, which is the date for wide-scale commercial deployment of C-ITS.

Addressing issues of security and data protection would entail costs for business. Such costs would be even greater considering legal and infrastructural disparities between Member States. Worth keeping an eye on the expected technical standardization, which will be a fierce battle for securing competitive position on the market. On the institutional side, the discussed creation of EU Road Transport Agency will facilitate equality between manufacturers of automotive products. However, support by the European Parliament will not be enough. Strong engagement of the industry to convince the Council is necessary to make the case for such Agency.

VI. Boom of New Rules in the EU Single Market

The Single Market will be strengthened with a set of new rules 2017. Several existing legislations will undergo revision across different fields. Major changes are expected in customs and taxation.

More concretely, the European Commission will revise the structure of excise duties applied to alcohol. Also, it is expected that the new structure will extend to tobacco products, including e-cigarettes that will become more expensive thus.

Moreover, the envisaged Common Consolidated Corporate Tax Base and measures implementing the VAT Action Plan can bring legal insecurity in Member States. Business would have to adapt their commercial strategy based on the new tax regime. New binding rules for the large multinationals will mean limiting freedom to conduct business and shrink profit opportunities.

 

VII. U.S. corporate lobbying in Brussels after Brexit

brexitBritain’s decision to leave the EU provides opportunities and challenges for U.S. business. What will determine success or failure depends on how American companies react to Brexit. Change is needed immediately on two fronts. First, the extent that they rely on lobbying. Second, the manner how they conduct lobbying in Europe to shape EU policies.

More reliance on lobbying and government affairs will be needed in the immediate future. Brexit has brought political and economic uncertainty. Most U.S. firms will need constant intelligence and advice in order to anticipate and adapt to the thinking in Brussels. They need to stay on top of existing policy initiatives to ensure that Britain’s departure will not affect the spirit and outcome of an ongoing proposal or existing legislation.

The Brexit vote will most likely be followed by an increase in proposals emanating from Brussels. Brexit dominated much of the debate in the EU over the last year. Britain’s referendum took attention away from policy. With the referendum out of the way, U.S. firms need to be prepared to deal with an increase in activity. They will need to think in advance and have their panels ready to cope with new proposals.

Yet change is not only needed in the way U.S. companies rely on lobbying in Europe. More important even is the manner they will go about it. For years now, many U.S. firms have considered London as their natural hub in Europe. As a result, most of them limited themselves to lobby Brussels from London. This needs to change if U.S. business wishes to stay relevant. As many companies are considering moving their headquarters out of London to other European cities to stay in the EU single market, so should their lobbying teams. Only by looking at Brussels in the same way they look at Washington D.C. would U.S. business be able to influence EU policy-making. Failure to do so will seriously affect their ability to shape process and policy.

VIII. EU Commission to support driverless cars between Member States

driverlessFor years Member States have been divided over driverless car technology. This was visible also earlier this year when Member States’ transport ministers decided to sign a joint declaration over driverless vehicles.

Affected industry, in particular car manufacturers and telecom operators, have been trying to persuade the EU Commission to back driverless car technology. Without the financial support coming from the EU, it would be difficult to see how driverless car technology can flourish in Europe and across the Member States. Financial support and adequate regulatory changes are necessary to lay the foundation for driverless car technology to be present onto European streets sooner rather than later.

The EU in general and Commission in particular, have lacked proper coordination that, in turn, has led to failure in making realistic commitments and come up with proposals in this sector. But now comes the real opportunity for all interested parties as the German Commissioner from Stuttgart, Günther Oettinger, who is in charge of the digital agenda is on the driving seat on driverless car technology. He has used the connection of this sector to telecoms policy, which is his agenda, to take the lead in the area over the internal market unit in DG Grow.

All those that have argued in favor of autonomous cars in Europe, have now an opportunity to get what they wish if they engage adequately and intensively with the EU institutions. Especially more so since the Commission is set to propose legislation that will directly and indirectly impact autonomous cars in 2016. DG Move is also planning a revision of the intelligent transport system directive.

IX. EU to modernize trade provisions with Chile

chileChile was the first Latin American country to sign an Association Agreement with the EU. The Association Agreement was signed back in 2002 and it includes, inter alia, political cooperation and several trade provisions.

However, several developments have taken place since then both in the EU and Chile. The EU has signed several agreements with other countries in South America. Most notably, the EU has signed a trade agreement with Colombia and Peru. The EU has also signed an Association Agreement with Central America. Plus, agreement with Canada was completed recently. While TTIP with the U.S. is ongoing since 2013.

The new agreements signed by the EU with other regions and countries are far more comprehensive and offer enhanced preferential treatment. Against this backdrop, Chile’s relationship with the EU risks falling behind.

All interested parties in the trade deal with Chile and, any other third countries that would like to change or preserve their trade relationship with the EU, can now do so now be representing their views before DG Trade.

X. Risk of EU-wide food labelling threatens food industry

verpackungThe French government has recently received clearance from the EU Commission to go ahead with plans to introduce a decree demanding companies to label the origin of diary and meat products. The decree is set to enter into force on January 1, 2017.

As of December 2014, the EU has a revised food information regulation that is still in force today. The regulation imposes labeling rules for certain products only, such as fresh meats. Yet Member States could enact country of origin labeling rules on other products under certain conditions, including consumer protection and public health. Any EU country wishing to impose labeling requirements in products not covered need to notify the Commission.

The French decree and, the EU Commission’s green light, allowing the French authorities to apply the measure threaten the food industry. Especially since France is not an isolated case. Other countries intend to implement similar rules. Italy, Portugal and Lithuania have recently notified the Commission about similar proposals.

Origin labeling schemes applied across several Member States would impose extra burdens to the food industry. They also threaten the single market ideals.

XI. EU approval of GMO cultivation

gentechnikThe EU Commission, via the Standing Committee, met for the first time recently for an exchange of views with Member States over the cultivation authorization in the EU of two new GMOs. Other GMOs will be discussed shortly as the Committee plans to hold other meetings during 2016.

Member States’ stance on GMOs varies. Currently, 15 Member States are trying to keep GMOs out of their territory. As per a new directive that was adopted recently, EU countries may ban or limit the cultivation of GMOs in their respective territories. Member States wishing to do so need to express their reservations during the authorization process and demand an exclusion for their territory. And once a GMO has been authorized, they need to provide compelling grounds that range from environmental reasons to socio-economic justifications.

The working of the Standing Committee on Plants, Animals, Food and Feed is an opportunity for interested companies to get going the discussions over the authorization of their GMOs. In addition, participating in the process and discussions by providing information and data will help overcome the assessment and facilitate approval. Participating in this process will also help relevant companies appeal to all Member States and ensure that their GMOs can be cultivated in the majority, if not all, EU Member States.

XII. EP condemns Bahrain over human rights

bahrainThe European Parliament has recently – via a widely supported resolution – condemned the abuses carried out by the Bahraini authorities.

The EU legislative has called on the Bahrain government to end the repression against civil society and opposition. In the same resolution, European lawmakers expressed concern over the recent travel ban imposed by the authorities in Bahrain on civil society preventing them from attending the work of international bodies. MEPs were also careful to express concern over the treatment of the opposition.

The resolution called on the EU to ensure that Bahrain respects its international commitments and its constitution to ensure basic rights and freedoms. Many MEPs asked the Commission to assert the respect for human rights as a condition for any further development of relations with Bahrain.

Such a strong worded European Parliament resolutions could impact relations with Bahrain. They may even lead to political sanctions. Bahraini authorities in this case at hand, but also countries that might find themselves in a similar situation, ought to engage with the European Parliament and EU institutions in general to minimize the risk of restrictive measures.