News | 2022

I. A&G Newsletter Q2 2022

I. EU to Harmonize Certification of Organic Farming

On March 31st, the new European Commission ‘Organic Action Plan’ was approved by the European Parliament for implementation. In this new legislation, the EU puts emphasis on the further development of the organic farming sector. The new plan builds on the achievements of the prior 2014-2020 action plan and reinforced the commitment of the European Union to achieve the Farm to Fork Strategy’s target of 25% organically farmed land by 2030.

Importantly, the new action plan also seeks to widen the certification of organic farming, looking to cover the entire value chain of organic productions. According to EU analysis, this would drastically improve the recognition and consumption of organic products, thus also encouraging the increase in organic farming. Specifically, the new action plan aims to enhance transparency and traceability in the organic production value chain, not only enhancing oversight, but also consumer trust.

Overall, the new Organic Action Plan rests on the successful achievements of the past organic strategies, which have successfully increased the area under organic production by 66% in the last 10 years and led to improved biodiversity in organically farmed land by close to 30%. Public consultation on the action plan saw the widespread recognition of the issues surrounding organic farming and the threats posed by lack of traceability and in non-harmonized certification, such as the competition of the EU organic production label with private label products.

Alber & Geiger’s expert team can help you make sense of the rules and overcome hurdles to your business.

II. EU to revise Cosmetics Product Regulation

As part of the European Union’s flagship chemical strategy for sustainability, the European Commission now opened the public consultation on the ‘Cosmetics Product Regulation’, aiming to revise the regulation and boost innovation for safe and sustainable chemicals and address the environmental and health concerns caused by harmful chemicals. The consultation seeks the public’s opinion on multiple topics, such as expanding the range of prohibited chemicals in cosmetics, updating labelling requirements on cosmetics and increasing risk assessment requirements.

The updates to the cosmetics product regulation have three aims overall, largest of which is to improve effectiveness, efficiency and coherence of safety assessments across EU legislation. Here, the European Commission is considering merging the current regulatory body, the Scientific Committee on Consumer Safety, with a centralized European agency, such as the European Chemicals Agency. This would improve efficiency, transparency and consistency of chemical safety.
Another regulatory improvement considered by the EC is concerned with the definitions of nanomaterials found in cosmetics, usually as a means of efficient substance carriers or skin penetration. Here, the aim is to update the definitions to be coherent across chemical sectors and update the transparency requirements on nanomaterials.

Further, improvements are aimed at the labelling requirements of the cosmetics sector. While the essence of the practice won’t change, and manufacturers will still be obliged to provide detailed ingredient lists, the European Commission is looking to increase consumer understanding and avoid overloading the product packages with information. Here, specifics on the direction the European Commission will go are likely to result from the public consultation.

Overall, as part of the chemical strategy for sustainability, the updates to the cosmetics product regulations are aimed at consumer protection and coherence among EU legislation. With the current consultation ending in June 2022, the earliest adoption of a draft legislation could be seen towards the very end of 2022, albeit delays being a possibility.

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 accelerate Solar energy adoption

The European Green Deal has been the centre of EU policymaking in recent years. Renewable energy deployment lays at the heart of the Green Deal and its acceleration will have large positive impact on achieving the goals set out by the leading EU policy. With the recent conclusion of the consultation period on the ‘EU solar energy strategy’, the European Commission has come closer to decreasing EU dependence on fossil fuels and lowering energy prices.

2020 has been the largest year for solar energy so far, supplying 5% of the European Union’s electricity. As part of the European Green deal and especially in light of the recent geopolitical developments, the EU has made several pledges to increase that number. The new EU solar energy strategy reflects these efforts, aiming to tackle the most common problems with solar adoptions such as tendering procedures, financial support, permitting and grid connections. Further, the plan aims to increase market availability of solar products by driving the prices down through support for competition in the sector, while maintaining high standards of production and sustainability requirements.

The public consultation has overall received good support for the accelerated strategy, heavily criticising European dependence on third country fossil fuels. Overall, the strategy came at the right time to further incentivize member states to coordinate an accelerated approach to the energy transition. This is further supported by widespread calls in the European Parliament of raising the renewable energy targets from 32% to 45%, with some MEPs even suggesting higher numbers. While specific policy options have not been set out yet, the widespread support will likely yield an early adoption of the strategy in the second quarter of 2022.

Our team has extensive experience in the technology and energy sectors and can offer advice and services to grow your company.

IV. EU to revamp VAT for the digital age

After 30 years, the Value Added Tax (VAT) system in the European Union is getting an update. The new proposal aims to bring the system into the digital age and reduce both fraud and burden on businesses and governments. Now in its public consultation stage, the ‘VAT in the digital age’ legislative proposal is indicated for European Commission adoption in the third quarter of 2022.

With an increasingly digital economy, the European Union has been in dire need of an update to the outdated VAT legislation, considering cross-border sales of goods and services across EU member states. Currently, national instruments are not sufficient in tackling cross border and e-commerce fraud, as indicated by a large discrepancy between expected VAT and collected VAT on a European level. The new VAT proposal aims to solve this issue by simplification and harmonization of current rules and their modernization to help businesses benefit from the potentials of the single market. The plan includes different objectives, such as making VAT compliance easier for EU businesses operating in the digital space, creating a harmonized framework to combat tax fraud and prevent market fragmentation and ensuring the fair treatment of regular and platform economies.

The European Commission is currently looking at different policy options, ranging from the introduction of digital invoicing and reporting obligations to a single VAT registration platform across all member states. With the current consultation in progress, it is likely that there will be changes made to the policy options in question. The public consultation has already received heavy criticism on the introduction of digital taxation from EU citizens, and we are yet to see how companies react to the proposed changes of VAT procedures.

Alber & Geiger can use its extensive experience and network in the European Union to represent your business interests and propose amendments to maintain the viability of your e-commerce projects.

V. EU to revise food packaging information

With the ‘Farm to Fork’ strategy, the European Commission has recently focused its effort on creating a more fair, healthy, and environmentally friendly food system. An important addition to that is a revision of the current food labelling practices such as standardized front-of-pack nutritional labelling, origin information and date markings.

The revision proposal stems from multiple studies conducted by the European Commission on consumer behaviour and expectation in regard to food packaging. Most importantly, the lack of harmonization on nutritional labelling, along with current abuse of nutritional and health claims on products can impact consumer health. Currently, there are no regulations on what kind of product is allowed to bear nutrient or health claims. The proposal aims to change that by restricting such practices on products that are excessively high on e.g., sugars or saturated fats.

Further, the new proposal aims to unify origin information practices. With growing demand on origin information, EU member states have enacted mandatory labelling nationally, and the proposal aims to unify these laws Union wide. The last issue the revision seeks to fix is the common misunderstanding of date markings. According to studies, misunderstanding of date markings cause up to 10% of EU wide food waste; a problem that the Farm to Fork strategy looks to mitigate.

It is expected that this reform will have great impact on achieving the objectives set out in the overarching Farm to Fork strategy. The new measures would help consumers make better choices, as well as level the playing field between food business operators, some of which use misleading tactics in order to promote a ‘healthier’ product. It is also expected that the bill will lead to more sustainable consumer consumption, driven by demand for more sustainable products and less waste.

Overall, the public consultation shows a positive response for the harmonization of food labelling and the other measures, with some concerns for the implementing costs on business sides by participating representative organizations. After the release of the official summary of the consultation, it is expected that this revision will likely come into effect in the last quarter of 2022.

Alber & Geiger can put its distinguished policy team at your disposal to help you further understand and influence the current and future state of food regulations.

VI. EU to revise Alcohol Tax

As part of the revision of the tax structures on alcohol and alcoholic beverages that came into effect in January of 2022, the EU is now looking to update excise duty rates on alcohol. The last changes made to excise duty rates were in 1992, and along with the European Union’s general push for tax harmonization on alcohol, the excise duties are now under review.

Current legislation on excise duties on alcohol specify the minimum rates of duty on different alcoholic products such as beer, wine, fermented beverages, intermediate products, and ethyl alcohols. While member states can set duties according to national preferences, they are required to be above the minimum EU level.

The revision of excise duties on alcohol products does not only stem from the harmonization efforts by the European Union. Both the ‘Europe’s Beating Cancer Plan’ and ‘United Nations Sustainable Development Goals’ specify the societal cost of alcohol and harmful consumption. The current review of the excise duties thus will seek to measure the impact of alcohol consumption against these economic and social costs and utilize taxation as a levelling instrument to combat harmful consumption.

Currently, the rates and structures of excise duty on alcohol and alcoholic beverages are under evaluation, supported by the open public consultation session till July 2022. While a previous proposal in 2006 did not get adopted, it is likely that the new proposal will pass in the Commission. As of now, planned adoption of the new excise duty structures are planned for mid 2023.

Our expert team can help protect the industry and utilize their experience to advocate on your behalf.

II. A&G Newsletter Q1 2022

I. EU to strengthen regulation of crypto

As the widespread adoption of cryptocurrencies accelerates, the European Union is pushing for stronger regulation on the emerging asset class, citing concerns over money laundering and lack of oversight on the sector. Currently, the EU remains one of the laxer regulators of cryptocurrencies, aiding in the adoption and innovation of blockchain technology.

First attempts at serious regulation of digital finance such as cryptocurrencies were proposed in 2020 with the “Markets in Crypto Assets” (MiCA) bill, outlining standards, safeguards, and an increase in supervisory power over digital assets. Further legislations have been drafted regarding anti-money laundering measures such as an increase in customer verification procedures and transfer traceability. However, recent concerns over Facebook’s project of creating an asset pegged online currency (stablecoin) have once again flared up discussion over the economic implications of cryptocurrencies and the need for more concrete regulation on the digital asset.

In 2022, it can be expected that the EU will set its sights on more tangible regulatory frameworks regarding crypto. Late last year, the European Council adopted its position on the MiCa framework, meaning that negotiations in the European Council and European Parliament can now start, prior to the adoption of the text. The new framework promises to continue the facilitation of growth for the modern technology by allowing crypto firms to operate more easily across the European Union. However, the MiCA also aims to protect market competition and the Union’s monetary policy by heavily controlling issuing of asset pegged crypto by private companies, while making institutionalized digitalization easier. Overall, this year promises regulatory changes and commitment to the development of crypto related assets.

Alber & Geiger can advise in matters of consumer and privacy protection in crypto in the onset of the new regulatory package and help you maintain your rights and anonymity.

II. EU to shift towards greener aviation

As part of the overall push towards a greener Europe, Brussels lawmakers are now considering phasing out the exemption on fuel tax for the aviation industry. The current energy tax system dates back to 2006, however is not a fitting policy anymore in today’s regulatory climate, where a sustainable future is a key priority.

The plan to tax kerosene and therefore push airlines towards the development of more sustainable aviation fuels is to occur over a ten-year period, starting in 2023. The European Commission stated in a draft document, that the current exemptions on taxation of such pollutants is ‘no longer coherent with the present climate challenges and policies. A further step towards pushing for a greener aviation sector falls under the ReFuelEU Aviation policy, adopted in late 2021, seeking to gradually increase the percentage of sustainable aviation fuels in aviation fuels by binding jet fuel manufacturers to increasing fuel mixing.

Multiple voices within EU institutions however call the EU proposal too disruptive and are asking for amendments to the legislation for effective implementation without economic distortions. The proposed legislation involving taxation, the unanimous approval of all European Union member states is required, making the passing of such policy a lengthy process, with the aviation industry utilizing lobby support for the amendment of the new proposal.
Alber & Geiger can use its extensive experience in EU Affairs to strengthen your position and propose amendments to maintain the economic viability of the aviation industry.

III.EU rules on the trucking sector

The European trucking sector will face major challenges in the first quarter of 2022, as the EU Mobility Package comes into effect. Adopted in 2020 after over three years of negotiations, the legislation aims to increase the quality of life and working conditions of lorry drivers and decrease unfair competition in the transport sector across the European Union.

The package focuses on a guaranteed minimum pay for drivers in their origin country, a substantial issue because of the international, cross border nature of the transport sector. Further, new rules on working time are included in the package, setting new standards for maximum daily and weekly working hours, and upping the minimum rest period both within transport and between transports. This also guarantees that drivers are eligible to return to their home country during mandatory rest periods, leading to an increase in quality of life for long-haul lorry drivers. The newly adopted legislation aims to fight ‘letterbox’ companies, which are typically registered in administratively cheaper countries, but operate almost exclusively outside of the establishment country. Here, the new rulings mandate the return of trucks to their country of origin at least every eight weeks.

Even though the package has just been finalized by the EU, member countries with large road transport sectors have already filed for the suspension of the measures. These countries, including Bulgaria, Hungary, Poland, and Romania, are citing the economic impact of the additional measures to local businesses, potentially leading to heightened unemployment and sector shrinkage due to the increased costs associated with the mobility package. The ruling by the Court of Justice of the EU is expected later this year.

Our experienced team can help you maximize the impact of your position in the European decision-making process and put you in an advantageous position to achieve your agenda.

IV. EU regulation of artificial intelligence

In April 2021, the European Union unveiled a new benchmark regulatory framework on artificial intelligence (AI), with the aim of specifying the use of AI systems and addressing risks and accompanying concerns about the technology. This first ever attempt to enact horizontal regulation of AI seeks to codify the standards of the EU trustworthy AI paradigm, requiring legal, ethical, and robust artificial intelligence application.

The approach taken by the European Commission is one of risk-based assessment and classification of artificial intelligence use. Limited risk systems, for example, operating with human contacts such as chatbots or biometric categorization systems, would be subject to a limited set of transparency obligations under the new law. High-risk systems, on the other hand, such as ones operating with impact on human safety or fundamental rights, would face strict regulation, transparency requirements and regular auditing procedures.

As of November 2021, the legislative proposal is awaiting a draft report on the European Parliament and European Council, followed by the vote and trialogue on the text. Seeing as this proposal is the first of its kind, the developments in this sphere will have major influence on shaping legislation of AI worldwide. And while there is general support towards the commission proposal, experts and stakeholders alike are already calling for amendments and revisions of the benchmark legal framework.

Alber & Geiger can use its expert team on legislative matters to strengthen your position and capitalize on AI related projects, setting international standards under the new legislation.

V. EU to assess grocery delivery services

On-demand grocery delivery services such as ‘Getir’, ‘Gorillas’, or ‘Flink’ are increasingly coming under pressure by both National and Regional Lawmakers. These ultra-fast delivery services saw dramatic growth during the last few years due to the corona pandemic. Lockdown regulations and fears of getting sick popularized these services, promising grocery delivery, sometimes within 10 minutes of ordering. The growth of such companies, however, also led to the emergence of ‘dark stores’, distribution hubs for these services in and around popular neighbourhoods.

All over the European Union, cities have taken increased notice of these dark stores, with both citizens and authorities complaining about the nuisance and hazards these distribution hubs pose. Constant restocking of the de facto warehouses, noise and heightened traffic hazards are only some of the issues cities are experiencing, leading to growing discontent. An increasing number of cities have now taken measures against such services. Amsterdam and Rotterdam for example, have issued a one-year freeze on the opening of new dark stores, halting the growth of the expanding companies. The French city of Lyon further denied the opening of dark stores entirely in 2021, citing disturbances of public space and safety.

The current situation clearly mirrors the initial emergence of services like Uber and Airbnb a few years ago, and cities will likely follow suit when it comes to protecting local interest. On an EU scale, there has been little coherent reaction, although the companies involved have already voiced the desire to expand all throughout the union. It can be expected that these delivery services will heavily advocate for the benefits of their services and positive effects on employment and consumer choice, however, some companies have already noted their willingness to cooperate and find mutually acceptable solutions with European Cities.

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.

VI. EU targets alcoholic beverages

The European Union’s flagship food policy, the Farm to Fork (F2F) strategy, has taken large strides towards the ideation and implementation of greener and more sustainable food policy, both in terms of producers and consumers. Harmonized food labelling has, of recent, been part of that discussion. However, proposals for implementing nutritional score labelling on alcoholic beverages containing over 1.2% alcohol has caused increased attention to the topic.

Pushback against universal food labelling initially came with the conception of the Nutri-Score system in 2017 by France. The system was initially introduced to provide clear information to consumers to choose healthy and sustainable diets, by placing a five-colour nutrition label on the front of food packages, ranging from ‘A’ as a good nutritional score, to ‘E’ as a bad score. Since its launch, however, the Nutri-Score system has received harsh criticism because of its ambiguity, potential for manipulation and simplification of nutritional data.

In the latest proposal by the creator of Nutri-Score, alcoholic beverages, which under the 2011 regulation are exempt from providing nutritional declaration, should receive an ‘F’ label on the score system, thus giving it its own last place category. Multiple countries, headed by Italy, as well as anti-Nutri-Score lobby groups, have now come together and voiced their discontent, reiterating the previous flaws of the scoring system and now adding the threat of damaging the European Wine sector.

With the rising pressure on the French system, other labelling schemes, such as Italy’s ‘Nutrinform’ have gained momentum, with advocates placing emphasis on consumer education and scientific data. It is expected that the European Union proposes a universal food labelling policy as part of the F2F strategy in the fourth quarter of this year, but which system prevails is not clear of yet.

Alber & Geiger can aid in the protection of the heritage rich wine industry and use its extensive experience to direct EU opinions towards more suitable solutions.

III. A&G Newsletter Q4 2021

I. EU to target pesticides and artificial fertilizers

Within its agenda for the plenary session from 18 to 21 October 2021, the European Parliament is set to debate the Commission’s Farm to Fork strategy and vote on its own-initiative report. The draft report was adopted in September 2021 after heavy amending following the opinions of sceptical MEPs within other committees. Although the Parliament’s decisions will not be legally binding on this occasion, they will signal how much momentum lies behind the Commission’s plan among lawmakers, and what compromises can be expected.

The file touches upon fiercely debated provisions such as potentially mandatory nutrition labels on the front of food packaging, a statement that industrial-scale farming increases the risk of zoonotic viruses jumping to humans, or a mention to Europeans’ excessive meat consumption. Critics have raised the alarm over potential negative spill overs from the EU’s new farm policy such as a drop in food production leading to a loss of competitiveness for European farmers along with a mere exporting of the environmental damage of food production. A report by the Commission’s own research service allegedly identified such risks as real possibilities, which prompted fierce criticism from MEPs leading to the plenary vote.

The Commission itself has stressed in its responses to parliamentary questions that targets within the Farm to Fork strategy – i.e., to halve pesticide usage by 2030, dramatically curb fertilizers, and ensure that a quarter of EU farmland is organic – are aspirational guidelines that will depend on the adoption and transposition of over 27 individual measures. These will include the ordinary review and impact assessment procedures of the sustainable use of pesticides directive or the Common Agricultural Policy, which means the political battle is far from over and will be long and arduous.

Alber & Geiger can use its extensive experience representation of agribusiness to strengthen your position in the legislative process.

II. EU to target connected devices in push for enhanced cybersecurity

The 2021 State of the Union Address also saw the European Commission announce an initiative to raise the cybersecurity requirements for digital services employed in critical sectors of the economy and society. The initiative will build on the existing proposal for a Directive on Security of Network and Information Systems (NIS2) that is currently processing through stages at the European Parliament. Boldened security standards for smart devices commonly used by European consumers is welcome by many, with a significant number of voices having raised the alarm over the lack of provisions to this effect.

The revision of the NSI2 is expected to update the regulatory framework and ensure that key manufacturers of connected devices, believed to often disregard cybersecurity as a selling point of their products, implement high standards in the protection of the users’ data across different devices. The creation of a European network of Security Operation Centres is also expected to regularly scan the network using artificial intelligence technologies to detect cyber threats. Lastly, the commitment to create a Joint Cyber Unit presented last June was reiterated with the objective of coordinating and setting up a European crisis management capability in the cybersecurity space.

There are a significant number of voices among Europe’s digital industry who had already underlined the lack of baseline cybersecurity requirements, pointing out insufficient existing rules and calling for a horizontal regulation. However, a call for caution about proliferation of EU proposals to regulate the cyber environment has also been made. Many believe that Europe needs more harmonized targets and easily implementable rules to achieve the right protection for Europeans while helping the domestic industry build cyber security capabilities at scale while retaining competitiveness and profitability.

Our expert team can help influence opinions and agendas on EU digital policy matters at the highest political level.

III.EU to review waste management rules

As the EU’s Circular Economy Action Plan materialises into concrete measures, the remainder of 2021 has some important developments in line concerning the regulatory framework of waste management. Before the end of year, the European Commission is expected to come up with a proposal for a regulation set to replace the Packaging and Packaging Waste Directive as the previous impact assessments and public consultations have led the European Commission to believe the current regulatory framework falls short of delivering on environmental targets. The European Commission has equally announced that a review of the Waste Framework Directive is underway with the start of a public consultation scheduled for the second quarter of 2022.

In a high level of ambitions scenario, the new rules could require all packaging to be reusable or recyclable under a new and enforceable definition of re-usable packaging. In certain applications where alternative reusable productions or systems are possible or consumer goods and be handled safely without packaging, forbidding the use of certain packaging materials and polymers is being considered. Producer Responsibility Schemes whereby businesses placing any kind of packaging on the single market ought to be directly involved in the collection and recycling of packaging waste are already meant to be fully operational by 2024.

Many welcome the revamp of the packaging and waste rules as key area to deliver tangible results on the Green Deal’s environmental goals. The European Parliament has reiterated its objective to make all packaging reusable or recyclable in an economically viable way by 2030 in. a resolution from February 2021. However, some voices have called for emphasis on the cost effectiveness and the preservation of competitiveness aspects in an already heavily regulated sector as the different proposals will process through stages at the EU’s co-legislating institutions.

Our team can guide you through the legislative changes being considered to maximise the impact of your positions in the European decision-making process, and to put you in a position to benefit from them.

IV. EU to boost local semiconductor industry

A European Chips Act was pitched by the European Commission during the annual State of the Union address aiming to increase Europe’s self-reliance and competitiveness in an increasingly critical industry. Its implications can be vast and range across many industries including the automotive, computer or home appliances sectors.

The idea is still at a very infant stage without a concrete date for a proposal from the Commission nor any mention in the 2021 work program. However, further steps can be expected in 2022 if the ambitious objective of boosting Europe’s share of semiconductor production to 20% by 2030. The momentum for introducing provisions to that effect has been building up in the face of persistent shortages and supply chain disruptions during the Covid-19 pandemic. As a result, there are now a significant proportion of voices who believe the issue goes beyond business considerations and touches the core of Europe’s geopolitical and technological sovereignty, making it a priority at a time of European growing “strategic autonomy”.

The European Commission has laid down three core areas where to expect EU action. First, a European semiconductor research strategy would aim to build up on already existing first-rate research capacity and aim to align it with European strategic interests and ambitions. Secondly, a collective plan to enhance European production capacity by directly supporting the creation of large-scale fabrication plants capable of producing the most advanced and energy-efficient semiconductors. Last, a framework for international cooperation and partnership with the aim to secure European supply chains through both diversification and creation of domestic capacity. A plethora of financing sources can be expected at both European, national, regional, and private level, as well as a potential dedicated European Semiconductor Fund.

Alber & Geiger can use its extensive experience in EU affairs to strengthen your position to capitalize from projects such as these.


V. EU to update emissions standards for vehicles

The European Commission is expected to come up with a proposal for a regulation on emissions standards for all petrol and diesel cars, vans lorries and buses. The so-called Euro 7 regulation concluded its public consultation period in late 2020 and will be proposed to Parliament and Council before the end of 2021. Although Euro 7 is widely perceived as a key tool to deliver on the EU’s Green Deal emissions reduction targets coming from the transport sector, concerns have been voiced over an excessive level ambition potentially trumping the competitiveness of Europe’s automotive industry.

A key area where the regulation is meant to improve on its predecessors Euro 6 and VI is the monitoring of real-world emissions from vehicles for their lifetime on the road. Measurement of on-road pollutant emissions data currently goes through post-processing, which averages emissions during accelerations and excludes some relatively high emissions of heavy-duty vehicles, particularly in urban traffic. Many thus believe that measurement should target actual tailpipe emissions during a vehicle’s daily use for a comprehensive depiction of emissions according to driving circumstances. Provisions to this effect are envisaged should the Commission opt for the highest-level of ambitions course of action.

The two more moderately ambitious alternatives currently on the table consider stricter limits on CO2 and NOx as well as the inclusion of harmful ultra-fine particles (PN10), ammonia (NH3) and nitrous oxides (N20) that were previously excluded from measurements of vehicle emissions. Furthermore, hybrid cars could also be forced to drive in electric-only mode in certain locations. The proposed regulation is expected to be adopted by 2025 after the proposal has gone through the usual back and forth between the EU institutions.

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

VI. EU-US Trade and Technology Council

There was a great deal of enthusiasm over the EU-US Trade and Technology Council (TTC) inaugurated on 29 September 2021 for a much-needed revival of transatlantic cooperation in a host of issues from the fight against climate change to the challenges of the technological revolution. Although the meeting in Pittsburgh was just the first of many encounters, it set the tone for how Brussels and Washington want to cooperate and pursue mutual interests. The event sent a strong signal of the two sides’ renewed wishes for an enhanced partnership and the need to overcome differences in the face of mounting global challenges.

The sheer size of the EU-US economic relationship only is enough cause to pursue the benefits of a closer partnership. Together, they account for a quarter of global trade and almost half of global GDP. It is no surprise that the business community welcomed the TTC with open arms as the first step towards building a reliable institutional framework for business opportunities to take full advantage of the transatlantic relationship’s tremendous potential to that effect. The ten working groups are now expected to advance their work and align shared trade and technology priorities on areas such as common technology standards, supply chain security, or data governance.

For the TTC to turn into a complete success, much of the work ahead will need to iron out the two bloc’s differences in some thorny issues. Chief among the contentious points is data protection regulation, where the EU’s notoriously strict standards have already prevented both sides to reach an agreement in the past whereby full disclosure of personal data between companies and organisations could take place with safety guarantees. Yet, officials insisted differences in some areas will not trump progress in others. All eyes are now on the TTC as a potential enabler of the Transatlantic Trade and Investment Partnership (TTIP)’s revival.

Alber & Geiger can put its distinguished internal relations team at your disposal to help you further understand and influence the current state of EU-US relations.

IV. A&G Newsletter Q3 2021

I.EU to target pre-installed phone applications

The Digital Marketing Act (DMA) is currently processing through the stages at the EU Parliament level. Much like the GDPR, the DMA will have direct effect throughout all Member States and is intended to be a revolutionary piece of legislation for the modern technological age that seeks to protect consumers from some of the unsavoury practises of the multi-national tech giants. Amongst the proposals for reform being looked at currently are measures, which would prevent these corporations from pre-installing their own applications such as Google Chrome or Microsoft Outlook onto every one of the individual devices manufactured by them.

There are a significant proportion of voices who believe that the capacity to do this affords these huge corporations with a disproportionate competitive advantage, which leads towards them behaving like oligopolies, given in practise how so few phone users reconfigure these basic applications once they have begun using each device. The momentum for introducing provisions to this effect in the DMA has been accelerated by pronouncements on the part of both the Body of European Regulators for Electronic Communications and the UK Competition Authority, where both voiced concerns about the impact on effective choice for consumers by allowing these corporations to continue pre-install their own applications.

Many believe a decision to introduce provisions to this effect would be a positive step in tandem with other efforts by the EU to cut down on oligopolistic tendencies on the part of these corporations. In this respect many would point to the decision by the EU Commission to fine Google more than €4 billion in July 2018 for their practise of allowing the biggest manufacturers to exclusively pre-install Google products on their devices. Many also believe legal provisions to this effect would enable consumers and broader society to effectively tackle the data harvesting business models of corporations such as Google, which largely rely on the consumer’s use of their pre-installed applications.

Alber & Geiger can use its extensive experience in EU affairs to strengthen your position in the legislative process.

II.EU to targets anti-competitive foreign subsidies

In May 2021, the EU Commission announced plans through which legal instruments would be introduced to prevent the practise of third countries affording subsidies to many of its successful companies within the EU Single Market, which had the effect of negatively distorting competition.

In the White Paper released by the EU Commission, it suggested that three different tools would be implemented which would empower authorities to identify, investigate and penalise subsidies of this nature. These tools would be specified to distinguish between differing sorts of subsidies such as those in the sphere of mergers and acquisitions, those which generally facilitate the gaining of competitive advantages for companies as a result of subsidies, and those which distort public tenders.

This latest White Paper follows a similar trend from summer 2020, when EU Competition Commissioner also presented a white paper detailing the EU Commission’s plans to level the playing field with regards anti-competitive subsidies. The overarching goals of both these plans is to solidify a means of redress for honest EU companies being put a financial disadvantage as a result of these practises by third country governments. There is some concern, however, in the wake of the publication of the White Paper that the three differing instruments will have the effect of creating loopholes, confusing overlaps and could ultimately create more legal uncertainty. There are also concerns regarding the ultimate effectiveness of these tools given the likelihood that much of the relevant evidence in these investigations will be located beyond the EU’s jurisdiction. The consultation period on the proposal closed in mid-June 2021, and could ultimately take up to two years to be fully ratified by the Council of the EU and the EU Parliament.

Our expert team can help influence opinions and agendas on EU competition matters.

III.EU to support geothermal technology

The Renewable Energy Directive first drafted in 2009, has long been the showcase legislative instrument through which the EU has demonstrated its commitment to creating ambitious reforms throughout the EU with respect to climate action. The Directive in its original form contained policy initiatives and guidance that sought to ensure that the EU would reach its goal of 32% of energy coming from renewable sources by 2030. The Directive was recast in 2018 shortly in the wake of the agreement of the Paris Climate Accord. Whilst in many respects the Directive has been successful, many in the geothermal energy sphere has been left disappointed by the Directive’s effectiveness in terms of encouraging use of this form of renewable energy.

However, in the wake of proposals under the European Green Deal, consideration is once again being given to revisiting the Directive with the aim of removing the many structural barriers that exist with regards to harvesting geothermal energy. These barriers are significantly acute in terms of the costs that exist for producers regarding exploration and drilling. Two key features of a yet again recast Directive that could help to reduce structural prices include provisions for de-risking measures and power purchase agreements (PPA).

PPAs, in fact, seek to reduce the burden that is placed on businesses alone in engaging in the sophisticated and risky work associated with harvesting and creating the necessary infrastructures associated with geothermal energy. A PPA would have the potential to create a balanced funding environment, whereby businesses would at first pay for the installation and maintenance of the necessary harvesting infrastructure. That said, there would also be a firm contractual commitment on the part of consumers to pay for this energy normally over the course of a contract lasting decades.

Our team can guide you through the legislative changes being considered in order to maximise the impact of your positions in the European decision-making process, and to put you in a position to benefit from them.

IV. EU approval of the Covid recovery fund

May 2021 saw the final approval given to the historic €672 billion EU Covid recovery fund (composed of grants and loans) that was agreed on by EU leaders in July 2020. The simultaneous ratification of the “Own Resources Decision” will enable the EU Commission to finance the fund by the EU Commission borrowing directly from the money markets on behalf of the EU as a whole, and later distributing its borrowing to Member States. It is envisaged the borrowing will be repaid by 2058.

Since the point of agreement at an EU Council summit last summer the specifics of the agreement has been debated and scrutinised by the parliaments of the respective Member States in the intervening time. In Poland in particular, approval of the project was significantly delayed by disagreements within the ruling coalition as to how exactly to distribute the fund internally within Poland. Disappointment may well exist within some quarters of the EU given the almost year long delay that has followed between agreement and final approval, particularly in the face of the urgent circumstances caused by the pandemic. Disappointment may well also exist that the fund has already been somewhat diluted from the original figure of €750 billion to €672 billion.

However, now finally with the ratification of the Polish and Austrian parliament all pieces seem to be in place to ensure that the fund will begin being distributed from this July. Large proportions of the fund will be earmarked for larger EU economies that took significant heavy hits during the pandemic such as Italy, France and Spain. The fund (like its US equivalent) also provides significant business opportunities to implement modern reforms to economies such as the ring fencing of 37% of the fund for projects related to climate action, and a further 20% will be targeted at smoothening the transition to a new digital economy.

Alber & Geiger can use its extensive experience in EU affairs to strengthen your position so as to capitalize from projects such as these.

V. EU-China investment agreement

In May 2021, the EU Parliament voted overwhelmingly to halt any legislative progression of the Comprehensive Agreement on Investment (CAI) that had been agreed between China and the EU until such point that Chinese officials agreed to lift sanctions they had imposed on five MEPs. These sanctions are regarded as a reaction to sanctions imposed by the EU Parliament on Chinese officials believed to be connected with the internment of the Chinese Uyghur population in conditions that fall far below human rights standards.

The halting of the CAI ratification process is indeed a considerable blow given that the deal was only agreed in principle as recently as December 2020. It had been hoped that the CAI would prove a significant milestone step in the amelioration of trading relationships between the EU and the traditionally protectionist Chinese markets. Under the terms of the CAI, China had agreed to allow much more external access to their markets and had also agreed to provisions which would seek to create a more levelled trading relationship between the EU and China, in addition to provisions which would commit China to improving their sustainable development mechanisms and improve their labour rights laws.

This stalling of ratification of the CAI looks unfortunately like it could well be a pro-longed delay, given how intrinsically such a deal is connected to the broader geo-political facts relating to EU-China relations. Neither side in their comments so far seem prepared to compromise first over the lifting of the sanctions, and hence the future of the CAI currently is very much uncertain.

Alber & Geiger can put its distinguished international relations team at your disposal to help you further understand the current state of EU-China trading relations.

VI. EU Commission to reduce carbon heavy imports into EU

In June 2021, media outlets received leaks indicating the EU Commission’s plans to reduce carbon imports into the EU by placing tariffs on goods, which traditionally carried large carbon footprints. Many of these goods are related to the construction and infrastructure sectors of the global economy such as steel, cement and electricity. The obtained information suggested that these tariffs will be manifested through a tool known as the carbon border adjustment mechanism, which will be formally presented to the public by the EU Commission in mid-July.

It is hoped that the introduction of these tariffs will help facilitate the EU as a whole in matching the carbon reduction ambitions of many of its competitors. It is expected that the EU Commission will emphasise that exemptions from the tariffs will be made for both EFTA Member States within the Customs Union such as– Iceland, Liechtenstein, Norway and Switzerland, and for economically developing countries. The tariffs, therefore, will predominantly be designed to penalise imports from developed countries who have chosen not to take similar wide ranging steps to reduce their carbon prints, so hence there is no guarantee that such goods coming from close EU partners like the United States or the United Kingdom will be exempt from these tariffs.

EU based companies importing these kinds of targeted products are expected to be required to obtain digital certificates, which contain a record of the carbon emissions on the products they are importing, thereafter tariffs will be placed on imports with a suitably high carbon foot print. This obligation to obtain this license will be an additional obligation in this area, given that EU based power companies are already required to obtain permits for work that generates large amounts of carbon emissions. The cost of these certificates are expected to be closely linked to the pre-existing permits. These plans are expected to be phased in on a gradual basis from 2023, and will be fully operational from 2026.

Our experienced team can help influence opinions and agendas.

V. A&G Newsletter Q2 2021

I. Council to go ahead with the country-by- country reporting directive

On February 25, the Portuguese Presidency of the Council of the European Union earned widespread support from member states to advance with the European public country-to-country reporting directive. The directive aims to require multinational corporations to publish their profits and taxes paid in each EU member state in which they operate.

Overall, the directive aims to construct a new oversight regime that identifies instances of corporate tax avoidance in Europe. While businesses do favor transparency, they are also concerned that making profits public would harm their competitiveness. In fact, many businesses feel that the EU decision to move ahead will not necessarily help assess tax liabilities properly. They argue that it would be a duplication of the work carried out by the tax authorities, which will harm the level playing field on top.

The directive is expected to enter the legislative process later this summer, with trilogue negotiations between the Commission, Council, and Parliament planned for June. While a portion of the directive has been agreed to, the Council and Parliament are still grappling over the intensity of the directive’s transparency rules and have considerable disagreements to reconcile.

Alber & Geiger can defend your interests during the legislative process.

II. Commission to present digital tax proposal

The Commission is expected to present its proposal establishing an EU-wide digital tax this coming June – a long anticipated centerpiece of the Commission’s digital and economic strategies. Following the recent change in US administrations, with the Biden administration signaling a favorable stance toward the issue, momentum for creating international standards on a digital levy has built steadily. The development is of particular significance for larger technology firms, as these entities would be most affected by an EU-wide digital tax.

While the Commission has expressed it preference for an agreement within the OECD to establish an international digital tax framework, this preference has not halted the Commission from coming forward with its own proposal. Executive Vice President of the Commission Margrethe Vestager recently noted that while the proposal aims to be tabled in June, a digital tax will not become operational until 2023.

However, a select grouping of Member States, as well as several multinational corporations and business associations, are poised to oppose the Commission’s effort, instead preferring such a framework be crafted within the OECD.

We can assist technology and telecommunications firms achieve their legislative and regulatory goals in the EU.

III. Commission to bolster promotion of EU agricultural products

Promoting EU agricultural products is a clear priority of the Commission’s annual work program. In 2021 alone, the Commission will spend €182.9 million to promote European agri-food products within the Single Market and abroad. Having launched a public consultation on the review of such policies, the Commission has created the opportunity for stakeholders to shape the way in which certain key goals take form. The consultation period is currently open and will remain so until June 23.

First and foremost, nearly half of the Commission’s budget in this policy area (€86 million) will be tethered to the objectives of the European Green Deal, supporting schemes for organic products, best practices in sustainable agriculture, and other aspects of reforming the agri-food industry to better fight climate change. Additionally, an important part of the consultation will concern defining safety standards of EU agri-food products, as well as a range of quality schemes.

With regard to external markets, the Commission has placed a clear priority on high-growth markets. In particular, Canada, Mexico, Japan, and South Korea have been viewed as targets for specific EU exports, namely those from Europe’s dairy, olive oil, and wine sectors.

Our experienced team can help influence opinions and agendas.

IV. Commission reviews key aspects of Banking Union

In launching its consultation on the review of bank crisis management and deposit insurance framework, the Commission aims to present a proposal for a regulation that establishes a set of policies for handling bank failures and better protects depositors. The consultation, open now until May 20, allows stakeholders to influence a critical institutional development in the landscape of the EU’s financial sector, as well as to shape the broader contours of debate on the Banking Union. Specifically, the consultation concerns three legislative texts: the Bank Recovery and Resolution Directive (BRRD), the Single Resolution Mechanism Regulation (SRMR), and the Deposit Guarantee Schemes Directive (DGSD).

At its core, the forthcoming regulation is expected to shield public monies from bank failures, instead diverting the burden of institutional insolvencies to the shoulders of the broader banking industry. Thus, the consultation is of particular importance to credit institutions, investment first, electronic payment platforms, as well as relevant national financial bodies and agencies.

Alber & Geiger can get your message to the appropriate audience.

V. Suspension of Boeing-Airbus tariffs positions transatlantic trade talks to reopen

After years of punishing each other for subsidies granted to Airbus and Boeing, the EU and US agreed on March 5 to suspend their retaliatory tariffs for four months. The removal of these tariffs will affect billions of dollars in goods, ranging from tractors to wine to cheese.

Trade Commissioner Valdis Dombrovskis labeled the move as a “reset” for transatlantic relations meant to provide an opportunity to create a “comprehensive and long-lasting negotiated situation.” With transatlantic trade talks expected within this four-month timeframe, the EU agricultural sector will benefit heavily during the suspension period. To ensure retaliatory tariffs don’t reemerge after the suspension period, the agricultural industry should take serious interest in engaging in the negotiation process to ensure EU-US trade disputes on aircraft subsidies are settled.

Moreover, Europe’s aim for enhanced transatlantic cooperation can be seen in its proposal to establish a Trade and Technology Council comprised of US and EU officials.

Our trade team enjoys long-lasting relationships and understands the complexities to help shape decisions.

VI. Commission advocates for tougher, greener approach to trade

On February 18, the EU’s trade Commissioner Valdis Dombrovskis announced that Europe’s trade policy will regard the commitments delineated in the Paris Climate Accord’s as “essential elements” in all future trade deals. Additionally, the EU’s new trade approach will look to liberalize trade in green products and services while also brokering agreements to reduce third country subsidies of fossil fuels. Recent evidence of this trade approach can be observed in the Commission’s promise to delay ratifying the EU-Mercosur deal unless Brazil steps up its environmental commitments.

Furthermore, the Commission will look to develop a new mechanism to defend the EU from prospective coercive and distortive maneuvers from third countries. Potential mechanisms could include the establishment of an EU export credit facility, an office of a chief trade enforcement officer, and upgraded enforcement regulations.

Alber & Geiger can help third countries navigate the trade environment and advance their goals in Brussels.

VI. A&G Newsletter Q1 2021

I. EU establishes Capital Market Union

With the publication of the Capital Market Union Action Plan, the EU Commission has defined the roadmap for the unification of the European capital market. The EU Commission’s policy has three objectives: to support the objectives of the Green Deal; to encourage individuals to invest in long-term projects; and to unify national markets by tackling regulatory barriers.

In more detail, the EU Commission schedules more than 16 targeted actions to achieve a unified capital market. Among the actions planned by the EU Commission are a harmonisation of the shareholders rights, a strengthening of investment protection rules, a review of the security rules and the unification of insolvency rules. In addition, the EU Commission will promote individual investment in pensions and long-term investment, including through reform of financial reporting.

The EU Commission has set the roadmap for its banking and financial policy for the years 2021 to 2024. The action plan presented is already taking concrete form, notably with the opening of public consultations on long-term investment funds. It is essential for companies of the banking and financial sector to strengthen their presence at the European institutions in order to provide their input into the development of the Capital Market Union’s action plan.

Alber & Geiger can put its expertise in European affairs at your disposal in order to make your position in the European institutions prevail.

II. EU to regulate digital finance

The digitalisation of the financial sector has been identified as a priority for the EU Commission, which in the coming months will adopt forward thinking actions to prepare the future of the digital sector. The digital strategy for the financial sector outlines the EU’s actions and ambitions for the coming months and years.

Concretely, the strategy has four main axes: tackling the fragmentation of the digital single market for financial services, reviewing the regulatory framework to make it fit to the digital transition, promoting data-driven innovation, and addressing the challenges linked to the sector digitalisation. Several regulations to this effect are already in the making, in particular a directive on crypto-assets which aims to establish a tailor-made regime for economic operators, new rules for IT services to prevent the risks of cyber-attacks, as well as a new strategy for retail payments.

With the adoption of this strategy, the EU Commission has set itself a roadmap that schedules a thorough overhaul of the legislation and regulatory framework of the financial and digital sector. These regulations are going to have an important impact on the European and international financial sector, so it is vital for companies concerned to engage with European decision-makers.

Alber & Geiger can use its extensive experience in EU affairs to strengthen your position in these regulatory procedures.

III. EU presents greener and more digital consumer law

By presenting its new Consumer Agenda, the EU is laying the foundations for its vision of consumer policy until 2025. The Communication schedules more than 22 actions aimed in particular at helping the green transition and adapting legislation to digital commerce. It is also scheduled to strengthen the enforcement of consumer rights and enhance international cooperation.

In more detail, the EU Commission will take regulatory measures to change the information rules with the explicit aim of combating greenwashing. It is also scheduled to revise the directive on the sale of goods in order to give a right to repair to consumers, as well as to revise the general directive on product safety. In addition, the EU Commission will boost the international dimension of its consumer law: it plans to strengthen collaboration at multilateral level, but also at bilateral level as an action plan with China is listed as the EU Commission’s priority.

In less than 5 years, the EU Commission intends to re-evaluate almost all of its consumer legislation in order to strengthen its role in the green transition and adapt it to the changes brought about by digital technology. the EU Commission will take measures that will change consumer law, which will have an impact on the entire goods and commerce industry, including the digital sector. It is central for the sectors concerned to participate in the review of current regulations as well as in the development of future regulations in order to shape the new European consumer law.

Our team can guide you through the regulatory review process in order to maximise the impact of your positions in the European decision-making process.

IV. EU adopts Class Actions

On 24 November, the European Parliament adopted the Collective Redress Directive (CR Directive), ending a process started in 2018 following the “Dieselgate”. The CR Directive defines the minimum criteria for adopting class actions throughout the EU.

In concrete terms, the CR Directive allows consumer associations to collectively sue companies that have caused them harm through the class action mechanism. Class actions may be brought in all areas relating to data protection, financial transactions, travel and tourism, energy, communication and all infringements of general consumer law. Unlike the US, EU class actions will not be able to seek punitive damages and will have to be limited to repairing the damage, but at the same time the costs to the plaintiffs will be limited in order to promote its use. Another limitation is that only consumer associations with a recognised interest in the field may be qualified entities able to launch class actions.

In summary, this directive heralds an important change in European consumer law by encouraging the use of class actions. Member States are free in defining the mechanisms at national level as the Directive sets only minimum standards. Member States have up to two years to define the class action procedures and these must be applicable at the latest 6 months after this deadline. The EU in the midst of a major paradigm shift in the field of consumer protection and large portions of the economy are potentially concerned by future class actions.

Our expertise will enable you to make your interests prevail here.

V. The EU Digital Service Act (DSA)

By introducing the Digital Service Act (DSA), the EU Commission announces a radical change in the way digital services operate and in their liability rules. The aim of the EU Commission is to make the major digital services more transparent and, above all, more active in the fight against illegal content by increasing the liability rules of the digital services.

The DSA redefines the transparency obligations of digital services as they will now be obliged to provide more information at the request of users about targeted advertisements. The biggest change, however, are in the liability rules for digital services. The prevailing rule was that services were hardly ever liable for hosted content. From now on, digital services may be sanctioned for hosting illegal content, unless it is proven that they have acted expeditiously to remove this content. Digital Service Coordinators will be established at the national level to monitor the internal procedures set to improve the removal of illegal content.

All the digital services of more than 45 million users are directly concerned by the DSA, which will radically change the way they operate. If they do not comply with the new regulations, the penalties may be as high as 6% of total business income. The DSA will have an unprecedented transformative impact on the way digital services operate.

Our expertise in EU affairs and our contacts with the EU institutions and Member States will enable you to represent your interests in the forthcoming discussions.

VI. The EU Digital Market Act (DMA)

The ambition of the EU Commission with the Digital Market Act (DMA) is clear: to force the Large Online Platforms (LOPs) to change the way they operate as it aims to remedy anti-competitive practices. It is set to be the most important and ambitious regulation in the digital field for years.By introducing the Digital Service Act (DSA), the EU Commission announces a radical change in the way digital services operate and in their liability rules. The aim of the EU Commission is to make the major digital services more transparent and, above all, more active in the fight against illegal content by increasing the liability rules of the digital services.

In concrete terms, the DMA consists of two pillars: an ex-ante list of prohibited or strictly regulated practices, and a Market Investigation Tool. This ex-ante list will be divided into several categories. The blacklist simply prohibits a number of practices, such as not sharing the collected data with third parties, the collection of data beyond what is necessary and limitations on self-referencing. The Market Investigation Tool should enable the Commission to enrich the ex-ante list of prohibited practices as well as the list of LOPs. Although DMA focuses on LOPs, we are on the verge of a radical change in the functioning of the digital market as a whole.

The DMA aims to change the structure of the digital market by strengthening the EU Commission’s anti-trust powers in an unprecedented way. The first companies concerned are the LOPs, which will have to change some of their practices in depth. These LOPs are the GAFAMs, but all platforms with significant market power are also potentially concerned. Other smaller digital companies are also concerned as they will now be able to challenge anti-competitive practices much more easily and with faster effects.

With a proven track record of success, Alber & Geiger can help you bring your case directly to European decision-makers.

VII. A&G Newsletter – Q4 2020

EU Commission to shape and evaluate national recovery plans

The EU has put forward an exceptional tool to finance the recovery of the European economy, the Next Generation EU (‘NGEU’). The NGEU includes the EUR 672.5 billion Recovery and Resilience Facility (‘RFF’) financial instrument which will be allocated directly to Member States to fund their national recovery plans. However, these funds come with strings attached.Indeed, Member States will have to define Recovery and Resilience Plans to be submitted to the Commission for approval between October and April 2021.

More concretely, the national plans must include structural reforms, be in line with EU policy priorities and have more than 30% of the funds dedicated to climate action. The national plans must be designed to achieve 7 objectives set by the Commission. It is on the capacity of the national plans to achieve these objectives that the Commission will make its assessment. These objectives include investments in renewable energy, clean transport, connectivity and the development of the technological capacities of European industry. The influence of the European Commission will continue even after the adoption of the Recovery Plan, as the release of payment instalments is linked to the achievement of milestones monitored by the Commission.

The role of the European Commission in defining national recovery plans will be central. By setting the evaluation criteria and assessing the consistency of the national plans with EU policies, the Commission will be the co-author of each Member State’s recovery plans. With the national recovery and resilience plans potentially being finalised in the coming weeks, it is essential to lobby the Commission to make the most of the stimulus funds.

Our expertise in European affairs and our contacts with the Commission services will enable you to quickly establish a tailor-made lobbying strategy to shape the national recovery plans.

EU agrees on the budget for 2021-2027

At the European Council of 17-21 July 2020, the EU finally agreed on the next Multiannual Financial Framework (‘MFF’) amounting to EUR 1,074.3 trillion. In addition, EUR 72.5 billion from the NGEU will strengthen European programmes, particularly in research and innovation and cohesion. With the adoption of the MFF, the EU would set the EU’s long-term objectives from 2021 to 2027.In concrete terms, the MFF sets the EU budget in all its policy areas. The sectors concerned are agriculture, cohesion funds, the Green Deal, health, research and innovation programmes, digital and infrastructure investment. However, the EU has had to scale back some of its ambitions on some areas compared to the May’s proposal. Negotiations are still ongoing between the Council and the European Parliament. The European Parliament wants to raise European ambition in research and health programmes, which could increase the MFF by a further 110 billion EUR.

By adopting the MFF, the EU is setting its policy objectives for the long term. However, with debates in the European Parliament underway, pressure is mounting to raise the EU’s ambitions on certain policies. In this context, it becomes crucial for stakeholders to strengthen their influence with the European institutions and Member States to ensure that the NGEU and the MFF which will define European policy for the next 7 years, meets their needs in the best possible way.

Alber & Geiger can use its extensive experience in EU affairs to enable you to benefit from EU funds.

EU steps up its funding capacities

With the adoption of the new MFF, the EU is reforming and expanding its funding and guarantee programmes to meet the objectives of strengthening competitiveness and research & innovation. Horizon Europe comes out strengthened compared to the last MFF. The research funding programme gets EUR 80.9 billion, an increase of more than EUR 16.2 billion compared to Horizon 2020. In addition to this, a new EUR 8.4 billion InvestEU program is created.

Via Horizon Europe, the Commission can fund research and innovation programmes. Horizon Europe provides funding opportunities to many research sectors, such as health, digital, environment, energy and transport. The InvestEU programme both complements and expands Horizon Europe. The InvestEU programme aims to provide a financial guarantee for any project that would be too risky for the traditional market. It is then up to the Commission to choose to guarantee the projects submitted to it. Furthermore, the EU has asked the European Investment Bank (‘EBI’) to consider increasing its capital by the end of 2020.

In conclusion, the funding opportunities and the sectors concerned have been greatly expanded: research and innovation, infrastructure, strategic investment and climate action. The priorities of the funding programmes, the calls for proposals, the selection criteria, and the decision to guarantee projects are in the hands of the European Commission. Our teams can help you to set up a project that meets European criteria, but also, through contacts with the institutions, influence the priorities of the European funding policy.

Our teams will guide you through the funding programs and procedures.

EU launches infrastructure and digital programmes

The EU Recovery Plan and the MFF dedicate more than EUR 8.593 billion specifically to digital transformation. Indeed, the Connecting Europe Facility (‘CEF’) sets a new fund dedicated to digital, focusing on European infrastructures. The EU is also launching a brand-new Digital Europe Programme to invest in the digital transition and new digital technologies.

More concretely, the Commission is working on a multi-annual investment plan for the CEF. The funds should focus on 5G infrastructure and the construction of data centres. Digital Europe’s EUR 6.7 billion will be administered directly by the Commission, which will determine the investment priorities and award criteria. The fund aims to finance research & innovation in AI and to strengthen the competitiveness of the European cybersecurity industry. The funds are intended not only to encourage innovation, but also to help bring new technologies to the market.

Now that there is agreement on the MFF, the European Commission will define the framework for the CEF and Digital Europe in the coming month. It is at this crucial time that the digital sector, and more specifically the cybersecurity and AI developers and members of the data economy, to reach out to the European Commission to provide input to the definition of the programme frameworks. We can develop a narrative designed to shape the priorities of European programmes and subsequently help you identify and secure funding for your projects.

Our expertise will enable you to make your interests prevail with the European institutions.

EU sets new Neighbourhood and Development Plans

The new MFF dedicates more than EUR 98.419 billion to development programmes. The main countries concerned are the countries of Sub-Saharan Africa (EUR 26 billion), Neighbourhood (EUR 17,217 billion), but also the EU candidate countries which will benefit from the separate Instrument for Pre-Accession Assistance (‘IPA III’). The adoption by the Commission of the financing plans determining the allocation of funds between the States is scheduled for the coming months.

More concretely, the Commission plans to define multi-annual financing plans in collaboration with the Member States and the partner States. The aim of this consultation is to define the priorities of development policy and to determine the distribution of funds. The Commission will adopt multi-annual programmes through implementing acts using a performance-based approach. The more successful a state is in meeting the objectives previously set, the more funding it will receive.

With the new iterations of the development programmes, the EU is more than ever adopting a performance-based approach when it comes to defining the allocation of the development funds. This makes dialogue with the European institutions all the more important. Alber & Geiger can help you define a narrative illustrating the achievement of the objectives of the previous programmes and request an allocation of funds reflecting your ambitions and needs.

Alber & Geiger can put its distinguished international relations team at your disposal to help you make the most of European development programmes.

EU to Propose New EU-Wide Taxes

To finance the Next Generation EU, the EU is preparing to introduce new taxes at European level. These will have important consequences for all industrial sectors. In the plan published on 21 July, four new taxes are planned, the first of which will be introduced on 1 January 2021.
In addition, the European Parliament has called on the Commission to introduce further proposals for new taxes at EU-level.

From 1 January 2021, a tax on the weight of non-recycled plastic packaging will be implemented at the tariff rate of EUR 800 per tonne. In the first half of 2021, the Commission intends to introduce three new taxes which should be applicable from 2023. Public consultations for the Carbon Border Adjustment Mechanism have already opened and will end on October 28, 2020. Negotiations on the roadmap for the extension of the Emission Trading System (‘ETS’) to the maritime shipping and aviation sectors are also currently open. In addition, the Commission will propose a digital tax of 3% for companies with an income above the EUR 750 million threshold. Finally, the Commission plans to propose a financial transaction tax to finance the next MFF.

The taxes that are going to be proposed will have an impact on all European industries, and even in industries based in third countries trading with the EU. With the immense consequences they could have on all sectors of industry, adopting a strategy to influence the European institutions is more necessary than ever. Our expertise in European affairs and our contacts in the various European institutions will enable us to represent your interests in the best possible way and mitigate the effects of these new taxes on your activities.

Our expertise in EU affairs and our contacts with the EU institutions and Member States will enable you to represent your interests in the forthcoming discussions.

VIII. EU Marshall Plan of EUR 750 billion

After weeks of negotiations and rumours, the Commission finally presented its Recovery Plan on May 27th. The Plan provides for a new financing tool “Next Generation EU” of EUR 750 billion financed by a European loan, which had never been done before, and a Multiannual Financial Framework (‘MFF’) raised to EUR 1.1 trillion. The EUR 540 billion Coronavirus Relief Package announced at the beginning of April is added to the EUR 1.85 trillion Stimulus Plan to reach a total of almost EUR 2.4 trillion. By way of comparison, in 2009 the Commission launched a recovery plan of only EUR 200 billion.

The “EU Marshall Plan” heralds exceptional opportunities for companies doing business in Europe while at the same time strengthening the EU’s regulatory ambitions in the years to come. Indeed, more than 25% of the funds allocated will have to be earmarked for climate action in connection with the Green Deal. In parallel, the “Just Transition Fund” announced in January to help the energy transition was multiplied by 5, from 7.5 billion to EUR 40 billion. The Recovery Plan also provides for EUR 60 billion in guarantee funds that would trigger more than EUR 600 billion of private investment. However, companies deemed to be environmentally harmful will not be able to access these investments. To finance the investments, the EU plans to introduce new taxes such as a border tax on carbon, an enhanced emissions trading system and a tax on digital companies.

The EU Recovery Plan is delivering on its promises. The MFF is expected to be adopted in autumn 2020 so that the entire Recovery Plan can be operational by 1 January 2021. It is vital for companies to strengthen their presence in the EU decision making process in order to make the most of the opportunities offered by the Recovery Plan, while mitigating the risks linked to the EU’s regulatory ambitions, particularly in the digital and environmental fields.

Alber & Geiger’s extensive political and policy experience can help you promote your interests and assist you in securing the massive investments from the European Marshall Plan.

EUR 130 billion EU guarantee fund for Africa and the Western Balkans

The Recovery Plan presented on 27 May was also an opportunity for the Commission to revise upwards the ambition of its external action plan. In order to counter the effects of the pandemic, EU financial action will be stepped up in the coming months. The External Action Guarantee tool will receive EUR 10,5 billion from the Next Generation EU fund. These new funds will upscale its financing capabilities from EUR 60 billion in the 2018 proposal to EUR 130 billion. Most importantly, for the first time, the External Action Guarantee will be used to finance projects in the Western Balkans.

In the coming months the Commission will present a plan that will present which sectors and types of projects will be given priority to benefit from the External Action Guarantee fund. These projects will have to be aligned with European policies and ambitions in the digital and environmental fields. Financial institutions wishing to benefit from these guarantee funds will have to submit their application to the Commission services. Ultimately, it is the Commission which will decide which projects will be eligible for the guarantee fund. The Commission hopes that these guarantees will trigger up to EUR 500 billion of public and private investment between 2021 and 2024.

The revamped External Action Plan marks a turning point in the EU’s cooperation policy with third countries. In order to combat the effects of the pandemic, the Commission intends to trigger massive investments via the leverage mechanism of the External Action Guarantee Fund. The entire investment guarantee process will be in the hands of the Commission. African and Balkan states, as well as private operators, should strengthen their presence in Brussels in order to take full advantage of these exceptional financing opportunities.

Our expertise in European government relations will help you to secure these guarantee funds.

EU Standard for Platform Regulation

On 2 June 2020, the Commission opened the public consultation for one of the most ambitious regulations of the Digital Agenda: the Digital Service Act. The objective of the EU is clear: to reiterate what has been done with the GDPR and to define standards at the global level for digital platforms. The EU plans to act on content moderation in order to combat misinformation and hate speech online. In order to complete this reform of e-commerce rules, the EU is currently working on a new ex-ante competition tool specific to the digital economy that will strengthen the constraints on digital companies.

In more detail, the reform of the e-commerce directive is aiming at clarifying, harmonising and increasing liability rules for digital companies that dates to 2001. The Commission wants a framework at European level that would redefine the responsibilities of platforms in content moderation. The new competition tool that is to accompany the Digital Service Act aims to adapt the competition rules to the digital domain. This tool will strengthen the competition rules for large digital companies to keep them from acting as gatekeepers.

The EU has launched the first phase of its ambitious plan for a comprehensive regulatory reform of digital platforms and e-commerce. The whole sector is concerned, both for companies operating in the single market and those that do not as the EU is going to be very active in its efforts to globalise its regulations. The rules of responsibility to the competition rules are going to be totally reformed. The public consultations open until 8 September will be crucial for digital companies. The Digital Service Act is to be introduced in early 2021.

Alber & Geiger has extensive political and policy experience on this topic. Our team of experts can help you promote your interests during this process.

Reform of the European Pharmaceutical Sector

On 2 June the Commission published the roadmap for its ambitious pharmaceutical strategy. The Commission is to reopen all dossiers related to the pharmaceutical sector in order to make it more resilient, more competitive, more integrated and adapted to future technologies. The strategy has three main objectives: making the supply chain more autonomous, removing barriers to the circulation of treatments in Europe and adapting pharmaceutical regulations to new technologies. The ambition is to make the EU the leader in pharmaceutical research and to lay the foundations for international regulations on the quality and safety of medicines.

In concrete terms, the Commission foresees several legislative and non-legislative actions to achieve these objectives. The Commission will soon review the regulation on orphan diseases, the regulation on fees for medicinal products and reform the European Medicines Agency (‘EMA’). The Commission plans increase coordination between Member States’ health systems to reduce market fragmentation. These reforms may go as far as revising the basic pharmaceutical regulations which dates to 2001. As gene and personalised therapies and the use of AI data are increasingly common, the Commission will strive to ensure that the European pharmaceutical regulatory framework does not act as a deterrent to innovation.

The European Pharmaceutical Strategy is very ambitious. The EU is planning to review almost its entire regulatory framework and its research and innovation policy. There is a clear focus on facilitating research and innovation as well as facilitating access to new therapies. Above all, the Commission will act to unify the European pharmaceuticals market. Public consultations started on June 16 and will be concluded on September 15. It is crucial that all companies in the pharmaceutical sector are involved in the definition of this strategy.

The expertise of Alber & Geiger’s teams can guide you through the European decision-making process to represent your interests.

EU consultations on New Chemical Strategy

On 9 May, the European Commission presented the roadmap for its new strategy for reforming chemical regulations. The Commission plans to raise health and environmental protection standards. The Commission plans to simplify and make more transparent all European chemical regulations. The objective is to make the EU the leader in the production of alternative and sustainable chemicals by stimulating research and strengthening restrictions on products considered harmful to health and the environment.

Current discussions are focusing on strengthening the “polluter pays” principle by reforming the current liability principles. A new assessment methodology should be put in place to consider the effects of chemicals when combined with other products, as well as the duration of exposure. This may lead to a revision of specific regulations such as regulations on food packaging or toys. Certain chemical compounds, especially “endocrine disruptors”, are likely to be particularly affected. The Commission is working on increasing the coordination between national and European agencies in order to implement the “One Substance – One Assessment” principle. In addition, the EU should put in place incentive and funding mechanisms for research to encourage the adoption of sustainable alternatives.

The European chemical strategy for sustainability will have an important impact on the chemical industry. The new methodology for assessing health and environmental hazards could also lead to changes in European product regulations. At the same time, the EU is willing to put in place incentive mechanisms for the transition to sustainable production. The next months will be critical for the chemical industry. Public consultations will end on 20 June, and the strategy will be published in the third quarter of 2020.

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EU consultations on Trade Policy

On 16 June, the Commission officially launched the public consultations for a major trade policy review. The European Commission is asking all economic actors to answer 13 different questions on different aspects of the Union’s trade policy, from trade defence to the role of trade policy in the EU’s environmental objectives. The EU’s new trade policy aims to fulfil two objectives: to make the European economy more competitive while at the same time achieving a model of “Open Strategic Autonomy”.

With this public consultation, the Commission is trying to rethink its trade policy in a post-COVID19 world. It foresees the risk of a rising protectionism and a weakening of multilateral bodies. The “Open Strategic Autonomy” model aims to achieve the right balance between openness and protection of the European economy and consumers. In addition, the EU is seeking input on the strategy to be adopted in the reform of the WTO bodies. EU trade policy shall focus on the effective implementation of the obligations of third countries that are parties to a trade agreement with the EU, with a view to providing improved market access for European companies. Furthermore, a white paper was published on 17 June proposing to set up authorities that will be able to re-establish a level playing field in the event of foreign subsidies.

In essence, the EU is opening historic public consultations as it seeks input from all economic actors in order to define guidelines and objectives on virtually all aspects of EU trade policy. Public consultations on the trade policy review are open until 15 September, while consultations on the white paper on foreign subsidies are open until 23 September. The Communication on trade policy should be published at the end of the year, while a regulation on foreign subsidies should be adopted in 2021.

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IX. EU’s Marshall Plan set to EUR 1 trillion investment initiative

The European Commission has announced its intention to launch a unique Recovery Plan in the history of the EU. This plan is already part of an unprecedented effort by the EU and Member States to support the economy. With the activation of the general safeguard clause of the Stability and Growth Pact in March and with the €500 billion coronavirus relief plan decided on April 9, more than EUR 3 trillion have already been invested to support the European economy. However, with this Recovery Plan, the Commission wishes to move to another level.

On 16 April, the President of the Commission Ursula von der Leyen, presented the basis of this “Marshall Plan” to the European Parliament. She called for innovative instruments to be introduced in the MFF in order to unlock massive investments of up to EUR 1 trillion. This new “Marshall Plan” will double the ambition of the sustainable investments foreseen by the Green Deal and the European Digital Agenda. Investments will be concentrated in particular in the technology and digital sector, in energy and in R&D. In addition, the Commission promises to invest massively in transport and in the agri-food sector.

In conclusion, the new “Marshall Plan” is set to at least double the EU’s ambition in terms of investment compared to the initial ambitions of the Green Deal and the Digital Agenda. Massive financing opportunities will start in the coming months. In view of these huge opportunities, it is crucial for all European economic actors to strengthen their presence in Brussels in order to make the most of this unprecedented EUR 1 trillion investment “Marshal Plan”.

X. EU’s New Circular Economy Action Plan

On 11 March 2020, the Commission published its New Circular Economy Action Plan. This document provides the basis for multi-sectoral regulatory work aimed at creating a circular economy by 2050. The plan foresees the introduction of new consumer rights, new ecodesign regulations and the mobilisation of several European research funds. Most impacted sectors are ICT and electronics, batteries and vehicles, packaging, building and construction, food, textiles, water and nutrients. The rules and regulations planned will have an impact on a global level, even for companies which are not present in the Single Market. Indeed, an important part of this plan focuses on the EU’s efforts to impose European standards at the international level.

In details, the Commission will propose a Sustainable Product Policy Initiative that will extend eco-design directives to the broadest possible range of products. The Sustainable principles will introduce new specific obligations to increase durability, reusability, the right for the consumer to upgradability of the products. In addition to these obligations, new consumer regulations will guarantee consumers a “right to reparation”. These regulations will also reinforce the obligations to inform the consumer about the lifespan of the product and the repair procedures. From 2020 to 2023, the Commission will adopt a number of regulations strengthening eco-design and waste reduction requirements. In addition, strategies on textiles and chemicals will soon be published.

In conclusion, this plan will have very important consequences on all sectors related to vehicles, food, electronics, plastics and textiles. Activities in the sectors concerned will be greatly influenced by these new regulations, from conception to sale. Consultations for several regulations have already begun. All companies concerned must therefore think about intervening in the decision-making process of the European institutions very quickly.

XI. EU presents its new Industrial Strategy

On March 10, the Commission presented its Industrial Policy Strategy. This plan sets out a broad work programme: from the implementation of a digital industrial strategy to the revision of competition rules. This strategy plans for a strengthening of the fight against barriers to trade within the internal market, development plans for key sectors and a strengthened partnership with industry in policy making. In addition, the Commission plans to internationalise its standards, in particular through WTO negotiations. Therefore, all companies, even those that do not trade directly with the EU, are concerned by this action plan.

More concretely, the plan provides for the modernisation of the Internal Market. The Commission plans to set up a Single Market Enforcement Task Force, a review of intellectual property rules and a recasting of the competition and anti-trust rules. In addition, the Commission will, in the coming months, present its strategies sector by sector. This concerns in particular the chemical sector and the mobility sector. The Commission will build its strategies and priorities through co-decision via the Industrial Forum and by fostering public-private partnerships.

In conclusion, the internal market will be strengthened, and structuring rules will be reviewed in the coming months. In addition, sector-by-sector industrial strategies will have an impact on product design and on research and innovation through funding programmes and industrial alliances supported by public actors. As the Commission has announced that these regulations will be co-designed in consultation with industry representatives, it is crucial for industry to strengthen its presence in the European decision-making process.

XII. 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.

XIII. 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.

XIV. EU to present its “Farm to Fork” Strategy

The Commission will publish at the end of April an action strategy on the agri-food sector called “Farm to Fork”. This strategy covers the entire sector, from animal farming and agricultural practices to the point of sales. The plan should set out five pillars for action: reducing the use of pesticides and chemicals in agriculture, promoting organic farming, reducing food wastage, a new regulatory framework for livestock farming, and new food marketing rules. The entire agri-food sector is therefore facing a comprehensive reform of the regulatory framework.

In more detail, the strategy will provide for a reduction in pesticide use through legally binding, quantified targets. The Commission is also considering introducing a legislative proposal to harmonise the information given on the packaging of food products. This would concern in particular the nutrient profile as well as the origin of the products. In addition, a survey to assess food waste will be launched soon, which could have an impact on food marketing regulations. Finally, animal farming is to be radically reformed. The Commission advocates a shift from a meat-based to a vegetable protein-based diet for livestock. Furthermore, rules will be put in place to encourage carbon capture.

The measures to be announced in the plan will be open for public consultation in the near future. It is therefore essential for companies and associations in the agri-food sector to make their voices heard in Brussels, but also in Berlin and Paris in order to promote their interests.