European Union

Vervloet and Others
Freedom of establishment
In Advocate General Kokott’s view, Belgium’s guarantee for ARCO financial cooperatives infringes EU law

As we’ve moved into the last stretch of the referendum, we’ve seen the emergence of a new dynamic: the referendum-as-general-election.

In setting out more clearly what a post-Brexit future would look like, the key figures in the Leave campaign – Boris Johnson, Michael Gove, Chris Grayling and Priti Patel – have also been sketching what a post-Cameron government would look like, presumably with them in positions of power and influence.

This trend has been really come through with yesterday’s announcements on immigration – extending the non-EU points system to EU nationals – but was also arguably visible in the various pronouncements on reasserting sovereignty, via a constitutional court or a British bill of rights or a sovereignty act.

At a tactical level, there is something to this approach. Given the difficulty of keeping public engagement with the EU issue turning the referendum back into something that looks more like a general election looks potentially productive: focus on people’s unhappiness with ‘the government’ and David Cameron and kick them/him out.

Of course, this assumes people overlook that you’d be replacing one Tory government with another, but one might argue that this model is part of the explanation for why Jeremy Corbyn isn’t fighting too hard to save Cameron’s political skin: maybe the turnover of power splits the Tories and gives him more of a chance in 2020. It certainly rubs the same way as Corbyn’s general ambivalence about the EU.

There is a certain circularity in that view, since it has been precisely Corbyn’s ambivalence that created the space for Johnson and co to make this push: it’s not coincidental that the biggest figures in Leave have come from the Tories, given the depth of feeling on the EU issue and the additional prize of the party leadership.

This dominance has become self-reinforcing, as they have been able to set Leave’s agenda more and more. UKIP and Nigel Farage have been active, but marginal at the strategic level, unable to make this kind of government-in-waiting play. This suits the Leave Tories, who not only re-direct UKIP’s populist challenge, but also get Farage campaigning for them. In the long run that might cause ‘the establishment’ a problem, but not just yet.

To see the referendum as a power-play within the Conservative party is a cynical position, and I wouldn’t pretend it’s anything like the whole story, but it feels like it’s going to be the most consequential one in the short- to medium-term. Either EU membership is secured and pushed hard off the agenda by Cameron and his successor, or it’s a few years of trying to find a model that works: not there’s no rupture, no breakpoint where everything changes.

However, there is a certain irony here. As my economist colleagues like to note, there’s never a free lunch. The price that Leave Tories look like paying comes from the choices they’re making now.

Their choice of immigration control is simple and clear, but it necessarily precludes an EEA-style post-Brexit agreement, since it’s incompatible with free movement: the EU has no good incentive to break the habit of its lifetime and offer full market access without free movement of workers. That in turn closes down the option that would offer the smoothest transition out of the EU for the UK and raises the costs of building a more arm’s-length relationship, not mention the likely economic costs that most analysts suggest will be incurred.

Likewise, the legal options being laid out sound lovely – who doesn’t want have control of our decisions – but are in practice terribly complex. Having spent a day in a room with legal experts this week, I’m happy to take their opinion that the proposals are either meaningless or would imply restrictions on politicians’ power that they are going to have be incredibly selfless to accept. Making no judgment on any future government, the fact that such selflessness hasn’t been shown by any previous administration suggests that we might be sceptical about the chances of change. Moreover, even if they do happen, then they imply a change in the British constitutional order much more wide-reaching than even EU membership has wrought.

Whether the village will let itself be destroyed to save it is very much an open question.

The post Destroying the village to save it appeared first on Ideas on Europe.

My five years as a PhD student, first in Oxford (Brookes) and then as a post-doc at LSE, have told me that the smart people from the UK, especially those working in the City, see the Euro project thus:

Cartoon by Schrank (The Economist)

European Economic and Monetary Union (EMU) is like a ship that has been built badly from the start. The Brits have warned the Continental Europeans about this structural flaw even before the ship left harbour (think of Thatcher), but the latter wouldn’t listen. They left port anyway, while the Brits stayed ashore convinced that this was a journey doomed to fail.

History has proven the smart people from Oxbridge and the City right. In 2010, confronted with the first big storm (the Global Financial Crisis), the European ship showed its deficiencies and water started to break into the vessel. The Brits screamed: “we told you so”, and enjoyed their Schadenfreude.

However, the ship hasn’t sunk yet. The Continentals are trying hard to fix it while at high sea. They have patched over the leaks for now, although the enterprise is hampered by the divisions in the crew (too many nationalities) and by a lack of leadership. The French and German officers do not agree on the end solution, and the only one keeping the vessel afloat is the Chief Engineer called Mario Draghi.

These troubles make the Brits, and especially the English, feel even more self-righteous about their decision to not join EMU. They are pretty convinced the ship will eventually sink. Nonetheless, they don’t want to be overconfident. They know deep down in their soles that it would be a mistake to underestimate German engineering and French keenness for grandeur so they have a speed boat ready to join at high see in case the ship is eventually fixed. Because one thing is certain. If the ship sails on, the Brits need to have a say in the direction it should take.

This metaphor sums up the view of the City of London in regards to the Brexit debate. In general the Brits have looked at the European Union project from a purely transactional perspective: “What can I get from this arrangement?” This is very different in the Continent, where emotional elements such as angst from your past (Germany), obsession to be bigger than you are (France), desire to belong to a rich club (Italy and Spain and almost everyone else) and fear from your neighbour (the CEE countries) are much more pronounced.

If there is a sentimental bias to be detected among the English (less so among the other Brits) towards the EU it works usually against further integration. The main reason is the British Empire. The Brits have not been invaded since William the Conqueror in the 11th Century and this counts. As a German official told me once: “For the Brits democracy means Westminster. They cannot envision it beyond”. This explains the British obsession to consider the European Parliament as an illegitimate body.

Both the very rational (and so far dominant) approach towards the EU but also the Empire-clinging sentimental rejection against it are very present in the City of London. As a matter of fact, these two perspectives are on opposite sides in the Brexit debate. The former is represented by the big American investment and the European universal banks. They want to stay in the EU because doing so allows them to have access to the biggest and richest market on earth. The latter is usually embodied by the smaller wealth management firms, hedge funds and stockbrokers. They think Brussels curtails the good old English tradition of laissez-faire.

This division is centuries old. The Square Mile of the City is actually the best example of a Global Village. Since London after the Battle of Waterloo in 1815 overtook Amsterdam as the world’s most important financial centre, two tribes have co-existed in the City. The “Nativists” (mostly English) who have seen the success of the City intrinsically related to the British Empire. And the “cosmopolitans” (the smartest and more adventurous from the rest of the world) whose functionalist approach has always been the following: “To be as far from politics as possible to make business at ease (the off-shore component of the City being always attractive), but as close to power as necessary in order to influence it”. Thus, London was, and remains, the place to be due to its close connections to Washington and its influence in Brussels.

Of course, if the Brexit camp wins the forthcoming referendum this ideal configuration would change. The City would be further away from politics, and perhaps enjoy less regulation (although that is not assured), but at the same time it would be further away from power (both in Brussels and in Washington) and perhaps even more importantly it would give up completely on joining the EMU ship.

But what happens if eventually the ship gets fixed? Will the smart money of the City of London let it sail away? Unlikely. The ECB is already more powerful than the Old Lady. It will be even more so if EMU survives. This is why Goldman Sachs and the rest of big American and European banks have funded the “Bremain” campaign. They feel the “Nativist” camp led by Boris Johnson is stuck in an imperial illusion which won’t come back. And while they do so, they are thinking: “perhaps we should consider getting closer to Frankfurt. Not only because EMU might get fixed, but also because Westminster is becoming too insular”. And insularity is something you certainly don’t want as a banker.

EU-Asia Institute at ESSCA Ecole de Management, Angers
www.essca.fr/EU-Asia / @Essca-Eu-Asia

 

The post Brexit and the City appeared first on Ideas on Europe.

The Korean Workers’ Party (KWP) held its Seventh Congress, the first since 1980, from 6 to 9 May 2016. In theory, the Congress is the highest deliberative body of the only governing party of the Democratic People’s Republic of Korea (DPRK). The Congress yielded relatively modest results, with no real breakthrough, apart from establishing the 'defensive' nuclear deterrence concept. Kim Jong-un’s position as North Korea's supreme leader was fully formalised and now seems to be stronger than ever. The Party is likely to gain further power at the expense of the military. Nuclear deterrence is now firmly enshrined in the Party's statutes as well as the country’s constitution. Pyongyang has made clear that no nuclear deal is possible unless the US and its allies accept North Korea as a 'nuclear state'. Despite its propaganda announcements, North Korea is not ready to modernise its sclerotic economy. While some cautious developments cannot be ruled out, the regime's open criticism of the Chinese economic model suggest that any reforms would be limited and very probably inconclusive.
Source : © European Union, 2016 - EP

Insert metaphor about how toasters can kill if you’re not careful, apply to referendums

One of the most interesting aspects of the EU referendum campaign so far has been the extent to which things haven’t changed.

Six weeks into the official period, we still have polling that gives no clear advantage to either side, nor even an indication that attitudes have changed at all: the don’t knows still make a solid 10-15% and have done for months. As we’ve been reporting on our social media monitoring, there’s no big explosion of public interest that can be detected.

All the lines of attack taken by either side have been ones that were long apparent and all have been countered (broadly speaking) almost immediately.

There’s been no big shock (unless you though Boris Johnson was actually doing the donuts himself), either within the UK or outside.

In short, things looks very much like they did: close.

Which makes this week’s sounds from the Remain camp all the more perplexing.

To read the Telegraph, following a poll that showed a big lead for Remain, was to read a worldview that said ‘job done’: the swing had come in, the messages had got through and now it was time to just cross ‘t’s and dot ‘i’s.

Regardless of what politics might be going on behind this, this looks at best irresponsible and at worse, damaging.

If last year’s General Election taught us anything, it’s that polling has a problem and for all the remedial work done by the industry since, they still have a problem, as evidenced by the continued divergence of telephone and online polling results. If even if they didn’t have a problem, then to take one of two polls as hard and fast evidence for a swing is bad practice (as Tuesday’s ICM poll neatly demonstrated).

If that’s irresponsible, then it’s equally important to stress the scope for damage to Remain’s case.

One of the more robust findings we have to date is the ‘enthusiasm gap‘ (Leavers are noticeably more committed to their cause than Remainers, as so more likely to turn out). Remain’s big challenge has always been to convince people that they need to get excited enough about the (roughly) status quo option to go and vote. As one Remain campaigner put it to me last week, “what do we want? the same” isn’t a great rallying cry.

In such a situation, one way to get the vote out is precisely to focus on the closeness of the campaign: Austria’s Presidential elections has provided a nice demonstration that one’s vote does actually count for a lot. But if Remain try to play up a swing (whether or not it exists), then the urgency and importance of voting drops, to Leave’s benefit. With all modelling suggesting that turnout is the crucial factor, any message that plays down the importance of mobilisation is going to hurt Remain.

To be clear, there’s no suggestion that the Telegraph (or any of the other outlets that ran with the story) are trying to work to engineer a Leave vote. Instead the issue is one that has been endemic in other referendums on European issues.

Where governments have lost such votes, in every case one of the key factors has been complacency. In the case of treaty ratifications, that has been driven by the weight of other member states’ ratifications and by the impression that the government’s hard bargaining on the text will be enough to carry the day. In the case of joining policy areas, the difficulty of the government reaching agreement to get to a vote in the first place does the same.

Here we have something a bit different. The government clearly didn’t expect to be holding this vote and it has recognised that the ‘new settlement’ agreed by Cameron in March isn’t enough to make the case, so it hasn’t gone in with its eyes shut. However, the capacity to bring many big guns to bear – international leaders, all but one party leader, most economists – and the subsequent command of the rational agenda has lent the impression that things must come right. Tony Blair is the purest expression of this sentiment to date.

This is very much to miss the dynamics of what is happening. As Janan Ganesh wrote yesterday, the EU ‘debate’ looks and feels a lot like the elite talking with itself, rather than actually engaging the wider public. With old notions of deference long gone and the lure of populism hanging nearby, it seems all too possible to envisage a situation where the referendum is determined more by the alienation of the public from the political sphere than by any substantive issue.

I’ve framed this mainly as an issue for Remain – which it is – but it’s also something that Leave have to address too: if they win, then some of them will be stepping into the corridors of power very soon and they will have to make good on their promises if they are not to generate another cycle of disillusionment and disengagement.

The fight for this referendum is still very much on, but so too is the ability of politicians and other elites to speak for the people: ultimately, that matters more than any outcome on 23 June. And that’s why we have to recognise that this matters not just in-of-itself, but also as a marker of our democratic lives.

The post Complacency is a killer appeared first on Ideas on Europe.

Thank you for having me here tonight.

It's a good coincidence that at this difficult - perhaps even dramatic - time in the history of the European Union, I have the opportunity to address business people, entrepreneurs and managers. Because today Europe really needs the features that are typical of your environment: responsibility, pragmatism, common sense and numeracy skills. Your sense of practicality has told you to concentrate on the issues linked to your activity. And rightly so, because in fact it is you who decide about things that are crucial for ordinary people: employment, wages, the quality of our everyday environment. Today, however, we must all together think about the challenges of a more general nature. Whether or not we rise to these challenges will affect not only the economic future of Europe, but also its very existence as we know it. At stake is the liberal-democratic order, along with whole catalogue of values and principles, which have become a foundation of Western civilization.

Key to this civilisation was - and still is - a multidimensional notion of freedom as well as respect for rules established precisely to protect that freedom. The birth of that system was directly linked to the needs and desires of those who hundreds of years ago were creating European trade and entrepreneurship. It was for them  the merchants, producers, the sailors  for whom freedom and efficient law enforcement were vital. And it was the economy that determined the establishment of a liberal-democratic order, at the same time becoming its main beneficiary. The history of this part of Europe with its trade centres of Antwerp, Brussels, Bruges and Amsterdam, is the best illustration of this. Please forgive me the historical remark: I am not mentioning this because I am a historian by profession, but because of the necessity of the moment. Simply speaking: from many angles - and for different reasons - the foundations of democratic capitalism as well as Europe's political and axiological position are being questioned. If we fail to interpret these threats accurately, if we make political mistakes or commit the sin of omission, we will not survive in our current shape. That's why it is so important that Europe's business circles do not leave politics to the politicians alone, because that would be gambling in its purest form. It is politics - whether good or bad - that will ultimately decide the future of our continent, including your fields of activity. Politics has returned to the stage. And whether you like it or not, you must also play a part in it, because it is also your right, your duty and your interest to keep a watchful eye on the politicians. Both here in the European institutions, and in national capitals.

Let us focus on two issues. One, we must at all costs maintain and strengthen the political unity of the West. I mean the West in a political - not geographical - sense. We discussed this at the G7 Summit in Japan, among other things. Today it is becoming increasingly clear that a new international order may not necessarily follow our rules. Above all it is about the rule of self-restraint of the most powerful. Today, respect for the rules, agreements, and the institutions which supervise those rules, is not entirely a common phenomenon. And in a world without rules, the most brutal and insolent will be the ones who win, while the weaker and decent ones will lose. If we want to globally and effectively counter events such as violations of territorial integrity, vide Ukraine and Russia, territorial claims at sea, as in South-East Asia, breaching world trade regulations, as in the overcapacity in the steel industry, to mention but a few issues discussed at the last G7 Summit, we must stand united. A world which respects the standards present in the EU and the US, in Canada and Japan, and this is not a full list, is a better world than the one defined by a lack of rules, the use of force and short-term interests. That's why it is so important that in our debate about TTIP, CETA (the agreement with Canada), or EPA (with Japan), we remember about the strategic and geopolitical dimensions of those agreements.

Two, we have to maintain the internal European order. I don't need to explain to anyone present here what dramatic consequences, also economic, would be brought about by Brexit. An interesting forecast was presented by José Angel Gurria, Secretary General of the OECD at the G7 summit. According to him, a UK exit would be a major negative shock to the UK economy, with economic fallout in the rest of the OECD, particularly in other European countries. By 2020, UK's GDP would be over 3% smaller than otherwise. And by 2030, in a central scenario, GDP would be over 5% lower.

It is even worse when we look at the effects of a possible break-up of Schengen. The European Commission calculates the direct costs of 'non-Schengen' to be between 5 and 18 billion euros per year. A study by the Bertelsmann Foundation is even more dramatic when it says that Germany alone would face additional costs of between 77 and 235 billion euros in total by 2025.

Such may be the economic costs of our political mistakes and omissions. But we know that there are more threats, and the migration crisis has shown how difficult it is today to agree a common European answer and foster common determination in the decision process. However, the greatest threat to Europe is self-doubt and a lack of energy in the pro-European mainstream, as opposed to excessive energy among the radicals and extremists. There is no worse prospect for the European economy than the omen of a triumph of anti-liberal and Eurosceptic political forces, whether left or right. We must and can avoid this scenario. The condition is to depart from utopian dreams and move on to practical activities, such as for instance reinforcing the EU's external borders or consistently completing the Banking Union. Forcing lyrical and in fact naïve Euro-enthusiastic visions of total integration, regardless of the obvious good will of their proponents, is not a suitable answer to our problems. Firstly because it is simply not possible, and secondly because - paradoxically - promoting them only leads to the strengthening of Eurosceptic moods, not only in the UK. As one of the key players of European integration Hubert Védrine recently said: "You see governments and parties all over jumping up and down asking for 'more Europe, more Europe!'” “If you want people to massively reject Europe, just keep on." 

While remaining liberal, creative and brave in our social, intellectual and economic lives, in our political lives we should rather be guided by a conservative reflection. Radical and violent political changes will lead us towards entropy and chaos, not towards a better order. Europe in its present shape deserves more patience. An ideological drive forward can end in a disaster. That's why what we desperately need today is cool heads and warm hearts. Not the opposite. 

And let us not forget: when you look too far ahead, you can easily trip over and fall. Thank you.

The 4th railway package, tabled by the European Commission in January 2013, aims to improve the competitiveness of the rail sector and quality of rail services by removing administrative costs, introducing more competition in domestic passenger services and ensuring a level playing field for operators.

Source : © European Union, 2016 - EP

The 4th railway package, tabled by the European Commission in January 2013, aims to improve the competitiveness of the rail sector and quality of rail services by removing administrative costs, introducing more competition in domestic passenger services and ensuring a level playing field for operators.

Source : © European Union, 2016 - EP

New EU data protection legislation aims to create a uniform set of rules across the EU fit for the digital era, improve certainty as to the law and boost trust in the digital single market for citizens and businesses alike. Clear and affirmative consent to data processing, the right to be forgotten and tough fines for firms breaking the rules are some of the new features.

Source : © European Union, 2016 - EP

New EU data protection legislation aims to create a uniform set of rules across the EU fit for the digital era, improve certainty as to the law and boost trust in the digital single market for citizens and businesses alike. Clear and affirmative consent to data processing, the right to be forgotten and tough fines for firms breaking the rules are some of the new features.

Source : © European Union, 2016 - EP

Talks on a Trade in Services Agreement (TiSA), with countries representing 70% of world trade in services, should deliver international rules and more opportunities for EU firms to supply services such as transport and telecoms in third countries. But "nothing should prevent EU, national and local authorities from maintaining, improving and applying their laws", notably on labour, social protection and data protection, say MEPs’ recommendations to EU negotiators, voted on 3 February 2016.

Source : © European Union, 2016 - EP

Talks on a Trade in Services Agreement (TiSA), with countries representing 70% of world trade in services, should deliver international rules and more opportunities for EU firms to supply services such as transport and telecoms in third countries. But "nothing should prevent EU, national and local authorities from maintaining, improving and applying their laws", notably on labour, social protection and data protection, say MEPs’ recommendations to EU negotiators, voted on 3 February 2016.

Source : © European Union, 2016 - EP

The provisional deal reached by Parliament and Council negotiators on 2 December 2015 on an EU directive regulating the use of Passenger Name Record (PNR) data for the prevention, detection, investigation and prosecution of terrorist offences and serious crime was endorsed by the Civil Liberties, Justice and Home Affairs Committee on 10 December 2015 by 38 votes to 19, with 2 abstentions.

Source : © European Union, 2016 - EP

The provisional deal reached by Parliament and Council negotiators on 2 December 2015 on an EU directive regulating the use of Passenger Name Record (PNR) data for the prevention, detection, investigation and prosecution of terrorist offences and serious crime was endorsed by the Civil Liberties, Justice and Home Affairs Committee on 10 December 2015 by 38 votes to 19, with 2 abstentions.

Source : © European Union, 2016 - EP

The 30th plenary session of the ACP-EU Joint Parliamentary Assembly took place in Brussels from 7 to 9 December 2015. The session was opened formally by its Co-Presidents Louis Michel for the European Parliament and Fitz A. Jackson (Jamaica) for the ACP.

Source : © European Union, 2016 - EP

The 30th plenary session of the ACP-EU Joint Parliamentary Assembly took place in Brussels from 7 to 9 December 2015. The session was opened formally by its Co-Presidents Louis Michel for the European Parliament and Fitz A. Jackson (Jamaica) for the ACP.

Source : © European Union, 2016 - EP

On 1 June 2016, the Permanent Representatives Committee (Coreper) endorsed, on behalf of the Council, a decision to provide a maximum of €500 million in macro-financial assistance to Tunisia.

The aim is to support economic stabilisation of the country and a substantive reform agenda, contributing to reducing its external financing gap. The support will be shared with the IMF, which on 20 May 2016 extended the arrangement under its extended fund facility for Tunisia for US$2.9 billion.

The European Parliament is expected to approve the decision at first reading at its plenary session on 6‑9  June 2016. The Council will then be called on to adopt the text, as agreed with the Parliament, with no amendments to the Commission's proposal.

Loans

The assistance will be available for a period of two and a half years. It will be provided in the form of loans, to be disbursed in three instalments. The loans will have a maximum average maturity of 15 years.

Conditionality

The assistance will be subject to a memorandum of understanding (MOU), to be agreed between the Commission and Tunisia. The MOU will lay down clearly defined economic policy and financial conditions, focusing on structural reforms and sound public finances.

A precondition for granting macro-financial assistance will be that Tunisia respects effective democratic mechanisms and the rule of law, and guarantees respect for human rights.

The Commission and the European External Action Service will monitor the fulfilment of this pre-condition throughout the life-cycle of the macro-financial assistance.

will take place on Wednesday 15 June, 9:00-12:30 and 15:00-18:30 and Thursday 16 June, 9:00-12:30 in Brussels.

Organisations or interest groups who wish to apply for access to the European Parliament will find the relevant information below.

Further information
watch the meeting live
Access rights for interest group representatives
Source : © European Union, 2016 - EP

On 2 June 2016, the European Union and the United States of America signed the so-called "Umbrella agreement" which puts in place a comprehensive high-level data protection framework for criminal law enforcement cooperation. The agreement improves, in particular, EU citizens' rights by providing equal treatment with US citizens when it comes to judicial redress rights before US courts.

The agreement was signed by Dutch minister Ard van der Steur and Commissioner Jourová on behalf of the EU and  by Attorney General Loretta Lynch on behalf of the US authorities. Minister Van der Steur said: "This agreement symbolises the values the United States and the European Union share. It will improve cooperation between US and European Law enforcement authorities when combatting serious crime and terrorism. It will advance the full respect for fundamental rights whenever personal data is being transferred between us."

The "Umbrella agreement" covers all personal data exchanged between police and criminal justice authorities of the EU member states and the US federal authorities for the purpose of prevention, investigation, detection and prosecution of criminal offences, including terrorism.

The agreement will facilitate criminal law enforcement cooperation while, at the same time, providing safeguards and guarantees of the legality of data transfers. Those include, for example, provisions on clear limitations on data use, the obligation to seek prior consent before any onward transfer of data, the obligation to define appropriate retention periods, the right to access and rectification, etc.

The agreement will complement existing and future EU-US and member state-US agreements between law enforcement authorities. It is not in itself a legal instrument for any transfer of personal information to the US but it supplements, where necessary, data protection safeguards in existing and future data transfer agreements or national provisions authorising such transfers.

Next step

After the signature and before the agreement can be finally concluded, the European Parliament will need to give its consent.