20 July 2020

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New study shows risk of opaque business influence during German Council Presidency

by Nina Katzemich, LobbyControl

Expectations for the German EU Presidency that has started July 1st are high. As Europe’s biggest, wealthiest nation, and one which has not suffered such a catastrophic loss of human life as experienced elsewhere during the pandemic, some argue that the German Government will provide strong and competent leadership at this moment of crisis for the EU.

But the reality of German Government positioning on many policy areas in the EU Council gives great cause for concern for the chances of both a sustainable and just post-pandemic recovery and the Green Deal of the European Commission President Ursula von der Leyen. This is shown by the new report  Tainted love: corporate lobbying and the upcoming German EU Presidency published by two NGOs, Corporate Europe Observatory (CEO) and LobbyControl a few days before the start of the German presidency.

Via various detailed case studies, the new report shows that on many EU issues – vehicle emission limits, new gas support and infrastructure, sustainable finance, tax policy, ePrivacy, chemicals regulation, fishing quotas – the German Government is too close to its domestic industry interests. This leads to delays, loopholes, or even the blocking of new EU rules, and seriously undermines the public interest. The case studies have been written by a range of NGOs: Bund für Umwelt und Naturschutz Deutschland e.V, Deutsche Umwelthilfe, Finanzwende, Netzwerk Steuergerechtigkeit, Coordination Gegen BAYER-Gefahren, and Our Fish.

 

Examples of business influence in many areas

 

For example, one case study by the BUND shows that the German Government has been watering-down EU carbon dioxide vehicle emission targets ever since they were introduced, despite the ‘Dieselgate’ scandal. The Government’s record in the EU Council has enabled the German car industry to maintain its model of ever bigger luxury cars with combustion, notably to boost Germany’s export balance. Like that, Germany has made no progress at all since 1990 in reducing CO2 emissions from road traffic. In January this year, German Minister for Economic Affairs and Energy, Peter Altmaier, wrote to Commission President Ursula von der Leyen to argue against more pollution limits for the car industry before 2030, which would be necessary to fulfil the new European climate target of being CO2 neutral by 2050.

Meanwhile, just when public budgets come under huge pandemic-induced pressure, “Tainted Love” shows how the German Government has so far refused to support EU proposals to introduce greater corporate tax transparency. Additionally, Finance Minister Olaf Scholz, alongside a handful of other Finance Ministers, has actively blocked an EU proposal for a Digital Services Tax (DST) on tech giants. The consequences of this latter approach were exposed two weeks ago when the US pulled out of OECD talks to discuss a global digital tax.

 

Structural role of Germany’s Minister for Economic Affairs

 

The report also uncovers how the Ministry for Economic Affairs and Energy (BMWi) under Minister Peter Altmaier has a decisive say in many of the cases featured. Altmaier and the BMWi often use their powerful position to intervene in legislation, on behalf of Germany’s biggest corporate players, including the car, gas, and publishing industries, to the detriment of the public interest.

 

Opacity helps corporate lobbyists

 

This business influence is helped through the fact that the Council of the EU, made up of ministers and officials from the 27 member states, is rightly criticised by the EU Ombudsman, civil society and national and EU level MPs for being the most opaque of the EU institutions. The report explains how a lack of transparency characterises almost all levels of Council policy-making. Its 150+ working parties and groups (which perform in-depth scrutiny of legislative proposals) do not systematically keep minutes or other records of their discussions, which prevents civil society, and journalists from understanding which country’s government is advocating which position, and to hold them to account. While the Council of Ministers’ meetings is live-streamed, many of the detailed negotiations between member states at that level happen off-camera. Quid pro quo deals between states trading-off different interests and different topics are part of how the Council operates, and contribute to EU member states’ lack of appetite for transparency.

Moreover, on the national level, there is hardly any transparency of how the Governments form their position for the Council. This leads to a situation in which governments decide on crucial politics for the citizens‘ everyday life – for example, which chemicals are allowed in our food and packaging or the purity of our drinking water – without real democratic scrutiny.  The opacity of the Council and its preparation on national level plays into the hands of corporate actors with the capacity, resources, networks, and access to get the information needed and feed their interests into the political process, over-shadowing civil society groups who lack the equivalent resources.

It should be mentioned though that, different from most other EU member states, the German Bundestag has strong information rights on what is decided and discussed in the Council and the members of the Bundestag are even able to issue statements about it. German MPs do try to use this, but it‘s an instrument mainly used by the opposition. These rights can be seen as a starting point to a much more democratic EU Council decision-making process that is closer to the citizens.

 

Together with 50 NGOs, on the day the study came out, LobbyControl and Corporate Europe Observatory published a statement asking the following from the German Government during its presidency:

 

1. Ensure the EU Presidency is not used to champion big business over the public interest. The German Government must put an end to privileged access for corporate interests and business only policy consultations, for its EU Presidency and beyond.

2. As the President, Germany must also champion much needed legislative and transparency reforms within the Council, and far greater lobby transparency at home.

3. The German model of parliamentary rights regarding the Government’s EU decision-making, and progressive models from other member states, should be replicated elsewhere in the EU where MPs’ rights are far less comprehensive.

4. Citizens should have new rights to both find out about, and have a say on, their government’s decision-making on EU matters. Citizens must no longer be excluded from this process.

 

For more information read

“Tainted love: corporate lobbying and the upcoming German EU Presidency”

 

This article was authored by Nina Katzemich, EU campaigner for LobbyControl