News

Job vacancy: Belgian Public Affairs Consultant (maternity cover)

Expiration date: 11 October 2020

Country/City: Belgium, Brussels

Experience: mid to senior level

Contact name: Cathy Kremer

Contact e-mail address: c.kremer@Dr2consultants.eu

 

Job Description

Dr2 Consultants is looking to hire an experienced and bilingual (Flemish and French) Belgian Public Affairs professional for a maternity cover between 3 to 5 months starting in December 2020 until the end of April 2021 to work with one of our digital/tech clients.

Do you have a proven track record in Belgian politics or Public Affairs? Are you eager to offer strategic political advice and implement Public Affairs and communication strategies? If so, we invite you to apply for this vacancy for a Belgian Public Affairs Consultant.

What you will do

  • Actively monitor political and policy developments at all Belgian levels;
  • Actively monitor parliamentary activities in key areas of interest at all Belgian levels;
  • Strategically advise on Public Affairs priorities and activities;
  • Strategically prioritize and translate broader business objectives into local initiatives;
  • Strategic outreach to high-level stakeholders.

Required skills

  • Bilingual in Flemish and French. Proficiency in English;
  • A proven track record of 3-7 years of experience in Belgian Public Affairs;
  • Thorough knowledge of the Belgian political decision-making processes (regional and federal levels);
  • A background in digital/tech is a plus.

Broader profile

  • University-level education (Master’s degree), preferably in an area related to political or social science, or law;
  • The ability to manage campaigns independently and cope with multiple priorities;
  • Excellent written and oral communication skills;
  • Excellent analytical skills, i.e. ability to analyze legislative texts, translate into clear language and advise on public affairs actions;
  • A network in the Belgian Public Affairs sphere (regional and/or federal level);
  • Excellent interpersonal skills, with a positive and can-do attitude;
  • Knowledge and experience in the digital/tech sector is a plus;
  • Experience in a multinational company is a plus.

 Terms and conditions

To apply for this position, please send your CV and cover letter to Ms. Cathy Kremer (c.kremer@dr2consultants.eu). Applications should be sent not later than 11 October 2020 with ‘Application Belgian Public Affairs Consultant’ in the subject line of the email.

Please note that only shortlisted candidates will be contacted.

About Dr2 Consultants

Dr2 Consultants is a dynamic Brussels-based consultancy firm. We provide companies, organizations and NGOs with guidance on EU and Belgian affairs in the digital, transport and sustainability policy domains. To discover more about us, please visit our website (www.dr2consultants.eu).

EU Public Affairs in times of COVID-19: three lessons from the Dr2 Academy

The COVID-19 pandemic that reached the European continent in the beginning of March this year disrupted the daily life of businesses in countless ways. Apart from serious public health implications, the pandemic has also restricted mobility and forced many Europeans to work from home. As policymakers have to adhere to COVID-19 related restrictions as much as others do, the dynamics of policymaking and advocacy have changed significantly. This requires organizations to adapt the way in which they influence policymaking by engaging in EU Public Affairs. Dr2 Consultants’ Dr2 Academy presents three lessons how COVID-19 changed EU Public Affairs.

1. Digital Public Affairs in times of lockdown

Confinement measures, border closures and epidemiological color coding throughout Europe has severely hampered cross-border mobility, making physical meetings (in Brussels) almost impossible. The Croatian Presidency of the Council of the EU was required to facilitate Council meetings virtually and the European Parliament (EP) changed to remote voting during its plenary sessions. Following a controversial decision by EP President Sassoli earlier this month, Plenary sessions are taking place in Brussels (and not Strasbourg) at least until the end of 2020.

While industry representatives, lobbyists and other stakeholders used to meet Members of the European Parliament (MEPs) in one of the several parliamentary coffee corners, speak to Commission staff around the Berlaymont building or attend various events to broaden their network and get insight information, the nature of these meetings has changed significantly. Nowadays, setting up Zoom or Skype calls with policymakers to discuss the latest information on ongoing files has become an essential instrument for effective EU Public Affairs in times of COVID-19.

Furthermore, events, conferences and receptions moved online too in the form of webinars. Although not a fully-fledged alternative to the spontaneity of physical events, online conferences usually designate a timeslot for networking. Digital meetings pose their own challenges. In order to successfully convey a policy message, the use of PowerPoint presentations and other digital tools have become increasingly important. As the current situation is likely to be maintained, organizations will have to invest time and resources in the effective use of the appropriate digital tools.

2. Changing dynamics in the EU institutions

The reliance on digital meetings and COVID-19 emergency procedures shifted policy priorities, which resulted in delays of several legislative initiatives. In the Council of the EU, where multiple meetings normally take place simultaneously, the Croatian Presidency could (for technical and safety related reasons) only host one meeting at a time. This led to a capacity reduction of 25% at the height of both the pandemic as well as the political cycle. Moreover, Trilogue meetings between the Council of the EU and the European Parliament were preferably not held digitally, leading to additional delays. The European Parliament, which organized extraordinary plenary sessions to vote on COVID-19 related contingency measures, also witnessed postponement of several committee meetings. Flagship events, such as the Digital Transport Days and EU Green Week have all been moved to online environments.

Since policymakers, industry representatives and other stakeholders all deal with the same changing issues and circumstances, organizations are recommended to adapt to changing policy agendas and deadlines, as well as to align KPI’s accordingly. Creativity in maintaining regular contact with (institutional) stakeholders by exploiting the latest digital tools is imperative for effective Public Affairs in times of COVID-19.

3. Adapting to the changing policy agenda

During the initial months of the COVID-19 outbreak, the European Commission focused on managing the short-term effects of the crisis. Crisis management combined with the new way of digital working also caused the Commission to revise its Work Program for 2020. The publication of several initiatives has been pushed back and some have been grouped together. Legislative files with a lower priority have been moved up in their timelines, while more urgent ones got a priority position. Public consultations have in some cases also been extended, enabling more time for input from stakeholders. In general, the measures related to the pandemic have led to a considerable shake-up and accompanying unpredictability of the policy agenda for 2020 and beyond.

To remain on top of the developments in Brussels, it will be crucial for businesses to invest in monitoring the most recent developments and policy agenda changes (Dr2 Consultants offers such monitoring services). This will enable organizations to respond quickly to policy developments and capitalize on the opportunities to represent their interests at EU level.

Dr2 Academy 

Dr2 Consultants’ Dr2 Academy offers services such as EU and Belgium Affairs Trainings, individual coaching to Public Affairs professionals and organizational advice on how to embed Public Affairs within your organization. Dr2 Consultants can be contacted for any questions on how to be effective in times of COVID-19.

Dr2 Academy logo

Update on Belgian federal government negotiations

Towards a “Vivaldi-coalition”

In early September, and for the first time in months, there were positive signs that a majority could be found in Belgium willing to form a federal government. After several attempts over the summer that mainly focused on a “purple-yellow” coalition (consisting of the traditional parties, the socialists, liberals and Christian democrats and the Flemish nationalist party N-VA) and a “Vivaldi” coalition (consisting of the traditional parties and the green parties), it was clear that the latter was the more likely to succeed. However, in nearing the end of September, and after several “informateurs”, “koninklijke opdrachthouders/Chargés de mission royale” and “preformateurs”, every possible coalition remains fragile. This has been especially clear since the weekend of 19 and 20 September.

Already a fragile coalition

The first test for the current Vivaldi group, which started negotiations in August, was the collective expression of support by the chairs of the Vivaldi parties for the current Wilmès II government on 17 September, in absence of a new government. In normal circumstances, the Wilmès II government should have resigned by 21 September, or at least sought a vote of confidence in the House of Representatives, as the current minority government only received support for a limited time of 6 months to tackle the COVID-19 crisis. Due to the support of the Vivaldi coalition parties, Wilmès II will govern an additional two weeks, until 1 October.

So far so good, and therefore the weekend of 19 and 20 was crucial to finally launch the Vivaldi coalition, most notably with the introduction of a new Prime Minister. The very first conversation on this topic already proved to be divisive as several parties claimed the position of Prime Minister based on different arguments, such as who is the biggest political family or who is the biggest party in Flanders, as there were already two consecutive Walloon Prime Ministers the past legislatures. That this would be a hard nut to crack was already known, but the president of the Walloon liberals (MR), George-Louis Bouchez, really made the bomb burst as he stated in an interview on 20 September that he was certain that the current Prime Minister, Sophie Wilmès (MR) would stay on. Once again Bouchez provoked his colleagues with personal interviews and tweets. Especially the Flemish socialists (sp.a) were upset and reacted on 21 September that they do not want to continue the coalition talks with the MR.

Despite these difficulties, “preformateurs” Egbert Lachaert (Open Vld) and Conner Rousseau (sp.a) spent a whole afternoon on 21 September trying to save the Vivaldi coalition. Because that did not work, the “preformateurs” decided to go to King Philippe to offer their resignation. However, the King refused that resignation, which is rather an exception. It seems that by refusing this resignation, King Philippe wants to force a new government, but this is only a short-lived tactic. Lachaert and Rousseau will report again by Wednesday 23 September at the latest.

Time is running out

The question is if the remaining days are enough to boost the viability of a possible Vivaldi coalition. Timewise it is getting very difficult to have a new government in place by 1 October, when the Wilmès II Government must resign. This would mean that by the end of this week or latest the beginning of next week the basis of the new government agreement must be approved. The different party congresses could follow after that and the new Prime Minister can make the government statement by 1 October. A vote of confidence in the new government could follow by 3 October.

Alternative?

It is not clear if the Vivaldi group will survive this week. The parties have definitely made it very difficult for themselves by setting a deadline on 1 October. N-VA chairman Bart De Wever expects the Vivaldi parties will continue their attempt to form a government. De Wever made clear that he and his party are ready for opposition as he stated on 21 September: “We will destroy them from the opposition.”

An alternative coalition is of course still possible, but the relationships between a lot of parties have become bitter, especially between the N-VA and the liberal parties. However, a workable alternative could be a Vivaldi coalition without the MR and the Walloon Christian democrats from cdH instead. However, Lachaert has not been prepared to drop his Walloon counterpart so far.

If this is not possible, then there is still the possibility of new elections. As there is still a health crisis ongoing and new elections will not magically bring the solution (especially because populist parties like Vlaams Belang (extreme-right Flemish party) and PVDA/PTB (extreme-left party in Wallonia) will gain new seats according to the latest polls and the other parties do not want to cooperate with them), this remains very unlikely. However, after 486 days of having no federal government with a majority in the House of Representatives, pressure is growing.

The Digital Services Act – How does it affect businesses in the EU?

The upcoming Digital Services Act (DSA) package, announced by the President of the European Commission, Ursula von der Leyen, in her political guidelines and in the Commission’s Communication “Shaping Europe’s Digital Future” of 19 February, is expected be published in the end of 2020. This will represent the Commission’s most ambitious plan to regulate digital services. The DSA package is expected to include a revision of the 2000 e-Commerce Directive (ECD), introduction of ex ante rules for ‘gatekeeper’ platforms and potential provisions for platform workers. So, how will this impact businesses in the EU?

When thinking about the impact of the DSA, one might initially think about big international platforms, and while those certainly can be impacted by the upcoming legislation, the implications for businesses in general can likely be much more far-reaching. The DSA is planned to have a more interventionist approach compared to its predecessor, the e-Commerce Directive, and will have broad implications for European and non-European businesses operating within the EU.

A wide range of information society services will be impacted by the new rules, one can think of transport and tourism platforms, e-commerce marketplaces, social media platforms, online sellers, data services, online search engine providers and more. The revision of the e-Commerce Directive is expected to be the most important overhaul of digital legislation of this decade, and given ongoing digitalization efforts, it is a crucial file to follow for many sectors. If you are interested in getting up to date insights into this topic, learn more about our monitoring services and get in touch with us.

Digital Services Act – what is it?

There are three main principles in the current e-Commerce Directive, which was adopted in 2000, for which the European Commission has to decide whether they will maintain them or make changes:

  • The internal market clause (i.e. country of origin principle) establishes that a provider of information society services is only subject to the rules of the Member State where it is established. It may then provide the services across the 27 other Member States without being subject to the rules of those other States.
  • The e-Commerce Directive (Art. 15) prohibits Member States from imposing general monitoring obligations on online intermediaries. In essence, this means that it is prohibited to require from intermediaries that they actively seek facts or circumstances indicating illegal activity.
  • The limited liability clause for online intermediary services (further explained below).

There are diverging views across the various digital sectors on the preferred course of action, depending on the interests at stake. Regardless of the direction the Commission will decide to take with its legislative proposal, it can be expected that these principles will have a prominent role in upcoming negotiations and debates.

The ex-ante rules for ‘gatekeeper’ platforms would address the issue of the level playing field in European digital markets, where, according to the European Commission, currently a few large online platforms act as gatekeepers. The rules will be aimed at ensuring that consumers have the widest choice and that the EU single market for digital services remains competitive and open to innovation. This could be done through additional general rules for all platforms of a certain scale, such as rules on self-preferencing, and/or through tailored regulatory obligations for specific gatekeepers, such as non-personal data access obligations, specific requirements regarding personal data portability, or interoperability requirements.

The Commission is also taking the opportunity to consult on other emerging issues related to online platforms, such as the opportunities and challenges that self-employed people face in providing services through online platforms. For instance, those working for food delivery applications or online transport platforms.

Digital Services Act: Implications for businesses

There will be various implications for various businesses depending on the sector concerned:

e-Commerce

If we take as an example “e-commerce”, the upcoming DSA will have two main implications. First, there will most likely be a re-evaluation of the role of e-commerce marketplaces. The focus of the current debate lies on the complex issue of the future of the limited liability principle, introduced by the e-Commerce Directive. The Directive includes an exemption from liability for digital services hosting illegal content if they are not aware of the illegality or, when they become aware, they act expeditiously to remove or block access to the illegal material. This is also known as “safe harbour”.

There are actors that say this clause is not enough, stating that liability for platforms should be extended, but there are others arguing that the current regime could disincentivize proactive content moderation measures. In this context, there has been discussion about the introduction of a potential “Good Samaritan” principle, which would aim to ensure that online intermediaries are not penalized for proactive measures against illegal content.

Second, the role of online sellers is an important element, as this is directly linked to EU’s inability to enforce its laws to non-EU based sellers and marketplaces, in particular when they have no legal representative in the EU.

Information society services

Another example of businesses that would be impacted by the new rules are information society services offering a wide range of services such as search engines, cloud services and other platforms. Those businesses generally consider it important that the core foundations of the e-Commerce Directive are respected, i.e. limited liability, no general monitoring obligations and the maintenance of the country of origin principle. Platforms can likely also be impacted by rules on transparency in online advertising, which are targeted by the DSA.

The introduction of ex ante rules for ‘gatekeeper’ platforms is planned to build on the transparency requirements for online platforms and the rules on provision of intermediation services between businesses and consumers, as stated in the Platform to Business Regulation (P2B), applicable since 12 July 2020. The Commission foresees the inclusion of perspective rules for platforms on self-preferencing, data access policies and unfair contractual provisions, as well as a data gathering framework allowing regulators to collect further information from gatekeepers on the workings of their platforms.

Furthermore, specific rules for gatekeepers of a certain size have been proposed, including rules against ‘blacklisted’ behaviour for all platforms or more tailored interventions on a case by case basis. Potential obligations for large platforms to share the data they obtain is expected to become an issue of debate. However, it is still unclear which platforms will be identified as gatekeepers, and which markets will the new rules focus on. Furthermore, the introduction of such rules, while aimed at protecting smaller EU businesses, might go against EU’s core antitrust principles if there is no evidence of systemic market failure.

Next steps

On 8 September, the Commission closed its public consultations on the DSA, which gathered contributions from platforms, companies, as well as business and consumer associations.

Meanwhile, three committees in the European Parliament: Committee on the Internal Market and Consumer Protection (IMCO), Committee on Civil Liberties, Justice and Home Affairs (LIBE), and Committee on Legal Affairs (JURI) are currently debating over their own-initiative reports, with final committee votes planned by the end of September, followed by a final vote during the October Plenary session.

Dr2 Consultants closely monitors the developments on this file for its clients. If you would also like to know more about the upcoming initiative, and how it might impact your business, please contact Dr2 Consultants.

Interested to know more about other upcoming EU legislative proposals? Read our blog post – Back to work: EU legislative proposals – 2020 outlook.

Traineeship Vacancy: Public Affairs Trainee

Job title: Public Affairs Trainee

Expiration date: 20 September 2020

Country/City: Belgium, Brussels

 

Company name: Dr2 Consultants

Contact name: Ward Scheelen

Contact e-mail address: w.scheelen@dr2consultants.eu

 

Company profile

Dr2 Consultants is a dynamic Brussels-based consultancy firm that provides companies, organizations and NGOs with guidance on EU and Belgian affairs (www.dr2consultants.eu) in the digital, transport and sustainability policy domains. We are looking for a highly-motivated Dutch-speaking trainee to assist our team.

Job description

  • Preparing background notes, briefings, reports, and articles;
  • Assisting consultants in conducting research, analysis and monitoring activities for their clients;
  • Assist consultants in the development and execution of Public Affairs and communication strategies;
  • Assisting consultants in their interest representation on behalf of their clients;
  • Assist and learn to influence political decision-making through the development and execution of Public Affairs strategies;
  • Assisting the Office Manager with day-to-day administrative duties.

Background and qualifications

  • Graduated from a Master’s degree in a relevant field such as European studies, Political Science, Communications or other relevant education;
  • Previous traineeship experience within the European Institutions and/or Public Affairs is an asset;
  • Language skills: Excellent spoken and written Dutch and English (Native-speaker level or equivalent). Knowledge of other languages would be an asset;
  • Strong PC skills (Word, Excel, Outlook, PowerPoint, etc.);
  • Proactive and dynamic person with excellent communication and personal skills;
  • Flexible work attitude, hands-on mentality, able to work on multiple tasks simultaneously;
  • Sound interest in digital, transport and circular economy related policies at European (and Belgian) level.

Terms and conditions

Procedure

To apply please send your CV and cover letter (in English) explaining why you would be the right candidate for this position to: w.scheelen@dr2consultants.eu. Applications should be sent as soon as possible and no later than 20 September with ‘Application Public Affairs Trainee’ as subject line. Only shortlisted candidates will be contacted.

EU flag

Back to work: EU legislative proposals – 2020 outlook

As the summer recess is coming to an end, the European Commission will start preparing the EU legislative proposals that are still in the pipeline for 2020, according to the work program. As the second semester of the year will be a packed one, it is key to timely prepare input in order to have your priorities heard.

Following our blog on the EU initiatives that were open for feedback over summer, Dr2 Consultants now guides you through the main remaining proposals for 2020 in the transport, sustainability and digital sector. You can find these below in that particular order.

Transport up-to-speed with the new decade

Emerging developments such as the decarbonization of transport, digitalization and the global COVID-19 pandemic have stressed the need to review the Trans-European Transport Network (TEN-T) Regulation. The TEN-T policy aims to develop and implement a Europe-wide infrastructure network linking ports, highways, airports and railways. With the upcoming revision of this EU legislation, the European Commission aims to bring TEN-T up-to-speed with the ongoing green and digital transitions. The Commission is expected to put renewed emphasis on the strengthening of urban nodes, the update of infrastructure requirements, and the alignment of the TEN-T policy with the EU’s environmental policies.

The Commission is currently finalizing the evaluation of the TEN-T Regulation. The different modes of transport are still invited to contribute to dedicated case studies in the course of September. The European Parliament is currently preparing an own-initiative report on the TEN-T policy. The Transport & Tourism committee will discuss the draft report on 3 September. The Commission is expected to publish a roadmap and a public consultation later this year. A legislative proposal is foreseen for summer 2021.

In addition to the TEN-T, the Commission is expected to publish the EU’s Strategy on Sustainable and Smart Mobility. With this strategy, the Commission intends to adopt a comprehensive strategy to reduce transport-related greenhouse gas emissions by 90% by 2050, and to ensure the transport sector is fit for a clean, digital and modern economy. A public consultation has been opened in the summer and is open for feedback until 23 September.

Visit our Transport page.

Green energy and sustainable production

The energy-focused sibling of TEN-T will also be subject to a revision this year. The Trans-European Energy Network (TEN-E) Regulation aims to link European electricity, gas and oil infrastructure into a single network, consisting of nine corridors. TEN-E focus areas are smart grids, electric highways and the cross-border carbon dioxide network. This EU legislation is considered to be instrumental to realize the renewable energy objectives across the Union, for example in stimulating the hydrogen economy. The Commission will come up with a legislative proposal for a revised TEN-E regulation.

European Green Deal Impact Scan

In addition, several EU legislative proposals will be initiated that will have an impact on producers. Proposals that tackle packaging waste, deforestation and industrial emissions are currently in the pipeline. Striving towards a circular economy, the Commission will promote waste reduction by reviewing the Packaging Directive. This may include improved design standards and increased recycled content in packaging materials. Possibly, packaging design standards will also change as a result of the Deforestation Regulation, which could include labelling requirements and verification schemes to increase the transparency of supply chains. Finally, the Industrial Emissions Directive may require additional sectors, such as farms and extractive industries, to implement available sustainable production techniques. Public consultations on the three initiatives are upcoming this year, and the respective legislative proposals are scheduled for 2021.

Visit our Sustainability page.

Trustworthy AI and shared data spaces

Artificial Intelligence (AI) is increasingly affecting our society. Applications can bring about revolutionary changes in healthcare, governance, research, production and many other areas of our society. On the one hand, opportunities such as the precision of diagnosis, the prevention of car accidents and more efficient farming are promising. On the other hand, AI carries several potential risks, including racial, gender or other discriminatory biases, infringements of our privacy and reduced governance accountability.

Amidst global competition, the European Commission aims to distinguish the EU approach with its emphasis on European values. The EU strategy must embrace opportunities, while protecting citizens from potential harmful impacts. The European approach for trustworthy artificial intelligence will propose ethical requirements for AI, following the general strategy presented in the White Paper, stakeholder consultations and the draft guidelines presented by the High-Level Expert Group on AI in 2018. The initiative will be a review of the draft guidelines, on which stakeholders will be invited to deliver input through the upcoming roadmap.

Another aspect of the EU digital strategy is the regulation of the growing volume of data. Data can give valuable insights that drive innovation in areas such as medicine, mobility and policy-making. The creation of common European data spaces will allow citizens, businesses and organizations to access non-personalized data from different Member States, pooled across different key sectors. European privacy rules (GDPR) and competition law continue to be applied. Although the roadmap has already closed, input can be delivered through the upcoming public consultation. Adoption by the College of Commissioners is expected by the end of 2020.

Visit our Digital & Tech page.

Next steps 

Commission proposals on the EU legislative initiatives mentioned above are expected by the end 2020, or in the course of 2021. As the Commission is preparing for a proposal-packed final quarter, it is key to reach out early to have your interests set on the agenda.

Want to know more about the upcoming initiatives, COVID-19, or other files that might affect your business? Please contact Dr2 Consultants to see what we can do for you.

Summer recess – what’s next?

As EU leaders agreed on a new proposal for the new Multiannual Financial Framework and the Recovery Plan on 21 July, the European Parliament was given good food for thought over its summer recess. However, the new long-term budget is not the only priority on the EU agenda. The Commission is already chewing on a series of proposals to be expected later this year and in 2021. In fact, now is the moment to deliver input on some key, planned legislative proposals, as the Commission launched a series of public consultations that are open until after summer. Let’s have a look what is next after the 2020 summer recess.

Transport: smarter and greener

The green and digital transition as the twin priorities of the Von der Leyen Commission are also reflected in the upcoming transport initiatives. To deliver the ambitious European Green Deal climate neutrality objective, the mobility sector needs a 90% emission reduction by 2050. The Strategy for Sustainable and Smart Mobility, expected towards the end of the year, will be the overarching strategy for the delivery of the twin transitions in this area. Stakeholders can contribute to the public consultation until 23 September.

Expectedly, the strategy will include the integration of alternative fuels, in line with the recently published hydrogen strategy that already outlines a pathway for the deployment until 2050 in all modes. The strategy is also complemented by the upcoming FuelEU initiatives for the maritime and aviation sector. The FuelEU Maritime initiative, aimed at boosing alternative fuels in shipping specifically, is open for feedback until 10 September. The public consultation on ReFuelEU Aviation, initially planned for the first quarter of 2020, is still to be expected ahead of the Commission proposal this year.

Sustainability: a bigger role for tax

Taxation will become a more important instrument for the Commission to align consumer choices and business investments with its climate targets. On 23 July, public consultations on both the revision of the Energy Taxation Directive and the creation of a Carbon Border Adjustment Mechanism were launched. Having been unchanged since its adoption in 2003, the Energy Taxation Directive will be subject to a thorough review. The exact changes are yet to be determined based on the consultation outcome, however, what is clear is that it will include a correction of the minimum taxation rates for electricity, gas, and coal, as well as a tax exemption reduction for fossil fuels. The proposal, which is part of the European Green Deal, is scheduled for June 2021. The consultation is open for feedback until 14 October.

In addition, the Commission proposes a Carbon Border Adjustment Mechanism to prevent ‘carbon leakage’. This ‘CO2-tax’ internalizes emissions in the price of a product, so production does not shift to countries with lower climate ambitions. The exact instrument is still to be determined, and could take the form of an EU-wide import tax or an extension of the Emmission Trading System (ETS). The latter has already seen critical responses, as this may not be in line with WTO rules. The Commission plans to scrutinize the issue and present a proposal later this year. The revenues would directly contribute to the ‘own resources’ of the EU budget for the next seven years that would help finance the new €750 billion recovery plan. Stakeholders can deliver their contribution to the plan until 28 October.

Digital: fit for the COVID-19 reality

Following its pledge to make Europe ‘fit for the digital age’, the Digital Education Action Plan and the Digital Services Act are also high on the Commission’s agenda. The Digital Education Action Plan, due to be published in September this year, will be part of the Next Generation EU program. The COVID-19 crisis has seen schools and universities close their doors and increasingly turn to remote, digital teaching. The Action Plan aims to promote high-quality and inclusive education and training in the post-COVID digital reality. Feedback on the proposal can be delivered until 4 September.

Part of the Next Generation EU financing is the digital tax element of the Digital Services Act, to be presented by the end of 2020. The Digital Services Act is an attempt to regulate online platforms when it comes to illegal goods, product safety, political advertising and offensive content. The initiative may face intense debates before its approval, as previous attempts to implement an EU-wide Digital Taxation mechanism have so far been unsuccessful. The consultation remains open until 8 September.

Next steps

The Commission’s proposals on the above initiatives are expected before the end of 2020, except for the Energy Taxation Directive which is due in June next year. From the above-mentioned public consultations, it is evident that the European Commission is gearing up for a busy end-of-year period. Early (proactive) action is desirable for stakeholders that aim to represent their interests on these files, which will also be closely examined by the European Parliament and Council of the EU in 2021 (and later).

Want to know more about the upcoming initiatives, COVID-19, or other files that might affect your business? Please contact Dr2 Consultants to see what we can do for you.

The novelties of the new EU budget

On Tuesday, after almost five days of negotiations, the 27 Member States of the EU reached an agreement on a €1,074 trillion Multiannual Financial Framework (MFF), as well as a €750 billion Recovery Fund (Next Generation EU, or ‘NGEU’) for the period of 2021-2027.

The MFF sets out the EU budget for the coming seven years, setting funding priorities and dividing money amongst the different instruments. The long-term budget will, due to the COVID-19 outbreak, be accompanied by the so-called Recovery Fund called ‘Next Generation EU’. The NGEU will in part add additional funds to the existing European funding instruments, but also provide direct loans and grants to those Member States hardest hit by the pandemic.

Member States must leave behind their reservations on taxes and common debts

As was the case in previous EU budgets, Member States contribute a percentage of their gross national income (GNI) to the MFF. The funding of NGEU will, however, be unprecedented in the history of the EU, as it will be funded by the Union as a whole assuming loans on the capital markets. The EU-27 will borrow, through the European Commission, money from the capital markets. This means low interest rates, as all 27 Member States guarantee the loan.

Additionally, the loans will be repaid in part by raising the ‘own resources’ of the EU. These own resources will range from income from an EU-wide plastics tax to the introduction of a digital or financial transaction tax, a novelty in European tax policy where Member States traditionally firmly hold the reins.

Digital high on the agenda, or not?

The digital transition will remain one of the focal points of the EU budget. As such, important funding instruments such as Horizon Europe and Digital Europe are set to receive more funding compared to the current (2014-2020) budget, but less compared to the Commission proposal from May this year. The Digital Europe program, which finances the EU’s cyber defense and artificial intelligence development, will receive €6.80 billion during the coming seven years, a major increase compared to the millions it received in the previous financial framework. However, the proposed fund by the European Council is lower than the program was set to receive in the Commission proposal. Member States aim to streamline existing instruments into the InvestEU program. However, the new agreement downsizes the InvestEU budget to €8.40 billion compared to earlier proposals from the European Commission.

While the digital transition remains high on the agenda, the new EU budget does not draw exact parallels to the EU’s ambitiousness. While the current foreseen budget is higher compared to the current MFF, it lacks the firepower foreseen in the Commission proposal from May to push the EU to become a frontrunner in this area.

Sustainability as a main catalyst

The European Green Deal will also remain one of the main pillars of the EU budget in the European Council’s agreement. According to the new proposal, at least 30% of the total EU expenditure will have to contribute to climate objectives. The question remains exactly how the institutions will enforce the climate funding objective since the European Council remains very vague on the subject, a worry which is shared by the European Parliament.

In this context, the European Council invites the Commission to put forwards proposals for:

  • A carbon border adjustment mechanism, which will prevent the transfer of the production of goods to non-EU countries who happen to have less strict emission rules and ambitions;
  • A levy on non-recycled plastic waste, to be introduced in January 2021, of €0.80 per kilogram to discourage the generation of non-recycled plastic waste;
  • The revision of the Emission Trading System (ETS), to include a smaller amount of emission allowances in order to further boost carbon cuts and a possible extension to the maritime sectors.

Contrarily, the budget suffered several significant cuts during the negotiations in the sustainability policy area compared to the original proposal. For example, the flagship Just Transition Fund, intended to support carbon-intensive regions in the transition to a sustainable economy model, was heavily downsized from €40 billion to €17.5 billion.

Next steps

In order have the new EU budget operational by 1 January 2021, both the European Parliament as well as the national parliaments of the Member States need to approve the European Council’s proposal. However, both have voiced their skepticism towards the compromise that was reached. In the Member States, especially the national parliaments of the Netherlands, Austria, Denmark, Sweden and Finland are expected to take a critical stance. Starting September, we expect to have more clarity on the shape of next year’s budget. In an extraordinary plenary session on 23 July, the European Parliament passed a resolution voicing criticism of the EU budget deal in its current form.

Want to know more about the EU budget negotiations, COVID-19, or other dossiers that might affect your business? Please contact Dr2 Consultants to see what we can do for you.

Europe’s hydrogen revolution: the outlook for transport

On 8 July, the European Commission unveiled its long-anticipated Hydrogen Strategy, laying out a roadmap to make the EU the global leader in the hydrogen economy. The Hydrogen Strategy aims to foster the energy transition and act on the ambition of achieving climate-neutrality by 2050. The Commission aims to grow the share of hydrogen in the EU’s energy mix from the current 2% to 13-14% by 2050.

The momentum for hydrogen has grown in recent months. Market demand has significantly increased and the costs of renewable energy have decreased. Moreover, several Member States already published national hydrogen initiatives (e.g. Germany, France, the Netherlands). According to the Commission, a coordinated approach at EU level is necessary to scale up fast and streamline investment needs.

With the Hydrogen Strategy, the Commission charts the path towards ‘green’ hydrogen, based on renewable electricity (e.g. solar and wind energy). However, as green hydrogen is not yet cost-competitive against fossil-based hydrogen, the Commission acknowledges the potential of low-carbon hydrogen (e.g. Carbon Capture Storage) as a facilitator to scale up production and stimulate the market demand for hydrogen.

Hydrogen as enabler of emissions-free transport

The Hydrogen Strategy presents opportunities for the transport industry to act on the ambition of decarbonization and reducing CO2 emissions. Although electrification seems to be the most viable option on the short term, hydrogen is dubbed as the energy source for the future of transport. According to the Commission, the application of hydrogen in the transport industry is likely to develop through a gradual trajectory.

  • In the first phase (2020-2024), the objective is to produce up to 1 million tonnes of renewable hydrogen and to facilitate the take up of hydrogen consumption in commercial fleets (e.g. taxi’s) and specific parts of the railway network. Moreover, it could also be applied to heavy-duty transport, such as buses, lorries, coaches – currently responsible for about 6% of total EU CO2 emissions.
  • In the second phase (2025-2030), the objective is to make hydrogen an intrinsic part of an integrated energy system and to produce up to 10 million tonnes of renewable hydrogen. In this phase, green hydrogen should be cost-competitive with other forms of hydrogen production, but demand-boosting policies will be needed for the application of hydrogen in the railway sector and maritime transport (e.g. short-sea shipping and inland waterborne transport).
  • In the last phase towards maturity (2030-2050), renewable hydrogen and hydrogen-derived synthetic fuels could be applied to several hard-to-decarbonize modes of transport, such as aviation and deep-sea shipping, although the Commission acknowledges more research and innovation efforts are required to realize these ambitions.

In order to realize the hydrogen ecosystem and trajectory for transport, the Commission opts for an integrated value chain approach. In doing so, the Commission incorporates several aspects which are necessary to facilitate the hydrogen transition, ranging from infrastructure (e.g. the deployment of hydrogen refueling networks for the different modes of transport) to production techniques and market regulation (e.g. EU incentives to stimulate demand-side support policies).

The Commission is still exploring further renewable hydrogen appliances in the transport industry. This broader uptake of green hydrogen in the transport sector will be reflected in the Strategy for Sustainable and Smart Mobility, which is due for publication in the fourth quarter of 2020, and for which the public consultation has recently opened

Stimuli for the Hydrogen revolution

The Clean Hydrogen Alliance, a Commission-led coalition that brings together industry, governments and civil society, will identify a robust pipeline of projects to accelerate the upscaling of hydrogen production. The Alliance will be strongly anchored in the hydrogen value chain, covering green and low-carbon hydrogen from production via transmission to mobility, industry, energy and heating applications.

Financial instruments such as InvestEU, the Horizon partnership for clean hydrogen and the Cohesion Fund, which will expectedly be topped up by financial resources from the €750 billion Next Generation EU Recovery Fund, will help drive clean hydrogen past its tipping point.

All eyes on Berlin as Germany starts the Council Presidency

On 1 July, Germany took over the Presidency of the Council of the EU from Croatia, for the second half of 2020, which is already dubbed the ‘Corona-Presidency’. The upcoming six months will bring historic challenges as the management of the recovery from the current health crisis will coincide with some fundamental political choices in the EU, and the outcome will determine the future direction of European integration.

As one of the most powerful Member States of the EU takes over at this crucial moment in time, it will have to play multiple roles at the same time.

Crisis management

First and foremost, the German Presidency will have to play its role as ‘crisis manager’ in the context of the COVID-19 pandemic. Based on epidemiological developments and assessments, the German Presidency will seek to increase coordination in Europe to gradually return to a fully functioning Schengen Area. Furthermore, Germany is expected to lead the politically complicated negotiations on potentially expanding the list of third countries from which travel to the EU is allowed. These priorities will be central during the whole German Presidency mandate.

EU budget negotiations

Germany will also take an active part in managing the negotiations on the new Multiannual Financial Framework (MFF) 2021-2027 and the Next Generation EU Recovery Fund during the summer months. The main challenge will be to find common ground between the hard-hit Member States, such as Italy, Spain and France on the one hand, and the ‘frugal four’ – Austria, Denmark, the Netherlands and Sweden – on the other hand, with the latter group being against grants as part of the Recovery Fund. Germany will be directly responsible for the legislative work on the different sector programs within the MFF (e.g. Horizon Europe, Just Transition Fund and InvestEU) and the Recovery Fund, and will lead the trilogue negotiations with the European Parliament on the financial framework, once there is political agreement on the general features of the future budget. France and Germany expressed their ambition for a quick agreement by end of July, as European leaders are set to meet face-to-face on 17 and 18 July.

Brexit negotiations

With the Brexit transition period ending on the 31 December 2020 and the United Kingdom declining the opportunity to extend this deadline, the German Presidency will have yet another prospective challenge. Once an agreement has been reached at European Commission level, the Member States will have to give their consent. German EU ambassador Michael Clauss stressed that Germany will be exclusively focusing on “brokering agreements between the 27”.

The German Presidency program expresses the Presidency’s ambition for a comprehensive partnership between the EU and the UK. However, it also reads that the Member States will not accept an agreement that would distort fair competition within the Single Market. If there is an acceptable agreement before the end of the year, the German Presidency is expected to align Member States in its role as ‘Brexit-Broker’.

Work program

The work program sets out, in broad terms, the policy priorities for the second half of 2020. In general, Germany will prioritize the digital and green transitions throughout all of its activities. The German Presidency is committed to an innovative Europe based on three pillars: expanding the EU’s digital sovereignty, enhancing competitiveness and a sustainable and stable financial architecture. It will also ensure that the Green Deal’s implementation will contribute to the recovery from the COVID-19 pandemic in Europe.

The German Presidency will have an extremely challenging task of fostering European unity in the budget negotiations in the face of existing difficulties such as the COVID-19 crisis and Brexit. For more information on the German Presidency’s sector-specific priorities, please read our analyses of the German priorities in the fields of digital & tech, sustainability and transport: