Friday, July 31, 2009

Open Europe press summary: 31 July 2009

Europe

US government to monitor Europeans' bank transactions under controversial EU proposal;
Swedish Parliament's EU Scrutiny Committee was notified via text message 30 minutes before decision was made
The Swedish media reports on a controversial EU proposal that would grant the US government access to all bank transactions in the EU through the SWIFT system. SWIFT operates a worldwide financial messaging network which exchanges messages between banks and other financial institutions, with around 15 million SWIFT transactions occurring every day.

The secrecy surrounding the decision has been subject to widespread criticism. As has been reported throughout the week, EU ministers decided to ignore their own legal experts' advice which said that the European Parliament should have co-legislative powers on the issue. Instead, the Council of Foreign Ministers on Monday decided to give the Swedish Presidency the exclusive rights to handle the talks with the US. Prominent Swedish blogger and member of the Pirate Party, Henrik Alexandersson, argues that the decision to cut out the EP and give the Swedish Presidency exclusive negotiation powers, will mean that it will be virtually impossible for citizens to hold politicians to account over the possible privacy breaches that the decision will lead to.

Meanwhile, Swedish Television notes that the Swedish Parliament's EU Scrutiny Committee - which must give its assent before the Swedish government signs up to an EU decision - was given only 30 minutes notification via a text message to prepare a decision, and was given no documents to inform it on what the decision was about. Alexandersson argues that the Swedish Government might knowingly have withheld information from the Parliament to avoid debates and protests.

Meanwhile Deutsche Welle reports that EU Justice Commissioner Jacques Barrot has said the EU will "ensure full, perfect reciprocity", and insist on equal access to US bank data.
Alexandersson's blog EU Observer Aftonbladet Europaportalen Deutsche Welle

Briton fighting extradition under EU arrest warrant
The Evening Standard looks at the story of Deborah Dark, a British citizen who is fighting extradition to France under the EU's European Arrest Warrant for an alleged cannabis offence 20 years ago. A French court acquitted her but neither she nor her lawyer was informed that the French prosecution later appealed the decision and she had been sentenced to six years in prison, in absentia.

For the next 15 years, Dark travelled undisturbed to France, unaware of her status as a wanted convict. The article notes that "so it might have continued but for creation of the European Arrest Warrant, enacted in 2003, to enable the fast-track extradition of terrorist suspects. This changed everything. In 2005 a public prosecutor in Pau applied for and was granted a European Arrest Warrant against her." The article notes that Dark "remains stuck in a Catch-22 situation" because although both a Spanish court and Westminster Magistrates Court have refused to extradite her, due to "passage of time", she is unable to clear her name without returning to France, risking a retrial.

Free Trials International has said that changing the legal system and amending European law made by the Justice and Home Affairs Council of the European Union will require key British politicians to take up her case, which the article notes "could be a long, hard road." The article quotes her saying, "The Home Office say they can't help, my MEP, Baroness Sarah Ludford, hasn't responded to my numerous emails and pleas for help. Everywhere I turn, they pass the buck."
Evening Standard OE blog

Irish MEPs criticise abortion petition
Irish MEPs in the Alliance of Liberal and Democrats group of the European Parliament have criticised two of their colleagues, British MEP Sarah Ludford and Dutch MEP Sophie in't Veld for signing a petition asking the EU to make abortion available in Ireland.

The petition, which has gathered 3,947 signatures, aims to use the "citizens' initiative" clause in the Lisbon Treaty which promises that if one million signatures are collected from European citizens on a particular issue, the European Commission must consider proposing legislation.

Meanwhile the Irish Times reports that journalist Nell McCafferty yesterday launched a "Women for Europe" campaign, saying that she wants to live "under the protection of the EU" and not "in a country ruled exclusively by (an) Irish government". The new campaign to support a "Yes" vote in the Lisbon Treaty referendum claims that the Irish government wants to make women "barefoot, pregnant and back at the kitchen sink", but that by voting "Yes", the rights of Irish women would be protected.
Irish Times Irish Times 2 OE blog

Common EU embassies under Lisbon Treaty would be bad news for human rights
Nathan Shachar argues today in an opinion in Swedish daily DN that the idea of common EU embassies would be bad news for human rights. In order to establish common embassies, EU member states must have shared national interests and this is not the case. Sweden wants to promote human rights in Cuba while Spain and France see investment opportunities and ignors human rights abuses, so common EU embassies would mean that Sweden could be overruled. He adds, "If the Lisbon Treaty is ratified and we submit our diplomacy to the EU our ability to promote a dissenting view will cease".

Comment: The EU Lisbon Treaty paves the way towards common EU embassies, by creating an "EU External Action Service", and by allowing the EU to determine rules on diplomatic and consular protection by qualified majority vote. In 2005 this led Spanish Prime Minister Jose Zapatero to conclude: "We will undoubtedly see European embassies in the world, not ones from each country, with European diplomats and a European foreign service." (Associated Press, 17 February 2005)
OE guide to the Lisbon Treaty DN

Treasury clamps down on fraudulent transactions of EU's carbon permits
The FT reports that, in order to clamp down on fraud, the UK Treasury has imposed a zero rate of value added tax (VAT) on carbon credits traded within the EU's emissions trading scheme, designed to reduce carbon emissions across the bloc. The article notes that the move is highly unusual because changes to VAT need to be agreed by the European Parliament. The decision to press ahead with the change without prior permission reflects the severity of the threat posed by the fraud.

The fraud, known as "missing trader intra-community fraud", can arise because goods or services are allowed to be traded VAT-free between member states. It occurs where the UK company purchasing the emissions allowances from overseas sells them to another UK company, charges VAT but then fails to pay it to Revenue and Customs, and disappears.

The paper notes that the ability to trade freely in emissions allowances is an important feature of the EU emissions trading scheme but it exposes the market to fraud because of the high volume, value and speed of the trades. Moreover, the fact that the allowances are surrendered only once a year provides fraudsters with opportunities to steal VAT following cross-border acquisitions.
FT

Declan Ganley: "There is a culture of opposition to real choice in the EU"
Writing in Europe's World, Declan Ganley, the founder of Libertas, argues that although the theme of the EU's campaign for the European Parliament elections was 'It's Your Choice', "there is a culture of opposition to real choice in the EU". He goes on, "If Europe's laws are to have primacy over national sovereignty then those laws must be decided on by elected officials. Similarly, we should have fewer meetings, and those we do have should be held in the open and not behind closed doors, and we should all be allowed to know how MEPs are spending our money."
Europe's World: Ganley

UK Government to launch inquiry into impact of EU AIFM Directive;
Swedish Minister: It is "obvious" that hedge funds need regulation
An article in the WSJ reports that the Government yesterday launched an inquiry into the EU's proposed Alternative Investment Fund Managers (AIFM) Directive. The article notes that the inquiry will focus on "whether a pan-European regime is necessary and whether the E.U. has consulted adequately" as well as "the risks and benefits associated with alternative investments and whether the proposals will help to create a more transparent market or whether they go too far and are likely to damage London as a financial centre".

An article in Hedgeweek reports that Luxembourg could benefit from the Directive, suggesting it "could help to solidify the country's position as a burgeoning domicile and servicing centre for alternative funds".

Meanwhile SvD reports that the Swedish Minister for Financial Markets, Mats Odell, has said it is "It is obvious that hedge funds and venture capital funds need regulation" and notes that the Swedish "government together with the Commission and the member states will try to find a suitable solution". He also reportedly wants to introduce new common rules on bonuses for bankers throughout the EU, as part of the Capital Adequacy Directive.
Hedgeweek WSJ SvD DI

Chairman of Paris Europlace: "Paris has resisted the crisis better than London"
In an interview with Le Figaro, Gerard Mestrallet, the Chairman of Paris Europlace (the leading association representing Paris' financial district), says "Paris has resisted the crisis better than London, thanks to the quality of its regulation and the solidity of its financial institutions". He says, "We are not obsessed with competition with London", adding that "We want the most efficient and competitive financial industry" so that the French economy performs to its best ability.
Le Figaro

In a letter to the FT, the Directors of Employment Policy at organisations including the Institute of Directors and the CBI argue that the Government must take care when implementing the EU's Agency Workers Directive to cause the least damage to the temporary working sector, and that implementation should not take place before Autumn 2011, the latest possible date.
FT: Letters

Bill Carmichael: "Sensible response" would be to delay implementing EWTD
Writing in the Yorkshire Post, columnist Bill Carmichael looks at the reduction in junior doctors' hours from 56 to 48 hours a week under the EU's Working Time Directive (EWTD), due to come into force tomorrow. He writes that "The sensible response would be to postpone the introduction of the EWTD until the danger from swine flu has passed...that is precisely what the Royal College of Surgeons and RemedyUK have recommended to the Government. But their pleas have fallen on deaf ears."
Yorkshire Post Open Europe research OE blog

IMF loan to Iceland linked to political row with Britain over banking collapse
The IMF has delayed handing over the second tranche of Iceland's emergency bail-out loan and the Telegraph reports that it is thought to be linked to the political row over compensation for Britain's Icesave customers, as opposition grows in Iceland to the terms of a loan from Britain and the Netherlands to help the country cover the liability.
Telegraph

Charlemagne: The EU needs to decide on its foreign policy goals
The Economist's Charlemagne column looks into the reasons why the prospect of Tony Blair becoming the future President of the EU Council has been received with so much hostility, saying that the animosity is not due to Mr. Blair's actions as Prime Minister, but rather to a fear of "what a President Blair would say about the EU, and its foreign-policy goals". It goes on to argue, "It is time that Europeans had a proper debate about the global presence they want".
Economist: Charlemagne OE blog

EU softens measures on bank lending - reform likely delayed until 2010
Although EU finance ministers agreed on 7 July to tighten the criteria for bank loans given as state aid, the FT Deutschland reports that EU Internal Market Commissioner Charlie McCreevy is moving away from setting a fixed upper limit for bank debts. The FTD cites a source close to the Commission saying, "There is strong resistance of governments who do not want a fixed quota". This reportedly includes Germany. The Commission is supposed to present legislative proposals on new capital requirements for banks on October 2009, but now the legislative proposal is expected to be delayed until 2010.
Financial Times Deutschland

On his Telegraph blog, Conservative MEP Dan Hannan refutes claims that the leader of the European Conservatives and Reformists group in the European Parliament, Michal Kaminski, is anti-semitic.
Telegraph: Hannan blog Independent: Letters

TurquieEuropeene looks into the 'partnership' between Turkey and the EU proposed by the German and French governments, and quotes German Foreign Minister Frank Steinmeier saying, "I'm not sure what the notion of privileged partner really means".
TurquieEuropeene

The European Commission has announced that airlines may not prevent potential swine flu sufferers from boarding an aircraft, warning that airlines can only take such measures on orders from a public authority.
EUobserver USA Today

The WSJ reports that the IMF is urging eurozone policy makers to sustain fiscal stimulus next year and keep interest rates low.
WSJ Irish Independent Economist La Tribune Europaportalen

A leader in the WSJ looks at the EU's decision to impose import tariffs on Chinese steel pipes and argues that this is a "mundane antidumping case" and concludes, "Europe can't afford to shoot itself in the foot with these tariffs."
WSJ: Editorial Tax News

Handelsblatt reports that, for the first time, the European Commission has banned a lobby group from its voluntary register of lobbyists, for failing to give a correct declaration of the costs of its lobby work.
Handelsblatt

The Economist argues that Spanish Prime Minister José Luis Rodríguez Zapatero risks prolonging the recession with his populist policies.
ABC Expansion Economist: Leader

The Austrian People's Party (ÖVP) has officially named former Vice Chancellor Wilhelm Molterer as their preferred successor to EU Commissioner Benita Ferrero-Waldner. However, Chancellor Werner Faymann of the Social Democratic (SPÖ) - the ÖVP's coalition partner - reacted to the news saying: "It is too early to discuss names."
Austrian Times Die Presse

UK

Foreigners face ban on paying for UK transplants
New rules being considered by the Government will mean that foreigners will not be able to receive transplants in the UK as private patients. This comes after it was discovered earlier this year that fifty British donor livers were given to foreign patients over a two-year period.

The BBC reports that in the past 10 years the UK has sent more than 300 organs to other EU states, but received only 120 in return.
Telegraph BBC

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: openeurope.org.uk or call us on 0207 197 2333.

Thursday, July 30, 2009

Open Europe press summary: 30 July 2009

Europe

EU propaganda: Commission allocates €885m to promote a "common European identity" among young people
In an opinion piece on EUobserver, Open Europe's Lorraine Mullally looks at the EU's growing use of propaganda to 'sell' the idea of European integration, and argues that the European Commission "sees itself not just as 'guardian of the Treaties', but as a political campaign group." She cites the recent interventions made by the Commission in the Irish debate on the Lisbon Treaty, as well as the attempt by the Commission communications department to slander Open Europe in the Swedish media after the think-tank criticised EU communications policy.

She says: "With so much public money at their disposal, the EU institutions are able to propel their own vision of the future of Europe, and also begin to create a monopoly over what should be regarded as the 'facts.' The institutions claim to want a wider debate on Europe, but by trying to suppress those who do not support their vision, they are stifling debate." She argues: "Without doubt, there is a clear need for citizens to become better educated about the European Union and what it does - especially given the fact that, as the European Parliament has confirmed, EU legislation is now at the root of the majority of laws enacted in its member states. But the European Commission - and no doubt far too many MEPs - still do not understand the difference between providing much-needed information and 'selling' the EU."

Open Europe's December 2008 research on the EU's propaganda budget is also cited in a piece on the International News Service by David Haworth. It notes that "The Commission has allocated from 2007 to 2013 the sum of Euro 885 million on trans-continental efforts to promote a 'common European identity' among the under-25s in a campaign which deliberately confuses the difference between information and propaganda". It continues: "The Centre for European Policy Studies, a think tank which claims to be independent, was on the take through the Commission of some € 6.1 million two years ago of taxpayers' cash. Indeed, the Brussels undergrowth is thick with such bodies - all 'thinking', but who never seem to produce any monographs of intellectual distinction by comparison with their Washington counterparts. The difference is that such USA bodies are privately funded - not subsidised by the authorities they are supposed to be examining."
EUobserver International News Service OE research OE blog

Christine Lagarde: Key financial actors to meet in September "to prepare a response" to attract hedge funds
In an interview with Les Echos, French Finance Minister Christine Lagarde plays down the relocation of the equity platform data centre of NYSE Euronext from Paris to London. She emphasises the need "to not overestimate the importance of this decision" as the main part of NYSE Euronext will remain in Paris and only approximately 10 people and an IT centre are moving to London.

Responding to how London continues to attract financial companies from France, Lagarde said "some years ago the British boasted of their 'light regulation' and emphasised their fiscal regime. Today, the gap between France and Great Britain has reduced noticeably on this issue".

When asked how Paris can attract hedge funds in particular, Lagarde says that she intends on inviting all the key actors in Paris' financial district (La Place) to meet in September to discuss the development of the financial district and "to prepare a response". She also said that France will continue to develop "sectors of excellence", but notes that this "perhaps will not be the management of hedge funds".

With regard to financial supervision, Lagarde adds that she thinks France has a still has "the lead on the Americans and the British in the adaptation of our system of financial supervision".
Les Echos

Sharon Bowles: AIFM Directive "must be profoundly amended if we want it to work"
In an interview with AGEFI, the new Chair of the European Parliament Economic and Monetary Affairs committee Sharon Bowles says that the EU's Alternative Investment Fund Manager Directive, "must be profoundly amended if we want it to work", warning that should the directive come into force, pension funds would no longer be able tp invest in European products" and leaving the UK, Germany and France for Dubai and Singapore.

This she adds means that "it is no longer a financial problem but a social problem", adding that "It is possible to make the text fairer and more intelligent". When asked how, she responds "We already said in the Rasmussen report (on alternative management) and in the Lehne report (on transparency) that we want capital requirements for all financial institutions, but that these requirements must be based on risk." With regard to alternative investment funds she says "It involves ensuring the stability of management, the survival of the institution if there is a crisis, as long as necessary, to close activities correctly. The requirements will therefore be different for hedge funds which carry out a lot of short term investment and where the management is very directly active, on one hand, and for private equity, on the other hand, where the management is housed in portfolio companies and doesn't therefore disappear with the fund".

Meanwhile, the Telegraph quotes the CEO of RAB Capital, Stephen Couttie, in a letter to investors, warning of how the AIMF Directive could impact on RAB Capital. In the letter, Couttie says "The Directive touches on several issues relevant to RAB's funds such as leverage, marketing, valuation, liquidity and custody".
AGEFI OE blog Telegraph Letter to investors

German Federal States agree on Bundesrat influence over EU decision-making
While there are ongoing disputes at the party level on how much power the German parliament will have in the EU decision-making process, the German Länder (federal states) have widely agreed on the future influence of the Bundesrat (upper house of parliament) in EU matters. A formal resolution of the European ministers of the various Länder is expected tomorrow. The final decision on the new law specifying the Parliament and Bundesrat powers over EU decisions will come up at 8 September (voting of Parliament) and 18 September (voting of Bundesrat).
Tagesspiegel Reutlinger

EU report shows discrepancies over use of European Arrest Warrant
European Voice reports that a new report for the Council of Ministers has shown that there are wide disparities between member states in the number of European Arrest Warrants (EAWs) requested, and even wider gaps between the number of EAWs requested and the number issued. For example, Hungary received 14,393 requests to arrest people in 2008, but only 113 people were arrested under an EAW, and of that number, 95 were sent to the requesting state. However, ten member states, including the UK, Italy, the Netherlands and Romania, did not supply any information for the report.

The article notes that a separate report issued in May revealed that while some member states examine each arrest warrant request to check if the crime is serious enough to transfer a suspect to another member state, other EU countries consider such a check superfluous.
European Voice OE blog

PA reports that the Director of the British Chambers of Commerce, David Frost, has written to the Business Secretary Lord Mandelson warning that the EU's Agency Workers Directive, which would give temporary workers the same rights as permanent ones, could cost the private sector at least £1.5 billion. A Government consultation on the directive ends tomorrow.
OE blog Open Europe press release OE briefing

New survey shows 60% Irish voters have some understanding of Lisbon Treaty;
Referendum Commission to distribute material on Treaty
The Irish Times reports that a new survey of 500 Irish voters by Behaviour Attitudes, carried out for the Irish Referendum Commission, has found that 60 percent of Irish voters say they have at least some understanding of the Lisbon Treaty, compared to 44 percent days before the referendum last year. 38 percent said they understand the Lisbon Treaty to some extent, 18 percent understand it quite well and 4 percent understand it very well.

The poll also showed an increased intention to vote, compared with April 2008, with 91 percent extremely or quite likely to vote, and 9 percent quite or extremely unlikely to vote.

Writing for the Irish Times Frank Clarke, Chairman of the Referendum Commission, argues that although the Treaty is a "complex document", he wants to "reject the patronising talk that 'ordinary people' could not possibly understand the Lisbon Treaty". He goes on, "In about a month's time every household in Ireland will receive a leaflet from the [Referendum] commission detailing the main provisions of the treaty and explaining some key issues". However, he adds that "Since the referendum on the treaty in June of last year, the treaty itself has not changed."
Belfast Telegraph Irish Times Open Europe briefing OE blog Irish Times: Clarke European Voice

MEP Cohn-Bendit: the proposal to nominate Tony Blair as first President of the European Council is absurd
The FT Deutschland argues that "Tony Blair failed too often as a European and as a statesman in order to represent the EU in the world." According to the article MEP Daniel Cohn-Bendit believes the proposal to nominate Tony Blair as first president of the European Council is absurd. The first person who assumes the office will contribute largely to shape the outlines of the new post - and a worse nomination for this post than Tony Blair is hardly imaginable, writes the paper.
Financial Times Deutschland OE Blog

Lords committee attacks "very frustrating" EU CAP budget
PA writes that in a new report the House of Lords EU committee has attacked the EU's generous farm subsidies saying it is 'disappointing" and "very frustrating" that a huge portion of the EU budget was spent on the CAP rather than on fighting the financial crisis. Baroness Cohen of Pimlico said: "At a time where it is clear that Europe's economy needs major economic stimulus it is very frustrating that so much of the EU's spending continues to be channelled to agricultural spending that provides very poor value for money".
PA HoL report Scotsman

Member states ignore their own legal advice in excluding MEPs from US data sharing talks
EUobserver reports that EU member states ignored the advice of their own legal experts in cutting MEPs out of talks with the US on access to data held by SWIFT. The new data pact will give US Treasury officials the right to access EU citizens' banking transactions to investigate potential terrorist activity. This week EU foreign ministers opted to give the Swedish EU Presidency the exclusive right to handle talks despite a confidential paper from the legal services of the EU council which said that the European Parliament should have co-legislative powers on the pact.

Meanwhile, according to Faz, loud protest against EU-US agreement on sharing sensitive bank date seems to come only from German politicians. The sharp voices caused irritation at the EU Commission who feels wrongly treaty to be in the pillory.
EUobserver FAZ

Attacks continue on Conservatives' alliance in the European Parliament
In the New Statesman, James Macintyre looks at Michal Kaminski, the leader of the Conservatives and Reformists group in the European Parliament, which includes the 24 Conservative MEPs. He writes that Kaminski "belongs to Poland's Law and Justice Party, one of whose MPs, Artur Górski, described the election of Barack Obama in the US as 'a disaster' and 'the end of the civilisation of the white man'".
Independent: MacShane Guardian Guardian: Garton Ash New Statesman: Macintyre

New study: EU code of behaviour is insufficient - Commissioners take liberties when it comes to second jobs
A new study, commissioned by the European Parliament, has concluded that
the code of behaviour for the EU Commissioners leaves too much room for political activities outside the Commission. Furthermore the specifications in order to prevent financial conflict of interests are too vague. The German CDU party is demanding amendments to the code of behaviour and making the result dependent on the re-election of Commission President Barroso.
Handelsblatt

Constitutional law expert appeals against EP election to the German Parliament
According to German magazine Focus, constitutional law expert Hans Herbert von Armin has challenged the results of the European Parliament elections in front of the German Parliament. Von Arnim argues that the Constitutional Court's recent judgment on the Lisbon Treaty clearly shows that the five-percent threshold cannot be justified at EP elections, and that: "eight MEPs...received their mandate wrongly and have to return it". If the Parliament rejects his appeal, he will bring the case in front of the German Constitutional Court.
Focus

European Voice reports that the Swedish government is making preparations for an extra EU summit in Brussels in mid September to discuss a common position for the G-20 summit which will be held on 24- 25 September.
European Voice

European Voice reports that the EU Commission has organised to send more than 100 EU staff to monitor the presidential poll in Afghanistan, making it one of the largest EU missions.

Meanwhile, the IHT reports that after a plea from the US for Europe to bolster its troops in Afghanistan, Spanish Prime Minister José Luis Rodríguez Zapatero announced that he would increase the country's forces in the North West region of Afghanistan.
European Voice IHT

Greenpeace and Friends of the Earth Europe criticise the European Food Safety Agency (EFSA) for allowing the cultivation of MON810 corn, a GMO product banned in 6 member states for the unknown risks it may carry for health and the environment, Pleinchamp writes.
Actuenvironnement Pleinchamp

Poland will not be able to join the euro by the target date of 2012, the country's Deputy Finance Minister, Ludwik Kotecki, said yesterday.
FT

Expansion reports that the European Commission yesterday warned some member states, including Spain, to correctly apply the directive on sexual discrimination in the workplace.
Expansion

EurActiv reports that French gas utility GDF Suez is likely to join the Nord Stream pipeline project, bringing Russian gas directly to Germany, bypassing Ukraine.
EurActiv

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: openeurope.org.uk or call us on 0207 197 2333.

Wednesday, July 29, 2009

Open Europe press summary: 29 July 2009

Europe

Government reveals City firms contributed £32.5bn in tax revenue in a year;
Refuses to produce Impact Assessment for important new Directive
City AM reports on Open Europe's Freedom of Information request which found that the Government will not conduct an impact assessment on the AIFM Directive before negotiations. It reports:"Chancellor Alistair Darling is refusing to investigate how much European plans to crackdown on hedge funds will cost the industry. The Treasury has admitted it will not carry out an 'impact assessment' on an EU draft law which could damage London's position as a global hedge fund centre by imposing a strict disclosure regime and leverage limits. The government's own guidelines say it should commission a study into any EU legislation that could burden British businesses with extra costs." The article quotes Open Europe Research Director Mats Persson saying, "The UK government is behind the curve on this and they are breaking their own principles on better regulation."

Meanwhile, the Guardian reports that a Parliamentary question from Lord Pearson of Rannoch has revealed that City firms contributed £32.5bn in tax revenue in the year to March 31, 2009 - enough to pay for the entire public security budget - including police, fire brigade, law courts and prisons, according to the paper. However, this is less than half the £67.8bn they brought in two years earlier.

In an interview with the FT Sharon Bowles, the new Lib Dem Chair of the European Parliament's Economic and Monetary Affairs Committee, said that if the EU's proposed Alternative Investment Fund Managers Directive (AIFMD) was implemented unchanged, European pension funds and institutional investors faced "excommunication" from global capital markets. She also said there was a risk of "unintended consequences" to the draft directive, adding "Now we have to fix bits to make it workable".

The paper reports that one of her first moves as Chair has been to draw committee members' attention to the non-EU aspects of the proposed rule changes, with plans being made to discuss the issues with visiting US congressmen. However, she warned the hedge fund industry against posturing, saying "The UK hedge fund mood music just puts people's backs up". She also said she had sat through several meetings "with the usual suspects saying the same things." She added, "The directive is not only about hedge funds and private equity - it covers everything in between," and urged mainstream investors to "make themselves heard".
CityAM Smart Brief FT FT 2 OE blog Guardian

EU justifies huge propaganda spending as insignificant compared to the rest of EU budget
EUobserver reports that Maria Rankka, Head of the Swedish think-tank Timbro and former speechwriter for Swedish Foreign Minister Carl Bildt, has accused the EU of creating an illegitimate "propaganda machine." A recent study from Timbo argues, "The EU, at the tax-payers' expense, actively advocates more European integration and prevents free debate on the future of Europe, extending the limits of what we normally regard as communication". EurActiv quotes the report saying, "the EU wants more integration in Europe, despite the fact that Europeans are more hesitant."

The report draws on research from Open Europe's December 2008 publication, "The hard sell: EU communication policy and the campaign for hearts and minds", which found that the EU spent €2.4 billion on propaganda in 2008 alone. One example found that schools wanting to benefit from Brussels' €69 million a year free milk scheme must display an A3-format poster outside their canteens showing the EU flag and stating that EU money paid for the drink.

Paulina Neuding, from Swedish daily SvD, remarked that the EU's Commissioner for Information, Margot Wallstrom, made matters worse yesterday as she attempted to defend the EU's propaganda effort by suggesting the information budget is insignificant in relation to the size of the whole EU budget.
SvD Timbro's report EU observer EurActiv Open Europe research: The hard sell

EU will renew a deal allowing US officials to scrutinise EU bank activities
In order to prevent funding of terrorist groups, the EU has agreed to further allow US officials to monitor Swift bank transactions in the EU, the BBC reports. The deal has received criticism from EU politicians, with many calling for guarantees that citizens' privacy laws are not being violated.

Handelsblatt reports that the German CSU party plans to veto the re-appointment of Barroso, saying it was "unacceptable" that the US bank scrutiny deal was struck without the consent of the European Parliament. "We must stop the foreign ministers, and ensure a parliamentary reservation for Germany, so that the Bundestag can still undo the worst", CSU leader Alexander Dobrindt said.

In Presseportal, German Green MP Alexander Ulrich says "with regard to handing out Europe's citizens' bank data to US authorities, neither the national nor the European parliament have been consulted", criticising the Commission's dictating role on the basis of the internal market.
BBC Handelsblatt Presseportal Berlin Kontor

EU tries to avoid 'visa war' with Canada
Agence Europe reports that the European Commission and the Swedish EU Presidency are trying to find a solution to a diplomatic row between Canada and the Czech Republic, after Canada unilaterally introduced visas for Czech nationals this month.

The article notes that the Czech Republic has retaliated by imposing visa requirements on Canadian diplomats, a power that still lies with member states, but is unable to unilaterally introduce visas for all Canadian nationals as this would be in violation of Community law. This month, the Vancouver Sun reported that Sweden's Migration and Asylum and Policy Minister Tobias Billstroem indicated that the EU may issue retaliatory measures: "As the presidency of the EU, we are in favour of this reciprocity."
National Post Prague Monitor Vancouver Sun

French EU Affairs Minister: "no enlargement while the Lisbon Treaty is not in force"
At a press conference yesterday, French Foreign Minister Bernard Kouchner addressed whether the European Commission could decide on Iceland's application for EU membership before the end of the year. Kouchner and his colleague European Affairs Minister Pierre Lellouche emphasised that Iceland was not being prioritised over the Balkan countries but that its status would facilitate accession negotiations. However, Lellouche added that there should be "no enlargement while the Lisbon Treaty is not in force".
French government

CSU attacks German Foreign Minister Steinmeier
German FAZ reports that the CSU party blames Foreign Minister Frank Walter Steinmeier for neglecting the interest of German bank clients. According to CSU General Secretary Alexander Dobrindt, Steinmeier has committed a grave mistake by giving full authority to the EU Commission on the negotiations concerning the EU-US data sharing agreement. Furthermore, the online press service Berlin Kantor quoted Dobrindt saying "We have to stop the access of US authorities on German bank accounts". Meanwhile, News ad hoc reports that Luxembourg's Foreign Minister Asselborn rejects German criticism on the EU-US data sharing agreement. He emphasizes that the agreement is only valid for one year until the Lisbon Treaty comes into force.
Faz Berlin Kontor News ad hoc

US calls on EU member states to match its humanitarian aid to Afghanistan and Pakistan
The Guardian reports that Barack Obama's special envoy for Afghanistan and Pakistan, Richard Holbrooke, has complained that the fate of 2 million refugees in Pakistan's Swat valley is not being taken seriously enough in Europe, judging by the money being offered to deal with the crisis. Speaking to senior EU and Nato officials in Brussels, he demanded that Europeans "step up to the plate" and at least match the $335m the US has made available.
Guardian

An article in the WSJ reports that EU trade officials approved pre-emptive penalties on imports of steel pipe from China, describing it as "a precedent-setting move that suggests the trading bloc is growing more protectionist in the face of the economic downturn."
WSJ

EU foreign policy chief Javier Solana has announced that the EU will train Somali security forces to tackle pirates operating along the country's coast. French Foreign Minister Bernard Kouchner has complained that "France is the only one for the moment that is determined to do anything. I hope that will change."
BBC

According to the Austrian Times, current Foreign Minister Michael Spindelegger backed his predecessor Ursula Plassnik to take over from Javier Solana as the EU's High Representative for Common Foreign and Security Policy and Secretary-General of the Council of the European Union. Solana has said he will step down in October this year and when asked about a replacement Spindelegger said: "Naturally, we have great interest in that post. Plassnik would make a very-good candidate on the basis of her experience."
Austrian Times

Frances opposes outside monitoring for Georgia
EUobserver writes that France has spoken out against proposals to add US or Turkish personnel to the EU monitoring mission in Georgia. Italy, Cyprus and Belgium also voiced opposition to third party deployment. However, The UK, Finland, Lithuania and Estonia are continuing to campaign for outside intervention.
EUobserver Monde

European Voice reports that the EU Commission yesterday released a second instalment of the emergency € 3.1 bn loan package for Latvia, and a first instalment of €1.5 bn of crisis support for Romania. These loans form part of the EU's agreed total of €14.6bn in emergency loans to sovereign states.
European Voice EurActiv FT Figaro

Morocco is the first North African country to be granted a "special status" by the EU. The cooperation between Morocco and the European Union have strengthened in the last decades and now cover a new partnership in economic, trade, socio -ultural issues, as well as political issues.
Le Matin

The Coulisses de Bruxelles blog reviews Belgian MEP and former EU Commission employee Derk-Jan Eppink's new book on "plots, lies and betrayals in the European Commission". The blog notes that Eppink "shows that the complex Brussels machinery is often on autopilot".
Coulisses de Bruxelles

Writing in the FT, former EU Competition Commissioner Mario Monti urges key global competition authorities to make a strong pronouncement explaining why continued, vigorous competition enforcement is crucial during the global economic crisis.
FT: Monti

Spanish Foreign Minister Miguel Angel Moratinos said he would push for a sanction plan on Honduras, similar to that issued by the US. The EU has already stopped financial aid to Honduras.
Handelsblatt Reuters Deutschland

La Razon reports that yesterday the EU definitively approved new regulations which oblige rating agencies to register and be monitored. Member states will have six months to apply the new regulations.
La Razon

UK

A ComRes survey for the Independent has put the Conservatives on 42 percent - six points better than when the same poll was taken last month. Labour is on 24 per cent, down one point, and the Liberal Democrats are on 16 percent, down four points. Conservative Home notes that according to UK Polling Report, these figures would compute into a Commons majority of 140 for David Cameron.
Express Conservative Home UK polling report

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: openeurope.org.uk or call us on 0207 197 2333.

Tuesday, July 28, 2009

Open Europe press summary: 28 July 2009

Europe

UK Government admits it will not produce an Impact Assessment for controversial EU proposal on alternative investment
In a response to a Freedom of Information request put forward by Open Europe, the UK Government has admitted that it will not produce an Impact Assessment for the EU's proposed Directive on alternative investment funds. The proposal has been subject to widespread criticism in the UK - primarily among hedge funds and private equity groups - amid concerns that the new rules would hurt the competitiveness of the City of London. In its answer to the FOI request, the Government said that "because of the very foreshortened timescale on which the directive is being negotiated, we will not be publishing a formal impact assessment." (Ref 9/411).

Meanwhile, the Guardian notes that Sweden - whose government is currently holding the rotating chair of the EU - is leading an effort to redraft the current proposal to "solve some of the problems" that have been raised by the industry. The revision of the proposal is currently being carried out by COREPER, a body which operates under EU ministers, consisting of experts from all member states. The European Parliament - who has as much power as national ministers over the proposal - is expected to begin its own revision of the proposal in late August.

Comment: This proposal is being rushed through against all Government guidelines and principles on how new laws should be drafted and agreed. The UK Government has made Impact Assessments (IAs) a key feature of its 'regulatory reform agenda', precisely to avoid this kind of scenario. Agreeing to the proposal without fully assessing its potential impact is both foolish and sets a worrying precedent, especially given the widespread concern that the regulation will hurt EU and UK economies.

According to the Government's guidelines, IAs should ensure that regulations are necessary and proportionate while not introducing unnecessary costs. "Any proposal" the guidelines state, "that imposes or reduces costs on businesses or the third sector requires an Impact Assessment...an Impact Assessment needs to be completed for all forms of intervention". Furthermore, they state: "In the earliest stages of policy development, it is particularly important that policy-makers should use Impact Assessment to help them understand and define the policy challenge and to analyse the case for Government intervention." Regarding EU proposals, the guidelines say that "Impact Assessments should be prepared in order to inform the UK negotiating position and collective agreement on it". UK officials are instructed to "make use of the UK impact assessment when lobbying other Member States to win support for the UK position."
FT Independent: Prosser IHT Telegraph Guardian Deal Book Blog IHT City AM OE research: Out of Control

Doctors' groups call on the Government to suspend EU working time rules
The Mail reports that doctors' pressure group RemedyUK has called on the Government to suspend provisions contained in the EU's Working Time Directive (EWTD), limiting junior hospital doctors to 48 hours' work a week, before they come into force on Saturday. The group, which has 8,000 members, is calling for special measures to bypass the imminent cut in maximum hours from 56 to 48 hours because they claim rising swine flu cases and numbers of NHS staff on sick leave will leave the Health Service struggling to cope.
According to PA, Matt Jameson Evans, Chair of RemedyUK, said: "We already know most doctors are against EWTD, we just need the leadership to do the right thing here." Writing in the Telegraph, President of the Royal College of Surgeons John Black argues "In order to comply with the new legislation, the NHS has had to reorganise to a level of cover that leaves no room for manoeuvre, and this is before the possibility of a swine flu pandemic comes along." He adds, "A longer term problem is that junior doctors are telling us they cannot get enough experience in the operating theatre and clinics. This is a real worry for the next generation of surgeons."
Mail Telegraph: Black OE research: Time's Up

New EP Internal Market Chair calls for better scrutiny of EU impact assessments
In an interview with EurActiv, Conservative MEP Malcolm Harbour, the new Chair of the European Parliament's Internal Market Committee, said he has been "convinced...how important it is for the [European] parliamentary committees to really take a proper look at the Commission's impact assessment of any proposal that comes before them, because this dossier is a very good example. If the strategy is not right and you are not happy with the strategy, then no amount of amendments to the Commission's proposal will make the strategy right. There is no point in tinkering around with the detail unless the core proposal is focused properly." He also indicated that he would want the rapporteurs for proposals "when we have a first exchange of views on a proposal...to say whether, in his or her view, the proposal is strategically sound, and the impact assessment has been properly done. That would save a lot of time later on and we would get a better quality of scrutiny to do that."

He also added that he did not agree with ALDE group leader Guy Verhofstadt's proposal for a single European financial supervision authority, adding that he "did not see the evidence" for the argument that the single market for financial services would disintegrate without one.
EurActiv Open Europe research

Michel Barnier: a bad choice for Internal Market Commissioner?
In an opinion piece in Le Monde, Pierre Briançon argues that "europhile" former French Agricultural and Fisheries Minister Michel Barnier is a bad choice for EU Internal Market Commissioner, despite the French government lobbying hard to secure this position for him. The article notes "without a doubt the post is currently the most important at the heart of the European executive, after the presidency", noting that the Commissioner will be responsible for financial markets and their regulation.

The article emphasises the City of London's opposition to a French politician becoming Internal Market Commissioner, which for them would be comparable "to entrusting the surveillance of a chicken coop to a fox". However the article argues that "the issue of new financial regulation is too serious to become a simple stake in negotiations on the composition of the future commission".

The article concludes that neither France, nor Germany or the UK should be given the Internal Market Commissioner portfolio and that the "European Union has 24 other members" so it should be possible to find a "firm and competent commissioner among them" to manage this "delicate portfolio".
Le Monde

EU moves to diffuse Balkan tension over "shortened" EU accession process for Iceland
EU foreign ministers yesterday unanimously referred Iceland's EU accession bid to the European Commission for a formal opinion. The Irish Times reports that EU leaders have moved to address fears among candidate countries in the Balkans that their own bids to join the EU would be delayed. EU Enlargement Commissioner Olli Rehn said, "Iceland's application will be treated by the book, there will be no short-cuts".

AFP quotes Swedish Foreign Minister Carl Bildt saying, "There will be no accelerated procedure for Iceland, but of course the road is shorter for Iceland than for other countries." RFI quotes French Foreign Minister Bernard Kouchner reminding of the necessity of "respecting the order of those who have attempted to join the EU." However, in an interview with Austrian newspaper Die Presse, Austrian Foreign Minister Spindelegger called for Iceland and Croatia to join the EU together.

El Pais notes that the Spanish fishing fleet sees Icelandic waters as "treasure" and that Spanish EU Affairs Minister Diego Lopez Garrido has said Spain will "have a lot to say" to avoid "in any case" its fishing interests being damaged during negotiations on Iceland's accession to the EU.
El Pais RFI L'express AFP FAZ BBC Irish Times EUobserver European Voice IHT El Mundo Die Presse AustrianTimes

WSJ: Britain and Germany are right to resist Sarkozy's desire for 'green' tariffs
An editorial in the WSJ warns that "one of the most dangerous but least reported undercurrents of the global-warming movement is trade protectionism." It notes that French President Nicolas Sarkozy - "a mercantalist in the best of times" - escalated the threat last month by suggesting EU import duties to "level the playing field" with countries that oppose binding greenhouse-gas targets at December's United Nations climate talks in Copenhagen.

The paper welcomes comments from Climate Change Secretary Ed Miliband, who said the Government was "sceptical" about Sarkozy's proposal, and Germany's Deputy Environment Minister Matthias Machnig, who described such a strategy as "eco-imperialism".
WSJ: Editorial FT Open Europe research

Synon on EU propaganda: "millions are taken from taxpayers, and all of it with a single aim: one people, one state."
Mary Ellen Synon criticises EU propaganda on her Mail blog, noting that the EU Directorate General (DG) for Communication has a budget of €213 million this year, but that all of the EU Directorate Generals have money earmarked for propaganda purposes in their budgets. Among the propaganda effort is a campaign to promote the "alleged excellence" of the Euro currency. Another propaganda effort is a report explaining how the EU strives to monitor its budget, it fails however to mention that the EU's own Court of Auditors has for years refused to sign off on the accounts. She further notes that the EU will spend €885 million from 2007-2013 on promoting a 'common European identity' among young people.

An editorial in Swedish daily Helsingborgs Dagblad notes that the EU's propaganda machinery has not been sufficiently criticised or scrutinised. It argues that it acts in a way that would never have been tolerated if it had been a national government in any of the member states.

EU Communication Commissioner Margot Wallstrom today responds to the critique about EU propaganda in an opinion in Swedish Daily DN. She argues that the EU is merely attempting to provide the public with information rather than promoting the EU itself through propaganda. She stresses that "the goal is not the get everyone to love the EU." She continues: "It is my philosophy that we [the EU] will create better policies if we first consult the public".
Mail: Synon blog Helsingborgs Dagblad DN Timbro's report OE research: The Hard Sell

EU-US data sharing agreement challenged by German politicians
Euractiv reports that European Commission plans to grant US officials access to European bank data in order to crack down on terror networks is triggering angry reactions in Germany. EU foreign ministers yesterday gave a mandate to the Swedish EU Presidency to negotiate a temporary agreement with the US regarding access to data held by SWIFT, a company located in Belgium which manages transactions between banks. The data that SWIFT can disclose to law enforcers includes bank account numbers, addresses and names of senders and recipients of financial transactions, as well as the amount transferred.

The article notes that the German Greens and MEPs from the SPD and the CSU have asked the German government to scrap the preliminary agreement with the US and reject the negotiating mandate.

Green MEP Daniel Cohn-Bendit has demanded that Commission President Jose Manuel Barroso involve MEPs in the decision on sharing sensitive bank information of European clients with the US. In the German newspaper Berliner Zeitung, he threatens that if Barroso does not do so "there will be a massive parliament coup. Barroso plays with fire".
Spiegel Irish Times EurActiv FAZ

The Irish Independent reports that the new pro-Lisbon Treaty "We Belong" organisation in Ireland are to avoid using the word "Yes" in their campaign, in an effort to distance themselves from the "losing side" of last year's referendum. The group has enlisted World Cup football hero Packie Bonner, Eurovision winner Eimear Quinn, and Dublin football team manager Pat Gilroy, to help in the "We belong" campaign.
No link

The Economist's Charlemagne looks at a new publication from the EU's foreign policy think-tank, the European Union Institute for Security Studies, entitled "What ambitions for European defence in 2020?" He notes that one contribution says the EU should be preparing "a capability to support hard power politics, both for Clausewitzian influence and possible direct military confrontation."
Economist: Charlemagne's notebook EUISS: "What ambitions for European defence in 2020"

The Common Agricultural Policy blog reports that France and Germany are seeking to revive the Franco-German alliance over CAP reform in order "to agree a mutual deal which they can then impose on others". It suggests that they may be able to "exploit the existence of a lame duck administration in Britain, the main champion of liberal solutions".
CAP blog OE blog

Le Monde reports that the EU is urging Turkey to tackle illegal immigration. Greece in particular is putting pressure on Turkey to meet its obligations regarding immigration. Greek Foreign Minster, Dora Bakoyannis said, "Turkey must meet its obligations and understand that it must cooperate on illegal immigration".
Le Monde

Writing in the WSJ, Jason Riley of City Law School and City University argues that, because the core procedural rules of European Union competition regulation date back to 1962, EU antitrust rules may violate the European Convention on Human Rights.
WSJ: Riley

After weeks of haggling, the IMF and the EU yesterday endorsed a Latvian deficit plan and said they would make available $2bn in loans.
WSJ

The European Union executive said on Monday it had paid a €1.5 billion installment of a loan to Romania and €1.2 billion to Latvia to help the two countries deal with the economic crisis. This is the first tranche of a total of 5 billion euro loan to both countries.
Financial Times Deutschland

Le Parisien reports that the EU has decided to extend its Georgia mission for another year. This mission was set up in October 2008, after the Russia-Georgia conflict.
El Mundo Le Parisien AFP FR.RIAN

El Pais reports that the EU has definitively approved a regulation for more control and supervision of rating agencies, which have been accused of contributing to the financial crisis by not giving adequate warnings of mortgage problems in the US.
El Pais

The new Bulgarian Prime Minister, Boiko Borisov has vowed to fight against the corruption which has been tarnishing Bulgaria's image, answering the demands of the European Commission.
ABC

The BBC reports on the EU ban on the sale of all seal products. The ban, which exempts products from traditional hunts by indigenous peoples in Canada and Greenland, has provoked reactions from Canada which says that it will challenge the decision at the World Trade Organisation.
El Mundo El Pais IHT HS BBC EUobserver EurActiv FAZ IFAW

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: openeurope.org.uk or call us on 0207 197 2333.