The year began with a bang in Brussels and it wasn’t just the Brussels' Atomium fireworks, the United Kingdom finally began 'getting Brexit done’ and the European Commission (EC) published its delayed Work Programme for 2020. These two events are not as unrelated as they seem. With the UK leaving, the European Union has lost one of its most liberal Member States. This at a time when Germany has entered a period of political uncertainty and France is vocally calling for a more assertive, potentially protectionist, Europe.
Into this void, Commission President Ursula von der Leyen has put forward an ambitious and expansive Work Programme laying out the legislative priorities of the new administration for 2020. This Programme contains 43 new initiatives despite von der Leyen's previous commitment to a "one in one out approach" to legislation, a principle stating that each legislative proposal creating new burdens should relieve people and business of an equivalent existing burden in the same policy area.
The announcement of 43 Initiatives by the new Commission is a clear break with Jean-Claude Junker’s, which only announced 23 new initiatives in its first Work Programme. Despite its pledge to cut red tape, this Commission’s first Work Programme seems more closely aligned with bureaucratic pre-crisis administrations led by Barroso and Prodi. This suggests we will see an increased willingness by the Commission to propose comprehensive regulatory action on key topics such as climate change, environment and digital policy. Considering how internationally salient these topics are, these initiatives have the prospective to have a significant impact not only within the EU, but also for all global trading partners.
Key Initiatives to Watch in 2020
Commission President von der Leyen put tackling the climate crisis at the centre of her ambitions for the Commission in her first ever speech to the European Parliament in July 2019, and the Work Programme reinforces this by making it clear that climate policy will be the thread that runs through all of her Commission's initiatives.
"I want Europe to become the first climate-neutral continent in the world by 2050." - Ursula von der Leyen, President of the European Commission, speech in front of the European Parliament, 16 July 2019
The Commission will aim to embed climate measures into all legislative fields. The highlight of the Programme is the intention to establish a binding climate neutrality target for 2050. This would translate into law the commitment taken at international level with the Paris Agreement.
The Commission's intention with this initiative is clear: the EU means business when talking about climate change and wants to be the international leader in the field.
However, with the majority of Member States still dependent on fossil fuels and the renewable energy transition very much a "work in progress," the Commission's ambition will soon face the reality of the stagnating EU economy and politically divergent Member States. This was illustrated by a recent public consultation on the expected EU climate law, where many stakeholders put a strong emphasis on the need for a stable and predictable landscape for investment.
Another key initiative announced in the Work Programme is the ambition for an expanded Circular Economy, an economy where we keep products and materials in use for as long as possible. Due in March, the Second Circular Economy Action Plan has been expected for some time, even before a draft of the text was leaked to the press in January. This document would set the EU's legislative priorities on how to achieve a "circular economy." By 2030, only safer, circular, and sustainable products should be placed on the EU market," the leaked document said. In order to achieve this objective, the Commission will work on "upstream measures" such as "minimum requirements that prevent unsustainable products from being allowed on EU markets."
"To absolutely decouple growth from resource use, we must change the way we produce, market, consume and trade and the way we deal with waste." - Leaked Commission’s Circular Economy Action plan, 31 January 2020
The expected Action Plan is another indication that this Commission is not afraid of imposing regulatory action more than its predecessor when it comes to sustainability. The leaked draft foresees some 40 new regulatory initiatives to be implemented during this Commission's mandate. However, in spite of the Commission’s ambition, the new circular economy action plan can only bring about limited progress as the kind of transformation the Commission envisions would require a level of technological development which is not uniformly widespread across Europe.
What the EU desperately needs is a serious jump forward in research, innovation, and development that spreads evenly across EU’s Member States.
DIGITAL SERVICE ACT
"Some of these platforms, they have the role both as player and referee, and how can that be fair?"... "You would never accept a football match where the one team was also being the referee." - Margrethe Vestager Executive Vice President of the European Commission for a Europe Fit for the Digital Age, The New York Times, 19 November 2019
The need to update and expand the regulations around digital service rules has been evident for the better part of a decade as new technologies have rapidly emerged. The European Union and its Member States have taken aggressive steps towards breaking the American corporate monopolization of the digital economy. Indeed, EU assertiveness is not new in this sector; as shown by regular antitrust probes and new data protection rules.
What is new is the fact that this time the EU's political priorities coincide with the well overdue review of existing rules on the liability of online platforms. Adopted 20 years ago, the E-Commerce Directive sets up liability exemptions for hosting companies for content that users share on their networks. These 'safe harbour' provisions were meant to protect the fundamental rights of users, in particular the freedom of expression and information. After 20 years, the landscape of services that fall under these liability exemptions has dramatically changed. Cloud services and social media platforms have grown significantly in power and market share.
Under Article 14 of the E-Commerce Directive, a company such as Facebook is not liable for information posted by its users if it has no knowledge of the fact, or if the platform quickly reacts to remove it. A revision of liability rules of online platforms would inevitably have a massive impact on both European and International digital services, perhaps even more so than the infamous General Data Protection Regulation (GDPR).
It is clear that the Commission under von der Leyen is preparing the ground for a more ambitious, legislatively active EU.
While there are certainly advocates for this proactive Commission, it is also clear that many of these proposals will cause friction, both internally amongst Member States, and externally with trading partners. Indeed, many of these ideas will clearly have significant global repercussions. In particular, if the Climate Law is enacted, there will be serious knock-on effects throughout the European Union as new emissions targets would have to lead to substantial regulatory changes across all sectors of the European economy. Corporations and SMEs around the world will have to comply with the new rules if they want to access the European Union’s internal market.
The FiscalNote Brussels office will be following all these initiatives (and many more) as they develop. Stay tuned.
Tom Adlam has worked in the research and consulting space for several years, building on his experience in the private sector in the UK with policy focused work for FiscalNote, leading the build out of the Professional Services Team in Europe following FN's 2017 acquisition of EU Issue Tracker.
Danilo Gattullo is Senior Analyst at FiscalNote’s Professional Service division. He has several years of experience tracking EU policy developments as Environmental analyst for EU Issue Tracker. Before joining FiscalNote, he worked in EU public affairs in Brussels in both a consultancy and trade associations.