ROADMAP : ESTABLISHMENT OF A MANDATORY TRANSPARENCY REGISTER FOR INTEREST REPRESENTATIVES

Context and Problem Definition

Citizens expect the EU decision-making process to be as transparent and open as possible. The EU institutions interact with a wide range of groups and organisations representing special interests. This is a legitimate and necessary part of the decision-making process to make sure that the EU policies reflect citizens’ real needs. The decision-making process must be transparent to allow for proper scrutiny and to ensure that the Union’s institutions are accountable. The European Parliament and the European Commission are committed to being open about the groups and organisations with which they interact.

The Transparency Register provides information on who is trying to influence the EU decision-making process, which interests are being pursued and with what budgets. Today the Register includes 8 163 registrants (on 28/07/2015), all signed up to its Code of Conduct.

The Commission established the first Register of Interest Representatives in 2008. In 2011 when the European Parliament joined the initiative this was renamed Transparency Register and the first Interinstitutional Agreement (IIA) was signed between the two institutions serving as a framework to run the scheme. A new version of the Transparency Register was launched on 27 January 2015. This ‘second generation’ Register implements the provisions of the revised Interinstitutional Agreement (IIA) signed between the European Parliament and the European Commission in April 2014 and in force since 1 January 2015.

In his Political Guidelines for the next Commission under priority 10) ‘A Union of Democratic Change’, President Juncker committed to enhance transparency when it comes to contact with interest representatives. The President’s transparency initiative of November 2014 and the related pre-requisite to meet only registered entities represent a further step towards a mandatory register. The Commission Work Programme 2015 foresees to go further by proposing a mandatory Transparency Register based on an Interinstitutional Agreement covering the European Parliament, the European Commission and Council.

The transition to a mandatory Register would represent a continuation and an upgrade of the current system, widening its scope of application to the Council and introducing additional administrative measures to make registration of interest representatives a pre-requisite to carry out activities which seek to directly or indirectly influence policy making.

The main problems with the current voluntary approach are perceived as the following:

• Despite a number of incentives offered by the EU institutions some relevant (and important) stakeholders have not joined the Register;
• Currently only the European Parliament and the European Commission manage the Register and Council participates only as observer;
• Sub-optimal overall data quality;
• Insufficient level of precision and legal certainty hampering an appropriate implementation of the system.

 Who will be affected by it ?

 All stakeholders potentially engaged in activities carried out with the objective of directly or indirectly influencing the formulation or implementation of policy and the decision-making processes of the EU institutions.

 Lobbying is best regulated at the level at which it takes place and by the respective ‘lobbied’ party i.e. the public authority that is the subject of lobbying. According to the principle of subsidiarity, Member States should themselves regulate lobbying conducted vis-à-vis national public authorities. This principle is enshrined in the IIA which states that the Register does not apply to Member States’ government services and does not include activities directed at their Permanent Representations to the EU. If Member States were to regulate lobbying conducted vis-à-vis the EU institutions the risk is lack of common standards and uneven playing field. Such an approach would also not be cost-effective, neither for the Member States, nor for the stakeholders that would have to comply with different rules when carrying out their activities across different national jurisdictions.

Objectives of the Initiative

• Better coverage of interest representatives lobbying the EU institutions
• Level playing field as all relevant stakeholders will have to register
• Greater transparency of the interest representation at the EU level
• Increase transparency and foster trust in the EU-decision making process on the part of citizens and stakeholders.

Options

At the EU level, there are basically two options to establish a mandatory Transparency Register- a sanctions-based regime and a ‘privileged access’ regime.

Option 1. A Sanctions-based regime based on legislation, i.e. a Regulation or Directive. A legislative act on the basis of Article 352 TFEU (which requires unanimity in Council and the consent of the EP) is one option as it is binding in its entirety and directly applicable. It is the only available legal basis to establish direct requirements for lobbyists. Under this system failure to declare lobbying activities or providing wrong/misleading information could lead to administrative sanctions. Pursuing Option 1 is likely to have negative impacts on simplification, administrative burden and implementation arrangements for Member States and could lead to difficulties of transposition for some of them.

Option 2. A Privileged Access regime based on an Interinstitutional Agreement. Representation under this system is a pre-condition in order to gain access to decision-makers, premises, committees and other similar structures, or to information, etc. The IIA can include a series of administrative measures established unilaterally by each institution. Option 2 seems more feasible than either variant of Option 1. In principle, the EU legislator could empower the institutions to impose administrative sanctions, including financial sanctions, in order to uphold the correct operation of the Register. However, this could be considered to be disproportionate and would in any event require lengthy discussions. Even if Member States were to be given the enforcement task, this would require further implementation legislation (Directive scenario) which would equally be a lengthy and disproportionate process at odds with the principles of Better Regulation of reducing administrative burden. In any event, unanimity in the Council would be needed for any of these approaches.

Main Costs and Benefits under a ‘Privilege Access’ Regime.

Costs

• IT budget for development and maintenance to align to and to run the new mandatory scheme;
• More staff available for the Joint Transparency Register Secretariat to ensure smooth transition to and management of the mandatory regime.

Benefits

• Increase coverage of the ‘Public Affairs’ sector when a meaningful ‘conditionality’ is put in place (e.g. no meeting with Commissioner or no permanent access badge to the European Parliament for non-registered entities);
• Common set of rules defined in the IIA and implemented coherently by the three main EU legislators. The implementation modalities can be introduced relatively swiftly through the institutions’ Rules of Procedure/working methods or other similar administrative measures;
• Improved quality of data as monitoring is strengthened;
• Faster tripartite interinstitutional process with more realistic outcome compared to negotiations and unanimity requirement in Council.

 Time Line

• The European Commission will put forward a proposal to the Council by 2016, asking Member States to unanimously endorse a Mandatory Register, based on article 352 of the EU treaty. If they agree; the register could become mandatory by 2017. If not, a full review is scheduled in 2017.

Problem of Legal Basis

The EU may enact laws imposing duties on citizens and businesses only if it has an explicit competence to do so. Article 298(2) TFEU allows the Parliament and Council to establish, using the ordinary legislative procedure, provisions ensuring that the EU institutions carry out their missions with the support of an open and independent European administration. However, this would allow the EU to regulate the issue of transparency only with respect to EU officials, not with regard to lobbyists.

Therefore, the only legal basis which could be used is the flexibility clause of Article 352 TFEU. It provides that if EU action is necessary in order to attain one of its objectives, and there is no specific legal basis in the Treaties, the appropriate measures may be adopted using a special legislative procedure (unanimity in Council, EP consent). The objective of the EU to be pursued would be that of transparency (Articles 1 and 15 TFEU, 10 and 11 TEU). It remains to be seen what a mandatory system would look like based on an IIA, as suggested by Commission President Juncker, as opposed to a mandatory system based on a regulation.