European Parliamentary Research Service Blog

Written by Bruno Bilquin.

Almost two years since Russia began its full-scale invasion of Ukraine, EU military assistance under the European Peace Facility (EPF) is lagging. The special European Council meeting of 1 February 2024 invited the Council to agree by early March 2024 to amend the regulation establishing the EPF, in order to increase its financial ceiling.

Is the European Peace Facility entering a new phase?

In October 2023 and again in December, the High Representative/Vice-President of the Commission (HR/VP) Josep Borrell proposed to the Foreign Affairs Council an envelope under the EPF of €5 billion a year for the years 2024 to 2027 for military assistance to Ukraine. At the Foreign Affairs Council meeting of 22 January 2024, this evolved into a proposal for a single, non-repeatable €5 billion EPF top-up in order to establish a ‘Ukraine Assistance Fund‘ within the EPF, to encourage EU Member States to increase their military support for Ukraine. This support remains badly needed, as Ukraine is still suffering from ‘shell hunger’, despite EU efforts and those of the international artillery coalition led by France and the United States (US). EU military aid to Ukraine is all the more necessary given the potential outcome of the next US presidential elections and the current congressional funding crisis.

Between February 2022 and 1 February 2024, the US delivered US$44.2 billion in military assistance to Ukraine. On 4 February 2024, a bi-partisan deal in the Senate proposed a $118 billion draft package pairing strengthened security on the US–Mexico border with wartime aid for Israel and other US partners, with a $60 billion envelope for Ukraine. Top Republicans in the House immediately rejected the draft; it is still under discussion since the Senate on 11 February again supported it, through a procedural vote, and on 14 February, approved it.

During their 31 January 2024 informal meeting, EU defence ministers had discussed the way ahead for EU military support to Ukraine. In his press remarks upon arrival at that meeting, the HR/VP said:

It is obviously necessary to have a clear understanding of where we are with [the provision of] ammunition. Ministers have been asked to present exactly what they have done, what they are doing, what they plan to do, in order to have a clear understanding of what has to go all together to provide Ukraine with what it needs […]. Ukraine needs more ammunition. There is a big imbalance between the fire capacity from one side and the other, and this gap has to be filled.

Indeed, according to experts, the EU is not on track to hit the one million rounds of ammunition target decided by the Council on 20 March 2023 under a three-track approach: deliveries, joint procurement and ramping-up of ammunition production. ‘We … will try to solve the issues that some Member States want to be considered in the new stage of the EPF’, the HR/VP added, mentioning the need for the EPF to shift from funding the destocking of the previous existing material to supporting the production of the European defence industry. In his press remarks following the January 2024 informal meeting, the HR/VP said that he had reiterated the urgent need to agree on further military support for the short and long term, and that the Member States and the EU had shared the following aggregated data.

• Since the start of Russia’s full-scale invasion of Ukraine (24 February 2022), the EU and its Member States have provided and placed €28 billion worth of military equipment.
• Many Member States provided their budgeted commitments for bilateral military assistance to Ukraine, amounting to at least €21 billion for 2024. Member States have submitted partial reimbursement requests (reportedly based on a reimbursement rate of between 25 % and 45 %) from the EPF funds for their military deliveries to Ukraine.
• The target of 40 000 Ukrainian soldiers trained through the EU military assistance mission for Ukraine (EUMAM Ukraine) had almost been reached on 1 February 2024; Member States agreed to add 20 000 soldiers, which would raise the number of trained soldiers to 60 000 by the end of summer 2024. The EPF operations pillar funds the common costs of EUMAM, while the EPF assistance pillar finances the assistance measures for the Ukrainian army.
• From March 2023 to 1 February 2024, 330 000 ammunition rounds have been delivered, mainly from existing stocks, representing only one third of the objective of one million ammunitions a year agreed by the Council on 20 March 2023. The HR/VP said he expected an additional 200 000 ammunition rounds by March 2024 from destocking and individual and joint procurement, thus reaching 52 % of the set objective (or slightly more, as not all Member States have sent their data). Deliveries of artillery ammunitions and missiles before 31 May 2023 – the first track of the ammunition plan for Ukraine – or orders placed for these items before 30 September 2023 through joint procurements – the second track of the ammunition plan – may be partially reimbursed from the EPF to the Member States.
• The HR/VP expects further deliveries of 600 000 ammunition rounds from orders Member States are placing, so as to reach the initial objective of one million rounds of ammunition deliveries by the end of 2024. According to the HR/VP, the industry’s production capacity will continue to increase as orders are placed; production capacity has already increased by 40 % since February 2022 and will again increase by 40 % in 2024, from a production capacity of 1 million rounds a year on 1 February 2024, to 1.4 million by the end of the year.

The €5 billion Ukraine Assistance Fund within the EPF: A work in progress

Initially, the 2021-2027 multiannual financial framework (MFF) was the only point on the draft agenda of the special European Council meeting of 1 February 2024. EU leaders discussed the mid-term review of the 2021-2027 MFF, including support for Ukraine. This support consists mainly of the Ukraine Facility, a €50 billion fund, split between €17 billion in grants and €33 billion in loans, for 2024 to 2027, to help Ukraine’s recovery, reconstruction and modernisation towards EU accession. The European Council came to an agreement on the Ukraine Facility.

In his press remarks before the meeting, the HR/VP said he would urge EU leaders to increase military support for Ukraine, through the Ukraine Assistance Fund within the EPF. He also confirmed that ‘some Member States, Hungary for example’, had expressed their wish to no longer participate in the EPF, albeit without obstructing it. The leaders did not, however, reach an agreement on the Ukraine Assistance Fund. The European Council reviewed the Council’s work on military support for Ukraine under the EPF and the proposed rise in the facility’s overall financial ceiling and invited the Council to reach an agreement by early March 2024 to amend Council Decision (CFSP) 2021/509. The EPF ceiling, set at €12 billion in current prices, would receive a one-off top-up of €5 billion, based on the 22 January 2024 HR/VP proposal, which no longer includes a €5 billion ‘annual’ top-up for the four coming years, marking a drastic down-sizing of the HR/VP’s initial ambition. Decision 2021/509 establishing the EPF has already been amended twice for the first and second tracks of the ammunition plan.

The European Council also invited the Council to take into account ‘suggestions by the Member States’. This refers, inter alia, to Germany’s request for a detailed list of commitments from other Member States for military deliveries in 2024 and to reduce its own real contribution to the EPF comparatively. On 8 January 2024, German Chancellor Olaf Scholz had pointed out that Germany was, after the US, the world’s second-biggest provider of military aid to Ukraine, committed to deliver weapons and military material worth over €7 billion in 2024 alone. He had called on the other EU Member States to step up their support for Ukraine, asking them to present, by 1 February (the day of the special European Council meeting), a detailed summary of their military deliveries to Ukraine.

Lastly, the European Council reiterated ‘the urgent need to accelerate the delivery of ammunition and missiles, notably in view of the commitment to provide Ukraine with one million rounds of artillery ammunition’ and called on Member States ‘to explore all options to meet Ukraine’s needs …, including continued stock donations, redirection of existing orders and the placing of the necessary new orders, which will contribute to increasing European industry’s production capacity’.

On 27 February, Members of the European Parliament are expected to vote on a report urging Member States to approve the HR/VP’s initial proposal for a €20 billion Ukraine assistance fund within the EPF, and to accelerate ammunition deliveries from their stocks to Ukraine through the EPF.

Read this ‘at a glance’ note on ‘European Peace Facility: Continued EU military assistance to Ukraine‘ in the Think Tank pages of the European Parliament.

Written by Eszter Fay.

The development of new products and services from the convergence of digital and space technologies provides us with a space economy, or ‘space-as-a-service’.

However, the sustainability of space-based infrastructure in orbit and beyond is an emerging policy issue that is likely to become increasingly important in the coming decades. Accumulation of space debris could hinder our future exploration and exploitation of space. And in the near future, the observation of the universe from Earth could become impossible.

The space industry – mainly satellite manufacturing, support ground equipment manufacturing, and the launch industry – is growing fast. This creates environmental sustainability challenges such as the impact of re-entries, or light pollution that hinders astronomical observation, and environmental impacts on Earth itself.

How can we shape outer space economic development to save this planet? How can Europe establish, manage and protect its infrastructure in space, so humanity benefits from outer-space activity? Can Europe maintain a lead on clean space policy and technology? And can civil society help address space challenges to maximise public understanding and support for an ambitious European space strategy?

During the workshop on the ‘Future of Space – the sustainable path‘, organised by the European Parliament’s STOA Panel for Future of Science and Technology, experts from several disciplines discussed these questions with policymakers.

EU Space Law

According to STOA Vice-Chair Ivo Hristov (S&D, Bulgaria), this debate was very timely, as the European Commission was holding a public consultation on a draft law on space, planned for adoption in early 2024. The new EU Space Law will be structured around three main pillars:

1. Guaranteed safe satellite traffic, aimed at mitigating the risk of collision caused by space debris;
2. Resilient EU space infrastructure, in particular against cyberattacks;
3. Sustainable space operations to ensure our ability to use space as an important economic engine.

Space pollution

Space pollution is self-sustained. More than 8 000 space craft currently create debris by colliding with space debris orbiting the Earth. Today, 128 million objects larger than 1 mm (and of those, 34 000 are bigger than 10 cm and 900 000  bigger than 1 cm) are currently spinning through space at 7 km/sec.

Because space debris increases the light in the sky, it hampers astronomical observation and damages radio frequency, both of which need a dark and quiet sky. A 2023 United Nations report identified space debris as one of our planet’s tipping points, which could impact our lives significantly (next to a Gulf stream collapse or melting polar ice, for instance).

The European Space Agency (ESA) carries out important space debris mitigation activities, including the ‘Zero Debris Charter‘ to drive guarantees to remove satellites from orbit at the end of their life. A vehicle capable of capturing space debris is being developed in the framework of the world’s first mission to remove debris from Earth’s orbit.

Moving to sustainable space activities

Experts present at the workshop from ESA, the European Commission and the European space community put forward elements that could enable more sustainable and fair space activities.

• More research programmes are needed on space sustainability – for example, to assess the impact on the upper atmosphere of burning metals during satellite re-entries.
• Political action and better regulation of commercial satellite launches are needed to enhance space sustainability. This regulation should be incorporated into EU environmental policy.
• Companies need legal certainty and legislation allowing open competition on a level playing field. International regulation of frequencies and orbits should make the market more accessible.
• A positive narrative on space exploration could be developed, including on international scientific cooperation, solidarity and inclusive reflection, to attract younger generations to engage in space science.
• Space development demands a multi-disciplinary and multi-cultural approach: It is not ‘only’ technological innovation. This should have an impact on research and innovation policies. The race for commercial development in space cannot be pursued without an ethical reflection, in terms of justice and sustainability. Space is a common good. An impactful European position would require investment in innovation and support for start-ups and companies who can play a role in the space economy.
• The systematic use of space sustainability rating tools could help encourage space actors to design and implement more sustainable and more responsible space missions for the long-term sustainability of the space environment.

For more details, you can watch the event recording here and an EPRS video here.

Your opinion matters to us. To let us know what you think, get in touch via stoa@europarl.europa.eu and follow us on X at @EP_ScienceTech.

Written by Vasco Guedes Ferreira.

In an important election year for the European Parliament, the Panel for the Future of Science and Technology (STOA) demonstrated its commitment to embracing and disseminating the most recent social science on democratic participation with the 21st STOA Annual Lecture under the theme ‘Making Democracy Work for Everyone’.

Christian Ehler (EPP, Germany), Chair of STOA opened the meeting, with keynote speaker, Professor Michael Bruter, an expert in political science and European Research Council grantee, giving a compelling address on the importance of social sciences in addressing societal challenges and in supporting policymakers in taking informed and fact-based decisions.

Professor Bruter shared his insights into the challenges and solutions for democratic inclusion across generations, personal situations, and global contexts. His lecture acknowledged the intricate tapestry of democratic processes, highlighting the paramount importance of inclusivity. He addressed the generational gaps, socio-economic disparities, and diverse global contexts that can hinder equal representation and participation. Professor Bruter argued that democracy (i.e. democratic institutions) needs to adapt and be more responsive to citizens’ needs.

Making democracy work for everyone

A panel discussion featuring Sylvia Kritzinger (Professor at the Department of Government of Vienna University), Barbara Prainsack (Chair of European Group on Ethics in Science and Technology), Yves Dejaeghere (Executive Director of Federation for Innovation in Democracy – Europe), and moderated by Sandra Parthie (Member of the European Economic and Social Committee), further explored the dynamics of democracy and sought solutions for a future where the democratic process is not just a mechanism but a living, thriving entity, serving everyone.

The concept of ‘loser consent’ was brought to the forefront of the discussion, with an emphasis on the potential backlash when losers refuse to accept electoral outcomes. Sylvia Kritzinger also explored the meaning of voting, and drew attention to the diverse interpretations people attach to this fundamental democratic act. Importantly, there was a great emphasis on the need to engage the younger generation, who brings a fresh perspective and enthusiasm, thus contributing to the vitality of our democratic discourse.

A recent opinion of the European Group on Ethics in Science and New Technologies, chaired by panellist Barbara Prainsack, explores several challenges to democracy, and in particular the role of private companies and social media in shaping public spaces and people’s opinions. During the discussion, recommendations on digital literacy and addressing the digital divide were underlined as essential components in strengthening our democratic values.

From his hands-on experience in supporting the creation of citizens’ assemblies across Europe, Yves Dejaeghere broadened the perspective on democracy. He highlighted the diminishing importance of intermediary forces (i.e. democratic institutions) and advocated for a more comprehensive view of democracy, citing examples of both the positive and negative aspects of citizens’ assemblies, and the importance of concrete decisions and outcomes that are taken forward by the political actors.

During the discussion with the audience, it became clear that democratic inclusion is a complex issue, and a shift in perspective is urgent. Democracies need to adapt to citizens rather than the other way around. This comes in light of citizens’ increasing demands from their democracies.

The keynote speaker and the panellists recognised citizens’ efforts to contribute positively to their democracies and stressed the need to create conditions that use this goodwill for community benefit.

The participants agreed that restoring hope to those who have become disillusioned is paramount, alongside a new focus on returning citizens to the heart of democratic thinking and practice, while creating a vision for a better future for the current and next generations.

A recording of the event is available on the STOA website.

Read the interview with Professor Michael Bruter.

Your opinion matters to us. To let us know what you think, get in touch via stoa@europarl.europa.eu and follow us on X at @EP_ScienceTech.

STOA Annual Lecture 2024 – Making democracy work for everyone© European Union 2024 – Source : EP© European Union 2024 – Source : EP© European Union 2024 – Source : EP© European Union 2024 – Source : EP© European Union 2024 – Source : EP© European Union 2024 – Source : EP

Written by Naja Bentzen with Kate Dwyer (European Parliament Liaison Office, Washington DC) and Eric Pichon.

Conflict, food insecurity and climate shocks, among other crises, have destabilised African countries in recent years and curbed economic activity. Nevertheless, sub-Saharan Africa is seen as an emerging geopolitical force; and the European Union (EU) and the United States (US) are actively reframing their partnerships with the region.

Background: Challenges in a geostrategic environment

Sub-Saharan Africa holds the key to addressing many of the world’s most critical challenges. The region has one of the world’s youngest and fastest-growing populations, encompasses one of the largest free trade areas, has natural resources essential for renewable and low-carbon technologies, and holds a quarter of the seats in the United Nations General Assembly. There are, however, obstacles hampering the region’s geopolitical influence. Democratic backsliding and security crises relating to violent extremism and military coups have intensified in several sub-Saharan African countries in recent years. Out of the region’s 49 countries, 22 are considered fragile or conflict-affected. Some 462 million sub-Saharan Africans were living in extreme poverty in 2023, and public health challenges persist. Alongside climate-related issues, economic shocks from the COVID-19 pandemic and Russia’s war on Ukraine have exacerbated food insecurity and the region’s debt.

Growing Russian and Chinese influence further challenge EU and US cooperation with sub-Saharan African countries. Since 2000, China has significantly expanded its trade, investment and financial ties with the region, as well as increasing its political and military engagement. Russia has similarly intensified its military, political and economic ties with the region in recent years, including through the Wagner Group.

The EU and the US share an interest in a prosperous, peaceful and democratic Africa. During the 2021 EU–US Summit, they voiced concern over the deteriorating political, humanitarian and security situations in several sub-Saharan African countries. In their 2023 joint summit statement, they reaffirmed their commitment to enhance cooperation with African partners and tackle common security challenges together with the Economic Community of West African States (ECOWAS). In a recent joint initiative, the EU and the US teamed up to advance the development of the Trans-African (Lobito) Corridor, a flagship project of the G7’s 2022 Partnership for Global Infrastructure and Investment (PGII).

European Union–Africa relations

For the past 23 years, EU relations with sub-Saharan Africa were underpinned by the Cotonou Agreement, a legally binding treaty between the EU and sub-Saharan African, Caribbean and Pacific (ACP) countries covering trade, development and political cooperation. On 1 January 2024, the provisional application of the Samoa Agreement replaced the Cotonou Agreement with a new structure for EU–ACP relations and more flexibility for levels of action and types of cooperation. This framework complements the Africa–EU partnership, established at the first Africa–EU Summit in 2000, and the Joint Africa–EU Strategy, adopted in 2007 to strengthen political partnership and enhance cooperation. Recognising the evolving geopolitical environment, in 2020, the European Commission and the High Representative published a joint communication, ‘Towards a comprehensive strategy with Africa’. They proposed centring a new EU–Africa strategy on five thematic partnerships: green transition and energy; digital transformation; sustainable growth and jobs; peace and governance; and migration and mobility. The strategy was discussed at the 2022 African Union (AU)–EU Summit. The concluding declaration, ‘A Joint Vision for 2030’, highlighted a reaffirmed commitment to multilateralism and renewed partnerships for both peace and security and migration and mobility. At the same time, the EU pledged €150 billion in investment for 2021-2027 through the Global Gateway programme, to support its common ambition with Africa for 2030 and the AU Agenda 2063. The EU further pledged to provide specific packages for health and education systems and mobilise €425 million through Team Europe to support vaccination efforts. During the 2022 AU–EU Commission-to-Commission meeting, Commissioners agreed to launch a €750 million programme for infrastructure investment in Africa. Commission President Ursula von der Leyen has made it clear that the EU is not deterred by the slow implementation of its Africa strategy, but intends to rethink its strategic presence to ensure it shows the same unity of purpose towards Africa as it does towards Ukraine. In building on its economic partnership agreements (EPA) with ACP partners, the EU launched a landmark EPA with Kenya in December 2023 to enhance trade, investment and development. The EU also supports the African Peace and Security Architecture (APSA) through its Peace Facility and common security and defence policy.

European Parliament role and responsibilities

Parliament is at the forefront of reshaping the EU’s Africa strategy. A 2017 resolution on boosting development in Africa included many of the priority areas subsequently set out in the 2020 joint communication. In a 2021 resolution on the EU–Africa strategy, Parliament urged both sides ‘to move beyond the donor-recipient relationship’, prioritise human development and human rights, and adapt their priorities in the light of COVID‑19. Throughout 2022 and 2023, Members of the European Parliament (MEPs) passed several resolutions on various aspects of EU–Africa relations, including security threats in western and Sahelian Africa. Parliament has been a strategic partner of the AU’s Pan-African Parliament (PAP) since its inauguration in 2004. In 2009, MEPs created a standing Delegation for the Pan-African Parliament (DPAP). In 2015, Parliament’s Democracy Support and Election Coordination Group (DEG) designated the PAP as a priority regional parliament. MEPs also regularly exchange with African parliamentarians through the ACP–EU Joint Parliamentary Assembly and, as of February 2024, the Africa–EU Parliamentary Assembly. In 2023, the European Parliament opened an office in Addis Ababa, Ethiopia, to liaise with the AU.

United States–Africa Relations

US–Africa policy has generally prioritised development, trade and investment, democracy and governance, and peace and security. Through State Department initiatives and the US Agency for International Development (USAID), the US has made vital contributions to curb public health crises, expand political rights and civil liberties, and spur economic growth. Under Obama, the US launched several programmes to increase engagement, including the Young African Leaders Initiative (YALI), the African Women’s Entrepreneurship Program and Power Africa. Despite strained relations between the US and sub-Saharan Africa, in 2019, the Trump administration launched Prosper Africa as a key vehicle for US trade and investment aid. In an attempt to reframe Africa’s importance to US national security interests, the Biden administration adopted a new US Strategy Toward Sub-Saharan Africa in 2022. With its core objectives – fostering open societies; democratic and security dividends; pandemic recovery and economic opportunity; and climate adaptation and a just energy transition – the strategy aims to address immediate crises and threats while working towards strengthening Africa’s capabilities to solve global problems. During the 2022 US–Africa Leaders Summit, the Biden administration pledged to invest US$55 billion to support its strategic objectives for 2023-2026, and supported greater African representation in international institutions. The 2022 strategy has increased high-level engagement by US officials, and led to the creation of the President’s Advisory Council on African Diaspora Engagement in the US.

US Congress role and responsibilities

The US Congress plays a crucial role in supporting American policy objectives in Africa. Each chamber has sub-committees on sub-Saharan Africa to address a range of pressing topics, including governance, human rights and development challenges. In 2000 and 2015, Congress enacted and reauthorised the African Growth and Opportunity Act (AGOA), a preferential trade agreement that has substantially improved African export competiveness and contributed to the creation of tens of thousands of jobs. Congress also created the Millennium Challenge Corporation (MCC) in 2004, one of the main US policy initiatives in Africa, to form partnerships with countries committed to democratic governance, economic freedom and investing in their populations. During the 115th and 117th Congress, key legislation on Africa included the Better Utilization of Investments Leading to Development Act, establishing the US Development Finance Corporation, and the Trans-Sahara Counterterrorism Partnership Program. In addition to authorising executive action and diplomatic engagement, Congress appropriates and oversees all US foreign assistance for Africa. The House Democracy Partnership (HDP) also maintains legislative strengthening partnerships with the legislatures of Liberia and Kenya. In 2023, the House launched a US–Africa Policy Working Group to enhance cooperation with the continent and increase its understanding of ongoing challenges.

Read this ‘at a glance’ note on ‘EU and US strategies towards sub-Saharan Africa‘ in the Think Tank pages of the European Parliament.

Written by David De Groot and Silvia Kotanidis.

In June 2024, around 400 million EU citizens go to the polls to elect the Members of the European Parliament’s 10th legislature. As the only EU institution that represents EU citizens, elections to the European Parliament are therefore major democratic events, and the only one at EU level that resembles national democratic electoral consultation. European elections, however, differ from the national version, as they are part of a context of multi-tier government, sometimes perceived as ‘second order elections’.

The main difference is that the European elections are a rather fragmented exercise, since a great part of the electoral process, including the way in which the right to vote is exercised, remains subject to national rules. In addition, the lack of a real transnational forum in which to debate European (as opposed to national) issues during European elections is one reason why European elections have failed to earn attention comparable to national elections, despite the prominent role the European Parliament has acquired in European policy-making in recent decades.

A number of reforms have been put forward over the years. Measures to harmonise rules or mechanisms that would personalise the elections and hence bring more visibility to the candidates and their campaigns have been proposed. Two reforms are pending. In one case, to harmonise a few aspects of the electoral process. In the other, to make additional deeper reforms with the introduction of a Union-wide constituency. A repeat of the lead candidate process (a political rather than a legal practice), is also likely to be attempted for the 2024 elections.

This briefing explores the legal framework of the EU electoral rules, highlighting which aspects are governed by national rules, and describes the innovations the reforms currently on the table could bring. It also analyses decisions on the composition of Parliament and initiatives to strengthen the resilience of the electoral process.

Read the complete briefing on ‘European elections 2024: Rules of a pan-European democratic event‘ in the Think Tank pages of the European Parliament.

Written by Marketa Pape.

Access to housing in the EU has become problematic in recent years. Demography and urbanisation-related structural factors, aggravated by the COVID-19 pandemic, the conflict in Ukraine, soaring energy prices, the cost-of-living crisis and (already high) housing prices that keep rising are preventing many people from accessing decent housing solutions. The lack of affordable housing supply only adds to this situation. These difficulties affect not only low- but now also middle-income households, as well as specific vulnerable groups, among them young people. Overall, there is not enough ‘social housing’ provision in the EU to meet increased demand.

While both the EU and the United Nations recognise the right to housing, the longstanding crisis in housing affordability has had an adverse impact on people’s living standards, well-being and social inclusion. This is especially the case with young people, many of whom are struggling to access any form of decent housing, in particular in cities. Throughout the EU, the number of young people experiencing homelessness is on the rise.

The primary responsibility for housing policies in the EU lies with the Member States, while the concrete provision of social housing is often ensured by regions and cities. The EU has no direct competence in the area of housing and only a limited scope of action to address social issues, yet it provides relevant guidance and funding. Furthermore, certain EU rules have an indirect impact on housing provision.

This briefing provides an inexhaustive overview of what is being done across the EU to improve housing affordability in general, with a specific focus on making housing accessible to young people.

Several recent developments could be seen as paving the way to a new approach to the provision of affordable housing in the EU.

Read the complete briefing on ‘Social and youth housing in the EU‘ in the Think Tank pages of the European Parliament.

Written by Anna Caprile and Eric Pichon.

This series of maps illustrates Russia’s expanding diplomatic, economic and military engagement across the African continent. It also provides a visual representation of the deployment of hybrid tools, such as information manipulation campaigns, and the multi‑faceted presence of the paramilitary company Wagner, both of which are integral parts of Russia’s current strategy in Africa.

Russia’s full‑scale invasion of Ukraine in February 2022, and the subsequent open confrontation with the West in all arenas, has put the spotlight on the African continent again as an area of geopolitical rivalry. Russia’s current engagement on the continent seeks to break the diplomatic and economic isolation imposed by the West, to reassert its own relevance on the international stage as the champion of the new ‘polycentric world’, and to advance its geo‑strategic ambitions in mining, energy and military presence in key areas, such as the Red Sea and the Mediterranean.

Russia made significant diplomatic efforts to ensure a high turnout at the second Russia‑Africa summit, held in Saint Petersburg in July 2023, which was well attended but by significantly fewer Heads of State than the first summit, in 2019. However, the 2023 summit failed to address several African leaders’ concerns about the impact of the war in Ukraine on their countries’ economies. As evidenced in votes on recent United Nations (UN) resolutions, the African countries’ positions on the war vary greatly. Russia’s expanding influence in Africa also plays out through non‑official channels, such as the use of private military companies (such as the Wagner Group) and information manipulation campaigns.

Russia has concluded military cooperation agreements with 43 African countries, and is a major, though declining, arms supplier to Africa. This cooperation is not linked to democratic pledges, and in multiple African countries hit by coups, Russia has continued or strengthened its military cooperation. Beyond arms, Russia’s trade with Africa is relatively insignificant compared with other trade partners. Russia’s presence is stronger in the African mining and energy markets, notably through mining concessions to Wagner‑associated companies, and it has signed nuclear cooperation agreements with 20 countries, with plans to build nuclear plants in Egypt and Nigeria.

Read the complete briefing on ‘Russia in Africa: An atlas‘ in the Think Tank pages of the European Parliament.

Attendance at Russia-Africa summit (Saint Petersburg, Russia, 27 28 July 2023) Vote on the withdrawal of Russia troops from Ukraine (ES 11/1, March 2022) Vote on an immediate end to the war in Ukraine (ES 11/6, February 2023) Wagner and Russian interference in Africa Russia-Africa military agreements and arms trade, and recent coups Russian arms export to Africa Africa’s main trade partners Russian trade with Africa in a snapshot Energy and mining cooperation

Written by Rachele Rossi and Nikolina Šajn.

The ‘farm to fork’ strategy is about building sustainable EU food systems, in line with the EU’s Green Deal. Launched in May 2020, its elements are moving at different speeds, with much debate on its objectives and priorities. The EU institutions are helping to shape the various elements of the strategy.

EU progress towards implementing the strategy

On 20 May 2020, the EU Commission adopted a communication on ‘A farm to fork strategy for a fair, healthy and environmentally friendly food system’, with priorities and challenges linked to each step in the food chain. The strategy announced both legislative and non‑legislative initiatives, mostly listed in its action plan.

The Commission has so far delivered on some ‘farm to fork’ strategy initiatives, including:

• the 2020 recommendations to EU countries on their common agricultural policy (CAP) strategic plans;
• the 2021 contingency plan to ensure food supply and food security in times of crisis;
• the EU code of conduct on responsible food business and marketing practices, in force as of July 2021;
• new rules on the facilitation of the marketing of plant protection products (pesticides) with biological active substances and the collection of pesticide statistics adopted in 2022;
• rules on the collection of data on sustainable farming practices, adopted in 2023.

Other Commission initiatives, including a legislative framework for sustainable food systems (FSFS, containing a sustainability labelling framework), announced for 2023, have not yet materialised. The timetable for some initiatives (for instance, 2021 for the organic production action plan and better nutrient management action plans) was set in the EU biodiversity strategy. Other initiatives require multiple actions over a longer period. Examples of such initiatives include improving producers’ position in the food chain, which involves implementing EU rules on unfair trading practices and the CAP rules on agricultural markets.

The following tables list ongoing (Table 1) and pending (Table 2) ‘farm to fork’ strategy initiatives.

InitiativeState of playPlant protection products (PPPs)In 2022, the Commission put forward a proposal on the sustainable use of PPPs, but Parliament rejected it, and the Commission announced its withdrawal in 2024.Corporate sustainabilityIn 2022, the Commission proposed a directive on corporate sustainability due diligence. Parliament and the Council agreed a provisional text that awaits formal adoption.Carbon farmingIn 2022, the Commission adopted a proposal on rules on certifying carbon removals on farms, which is currently being negotiated by Parliament and the Council in trilogues.New genomic techniques (NGTs)The Commission put forward a proposal on the NGTs in 2023. Parliament adopted its position in 2024 and the Council has yet to find a common position.Animal welfareIn 2023, the Commission put forward a legislative proposal on the welfare of animals during transport, but not on other animal welfare aspects (see Table 2).Marketing standardsIn 2024, Parliament and Council reached a provisional agreement on the proposal on marketing standards for certain agricultural products (the ‘breakfast directives’), and are also working on the 2023 proposals on plant and forest reproductive material.Food wasteIn 2023, the Commission proposed legally binding targets to reduce food waste, a lot less ambitious than in the strategy. The co-legislators are currently discussing it.Table 1 – Ongoing ‘farm to fork’ strategy initiatives InitiativeState of playSustainable food systemsSubject of a public consultation in 2022 and announced in the Commission work programme for 2023, this leading farm-to-fork initiative has yet to be put forward.Food labellingNo proposals have been submitted for the revised rules on front‑of‑pack nutrition labelling, origin indication for certain products, and ‘use by’ and ‘best before’-date marking, announced for 2022. Similarly, the proposal on the sustainability labelling for food products, announced for 2024, has yet to be submitted.Animal welfare aspectsThe announced legislative proposals on three aspects of animal welfare – keeping of animals, slaughter and labelling of animal products – have not yet been submitted.Nutrient profilesLegislation on nutrient thresholds (announced for 2022) has not yet been put forward.Food contact materialsNew rules on recycled plastic intended to come into contact with food entered into force in 2022, but the overhaul of EU food contact material laws, planned for 2023, is still awaited.Promotion policyFollowing an evaluation, the Commission said it aimed to enhance the role of EU promotion campaigns for agri‑food products in sustainable production and consumption in 2022. The proposal has yet to be published.Marketing standardsThe proposal on marketing standards for fish and seafood products is still outstanding.Food procurement and school schemeThe Commission announced it would propose minimum criteria for sustainable public procurement of food in 2023, but has not yet done so. The review of the legal framework for the EU school scheme is now expected by the end of March 2024.Feed additivesCurrent feed additives rules were expected to be revised in 2021. The revision was initially postponed for 2023 and is now not expected to take place before the end of 2024.Table 2 – Pending ‘farm to fork’ strategy initiatives The debate around the strategy

Generally greeted as a long‑awaited move towards a more sustainable food system, the ‘farm to fork’ strategy nevertheless came under criticism as it was not accompanied by an impact assessment, even though various studies warned that some of the elements risked having a negative effect on agricultural production. The Commission assured that impact assessments would be available for individual initiatives. In the wake of the pandemic and Russia’s war on Ukraine, a debate has emerged around whether the sustainability goals harm or improve food security. In January 2024, the European Scientific Advisory Board on Climate Change criticised the Commission’s failure to deliver some of the initiatives. The Board considered that for agricultural emissions to decrease, more adequate financial incentives for farmers are needed. Currently, none of the remaining initiatives are included in the Commission’s tentative agenda.

What’s next?

The debate on the sustainability of the EU’s farming and food system is now shifting to the strategic dialogue on the future of EU agriculture, launched by the Commission in January 2024. Meetings planned with a wide range of stakeholders as part of this dialogue will explore ways to ensure a fair standard of living for the farmers, while keeping within climate targets, using technological innovation and promoting a ‘thriving future’ for the EU food system.

Read this ‘at a glance’ note on ‘EU ‘farm to fork’ strategy: State of play‘ in the Think Tank pages of the European Parliament.

Written by Karoline Kowald and Marianna Pari, with Roberto Gallo.

For the first time ever, the European Parliament and the Council have agreed to revise the ceilings of the EU’s multiannual financial framework. The agreement affects the remaining years of the current financial period: 2024 to 2027. The European Parliament had demanded a revision to enable the EU to rise to its challenges effectively. At the special European Council meeting on 1 February 2024, the EU Heads of State or Government reached a highly anticipated decision on the revision following the deadlock of their December meeting. This opened the way for the final negotiations with Parliament and, on 6 February, the negotiators reached a political agreement. Parliament is expected to vote on giving its consent during its 26-29 February plenary session.

The core element of the political agreement is the decision to establish predictable and stable financial support for Ukraine, totalling €50 billion from 2024 to 2027. The funds will be provided through a new framework, the Ukraine Facility, endowed with €33 billion in loans, guaranteed by the EU budget, and €17 billion in grants, financed by the EU budget through a special instrument.

In addition to the financial support for Ukraine, the EU budget will provide €14.6 billion to cope with migration needs, support key technologies and enhance the EU budget’s flexibility, of which €10.6 billion originates from a redeployment of funds. The overall reinforcement of the EU budget amounts to €31.6 billion in grants for current priorities, with €21 billion in ‘fresh money’ from the Member States. This includes the €17 billion that will go to the Ukraine Facility.

As requested by the European Parliament, a mechanism will be introduced over and above the budget’s ceilings to cover over-runs in the borrowing costs of the EU’s recovery fund, Next Generation EU. In negotiations with the Council, Parliament also secured the smooth implementation of the EU4Health programme.

Read the complete briefing on ‘First-ever revision of the EU’s long-term budget: Agreement between Parliament and Council‘ in the Think Tank pages of the European Parliament.

Written by Ralf Drachenberg.

‘This is Europe’ – an initiative proposed by the President of the European Parliament, Roberta Metsola – consists of a series of debates with EU leaders to discuss their visions for the future of the European Union. EU unity was a central theme in the address of the President of Romania, Klaus Iohannis, to the European Parliament on 7 February 2024. Iohannis also emphasised the EU’s values and model of democracy, pointing to the European elections as a key moment in the continent’s democratic process. For the Romanian President, the EU must assume a leading global role in maintaining the international order, as a precondition for preserving our way of life and the EU’s values. In that context, he sees the strengthening of the EU’s internal resilience as a fundamental condition for a stronger Union and for its increased geopolitical role. Iohannis stressed the benefits of EU membership whilst outlining how enlargement makes the EU more attractive. Finally, he emphasised the need to streamline the EU’s decision-making capacity and – without excluding changes to the Treaties eventually – to use all available possibilities under the existing Treaties to smooth decision-making.

Defending democracy, territorial integrity and sovereignty, as well as the rules-based international order cannot be subject to any ‘fatigue’.

Klaus Iohannis

Background

Roberta Metsola launched the ‘This is Europe’ initiative shortly after her election as President of the European Parliament in January 2022. Klaus Iohannis is the 12th EU leader to have addressed the Parliament since its Conference of Presidents endorsed the initiative on 28 April 2022.[1] These debates will continue during subsequent sessions. A similar Parliament initiative, ahead of the 2019 European elections, saw 20 EU leaders speak in Parliament’s plenary sessions about their views on the future of Europe. Iohannis, who is currently the third-longest-serving member of the European Council, also took part in that series. A 2019 EPRS analysis of the future of Europe debates pinpointed the similarities and differences in EU leaders’ views.

The ‘This is Europe’ initiative is particularly relevant in the context of the follow-up to the Conference on the Future of Europe (CoFoE), and the preparations for the Strategic Agenda 2024-2029. The CoFoE produced 49 proposals on the EU’s future policies and functioning (see the EPRS overview), including more than 300 measures by which they might be achieved. Research by EPRS has shown that there is significant convergence between the results of the CoFoE and the priorities of the European Council, as expressed in the latter’s Strategic Agenda 2019‑2024 and its conclusions.

Figure 1 – Time devoted by Klaus Iohannis to various topics in his speech

The ‘This is Europe’ initiative is particularly relevant in the context of the Conference on the Future of Europe (CoFoE), and the preparations for the Strategic Agenda 2024-2029.

The CoFoE produced 49 proposals on the EU’s future policies and functioning (see the EPRS overview), including more than 300 measures by which they might be achieved. Research by EPRS has shown that there is significant convergence between the results of the CoFoE and the priorities of the European Council, as expressed in the latter’s Strategic Agenda 2019‑2024 and its conclusions over the past three years. The European Council, on the initiative of its President, Charles Michel, has started the reflection process on the priorities for the next institutional cycle, which will lead to the Strategic Agenda 2024-2029. The first step in the reflection process was a discussion at the informal European Council meeting in Granada on 5-6 October 2023, on the basis of general questions formulated by Charles Michel. The next step involves a series of consecutive group meetings with a small number of EU leaders representing a mix of geographical regions in the EU, political party affiliations and diversity of opinion. Three meetings have taking place to date: on 13 November in Berlin, 14 November in Copenhagen and 16 November in Zagreb. Another meeting is expected to take place in Paris at the end of November.

Main focus of Klaus Iohannis’s speech

Iohannis covered a number of topics in his speech to Parliament (see Figure 1), devoting most attention to i) EU unity, ii) EU values and democracy, iii) EU resilience, and iv) public trust in institutions.

EU unity

Iohannis argued that the EU’s unity had been repeatedly tested and had not faltered, underlining that this had been a strategic advantage in recent crises. He stressed the need to ‘maintain the Union on the path of success, staying true to our vision of a united and stronger Europe’.

EU values and democracy

He reiterated his strong commitment to the EU values, notably unity, solidarity, cohesion, and the rule of law, as stated for example in the May 2019 Sibiu declaration (see EPRS analysis). He declared he would remain deeply faithful to these values and principles in his future endeavours

EU resilience

The Romanian President outlined that strengthening the EU’s resilience was a fundamental condition for a stronger Union and for its increased geopolitical role. This broad priority includes different policy areas, notably responding to hybrid threats, developing technology, such as artificial intelligence, fighting climate change, stimulating competitiveness through industrial production, and sustainable supply chains.

Public trust in institutions

He warned of a crisis of public trust in our institutions, and of rising euroscepticism, which offers wrong and dangerous solutions to Europe’s challenges. He therefore emphasised that it was everyone’s common duty ‘to be honest in our communication with the European citizens’.

Specific proposals and positions

President Iohannis used the opportunity to present his views on how the European Union should advance in specific areas, summarised below.

Policy issuePriority action and proposals (quotes)Public trust in institutions‘We need to do more to promote the feeling – and the certainty – that we are all part of the same community of values, which must be protected by every single one of us.’EU’s global role‘The European Union must assume a leading global role in preserving the international order, as a precondition for preserving our way of life and our values.’Security and defence‘While working in full complementarity with NATO, it is indeed high time to deliver on our European ambitions when it comes to our defence industry.’Enlargement‘Enlargement is an essential part of our strategic answer to the geopolitical developments and a key investment in lasting peace, stability, and democracy in our neighbourhood.’Table 1 – Specific proposals made by Klaus Iohannis, by policy area Comparison with Iohannis’s 2018 Future of Europe speech

When Klaus Iohannis spoke before the Parliament over 5 years ago, on 23 October 2018 as part of the Future of Europe debates, EU unity was also the central point of focus in his vision for Europe. Back then, he emphasised i) the EU’s global role, ii) security, and ii) defence. When comparing the two speeches, there is a lot of consistency in the focus points, although new EU priorities, also addressed in the later speech, have emerged since the earlier speech as a result of recent crises.

Read this ‘at a glance’ note on ‘‘This is Europe’ debate in the European Parliament: Speech by Klaus Iohannis, President of Romania, 7 February 2024‘ in the Think Tank pages of the European Parliament.

Written by Monika Dulian.

The Energy Community is an international organisation facilitating energy cooperation; it brings together the EU and neighbouring countries. Established by the Treaty establishing the Energy Community, signed in 2005 in Athens, Greece, it has been in force since 2006. The treaty’s validity has been extended twice, most recently until 2036. The signatories to the treaty are the EU and nine contracting parties: Albania, Bosnia and Herzegovina, Kosovo, North Macedonia, Georgia, Moldova, Montenegro, Serbia and Ukraine. There are also three permanent observers: Armenia, Norway and Türkiye. EU Member States may become participants in the Energy Community.

The Treaty establishing the Energy Community is designed to bring the contracting parties closer to the EU by facilitating reform and gradually extending the EU acquis on energy, environment and climate to their respective territories. The Energy Community’s objectives as defined by the treaty include: building a regulatory and market framework enabling investment in power generation and networks; creating an integrated energy market in the region (including infrastructure) compatible with the EU energy market; ensuring energy supply security; and promoting climate‑friendly energy sources. The climate and energy policies of the Energy Community countries are those enshrined in the EU Green Deal and are reflected in their commitment to the Decarbonisation Roadmap, based primarily on the 2030 energy and climate targets.

In response to the energy crisis following Russia’s full-scale invasion of Ukraine, the Energy Community contracting parties implemented emergency regulations (on gas storage and solidarity). The European Community is also active in supporting Ukraine through the Ukraine Support Task Force, which provides equipment needed to repair damage to energy systems caused by the war. To finance this activity, the Energy Community set up the Ukraine Energy Support Fund. Ensuring that Ukraine’s reconstruction and recovery is in line with the EU Green Deal could become a centrepiece of the Energy Community’s mission in the coming years.

Read the complete briefing on ‘Energy Community: Creating an integrated pan-European energy market‘ in the Think Tank pages of the European Parliament.

Written by Clare Ferguson and Katarzyna Sochacka.

A highlight of the February I 2024 plenary session was the debate on the conclusions of the special European Council meeting on 1 February, at which leaders reached agreement on EU funding, in particular for Ukraine. That was followed by a debate with the Council and Commission on the need for unwavering EU support for Ukraine, after two years of Russia’s war of aggression against Ukraine. Members also debated empowering farmers and rural communities and ensuring sustainable and fairly rewarded EU agriculture.

Further debates took place on the Commission’s new communication on the EU2040 climate target, the state of EU solar industry in the light of unfair competition, and water crisis and droughts in the EU and the need for a sustainable, resilient water strategy for Europe. Members discussed the Dentsu tracking case and the Commission’s lack of transparency with regard to the tobacco industry. They discussed the situation of prisoners in Hungarian jails, allegations of Russian interference in EU democratic processes and the need to fight rising antisemitism and anti-Muslim hatred. Debates took place on quality traineeships in the EU and the commemoration of the 70th anniversary of Abbé Pierre’s appeal to address homelessness. Other debates took place on international issues: the situation in Haiti on the eve of the deployment of the United Nations Multinational Security Support Mission, further repression against democracy in Venezuela, the state of play of the implementation of the Global Gateway, and multilateral negotiations in view of the World Trade Organization’s 13th Ministerial Conference, in Abu Dhabi.

Finally, a ‘This is Europe’ debate was held with the President of Romania, Klaus Iohannis.

Plants obtained by certain new genomic techniques

Plant breeding has changed greatly in the two decades since the EU adopted its rules on genetically modified organisms (GMOs), with advances in biotechnology allowing new ways to introduce genetic changes. Such ‘new genomic techniques’ (NGTs) can help secure enough food for everyone and reduce waste, for instance by producing bananas that do not go brown. Members debated and adopted a Committee on Environment, Public Health and Food Safety (ENVI) report on plants obtained by certain new genomic techniques, which now sets Parliament’s position for negotiations with the Council. The ENVI committee report includes a ban on companies taking out patents on such plants. The proposal categorises the plants as NGT1 (equivalent to conventional plants) and NG2 – which would be subject to EU GMO legislation. The committee’s report proposes to strengthen the rules on what can be considered an NGT1 plant, guarantee seed traceability, and create a public database of NGT1 plants. It agrees to maintain GMO requirements for NG2 plants, including compulsory labelling, introduces a fast-track risk assessment procedure, and insists on respect of the ‘precautionary principle’. The rules would also ban use of NGT plants in organic agriculture.

Automated data exchange for police cooperation (Prüm II)

The EU’s Prüm framework allows EU law enforcement authorities to exchange data on DNA, fingerprints, and vehicle registration. While this has greatly enhanced police cooperation, challenges persist. Members considered and adopted an interinstitutional compromise on a new ‘Prüm II’ regulation regarding automated data exchange for police cooperation, recently endorsed by its Committee on Civil Liberties, Justice and Home Affairs (LIBE). The scope of data searches will be extended to facial images of suspects and convicted persons, police records (on a voluntary basis), data allowing human remains to be identified and for missing person searches. Parliament has insisted that data matches undergo human review and a proportionality check, to ensure respect for fundamental rights.

Instant payments in euro

To allow us to make secure instant payments in euro, without paying large fees, the Commission has proposed new rules that should also help to fight financial crime. Parliament considered and adopted a provisional political agreement reached between Parliament and Council negotiators that would oblige payment service providers to offer instant credit transfers, processed within seconds, apply standard charges and undertake a number of checks to ensure the money is not used for criminal activities.

Protection of workers: Limit values for lead and diisocyanates

Lead is highly toxic to human health. Many materials used in construction, motor vehicle and furniture manufacturing also contain diisocyanates, which can cause asthma and skin disease. In February 2023, the Commission put forward a proposal for a directive aimed at revising existing limit values for lead, and introducing limit values for diisocyanates. The proposal aims to safeguard people who have to work with these chemicals. Members debated and adopted a provisional agreement, recently endorsed by Parliament’s Committee on Employment and Social Affairs (EMPL), that would update lead exposure rules for the first time in 40 years, limit exposure values for diisocyanates for the first time and better protect female workers.

Waste from electrical and electronic equipment (WEEE)

Members adopted a provisional agreement on amending the legislation on waste from electrical and electronic equipment to avoid imposing a retroactive obligation on producers (mainly of solar panels). During interinstitutional negotiations, Parliament’s ENVI committee succeeded in amending the proposal to ensure an assessment by the end of 2026, among other things.

Transposing Atlantic tuna fisheries measures

As a contracting party to the International Commission for the Conservation of Atlantic Tunas (ICCAT), which regulates tuna fisheries, the EU played an important role in deciding new measures to reduce sea turtle bycatch and restrict recreational albacore fishing. During this plenary session, Parliament adopted a provisional agreement (based on a report from its Committee on Fisheries – PECH), on transposing new ICCAT binding provisions into EU law. The agreed text will transpose the 2022 decisions in addition to the 2006, 2016-2019 and 2021 decisions. The agreement amends the Regulation on a Bluefin tuna management plan, seeks to clarify language and to ensure a level playing-field between EU and non-EU operators.

Opening of trilogue negotiations

Members voted to approve a LIBE committee decision to enter into interinstitutional negotiations on a temporary derogation from certain provisions of the ePrivacy Directive for the purpose of combating online child sexual abuse. Four other decisions – from the LIBE committee on judicial cooperation: transfer of proceedings in criminal matters; from the PECH committee on conservation, management and control measures applicable in the area covered by the Convention on future multilateral cooperation in the North-East Atlantic fisheries data; from the Committee on Legal Affairs (JURI) on company law: time limits for the adoption of sustainability reporting standards for certain sectors and for certain third-country undertakings; and from the Committee on Economic and Monetary Affairs (ECON) on amending certain financial services and investment support regulations as regards certain reporting requirements – were approved without vote.

Read this ‘at a glance’ note on ‘Plenary round-up – February 2024‘ in the Think Tank pages of the European Parliament.

Written by Issam Hallak.

The capital markets union (CMU) is an EU political project aimed at ‘de-fragmenting’ the markets for corporate financing. The primary objective is to ensure that firms with comparable characteristics obtain comparable financing conditions – especially as regards costs and volumes – regardless of the Member State in which they are located. The objective to de-fragment capital markets is influenced by the context of European monetary union and the single market for goods and services; fragmented financial markets have adverse effects on the conduct of euro monetary policy, as well as on fair competition between EU firms – the level-playing field. The second major objective of the CMU is to expand the financial means and instruments available to EU corporations through wider de-fragmented EU capital markets offered to EU companies, as well as regulatory intervention. This aspect is of greater relevance to the financing of innovation and would be reflected in the ‘attractiveness’ of the EU capital markets to both firms seeking funding and investors.

The first major CMU policy action agenda was set out in 2015, and the second in 2020. Actions address a wide range of aspects of EU capital markets, and seek three objectives: a) transparency and centralisation of information, b) removal of cross-border obstacles for investment within the EU, and c) regulatory tools to expand financing resources and financial instruments.

Steps towards an effectively integrated EU capital market are therefore being taken one by one, taking Member States’ specificities into consideration. In the meantime, the incompletely integrated EU capital markets maintain economic discrepancies and divergences between EU Member States, while EU firms with significant innovation and growth potential may continue to lack the financial investment they need from the private sector.

Read the complete briefing on ‘Capital markets union: Overview and state of play‘ in the Think Tank pages of the European Parliament.

Written by Pieter Baert.

EU Member States’ public finances have been under considerable strain owing to both the COVID-19 pandemic and the twin energy-cost-of-living crisis. To bolster EU economies in the wake of these challenging times, various initiatives were taken forward at EU level to simplify tax compliance for businesses operating across borders, and to ensure that taxpayers were paying their fair share. As the current Commission’s mandate approaches its conclusion, this briefing looks at some notable achievements and anticipates potential future action in the field of taxation.

Accomplishments and ongoing work

Despite facing significant economic challenges, the fiscal stability of EU Member States has demonstrated resilience in recent years. National tax administrations have responded rapidly to constantly changing circumstances and have been quick to install tax benefits for the poorest households or to provide tax relief for struggling businesses. Fortified by a strong economic rebound, tax revenue as a percentage of EU gross domestic product returned to its pre-pandemic average in 2022 (41 %). To support the European economy’s rebound, the European Commission put forward a ‘package for fair and simple taxation‘ in July 2020, listing 25 distinct (soft or hard law) initiatives the Commission would undertake in the area of taxation during its mandate. One year later, this was followed up by a communication on ‘business taxation for the 21st century‘, listing a number of additional potential legislative proposals. With these initiatives, the Commission aimed to reduce tax obstacles for businesses in the single market, and help Member States enforce existing tax rules and fight tax fraud and aggressive tax planning.

The key milestone was the 2021 OECD/Inclusive Framework agreement on a two-pillar solution to reform international corporate tax rules, supported by nearly 140 countries, including all EU Member States. The subsequent adoption of the global minimum corporate tax (‘Pillar Two’) in the EU has ensured that large multinationals operating in the EU are today subject to a tax burden of at least 15 %. While there has been some delay, a multilateral convention to implement the other half of the global tax deal (‘Pillar One’, concerning taxing rights on profits made by very large multinationals) will be open for signature soon, with the new rules entering into force in 2025.

Another important achievement was the agreement to broaden the information exchange between tax authorities (DAC8): from 2026, tax administrations will have a better overview of the crypto-asset transactions made and proceeds gained by EU customers, thereby reducing the risk of tax evasion. Agreements were also reached on public country-by-country reporting (requiring multinationals to reveal publicly how much corporate tax is paid per EU country they are operating in) and the modernisation of rules for value added tax (VAT) rates (for example, phasing out reduced VAT rates on fossil fuels). Meanwhile, some EU countries undertook measures against aggressive tax planning as part of their national recovery plans under the NextGenerationEU mechanism.

Today’s globalised economy also requires close cooperation with third countries to achieve EU tax policy objectives. The UK-EU economic partnership agreement, following the UK’s withdrawal from the EU, includes a protocol oncombating VAT fraud together. The EU’s process of listing third countries that fail to comply with international good governance tax standards has served as an incentive for many of these countries to improve their practices.

Meanwhile, the legislative process on some of the European Commission’s other tax initiatives is still ongoing, such as the proposals to create a harmonised corporate tax base and to update energy taxation rules (see Table 1). The Belgian presidency of the Council will continue to work on these files and is aiming to finalise agreements on both the ‘FASTER’ proposal – for faster and safer relief of excess withholding taxes – and on the proposal on ‘VAT rules for the digital age’, in particular before the European elections.

Legislative proposalAimEuropean Parliament (non-binding opinion)Energy taxationAlign taxation of energy products and electricity with EU Green Deal objectivesAwaiting Committee decisionUnshellCounter shell companies when they are used for abusive tax purposesOpinionVAT in the digital ageReduce need for multiple VAT registrations, harmonise VAT reporting standards and fight fraudOpinionDebt-equity bias reduction allowance (DEBRA)Reduce debt-equity bias in corporate tax, encourage the re-equitisation of companies and strengthen capital markets unionOpinionFaster and safer tax excess relief (FASTER)Simplify, digitalise, accelerate withholding tax relief and strengthen capital markets unionAwaiting Parliament’s voteBusiness in Europe: Framework for income taxation (BEFIT)Harmonise corporate tax base, lower business compliance costs and increase tax certaintyAwaiting Committee decisionHead office tax system (HOT)Lower tax compliance costs of small businesses operating across bordersAwaiting Committee decisionTransfer pricingEnshrine transfer pricing principles within EU law, increase tax certainty and prevent double taxationAwaiting Committee decisionTable 1 – Ongoing initiatives in the Council in the area of taxation (non-exhaustive) What might the future bring?

The European Commission did not put forward a charter on taxpayer’s rights – initially planned for 2021. This charter was intended to pinpoint lingering tax barriers within the single market and recommend best practices drawn from across the EU to enhance taxpayers’ experiences, addressing issues such as the speed of VAT refunds. Commissioner Paolo Gentiloni envisaged this initiative being taken forward ‘at a later point in time’. One key concern has been the tax difficulties faced by cross-border teleworkers, and both the European Parliament and the European Economic and Social Committee have called on the Commission to take action in this area.

Given the great number of initiatives taken in the past few years to fight tax avoidance, the Commission is currently assessing ‘the effectiveness, efficiency and continued relevance’ of the directive on administrative cooperation (through which national tax authorities share an increasing amount of tax-related information with their EU counterparts). The European Parliament and Court of Auditors have already suggested several improvements.

The European Commission has also started preparatory work on potential future legislative initiatives. For example, a VAT and tourism package is being developed. This would modernise VAT rules for travel agencies but may also review VAT exemptions in international air and maritime transport in the context of the Green Deal. Additionally, the VAT exemption for financial and insurance services is under evaluation.

Other challenges on the horizon may be the future implementation of Pillar One, as concerns continue to grow over the potential non-participation of the United States. MEPs have called on the EU to come forward with a unilateral measure – a digital levy on digital companies or similar – in case there is a clear lack of progress on Pillar One; this levy could feed into the EU budget.

Read this ‘at a glance’ on ‘EU tax achievements: Looking back (and forward)‘ on the Think Tank pages of the European Parliament.

Written by Gisela Grieger.

The World Trade Organization (WTO) will hold its 13th Ministerial Conference (MC13) in Abu Dhabi from 26 to 29 February 2024. Priority items on the MC13 agenda are likely to include the reform of the WTO’s dispute settlement function; new disciplines to eliminate fisheries subsidies that encourage overfishing and overcapacity, to complement the multilateral Agreement on Fisheries Subsidies adopted at MC12 in June 2022 and currently under ratification; the integration of the plurilateral Investment Facilitation Agreement into the WTO legal architecture; and the extension of the e-commerce moratorium. WTO members are set to endorse formally the WTO accession of Comoros and Timor-Leste, increasing the organisation’s membership to 166.

Restoring a fully and properly functioning WTO dispute settlement system

Since December 2019, the Appellate Body – the second instance of the WTO’s dispute settlement body – has been paralysed, after the United States (US) repeatedly blocked the nomination of new judges to review appeals of first-instance panel reports. In line with the MC12 mandate to restore a functioning dispute settlement system by 2024, WTO members have held informal negotiations on two separate tracks: one that has led to a draft consolidated text on issues other than the appeal mechanism, and another for the debate on the appeal mechanism that as of January 2024 was still focused on ‘the identification of certain concepts that could offer a solution to this critical issue’. Speaking for the Appellate Body’s main critics, US Trade Representative Katherine Tai, at the G20 Summit in India in August 2023, stated that the ongoing new and constructive process of reforming the WTO’s dispute settlement function ‘requires a fundamental rethink’ with a view to ending ‘the practice of judicial rulemaking’, among other things. She emphasised that the US had tabled 30 ideas, including on the appeal mechanism. At a US think-tank event in September 2023, she specified key points of the US position, e.g. the need for appropriate alternatives to litigation (leading by example, the US recently resolved all its trade disputes with India through methods other than litigation), an end to ‘judicial overreach’, for WTO members’ policy space to be restored, to allow them to regulate on climate-change issues and non-market practices, and for members to remain free in their legitimate national-security judgements. Some commentators do not expect a breakthrough at MC13, since the 2024 deadline coincides with the US presidential election year, in which repairing a system that in the US is perceived by both Democrats and Republicans as having allowed the ‘China shock‘ that eliminated millions of US jobs would politically be very challenging for the Biden administration.

Complementing the Agreement on Fisheries Subsidies

MC12 ended with the adoption of a multilateral Agreement on Fisheries Subsidies that prohibits support for illegal, unreported and unregulated (IUU) fishing, bans support for fishing overfished stocks, and ends subsidies for fishing on the unregulated high seas. WTO members have since negotiated a ‘second wave‘ of disciplines eliminating fisheries subsidies that contribute to overcapacity and overfishing. In January 2024, they held a ‘Fish month’ based on the latest endorsed draft text, with the aim of transmitting a clean text to ministers at MC13. Experts have stressed that WTO members continue to diverge on a wide range of topics, including on the details of exemptions for developing countries. Acceptances from two-thirds of WTO members are required for the Agreement to enter into force. By January 2024, 55 WTO members, i.e. roughly one-third of the WTO membership, had transmitted their instruments of acceptance.

Incorporating the Investment Facilitation Agreement into WTO legal architecture

In July 2023, a subset of more than 110 WTO members finalised negotiations on a plurilateral Investment Facilitation Agreement aimed at eliminating red tape that hampers investment. They opted for a plurilateral negotiating format to develop new WTO rules as a way of overcoming deadlock if consensus is elusive. The talks were launched under a 2017 Joint Statement Initiative after the failure of multilateral trade negotiations on a range of topics under the 2001 Doha Development Round. The 118 countries have since sought to incorporate the agreement, whose benefits would accrue to all WTO members under the most-favoured nation principle, into the WTO legal architecture as an ‘Annex 4 agreement‘. This requires consensus from all 164 current WTO members, some of which, including India and South Africa, are strongly opposed to such a move. They argue that only rules negotiated by all WTO members should be added to the WTO rulebook. Only 9 % of WTO members have never participated in a WTO plurilateral deal.

Extending the e-commerce moratorium

Since MC2 in 1998, WTO members have regularly extended the moratorium on the imposition of customs duties to electronic transmissions as part of the work programme on e-commerce, while the definition of ‘electronic transmissions’ as well as the moratorium’s scope and impact have remained controversial. Absent an MC13 decision to extend it, the moratorium will expire automatically in March 2024. The related debate at MC13 could yet again pit developed countries such as the EU and the US, which support the moratorium, against developing countries such as India and South Africa, which call for ending it. The latter have long claimed that, adding to the growing digital divide between developed and developing countries, the moratorium prevents developing countries from taking advantage of the growing imports of electronic transmissions. However, the US has argued that, as some studies have shown, a decrease in digital trade resulting from ending the moratorium would lead to a bigger economic loss for developing countries than potential foregone customs revenue. According to a 2023 Organization for Economic Co-operation and Development (OECD) study, the cost of terminating the moratorium would be considerable. A 2023 International Monetary Fund (IMF) report emphasises other methods of revenue collection resulting from digital trade. As of December 2023, differences among WTO members on the moratorium’s future persist, ‘including the need for more discussions on its definition, scope and impact’.

Extending the TRIPS waiver for COVID-19 vaccines to diagnostics and therapeutics

At MC12, WTO members endorsed a five-year waiver for intellectual property (IP) protection under the WTO agreement on trade-related aspects of intellectual property rights (TRIPS), to enable developing countries to manufacture and distribute COVID-19 vaccines. WTO members also mandated a decision within six months on a potential extension of this waiver to the production and supply of COVID-19 diagnostics and therapeutics, as requested by India, South Africa and some 63 other WTO members. The debate in the WTO seems to have entered an impasse. US lobby groups as well as lawmakers have pressed the Biden administration to oppose a waiver extension. The former are concerned that the extension could stifle medical research, the latter that it ‘could outsource to foreign countries advanced manufacturing and research jobs that should exist in the United States’. A 2023 US International Trade Commission report states that ‘the wide disparity among countries in their ability to access COVID-19 diagnostics and therapeutics is the result of multiple factors, including access to IP, prices and affordability, regulatory approvals, healthcare infrastructure, and the healthcare priorities of governments’. The EU’s December 2023 statement to the WTO General Council on the follow-up to MC12 issues notes ‘that little progress has been made in this complex discussion and the positions of Members remain far apart’.

In February 2023, the European Commission submitted its most recent reform proposals to the WTO. They target three key areas for focused deliberation at MC13, namely trade policy and state intervention to support industries; trade and global environmental challenges; and trade and inclusiveness. In its resolutions, the European Parliament has been calling for WTO reform since 2008. In its resolution of 28 November 2019 on the crisis of the WTO Appellate Body, Parliament notably urged WTO members to preserve an independent two-tier WTO Appellate Body. Parliament has regularly adopted its position ahead of WTO ministerial conferences, such as MC12. In view of the forthcoming MC13, Parliament’s Committee on International Trade (INTA) on 24 January 2024 adopted a motion for a resolution by co-rapporteurs Bernd Lange (S&D, Germany) and Jörgen Warborn (EPP, Sweden). The draft resolution identifies revitalising a functioning WTO Appellate Body as a top-priority MC13 deliverable. Members also call on the WTO membership to ratify the Agreement on Fisheries Subsidies, to conclude its second phase, and to find a ‘fair and permanent’ solution for the e-commerce moratorium, emphasising the considerable dynamics in digital trade that [by 2020] accounted for 25 % of global trade. During the first February 2024 plenary session, Members are set to hold a debate on the forthcoming MC13 following a statement from the Commission, and to vote the resolution. A delegation of Members, led by INTA Chair Bernd Lange, is set to travel to Abu Dhabi at the end of February for the Parliamentary Conference session on the WTO.

Read this ‘at a glance’ on ‘Preview of the World Trade Organization’s 2024 Ministerial Conference‘ on the Think Tank pages of the European Parliament.

Written by Marcin Szczepański.

The EU and the UK are key automotive trading partners. After the UK left the EU, the two parties concluded a Trade and Cooperation Agreement, committing them among other things to a progressive increase in the EU and UK content in the electric vehicles (EVs) and EV batteries they trade, to avoid tariffs. As the European EV batteries sector is not sufficiently developed, the parties have agreed to extend the current rules until 2027.

EU and UK car markets Share of UK EV market in 2022 Data source: ACEA Factsheet, 2023.

In 2022, the United Kingdom (UK) was the EU’s second biggest export destination for cars, accounting for 17 % of total exports, halfway between the United States (23 %) and China (15 %). Between 2002 and 2022, the EU had a surplus in its car trade with the UK; this surplus peaked at €26 billion in 2015, falling to €17 billion in 2022. The EU is the UK’s largest market for total vehicle imports and exports (see chart).

Importantly, both parties have legal commitments not to sell new cars with combustion engines from 2035 onwards. The volume of trade in EVs is already significant. In 2022, the UK exported more than 47 000 EVs to the EU with a total value of €1.2 billion. In the same year, the EU exported nearly 140 000 new EVs to the UK, worth €5.1 billion. In 2022, there was a total of 642 000 EVs in the UK, compared with over 1 million in Germany and a total of 3 million in the EU as a whole.

Post-Brexit EV trade framework

Following the UK’s withdrawal from the EU, the two parties signed a Trade and Cooperation Agreement (TCA) laying down the rules governing trade between them, with effect from 1 May 2021. Annex 5 of the TCA contains transitional product-specific rules for electric batteries and EVs. These include provisions on rules of origin – the criteria for establishing that a product is of EU or UK origin and therefore qualifies for the preferential trade regime under the TCA. For EV battery packs or battery cells to be recognised as being of EU or UK origin – and therefore eligible for zero tariffs – certain percentages of their value must originate in either the EU or the UK. These thresholds were set to increase progressively over the years, so as to phase in a full rules-of-origin regime from 1 January 2027 (see Table 1). Vehicles and batteries that do not meet the requirements face a 10 % tariff at either the EU or the UK border.

1 May 2021 to 31 December 20231 January 2024 to 31 December 2026From 1 January 2027Vehicle value40 %45 %55 %Battery pack30 %60 %70 %Battery cell30 %50 %60 % Major developments since 2020

The rationale behind the rules was to incentivise investment in domestic battery manufacturing capacity. However, the rules were agreed prior to the emergence of major social and economic developments that had a strong disruptive effect on the EU and UK supply chains and automotive sectors. Disruptions started with the COVID-19 pandemic and were further exacerbated by Russia’s war of aggression against Ukraine. The resulting shortages (in particular of semiconductors) and shocks to both demand and supply caused problems for both the EU and the UK automotive sectors. More recently, these sectors have faced increased competition as a result of a number of new external subsidy support schemes, such as the US Inflation Reduction Act, diverting investment in battery ecosystems away from the EU and the UK. Prices of raw materials have also soared owing to shortages coupled with rising global demand.

China has given massive support to its EV industry with a mix of under-priced loans, equity injections, purchase subsidies and government contracts. Experts accuse the country of disregarding global trade rules and applying forced technology transfers. The EU has recently launched an anti-subsidy investigation into imports of Chinese EVs. The global market share of Chinese EVs is growing: in the EU, it has recently risen to 8 % and may reach 15 % by 2025. In the UK, it has soared from 1.7 % in 2019 to nearly 32 % in 2022.

According to the European Commission, these factors have ‘led to a situation where the scaling-up of the European battery ecosystem has been slower than initially anticipated’.

European Parliament

In a 23 November 2023 report on the implementation of the EU-UK TCA, MEPs called for reasonable solutions to be found for EV rules of origin, given the difficulties encountered by EU manufacturers in sourcing parts, in particular batteries, from within the EU. It pointed out that any exception would risk shifting investment away from the EU and should be assessed in the light of the European economic security strategy. The Parliament also encouraged the UK to consider re-joining the Regional Convention on pan-Euro-Mediterranean preferential rules of origin (PEM Convention). The convention, signed by the EU and 21 countries, facilitates trade by making rules of origin simpler and more flexible.

Extension of the original rules

Under the EU-UK TCA, the first increase in thresholds for domestic content were supposed to apply from 1 January 2024. In the run-up to the deadline, EU and UK carmakers issued numerous warnings signalling that they could not meet the heightened requirements. The European Automobile Manufacturers’ Association (ACEA) estimated that a 10 % tariff could cost the industry €4.3 billion, potentially reducing EV production by nearly 500 000 units. Higher EV prices (as much as €4 100 per vehicle) would likely benefit China, which despite paying the 10 % tariff has steadily increased its market share in both the EU and the UK by offering cheaper cars. Market analysts also pointed out that the EU is growing increasingly dependent on imports of cheap Chinese EV batteries, with the Chinese battery companies’ EU market share set to increase from 30 % to 50 % between 2023 and 2027. ACEA argued that EU and UK EV supply chains were not ready to fit within the thresholds.

On 6 December 2021, having listened to the views of industry and the UK government, the Commission submitted a proposal to the Council with a number of palliative measures. One of these was a one-off extension – until 31 December 2026 – of the first set of rules of origin featuring the lowest thresholds (left column in Table 1). From 1 December 2027, the final, most stringent rules of origin would apply as originally set (right column in Table 1). The effect of the extension would be the removal of the 1 January 2024 tariff cliff edge. Another measure was the introduction of a lock-in mechanism to prevent any further changes from being made before 2032. To help industry prepare for the higher requirements applicable from 2027, a third measure involved setting up a dedicated instrument for the battery value chain under the Innovation Fund, with a financial envelope of up to €3 billion. After the Council approved the proposal on 21 December 2023, it was adopted by the TCA Partnership Council on the same day.

Views and outlook

The extension of the current rules was met with overwhelming approval from the automotive industry in both the EU and the UK. The UK in Changing Europe research consortium stated that 3 years was a limited time window that might not be enough to scale up the EV industry sufficiently. Michael Gasiorek from the University of Sussex Business School argued that PEM Convention membership would be beneficial for the UK automotive industry, particularly in light of the tariffs, while not serving as a silver bullet capable of removing post-Brexit trade obstacles. Niall Moran from Dublin City University stressed that the shortage of raw materials facing both EU and UK battery makers presented a strong case for integrating their supply chains. It is however unclear whether such a rapprochement is possible, or if EU-UK relations are to remain indefinitely within the limits of the TCA.

Read this ‘at a glance’ on ‘EU – UK rules of origin for electric vehicles and batteries‘ on the Think Tank pages of the European Parliament.

Written by Clément Evroux (1st edition).

On 29 November 2023, the European Commission adopted a proposal for a directive amending Directive (EU) 2015/2302 on package travel and linked travel arrangements, to improve protection for travellers and simplify and clarify certain aspects of the current directive. The Commission announced in a 2020 communication on a new consumer agenda that it would look into revising the directive following the turmoil caused by the mass cancellations during the COVID-19 pandemic.

The proposal is the result of two years of stakeholder consultations and a reassessment of the current rules. The main changes focus on securing travellers’ rights and improving insolvency protection. Other key changes include extending the directive’s scope to lay down rules on contracts between package organisers and service providers.

In the European Parliament, the file has been referred to the Committee on the Internal Market and Consumer Protection (IMCO). A rapporteur was appointed on 8 January 2024.

Complete version

• February 2024: ‘Package travel and linked travel arrangements: Improving protection for travellers‘ (1st edition)

Proposal for a directive amending Directive(EU) 2015/2302 to make the protection of travellers more effective and to simplify and clarify certain aspects of the DirectiveCommittee responsible:Internal Market and Consumer Protection (IMCO)COM(2023) 905
29.11.2023Rapporteur:Alex Agius Saliba (S&D, Malta)2023/0435(COD)Shadow rapporteurs:Ordinary legislative
procedure (COD)
(Parliament and Council
on equal footing –
formerly ‘co-decision’)Next steps expected: Publication of draft report

Written by Nikolina Šajn (1st edition).

On 5 July 2023, the European Commission put forward a proposal for a regulation on the production and marketing of forest reproductive material (FRM) to replace the current FRM Council Directive. The proposal would widen the scope of the current legislation to include not only FRM intended for forestry purposes, but also FRM intended for biodiversity conservation, restoration of forest ecosystems and climate adaptation and mitigation. The proposal would specify the rules for the production and marketing of FRM intended for conserving forest genetic resources and would for the first time require that potential buyers be provided with information on the suitability of FRM for current and future climatic and ecological conditions. Member States would have to establish contingency plans to ensure a sufficient supply of FRM in cases of extreme weather events, wildfires and disease and pest outbreaks.

In the European Parliament, the file has been referred to the Committee on Agriculture and Rural Development, where discussions on the rapporteur’s draft report are ongoing. In the Council, the proposal is being examined by the working party on genetic resources and innovation in agriculture.

Complete version

• February 2024: ‘Forest reproductive material‘ (1st edition)

Proposal for a regulation of the European Parliament and of the Council on the production and marketing of forest reproductive material, amending Regulations (EU) 2016/2031 and 2017/625 of the European Parliament and of the Council and repealing Council Directive 1999/105/EC (Regulation on forest reproductive material)Committee responsible:Agriculture and Rural Development (AGRI)COM(2023) 415
5.7.2023Rapporteur:Herbert Dorfmann (EPP, Italy)2023/0228(COD)Shadow rapporteurs:Isabel Carvalhais (S&D, Portugal)
Irène Tolleret (Renew, France)
Martin Häusling (Greens/EFA, Germany)
Ivan David (ID, Czechia)
Bert-Jan Ruissen (ECR, Netherlands)
Luke Ming Flanagan (GUE/NGL, Ireland)Ordinary legislative
procedure (COD)
(Parliament and Council
on equal footing –
formerly ‘co-decision’)Next steps expected: Vote in committee on draft report

Forest area in Europe by number of tree species in 2015

Written by Clément Evroux (1st edition).

On 17 October 2023, the Commission adopted a proposal for a directive amending Directive 2013/11/EU on alternative dispute resolution (ADR) for consumer disputes, as well as Directive 2015/2302/EU on package travels, Directive 2019/2161/EU on better enforcement and modernisation of Union consumer protection rules, and Directive 2020/1828 EU on representative actions for the protection of the collective interests of consumers. ADR is defined as settling a complaint out of court with the assistance of an impartial dispute resolution body.

The Commission’s proposal covers the situation where a relationship between a consumer and a trader gives rise to a complaint from the consumer. Since 2013, the share of e-commerce has increased significantly in the EU economy, up from 2 % to 4 % of EU gross domestic product (GDP). Each year, around 300 000 eligible disputes between consumers and traders are examined by the ADR entities, with resolution rates ranging from 17 % to 100 % across the Member States.

The proposal pursues three objectives: adapting the ADR legislative framework to digital markets; facilitating the use of ADR in cross-border disputes; and simplifying ADR procedures. In Parliament, the file has been referred to the Committee on the Internal Market and Consumer Protection.

Complete version

• February 2024: ‘Alternative dispute resolution‘ (1st edition)

Proposal for a directive amending Directive 2013/11/EU on alternative dispute resolution as well as Directives (EU) 2015/2302, (EU) 2019/2161, and (EU) 2020/1828)Committee responsible:Internal Market and Consumer Protection (IMCO)COM(2023) 649
17.10.2023Rapporteur:Laura Ballarin Cereza (S&D, Spain)2023/0376(COD)Shadow rapporteurs:Katrin Langensiepen (Greens, Germany)Ordinary legislative
procedure (COD)
(Parliament and Council
on equal footing –
formerly ‘co-decision’)Next steps expected: Adoption of the draft report

State of play in the use of ADRs across Member States In 2023, the Commission published the second report on the implementation of Directive 2013/11/EU, pursuant to Article 26 of the Directive (the first report was published in 2019). Overall, the report confirms that Member States successfully established the framework required for ADR entities to operate. It is estimated that, among around 430 such entities notified to the Commission by the national competent authorities, 64 % deliver non-binding outcomes and 20 % deliver outcomes that are binding on both parties, while the remaining outcomes are binding only upon traders. Among the 23 Member States which provided data, around 300 000 eligible disputes are presented on an annual basis, with an average resolution rate above 50 %. Average duration of an ADR dispute in the EEA (in days)

Written by Branislav Staníček.

On 17 December 2023, Serbia held snap parliamentary elections, just 20 months after the last ones. President Aleksandar Vučić had called early elections after what had been an adverse year for his ruling Serbian Progressive Party (SNS), marked by two mass shootings in May 2023 and a clash between Serb paramilitaries and the Kosovo police near the Banjska Monastery in northern Kosovo on 24 September 2023. The elections brought the SNS a larger-than-expected victory. While alleged electoral irregularities sparked a protest movement led by a coalition of opposition parties, Serbia against Violence, the SNS’s strong performance will boost its chances of staying ahead of the opposition in the spring round of local elections as well.

Background

On 1 November 2023, the Serbian President, Aleksandar Vučić, dissolved the parliament and scheduled early parliamentary elections for 17 December, citing demands from the opposition for snap elections. These were the third parliamentary elections in less than 4 years. Preliminary results confirmed the strong popularity of both the ruling Serbian Progressive Party (SNS) and of Vučić, who is at its helm, with the SNS having won some 46.72 % of the vote compared with 44.3 % in April 2022. The ruling party also came first in the Belgrade local elections, although with a more modest 39.3 %. On 3 January 2024, Serbia’s Election Commission published the official results after it became clear that the repeated vote in eight polling stations had not changed the outcome. The ruling SNS won 46.75 % of the votes, while the largest opposition coalition, Serbia against Violence (SPN), won 23.66 %. The SNS’s junior partner, the Socialist Party of Serbia (SPS), won 6.55 %. Two right-wing opposition lists also passed the threshold: the coalition NADA (Hope), led by the New Democratic Party of Serbia (DSS), with 5 %, and the populist list We – Voice of the People, headed by a well-known pulmonologist and COVID-vaccination sceptic Branimir Nestorović, with 4.69 %. Freedom House rates Serbia as ‘partly free’, ranking it 60th out of 100 countries in 2023.

Concerns following the elections

The elections raised some concerns, both among international observers and opposition parties. The Organization for Security and Co-operation in Europe’s Office for Democratic Institutions and Human Rights (OSCE/ODIHR), which led an inter-institutional electoral observation mission, published its preliminary findings and conclusions on 18 December. It stated that ‘though technically well-administered and offering voters a choice of political alternatives, [early parliamentary elections] were dominated by the decisive involvement of the President which[,] together with the ruling party’s systemic advantages[,] created unjust conditions’. The same day, one of the SPN coalition leaders, Marinika Tepić, started a hunger strike in support of the protest movement requesting the annulment of the vote. The SPN emerged as a result of the protests following the May 2023 mass shootings in a Belgrade elementary school and in the villages of Mladenovac and Smederevo. As recalled in the European Commission’s 2023 annual report on Serbia, the parliament constituted in August 2022 included the opposition parties that boycotted the 2020 elections. ‘Political polarisation remained in evidence during 2023 and has further deepened following the tragic mass shootings in early May 2023’, the report stresses.

Analysts believe that the democratic credentials of the electoral process were marred by the SNS’s advantage in resources and media dominance, and by their vote-buying, intimidation and pre-election budgetary handouts. According to Radio Free Europe, the SNS appears to have brought busloads of people – who had only recently been registered on Belgrade’s electoral roll – into the city. Irregularities have often been reported in Serbian elections. Furthermore, Serbian politics remains marked by a strong political divide and by the opposition parties boycotting the parliamentary debate and work. At the same time, experts from Oxford Analytica see no evidence that machinations were more excessive than usual or that they alone accounted for the SNS’s strong performance. Instead, the machinations employed appear to have improved the SNS’s overall results largely at the expense of the Socialist Party of Serbia (SPS).

International reactions

In a 19 December joint statement on the parliamentary elections, the EU’s High Representative, Josep Borrell, and the Commissioner for Neighbourhood and Enlargement, Olivér Várhelyi, took note of the preliminary findings and conclusions of the ODIHR observers. They highlighted that ‘credible reports of irregularities [should be] followed up in a transparent manner by the competent national authorities. This includes also allegations related to the local elections in Belgrade and other municipalities’.

Stewart Dickson, the spokesperson on observation of local and regional elections of the Council of Europe Congress of Local and Regional Authorities, expressed grave concern over the serious irregularities reported by the Congress’s partners in their joint International Election Observation Mission during Serbia’s early parliamentary elections. ‘The reported instances of intimidation and pressure on voters, including vote-buying … are very worrying allegations that could seriously infringe citizens’ right to vote and undermine their trust in the democratic electoral process at all levels of government’, he remarked.

The US State Department said it was reviewing the findings of the OSCE observer mission. The State Department urged Serbia to work with the OSCE to address ‘unjust conditions’ surrounding the electoral process.

EU-Serbia relations

After Serbia applied for EU membership on 22 December 2009, its accession negotiations began in 2014. Some 18 out of the 35 acquis chapters have been opened, including all those in cluster 1 on the fundamentals. Two chapters have been provisionally closed. Pre‑accession support for Serbia and other candidate countries amounts to €12.9 billion for the 2021‑2027 period (Instrument for Pre-accession Assistance, IPA III).

Serbia and Kosovo have been engaged in EU-mediated dialogue since 2011, following the adoption of UN General Assembly Resolution 64/298 in 2010. Serbia would need to implement the agreement made in Ohrid in March 2023 as part of the requirements under Chapter 35 (‘Other Issues’) of the country’s EU accession negotiations, which include, among other things, normalisation of relations with Kosovo. The geopolitical dimension of the EU’s enlargement policy gained in significance in 2022, following Russia’s aggression in Ukraine. The European Council in December 2023 decided to endorse the EU’s enlargement policy reforms and reiterated its support for the integration of the Western Balkans into the EU.

The war in Ukraine also exposed the considerable extent of Russian political and economic interference in the Balkans. Russia remains Serbia’s biggest arms supplier, although it is facing increasing competition from China. Responding to this challenge, the EU decided to step up its enlargement policy efforts, and investment in the accession countries through the growth plan for the Western Balkans, which has a budget of €6 billion in grants and loans to be spent on accelerating economic convergence with the EU.

European Parliament’s position

Five Members of the European Parliament (MEPs) observed the December 2023 elections as part of the OSCE/ODIHR-led International Election Observation Mission. The MEPs noted, in line with the preliminary OSCE/ODIHR report, that overall, the elections had been conducted and managed well from a technical standpoint, but that unjust conditions had persisted and irregularities had been reported.

On 23 January 2024, the Foreign Affairs Committee (AFET) discussed the Serbian elections with two European Commission and European External Action Service (EEAS) representatives, both of whom said that Serbian authorities had expressed readiness to address the OSCE/ODIHR’s recommendations once the final report was published (so far, only the preliminary findings have been published). Many MEPs reiterated their calls for the holding of an investigation into the alleged electoral irregularities. The OSCE/ODIHR final report will serve as a valuable tool for improving electoral conditions in Serbia. Most recently, the European Parliament discussed Serbia’s December 2023 elections during its January plenary session. A resolution is expected to be voted during the February I plenary session.

The European Parliament adopted its resolution on the 2022 Commission report on Serbia in May 2023, underlining that progress on the rule of law and fundamental rights and the functioning of democratic institutions is fundamental in determining the dynamics of the country’s accession process.

Read this ‘at a glance’ on ‘Situation in Serbia following the 2023 elections‘ on the Think Tank pages of the European Parliament.