European Parliamentary Research Service Blog

Written by Saša Butorac.

CONTEXT

Timely, cost-efficient expansion and modernisation of the European energy infrastructure is one of the key challenges in the EU’s ongoing energy transition. Grid development is needed to ensure energy supply security, increase the resilience of Europe’s energy system and integrate the rapid roll-out of renewable energy sources. Cross border infrastructure plays a vital role in connecting national energy networks..

Meeting the 2030 interconnection targets is particularly important for completing the energy union and reaching European Union energy and climate goals. Given the scale of investment required, the persistent governance challenges around cross‑border projects and the need to enhance the robustness of the scenarios on which they are based, the European Commission has put forward a proposal to revise the TEN‑E regulation, as part of the European grids package published on 10 December 2025. The proposal is one of two legislative initiatives forming the core of the package (the other is on accelerating permit‑granting procedures).

Legislative proposal

2025/0399(COD) – Proposal for a regulation of the European Parliament and of the Council on guidelines for trans-European energy infrastructure, amending Regulations (EU) 2019/942, (EU) 2019/943 and (EU) 2024/1789 and repealing Regulation (EU) 2022/869 – COM(2025) 1006, 10 December 2025.

NEXT STEPS IN THE EUROPEAN PARLIAMENT

For the latest developments in this legislative procedure, see the Legislative Train Schedule:

2025/0399(COD)

Read the complete briefing on ‘Guidelines for trans-European energy infrastructure Revision of the TEN E Regulation‘ in the Think Tank pages of the European Parliament.

Written by Victoria Martin de la Torre.

Commemoration of the liberation of Auschwitz

On 27 January 1945, the Auschwitz-Birkenau camp was liberated, after some 1.1 million people – mostly Jews, but also Poles, Roma, Soviet prisoners of war and people of other nationalities – were murdered there. This year, survivor Tatiana Bucci, who was six years old when she was deported to Auschwitz with her family, will address MEPs, recalling that around 1.5 million Jewish children were murdered in the Holocaust.

Role of the European Parliament

In 1995, Parliament called for a Holocaust Remembrance Day in all Member States, and in January 2005 proposed 27 January as the EU’s Day of Remembrance of the Holocaust. In November 2005, the United Nations General Assembly designated 27 January as an international day of commemoration to honour Holocaust victims. Since 2005, Parliament has marked this date every year.

Parliament’s Vice-President responsible for Holocaust Remembrance Day and the fight against antisemitism is Pina Picierno (S&D, Italy). The House of European History, established at Parliament’s initiative in Brussels, features a permanent exhibition on the Holocaust and offers the Hidden Children – Survivors of the Holocaust in Brussels, a guided educational and commemorative walk for young people.

In October 2017, Parliament called on the Member States to mark 2 August as the date to remember the victims of the Roma Holocaust and to include this community in Holocaust Remembrance Day. In June that year, Parliament called on the Member States to adopt and apply the working definition of antisemitism employed by the International Holocaust Remembrance Alliance, so as to identify and prosecute antisemitic attacks more efficiently and effectively. In October 2018, in relation to the rise of neo-fascist violence in Europe, Parliament drew attention to growing violence against Jews, and called on the Member States to counter Holocaust denial and trivialisation, and to mainstream Holocaust remembrance in education.

Parliament regularly adopts resolutions on fundamental rights in the EU, addressing a wide range of issues such as human dignity, freedom, minority rights and antisemitism. Its September 2022 resolution on the situation of fundamental rights in the EU (2020-2021), for instance, provided an overview of antisemitism, racism, discrimination against LGBTIQ persons, anti-gypsyism and xenophobia.

In 2023, Parliament’s Committee on Civil Liberties, Justice and Home Affairs (LIBE) began work on a report supporting the extension of the list of EU crimes in Article 83 of the Treaty on the Functioning of the European Union to include hate speech and hate crime, in response to a 2021 Commission communication. If the list is extended, Parliament and the Council may then establish minimum rules on the definition of criminal offences and sanctions across the EU. Parliament endorsed the report in plenary on 18 January 2024.

The European Parliament’s Working Group against Antisemitism, bringing together more than 80 Members from across the political groups, cooperates with all EU institutions.

This is an update of an ‘At a glance’ note from January 2025 drafted by Alina-Alexandra Georgescu.

Read this ‘at a glance’ note on ‘Holocaust Remembrance Day 2026: Through the eyes of a child‘ in the Think Tank pages of the European Parliament.

Written by Clare Ferguson and Katarzyna Sochacka.

Members debated with the European Council and European Commission on the conclusions of the European Council meeting of 18 December 2025 and the geopolitical tensions currently facing Europe. Parliament also heard and debated a presentation of the Cyprus Council Presidency’s programme of activities.

Several debates on external issues were held with the High Representative for Foreign Affairs and Security Policy, Kaja Kallas, including: on the territorial integrity and sovereignty of Greenland and the Kingdom of Denmark and the need for a united EU response to the United States, the situation in Venezuela following the extraction of Maduro and the need to ensure a peaceful democratic transition, and Iran’s brutal repression of protesters.

Further debates were held following Council and Commission statements on: preparations for the EU-India Summit; tackling AI deepfakes and sexual exploitation on social media through full use of the EU’s digital rules; the pending approval of the Hungarian national plan for Security Action for Europe (SAFE) funding; the attempted takeover of Lithuania’s public broadcaster and the threat to democracy in Lithuania; online piracy of sports and other live events; and the proposed cybersecurity and digital networks acts.

Finally, Members rejected a motion of censure against the European Commission, and adopted a resolution requesting an opinion from the Court of Justice on the compatibility of the proposed EU–Mercosur Partnership Agreement (EMPA) and Interim Trade Agreement (ITA) with the EU Treaties.

40th anniversary of the accession of Spain and Portugal to the European Union

Celebrating the 40th anniversary of the accession of Spain and Portugal to the European Union, His Majesty Felipe VI, King of Spain, and His Excellency Marcelo Rebelo de Sousa, President of the Republic of Portugal, addressed Parliament in a formal sitting. Parliament also observed a minute’s silence in memory of the victims of the rail accident in Spain on 18 January.

Air passenger rights

Proposed reform of EU air passenger rights to address issues such as delays, cancellations, weak enforcement and unclear rules had been stalled in the Council for over a decade due to disagreements on compensation, extraordinary circumstances and enforcement. Members debated and adopted a recommendation from the Committee on Transport and Tourism (TRAN) at second reading. The report rejects the Council’s position in favour of higher delay thresholds and reduced compensation, and supports distance-based compensation of €300-€600, a closed list of exemptions, and stronger passenger protection, such as free hand luggage, bans on unfair fees and longer claim deadlines. The file now returns to the Council for its second reading, with conciliation to follow unless the Council accepts Parliament’s amendments.

Critical medicines act

Critical medicine shortages and the EU’s growing reliance on external suppliers for critical ingredients pose a threat to EU public health. The proposed ‘critical medicines act’ aims to improve the availability and security of supply of critical medicines in the EU by decreasing dependency on single suppliers and non-EU countries, such as India and China, and improving pharmaceutical manufacturing in the EU. Members debated and approved a report from the Committee on Public Health (SANT) regarding the proposed regulation, and set Parliament’s position for trilogue negotiations. The report expands the definition of a ‘strategic project’ to improve EU manufacturing capacity and calls for the creation of a critical medicines security fund within the 2028-2034 multiannual financial framework, and an EU coordination mechanism for national stockpiles and contingency stocks of critical medicines.

28th regime

The 28th regime is a proposed EU-level legal framework that would allow innovative companies to operate across the EU under a single set of rules. Companies would not have to deal with differing regulations across Member States, which would help boost the single market. Parliament debated and adopted a legislative-initiative report on the 28th regime from the Committee on Legal Affairs (JURI). The report suggests national limited liability companies be able to register as ‘Societas Europaea Unificata’ (S.EU), which would be automatically recognised in all Member States. It recommends a harmonised EU legal framework for corporate law to align national rules across all Member States, while ensuring safeguards for national laws to avoid undermining labour and social laws. It proposes a common digital direct entry point allowing entrepreneurs to establish companies within 48 hours, and harmonised rules on employee financial participation schemes.

Just transition in the world of work

Parliament debated and adopted a legislative-initiative report from the Committee on Employment and Social Affairs (EMPL) proposing a new directive to protect workers who may become unemployed in the move towards a greener and more digital society. The report calls on the European Commission to create a comprehensive framework to ensure EU countries create jobs in regions where jobs are most likely to disappear. This framework should ensure the development of viable economic 2

alternatives and attract the necessary investment. The report also calls to set certain workplace conditions, including the right to training during working hours, health and safety measures, the right to worker consultation and collective bargaining and stronger protections against unfair dismissal. It also calls for increased support for a just transition in the 2028-2034 MFF. Lastly, the proposed directive would require Member States to develop national strategies and business support programmes for small and medium-sized businesses.

Drones and new systems of warfare

The EU is facing a rising drone threat linked to Russian provocations, and is boosting drone and counter-drone capabilities. Parliament debated and adopted an own-initiative report from the Committee on Security and Defence (SEDE) setting out a comprehensive strategy to prepare the EU for drone-enabled conflict, calling for the rapid integration of drone and counter-drone capabilities across EU defence planning and stronger protection of civilian infrastructure. It stresses the need to build a robust, autonomous European drone industry, reduce reliance on non-EU suppliers and shift from a primarily regulatory approach to a security model focused on operational capabilities and strategic autonomy.

CFSP and CSDP 2025 annual reports

Members considered and approved the 2025 annual implementation reports on common security and defence policy from the Committee on Security and Defence (SEDE) and on common foreign and security policy from the Committee on Foreign Affairs (AFET). Both reports identify Russia’s war against Ukraine as a primary threat to the EU and Member States, and call for stronger support for Ukraine to protect European security. They both acknowledge the importance of EU relations with the United States in securing peace in Ukraine, with the SEDE report noting the risks of isolationist US foreign policy and expressing concern at the US government’s threats against Greenland’s sovereignty. The AFET report highlights the current global geopolitical instability and accelerated erosion of democratic norms, stating that the EU’s credibility depends on its ability to act coherently and decisively. It calls for a gradual transition to qualified majority voting for common foreign and security policy decisions without military or defence implications, while encouraging greater use of constructive abstention.

Human rights and democracy in the world and the 2025 EU annual report

Members also debated and adopted a resolution on the AFET committee’s annual report on human rights and democracy in the world. This report aims at informing a post-2027 EU action plan for human rights and democracy, and reiterates Parliament’s call for a stronger plan based on a full review of the current framework, with clear benchmarks, indicators and timelines. It highlights growing threats to human rights and the international system, proposes improvements to EU tools such as human rights dialogues, support for human rights defenders, conditionality in EU trade and international agreements and human rights sanctions. It also stresses the need for earmarked funding for human rights anddemocracy support in the next MFF, notably through the proposed Global Europe instrument.

Opening of trilogue negotiations

Two decisions to enter into interinstitutional negotiations – from Parliament’s Committees on Defence (SEDE) and Internal Market (IMCO) on simplification of intra-EU transfers of defence-related products and the simplification of security and defence procurement and acceleration of permit-granting for defence readiness projects, as well as one further decision from the Committees on Defence (SEDE), Environment, Climate and Food Safety (ENVI) and Industry, Research and Energy (ITRE) on defence readiness and facilitating defence investments and conditions for defence industry were approved without vote.

Read this ‘at a glance note’ on ‘Plenary round-up – January I 2026‘ in the Think Tank pages of the European Parliament.

Written by Silvia Kotanidis.

Background

In her political guidelines for 2024-2029, European Commission President Ursula von der Leyen paid special attention to the role of citizens in our democracy as she pledged to strengthen citizens’ voice in the EU and to step up engagement with civil society organisations (CSOs). Following up on this, the Commission announced a comprehensive strategy on CSOs in its 2025 work programme. This initiative was praised by a number of CSOs and stakeholders and EU bodies such as the European Economic and Social Committee. Many stakeholders have in fact been voicing concern about shrinking civic space, which has sparked a range of recommendations, including calls for policy interventions. The European Parliament, too, in a resolution from March 2022, recognised the stress under which CSOs increasingly operate and called for a range of interventions such as an EU alert mechanism, a statute for European cross-border associations, enhanced monitoring to ensure that civic space is not negatively affected, including the use of infringement procedures, a coherent policy framework to foster inclusive participation, and ‘long-term predictable, adequate and enabling financing for CSOs’, in addition to a reduction in red tape.

The strategy

On 12 November 2025, after a public consultation which attracted a significant number of contributions from CSOs, including ones from third countries, the Commission issued a communication outlining the EU strategy for civil society. This document builds on existing frameworks and sets out concrete actions at EU and national level, in order to protect CSOs within and outside the EU. The strategy is addressed to CSOs covering a broad set of organisations: non-state, not-for-profit, independent, non-partisan, non-violent organisations, through which people pursue and defend shared objectives and ideals, including human rights defenders (HRD). The protection offered is aimed at those CSOs that are accountable, independent, transparent and respect EU common values of democracy, dignity and respect for fundamental freedoms.

The strategy is based on three main pillars.

The first pillar focuses on strengthening effective engagement with CSOs as partners in governance. The strategy recognises that CSOs contribute by providing advice and expertise in many fields and that they help shape EU policies. In addition to the existing tools (e.g. Have your say, better regulation tools, local councillors, civil society dialogues, consultations), the strategy identifies 10 guiding principles that must be observed in the dialogue with civil society: partnership; comprehensiveness; predictability and regularity as to the dialogue; transparency; representation; inclusivity; accessibility; accountability; resourcing; and safety. The strategy also emphasises the importance of Commission Recommendation 2023/2836 on promoting the engagement and effective participation of citizens and civil society organisations in public policy-making processes, which calls on Member States to enable CSOs to participate. The Commission, to enhance the role of CSOs as partners in policymaking, made a number of commitments: to establish a Civil Society Platform and to organise an annual summit of the Platform; to promote the 10 guiding principles mentioned above; to engage with civil society through existing or newly created toolssuch as the Youth Advisory Board, the Youth Stakeholders Group, the Youth Dialogue and policy dialogues; to engage with citizens’ panels as a way to create a bridge between CSOs and citizens; to support national capacity-building; and to institutionalise and standardise in-country consultations of CSOs.

The second pillar highlights the need to support and protect CSOs. In this respect, the Commission acknowledges the difficulties faced by CSOs, such as an increasing range of threats, from attacks on their staff to smear and disinformation campaigns. Both preventive and reactive measures are therefore proposed, together with increased engagement to monitor the challenges faced by the civic space. Further to existing tools (its annual rule of law reports, SLAPP legislation (strategic lawsuit against public participation), the Citizens, Equality, Rights and Values programme (CERV) and the European fact-checking network), the Commission committed to: creating an online knowledge hub on civic space, to document existing civic space monitoring initiatives, reports and protection resources; exploring ways to strengthen CSOs and HRDs at risk in the EU; supporting training for justice professionals on SLAPPs that target CSOs, and litigation on rights derived from the Charter; supporting national capacity-building in implementing Recommendation 2023/2836; and strengthening the EU’s warning system where civic space is shrinking in enlargement countries.

The third pillar of the strategy focuses on ways to provide ‘long-term, predictable and sufficient funding’. Funding can be of a public or private nature. In the latter case, it is necessary to create a favourable environment for private donors in which philanthropic freedom is protected. The EU already supports CSOs financially through programmes like CERV, Agora EU, Erasmus + and the EU Solidarity Corps. For the future, the Commission will explore possible funding gaps, work to connect communities and pro bono lawyers with CSOs across sectors, and explore possibilities to extend financial support to third-party schemes across relevant EU funding programmes.

Finally, the strategy highlights the need to support civil society in EU external action. To that end, the Commission committed, among other things, to strengthening dialogue with CSOs in all policy areas, including through EU delegations; consulting CSOs in the preparation of the EU action plan on human rights and democracy; and strengthening CSOs’ participation in multilateral fora.

Reactions to the strategy

While there is an overall consensus that such an initiative was long overdue, reactions to the strategy have been mixed. The Good Lobby and La Strada International considered the strategy to be a good starting point, but that it is not enough and needs consistent follow-up by the Commission; other commentators highlighted the contradictions with the Commission’s approach to policymaking, which often sidelines CSOs. Civil Society Europe considered the strategy to be a positive signal overall, while the European Civic Forum and the European Centre for Not-for-profit Law emphasised the importance of implementation. Liberties lamented the lack of concrete actions, while the European Movement International considered the strategy to be a significant step in embedding democratic resilience.

Read this ‘at a glance’ note on ‘An EU strategy for civil society‘ in the Think Tank pages of the European Parliament.

Written by Pieter Baert.

Simplification strategy

As highlighted in the recent reports by Mario Draghi and Enrico Letta, barriers to cross-border business operations continue to hinder the effective functioning of the EU single market. Removing such obstacles is not only central to the idea of the EU, but also represents an important opportunity for economic growth. In response, the European Commission has launched a broad initiative to ‘stress-test’ the entire EU rulebook to eliminate overlaps, contradictions, and unnecessary complexity. This agenda includes legislative simplification, for instance through a series of Omnibus proposals, and renewed efforts to deepen the single market. Among the options under consideration is the introduction of a ’28th regime’, to offer innovative companies a pan-European legal framework that companies can opt into.

In terms of taxation policy, the European Commission intends to table an omnibus package on taxation for the second quarter of 2026, and a recast of the Directive on Administrative Cooperation (DAC).

Costs, fragmentation and uncertainty

In the context of cross-border activity, a tax obstacle can be understood broadly. It not only refers to explicit discrimination, but to any fiscal or administrative friction, such as: legal uncertainty; duplicative reporting requirements that disproportionately affect cross-border activity, as businesses must navigate multiple tax authorities; reporting systems; relief procedures; and divergent interpretations of the same EU rules. From an economic perspective, such barriers distort competition by favouring firms that remain domestic or that already operate at scale. They weaken the competitive pressure that the single market is meant to generate, with knock-on effects on prices, innovation, and market concentration. Empirical evidence further suggests a negative impact on investment decisions when businesses face uncertainty about the final tax treatment of an investment.

Any discussion of tax barriers must start from a fundamental legal and political reality: direct taxation remains largely within the competence of the Member States. Member States retain the right to determine who is taxed, on what, when, and at what rate, leaving the EU with a mandate to act only as necessary for the establishment and functioning of the internal market. These limited legal pathways for the EU result in distinct national tax environments, compelling cross-border workers and businesses to navigate different tax rulebooks including those governing labour income, corporate income, and capital gains. Attempts at harmonisation are long-standing: the idea of a common corporate tax base has been discussed since the 1960s. However, successive proposals failed to secure sufficient support, and the most recent proposal – BEFIT – is pending in the Council since 2023.

Even in areas where EU law provides a common framework, tax barriers can remain pervasive. For instance, despite the existence of the VAT Directive, value added tax (VAT) was identified as the most frequently reported tax-related obstacle in the single market in the Commission’s 2025 Single Market and Competitiveness Report. A particularly acute problem is VAT registration in another Member State. While the underlying VAT concepts are largely harmonised, administrative procedures are not. Registration procedures can vary widely between Member States in terms of documentation requirements, digitalisation, and processing times (see Table 1). The forthcoming expansion of the VAT One-Stop Shop under the VAT in the digital age package will significantly lower the need for multiple VAT registrations. However, where a company carries out activities outside the scope of the One-Stop Shop or where timely recovery of input VAT is commercially critical, companies may still need, or choose, to obtain VAT registrations in several Member States, each subject to national administrative procedures and compliance burdens.

Table 1 VAT registration challenges VAT registrationRegistrationVAT rules may be particularly complex: suppliers may not be aware that they must register for VAT in another country, leading to unintentional non-compliance, disputes and loss of tax revenue.DocumentationDifferent Member States may request different supporting documents (originals/copies) during the registration process (invoices, company statutes, company directors’ identity, etc.).LanguageLanguage barriers can hinder communication for foreign traders. Authorities may require documents in the local language, requiring professional translation.Nature of processDegree of digitalisation varies between Member States; manual procedures, delays and inconsistent follow-up increase uncertainty.ReportingOnce registered, the business must file VAT returns, EC-sales listings, etc.PaymentsOnce registered, the business must remit VAT according to local deadlines.Tax adviceComplexity of registration and subsequent obligations may force businesses to rely on external tax and accountancy expertise.

Table Source: P. Baert, Single market, single VAT registration? Development and future of the one-stop shop, EPRS, European Parliament, 2025

More broadly, the unanimity requirement in tax matters represents a high barrier to achieving legislative progress at EU level. As a result, directives — rather than directly applicable regulations — remain the default legislative instrument. This inevitably leaves room for divergent national transposition and application. In response, the EU has increasingly relied on coordination and soft-law instruments, including guidance issued by the VAT Committee, recommendations and initiatives such as the European Trust and Cooperation Approach (ETACA) framework, to mitigate fragmentation.

New challenges

As the economy evolves, new tax barriers are emerging. Digitalisation has enabled employees to work from anywhere, but where an employee resides in one Member State and works for an employer established in another, overlapping national rules can lead to double taxation, disputes and high compliance costs. Employers may also face a ‘permanent establishment’ risk if an employee’s home office is deemed to create a taxable presence in another jurisdiction. These risks act as hidden barriers to labour mobility within the single market. The Commission plans to propose a recommendation to Member States on this issue in 2026.

The increased ‘servitisation’ of the EU economy presents a further challenge for the single market, as new business models combine elements of both goods and services (e.g. subscription-based manufacturing models). Current VAT rules, however, continue to rely on a rigid distinction between supplies of goods and supplies of services, each with different place of taxation rules. In hybrid scenarios, this can create legal uncertainty and disputes between Member States over taxing rights, increasing compliance costs and litigation risks for businesses.

Read this ‘at a glance’ note on ‘Tax obstacles in the single market‘ in the Think Tank pages of the European Parliament.

Written by Marc Jütten with Angelos Delivorias.

Venezuela under Nicolás Maduro

Nicolás Maduro assumed the Presidency of Venezuela on 8 March 2013, following Hugo Chávez’s death on 5 March. In the subsequent presidential elections on 14 April 2013, Maduro, who represented the governing Socialist Unified Party of Venezuela (Partido Socialista Unido de Venezuela/PSUV), won narrowly over Henrique Capriles, the candidate of the opposition coalition, Democratic Unity Roundtable (Mesa de la Unidad Democrática/MUD).

Since Maduro took power, the country has been suffering from the effects of a deep economic, political, social and humanitarian crisis. Hyperinflation (over 130 000 % in 2018) and large shortages of essential goods were the results of the economic policies and governmental mismanagement under Chávez and Maduro, combined with declining oil production, the global drop in oil prices in 2014, corruption and the impact of US sanctions. As a result, in recent years, 7.9 million Venezuelans have left the country, seeking safety and better opportunities, with more than 6.9 million people (85 %) being hosted in Latin America and the Caribbean. According to the European Commission, around 56 % of the population live in extreme poverty; 40 % of the population experience moderate to severe food insecurity; around 62 % of the population does not have regular access to water; and 70 % of the population have lost access to health system services.

Read the complete study on ‘The US military intervention in Venezuela and the regional and geopolitical context‘ in the Think Tank pages of the European Parliament.

Written by Monika Kiss.

EU passenger rights regulations, covering compensation for denied boarding, cancellations, long delays, and protections for passengers with reduced mobility, addressed some of these issues, although enforcement and awareness remained limited.

In 2013, the European Commission proposed clarifying ‘extraordinary circumstances’, introducing rerouting rights after long delays, banning no-show penalties, improving tarmac delay handling and complaint procedures, while capping accommodation duties and standardising compensation thresholds. The European Parliament’s first-reading report added stronger protections, including a closed list of exceptions, higher accommodation limits, airport contact points, safeguards for passengers in cases of airline bankruptcy, and expanded baggage and accessibility rights. The Council’s 2025 first-reading position maintained rerouting and assistance rights, updated compensation thresholds to four hours for short flights and six hours for longer ones, clarified ‘extraordinary circumstances’, and tightened complaint-handling procedures. Parliament’s second-reading draft rejects higher delay thresholds, keeps compensation at between €300 and €600 by distance, increases free hand luggage, bans unfair ancillary charges, and extends claim deadlines.

Stakeholders, including consumer groups, disability organisations, and airlines, have expressed mixed reactions, with consumer advocates supporting stronger protections, and airlines warning of higher costs. The report is now scheduled for a plenary vote.

Read the complete briefing on ‘Revising air passenger rights: Where do we stand?‘ in the Think Tank pages of the European Parliament.

Written by Isabelle Gaudeul-Ehrhart.

EP Vice-President Victor Negrescu welcomed the audience, drawing their attention to the moral and ethical crisis going on in the world. Values as core to our European societies as truth and democracy are no more a given. He announced that he will be coordinating the reflection group on the future of the institution that Parliament’s Bureau recently decided to set up.

MEP David McAllister, Chair of the Committee on Foreign Affairs – and rapporteur for the 2025 annual report on the implementation of the common foreign and security policy, scheduled for Parliament’s January 2026 plenary – walked the audience through a broad panorama, calling successively at: the price of peace – Russia and the European security order, China – the long game, the transatlantic relationship under pressure, global trade in a fragmented world (“signing new trade agreements is not optional, it is a strategic imperative”), and the new frontier: technology – who controls Europe’s growingly technological future? He concluded with a question: with these developments being more than the sum of their parts, how do we respond as the EU?

Judith Arnal (Centre for European Policy Studies – CEPS and Elcano Royal Institute) explained that in 2026, she will pay special attention to independent authorities’ credibility, transatlantic sanctions over digital regulation, and how the EU’s trade defence instruments deliver.

Rosa Balfour (Carnegie Europe) announced that she would be very direct: to her, 2026 may be the hardest year for the EU. The EU strategy should be to combine short-term tactics with long-term strategy, and make sure that these issues reach citizens – here the European Parliament has a specific role and responsibility.

Joris Teer (EU Institute for Security Studies – EUISS) focused on China’s role in global trade and industry as well as security issues, and explained why more attention should be given to this key actor.

The roundtable was followed by a question-and-answer session and drew an online audience of more than 150 viewers.

Watch the event here.

Read the complete in-depth analysis on ‘Ten issues to watch in 2026‘ in the Think Tank pages of the European Parliament. The publication is available in English, French, German, Italian, Polish and Spanish

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Written by Branislav Stanicek.

In the context of the wars in Ukraine and other parts of the world, the increasingly global effects – material and political – of war make it more important than ever to measure the level of threats to peace, security and democracy around the world. The Normandy Index has presented an annual measurement of these threats since the 2019 Normandy Peace Forum. The results of the 2025 exercise suggest the level of threats to peace is at its highest since the index began, confirming declining trends in global security resulting from conflict, geopolitical rivalry, growing militarisation and hybrid threats. The findings of the 2025 exercise draw on data compiled in 2024 and 2025 to compare peace – defined on the basis of a given country’s performance against a range of predetermined threats – across countries and regions. Derived from the Index, 63 individual country case studies provide a picture of the state of peace in the world today.

Read the complete study on ‘Mapping threats to peace and democracy worldwide: Normandy Index 2025‘ in the Think Tank pages of the European Parliament.

Written by Naja Bentzen.

European Commission proposal

On 12 November 2025, the Commission and the High Representative published a joint communication on the ‘European Democratic Shield: Empowering Strong and Resilient Democracies’ (EDS), in line with the July 2024 political guidelines. The EDS aims to protect democracy against increasingly complex threats, including ‘interference and distortions in the information space’ as well as hybrid threats, aimed at impacting elections and eroding trust in democratic processes.

In parallel and linked to the EDS, the Commission also launched a strategy for civil society. Actions, to be rolled out by 2027, fall under four key pillars:

1. a new European Centre for Democratic Resilience;
2. safeguarding the integrity of the information space;
3. strengthening our institutions, fair and free elections, and free and independent media;
4. boosting societal resilience and citizens’ engagement.

The EDS further builds on the EU’s whole-of-society approach, including its evolving regulatory framework to threats against democracy. A key dimension is digital regulation, including the Digital Services Act (DSA) and the Artificial Intelligence Act. The 2023 defence of democracy package, the regulation on transparency and targeting of political advertising (TTPA), the European Media Freedom Act (EMFA) and the Audiovisual Media Services Directive (AVMSD) are other core pieces of legislation. The framework for restrictive measures in view of Russia’s destabilising actions was broadened in May 2025 to enable the suspension of Kremlin-controlled broadcasters. Other steps include the EU’s hybrid toolbox and FIMI toolbox. In May 2025, the Commission announced €5 million in funding for a European network of fact-checkers, expanding work by the European Digital Media Observatory (EDMO) and the European Fact-Checking Standards Network (EFCSN). As part of the new multiannual financial framework (MFF), the Commission proposes a number of programmes to support the EDS. AgoraEU aims to promote shared values, including democracy, and support the European audiovisual and creative sectors, media freedom and civil society. Other programmes include Horizon Europe, Erasmus+ and the Global Europe Instrument, and possibly defence spending.

A new European Centre for Democratic Resilience

The proposed European Centre for Democratic Resilience is the most visible innovation in the EDS. The Centre would bring together expertise and capacities across Member States, EU candidate countries and potential candidates, and EU institutions, bodies, offices and agencies, including the European External Action Service (EEAS). The Centre would be developed progressively, based on Member States’ voluntary participation, and their input and needs for support and cooperation. In coordination with the EEAS-led Rapid Alert System, the Centre will link existing networks and structures. It will host a stakeholder platform for dialogue with civil society, researchers and academia, media providers, and a new European network of fact-checkers. The Centre would support operational cooperation to counter common threats, particularly FIMI and disinformation, and aim to increase situational awareness and the capacity to detect and anticipate threats, develop a strong early warning system and support rapid response capacity.

Safeguarding the integrity of the information space

Proposed actions to support information integrity complement the existing measures listed above, with implementation and enforcement of the digital legislation as key priorities. Together with the European Board for Digital Services, the Commission will prepare a DSA incidents and crisis protocol in response to large-scale, transnational information operations. The Commission will work with signatories of the Code of Conduct on Disinformation to increase transparency of recommender systems, demonetise disinformation, and explore further measures, including improving the detection and labelling of AI-generated and manipulated content circulating on social media services. Based on the FIMI Toolbox, a Blueprint for countering FIMI and Disinformation will be prepared. The independent European network of fact-checkers will help counter online manipulation, and EDMO’s extended mandate will support situational awareness around elections or crises. A common research support framework will enhance monitoring of information manipulation and disinformation. Moreover, the European Board for Media Services will develop common criteria for media regulators to act against rogue non-EU media operators presenting risks to public security.

Stronger democratic institutions, free and fair elections and free and independent media

In the face of internal and external challenges and attacks on European democracies and electoral processes, a series of proposed measures include stronger cooperation with Member States under the European Cooperation Network on Elections (ECNE) to enhance electoral integrity; guidance on the use of AI in electoral processes; updating of the Digital Services Act Elections Toolkit; and setting up a voluntary EU network of influencers. A proposed new pan-European platform is to make real- time news and information from professional media outlets available to wider audiences in multiple languages. Actions to support and revitalise free, plural and independent media and journalism include reviewing the AVMSD; increasing transparency of online advertising; assessing the fitness of State aid rules for public service broadcasting in the evaluation of the 2009 broadcasting communication; reinforcing measures for the safety of journalists and combating abusive litigation (SLAPPs); and supporting quality independent media and journalism beyond EU borders. Moreover, the Commission will support common work with the Member States on the transparency and integrity of funding in politics, looking at issues of common interest such as anonymous donations and cryptocurrency.

Boosting societal resilience and citizens’ engagement

Actions to empower citizens and boost societal resilience include the 2026 basic skills support scheme for schools, including citizenship and digital skills; and a media resilience programme for all age groups across rural and urban areas. In addition, the communication envisages an EU democracy guide for citizens, to promote citizens’ awareness of their democratic rights, and a European Citizens’ Panel on democratic resilience. Other whole-of-society actions include a high-level event on democracy and an annual award for democratic innovation, and support for voluntary commitments by the private sector to build a business coalition for democracy. To safeguard evidence-based decision-making, the Commission will issue a recommendation on supporting scientific evidence and its use in public policymaking; enshrine the freedom of scientific research in EU law under the European Research Area Act; and assess options for setting up a European Centre of Expertise on Research Security. In addition, the Commission will explore future pathways for the EU’s tech environment, with an initial focus on future social networking/social media platforms, supporting EU digital sovereignty.

Role of the European Parliament

Over the past two legislatures, Parliament has used a mix of tools – non-legislative resolutions, hearings, and its budgetary power – to address challenges to democracies, including from information manipulation and interference. On 18 December 2024, Parliament voted to set up a special committee on the European Democracy Shield (EUDS), which was constituted on 3 February 2025. EUDS further builds on work by two previous special committees on foreign interference (INGE and ING2). In resolutions adopted in March 2022 and June 2023 respectively, Members called for the creation of a European centre for information integrity to facilitate exchange between Member States and EU institutions and agencies. This idea was further developed in the April 2025 EUDS working document. The EUDS is set to propose further solutions to protect democracy in a forthcoming own-initiative report.

Read this ‘At a Glance note’ on ‘The European Democracy Shield: An overview‘ in the Think Tank pages of the European Parliament.

Written by Clare Ferguson with Sara Raja.

The 28th regime is a proposed EU-level legal framework that would allow innovative companies to operate across the EU under a single set of rules. Companies would not have to deal with differing regulations across Member States, which would help boost the single market. On Monday, Parliament is set to debate a  legislative-initiative report on the 28th regime from the Committee on Legal Affairs (JURI). The report suggests national limited liability companies be able to register as ‘Societas Europaea Unificata’ (S.EU), which would be automatically recognised in all Member States. It recommends a harmonised EU legal framework for corporate law to align national rules across all Member States, while ensuring safeguards for national laws to avoid undermining labour and social laws. It proposes a common digital direct entry point allowing entrepreneurs to establish companies within 48 hours, and harmonised rules on employee financial participation schemes.

On Monday, Parliament is expected to debate a legislative-initiative report from the Committee on Employment and Social Affairs (EMPL) proposing a new directive to protect workers who may become unemployed in the move towards a greener and more digital society. The report calls on the European Commission to create a comprehensive framework to ensure EU countries create jobs in regions where jobs are most likely to disappear. This framework should ensure the development of viable economic alternatives and attract the necessary investment. The report also calls to set certain workplace conditions, including the right to training during working hours, health and safety measures, the right to worker consultation and collective bargaining and stronger protections against unfair dismissal. It also calls for increased support for a just transition in the 2028-2034 multiannual financial framework (MFF). Lastly, the proposed directive would require Member States to develop national strategies and business support programmes for small and medium-sized businesses.

Critical medicine shortages and the EU’s growing reliance on external suppliers for critical ingredients pose a threat to EU public health. The proposed ‘critical medicines act’ aims to improve the availability and security of supply of critical medicines in the EU by decreasing dependency on single suppliers and non-EU countries, such as India and China, and improving pharmaceutical manufacturing in the EU. On Monday, Members are scheduled to debate a report from the Committee on Public Health (SANT) regarding the proposed regulation, and set Parliament’s position for trilogue negotiations. The report expands the definition of a ‘strategic project’ to improve EU manufacturing capacity and calls for the creation of a critical medicines security fund within the 2028-2034 MFF and an EU coordination mechanism for national stockpiles and contingency stocks of critical medicines.

Proposed reform of EU air passenger rights to address issues such as delays, cancellations, weak enforcement and unclear rules had been stalled in the Council for over a decade due to disagreements on compensation, extraordinary circumstances and enforcement. Members are now scheduled to consider the reform on Tuesday with a debate on the recommendation from the Committee on Transport and Tourism (TRAN) on second reading. The report rejects the Council’s position in favour of higher delay thresholds and reduced compensation, and supports distance-based compensation of €300-€600, a closed list of exemptions, and stronger passenger protections, such as free hand luggage, bans on unfair fees and longer claim deadlines.

On Tuesday, Members are scheduled to consider the 2025 annual implementation reports on common security and defence policy from the Committee on Security and Defence (SEDE) and on common foreign and security policy from the Committee on Foreign Affairs (AFET). Both reports identify Russia’s war against Ukraine as a primary threat to the EU and Member States, and call for stronger support for Ukraine to protect European security. They both acknowledge the importance of EU relations with the United States in securing peace in Ukraine, with the SEDE report noting the risks of isolationist US foreign policy and expressing concern at the US government’s threats against Greenland’s sovereignty. The AFET report highlights the current global geopolitical instability and accelerated erosion of democratic norms, stating that the EU’s credibility depends on its ability to act coherently and decisively. It calls for a gradual transition to qualified majority voting for common foreign and security policy decisions without military or defence implications, while encouraging greater use of constructive abstention.

On Tuesday, Members are set to consider a resolution on the AFET committee’s annual report on human rights and democracy in the world. The report aims at informing a post-2027 EU action plan for human rights and democracy, and reiterates Parliament’s call for a stronger plan based on a full review of the current framework, with clear benchmarks, indicators and timelines. It highlights growing threats to human rights and the international system, proposes improvements to EU tools such as human rights dialogues, support for human rights defenders, conditionality in EU trade and international agreements and human rights sanctions. It also stresses the need for earmarked funding for human rights and democracy support in the next MFF, notably through the proposed Global Europe instrument.

The EU is facing a rising drone threat linked to Russian provocations and is boosting drone and counter-drone capabilities. On Thursday, Parliament is scheduled to debate an own-initiative report from the Committee on Security and Defence (SEDE) setting out a comprehensive strategy to prepare the EU for drone-enabled conflict, calling for the rapid integration of drone and counter-drone capabilities across EU defence planning and stronger protection of civilian infrastructure. It stresses the need to build a robust, autonomous European drone industry, reduce reliance on non-EU suppliers and shift from a primarily regulatory approach to a security model focused on operational capabilities and strategic autonomy.

Quick links to all our publications for this plenary session:

• Outcome of the European Council of 17-18 December 2015: Post-European Council Briefing
• The Parliament of Cyprus and EU affairs
• Priority dossiers under the Cyprus EU Council Presidency
• 40th anniversary of Spain’s EU accession
• 40th anniversary of Portugal’s EU accession
• The 28th regime: A new legal framework for innovative companies
• Just transition directive in the world of work: Creating jobs and revitalising local economies
• Proposal for a critical medicines act: Addressing shortages, building a more resilient supply chain
• Air passenger rights
• Implementation of the common security and defence policy – Annual report 2025
• Implementation of the common foreign and security policy – Annual report 2025
• Human rights and democracy in the world: Annual report 2025
• Drones and new systems of warfare: Adapting the EU to today’s security challenges

Written by Eszter Balázs.

INTRODUCTION

The country takes over from Denmark and will hand the baton on to Ireland. Cyprus is the last member of the presidency trio with Poland and Denmark.

State and government

The Republic of Cyprus is a presidential democracy. The president is the head of state and the head of government; there is no prime minister. This full presidential system is unique among the EU Member States.

According to the Constitution, executive power is exercised jointly by a Greek Cypriot President and a Turkish Cypriot Vice-President of the Republic, through a Council of Ministers appointed by them (seven and three ministers, respectively).

In 1963, the Turkish Cypriot Vice-President and the three Turkish Cypriot ministers withdrew from government, and since then the government has been functioning by necessity only with Greek Cypriots in all ministries, the number of which was subsequently raised to 11. Moreover, the President of the Republic, according to the provisions of the relevant national legislation, has appointed five Deputy Ministers. The post of Vice-President remains vacant.

The post of Deputy Minister for European Affairs has been created especially for the Presidency. It will cease after Cyprus’s term concludes.

The President convenes and sets the agenda of the Council of Ministers. In foreign affairs, defence and security, the President has veto powers over both the legislative branch and the Council of Ministers.

The current President of the Republic is Nikos Christodoulides, in office since 1 March 2023, following presidential elections in February 2023. His term of office, as is also that of the Council of Ministers, is five years, with the next presidential elections scheduled for February 2028. President Christodoulides is independent, supported by the nationalist-centrist Democratic Party (DIKO – S&D), the social-democratic Movement for Social Democracy – Citizes’ Alliance (EDEK – S&D), and the centrist Democratic Alignment (DIPA – Renew).

Read the complete briefing on ‘Priority dossiers under the Cyprus EU Council Presidency‘ in the Think Tank pages of the European Parliament.

Written by Sarah Sheil.

What are the challenges and issues that the European Union will have to take on in 2026? For ten years now, the European Parliamentary Research Service (EPRS) has asked its policy analysts to identify ten issues to watch in the year to come. While not exhaustive, the annual outlook produced by the Members’ Research Service seeks to explore some major political debates as well as put the spotlight on issues that are not so well known. Over a challenging and defining decade, the series has tackled themes across the European Parliament’s various fields of competence, from citizens’ policies and structural policies to the economy, digital and climate issues, to budget and international affairs.

Such periodic analysis enables us to better understand today’s opportunities and challenges. When reflecting on issues that have affected the European Union in the past decade, dramatic changes immediately come to mind: the COVID-19 pandemic, the war on Ukraine, and the shift in global power balances. But this annual exercise has also covered long-standing, recurrent issues: addressing climate change, shaping the long-term budget for Europe, monitoring the Union’s weight in global trade, and analysing the changing dynamics of the transatlantic relationship.

This tenth edition comes at a highly turbulent time in geopolitics. The balance of power in the world is shifting, and the rules-based international order now faces greater and more frequent challenges than ever before. The selection of issues for 2026 reflects this heightened focus on external policies. The publication addresses three directly affecting the EU: Ukraine’s integration into the EU, European defence capability gaps, and EU-China relations. These issues interact with other trends and developments with geopolitical consequences, such as the impact on the web of artificial intelligence (AI), the potential of Europe’s startup companies, the tougher stances on irregular migration being taken around the world, including in Europe, and challenges on climate policy and ocean protection – all covered below. All these issues, as well as the ‘normal business’ that is not highlighted in this paper but is the European Union’s daily work in delivering for its citizens, require financial means and governance. So this paper also covers the discussions on shaping Europe’s long-term budget, or multiannual financial framework, for the coming years, as well as lessons drawn from implementing the post-COVID-19 Recovery and Resilience Facility.

EPRS provides independent, objective and authoritative information to Members of the European Parliament. As with all EPRS publications, this paper is based on research, robust facts and figures, and informed analysis, with the aim of providing Members with the elements they need to do their work. Readers will find links to the previous editions of this publication listed under the ‘Further reading’ section. Analysis on countless other topics and issues requiring closer, more regular monitoring can be found in the thousands of publications that EPRS has issued over the years, enriching Parliament’s knowledge environment. We hope that this tenth edition of ‘Ten issues to watch’ will provide you with material for reflection as we enter 2026.

Read the complete in-depth analysis on ‘Ten issues to watch in 2026‘ in the Think Tank pages of the European Parliament.

© EPRS 2026

Written by Anna Flynn.

The European Parliament is fully committed to ensuring an ambitious European Union budget that meets the Union’s many challenges in the years to come. The European Commission presented its proposals for the 2028-2034 multiannual financial framework (MFF) on 16 July 2025. The Commission proposes a budget amounting to a total of almost €1.8 trillion in commitments over seven years (in constant 2025 prices). The MFF constitutes the EU’s long-term budgetary plan, setting a maximum level of spending (‘ceilings’) for each major category of expenditure (‘heading’) in accordance with Article 312 of the Treaty on the Functioning of the European Union (TFEU).

The proposed 2028-2034 budget corresponds to 1.26 % of the EU’s GNI. This includes 0.11 % of EU gross national income (GNI) for the repayment of the debt created by Next Generation EU (NGEU) grants. Excluding the NGEU repayment, the proposed post-2027 MFF reflects, in nominal terms, an increase of €367.2 billion (+29 %). However, in real terms, the increase is only 0.02 percentage points of GNI.

The national and regional partnership plans (NRPPs) proposed by the European Commission have proven particularly controversial throughout the European Parliament. They are seen as a risk of ‘renationalising’ the EU budget, as each Member State would agree their own plan with the Commission, within the constraints of allocated funding that is conditional on meeting EU priorities This raises questions about Parliament’s capacity for oversight and scrutiny. Moreover, the NRPPs merge many funds that were previously separate, such as the common agricultural policy, cohesion policy, and the common fisheries policy. Parliament’s four pro-European groups (S&D, Greens/EFA, Renew Europe, and the EPP) threatened to reject the Commission’s draft regulation on the NRPPs if it does not substantially amend its proposal.

On 9 November 2025, the Commission proposed some possible reforms to the NRPPs, such as the introduction of a 10 % spending target for agriculture, and a strengthened role for regional authorities in decision-making. However, these revisions do not address all of Parliament’s concerns. Parliament’s Committee on Budgets (BUDG) continues its work on the interim report on the MFF proposals, with opinions awaited from many of the standing committees before the BUDG report goes to plenary in May 2026.

An overview of the main components of the proposed 2028-2034 MFF and an initial comparison with the 2021-2027 budget framework illustrates the Commission’s proposed division of €1.763 trillion in commitments, which Parliament’s BUDG committee finds lacks ambition.

Academia, think tanks, other EU institutions and bodies, and a variety of stakeholders are publishing a wealth of analysis and commentary on the proposed 2028-2034 MFF as it proceeds through negotiations (see our monthly digest).

Links to EPRS publications:

• ERDF – Cohesion Fund and conditions for EU support to regional policy
• Background information on the post-2027 MFF – December 2025
• Regulation on the common agricultural policy for the period 2028 to 2034
• EU budget 2028-2034: Overview of the Commission’s proposal

Other links

• The European Parliament rejects the National and Regional Partnership Plans proposal as it stands and demands an amended proposal to start negotiations (30 October 2025)
• MEPS brand von der Leyen’s EU budget ‘re-nationalisation’ (9 September 2025)

Written by Yann-Sven Rittelmeyer.

Introduction to Cyprus’s parliamentary system

Cyprus is a presidential democracy with a President directly elected by universal suffrage in a secret ballot. The President is both Head of State and Head of Government as he or she appoints the ministers and exercises executive power together with them. The President is formally invested by the Parliament, but the executive, legislative, and judicial powers are strictly separated.

The President and ministers are scrutinised by the Parliament, but they are not accountable to it. Reciprocally, the executive cannot dissolve the Parliament; only an absolute majority of the Parliament can decide to do so (Article 67 of the Constitution). The President and ministers cannot be members of the Parliament.

Legislative power is exercised by the House of Representatives, the unicameral parliament of the Republic of Cyprus. It is elected by universal and secret suffrage every five years through a system of simple proportional representation in six electoral districts. Both the President and the members of parliament are elected for five-year terms but in different years. The President does not necessarily have the support of a parliamentary majority and can govern without it.

The Constitution sets the number of members of the House of Representatives at 50 (two thirds Greek Cypriots, and one third Turkish Cypriots), but this number may be altered by the House of Representatives. Since 1985, the number of seats has been set at 80, keeping the same proportions between the two communities (Law 124/85): 56 Members come from the Greek Cypriot community, and 24 seats are reserved for Members coming from the Turkish Cypriot community – currently vacant due to the de facto division of the island. In addition, the minority religious groups of Armenians, Maronites and Latins each elect a representative who can express views but not vote.

The main role of the House of Representatives is to examine and adopt legislation, including on the state’s budget. Both the executive and the Parliament can make legislative proposals, but in practice, most are proposed by the Council of Ministers. Furthermore, this right is constrained for the Parliament, as bills it proposes should not result in any increase in budgetary expenditure.

The House of Representatives has the right to amend the Constitution, with the exception of the articles determining its form of government, the separation of powers and the bicommunal character of the state.

Read the complete briefing on ‘The Parliament of Cyprus and EU affairs‘ in the Think Tank pages of the European Parliament.

Written by Anna Flynn.

The EU and China account for nearly 30 % of global trade. The EU has defined China as a ‘partner, competitor, and systemic rival.’

One of the key, current challenges is that, following the announcement of United States’ tariffs, China announced new export controls on their rare earth elements in April and October 2025. A second package was suspended until November 2026.

At the 25th EU-China Summit in Beijing, marking 50 years of diplomatic relations, the partners discussed trade, climate change, and Russia, against an ongoing backdrop of huge geopolitical shifts.

During the July 2025 summit, the EU urged China to lift its restrictions. China’s rare earth elements are difficult to source elsewhere, and simultaneously play an imperative role in the EU’s digital, defence, and green industries. According to the European Central Bank, 80 % of European firms are three intermediaries away from rare earth element producers; highlighting the value of these materials to the EU economy.

The EU’s plan to address this vulnerable, yet vital supply, is the Critical Raw Materials Act. The aim of this regulation (among other things) is to diversify the EU’s imports, support strategic projects, and strengthen EU monitoring of supply risks.

In July 2025, Parliament adopted a resolution urging the Commission to speed up the process of implementing the Critical Raw Materials Act, condemning China’s actions as unjustified and coercive.

Moreover, The EU’s trade deficit with China (€308.4 billion in 2024), is expected to rise.

Meanwhile, China’s relationship with Latin America and the Caribbean (LAC) is growing, in direct competition with the EU’s objective to diversify critical raw material sources. Latin America produces large amounts of lithium and copper. By 2030, the EU’s demand for lithium is expected to increase 12-fold. Chinese companies have purchased half of the world’s largest lithium mines, and China is Latin America’s second largest trading partner today.

Nevertheless, in a joint statement following the EU-China summit, both parties reiterated that major economies should bolster climate efforts. They agreed to cooperate and lead a green transition.  

A couple of months afterwards, ahead of COP30, China submitted its nationally determined contribution (NDC), or climate targets, for 2035. China’s share of global emissions increased from 9 % in 1990 to 17 % in 2024, and this is the first time that it has agreed to an absolute greenhouse gas emissions reduction.

An additional source of contention is China’s involvement with Russia’s ongoing war in Ukraine. At the summit, the EU stressed China’s responsibility to uphold world order and to refrain from supporting Russia’s military agenda. At the end of October 2025, the EU’s 19th package of sanctions was adopted against Russia, including sanctions on 12 entities located in China that are supporting Russia’s military and industrial complex.

This bilateral relationship will continue to carry far-reaching importance.

Links to EPRS publications

• China’s rare-earth export restrictions
• China’s 2035 climate pledge
• Economic Outlook Quarterly Final year of implementation for the recovery plans
• The third generation of national climate plans Analysis of major economies’ nationally determined contributions ahead of COP30
• China’s increasing presence in Latin America: Implications for the European Union
• EU-China relations

Housing is becoming an urgent issue in many European Union (EU) countries, as rents and property prices are currently increasing faster than inflation.

While housing is generally the responsibility of EU countries, the EU supports national and local authorities through partnerships and social housing funding programmes. At the same time, the European Parliament is urging broader EU action to promote decent and affordable housing for all.

Housing as a European Union priority

Ahead of her re-election, Commission President Ursula von der Leyen promised to make housing an EU priority, with a new Commissioner responsible for housing and a European affordable housing plan.

In its 2024-2029 political guidelines, the European Commission pledged to enable EU countries to double the investments in affordable housing planned under the EU’s cohesion policy, which aims to reduce differences between EU regions.

The EU funds housing projects in several ways, including by providing over €100 billion for energy-efficiency renovations up to 2030. EU financing comes from many sources, and is designed to complement other public funding at national or regional level.

The Commission is also collaborating with the European Investment Bank (EIB) to provide the financing and expertise needed to build more innovative, energy-efficient and affordable homes.

Additionally, the Commission and the EIB are working with the EU’s national promotional banks and international financial institutions to develop new financing opportunities for affordable and sustainable housing across Europe.

The European Parliament’s position

In two March 2025 resolutions on employment and social priorities and on the European Social Fund Plus (ESF+), Parliament stressed that the EU’s budget must align with social priorities like affordable housing, and called for more resources to support people in vulnerable situations.

Parliament called on the Commission and EU Member States to make it easier to build, convert and renovate accessible and energy-efficient housing that is affordable for people at risk of poverty and those wanting to buy a property.

It underlined that the ESF+ can be instrumental in this, and called for a stronger ESF+ in the next EU seven‑year budget (beyond 2027) to focus on homelessness and access to housing, including social housing and affordable rental schemes.

In September 2025, the European Parliament adopted a resolution on using cohesion funds to resolve the housing crisis. It asked the authorities managing EU funds to address housing challenges in all regions, especially remote areas and islands, by using the mid-term review of cohesion policy programmes as an opportunity to increase housing-related investments.

The Parliament’s resolution also suggested broadening the scope of several EU funds to include innovative approaches for affordable housing. It asked EU countries and regions to develop strategies on affordable and sustainable housing for middle and low-income households in urban and rural areas.

Special Parliamentary committee on housing in the EU

In December 2024, Parliament set up a special committee to propose practical ways for the EU to tackle housing issues.

The Special Committee on the Housing Crisis in the EU is investigating the root causes of the housing crisis through a series of hearings, and will report its findings at the end of its mandate in early 2026.

Keep sending your questions to the Citizens’ Enquiries Unit (Ask EP)! We will reply in the EU language in which you write to us.

Written by Györgyi Mácsai and Nadejda Kresnichka-Nikolchova, Members’ Research Service (EPRS) with Raffaele Ventura, GlobalStat, EUI.

This infographic provides insight into the economic performance of China compared with the European Union (EU) and examines the trade dynamics between them. In 2024, China’s Gross Domestic Product (GDP) growth rate was recorded at 5%, while the EU experienced a growth rate of 1.1%. Chinese inflation rates remain stable at 0.2%. The exchange rate of the renminbi-yuan continues to rise, reaching 7.8 units per euro in 2024. Trade in goods and services between the EU and China has remained relatively stable, with a slight increase from the previous year. The EU is China’s largest trade partner in goods, accounting for 12.7% of China’s total imports and exports. Conversely, China is the EU’s second-largest trade partner, representing 14.6% of the EU’s trade, while the United States ranks first at 17.3%.

Read this ‘infographic’ on ‘China: Economic indicators and trade with EU‘ in the Think Tank pages of the European Parliament.

EU imports of services from China (2024)

Written by Polona Car.

The Cybersecurity Act (CSA) came into force in 2019 as part of the EU’s efforts to build strong cybersecurity. Since its introduction, the EU cybersecurity regulatory framework has become more complex in response to the rise in cyber-attacks. New EU rules, as well as changes in the geopolitical context, have impacted the CSA, and the regulation is currently under review. Although stakeholders are aligned on most issues, significant differences remain, notably in addressing non-technical risks relating to the security of the information and communications technology (ICT) supply chain.

The Cybersecurity Act in short

Regulation (EU) 2019/881 (the CSA) formalised the role of the European Cybersecurity Agency (ENISA), giving it a permanent mandate, resources and tasks, including operational ones. It also established a voluntary EU cybersecurity certification framework (ECCF) for ICT products, services and processes. The ECCF aims to set up and maintain specific certification schemes, allowing companies operating in the EU to use the certificates recognised across all Member States. In January 2025, a targeted amendment to the CSA was adopted, to enable the future adoption of European certification schemes for ‘managed security services’ covering areas such as incident response, penetration testing, security audits and consultancy. The CSA requires an evaluation and review every five years. Postponed several times, this is now expected on 14 January 2026.

Evolving context

Since the CSA entered into force, cyber-attacks have been on the rise. This has prompted new EU cybersecurity laws to address the growing number and complexity of cyber threats. As a result, ENISA’s roles and responsibilities have expanded. For example, ENISA supports implementation of the Directive on measures for a high common level of cybersecurity across the Union (NIS2) by providing technical guidelines, facilitating information sharing, and enhancing coordination between Member States. Similarly, ENISA supports implementation and enforcement of the Cyber Resilience Act (CRA) by providing technical expertise, developing a single reporting platform for vulnerability and incident reporting, and supporting cybersecurity certification schemes.

As regards certification, implementation of the ECCF has been challenging. So far, only one EU certification scheme has been adopted – the European cybersecurity scheme on common criteria (EUCC), dedicated to certifying ICT products. All other schemes (cloud services – EUCS, 5G, digital identity wallets and managed security services) are still under development. Additionally, there are concerns whether the ECCF effectively addresses non-technical supply-chain cybersecurity risks such as geopolitical dependencies. Questions have also been raised about how voluntary certification frameworks will align with the CRA, which establishes a presumption of conformity (in Article 27) for products certified under a recognised European scheme such as the EUCC.

The proposal for a revised CSA therefore aims to address both ENISA’s growing responsibilities and ECCF implementation. During the consultation, the Commission also gathered views on ICT supply chain security challenges and the simplification of cybersecurity rules, such as how to streamline reporting obligations.

CSA review: Points of convergence among stakeholders

The replies to the call for evidence for the CSA review have shown broad agreement that the CSA should be revised on the following issues: (i) streamline cybersecurity measures; (ii) enhance cyber resilience; and (iii) simplify the EU regulatory landscape. The review is seen as an opportunity to reduce administrative burden and compliance costs. A significant convergence point is the need to harmonise definitions and reporting requirements across major EU acts – such as NIS2, CRA and the General Data Protection Regulation (GDPR) – and establish a single EU incident notification platform. Such a platform has now been put forward in the proposal for a ‘digital omnibus’ regulation.

There is consensus that ENISA’s mandate should be clarified and strengthened to reflect the agency’s growing operational responsibilities under new EU rules such as NIS2 and CRA. Stakeholders note that this expansion should be matched by adequate financial resources and staffing in order to ensure the agency’s effectiveness. The view is that ENISA should serve as a central technical coordinator, to promote consistency and harmonise implementation of EU cybersecurity laws across the Member States, thereby reducing regulatory divergence. This echoes the Council conclusions of December 2024 on a stronger EU Agency for Cybersecurity. Poland went as far as calling for a separate law for ENISA, to separate this item from potential controversy around the EUCS discussions.

Stakeholders widely acknowledge that the process for developing and adopting certification schemes is too slow and opaque. They highlight that a more agile, transparent and inclusive process with clearer timelines is urgently needed. Furthermore, stakeholders underline that certification schemes should be based on and align with international standards in order to ensure global interoperability, maximise acceptance, and reduce compliance costs for companies operating internationally. The prevailing view is that certification schemes should also be leveraged as a recognised means of demonstrating conformity or compliance with security requirements stemming from other major EU legislative acts, including NIS2, CRA and the AI Act.

Potential challenges

Disagreements revolve around the specific content and scope of certification schemes, particularly regarding sovereignty and the legal limits of ENISA’s influence. The most contentious point is the inclusion of sovereignty requirements in certification schemes such as the EUCS. This issue divides stakeholders into those advocating measures to protect European digital autonomy (e.g. both data localisation and corporate headquarters based in the EU) and those prioritising open markets and technical neutrality. Pro‑sovereignty advocates, and stakeholders supporting ‘cloud by Europe‘ models (i.e. entirely EU-based cloud service providers, not controlled by non-EU stakeholders), argue that these measures are crucial to protecting sensitive data and reinforcing EU strategic autonomy. By contrast, major tech companies, such as Microsoft, Amazon and Google, argue that non-technical criteria are subjective and do not improve cybersecurity outcomes, potentially restricting market access and innovation. At Member State level, too, positions are divided, with some countries expressing concern over sovereignty requirements, and others advocating in their favour.

On the nature of certification, the majority view is that it should remain mostly voluntary, to maintain flexibility and innovation. However, mandatory certification in critical sectors where high-security assurance is essential was also proposed. In addition, ENISA’s regulatory power has sparked debate. Some stakeholders, including Amazon, oppose granting ENISA the authority to issue binding opinions or regulatory guidance, arguing that its role should remain technical and advisory.

It remains to be seen to what extent the Commission will consider stakeholders’ views. The CSA review will also need to fit into the simplification of cybersecurity-related incident reporting obligations, which are part of the ‘digital omnibus’ proposal published on 19 November 2025.

Read this ‘At a Glance note’ on ‘Cybersecurity Act review: What to expect‘ in the Think Tank pages of the European Parliament.

Written by Anna Flynn.

Start-ups are important in boosting competitiveness, which is a key priority during the EU’s 2024-2029 legislative term.

So, the EU is taking steps to foster its strategic innovation agenda, both financially and through policy measures. Evidence shows that the EU is falling behind competitors here (especially the US and China) – notably in the sectors of AI, biotech, clean tech, and defence tech.

The need for reform was highlighted by two 2024 papers – the Letta and Draghi reports, which set out recommendations to strengthen the EU’s single market and competitiveness, respectively.

Building on these reports, in January 2025, the Commission adopted the competitiveness compass. The compass is an economic framework that outlines three ‘imperatives’ – closing the innovation gap, decarbonising the economy, and reducing foreign dependencies.

Following this, the Commission launched the start-up and scale-up strategy (SSS) in May 2025. The aim is to make Europe an attractive place to set up and grow innovative companies. The SSS is linked to other initiatives such as the savings and investments union, the single market strategy, and the union of skills. In addition, the SSS will also encompass a 28th regime, with a focus on supporting startups.

The 28th regime is a long-standing concept. It would be a separate initiative that creates a single set of rules for businesses in the EU. The objective is to simplify laws and mitigate the fact that there are varying national regulations that create barriers for companies. The Letta report states that this ‘would be a transformative step towards a more unified single market’. The 28th regime would replace national law where the EU has exclusive competence, and it would supplement national legislation in other cases. It would also address relevant laws such as insolvency, labour, and tax rules. The Commission has indicated that the legislative proposal for this is scheduled for the first quarter of 2026.

ERPS has identified four challenges relevant to the 28th regime; to help the European Parliament’s Committee on Legal Affairs (JURI) prepare a legislative-initiative report supporting the proposal’s development. The four issues are that:

• the European financing ecosystem has a low appetite for risk and cross-border investment;
• Member States and innovative European companies struggle to attract skilled, entrepreneurial workers;
• the high cost of failure and restructuring for innovative European companies;
• high geographical variation in legal frameworks and innovation across the EU.

EPRS studies have corroborated that a transnational, pro-innovation perspective would bring economic benefit to the EU: a coordinated approach at EU level, instead of Member States acting alone, could add 0.9 % (or, with a more ambitious integrated approach, 2.6 %) to GDP by 2035.

Amid Parliament’s preparatory work, during a plenary debate on 7 October 2025, some MEPs noted that the 28th regime could consolidate the single market, while others expressed reservations about the potential impact on national laws.

JURI’s legislative-initiative report is expected to be voted in plenary during the January 2026 session.

Links

• The 28th regime
• Savings and investments union: Overview and state of play
• Scaling up European innovation – What is the potential European added value of a 28th regime?
• Single market strategy
• Union of skills
• A competitive compass for the EU
• Cost of non-Europe in strategic innovation
• Deepening the single market in the light of the Letta and Draghi reports