European Parliamentary Research Service Blog

Written by Angelos delivorias (1st edition).

The second Markets in Financial Instruments Directive (MiFID II) and the Markets in Financial Instruments Regulation (MiFIR) are the principal texts regulating investment services and activities in the EU. Following an extensive consultation and in light of the recent developments in the context of the coronavirus pandemic, the European Commission proposed the establishment of an EU-wide consolidated tape for shares, bonds, exchange-traded funds (ETFs) and derivatives, as well as making targeted changes to market structure, so as to increase transparency and strengthen the competitiveness of EU financial markets. Consolidated tape is a high-speed electronic system that reports the latest price and volume data on sales of exchange-listed stock.

The files are currently under review by the co-legislators. Within the European Parliament, they have both been assigned to the Committee on Economic and Monetary Affairs. The draft reports are expected soon.

Version

• June 2022: Amendments to MiFID II and MiFIR: The EU’s markets in financial instruments (1st edition)

Proposal for a Directive of the European Parliament and of the Council amending Directive 2014/65/EU on markets in financial instruments
Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EU) No 600/2014 as regards enhancing market data transparency, removing obstacles to the emergence of a consolidated tape, optimising the trading obligations and prohibiting receiving payments for forwarding client orders Committee responsible:Economic and Monetary Affairs (ECON)COM(2021) 726 and
COM(2021) 727, 25.11.2021Rapporteur:Danuta Maria Hübner (EPP, Poland)2021/0384(COD) and 2021/0385(COD)Shadow rapporteurs:Eero Heinäluoma (S&D, Finland)
Nicola Beer (Renew Europe, Germany)
Karima Delli (Greens/EFA, France)
Gunnar Beck (ID, Germany)
Johan Van Overtveldt (ECR, Belgium)Ordinary legislative procedure (COD) (Parliament and Council on equal footing – formerly ‘co-decision’) Next steps expected: Publication of draft report © ekapolsira / Adobe Stock

Written by Marcin Grajewski.

Inflation has risen to levels not seen in 40 years in the euro area or in many other countries, forcing some central banks to raise interest rates in a context that bodes ill for economic growth. Initially driven by post-pandemic supply shortages and then by soaring energy prices, following Russia’s invasion of Ukraine, inflation is now becoming increasingly broadly based, affecting everything from food and services to household goods. Dissatisfaction with the rising cost of living is leading to social protests, increasing political risks for many countries. In the euro area, price growth was 8.1 % in May year-on-year, more than four times the European Central Bank’s target.

This note gathers links to the recent publications and commentaries from many international think tanks on resurgent inflation. Many earlier publications on inflation can be found in a previous edition of the ‘What Think Tanks are Thinking’ series.

The Fed has regained the initiative, but at a cost
Atlantic Council, June 2022

Fragmentation risk in the euro area: No easy way out for the European Central Bank
Bruegel, June 2022

5 key takeaways on inflation from the May CPI report
Brookings Institution, June 2022

Can child care and pre-K help reduce inflation?
Brookings Institution, June 2022

What if the Federal Reserve books losses because of its quantitative easing?
Brookings Institution, June 2022

Demand- and supply-side factors behind the higher inflation
Centre for Social and Economic Research, June 2022

The ECB’s normalisation path
Centre for European Policy Studies, June 2022

IfO Economic Forecast Summer 2022: Inflation, supply bottlenecks and war slow down economic recovery in Germany
IfO, June 2022

Weltwirtschaft im Sommer 2022: Inflationsschub bremst die Expansion
Kiel Institute, June 2022

Stagflation and fragmentation: The euro area at crossroads
LUISS School for European Political Economy, June 2022

How money printing destroyed Argentina and can destroy others
Mises Institute, June 2022

The Fed tries to get ahead of inflation
Peterson Institute for International Economics, June 2022

How free trade can fight inflation: More competition means lower prices
Peterson Institute for International Economics, Foreign Affairs, June 2022

To fight inflation, cutting tariffs on China is only the start
Peterson Institute for International Economics, June 2022

Measures to combat inflation and its effects
Austrian Institute of Economic Research, May 2022

Three headaches for the European Central Bank
Bruegel, May 2022

Inflation-related updates to ‘Recession Remedies’
Brookings Institution, May 2022

Wages, pensions and household income have risen in real terms over the past 25 years
DIW, May 2022

The Ukraine war and inflation
IfO, May 2022

We must not override the signal function of the price!
IfO, May 2022

Our economy needs a good dose of customer-driven deflation
Mises Institute, May 2022

Brexit is driving inflation higher in the UK than its European peers after identical supply shocks
Peterson Institute for International Economics May 2022

Impact of the war in Ukraine on the debate on the future of agriculture in the EU
Polish Institute of International Affairs, May 2022

Is a recession coming? A key indicator is also the king of mixed messages
Rand Corporation, May 2022

Le nouveau manuel politique de la zone euro
Terra Nova, May 2022

Rising cost of living and poverty
Austrian Institute of Economic Research, April 2022

Fiscal support and monetary vigilance: Economic policy implications of the Russia-Ukraine war for the European Union
Bruegel, April 2022

From low to high inflation: Implications for emerging market and developing economies
Centre for Economic Policy Research, April 2022

Rental inflation and stabilisation policies: international evidence and the Irish experience
Economic and Social Research Institute, April 2022

German economy slowed down by war, inflation and Chinese lockdowns
DIW, April 2022

Political shocks and inflation expectations: Evidence from the 2022 Russian invasion of Ukraine
IfO, April 2022

Comment se protéger au mieux de l’inflation ?
Institut Thomas More, April 2022

Economic prospects call for high inflation and slowing global growth
Peterson Institute for International Economics, April 2022

Die wirtschaftliche Entwicklung im Ausland: Krieg in der Ukraine belastet die Weltwirtschaft und bringt weiteren Inflationsschub
RWI, April 2022

Read this briefing on ‘The return of inflation‘ in the Think Tank pages of the European Parliament.

Written by Tambiama Madiega, Polona Car and Maria Niestadt with Louise Van de Pol.

One of the most talked about concepts in modern technology, the metaverse can be described as an immersive and constant virtual 3D world where people interact by means of an avatar to carry out a wide range of activities. Such activities can range from leisure and gaming to professional and commercial interactions, financial transactions or even health interventions such as surgery. While the exact scope and impact of the metaverse on society and on the economy is still unknown, it can already be seen that the metaverse will open up a range of opportunities but also a number of risks in a variety of policy areas.

Major tech companies are scaling up their metaverse activities, including through mergers and acquisitions. This has given impetus to a debate on how merger regulations and antitrust law should apply. Business in the metaverse is expected to be underpinned largely by cryptocurrencies and non-fungible tokens, raising issues of ownership, misuse, interoperability and portability. Furthermore, the huge volume of data used in the metaverse raises a number of data protection and cybersecurity issues (e.g. how to collect user consent or protect avatars against identity theft).

There is considerable scope for a wide range of illegal and harmful behaviours and practices in the metaverse environment. This makes it essential to consider how to attribute responsibility, inter alia, for fighting illegal and harmful practices and misleading advertising practices, and for protecting intellectual property rights. Moreover, digital immersion in the metaverse can have severe negative impacts on health, especially for vulnerable groups, such as minors, who may require special protection. Finally, the accessibility and inclusiveness of the metaverse remain areas where progress has still to be made in order to create an environment of equal opportunities.

Read the complete briefing on ‘Metaverse: Opportunities, risks and policy implications‘ in the Think Tank pages of the European Parliament.

Written by Clare Ferguson and Katarzyna Sochacka.

The highlight of the June II 2022 plenary session was the vote to overwhelmingly endorse the granting of candidate status to Ukraine and Moldova, and – once it meets the conditions set out by the Commission – Georgia. On the evening of 23 June, EU leaders did indeed follow suit. Members debated preparations for that European Council meeting taking place on 23-24 June 2022, including the meeting with Western Balkan leaders on 23 June. The Parliament also debated with the Commission and Council the use of national vetoes undermining the global tax deal, and held debates, inter alia, on implementation and delivery of the United Nations Sustainable Development Goals, and the future of EU international investment policy. Parliament adopted its position, following the urgent procedure, on exceptional temporary support under the European Agricultural Fund for Rural Development in response to the impact of Russia’s invasion of Ukraine. A ‘This is Europe’ debate was held with the Prime Minister of Croatia, Andrej Plenković. Finally, in a formal sitting, Members heard an address by Hakainde Hichilema, President of the Republic of Zambia.

Gas storage

Members debated an urgent proposal to boost gas storage in Europe, to reduce dependency on Russian gas. As Members endorsed the provisional agreement reached between the Parliament and Council, the measures should already take effect this summer. EU countries should fill 85 % of their storage sites by November 2022, with fair burden-sharing ensured according to national consumption levels, and joint purchases encouraged. While broadly in agreement with the Commission’s proposal to prepare for severing trade with Russian suppliers, Parliament’s negotiators were successful in adding provisions to take account of national variations, such as derogations for isolated gas markets in Ireland, Malta and Cyprus.

Fit for 55

The EU has committed to a 55 % cut in greenhouse gas emissions by 2030, and climate neutrality by 2050, with the proposals under the ‘fit for 55’ package aimed at turning this ambition into reality. Following Parliament’s rejection of the Committee on Environment, Public Health and Food Safety (ENVI) report on the Commission’s proposal to align the EU Emissions Trading System (ETS) with this target during the June I plenary session, Members adopted a set of amendments re-tabled by ENVI that include the amendments that were carried by the June I plenary, as well as other compromise amendments related to the linear reduction factor, the timing for phasing out free ETS allowances, and the corresponding phase-in of the carbon border adjustment mechanism (CBAM). Members also adopted their position on the revision of the CBAM to place a carbon price on certain imported products and phase out free emissions allowances for European industry. Because CBAM is tightly linked to the ETS file, it too was referred back to committee without a vote during the June I session. Members adopted the significant amendments to the original proposal included in the ENVI report. Members also completed the adoption of the Parliament’s position on the Social Climate Fund, intended to help those most affected by the green transition, following the vote on amendments in the June I session. The Parliament is thus ready to negotiate with the Council on all three files, along with the other fit for 55 package proposals adopted earlier in the month.

Recovery and Resilience Facility

Parliament’s role in scrutiny and oversight is key to ensuring that measures intended to support the post-pandemic recovery benefit EU citizens. Members debated and adopted a joint report of the Committees on Budgets and on Economic and Monetary Affairs on implementation of the Recovery and Resilience Facility (RRF). This report aims at providing Parliament’s input to the July review of RRF implementation. It highlights the RRF’s key role in the EU’s economic recovery, and in making the EU more resilient, competitive and strategically autonomous. The report notes that successful implementation is key to ensuring long-term impact and economic growth in the EU, pointing to the RRF’s stabilising effects to date. Urging Member States to provide the Commission with sufficient information to ensure effective reporting, the committees also stressed the importance of regular scrutiny and monitoring of RRF expenditure and compliance with the rule of law, where the report warns that reimbursement should be possible in case of non-compliance. Taking stock of EU countries’ use of the funding available to date, the report also highlights the RRF’s potential to boost EU prosperity and urges Member States to take advantage of the loans available.

Amending budget No 3 – Financing reception costs of people fleeing Ukraine

Members debated and adopted an amending budget to provide EU funding to finance the continued cost of welcoming refugees from Ukraine. It strengthens the financing of the Asylum, Migration and Integration Fund (AMIF) and the Border Management and Visa Instrument (BMVI). The additional €99.8 million in commitment appropriations and €76 million in payment appropriations for AMIF and €100 million in payment appropriations for BMVI will help to ensure that people fleeing Ukraine benefit from adequate initial reception conditions in Member States.

2021 Report on Montenegro

Continuing the annual assessment of progress by candidate countries, Members debated the Committee on Foreign Affairs (AFET) report on the Commission’s 2021 report on Montenegro’s EU accession negotiations. Despite recent political upheaval in the country, Parliament is keen to promote stability in its neighbourhood through the accession process. However, while the AFET report welcomes the new government, it also points out that Montenegro must continue to ensure a functioning parliamentary democracy and the necessary EU-related reforms. Any new candidates for EU membership will have to reach the same democratic and economic standards

Future of EU-Africa trade relations

Parliament adopted a resolution based on a Committee on International Trade (INTA) report that considers how to foster ethical and sustainable trade relations with African countries, in the light of the fast-changing global trade situation. The report calls for EU assistance to integrate the continent into the global economy through robust EU-Africa trade relations, as well as to help African countries to counter the effects of Covid‑19 and the war on Ukraine.

Accession to the Hague Convention

Members followed the Legal Affairs Committee recommendation and gave consent to the EU’s accession to the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters. By requiring its signatories to recognise and enforce judgments given in civil or commercial matters in other signatory countries, the convention is intended to reduce the difficulties experienced in making legal claims by businesses who trade across borders, and particularly for EU citizens and companies doing business in the USA.

Opening of trilogue negotiations

The Fisheries (PECH) Committee’s decision to enter into interinstitutional negotiations on the proposal for a regulation as regards specific measures to alleviate the consequences of the military aggression of Russia against Ukraine on fishing activities and to mitigate the effects of the market disruption was endorsed without a vote.

Read this ‘at a glance’ on ‘Plenary round-up – June II 2022‘ in the Think Tank pages of the European Parliament.

Written by Tarja Laaninen.

‘The war on Ukraine is also a war on information’, says Reporters Without Borders (RSF). On 16 June 2022, the Committee on Culture and Education (CULT), together with the Civil Liberties (LIBE) and Foreign Interference (INGE) committees, held an exchange of views on ‘Media freedom, protection of journalists and the fight against disinformation in the context of the war in Ukraine’. Speakers from journalists’ organisations, media professionals in exile and Commission representatives outlined their views on recent events in the light of their impacts on journalism and media freedom.

Four months since the brutal invasion of Ukraine began, Russian armed forces are deliberately targeting and killing journalists and bombing broadcasting equipment. ‘In 2022, 13 journalists in Europe alone lost their lives when on duty, 12 of them while reporting the war’, Renate Schröder from European Federation of Journalists (EFJ) told the audience. In parallel, Kremlin crackdowns mean that Russians have been left with no access to domestic sources of independent information covering the events in Ukraine. A recently-adopted law threatens anyone spreading ‘false information’ – which includes using the word ‘war’ – with up to 15 years in prison.

‘In the beginning of the war, we did not have equipment, we didn’t even find helmets; nobody was prepared for the war’, the panellists told the event. A good protective kit costs at least €1 000. With the help of UNESCO and various journalist organisations, safety equipment such as helmets and bulletproof vests, satellite phones, solar batteries and first aid kits were gathered and sent in. The most important thing, according to the experts, is to support continued journalism in Ukraine: to help local journalists so that they can keep on reporting on what is happening on the ground. ‘For this, money is needed’, said Oliver Money-Kirely from the International Press Institute (IPI): ‘The priority is to keep [the] Ukrainian media running, pay salaries, help displaced journalists’. The structure for solidarity is already in place on both the European and Ukrainian sides, he said, with bi-monthly meetings taking place. RSF has set up two Press Freedom Centres in Ukraine – in Lviv and Kyiv – to support journalists by distributing equipment, giving physical and online safety training and offering psychological support.

In the new emergency support programme for Ukraine, €15 million has been earmarked for measures to strengthen the media in Ukraine. Ukrainian journalists based in Ukraine or in the candidate countries to the EU can also benefit from support from the EU-funded Media Freedom Rapid Response project, which provides for grants of up to €5 000, and can cover needs such as medical assistance, subsistence, relocation costs and psychological support. The Journalists-in-Residence programme is already offering temporary shelter to a number of journalists in Leipzig and Milan.

In Russia, it is essential to help the few remaining independent journalists. For the journalists who have left the country, it is important to enable them to work from abroad: they need help with equipment, with setting up digital newsrooms, and with digital security and other ways of ensuring that information can still get into Russia. The hundreds of journalists in exile from Russia are in a precarious situation, many with very short residence permits – often only for six months, depending on the country – and their credit cards blocked. Nevertheless, many of them are determined to keep working to inform the Russian public. There are plans to create a community of journalists in exile from Russia who are in need of financial and technical help, and to set up offices for international cooperation in Paris, Riga and Amsterdam.

RSF has used ‘mirror site’ technology to unblock access to Meduza, the most popular Russian independent news website. With technical assistance from hackers, ICT specialists and engineers in several European countries, RSF is able to quickly create an exact copy or ‘mirror of a censored site and place it on content delivery networks that also host many other services and therefore cannot be easily blocked.

Soon after the Russian invasion of Ukraine, the EU adopted sanctions against state-owned outlets Russia Today and Sputnik. Their broadcasting in or directed at the EU is now suspended. With the recently adopted sixth package of sanctions, which comes into force on 25 June, the ban will extend to three more Russian media outlets. These are exceptional measures and target the core of the Kremlin disinformation and war propaganda machine in the EU. Some EU countries have also taken measures against additional Russian channels, which is possible under the Audiovisual Media Services Directive.

On disinformation, the Commission is in close dialogue with the signatories of the new Code of Practice on Disinformation, signed on 16 June, in order to receive weekly updates on how they are monitoring and limiting disinformation linked to the Russian invasion, for instance closing accounts and stepping up cooperation with fact-checkers. The European External Action Service’s EUvsDisinfo websites are continuing to expose disinformation – originating in pro-Kremlin media – that is spread across the EU and Eastern Partnership countries. On 21 June, the Council approved conclusions on the protection and safety of journalists and media professionals, pointing to a Council of Europe report that the number of alerts about serious threats to the safety of journalists and media freedom in Europe has almost doubled since 2016.

However, complex interactions between the media and audiences also pose challenges in the EU: a sobering report from the Reuters Institute for the Study of Journalism, published in June 2022, shows that a significant portion of the European population does not trust the media. There are big differences between countries: whereas in Finland, overall trust in traditional news is 69 %; in Germany, the figure is 50 %, in Poland 42 %, in Spain 32 % and in France only 29 %. Worryingly, a growing proportion of Europeans are avoiding the news altogether, for various reasons. In Denmark, 20 % of the people asked said they actively avoided the news, while in Sweden this was the case for 32 % of respondents, and in Romania 40 %. According to the report, selective news avoidance has also increased – most likely as a result of the difficult and depressing nature of the coverage.

Written by Carmen-Cristina Cîrlig with Romy Louisa Boden (1st edition).

The European Commission proposed a revision of Directive 2008/99/EC on the protection of the environment through criminal law in December 2021. The proposal intends to clarify some of the terms contained in the directive and includes an updated list of environmental crime offences, harmonised sanction types and levels, measures to strengthen international investigation and prosecution, improvements to the collection of statistical data and measures to improve national enforcement chains. Ultimately, the revision aims to increase the effectiveness of investigation and prosecution of environmental criminal offences across the European Union. Parliament’s Legal Affairs (JURI) Committee is the committee responsible for drawing up the draft report on the proposal.

Version

• June 2022: Revision of Directive 2008/99/EC: Protection of the environment through criminal law (1st edition)

Proposal for a directive of the European Parliament and of the Council on the protection of the environment through criminal law and replacing Directive 2008/99/EC Committee responsible:Legal Affairs (JURI)COM(2021) 851
15.12.2021Rapporteur:Antonius Manders (EPP, Netherlands)2021/0422(COD)Ordinary legislative procedure (COD) (Parliament and Council on equal footing – formerly ‘co-decision’) Next steps expected: Publication of draft report

Written by Ralf Drachenberg.

A series of sensitive topics feature on the agenda of the last regular European Council meeting before the summer break, taking place on 23-24 June. Considering the magnitude of the issues at stake, this European Council meeting – if successful – could become a milestone summit. Notably, EU leaders are expected to consider granting candidate country status to Ukraine and Moldova, most probably with certain specific conditions, to reaffirm the Western Balkans’ European perspective, and to consider the proposal put forward by the President of France, Emmanuel Macron, to create a European Political Community. They will also discuss developments in and support for Ukraine following Russia’s military aggression, as well as the broader consequences of the war, including food security. As at past meetings since the outbreak of the war, the President of Ukraine, Volodymyr Zelenskyy, may once again address the European Council. EU leaders could also consider the situation in the eastern Mediterranean, a topic they last discussed at the request of the President of Cyprus, Nikos Anastasiades, at the special European Council meeting of 30-31 May 2022. To what extent EU leaders will discuss the follow-up to the Conference on the Future of Europe remains uncertain.

1. European Council agenda points

Charles Michel is expected to use the opportunity of the 23-24 June European Council to update the indicative Leaders’ Agenda, setting a timetable for key issues to be discussed by the EU Heads of State or Government at upcoming meetings. The latest version expired in March 2022.

Following the opening address by the President of the Parliament, Roberta Metsola, the President of France, Emmanuel Macron, as leader of the country holding the six-month rotating presidency of the Council of Ministers, is expected to provide an overview of progress made in implementing previous European Council conclusions. An outstanding task for the European Council is the adoption of the new ‘strategic guidelines for legislative and operational planning’ within the area of freedom, security and justice, which were expected to be updated in the spring of 2020. More than two years later, and despite more than 20 European Council meetings in the meantime, EU leaders have yet to comply with this Treaty obligation (Article 68 TEU).

2. European Council meeting Wider Europe

As confirmed in the invitation letter from the President of the European Council, Charles Michel, EU leaders will ‘hold a strategic discussion on the European Union’s relations with its partners in Europe’ and consider the recent initiative by President Macron aimed at creating a European Political Community (EPC). In a non-paper circulated ahead of the meeting, France has outlined its vision of the EPC, which would be a body for political cooperation with democratic, non-EU European partners, including countries in the Western Balkans and the Eastern Partnership, as well as other like-minded partners. It would not substitute for the enlargement process, but instead could contribute to the ‘security, stability and prosperity of our continent’. President Michel has supported the initiative, underlining that the EPC’s aim is ‘not to replace the EU accession process’, but to grant ‘immediate political integration’ and facilitate regular political dialogue. The initiative initially drew criticism from Ukraine, which perceived it as an attempt to sidestep its EU membership application. During a visit to Kyiv on 16 June, the leaders of France, Emmanuel Macron, of Germany, Olaf Scholz, of Italy, Mario Draghi, and of Romania, Klaus Iohannis, expressed their support for granting ‘immediate’ candidate status to Ukraine. With this visit, they addressed Ukraine’s concerns, while paving the way to a more consensual debate on the EPC at the forthcoming European Council meeting.

Ukraine

EU leaders will discuss, for the fifth time since the start of the war, Russia’s military aggression against Ukraine. They will most probably call again on Russia to withdraw from Ukraine, reaffirm Ukraine’s legitimate right to defend itself, and condemn Russia’s war crimes as well as its breaching of international law and international humanitarian law. They might also reiterate their earlier call for the return of Ukrainians deported to Russia. In a recent resolution, the Lithuanian Parliament pointed to the 200 000 children ‘exiled’ to Russia, stressing the breach of international law and calling on ‘the UN and the EU to use the principle of universal jurisdiction to investigate and prosecute those involved in supervising the deportation of Ukrainians’.

Sanctions have been a recurrent topic on the European Council’s agenda since the outbreak of the war, with EU leaders green-lighting six packages so far. At the previous special European Council meeting on 30-31 May 2022, several EU leaders, including the Prime Minister of Estonia, Kaja Kallas, called on EU leaders to go beyond the current set of sanctions. A seventh package of sanctions was brought up for discussion by Poland during the Foreign Affairs Council on 20 June. EU leaders could also discuss sanctions at their meeting, and recall the importance of implementing them in close cooperation with like-minded partners.

EU leaders could discuss humanitarian aid, as well as further civilian and military assistance. The amount of military assistance agreed since the beginning of the war under the European Peace Facility (EPF) amounts to €2 billion, representing over a third of the envelope agreed for the EPF for the 2021-2027 period.  

Food security has become a recurrent item on the European Council agenda since the Versailles summit of 10-11 March 2022, being considered either as a stand-alone point or as part of the debate on the situation in Ukraine. Russia has been attacking silos, blocking Ukraine’s ability to export grain by sea, and even resorting to grain theft. To avoid shortages and a global food crisis, sustained efforts are being made to export Ukrainian grain, mainly through Romania and Poland, despite ‘bottlenecks’. Addressing the UN Security Council, President Michel stressed that ‘Russia is solely responsible for this food crisis’ and for ‘preventing Ukraine from planting and harvesting’. Turkey has shown readiness ‘to host a four-way meeting with the United Nations, Russia and Ukraine to organise the export of grain through the Black Sea’. At the Foreign Affairs Council on 20 June, the High Representative/Vice-President of the European Commission, Josep Borrell, spoke of the growing risk of famine in Africa as a direct consequence of Russia’s war on Ukraine. He underlined the EU’s support for ‘UN efforts to de-block the exports from Ukraine’, stressing once again that the food crisis is not the result of EU sanctions.

EU Membership applications of Ukraine, Moldova and Georgia

The European Council is expected to consider whether to grant candidate status to Ukraine, Moldova and Georgia. In its opinion presented on 17 June 2022, the European Commission recommended candidate status for Ukraine and Moldova, while stressing that Georgia ‘must first meet certain conditions before receiving candidate status’. For Ukraine and Moldova, the European Commission stressed that candidate status is granted on the assumption that the two countries stay the course on reforms, accelerate judicial reform efforts, continue and deliver on ‘the commitment to fight corruption’, and strengthen efforts to eliminate the oligarchs’ ‘influence of vested interests in economic, political, and public life’. Prior to being granted candidate status, Georgia would have, inter alia, to ‘adopt and implement a transparent and effective judicial reform strategy’ and work towards free and independent media.

It remains to be seen to what extent the European Council will follow the European Commission’s opinion, what specific conditions would be put in place, and for which countries, if not for all. The debate might be less heated than initially expected, following the positive outcome of the four leaders’ visit to Kyiv as well as the readiness of several Member States, including the Netherlands and Denmark, to support granting Ukraine candidate country status. If granted candidate country status, the three countries could access funds under the Instrument for Pre-Accession Assistance

Western Balkans

Following the EU–Western Balkans leaders’ meeting, which precedes the European Council on the morning of 23 June, EU leaders are likely to discuss the outcome of the meeting and reaffirm the region’s ‘unequivocal EU membership’ perspective. In this context, EU leaders might recall the principles and methodology governing the enlargement process, and call on countries from the region to work towards solving their outstanding disputes. The Western Balkans are a key priority for the EU, which is aware of the fragile regional situation and of Russia’s disinformation there. Visiting the region, President Michel stressed that the Western Balkans are a ‘strategic priority’ for the EU, that the EU–Western Balkans leaders’ meetings will help to strengthen ‘political cooperation and coordination’, and that ‘launching accession negotiations with both North Macedonia and Albania as soon as possible is a top priority’ for the Union.

Conference on the Future of Europe

EU leaders are supposed to discuss the follow-up to the Conference on the Future of Europe (CoFoE), and examine whether their views align with the CoFoE proposals. EPRS research (see ‘The Conference on the Future of Europe and the European Council‘) has shown that there is significant convergence between the results of the CoFoE and the priorities of the European Council as expressed in its strategic agenda for 2019-2024 and in its conclusions over the last three years.

Although the French Minister for European Affairs, Clément Beaune, representing the rotating Council Presidency, expressed his hope of prioritising the follow-up of the CoFoE at this European Council meeting, it is currently not certain whether an extensive discussion will take place on this topic.

The European Parliament has clearly signalled its preferences as to how to follow up on the results of the CoFoE. On 9 June, it adopted a resolution in which it argued that the Treaties need to be amended to make the EU better prepared for future crises, and called for a Convention to be convened for that purpose.

While Parliament’s position is clear, a joint Council position still needs to be established, with initial discussions at the General Affairs Council meeting of 21 June not progressing to that stage. Currently, Member States hold different positions. While 13 Member States have expressed their opposition to Treaty change, six other Member States have indicated that they ‘remain in principle open to necessary Treaty changes that are jointly defined’, emphasising the need for ‘an inter-institutional process to coordinate consensus-building in the Council, European Parliament and the Commission’.

EU leaders, such as French President Emmanuel Macron, German Chancellor Olaf Scholz, Italian Prime Minister Mario Draghi and Irish Taoiseach (Prime Minister) Micheál Martin – the latter two in their speeches as part of Parliament’s ‘This is Europe’ series of debates – have already expressed their support for Treaty change, if necessary. Consequently, it is still open whether EU Heads of States or Government will solely reiterate that ‘an effective follow-up to this report is to be ensured by the institutions, each within their own sphere of competences and in accordance with the Treaties’, or if they will go further.

On 17 June, Vice-Presidents of the European Commission Dubravka Šuica, Věra Jourova and Maroš Šefcovic presented the Commission’s communication on the Conference on the Future of Europe. The Commission’s position is that the follow-up is a shared responsibility of the EU institutions, according to their institutional remit and in respect of the principles of subsidiarity and proportionality.

To follow up on the proposals of the CoFoE, the Commission sets out four categories of responses: i) existing initiatives that address the proposals; ii) those which the European Parliament and the Council are called upon to adopt; iii) planned actions which will deliver on the ideas, building in new reflections from the Conference; and iv) new initiatives or areas of work inspired by the proposals, falling within the remit of the Commission. To keep citizens informed and to keep up the momentum, a Conference feedback event will be organised in autumn 2022.

Considering the proposal to hold a Convention, the Commission stressed that it ‘stands ready to fully play its institutional role in the procedure set out in Article 48 of the Treaty on European Union, and in particular to give its opinion in response to a consultation by the European Council’.

Economic issues

EU Heads of State or Government are expected to endorse the 2022 country-specific recommendations (CSR), which set the goals for Member States’ fiscal and economic policies, outlining necessary structural reforms, thus concluding the policy-guidance phase of the European Semester.

EU leaders will welcome the fulfilment by Croatia of all the convergence criteria as set out in the Treaty and endorse the European Commission’s positive recommendation on Croatia joining the euro area on 1 January 2023. The Eurogroup has already endorsed the Commission’s recommendation, on 17 June 2022, and the European Council will most likely call on the Council to adopt swiftly the relevant Commission proposals.

3. Euro Summit

On 24 June, EU leaders will convene for a Euro Summit meeting in inclusive format, in order to review progress on completing banking union and the capital markets union. As the March 2022 Euro Summit meeting was cancelled due to lack of time, EU Heads of State or Government will discuss these issues together for the first time since December 2021.

EU leaders will consider the results of the meeting of the Eurogroup on 16 June, which saw progress on banking union but failed to agree on the Commission’s 2015 proposal for a European deposit insurance scheme (EDIS). EU leaders will most likely reiterate the need for further progress to be made in these areas.

Read this briefing on ‘Outlook for the meetings of EU leaders on 23-24 June 2022‘ in the Think Tank pages of the European Parliament.

Written by Suzana Anghel.

On 23 June 2022, for the first time since the start of Russia’s war on Ukraine, the Heads of State or Government of the EU and of the six Western Balkan countries will meet for a leaders’ meeting in Brussels. The discussion will focus on enlargement, energy, security and defence, and youth. Discussion of Emmanuel Macron’s ‘European Political Community’ proposal is not on the agenda, but it could come up during the debate.

Background

On 18 May 2022, the President of the European Council, Charles Michel, announced the holding of a meeting of EU and Western Balkan leaders, with the aim of promoting ‘enhanced EU–Western Balkans engagement’. The meeting, to be organised in cooperation with the current French Presidency of the Council of the European Union, will focus on enlargement, energy, security and defence, and youth. It will take place in Brussels, on the morning preceding the European Council meeting of 23-24 June 2022. Back in December 2021, when presenting the priorities of the French Presidency of the Council, French President Emmanuel Macron indicated that a conference on the Western Balkans would be organised in June 2022. He also stressed that the Western Balkans were at the ‘heart of Europe’. He pointed to the then already tense regional situation, underlined the Union’s responsibility – urging it to re-engage with and invest in the Western Balkans – and called for support in countering disinformation. The President of the European Parliament, Roberta Metsola, may also attend the leaders’ meeting.

International and regional context

Russia’s war on Ukraine has reshaped Europe’s security architecture. Analysts warn of possible ‘aftershocks in the Balkans’, stressing that more must be done to counter disinformation originating in Russia, and to boost ‘energy diversification and infrastructure’, so as to reduce the region’s dependence on Russia and China. The five Western Balkan countries that are members of the United Nations – Albania, Bosnia and Herzegovina, Montenegro, North Macedonia and Serbia – voted in favour of the United Nations General Assembly resolution condemning Russia’s aggression against Ukraine. Unity in condemning the aggression did not, however, translate into unity in setting up and implementing sanctions on Russia. Only Albania, Kosovo*, Montenegro and North Macedonia have so far joined the EU in imposing sanctions on Russia. The three countries in the region that are members of NATO – Albania, North Macedonia and Montenegro – have provided Ukraine with military equipment and assistance. In contrast, Bosnia and Herzegovina and Serbia have refused to impose sanctions on Russia, with Serbia even prolonging its gas contract, although they have maintained EU accession as a priority for their countries.

The meeting format and venue

The EU leaders and the leaders of the six Western Balkan countries will meet in Brussels for a leaders’ meeting as opposed to a regular EU–Western Balkans summit. The main difference between the two types of meeting lies in the role played by the rotating Presidency of the Council of the EU. At past EU–Western Balkans summits, the rotating Bulgarian, Croat and Slovenian Presidencies played central roles in preparing the meetings, considering it the pinnacle of their respective presidencies. The forthcoming EU–Western Balkans leaders’ meeting takes place during the French Presidency of the Council, but does not represent its core event, which was the Versailles Summit of 10-11 March 2022. The choice of venue – Brussels – is yet another confirmation of the less prominent role of the rotating presidency in the meeting; thus, Charles Michel and his team will have the upper hand in managing the proceedings.

The main agenda points

The topics on the agenda – energy, security and defence, and youth – are not new. They belong to the key priorities discussed at past EU–Western Balkans summits and/or outlined in the declarations adopted by the EU leaders, ‘in consultation with Western Balkans leaders’, in Sofia (2018), Zagreb (2020) and Brdo (2021).

Energy is by far the most challenging topic in the context of Russia’s war on Ukraine, and high dependency on Russian fossil fuels. At Versailles, EU leaders decided to phase out the Union’s dependence on Russian fossil fuels. They reached out to the Western Balkan countries, with a call ‘to enhance connectivity with our immediate neighbourhood’ and, at subsequent meetings, agreed on a voluntary joint procurement mechanism for gas, liquefied natural gas and hydrogen, open to the region. On security and defence, cooperation is multifaceted, covering areas ranging from Western Balkan countries contributions to EU missions and operations, to security sector reform and intelligence cooperation. With respect to youth, leaders may take stock of progress made in the implementation of the ‘innovation agenda for the Western Balkans’ launched in Brdo. Youth policies are key to stabilising the region and reversing existing trends that make the Western Balkans a ‘net emigration’ region.

State of play on enlargement

Progress is lacking on enlargement, despite the revised methodology from 2020, which allows countries to ‘phase in’ to EU programmes. Montenegro and Serbia are the frontrunners, although the pace remains rather slow. Furthermore, Serbia’s proximity to Russia and reluctance to advance in resolving its dispute with Kosovo could result in an even slower pace. Solving neighbourly disputes remains one of the main criteria for EU accession. German Chancellor Olaf Scholz has underlined that, ‘when a brutal war is being waged in our immediate neighbourhood, it is of central importance that both countries (Serbia and Kosovo) gradually resolve their conflict’. Two other countries – Albania and North Macedonia – are waiting for accession negotiations to begin. Despite several calls, including from Germany, to solve the outstanding  dispute, Bulgaria is still blocking the opening of accession negotiations with North Macedonia; with an indirect impact on Albania. The remaining two countries – Bosnia and Herzegovina and Kosovo – are lagging behind owing to the absence of reforms and, in the case of the former, political instability, which a newly brokered political agreement could, if implemented in full, help overcome.

Past declarations were rather similar in content and messages – focusing inter alia on counter-terrorism cooperation, illegal migration and the European perspective of the Western Balkans – and were frequently addressed by the European Council in connection with the region. The word ‘enlargement’ appears only in the Brdo Declaration, where EU leaders underlined that ‘fair and rigorous conditionality and the principle of own merits’ should apply, inviting countries from the region to stay on course with their reforms. In a direct attempt to counter mounting disinformation, the Brdo Declaration stated that the EU is ‘the region’s closest partner, main investor and principal donor’.

European political community initiative

On 9 May 2022, President Macron invited the EU and like-minded non-EU countries in Europe to consider forming a ‘European political community‘ (EPC), to ‘complement’ but not substitute for the enlargement process. The proposal is expected to be debated during the forthcoming European Council meeting under the agenda point ‘wider Europe’. The EPC proposal has raised criticism from Ukraine, which initially saw it as an attempt to sideline its application for EU membership. The proposal has received mixed reactions in countries in the Western Balkans, with some, including North Macedonia, viewing it as ‘an excellent opportunity to unite countries that failed or did not want to join the bloc at a given moment, given the new geopolitical situation’. Touring the region ahead of the EU–Western Balkans leaders’ meeting, Charles Michel stressed that the aim was ‘not to replace the EU accession process’ but to grant ‘immediate political integration’ and allow regular political dialogue among leaders’, and hence stimulate progress on EU integration and accession.

European Parliament position

In an exceptional development, Parliament’s political group leaders adopted a joint statement ahead of the 23-24 June European Council meeting, expressing support for the Western Balkans on their EU integration path, and calling on the EU leaders to ‘maintain’ the Union’s ‘long-standing commitment’ to the region.

Read this at a glance note on ‘EU – Western Balkans leaders’ meeting of 23 June 2022‘ in the Think Tank pages of the European Parliament.

Written by Jakub Przetacznik with Simona Tarpova.

Russia launched its war on Ukraine on 24 February 2022, but Russian cyber-attacks against Ukraine have persisted ever since Russia’s illegal annexation of Crimea in 2014, intensifying just before the 2022 invasion. Over this period, Ukraine’s public, energy, media, financial, business and non-profit sectors have suffered the most. Since 24 February, limited Russian cyber-attacks have undermined the distribution of medicines, food and relief supplies. Their impact has ranged from preventing access to basic services to data theft and disinformation, including through deep fake technology. Other malicious cyber-activity involves sending of phishing emails, distributed denial-of-service attacks, and use of data-wiper malware, backdoors, surveillance software and information stealers.

Organisations and governments around the world have not been indifferent to the hybrid risks thus posed. EU-, US- and NATO-led initiatives have been carried out with the aim of neutralising cyber-threats and protecting essential infrastructure. As part of these initiatives, the EU has activated its Cyber Rapid Response Teams (a project under Permanent Structured Cooperation (PESCO) in the area of security and defence policy), to support Ukraine’s cyber-defence. Non-government and private players have supported Ukraine through various cyber-resilience activities. Since the beginning of the invasion, a significant number of counter-attacks have been launched by independent hackers, affecting the Russian state, security, banking and media systems.

The European Parliament has called for stepping up cybersecurity assistance to Ukraine and for making full use of the EU’s cyber-sanctions regimes against individuals, entities and bodies responsible for or involved in the various cyber-attacks targeting Ukraine.

Read the complete briefing on ‘Russia’s war on Ukraine: Timeline of cyber-attacks‘ in the Think Tank pages of the European Parliament.

Timeline of cyber-attacks on Ukraine

Written by Tambiama Madiega with Anne Louise Van De Pol.

The artificial intelligence act envisages setting up coordinated AI ‘regulatory sandboxes’ to foster innovation in artificial intelligence (AI) across the EU. A regulatory sandbox is a tool allowing businesses to explore and experiment with new and innovative products, services or businesses under a regulator’s supervision. It provides innovators with incentives to test their innovations in a controlled environment, allows regulators to better understand the technology, and fosters consumer choice in the long run. However, regulatory sandboxes also come with a risk of being misused or abused, and need the appropriate legal framework to succeed.

In April 2021, the European Commission presented a proposal for a regulation laying down harmonised rules on AI (the ‘artificial intelligence act’ or ‘AI act’). Academics and stakeholders have commented on the proposal, touching, in particular, on issues regarding the lack of liability protection for sandbox participants, the need for a more harmonised approach to AI regulatory sandboxes, and the interplay between AI sandbox and EU data protection rules.

The European Parliament has called for introducing regulatory sandbox instruments in several resolutions. Its April 2022 committee draft report on the AI act argued for more transparency on the implementation and use of AI sandboxes.

Read the complete briefing on ‘Artificial intelligence act and regulatory sandboxes‘ in the Think Tank pages of the European Parliament.

Written by Clare Ferguson.

There is something of a global dimension to the agenda for this second session of the month, with Hakainde Hichilema, President of Zambia, due to address a formal sitting on Thursday. Members will, the previous day, debate the preparation of the 23‑24 June 2022 European Council meeting, which will be preceded by the 23 June meeting between EU and Western Balkans leaders. They will also debate Council and Commission statements on EU candidate status for Ukraine, Moldova and Georgia. This follows the Commission’s recommendation last Friday to grant candidate status to the first two, and – following a number of priorities being addressed – subsequently to Georgia too. The question of candidate status will also be on the agenda of the European Council this week. As regards existing candidate countries, on Wednesday evening, Members are set to debate the  Committee on Foreign Affairs (AFET) report on the Commission’s 2021 report on Montenegro’s EU accession negotiations. Despite recent political upheaval in the country, Parliament is keen to promote stability in its neighbourhood through the accession process. However, while the AFET report welcomes the new government, it also points out that Montenegro must continue to ensure a functioning parliamentary democracy and the necessary EU-related reforms. Any new candidates for EU membership will have to reach the same democratic and economic standards. A debate is also scheduled on Wednesday evening on a Budget Committee report on an amending budget to provide EU funding to finance the continued cost of welcoming refugees from Ukraine. The latest ‘This is Europe’ debate will take place on Wednesday afternoon, with a familiar face to Parliament – the Prime Minister of Croatia, Andrej Plenković.

Looking further afield on Wednesday, Parliament is expected to consider a Committee on International Trade (INTA) report that considers how to foster ethical and sustainable trade relations with African countries, in the light of the fast-changing global trade situation. The report calls for EU assistance to integrate the continent into the global economy through robust EU-Africa trade relations, as well as to help African countries to counter the effects of Covid‑19 and the war on Ukraine. The report considers that a full commitment to the EU-AU ‘Joint Vision for 2030’ is key to achieving the UN Sustainable Development Goals – the implementation and delivery of which are also a topic slated for debate on Wednesday evening.

Several files linked to the Russian war on Ukraine and the post-pandemic recovery also feature on the agenda. On Thursday morning, Members will turn to an urgent proposal to boost gas storage in Europe, to reduce dependency on Russian gas. Should Members endorse the provisional agreement reached between Parliament and Council, the measures should already take effect this summer. This means that EU countries should fill 85 % of their storage sites by November 2022, with fair burden-sharing ensured according to national consumption levels, and joint purchases encouraged. While broadly in agreement with the Commission’s proposal to prepare for severing trade with Russian suppliers, Parliament’s negotiators were successful in adding provisions to take account of national variations, such as derogations for isolated gas markets in Ireland, Malta and Cyprus.

The EU has committed to a 55 % cut in greenhouse gas emissions by 2030, and climate neutrality by 2050, with the proposals under the ‘fit for 55’ package aimed at turning this ambition into reality. Following Parliament’s rejection of the Committee on Environment, Public Health and Food Safety (ENVI) report on the Commission’s proposal to align the EU Emissions Trading System (ETS) with this target during the June I plenary session, the file returns swiftly to the agenda for a vote on Wednesday afternoon. Members will consider a set of amendments re-tabled by ENVI that include the amendments that were carried by the June I plenary, as well as other compromise amendments related to the linear reduction factor, the timing for phasing out free ETS allowances, and the corresponding phase-in of the carbon border adjustment mechanism (CBAM). Because the ENVI report on the revision of the CBAM to place a carbon price on certain imported products and phase out free emissions allowances for European industry is tightly linked to the ETS file, it too was referred back to committee without a vote during the June I session. The report, which proposes significant amendments to the original proposal, will therefore also return to the agenda on Wednesday afternoon. The final vote, following the vote on amendments in June I, on the Social Climate Fund, intended to help those most affected by the green transition, is also due to take place.

Parliament’s role in scrutiny and oversight is key to ensuring that measures intended to support the post-pandemic recovery benefit EU citizens. On Wednesday afternoon, a debate is planned on a Committee on Budgets and Economic and Monetary Affairs Committee joint report on implementation of the Recovery and Resilience Facility (RRF). This report aims at providing Parliament’s input to the July review of RRF implementation. It highlights the RRF’s key role in the EU’s economic recovery, and in making the EU more resilient, competitive and strategically autonomous. The report notes that successful implementation is key to ensuring long-term impact and economic growth in the EU, pointing to the RRF’s stabilising effects to date. Urging Member States to provide the Commission with sufficient information to ensure effective reporting, the committees also stress the importance of regular scrutiny and monitoring of RRF expenditure and compliance with the rule of law, where the report warns that reimbursement should be possible in case of non-compliance. Taking stock of EU countries’ use of the funding available to date, the report also highlights the RRF’s potential to boost EU prosperity and urges Member States to take advantage of the loans available.

Finally, a Legal Affairs Committee report which recommends that the Parliament give consent to the EU’s accession to the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters will be voted on Thursday. By requiring its signatories to recognise and enforce judgments given in civil or commercial matters in other signatory countries, the convention is intended to reduce the difficulties experienced in making legal claims by businesses who trade across borders, and particularly for EU citizens and companies doing business in the USA.

Written by Katrien Luyten with Alessia Rossi.

In 1987, the United Nations General Assembly decided that every year 26 June should mark International Day against Drug Abuse and Illicit Trafficking. The idea was to demonstrate its commitment to the fight against drug abuse, illicit production and trafficking, and their nefarious effects on individuals and on society as whole. The illicit drug market generates huge profits for organised crime, and is estimated to be the source of approximately one fifth of global crime proceeds.

Background

The illicit drug market has long been the largest criminal market in the EU, reaching an estimated minimum retail value of €30 billion a year. Illicit drugs are also the preferred market for organised crime groups, eager to accumulate wealth by whatever means necessary. Their use of violence has intensified in recent years as they seek to intimidate other drug suppliers identified as rivals.

Europe is globally considered an important market for drugs, both in terms of domestic production and as a transit point or trafficking destination from other countries around the world. South America, west Asia, and North Africa are major drug-trafficking corridors into Europe. Cannabis and synthetic pharmaceuticals are also produced increasingly within Europe. According to the 2022 European Drug Report issued by the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA), cannabis is the illicit drug most used in the EU (used by 78.6 million adults) – followed by cocaine (14.4 million), MDMA (10.6 million) and amphetamines (8.9 million). The same report estimates that around 83.4 million or 29 % of adults (aged 15 to 64) have used illicit drugs at least once. According to estimates provided in the report, at least 5 800 people died of an overdose involving illicit drugs in the EU in 2020, up 12 % from 2019. Although overdose deaths increased in nearly all age categories, the highest increase (82 %) was among the 50-plus age group. Opioids, mainly heroin or its metabolites, often in combination with other substances, were found in 74 % of all fatal overdoses; furthermore, of all those entering drug treatment in Europe in 2020, 28 % did so with opioids as their primary drug.

Criminal groups not only adapt their supply to society’s demand but are also flexible in adapting and capitalising on changes in the environment in which they operate, creating additional challenges for law enforcement. In this regard, innovation in drug production, trafficking methods, and the related use of anonymised services for secure communications are a fertile breeding ground for the establishment of new trafficking routes and the growth of online markets, on both the surface web and the darknet. Drug sales using social media and instant messaging apps are attractive to potential customers and may be on the increase, as these technologies are perceived as a safer, more convenient and more accessible source of supply. These new methods were refined during the Covid-19 crisis, against which this market has been extremely resilient.

According to the EMCDDA report, levels of drug availability and use increased across the EU in 2021 compared with 2020, with some variations depending on the substance and the Member State. This points to a return to the pre-pandemic drug situation. In addition, the drug market can be influenced by significant international developments. Geopolitical tensions, determining the attractiveness of a specific border region or sector for criminals, are considered an opportunity for organised crime groups. In this regard, the humanitarian crisis in Afghanistan and the war in Ukraine may also have an impact in the medium and long terms on the kinds of drug problems facing the European Union.

EU action against drug abuse and illicit trafficking

The drug market not only inflicts substantial harm on millions of people, it also infiltrates and undermines public institutions, health and safety, the environment and labour productivity. For all these reasons and many others, the EU has been active in pursuing strategic and operational measures since the 1985 Schengen Agreement and 1990 Schengen Convention. Member States have been increasingly reliant on cross-border and EU cooperation to support their law enforcement authorities on the ground and to counter transnational drug operations. The constant goal is to reduce drug supply and demand by working closely with all partners at national and international level, EU institutions, bodies and agencies, as well as civil society organisations. Justice and home affairs EU agencies, such as the EMCDDA, Europol and Eurojust, play a central role in the drugs field, in the EU and internationally.

It is worth mentioning that the Council of the EU recently adopted a general approach on the new mandate of the European Drugs Agency, which aims to transform the current EMCDDA into a fully fledged agency and to respond more effectively to the new health and safety challenges posed by illicit drugs. Once adopted by the co-legislators, the Commission proposal put forward in January 2022, will enable the Agency, amongst other things, to issue alerts for particularly dangerous substances put on the market; to set up a network of forensic and toxicological laboratories; to carry out awareness and prevention campaigns at EU level; develop research in a more systematic way on drug markets and drug supply, and also support the EU policy against drug trafficking and drug consumption at international level.

Through the EU drugs strategy, the EU coordinates evidence-based, balanced and integrated measures with EU countries, and speaks with one voice internationally. In 2020, the Council of the EU approved the EU’s 2021-2025 drugs strategy, which builds on input from the Commission communication on an EU agenda and action plan on drugs for 2021 to 2025 – adopted in July 2020 as part of the new 2020-2025 security union strategy. The strategy aims to ensure a high level of health protection, social stability and security, while also contributing to awareness-raising. Moreover, it places EU responses to organised crime and drugs problems at the centre of the EU policy agenda – also dovetailing with the applicable goals of the UN’s 2030 Sustainable Development Agenda.

Law enforcement action against drug trafficking is coordinated through EMPACT (the European Multidisciplinary Platform Against Criminal Threats). This is a security initiative, driven by EU Member States, to identify, prioritise and address threats posed by organised and serious international crime and has become a permanent instrument, as set out in the Council conclusions on the permanent continuation of the EU policy cycle for organised and serious international crime: EMPACT 2022+.

Relatively few EU legislative acts have been adopted in this area. Along with the Council implementing decisions to ban new psychoactive substances, these include:

• Directive (EU) 2017/2103 on adding new psychoactive substances to the definition of ‘drug’, amending Council Framework Decision 2004/757/JHA and repealing Council Decision 2005/387/JHA;
• Regulation (EU) 2017/2101 amending Regulation (EC) No 1920/2006 on information exchange on, and an early warning system and risk assessment procedure for, new psychoactive substances; and
• Commission Delegated Regulation (EU) 2020/1737 amending Regulation (EC) No 273/2004 and Regulation (EC) No 111/2005 as regards the inclusion of certain drug precursors in the list of scheduled substances.

European Parliament

Parliament has been very active in addressing the problem of illicit drug control across the entire EU for many years. Already back in 1986, Parliament adopted a resolution calling on the Council to address the drug problem at ‘all levels from production and supply to demand and consumption’. In its 2020 resolution on the EU security union strategy, Parliament called for increased focus on rehabilitation and prevention in the EU action plan, not least through awareness-raising campaigns dedicated especially to children and young people. Parliament once again stressed that attention should be paid to both drug production and consumption and called for the extension of the EMCDDA’s mandate to cover multiple addictions.

Read this at a glance note on ‘International Day against Drug Abuse and Illicit Trafficking‘ in the Think Tank pages of the European Parliament.

Written by Angelos Delivorias (1st edition).

Two European Union (EU) directives regulate the EU collective investment funds industry, the Directive relating to undertakings for collective investment in transferable securities (UCITS) and the Alternative Investment Funds Manager Directive (AIFMD). The UCITS, which covers mutual funds, lays down uniform rules, allowing their cross-border offer, while the AIFMD, which covers hedge funds and private equity, lays down the rules for authorising, supervising and overseeing the managers of such funds. While reviewing the application of the scope of the AIFMD (as mandated), the European Commission considered that a number of issues highlighted in the AIFMD review were equally relevant for the activities of UCITS. As a result, it proposed to amend both directives, to better align their requirements.

The file is currently under review by the co-legislators. Within the European Parliament, it has been assigned to the Committee on Economic and Monetary Affairs, which is now considering the draft report.

Version

• June 2022: Amendments to AIFMD and UCITSD (1st edition)

Proposal for a Directive of the European Parliament and of the Council amending Directives 2011/61/EU and 2009/65/EC as regards delegation arrangements, liquidity risk management, supervisory reporting, provision of depositary and custody services and loan origination by alternative investment funds Committee responsible:Economic and Monetary Affairs (ECON)COM(2021) 721
25.11.2021Rapporteur:Isabel Benjumea (EPP, Spain)2021/0376(COD)Shadow rapporteurs:Paul Tang (S&D, the Netherlands)
Billy Kelleher (Renew, Ireland)
Mikuláš Peksa (Greens/EFA, Czechia)
Gunnar Beck (ID, Germany)
Eugen Jurzyca (ECR, Slovakia)Ordinary legislative procedure (COD) (Parliament and Council on equal footing – formerly ‘co-decision’) Next steps expected: Vote in committee on the draft report © ipopba / Adobe Stock

Written by Nikolina Šajn (1st edtion).

On 30 March 2022, the Commission published a proposal for a directive empowering consumers for the green transition, through better protection against unfair practices and better information. The proposal is designed to enhancing consumer rights in making informed choices in order to play an active role in the transition to a climate-neutral society. It proposes new rules to provide consumers with information on products’ sustainability, in particular their durability and reparability, at the point of purchase. It also aims to promote commercial guarantees exceeding the two-year legal guarantee, as well as to ban false and misleading green claims (‘greenwashing’) and certain types of premature obsolescence of products.

In the European Parliament, the file has been referred to the Committee on the Internal Market and Consumer Protection. In the Council, discussions have started in the working party on consumer protection and information.

Version

• June 2022: Empowering consumers for the green transition (1st edtion)

Proposal for a directive of the European Parliament and of the Council amending Directives 2005/29/EC and 2011/83/EU as regards empowering consumers for the green transition through better protection against unfair practices and better information Committee responsible:Internal Market and Consumer ProtectionCOM(2022) 143
30.3.2022Rapporteur:Biljana Borzan (S&D, Croatia)2022/0092(COD)Shadow rapporteurs:Arba Kokalari (EPP, Sweden)
David Cormand (Greens/EFA, France)Ordinary legislative
procedure (COD)
(Parliament and Council
on equal footing –
formerly ‘co-decision’) Next steps expected: Publication of draft report

Written by Marcin Grajewski.

EU Heads of State or Government will discuss war-torn Ukraine’s bid to join the EU when they meet at a regular European Council meeting in Brussels next week. The leaders are expected to discuss Ukraine’s request to gain the status of official EU candidate along with French President Emmanuel Macron’s plan to create a ‘European Political Community’, with Ukraine as a member, as news media have reported, quoting draft Council conclusions. The meeting on 23-24 June is unlikely to make any firm decisions on either of the two proposals, the quoted draft conclusions suggest. EU enlargement, which had been on the backburner for some years, returned to the spotlight after Russia attacked Ukraine on 24 February. Having failed to conquer Ukraine quickly, Russia is now concentrating its war effort in the south-eastern provinces of the country.

This note gathers links to recent publications and commentaries from many international think tanks on Russia’s war on Ukraine. Earlier analyses of the implications of the war can be found in a previous edition of the ‘What Think Tanks are Thinking’ series.

Ukraine’s female soldiers reflect country’s strong feminist tradition
Atlantic Council, June 2022

Russia’s war on global food security
Atlantic Council, June 2022

Food security: The role and limits of international rules on export restrictions
Bruegel, June 2022

What Russia’s war in Ukraine means for Europe
Carnegie Europe, June 2022

Russia’s lesser-known intentions in Ukraine
Carnegie Europe, June 2022

Supporting democracy after the invasion of Ukraine
Carnegie Europe, June 2022

European Union imposes partial ban on Russian oil
Center for International and Strategic Studies, June 2022

Will Putin’s war in Ukraine make the EU stronger?
Centre for European Policy Studies, June 2022

The militarization of Russian polar politics
Chatham House, June 2022

Expert insights: Russia and Ukraine
Clingendael, June 2022

How the war in Ukraine shapes the multipolar world
Egmont, June 2022

One hundred days of the war in Ukraine: Who’s winning and who’s losing?
Friends of Europe, June 2022

Preventing the West from losing the war in Ukraine: Keeping an eye on the geopolitical ball
Friends of Europe, June 2022

Missing in action in Ukraine: German leadership
German Marshall Fund, June 2022

Why it is so hard to repeat the Marshall Plan
German Marshall Fund, June 2022

Victory for Ukraine will also be defined by EU enlargement
German Marshall Fund, June 2022

Should the EU offer Ukraine candidate status?
German Marshall Fund, June 2022

Why Ukraine (and Moldova) must become EU candidates
Istituto Affari Internazionali, June 2022

Not yet time for diplomacy: Lessons from Italy’s iIl-conceived peace plan for Ukraine
Istituto Affari Internazionali, June 2022

Russia’s war on Ukraine: A sanctions timeline
Peterson Institute for International Economics, June 2022

Russian disinformation efforts on social media
Rand Corporation, June 2022

Ukraine’s best chance for peace
Rand Corporation, June 2022

Three possible futures for a frozen conflict in Ukraine
Atlantic Council, May 2022

The Russia-Ukraine war at three months
Brookings Institution, May 2022

Fiscal support and monetary vigilance: Economic policy implications of the Russia-Ukraine war for the European Union
Bruegel, May 2022

Ukraine needs external financial assistance now
Bruegel, May 2022

The EU needs transparent oil data and enhanced coordination
Bruegel, May 2022

Now is not the time to confiscate Russia’s central bank reserves
Bruegel, May 2022

NATO, the EU and the return of collective defence
Brussels School of Governance, May 2022

German ambiguity is deciding Ukraine’s future
Carnegie Europe, May 2022

Does the EU need a new enlargement policy?
Carnegie Europe, May 2022

State of the Union: Three months into Putin’s war
Centre for European Reform, May 2022

The coming storm: Insights from Ukraine about escalation in modern war
Center for International and Strategic Studies, May 2022

L’Europe dans la tempête parfaite
Fondation Robert Schuman

The Kremlin’s aims and assumptions: Russia’s war in Ukraine
International Centre for Defence and Security, May 2022

Ukraine should wait on cease-fire talks with Russia: Here’s why
Council on Foreign Relations, May 2022

The unprofessional Russian soldier
Egmont, May 2022

A question of balance: India and Europe after Russia’s invasion of Ukraine
European Council on Foreign Relations, May 2022

Turkey, NATO, and the Ukraine war: Why Erdogan’s grievances are about more than Sweden and Finland
European Council on Foreign Relations, May 2022

World hunger crisis: Is an apocalypse awaiting us?
Friends of Europe, May 2022

Beyond the “End of History”: Nationalism, liberalism and the war in Ukraine
Istituto Affari Internazionali, May 2022

The sporting sanctions against Russia: Debunking the myth of sport’s neutrality
Istituto Affari Internazionali, May 2022

Premiers enseignements nucléaires de la guerre en Ukraine
Institut français des relations internationales, May 2022

The war in Ukraine: More Western aid and fear of escalation
Institute for National Security Studies, May 2022

What Putin’s war in Ukraine means for the future of China-Russia relations
The London School of International Economics and Political Science, May 2022

Eine Chronologie der nuklearen Anspielungen Moskaus im Krieg gegen die Ukraine
Stiftung Wissenschaft und Politik, May 2022

Will the Russia-Ukraine war speed European fiscal integration?
Peterson Institute on International Economics, May 2022

Rethinking the EU’s role in European collective defence
Rand Corporation, May 2022

Read the complete briefing on ‘Ukraine’s application to join the EU‘ in the Think Tank pages of the European Parliament.

Written by Mar Negreiro (1st edition).

In its digital decade strategy, the European Commission has put forward its vision for new strategic digital objectives for 2030. These should prepare Europe for the roll-out of the next generation of broadband infrastructure with gigabit speeds, including 5G, for the digital transformation of the public and private sectors, and to improve the digital divide. To measure progress towards the digital decade, the Commission proposes a ‘digital compass’ with indicators based on four dimensions: improved digital skills, secure and sustainable digital infrastructures, digital transformation of businesses, and digitalisation of the public sector.

The decision will establish the ‘Path to the digital decade’ policy programme, which aims to set up a governance framework and funding to help achieve the 2030 digital decade targets, including multi-country projects and cooperation mechanisms between the Commission and Member States.

At the European Parliament, the file has been allocated to the Committee on Industry, Research and Energy, which adopted its report on 17 May 2022 and also agreed to enter into negotiations with the Council. The mandate was endorsed by Parliament during the June plenary session.

Version

• June 2022: Path to the digital decade programme (1st edition)

Proposal for a decision of the European Parliament and of the Council establishing the 2030 Policy Programme ‘Path to the Digital Decade’ Committee responsible:Industry, Research and Energy (ITRE)COM(2021) 574
15.9.2021Rapporteur:Martina Dlabajová (Renew, Czechia)2021/0293(COD)Shadow rapporteurs:Ivan Štefanec (EPP, Slovakia)
Josianne Cutajar (S&D, Malta)
Jordi Solé (Greens/EFA, Spain)
Elena Lizzi (ID, Italy)
Jessica Stegrud (ECR, Sweden)
Marisa Matias (The Left, Portugal)Ordinary legislative
procedure (COD)
(Parliament and
Council on equal
footing – formerly
‘co-decision’) Next phase: Trilogue negotiations

Written by Giulio Sabbati and Alex Wilson.

This infographic aims to provide an overview of some of the most important energy indicators. It is purely for information purposes and subject to change. Figures on page one are based on market data (gas and oil prices) or data supplied by market actors (LNG capacity and gas storage rates). Figures on page 2 are based on the latest publicly available Eurostat data. These data are only available retrospectively, usually on an annualised basis, and therefore do not reflect the latest state-of-play following the outbreak of the war.

Electricity prices for household and non-household consumers, € per kWh, second half of 2021. EU energy import dependency from Russia, Share of total import Final energy consumption by sector, Million tonnes of oil equivalent (MTOE) Gas price in the EU, Title Transfer Facility (€ per megawatt-hour) Gas storage, Available storage capacity (Twh) and filling rate LNG capacity per Member State, Billion m3, April 2022 Brent Crude oil (US$ per barrel) Share of energy from renewable sources%, 2020

Read this infographic on ‘Monitoring the energy situation in the EU: June 2022‘ in the Think Tank pages of the European Parliament.

Written by Monika Kiss.

The unjustified Russian invasion of Ukraine has damaged transport infrastructure, caused major transport disruptions and led to a massive flow of refugees into the EU and neighbouring countries.

In response, the EU has adopted several sets of sanctions, leading to the closure of EU airspace to Russian aircraft, the closure of EU ports to Russian vessels, a ban on Russian transport operators and a ban on exports of goods and technology in the aviation, maritime and space sectors.

Designed to undermine Russia’s economic and financial ability to sustain its war effort, the sanctions have also impacted on transport in the EU, leading to traffic shortages, supply chain bottlenecks and the need to bypass traditional routes, thereby lengthening journey times and increasing costs.

In order to monitor and deal with these negative impacts and humanitarian crises, the EU has introduced measures to support traffic flows and supply chains, securing the swift and safe transfer of people trapped in war zones and the transfer of essential goods and commodities.

The European Commission has devised a dedicated contingency plan for transport to strengthen coordination in the event of emergencies. It introduces guiding principles for implementing crisis response measures, and contains a number of initiatives intended to remedy the difficulties encountered following the war.

The European Parliament is meanwhile playing an active role by closely monitoring and evaluating the situation, including the EU action taken so far, while also proposing the adoption of additional EU measures to support passenger and freight traffic flows.

This briefing updates an ‘at a glance’ note on the same topic, published in March 2022.

Read this at a glance note on ‘Russia’s war on Ukraine: Implications for transport‘ in the Think Tank pages of the European Parliament.

Written by Marketa Pape (1st edition).

Wage policy in the EU is a patchwork of different national traditions and legal frameworks. As a result, minimum wage levels diverge considerably, and leave many workers unprotected. While setting minimum wages is the competence of EU Member States, the EU has a supporting and complementary role.

In October 2020, the European Commission proposed a directive seeking to improve the adequacy and increase the coverage of minimum wages, while also strengthening collective bargaining as the main instrument to ensure fair wages and working conditions. It is the first time that the Commission has initiated legislative action on minimum wage protection, leaving Member States to define the specific minimum wagelevels. The ensuing debate focused on how far-reaching and binding the concrete EU requirements for national minimum wages should be.

The European Parliament adopted its position in November 2021, and the Council in December 2021. Interinstitutional negotiations concluded on 6 June 2022 with a provisional agreement that must now be confirmed by the Parliament and Council.

Version

• June 2022: Directive on adequate minimum wages (1st edition)

Proposal for a directive of the European Parliament and of the Council on adequate minimum wages in the European Union Committee responsible:Employment and Social Affairs (EMPL)COM(2020) 682
28.10.2020Rapporteurs:Dennis Radtke (EPP, Germany)2020/0310(COD)Shadow rapporteurs:Agnes Jongerius (S&D, Netherlands)
Monica Semedo (Renew, Luxembourg)
Mounir Satouri (Greens/EFA, France)
Dominique Bilde (ID, France)
Anna Zalewska (ECR, Poland)
Özlem Demirel (The Left, Germany)Ordinary legislative
procedure (COD) (Parliament
and Council on equal
footing – formerly ‘co-decision’) Next steps expected: First-reading vote in plenary

Written by Ionel Zamfir.

Ending impunity for serious crimes against human rights and humanitarian norms is an important EU and United Nations objective. It is essential in overcoming the legacy of past conflict and building the basis of stable, peaceful societies, as shown by the experience of societies that have taken this path in recent decades. The EU has developed a comprehensive approach to help non-EU countries implement transitional justice.

Historical background

The field of transitional justice emerged in the late 1980s and early 1990s, in response to the political transitions that took place during that time in Latin America and Eastern Europe. The implementation of transitional justice measures depended on the national context, varying greatly, e.g. among former communist regimes. Today, the focus of transitional justice mechanisms has moved to countries afflicted by conflict in Africa and Asia. The International Criminal Court (ICC), established in 2002, aims to complement national systems where these are unable to bring to justice for serious crimes those in the highest positions of responsibility. Transitional justice aims both at holding those responsible for serious crimes to account and providing redress to victims, as well as at building fairer and resilient justice systems able to secure reconciliation and the transition to democracy. It includes several measures:

Prosecution of leaders and high officials of former regimes: communist leaders in some eastern European countries and leaders of military juntas in Latin America (Argentina 1985 verdict, Guatemala 2013 verdict, finally invalidated), faced justice in their countries, while others – former presidents of Serbia (died before conviction), Côte d’Ivoire (acquitted) and Kosovo (ongoing), stood trial in international tribunals.

Prosecution: independently of rank, of perpetrators of grave crimes, particularly genocide: Rwanda. (1994).

Lustration policies: including vetting procedure before holding public office: these were central to the efforts of former communist countries in Europe (such as Germany, Czechia and Estonia), in overcoming their past and building stable democracies, but they were not free of judicial controversy regarding the concordance of lustration laws with human rights.

Truth initiatives: ranging from the opening of secret services archives (as in former communist countries) to the Truth Commission in South Africa, (1995), while in Cambodia in 1995, a non-governmental organisation (NGO) assumed the task of preserving the memory of genocide.

Rehabilitation and redress: for those convicted on political grounds or for persecuted groups.

Amnesty: the most controversial approach to transitional justice, as it precludes justice for victims, can be instrumental in ending bloody conflict. However, amnesty cannot apply in serious crimes against humanity and other similar crimes, as made clear in the landmark decisions of the Inter-American Court of Human Rights. In Latin America, amnesty was granted broadly to allow transition, but amnesty laws were later struck down for grave crimes in Argentina (2003), Guatemala (1996) or Peru (2019), although not in Brazil.

United Nations framework

For the United Nations, according to the numerous documents adopted by its various fora, transitional justice ‘comprises the full range of processes and mechanisms associated with a society’s attempts to come to terms with a legacy of large-scale past abuses, in order to ensure accountability, serve justice and achieve reconciliation. These may include both judicial and non-judicial mechanisms’. This definition is broadly used, including by the EU. The UN has developed a comprehensive approach to transitional justice based on four pillars: truth, justice, reparation, and guarantees of non-recurrence. According to a 2022 report from the Office of the High Commissioner for Human Rights (OHCHR), transitional justice should be ‘context-specific, comprehensive, victim-centred, gender-sensitive, participatory and nationally owned’. Moreover, transitional justice is expected to contribute to peace and reconciliation, an aspect underlined in the most recent resolution on the topic by the UN Human Rights Council (UNHRC). The UNHRC considers that transitional justice processes, including the promotion of truth, justice, reparation and guarantees of non-recurrence, can prevent a repeat of past atrocities or similar violations and contribute to sustainable peace.

European Union action

Closing the accountability gap, fighting impunity and supporting transitional justice is among the priorities of the EU action plan on human rights and democracy for 2020-2024. According to the specific actions outlined under this objective, the EU commits to support national-level initiatives and transitional justice processes for fighting impunity for human rights violations. The EU further commits to engage with international justice mechanisms, such as hybrid UN tribunals.

The EU High Representative/Vice-President and European Commission developed an EU policy framework on support to transitional justice, which was endorsed by the Council in its conclusions of November 2015. The framework provides guidance for both EU institutions and Member States, based on main UN elements:

• criminal justice: the EU supports the reform of national criminal legislation, as well as initiatives to develop prosecutorial and judicial capabilities, adequate legal defence, and long-term protection and assistance for witnesses and victims; the EU further supports alternative ways (mediation or traditional courts) to provide justice; it supports the ICC;
• truth: the EU promotes truth-seeking initiatives based on international law and best practice;
• reparations: the EU encourages a participatory, victim-focused approach to reparations;
• guarantees of non-recurrence/institutional reform: the EU provides support to security and justice sector reforms, with the objective to establish civilian control, governance and security force accountability. The EU encourages the adoption of vetting procedures and codes of conduct, in accordance with international human rights standards.

The framework also emphasises that transitional justice processes must be nationally and locally owned and inclusive; adapted to the needs and specificities of the local communities and countries concerned; they must comply with international norms and standards; and must be gender and child sensitive. The EU opposes amnesties for war crimes, crimes against humanity, genocide or gross violations of human rights, in line with the UN position. According to the framework, the EU should integrate its support for transitional justice in its crisis response and peacebuilding; and in development and enlargement policies.

The EU is an important player in the field of transitional justice. The EU supports the ICC; it helps countries in situations of fragility; it implements a comprehensive approach to external conflicts and crises; it integrates the pursuit of transitional justice in its common security and defence policy (CSDP) missions, and provides financial support for transitional justice initiatives and related issues. Transitional justice is among the priorities of multiannual indicative programmes jointly agreed with partner countries including Burundi, Central African Republic, Colombia, Rwanda, South Sudan and The Gambia, as well as among the priorities for the implementation of the EU thematic programme on human rights and democracy, both funded by the Global Europe Instrument. Transitional justice is also integrated into EU enlargement policy, where the Commission’s annual reports assess progress in this respect. The EU annual report on human rights and democracy provides specific examples (see 2021).

European Parliament position
The European Parliament has repeatedly underlined the need to put an end to impunity for grave crimes under international law. Parliament’s February 2022 resolution on human rights and democracy in the world – EU annual report 2020 calls for the promotion of transitional justice processes that empower civil society, victims, marginalised and vulnerable populations; and urges the EU to strengthen its response to conflicts, autonomously and in collaboration with partner countries and regional organisations, including a strong focus on transitional justice. In its January 2021 resolution on human rights and democracy in the world and the EU’s policy on the matter – annual report 2019, Parliament proposes to promote EU commitment to the fight against impunity by establishing an EU Special Representative on International Humanitarian Law and International Justice and underlines the need to ensure justice for all victims of violations of international human rights and humanitarian law. It also stresses that the international community has a responsibility to end impunity; and calls for the EU to ensure the integration of a gender perspective, increasing the role of women and young people in transitional justice. In a March 2019 resolution on building EU capacity on conflict prevention and mediation, Parliament declares that a pool of experts covering reconciliation and transitional justice is needed at EU level.

Read this at a glance note on ‘Transitional justice: Central to fighting impunity‘ in the Think Tank pages of the European Parliament.