Eurobloat #0133 • May 2021
May was the month the Union gazed lovingly into the mirror, decided the answer to every problem was more of itself, and set about taxing, certifying and grading its way there. Even the courts, the Chinese and the Belarusians could not entirely spoil the self-congratulation.
Folly of the Month: A two-year conference to discover that Europe wants more Europe
On Europe Day, 9 May, presidents Sassoli, von der Leyen and Macron gathered in Strasbourg, complete with a violinist and a string quartet, to launch the Conference on the Future of Europe. The premise was a year of citizen consultations to gather fresh ideas for reform. The conclusion, you may safely wager, was decided before the first note was played, because every such exercise in Brussels arrives at the same destination, which is a larger Brussels with more competences and fewer national vetoes. A continent that had just watched one member state leave was told the cure for its discontents was to be consulted, at length, about how much more integration it secretly craved.
1. A single corporate tax rulebook, written in Brussels
On 18 May the Commission published its Communication on Business Taxation for the 21st Century, promising a new framework called BEFIT that would consolidate the profits of large companies into one EU tax base and parcel them out to member states by formula. Taxation was once the last thing a nation kept for itself. Now it is to be a spreadsheet maintained in Brussels, dressed up as simplification of the rules the Commission itself spent decades complicating.
→ taxation-customs.ec.europa.eu
2. The hunt for a tax the Union can call its own
The same taxation drive carried the half-built digital levy, a tax the Commission had been ordered to deliver by June so that the money might flow not to capitals but to the EU's own coffers as an "own resource". An institution that produces no wealth was busy inventing a way to levy it directly. By July the whole scheme would be quietly shelved to avoid embarrassing the OECD, the public consultation having served chiefly to keep officials occupied.
3. Your papers, please, in interoperable QR form
On 20 May the co-legislators agreed the EU Digital COVID Certificate, a bloc-wide scheme to record who had been jabbed, tested or recovered, presented as the key to free movement. Free movement, you will recall, was already a treaty right until the Union decided a government-issued credential should stand between citizens and it. A continent that lectures the world on privacy built itself a single interoperable system for checking the medical status of every traveller, and called it liberation.
4. The General Court tells the Commission to put the chequebook away
On 12 May the General Court annulled the Commission's order that Amazon repay some 250 million euros to Luxembourg, finding that Brussels had failed to show any selective advantage and had bungled its own analysis. The competition enforcers had spent years insisting a member state's tax arrangement was illegal aid, only for the judges to find errors of fact and law throughout. The lesson, as ever, is that nobody in the Commission is held to account when its grand crusades collapse in court.
5. Parliament freezes the grubby deal it had just signed off
On 20 May the Parliament voted, by 599 to 30, to freeze ratification of the Comprehensive Agreement on Investment with China, the trophy deal the Commission had rushed to seal only five months earlier. Seven years of negotiation with Beijing, concluded at speed over Christmas, were halted the moment China sanctioned a handful of MEPs. Refusing to bless a pact with a regime conducting crimes against humanity is the correct call. One only wonders why Brussels needed the insult to its own members to notice.
6. Brussels reserves the right to grade Britain's homework
On 11 May the Parliament's civil liberties committee passed a resolution urging the Commission to refuse, or at least suspend, data adequacy for the newly independent United Kingdom, fretting about its national security exemptions and immigration rules. A sovereign nation that wrote the GDPR into its own law was nonetheless to be inspected, doubted and, ideally, cut off. The schoolmaster instinct survives Brexit intact, even when the pupil left the school.
7. A summit to declare that social rights are a reality
On 7 and 8 May the leaders convened in Porto for a Social Summit, where they solemnly co-signed the Porto Social Commitment and set targets for 2030 to be achieved across the whole Union. The European Pillar of Social Rights, proclaimed in 2017, was reaffirmed with the usual round numbers and the usual absence of any treaty power to deliver them. Employment and training are matters for member states, but no gathering in Porto is complete without Brussels promising, on their behalf, to fix everything by a date safely in the future.
8. Banning a dictator's airline, one emergency summit at a time
After Belarus forced down a Ryanair flight on 23 May to seize a journalist, EU leaders met the next day and agreed to bar Belarusian carriers from European airspace and airports and to urge their own airlines to avoid the country. The outrage was justified. The spectacle of the bloc discovering, only after a hijacking, that it had spent years cosying up to Minsk and Moscow was rather less impressive, and the formal ban would not be enacted until June.
9. The red tape so heavy even the Commission's own auditors balked
The Commission's flagship sustainable corporate governance directive, a new layer of due-diligence duties for European business, was quietly pushed back during May after its own Regulatory Scrutiny Board issued not one but two negative opinions on the impact assessment. When the in-house quality controllers twice refuse to wave a proposal through, the burden being designed is heavy indeed. The answer was not to drop it but to delay, redraft and try again in the autumn, because a Brussels obligation deferred is never a Brussels obligation abandoned.
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