| | Dear Readers,
Nothing is as certain as uncertainty. Only a few hours until the polling stations close and the race for the US presidency is still too close to call. This is mainly due to the American electoral system. In recent nationwide polls, the Democratic candidate Kamala Harris has always been a few points ahead of the Republican Donald Trump. But in the USA, that means nothing.
The decisive factor is not the absolute number of votes but how many electoral votes a candidate manages to secure. As the majorities in most US states are clear, it comes down to a few so-called swing states - seven in total - which are always the focus of attention due to their changing majorities. Whoever comes out on top in those states will be moving into the White House. Election observers agree that Pennsylvania will be the decider and probably only by a matter of a few thousand, if not a few hundred votes.
But things could also turn out quite differently. Election forecasting in the USA has recently looked more like a lottery. Trump’s election in 2016, for example, was not predicted by a single polling organisation. In the last congressional elections, the augurs predicted a landslide victory for the Republicans. As we know, things turned out differently.
So we might all be rubbing our eyes in amazement on Wednesday if one of the two candidates manages to gain a wafer-thin majority in most of the swing states and thereby actually walks away with a landslide victory in the electoral college. And that could be either Kamala Harris or Donald Trump. So the election is still on a knife edge.
Yours
Dr. Jörg Köpke |
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| | | | Exciting to the end: Who will win the race? Kamala Harris or Donald Trump? |
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| | | | Latest EU Proposals in Focus |
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| | Technology | Infrastructure |
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| Biotechnologies: European Biotechnology Act
In her so-called mission letters to the Commissioners-designate, Commission President Ursula von der Leyen has announced new EU legislation for the biotechnology segment. By substituting finite raw materials with renewable raw materials, bio-based industrial production will not only improve the greenhouse gas balance of industrial supply chains but also help to reduce dependence on external supplies of fossil fuels, and create additional options for increasing resource efficiency, by utilising biogenic waste and residual materials. At the same time, the bio-based segment of European industry is facing numerous obstacles to growth. The long development phases and highly knowledge-intensive production mean that the increasing shortage of specialised experts and the low liquidity of venture capital markets in the EU are major barriers to new bio-based solutions. In addition, some bio-based segments are facing specific challenges such as the sustainability of biomass production and the diversity of product characteristics. As well as overcoming market barriers, Europe must maintain its position in the global race for innovation in order to secure new potential for value creation by way of technological leadership (see cepInput 5/2024). |
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| | | | | | | | The EU Commission asks decision-makers and interested parties from civil society for their opinion on European policy proposals. Here is our short-list of the most important consultations: |
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| | | GDPR: Legal Basis of Legitimate Interest
On 8 October 2024, the European Data Protection Board (EDPB) published draft Guidelines 1/2024 on the processing of personal data based on legitimate interest in accordance with Article 6(1)(f) General Data Protection Regulation (GDPR). The Guidelines analyse the criteria set out in the GDPR which a "controller" must meet in order to lawfully process personal data on the basis of a legitimate interest. In practice, legitimate interest is one of the most important legal bases under data protection law.
The Guidelines explain in more detail which interests may be deemed legitimate; when data processing may be deemed unnecessary and which aspects the controller must take into account when balancing the interests against one another. The EDPB also explains how this assessment should be carried out in practice and goes into more detail on specific contexts such as data processing for the purposes of fraud prevention, direct marketing and information security. Finally, it also explains the relationship between the aforementioned legal basis and a number of the data subject’s rights under the GDPR.
The Guidelines are not directly legally binding but reflect the common understanding that the European data protection authorities aim to apply in order to ensure uniform application of the GDPR.
Stakeholders and citizens can comment on the Guidelines as part of a Consultation.
The submission period for opinions ends on 20 November 2024.
Go to Consultation |
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| | | | | Capital Markets Union: Revitalising the EU Securitisation Markets
On 9 October 2024, the EU Commission launched a Consultation on the functioning of the EU securitisation framework. This legal framework entered into force in 2017 [Regulation (EU) 2017/2402, see cepPolicyBrief 4/2016] and has applied since 2019. It was adjusted in 2021, during the Covid-19 pandemic [Regulation (EU) 2021/557, see cepPolicyBrief 11/2020]. Calls for a revision of the EU securitisation framework are growing louder, including from the political arena, not least due to the recently published reports by Christian Noyer, Enrico Letta and Mario Draghi. This is intended to strengthen the lending capacity of European banks, deepen the capital markets, contribute to building a savings and investment union and strengthen EU competitiveness. As part of the consultation, the Commission now wants to find out which parts of the current legal framework need to be revised. It will use feedback from the consultation to review the EU securitisation framework. The Commission has already announced, both in its Political Guidelines and in the Mission Letter to the designated Financial Market Commissioner Maria Luís Albuquerque, that it intends to tackle a revision in the 2024-2029 legislative period.
The submission period for opinions ends on 4 December 2024.
Go to Consultation |
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| | | | Digitalisation | New Technologies |
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| Establishing a Scientific AI Committee
The European Commission is requesting feedback on a new implementing regulation to establish a scientific panel of experts in accordance with the recently adopted AI Act. This independent panel will advise and support the new EU AI Office and the national market surveillance authorities regarding the implementation and enforcement of AI legislation. The feedback phase runs from 18 October to 15 November 2024. All feedback submitted will be published and taken into account when finalising the Regulation, which will set out the rules on establishing the panel and how it will operate.
The submission period for opinions ends on 15 November 2024.
Go to Consultation |
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| Data Access Under the Digital Services Act
The European Commission has launched a consultation on a delegated Regulation under the Digital Services Act (DSA). Among other things, this stipulates that very large online platforms and very large online search engines must grant researchers, as well as authorities, access to their data under certain conditions. At the same time, it empowers the Commission to specify, in delegated acts, both the conditions under which such data must be made available and a simple and secure procedure for such data access. The Commission now wants to draw up such a delegated regulation and obtain the views of stakeholders. In particular, it would like to know what types of data, metadata and information could be useful for authorities and researchers, how the application process should be organised, what safeguards should be put in place to limit the purpose for which data is used and to prevent misuse, and what technical specifications could be considered for data access.
cep’s Head of Digitalisation recently contributed to an open letter highlighting the barriers to such data that researchers are currently facing with regard to the integrity of information on large platforms. This letter, initiated by the International Observatory for Information and Democracy, was signed by 150 researchers from 41 countries and published in several international media publications. It appeals to political decision-makers to ensure access to digital information and to support researchers in their work to protect democracy.
The submission period for opinions ends on 26 November 2024.
Go to Consultation |
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| | | | | 4-12 November 2024
Brussels
Confirmation hearings for the European Commission: The European Parliament invites the Commissioners-designate to hearings before the relevant committees. At the hearings, the MEPs check whether, in the opinion of the committee members, the Commission candidates are suitable for the areas of responsibility envisaged for them. More on the hearings in our cepSeries on the "Mission Letters".
5 November 2024
Brussels
Meeting of the Economic and Financial Affairs Council (Ecofin). This will deal in particular with the 'VAT in the Digital Age' package. In addition, the Council intends to take a final vote on the Directive on the recovery and resolution of (re)insurance undertakings, the Directive amending the Solvency II Directive (see cepPolicyBrief 2/2022 in German) and also the Construction Products Regulation (see cepDossier 3/2022 in German).
8 November 2024
Budapest
European Council.*
15 November 2024
Brussels
Economic and Financial Affairs Council. This will deal with the Union budget for 2025.
29 November 2024
Brussels
Competitiveness Council.*
*The agenda was not yet available at the time of going to press. |
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| | | | | | The cepNetwork Freiburg-Berlin-Paris-Rome reports on current political events in France and Italy. |
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| Italian-German Tank Alliance Launched Between Leonardo and Rheinmetall
On 15 October, the Leonardo Group, 30% of which is controlled by the Italian state, signed an agreement with the German company Rheinmetall to establish the joint venture announced in July. The company, which will be based in Rome and operate out of La Spezia in Liguria, will be a German-Italian alliance for the production of tanks, primarily to fulfil a 10-year, € 20 billion order from the Italian army for replacement of the old fleet of Ariete and Dardo tanks with 280 armoured vehicles, some combat, some support, and more than a thousand light tracked vehicles. The Panther KF51 developed by Rheinmetall will form the basis for the new armoured vehicle that will replace the Ariete in the Italian army. The new joint venture, named Leonardo Rheinmetall Military Vehicles, will be based on a 50:50 division of labour between Leonardo and Rheinmetall, with 60% of the activities to be carried out in Italy. The new company will also focus on exports and in particular on the opportunities offered by the new European heavy tanks. Overall, this is a market with an estimated value of more than € 50 billion.
Italy Organises the 7th OECD World Forum on Well-being
From 4 to 6 November 2024, as part of its G7 presidency, Italy will host the 7th OECD World Forum on Well-being. Well-being not only refers to poverty and economic prosperity but encompasses a range of factors, including the way people live, study, work, spend their leisure time or have access to healthcare and medical facilities. Thus, it is a multidimensional concept that should increasingly take centre stage on the agendas of today's policy makers and business leaders. Indeed, well-being plays a fundamental role in improving economic development and increasing the overall competitiveness of companies and countries since it has an impact on productivity levels.
To date, most countries have developed some form of framework to quantify their national levels of happiness, health or general well-being, to name but a few. Nevertheless, the data on general well-being is often separated from data on the "hard" economy. In line with the Finance track under the Italian G7 Presidency, which aims, among other things, to stimulate the adoption of measures to promote well-being, the Forum aims to hold an in-depth discussion based on data and empirical analyses and to share best practices in the areas of social, environmental and distribution policies in order to address major societal challenges such as climate change, digital transformation and artificial intelligence. |
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| | | | | France's Budget for 2025: A Turning Point for Europe's Financial Stability
The debate on the French budget for 2025, which officially began on 10 October with the presentation of the draft finance bill, is of great importance for both France and Europe. For the first time, the French government is planning to cut spending by € 41.3 billion, accompanied by a tax increase of € 19.3 billion. This unprecedented adjustment proposal aims to reduce the public deficit to 5%, while at the same time requesting that a return to the 3% deficit limit be postponed from 2027 to 2029. Without these measures, the deficit could reach 7% in 2025, according to the government, while other euro countries are already in the process of reducing their deficits.
The efforts are unavoidable, as the risk to the eurozone would otherwise be considerable. Rising interest rates in France could force the ECB to intervene again with debt purchases. This could jeopardise the political stability of the eurozone, as northern countries are reluctant to finance budget deficits by way of inflation. The survival of the euro depends on this political adjustment and the French government is called upon to do everything it can to play its part. |
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| | | | | | Mission Letters for the EU Commission 2024-2029 |
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| | Between 4 and 12 November, the Commission candidates will have to answer questions before the European Parliament. The touchstone will be the so-called Mission Letters, in which President Ursula von der Leyen assigns tasks and portfolios to the new Commissioners until 2029. The Centre for European Policy (cep) scrutinised the candidates, departments and EU initiatives, particularly with regard to the internal market and competition. The result: many things should have been more ambitious and structured. |
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| Internal Market and Competition
The Commission wants to remove obstacles and cut red tape to increase more growth. "The current reporting obligations place an excessive burden on all companies, regardless of their size or risk," says cep internal market expert Matthias Kullas. Instead of placing companies under the general suspicion of disregarding regulations, controls should be applied where risks exist or misconduct is suspected. According to Kullas, the Commission wants too much at once in its realignment of competition law. It risks getting bogged down between maintaining competition, creating European champions and decarbonising the economy.
Digital Policy
The Commission wants to further strengthen cybersecurity, catch up in the areas of artificial intelligence (AI) and cloud computing, stimulate investment in digital infrastructures, make EU data policy more coherent and improve the protection of citizens in the digital environment. cep digital expert Anja Hoffmann makes it clear that the EU must, above all, eliminate legal ambiguities if it wants to promote data exchange. "It must also promote the legally compliant anonymisation and use of synthetic data, resolve conflicts with the most important data protection principles and enable an innovation-friendly approach to the General Data Protection Regulation," says Hoffmann. In the field of AI, privileged access to supercomputers for selected start-ups could lead to market distortions. The main criticism is that public funding for AI projects in the EU lags far behind that of China or the USA. "The future of European AI does not lie in European champions, a few supercomputers and centralised planning, but in unleashing its entrepreneurial energies," says cep digital expert Anselm Küsters.
Financial Markets
In the new legislature, the Commission's main objectives will be to create a savings and investment union, make further progress on completing the banking union, ensure that the EU framework for sustainable finance becomes more user-friendly, workable and efficient, ensure the protection of consumers and retail investors in increasingly digital and AI-driven financial services markets and make the digital euro a reality.
cep financial market expert Philipp Eckhardt attaches central importance to the creation of a savings and investment union. Obstacles to investments by private customers must be removed, competition-distorting commission bans avoided, advisory processes streamlined and citizens' financial literacy strengthened. In addition, the complete revision of the EU framework for sustainable finance should be prioritised. Eckhardt does not see the need for a digital euro.
Climate, Energy, Environment, Transport
By 2040, the Commission intends to propose a legally binding reduction in greenhouse gas emissions of at least 90% compared to 1990 levels. The level of ambition of the climate target for 2040 will determine how ambitious the respective EU policies and legal instruments for the period after 2030 must be. "The Commission plans to allow for more technology neutrality in the context of the CO2 fleet limits for passenger cars, where e-fuels play a role. However, more flexibility is needed so that the European automotive industry can achieve the targets and be competitive," says cep climate expert Götz Reichert.
Industrial Policy
The new Commission's industrial strategy is based on four main pillars: Decarbonising energy-intensive industries, innovating and promoting the uptake of green and digital technologies, securing access to critical inputs and protecting European industries from external risks. "To improve industrial competitiveness, the Commission should adopt a coherent, investor-centred approach. This should include removing unnecessary regulatory burdens and strengthening the role of price signals as an incentive for long-term investment in innovation and production of transformation technologies," demands cep economist André Wolf.
Migration
The EU's migration policy is based on the new Pact on Migration and Asylum, a set of new rules that will be implemented during the legislative period. The pact focuses primarily on combating illegal immigration and smugglers, strengthening the EU's external borders and a strict return policy for those who are not entitled to asylum in the EU. "The EU must be careful that some of its intended measures may not stand up in court," cep migration expert Andrea De Petris points out. |
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| | | | | | | | cepAdhoc: Harris Versus Trump: US Presidential Election and its Implications for the European Union |
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| | | The US presidential election is completely open. The Centres for European Policy Network (cep) has analysed the consequences of possible election outcomes for Europe. Core thesis: Geopolitically, both Donald Trump and Kamala Harris are moving away from Europe. With Trump, however, it will be stormier.
Go to cepAdhoc |
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| | | | cepAdhoc: Rethinking the Roots of the EU’s Housing Crisis: The Case of Italy |
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| | | For the first time, the EU is planning its own commissioner for housing. The Centre for European Policy considers this step to be sensible in view of the housing shortage, particularly in the urban centres of many member states. However, the expected measures should not be at the expense of free competition.
Go to cepAdhoc |
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| | | | cepInput: Towards an Efficient Decarbonization of Heat Use |
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| | | Whether financing, renovation requirements or a lack of skilled workers: numerous barriers are slowing down Europe's transition to climate-friendly heating technologies such as heat pumps. The Centre for European Policy is calling for a market-oriented European action plan. The key point is cost reduction.
Go to cepInput |
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| | | | | | The international website "Common Ground of Europe" is an initiative of the Centres for European Policy Network. On the commongroundeurope.eu website, cep collects mainly English-language contributions, articles and interviews from decision-makers and experts in politics, business and science. We cordially invite you to take a look through our window on Europe. Here are some examples from the past month. |
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| | Combining Japanese Tradition and Tech Innovation: A Blueprint for Europe? |
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| Japan’s fusion of tradition and digital technology might offer some lessons for Europe’s transformation. From immersive art installations to interactive screens, the country’s omnipresent innovations showcase that beyond the current AI hype, the digital revolution can truly improve everyday life. However, they also bring up concerns about cultural inclusion and could potentially create new social divides.
Go to article |
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| | | | EIB Vice-President Nicola Beer: „Technological Innovation is Europe’s Motor“ |
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| Since its creation in 1958, the mission of the European Investment Bank (EIB) has been to use its own capital resources to strengthen the EU's internal market. Its shareholders are the EU Member States. In an exclusive interview with cep Head of Communications Jörg Köpke, her first since taking office, EIB Vice-President Nicola Beer calls for more investment in technological innovation.
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| | | | On the Order of a Civilisation in the Age of the Anthropocene and Transhumanism |
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| Looking back at the present day, in fifty or a hundred years' time - in addition to all the smaller and larger crises - two phenomena that are significantly accelerating in their development will probably be regarded as truly drastic in terms of human history: climate change and artificial intelligence. We will then presumably know whether humanity will have succeeded in turning them around for the better.
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| | | | A Fragile Global Arena: How the Election of Donald Trump Could Impact Italy and the EU |
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| In the next months, the results of the American elections could determine a radical change in an already unsettled global arena. When it comes to the EU, the victory of Donald Trump as President of the United States could lead to the search for greater autonomy or, conversely, to an increase of its internal divisions.
Go to article |
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| | | | Relocating Asylum Seekers out of Europe is Not Working |
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| In 2023, it appeared that bilateral agreements between European states and third countries to relocate asylum seekers outside Europe could ease the strain on the continent's reception systems. The UK-Rwanda plan and the Italy-Albania protocol were heralded as innovative solutions, but their real-world execution shows significant failings.
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| | | | | Dear Readers,
The British politician David Lloyd George (1863-1945) once said: "Elections are sometimes the citizen's revenge. The ballot paper is a dagger made of paper."
Yours
Dr. Jörg Köpke |
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