Welcome to the Capitals, your concise and comprehensive summary of European news from Eddy Wax and Nicoletta Ionta in Brussels. We welcome feedback and tips here. You can sign up here.

In today’s edition:

• The Commission insists it hasn’t abandoned its anti-greenwashing law
• Iran conflict looms over NATO and EU summits this week
• Europe’s far-right transnational revolutionaries
  

The European Commission left journalists dumbfounded on Friday by saying it intended to withdraw a major upcoming anti-greenwashing directive but refusing to say why.

Now the Berlaymont tells us the directive needn't be withdrawn after all and inter-institutional negotiations can continue – but only at a price.

A senior Commission official told me last night that the Green Claims file – designed to make companies label products more accurately – lives on, provided the text is tweaked to exempt millions of micro-enterprises from its scope.

That could be news to member states though. Two Council sources told me that the issue of micro-enterprises had been largely resolved at an ambassadors’ meeting last Wednesday. Yet obviously, not sufficiently to Ursula von der Leyen’s liking.

The Commission’s announcement that it was abandoning the file Friday came just two days after Manfred Weber’s centre-right EPP lawmakers demanded it be withdrawn. The optics suggested that the EPP-dominated Commission was quickly acquiescing to demands from its allies in Parliament to knock the bill on the head. For months, Weber’s EPP have sided with further-right parties to pass controversial texts, meaning his opponents were primed and ready to explode if they felt he was unfairly getting his way.

Cue a massive backlash from Socialist, Green and liberal MEPs. Von der Leyen came under pressure from Valérie Hayer, the leader of liberal Renew, who said she raised the Commission’s “disgraceful” move with its president. Parliament negotiator Tiemo Wölken, a German social democrat, told me on WhatsApp: “The public statements by the [Commission] that they consider [withdrawing] the proposal interfered unduly with the democratic process."

Our best guess as to what is going on is that the Commission is trying to clean up a bad communications mess from Friday, and also send a message about the importance of its agenda for slashing red tape.

The senior commission official put it to me this way. “The simplification omnibuses have been about fixing past mistakes ... The thinking of this European Commission is also not to adopt new legislation that would in future need to be fixed.”

“What happened to all the previous ones?” – W. Gyude Moore, Liberia’s former minister of works, after Europe promoted yet another plan for Africa in Italy on Friday called “the Mattei Plan”.

Middle East

EPP-Socialist divide in Brussels: The two EU presidents have built a tradition of releasing joint statements, synchronising their positions word-for-word and projecting harmony. But after the US bombed Iran on Sunday, Ursula von der Leyen (an EPP Christian Democrat) and António Costa (a Socialist) were not singing from exactly the same hymn sheet.

While von der Leyen said that “Iran must never acquire the bomb” in the first line of her statement, Costa emphasised he was “deeply alarmed,” called for “restraint” and talked about civilian victims.

There was an even more blunt statement from the Commission’s most senior Socialist commissioner, Spain’s Teresa Ribera, who wrote the following ominous line on BlueSky: “Decades to build an international order based on the UN charter, human rights and the rule of law.” She later re-posted an FT op-ed that argued Trump’s intervention makes the world a more dangerous place.

Israel on the agenda: EU foreign ministers will today talk about the Iran conflict, and a recent internal review that found “indications” Israel is breaching the terms of its EU trade deal due to its conduct in Gaza. There’s little-to-no expectation that the EU will actually cut trade ties, but a growing list of potential EU responses is putting pressure on Israel.

Euractiv’s Alexandra Brzozowski reports that Israel has responded to the internal review, calling it “outrageous and indecent”.

O Canada

Europe’s favourite North American, Canadian PM Mark Carney, is in Brussels for an EU summit today aimed at “deepening the relationship across all sectors”, including greater access to the single market, according to his office. Ahead of the talks, EU officials were joking that the joint declaration reads “a bit like an enlargement document”.

Maple-shield cooperation: A key objective will be a new EU-Canada security and defence agreement, marking the first step for Canada to participate in SAFE, the EU’s €150 billion programme to bolster joint defence procurement. An EU official said a bilateral agreement – a pre-requisite for Canadian firms to begin bidding – could follow soon after, paving the way for both sides to seize procurement opportunities.

Trump 2.0 hits Europe

New analysis from the European Council on Foreign Relations makes for interesting reading on Trump’s influence on the European political landscape.

“Europe’s far-right forces are transforming from self-styled defenders of national sovereignty into the continental vanguard of a transnational revolutionary movement – aligning themselves with Trump’s bid to remake global order,” authors Ivan Krastev and Mark Leonard argue. Meanwhile, mainstream parties are “the new European sovereigntists”.

Polling published by the think tank shows that Romanians (30%), Hungarians (29%) and Poles (25%) are the Europeans most likely to think Trump’s second term is good for their country.

GERMANY
Germany plans to hire 11,000 additional military staff by the end of 2025, including 10,000 soldiers, according to German media reports. The extra funds will be made available with the upcoming budget and would lead to a 4% personnel increase if hiring proceeded as planned.

SPAIN
Spain has won an exemption from NATO’s new 5% defence spending target, with PM Pedro Sánchez announcing it would spend 2.1% on defence, “no more and no less”. Read more here, and in Aurélie’s Firepower newsletter, which is published daily this week.

POLAND
Less than a third of Poles think that president-elect Karol Nawrocki will ensure good relations with Ukraine, according to a new poll. Read more.

SLOVAKIA
An opinion poll published shortly after PM Robert Fico’s surprising remark that “neutrality would suit Slovakia” shows little public support for the idea, with more than half of Slovaks rejecting it outright. Read more.

A suicide bomber killed 22 people at the Greek Orthodox Church of Prophet Elias in Damascus on Sunday, prompting Greek authorities to call on the Syrian transitional authority to do more to protect religious minorities. Read more.

Belarus has released 14 prisoners including Siarhei Tsikhanouski, the leader of the opposition to President Aleksandr Lukashenko. Read more.

European Council President António Costa, European Commission President Ursula von der Leyen, and Canadian Prime Minister Mark Carney attend the EU-Canada Summit in Brussels

EU foreign affairs ministers meet in Brussels

NATO Secretary General Mark Rutte holds a press conference on upcoming summit in the Hague, at 3 p.m.

Agriculture and Fisheries ministers meet in Luxembourg

Tourism ministers meet in Warsaw

European Parliament Economic and Monetary Affairs Committee holds a hearing with ECB President Christine Lagarde

European Commission President Ursula von der Leyen welcomes Prime Minister of New Zealand Christopher Luxon in Brussels

Contributors: Alexandra Brzozowski, Stefano Porciello, Aleksandra Krzysztoszek, Natália Silenská, Inés Fernández-Pontes, Nick Alipour, Aurélie Pugnet Nikolaus J. Kurmayer.

Editors: Vince Chadwick and Sofia Mandilara.