EU digital single market progress may accelerate

Subject The EU’s digital single market. Significance The Commission proposed Bulgarian member of the European Parliament (MEP) Mariya Gabriel as the new commissioner for digital policy on May 16. The appointment came as a review of progress on the EU’s digital single market strategy shows mixed results to date. Impacts Gabriel is likely to be approved by the Parliament, and her background as MEP will compensate for her lack of relevant experience. A fully functioning digital single market could add 415 billion euros (464 billion dollars) to the EU’s GDP per year. The recent ransomware attack will give added urgency to action at the EU level, though countries may be reluctant to surrender sovereignty.

Author(s):  
Viola Elam

This paper provides an overall assessment of recent initiatives devised by the European Commission as part of the Digital Single Market Strategy (“DSMS”) and beyond. A connecting thread running through various policy documents and legislative proposals is the principle of copyright territoriality. Copyright’s territorial nature is identified as a great hindrance to the establishment and smooth functioning of an internal market for digital content and services, since it contributes to the cumbersomeness of rights clearance, territorial exclusivity and geo-blocking practices. Nonetheless, the initial policy options, geared towards a substantial erosion of copyright territoriality, have not been articulated in concrete legislative measures. The Commission has finally opted for a considerably less ambitious approach, which purports to mitigate some minor side effects of territoriality. The proposal seeking to mandate full accessibility of content across the EU was watered down to accommodate concerns expressed by the majority of stakeholders in the creative industry. The efforts to tackle geo-blocking are not addressed to providers of audio-visual content and copyright-protected works. The extension of the “country of origin” principle is limited to services ancillary to broadcasts. Likewise, cross-border “portability” of content does not offer a real solution to dismantling national barriers in the European digital environment. Hence, copyright will remain territorially grounded and a full integration of markets for creative content will not become a reality, at least in the near future. This paper discusses the potential lack of continuity between the overarching aims expressed in the DSMS and subsequent legislative steps, and criticises the use of terminology leading to legal uncertainty. The newly introduced neighbouring right for press publishers might represent an additional source of territorial fragmentation. The (general monitoring) obligation imposed on information society service providers requires strict scrutiny. This paper, however, values the adoption of regulations, entailing a deeper level of harmonisation, and the provision of mandatory exceptions and limitations


Significance This followed a landmark speech on January 17 in which she added more clarity and detail to her previous stance on the United Kingdom’s departure from the EU. May indicated a willingness to leave the single market, strongly implied that the United Kingdom would not be part of the customs union in its current form and asserted that she would rather quit the EU with no permanent or transitional deal agreed than accept an arrangement which limited the United Kingdom’s future freedom of action. Impacts The government is likely to meet its preferred timetable for triggering Article 50 even if it has to obtain approval from parliament. The United Kingdom will probably lose its passporting rights, which allow UK-based banks to sell their products across the EEA. Paris and Frankfurt will probably benefit as banks may seek to move some of their staff out of London.


Subject The European Parliament and the Transatlantic Trade and Investment Partnership. Significance The last-minute decision of the European Parliament (EP) to postpone a June 10 debate and vote on the Transatlantic Trade and Investment Partnership (TTIP) has exposed important divisions among its members (MEPs) over whether and how closer EU-US economic ties can be secured. While non-binding at this stage, the debate and vote would have provided important guidance to the European Commission on its priorities and room for manoeuvre as it engages in further negotiations with the United States. TTIP must ultimately be ratified by the EP, which has voted down international agreements in the past. Impacts The EP's difficulties in finalising its views could constrain the Commission in the TTIP negotiations. However, given the EP's ultimate veto over the deal, time spent now on hammering out an ISDS formula it could accept may not be wasted. Any rejection of TTIP, particularly over ISDS, could raise questions over future international trade deals premised on deep integration. TTIP rejection could even jeopardise concluded trade deals awaiting ratification, such as that between the EU and Canada. Progress on TTIP is among the measures sought by UK Prime Minister David Cameron before his EU membership referendum.


Subject The EU's single market for energy. Significance Climate change targets, the EU's Emissions Trading Scheme (ETS) and direct emissions controls increasingly define the end-destination of the EU’s energy transition towards a single market, while the precise path of travel is determined largely by national-level policies. Differences in national approaches create distortions that hamper the increase in cross-border trade required to make the EU single energy market a reality. Impacts The EU will continue to resist capacity markets and strategic-reserve mechanisms, which create significant market distortions. Cross-border electricity trade requires significant new investment, but it is not clear that the financial incentives exist to support it. The long-term future of gas-fired generation is in doubt owing to increasing competition from low-carbon technologies.


Subject Romania after Dragnea. Significance For much of the last five years that Liviu Dragnea controlled the Social Democrats (PSD), he also dominated the Romanian state politically. His 42-month sentence for corruption, handed down on May 27, has opened up a vacuum in the ruling PSD, and there is no obvious successor. The verdict came immediately after two electoral blows -- massive defeat in the European Parliament (EP) elections; and a resounding rebuff in a non-binding referendum in which over 80% opposed PSD attempts to amend or cancel anti-corruption legislation. Impacts President Iohannis is likely to assert himself in foreign policy, but has lost leverage in deciding senior judicial appointments. The presidential election this autumn may not be crucial in the tussle for power, as the presidency has much-reduced powers. The EU will be highly critical of Romania’s fast-increasing budget deficit, a legacy of the Dragnea era.


Subject Proposed reform of the EU comitology procedure. Significance The little-known ‘comitology’ procedure plays a key role in EU regulation. In recent years, this process has been breaking down as member-state expert representatives in comitology committees often abstain from voting, forcing the European Commission to take controversial decisions on its own (and accept any blame for them). In response, the Commission has proposed reforms that would pressure member states to take a position on (and hence political ownership of) controversial regulatory decisions. Impacts Government representatives, interest-group representatives and corporate lobbyists will be most affected by comitology reform. Despite adding transparency and avoiding blame-shifting to Brussels, the reforms would probably not help the EU’s image with citizens. The European Parliament might demand -- as part of any final reform package -- an increase in its involvement in the comitology process.


Subject The organic sector in the EU. Significance UK consumption of organic foods is recovering from sharp reductions experienced during the 2008-09 economic crisis. Across the EU as a whole, consumption was less affected by the downturn, but organic farmers across the bloc face high costs and sometimes aggressive supermarket buying policies. As a result, imports are rising to meet growing demand, raising concerns about labelling and quality controls. Impacts Biogas subsidies could continue to put especial pressure on costs for organic producers in Germany. The German government is likely to pursue measures to help the organic sector, amid producer complaints. European Parliament consideration of the amended organic regulation looks set to be contentious.


Subject The Bratislava summit. Significance Leaders of the EU-27 -- all EU member states except the United Kingdom -- held an 'informal' summit in Bratislava on September 16, aiming to demonstrate their shared resolve to move forward with the integration process in the wake of the Brexit vote. While leaders agreed to a roadmap of policy plans, they skirted around the most divisive issues facing the EU and did not agree on any significant new initiatives. Impacts EU governments again failed to agree to a workable plan to address the migrant crisis, rendering an EU-wide solution increasingly unlikely. Significant agreements on improved security cooperation may not be reached until well into 2017. The EU is likely to block any UK efforts to maintain its current access to the single market without allowing for free movement of workers.


Subject EU responses to Russian actions around Ukraine. Significance EU sanctions imposed in 2014 remain in place owing to continuing concerns about Russian interference in elections, the poison attack on former spy Sergey Skripal and covert Russian activities in Ukraine and elsewhere. However, the EU has resisted pressure to take immediate action after the Kerch Straits incident, in which Russian coast guards captured three Ukrainian naval vessels. Impacts The US position on sanctions currently mirrors EU restraint, but Washington would be forced to act by blatant Russian aggression. Ukraine will call for EU support while using legal action in an attempt to hamper Gazprom's alternative gas export routes. European Parliament resolutions condemning Nord Stream 2 will have little impact on German support for the project.


Sign in / Sign up

Export Citation Format

Share Document