EU Insight, 17 July 2020

SPECIAL EUROPEAN COUNCIL MEETING, 17-18 JULY

EU leaders are currently discussing new proposals for the COVID-19 EU recovery plan and Multiannual Financial Framework for 2021-2027, in a two-day EU Council summit. Lengthy discussions are anticipated, and an additional summit at the end of July may be required to continue discussions. There is currently a lack of consensus on the size of the budget and the recovery fund, rebates, shares of loans and grants, the allocation of the Recovery and Resilience Facility, and also the governance and conditionality of receipt of funds.

COMMISSION STRENGTHENS PREPAREDNESS FOR FUTURE VIRUS OUTBREAKS

The Commission presented a Communication laying out immediate short-term measures to strengthen Europe’s preparedness for future outbreaks of COVID-19. The preparedness measures include testing and contact tracing, improved public health surveillance, and enhanced access and supply of personal protective equipment, medicines and medical devices. Additionally, the Communication sets out measures to control healthcare capacity fluctuations, non-pharmaceutical countermeasures, support to minorities and vulnerable persons, and activities to reduce the burden of seasonal influenza. Also, to improve cross-border contract tracing capabilities, the Commission adopted an Implementing Decision to support interoperability of mobile tracing and warning apps.

COMMISSION PROPOSES NEW TAXATION PACKAGE

This week the Commission adopted a new Tax Package, aiming to ensure EU tax policy supports the COVID-19 recovery strategy. The package consists of three initiatives. Firstly, the Tax Action Plan presents 25 actions to make taxation simpler, fairer and better. Secondly, the proposal on administrative cooperation extends EU tax transparency regulations to digital platforms, ensuring that Member States automatically exchange data on online platform revenues. Thirdly, the Communication on tax good governance aims to curb unfair tax competition, in the EU and globally, and recommends changes to the Code of Conduct, which addresses distortive tax practice and tax competition.

COMMISSION LAUNCHES SECTOR INQUIRY INTO THE CONSUMER INTERNET OF THINGS

The Commission launched an antitrust sector inquiry into the Internet of Things (IoT) sector for products and services which are “connected to a network and can be controlled at a distance.” These can include smart watches, smart appliances or fitness trackers for example. The intention is to shed light on competition distortions that could eventuate in this rapidly growing sector. The Commission will assess market data and if competition issues emerge, it may open case investigations to ensure compliance with EU competition rules. A preliminary consultation report is expected for Spring 2021, followed by the final report in summer 2022.

TRAVEL RESTRICTIONS LIST UPDATED

The EU Council updated its list of countries for which Member States may start lifting current travel restrictions from non-EU countries. Criteria used include the epidemiological situation, containment measures, and economic and social considerations. The updated list amends the initial list published on 30 June 2020 and now recommends the gradual lifting of travel restrictions for residents from Algeria, Australia, Canada, Georgia, Japan, Morocco, New Zealand, Rwanda, South Korea, Thailand, Tunisia, and Uruguay. China will be included provided there is reciprocity. The list will be reviewed fortnightly and potentially updated after consultation with the Commission and relevant EU agencies.

 WE WISH YOU A SUNNY AND RELAXING SUMMER! THE EU INSIGHT WILL BE BACK AT THE END OF AUGUST.

 COMING UP NEXT WEEK

• 17-18 July: Special European Council. On the agenda: the COVID-19 recovery plan and a new long-term EU budget under the multiannual financial framework (MFF).
• 20 July: Agriculture and Fisheries Council.
• 20-23 July: Sixth round of EU-UK Future Relationship negotiations (London).
• 21-22 July: Informal meetings of research ministers.
• 22 July: Conference of Presidents of the European Parliament.

 Karl Isaksson, Managing Partner Brussels, Kreab