Insights | EU Insight, 8 March 2024

11/03/2024

EU Insight, 8 March 2024

Brussels, 8 March 2024

 

NEW EUROPEAN DEFENCE INDUSTRIAL STRATEGY

Aiming to respond to increasing pressure fuelled on one side by the raging war in Ukraine, and on the other by the uncertainty of the US’ role in NATO, should Trump emerge victorious in this year’s elections, the Commission unveiled its new European Defence Industrial Strategy and Industry Programme. Concretely, the Strategy puts forward a set of actions to support the competitiveness and readiness of the EU defence industry. The Commission proposes to mobilise EUR 1.5 billion between 2025 and 2027 to increase manufacturing capacities and open supply chains for better cross-border cooperation and incentivising cooperation in standardisation and defence procurement.

 

AGREEMENT TO BAN PRODUCTS MADE WITH FORCED LABOUR

In a move signalling the EU’s championing of human rights, the European Parliament and the Council agreed on new rules that aim to ban products made with forced labour from EU markets. Notably, the agreement empowers Member States and the Commission to investigate instances where supply chains are suspected of incorporating forced labour. In cases of violation, products will have to be withdrawn from EU markets, until remediation. Accordingly, firms failing to comply with the rules face fines. Aiming to facilitate the enforcement of the rules, the initiative establishes a list of high-risk economic sectors and geographic areas, particularly susceptible to forced labour, and introduces a set of digital tools.

 

LANDMARK DEAL REACHED TO FOSTER SUSTAINABLE PACKAGING

The European Parliament and the Council reached an agreement to enhance the sustainability of packaging and curbing related waste in the EU. The law will introduce new rules to limit the amount of packaging used in the first place, as well as fostering the re-use and re-cycling of packaging. For example, the rules set targets for recycled content in plastic packaging and introduces measures to reduce unnecessary packaging, including limiting empty space and minimizing weight and volume. The agreement also mandates binding re-use targets, prohibits “forever chemicals” in food packaging and introduces refill obligations, along with requirements for deposit return systems, thus having a large impact on the food and beverages take-away sector, amongst others.

 

DESIGNATED GATEKEEPERS MUST NOW FULLY COMPLY WITH THE DMA

In September 2023, the Commission designated six companies as ‘gatekeepers’ under the Digital Markets Act (DMA), namely, Apple, Alphabet, Meta, Amazon, Microsoft and ByteDance. Having a significant control over the access of sections of digital markets, the DMA aims to ensure fair practices to prevent gatekeepers from imposing unfair market conditions. Amongst others, this includes restricting third parties’ access to their platforms. As such, following their designation in September, the six companies had until yesterday, 7 March, to be fully compliant with the DMA’s requirements. Moving forward, the six companies will have to provide detailed reports of their compliance, which will be carefully monitored by the Commission.

 

EXTENSION OF COORDINATED GAS DEMAND REDUCTION MEASURES

The Council agreed to extend the application of gas demand reduction measures, originally introduced in autumn 2022 at the height of the energy crisis. Overall, the measures urge Member States to reduce their gas consumption by 15% until March 2025, aiming to prevent supply disruptions and excessive price volatility. The Council’s adoption follows a recommendation from the Commission, who found that despite significant improvements since 2022, global gas markets remain susceptible to instability and disruptions, which could lead to renewed price spikes. As such, the extension of the measures aims to ensure ample supplies for next winter and bridge the gap until other related energy legislation applies in early 2025.

 

COMING UP NEXT WEEK

  • 11 – 14 March: European Parliament Plenary Session in Strasbourg. On the agenda: Cyber Resilience, Green Claims, AI Act, European Media Freedom and Animal Welfare.
  • 11 March: Eurogroup. On the agenda: Macroeconomic developments and fiscal policy in the euro area in 2025, and a Statement on the future of the Capital Markets Union.
  • 11 March: Employment, Social Policy, Health and Consumer Affairs Council. On the agenda: Platform work, European Semester, Youth Guarantee, Investments and reforms.
  • 12 March: Economic and Financial Affairs Council. On the agenda: Recovery and Resilience Facility, Russia/Ukraine, G20 follow-up, EU budget and financial services.
  • 13 March: The Governing Council of the European Central Bank (ECB). On the agenda: non-monetary policy meeting

 

Karl Isaksson, Managing Partner Brussels, Kreab

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Kreab • Tel: +32 2 737 6900 • karl.isaksson@kreab.comwww.kreab.com/brussels • Twitter: @KreabEU.