Brussels, 30 April 2021
EU FORMALLY ADOPTS TRADE AGREEMENT WITH UK
This week, the European Parliament and the Council formally adopted the EU-UK Trade and Cooperation Agreement, in what was effectively the last step for the EU in the ratification process. The agreement will enter into force on 1 May and will apply on a permanent basis. But the ramifications of Brexit continue to reach far and wide, reason for which Member States also endorsed the Council’s position on €5 billion Brexit adjustment reserve this week. The fund, designed to mitigate the immediate impact of UK’s withdrawal, will be used to cover economic and societal costs incurred between 1 January 2020 and 31 December 2023 as a result of Brexit.
EU RECOVERY STRATEGY MOVES FORWARD AS COMMISSION RECEIVES NATIONAL PLANS
The Recovery and Resilience Facility (RRF) – the EU’s economic recovery strategy’s flagship initiative – reaches a milestone today as Member States face the deadline for submitting their national recovery and resilience plans to the Commission. Portugal, Germany, Greece, France, and Slovakia already forwarded the documents to the Commission, with Italy, Spain and several others expected to soon follow suit. The Commission has two months upon receiving the plans to decide whether or not to approve them. If approved, the Council will have one month to formally adopt them by means of an Implementing Decision. Only once this process is complete will RRF funds be disbursed.
EU COVID-19 CERTIFICATE STRESSES MEPs’ COMMITMENT TO FREE MOVEMENT AMID COVID
The European Parliament has adopted its negotiating position on the proposal for a certificate aiming to reaffirm the right to free movement in Europe during the pandemic. MEPs agreed that the new “EU COVID-19 certificate” should be in place for 12 months and not longer. The document, which may be in digital or paper format, will attest that a person has been vaccinated against COVID-19 or, alternatively, that they have a recent negative test result or have recovered from the infection. The Parliament and Council are now ready to begin negotiations with the aim to reach an agreement ahead of the start of the summer season.
EUROPEAN PARLIAMENT LAYS OUT PLANS FOR FAIRER TAX SYSTEM FOR THE DIGITAL AGE
The European Parliament adopted a resolution on digital taxation amid discussions on minimum corporate tax at global level. The resolution calls for an international agreement to be reached at the Organisation for Economic Cooperation & Development (OECD) level, expresses support for a minimum effective corporate tax rate and argues that the EU should go it alone if global negotiations at OECD fail. The deadline for agreement at OECD level is June 2021. The Commission has pledged to introduce a proposal for an EU digital levy as an EU own-resource by June 2021 as well.
GREEN LIGHT TO €95 BILLION RESEARCH AND INNOVATION PROGRAMME
The European Parliament adopted the EU’s research and innovation programme for 2021-2027, better known as Horizon Europe. With an overall budget of €95.5 billion, including €5.4 billion from the EU’s Next Generation EU recovery plan, the programme will provide short- and long-term financing for research and innovation relating to global challenges including the fight against climate change, digitalisation, and the COVID-19 pandemic. Horizon Europe was already provisionally put in place by the European Commission from 1 January of this year, but it required the co-legislators’ final approval to be officially adopted. Parliament’s support was nearly unanimous, with 661 votes to 5 and 33 abstentions.
COMING UP NEXT WEEK
Karl Isaksson, Managing Partner Brussels, Kreab