Philip Morris, world leader in the tobacco market, is the company that in 2013 spent the most for lobbying at European level, with its 5.25 million Euros. A short distance away, there are two other American companies: the oil and gas corporation ExxonMobil (5), and Microsoft, major of the computer industry, with 4.75 million. To report these data the new website www.lobbyfacts.eu, born by a collaboration between three NGOs that deal with transparency and fight against corruption at European level: LobbyControl, Corporate Europe Observatory and Friends of the Earth – Europe[1].
Regarding the corporate sector, the European Cemafroid, Shell, Siemens and GDF Suez are the other “top spender” for lobbying in Europe. Right afterwards, there is the first Asian, the Chinese Huawei (eleventh place with 3 million expenditure), while the first Italian is Gruppo Alcuni, involved in the production of theatrical and television shows for children, at a cost varying from 1, 7 to 2 million Euros. Gruppo Alcuni spent more than the first Russian in the ranking, Gazprom, with a cost of about 1.2 million[2].
The amounts spent by representative trade associations are even higher: the Association for Financial Markets in Europe (headquartered in the UK) invests 10 million Euros in lobbying; the European Chemical Industry Council, headquartered in Belgium, is investing 5.9 million; ANIA, the French Association of Food Industries, spends about 5 million dollars. The first Italian is the APT (Associazione Produttori Televisivi), with a cost of 1.5 million. Consulting firms come to spend lots of money as well: about 10 million by the Belgian Beiten Burkhadt and British Bird & Bird.
We could find this data on the Transparency Register of the European Union, the EU’s main instrument intended to regulate lobbying activities. The Register[3] has to include all those who want to hold relationships within the European institutions. The Parliament and the Commission, Institutions that have already provided compulsory registration respectively since 1996 and 2008, established it in 2011. The Register, however, presents positive and negative aspects. The incentive to register is given by the opportunity for the members to receive notices by decisional organs in advance (such as the Directorate-Generals and the working groups of the Commission, the specialized committees and intergroup of the European Parliament, the Committees of the Council and of the Councils of Ministers of the European Union), but registration is not mandatory. The non-mandatory nature is clearly a weakness of the Register, which does not allow to fully understanding the activity of institutional relations by the big social group and economic ones in Europe. On the contrary, it is possible for the regulation in Great Britain, Canada and the United States.
Other instruments used by the EU Institutions are the Codes of Conduct of Commission and the Parliament. The codes of conduct would allow (if properly implemented) greater transparency from European decision-makers and, in particular, would limit the phenomenon of so-called “revolving doors”, i.e. when an elected at European Parliament or an official of the European Commission passes “on the other side” to represent corporate interests. All these tools would avoid scandals like the one involving the former health commissioner John Dalli (the so-called “Dalligate”). This Maltese commissioner, through contact with a fellow countryman, accepted to obtain illicit financial benefits from the Swedish firm “Swedish Match”, which would have got a favorable legislation on trade in chewing tobacco, on which he had a competitive advantage[4], in exchange. European Anti-Fraud service OLAF quickly unmasked the operation.
Today, European Transparency Register counts 6,000 registered[5], but the data is not actually photographing the volume and quality of investments in lobbying in Europe. For example, if we consider the subjects enrolled per country in the Register[6], we can see that approximately 1,600 of them are based in Belgium, but not all interests are Belgian, but only have headquarter there (800 for Germany and 600 for Italy). In this case, data collected by NGOs such as Transparency International, LobbyControl or ALTER-EU (Alliance for Lobbying Transparency and Ethics Regulation in Europe) are mixed but uncertain in any case.
Recently the “lobbying question” also involved the debate about the designation of new members of the European Commission, in particular the Commissioner for Finance Hill. The British politician has a past as a lobbyist, because he worked for consulting firms such as Lowe Bell Communications and Bell Pottinger, before founding Quiller Consultants[7]. But Hill was also a powerful member of the British Conservative Party, elected leader of the House of Lords in 2012. The controversies mounted when Hill refused to answer some questions from members of Parliament during the usual hearings held prior to his designation as Commissioner. In particular, one of the dark sides of Hill is having repeatedly crossed the “revolving door” moving from politician to lobbyist, which would make his designation “the wrong signal when European policies are dominated by large financial lobbies”[8]. It is not the first time that a second hearing was necessary to appoint a commissioner: Swedish Malmstroem, Spaniard Canete, Hungarian Navracsics and Slovenian Bratusek have been postponed, too.
One of the main questions is: how much does lobbyists influence on European decision-making processes? The data, needless to say, are not sure, since it is not mandatory for lobbies to declare how much is spent and how to influence a public decision-maker, nor it is mandatory for the politician or officer to declare how many meetings have been with lobbyists or the amount of any donations to the campaign. However, it can be possible to know how lobbies influence a market or sector according to the measures approved and implemented by the European institutions.
In particular, many people have considered “financial lobby” in Brussels as “the world’s most powerful”. A study[9] by Corporate Europe Observatory has drawn that the financial world (which includes, for example, big groups such as JP Morgan, Goldman Sachs International, Deutsche Bank, Citigroup) exceeds spending on lobbying than any other group of interest by a factor of 30 to 1. For example, in a recent discussion in the European Parliament, about a Directive on hedge funds and private equity, financial lobbyists drafted 900 amendments on a total of 1,700 directly instead of MEPs[10]. Another very influential lobby power is the ICT sector: the major OTT (“over-the-top”) companies, such as Facebook, Google, Microsoft, Yahoo, Ebay, in 2012 spent about 10.7 million in lobbying activities[11]. It is also important the activity of the tobacco companies (particularly active in 2012, during the process of preparation and implementation of the Directive dedicated to them[12]), the chemical, food, pharmaceutical and nuclear power, but also the advocacy activities carried out by environmental NGOs. Lobbying is fundamental, too, for the so-called TTIP, the Transatlantic Trade and Investment Partnership, a controversial deal between the United States and the European Union. This measure would create 13 million jobs according to the study center of the White House[13]. It would also bring about 3,700 billion € of investment, + 545€ a year for European families (0.5% of GDP) and an increase of about one-third of European imports from the United States (taken from a survey by the Center for Economic and Policy Research of London[14]) thanks to the US-EU bilateral relations.
Lobbying is one of the distinctive features of the European decision-making: the institutional relations are crucial to move a mechanism composed of dozens of institutions and bodies, 28 national delegations with their MPs and officials who speak many different languages and especially representing hundreds of different interests. Today the European model, though far from the American one (where the lobbying is born and it is a constitutional right, contained in the First Amendment to the Constitution dated 1791) is a step towards greater transparency of the institutions. It is also an example for several European countries (including, to cite cases in which the debate is more recent, Italy, Spain[15] and Hungary[16]) that want to regulate a phenomenon affecting the fiscal and industrial policies of governments and is more and more central in the organization of medium and large enterprises.
Giovanni Gatto
Master in Institutional Relations, Lobbying and Business Communications (LUISS “Guido Carli”)
[1] J. Crisp, Philip Morris tops NGOs’ lobbying spending table, “EurActiv”, October 1, 2014.
[4] Anon., Scandalo tabacchi, si dimette il commissario Ue John Dalli, “La Stampa”, October 16, 2012.
[5] N. Nielsen, EU transparency register nears 6,000 entrants, “EUobserver”, February 12, 2013.
[7] R. Mason, Lord Jonathan Hill of Oareford: from Lord Who? to EU commissioner, “The Guardian”, September 10, 2014.
[8] Anon., Hill refuses to give MEPs details on his past as a lobbyist, “Corporate Europe Observatory”, October 7, 2014.
[10] A. Baranes, La lobby più potente del mondo, “Huffington Post”, April 9, 2014.
[11] P. Licata, Ott, così le super-lobby fanno pressing su Bruxelles, “Corriere comunicazioni”, June 28, 2013.
[12] Anon., Mapping the tobacco lobby in Brussels: a smoky business, “Corporate Europe Observatory”, November 6, 2012.
[15] G. Gatto, Spagna, il 93% dei lobbisti richiede la regolamentazione della propria attività. E in Italia?, “LobbyingItalia”, October 3, 2014.
[16] G. Sgueo, Le lobby (opache) d’Ungheria, “LobbyingItalia”, September 24, 2014.
