Corporate capture of EU member-states in Brussels ‘very high’ and ‘getting worse’, think-tank finds

‘Captured States: When EU Governments are a channel for corporate interests’ challenges “nationalist rhetoric” which sees “blaming the EU ‘appartus’ alone” as a sufficient explanation of EU corporate power

  • Report finds member-states exert substantial influence at EU level, but that corporate lobbyists are “really dominant” over how that influence is exercised
  • There is a number of mechanisms by which corporate lobbyists exert control, with a “massive asymmetry of influence” leading to an “accountability and democratic deficit”
  • Report makes a series of recommendations for how to address this, including at national level, EU level and through increased citizen participation

A NEW report by a European think-tank has found that the dominance of corporate lobbying interests over EU member states in EU decision making is “very high” and “getting worse”.

The report, 'Captured States: When EU Governments are a channel for corporate interests’, by the Corporate Europe Observatory challenges “nationalist rhetoric”, arguing that “blaming the EU ‘apparatus’ alone” for the domination of corporations over EU policy “is far too simplistic”, with governments exercising substantial influence over decisions. However, that influence tends to be refracted through “really dominant” corporate lobbying.

“Too often, member state governments, acting individually or collectively, are a bastion of corporate influence on EU decision-making,” the report states. “The risk of corporate capture of some member states, on some EU dossiers, is very high, undermining democracy and the public interest. And it is getting worse.”

States become captured at three levels of EU decision-making: The Council of the European Union (where states’ input into EU law making and policy), the European Council (where heads of government meet for summits) and the EU’s committee structure (giving member states’ a seat at the table over the detail of law-making).

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‘Captured States’ finds that multinationals exert dominance over member state decision making through a number of mechanisms, including:

  • Elite corporate lobbies, which have “access that NGOs and trade unions cannot match”, for example the European round table of industrialists, which brings together 50 heads of big business across Europe with the EU Commission President, the President of France and Chancellor of Germany.
  • Rotating Presidencies of the Council of the EU, which provide a “key target” for lobbying influence, with “corporate sponsorship of rotating presidencies” now appearing to be “standard”.
  • The Committee Structure is “complex and opaque”, benefiting corporate lobbies which have the resources and reach to dominate the legalistic and technocrat goings on of the committees work.
  • The lobbying consultancy firms eco-system in Brussels, which provides a range of services to big business specifically aimed at influencing member states. The data backs up the extent of this influence: “The Dutch Permanent Representation’s officials held over 500 lobby meetings between June 2017 and 2018 and 73 per cent of these were with business interests, and only 15 per cent with NGOs or trade unions.”

The result of this is “a massive asymmetry of influence on member states’ EU-decision making” to the extent that “member states and national corporate lobbies have developed a symbiotic relationship whereby the national corporate interest has – wholly wrongly – become synonymous with the national public interest as presented by the relevant government in EU fora”. 

The combination of factors driving this asymmetry, including a lack of transparency and “exclusion of citizens in decision making at national level”, has created a “accountability and democratic deficit”.

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The report provides a case study on the City of London specifically, which it says is “notoriously powerful with considerable influence over decision-makers in both London and Brussels”, highlighting a series of examples by which the City has successfully lobbied the UK state - whether it be via MEPs or heads of state - to quash attempts to increase financial regulation across the EU.

Four key recommendations are made to address the problem of captures states:

  1. Member state governments themselves should establish national rules to prevent privileged access for corporations to influence EU decision-making.
  1. Member state parliamentary scrutiny should be established, with pre-decision scrutiny and post-decision accountability in place.
  2. The democratic deficit in EU institutions would need to be tackled through EU level reforms of the Council of the EU, the European Council and the committee process.
  3. New models for citizens to find out more and have a say, which could include participatory hearings and on-line consultations

Picture courtesy of Friends of Europe

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