EU Updates - January
Belgium kicks off its EU Council Presidency: Navigating Challenges, Fostering Unity, and Shaping a Resilient Future
At the beginning of January, Belgium assumed the prestigious role of the presidency of the Council of the European Union, succeeding the Spanish presidency and anticipating Hungary. This six-month term holds particular significance as it precedes the European elections scheduled for June 2024.
Belgium's presidency is guided by a comprehensive agenda, encapsulated in six key areas that reflect the pressing challenges and opportunities facing the European Union.
Firstly, the presidency places a strong emphasis on defending the rule of law, democracy, and unity. Focusing on fundamental rights, the rule of law, and democratic values, Belgium aims to empower citizens, particularly through initiatives targeting youth participation, education, and media freedom.
Secondly, the agenda prioritizes strengthening competitiveness, with a focus on long-term industrial policies to ensure a level playing field for businesses, especially small and medium-sized enterprises (SMEs). The presidency is committed to building a sustainable, innovative, and resilient digital ecosystem.
In line with the EU's Green Deal, the third key area involves pursuing a green and just transition. Belgium is committed to accelerating the inclusive energy transition, promoting renewable energy sources, and addressing climate change, biodiversity loss, and pollution.
The fourth area underscores reinforcing the social and health agenda, building on the European Pillar of Social Rights. Initiatives include strengthening social dialogue, fair labor mobility, and social protection, along with a focus on crisis preparedness and health workforce strategy.
Addressing the pressing issue of migration, the fifth priority involves protecting people and borders. Belgium aims to enhance trust and legal clarity in managing migration, extending efforts to strengthen the external dimension of migration and asylum, especially with African partners.
Lastly, the presidency focuses on promoting a global Europe. It emphasizes a more assertive approach to foreign policy, highlighting openness, dialogue, and cooperation. Belgium aims to uphold EU interests and values on the global stage through economic, security, defense, and humanitarian capabilities.
Looking ahead, the Belgian Presidency holds particular relevance as it coincides with crucial developments in EU legislation. The Forced Labour Regulation, which aims to combat forced labor, ensuring ethical business practices, is set to be finalized in Q1/Q2 2024. Simultaneously, the Corporate Sustainability Due Diligence Directive is slated for inclusion in the Official Journal of the European Union in the first half of the year.
In conclusion, as the Belgian presidency unfolds, it is set to play a crucial role in shaping the EU's path forward, fostering unity, resilience, and global cooperation.
For more information:
Contact Giorgia Miccoli, EU Affairs Senior Specialist
The EU Advances on Corporate Sustainability: Key Highlights of the New Due Diligence Directive
On December 13, the European Parliament and the European Council tentatively agreed on the Corporate Sustainability Due Diligence Directive, marking a significant stride in promoting responsible business practices. Pending approvals from the Legal Affairs Committee, the full European Parliament, and the EU Council, the directive is poised to take effect by February 2024.
The directive, with a broad scope covering EU and non-EU companies meeting specific criteria, introduces several pivotal elements.
Notably, a risk-based due diligence framework aims to ensure respect for human rights and the environment throughout business operations and supply chains.
The directive mandates companies to integrate due diligence into their policies, identify potential adverse impacts, and take preventive measures, including engagement with affected parties.
Financial institutions, although initially excluded from a fuller version of the requirements, will be asked to align with the decarbonization goals of the Paris Agreement.
The directive establishes independent supervisory authorities at the member state level with the power to inspect, investigate, and impose penalties for non-compliance, including fines up to 5% of net worldwide turnover.
Companies will face civil liability for breaching due diligence obligations, providing victims, including trade unions and civil society organizations, the right to compensation.
To facilitate compliance, due diligence will factor into award criteria for public contracts.
As a supportive measure, national governments will create tools and portals to assist companies in fulfilling their due diligence obligations effectively.
In summary, the Corporate Sustainability Due Diligence Directive signifies a transformative shift in the EU, promoting ethical business practices. While this represents only a first step forward, it highlights a robust commitment to sustainable and accountable corporate behavior.
Moving forward, the EP's Legal Affairs (JURI) Committee is expected to vote on the agreement in February, and formal adoption of the provisional agreement by the EP and Council is still pending.
For more information:
Contact Giorgia Miccoli, EU Affairs Senior Specialist
The EU Takes Major Steps Forward for a Regulation to Ban Products Made with Forced Labor
On October 26th, the European Parliament's Committee on International Trade and the Committee on the Internal Market and Consumer Protection endorsed a report on the proposed regulation to ban products made with forced labor from the Union market.
The report suggests that:
the scope should be expanded to include packaging, transportation, and distribution.
Measures for victim remediation should be included.
High-risk products from specific regions would be presumed in violation, with operators bearing the burden of disproving such presumption.
Guidelines on due diligence, stakeholder engagement, and penalties should be issued within 12 months.
The Union Network Against Forced Labour Products should be set and coordinated by the Commission, focusing on joint enforcement and capacity-building activities.
The Commission should evaluate and review the regulation's impact every four years, assessing the potential enlargement of its scope.
In December, EU ministers deliberated on the proposal, emphasizing heightened Commission involvement for more effective implementation and enforcement. Responding to concerns raised by the Spanish Presidency, the Commission has proposed a nuanced approach involving both Commission and Member State collaboration, blending decentralized enforcement with central EU-level coordination.
Building on this, Member States' Ambassadors are expected to adopt a negotiating mandate shortly, paving the way for interinstitutional negotiations with the European Parliament upon approval.
In summary, the EU is determined to stop forced labor in its markets, aiming for a finalized agreement on the proposal by May 2024. This effort aligns with the Corporate Sustainability Due Diligence Directive's goal to make fair working conditions a core value for EU businesses globally.
For more information:
Giorgia Miccoli, EU Affairs Senior Specialist
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