COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT REPORT Accompanying the document Proposal for a Directive of the European Parliament and of the Council establishing harmonised requirements in the internal market on transparency of interest representation carried out on behalf of third countries and amending Directive (EU) 2019/1937 and Proposal for a Regulation of the European Parliament and of the Council amending Regulations (EU) No 1024/2012 and (EU) 2018/1724 as regards certain requirements laid down by Directive (EU) XXXX/XXXX

EN EN
EUROPEAN
COMMISSION
Strasbourg, 12.12.2023
SWD(2023) 663 final
COMMISSION STAFF WORKING DOCUMENT
IMPACT ASSESSMENT REPORT
Accompanying the document
Proposal for a Directive of the European Parliament and of the Council
establishing harmonised requirements in the internal market on transparency of interest
representation carried out on behalf of third countries and amending Directive (EU)
2019/1937
and
Proposal for a Regulation of the European Parliament and of the Council
amending Regulations (EU) No 1024/2012 and (EU) 2018/1724 as regards certain
requirements laid down by Directive (EU) XXXX/XXXX
{COM(2023) 637 final} - {SEC(2023) 637 final} - {SWD(2023) 660 final} -
{SWD(2023) 664 final}
Offentligt
KOM (2023) 0637 - SWD-dokument
Europaudvalget 2023
i
Table of content
1. INTRODUCTION: POLITICAL AND LEGAL CONTEXT...............................................5
2. WHAT IS THE PROBLEM AND WHY IT IS A PROBLEM?...........................................9
2.1. What are the problems?..............................................................................................9
2.1.1. Obstacles to the internal market for interest representation activities carried out on
behalf of third countries..........................................................................................9
2.1.2. Unknown magnitude, trends and actors of interest representation activities carried
out on behalf of third countries.............................................................................12
2.2. Magnitude of the problems.......................................................................................15
2.3. How will the problems evolve?................................................................................16
3. WHY SHOULD THE EU ACT? ........................................................................................17
3.1. Legal basis................................................................................................................17
3.2. Subsidiarity: Necessity and added value of the EU action.......................................19
4. OBJECTIVES: WHAT IS TO BE ACHIEVED?...............................................................21
4.1. General objectives ....................................................................................................21
4.2. Specific objectives....................................................................................................21
5. WHAT ARE THE AVAILABLE POLICY OPTIONS? ....................................................21
5.1. What is the baseline from which policy options are assessed? ................................21
5.2. Scope of the policy intervention...............................................................................22
5.2.1. Option A ...............................................................................................................23
5.2.2. Option B................................................................................................................24
5.2.3. Option C................................................................................................................24
5.2.4. Other possible scope.............................................................................................24
5.2.4.1. Interest representation carried out on behalf of any government or entity.24
5.2.4.2. Exclusion of some entities from the scope .................................................25
5.3. Description of the policy options .............................................................................26
5.3.1. Policy Option 1: Non-legislative measures...........................................................29
5.3.2. Policy Option 2: Legislative intervention.............................................................30
5.3.2.1. Policy Option 2.1: Targeted requirements..................................................30
5.3.2.2. Policy Option 2.2: Extended requirement ..................................................33
6. WHAT ARE THE IMPACTS OF THE POLICY OPTIONS?...........................................34
6.1. The baseline scenario ...............................................................................................34
6.2. Assessment of the options ........................................................................................35
6.2.1. Economic impacts.................................................................................................35
6.2.1.1. Functioning of the internal market .............................................................35
6.2.1.2. Competitiveness .........................................................................................36
6.2.1.3. Costs and administrative burdens for economic actors (+SMEs)...............37
6.2.1.4. Costs for public authorities of measures addressed to economic actors.....39
6.2.2. Social impacts.......................................................................................................40
6.2.2.1. Transparency of interest representation activities carried out on behalf of
third countries.............................................................................................40
ii
6.2.2.2. Improve knowledge about the magnitude, trends and actors of interest
representation activities carried out on behalf of third countries................41
6.2.2.3. Enforcement and supervision by authorities...............................................41
6.2.3. Fundamental rights impacts..................................................................................43
6.2.3.1. Right to private life and to the protection of personal data ........................43
6.2.3.2. Freedom of association...............................................................................44
6.2.3.3. Freedom of the arts and sciences................................................................47
6.2.3.4. Freedom of expression and information.....................................................48
6.2.3.5. Freedom to conduct a business...................................................................49
6.2.4. Geopolitical implications......................................................................................49
6.2.5. Digital by default principle...................................................................................53
7. HOW DO THE OPTIONS COMPARE?............................................................................54
7.1. Effectiveness ............................................................................................................55
7.2. Efficiency .................................................................................................................55
7.3. Coherence with other EU initiatives.........................................................................56
7.4. Proportionality..........................................................................................................60
7.5. Comparison of options .............................................................................................60
8. PREFERRED OPTION ......................................................................................................61
8.1. Description of the preferred option ..........................................................................60
8.2. The choice of instrument..........................................................................................61
8.3. Application of the “one in, one out” approach.........................................................62
9. HOW WILL ACTUAL IMPACTS BE MONITORED AND EVALUATED? .................62
ANNEX 1: PROCEDURAL INFORMATION...........................................................................65
ANNEX 2: STAKEHOLDER CONSULTATIONS ...................................................................69
ANNEX 3: WHO IS AFFECTED AND HOW? .........................................................................89
ANNEX 4: ANALYTICAL METHODS ....................................................................................96
ANNEX 5: COMPETITIVENESS CHECK..............................................................................143
ANNEX 6: EVIDENCE OF CURRENT AND POTENTIAL FUTURE FRAGMENTATION IN
THE REGULATION OF INTEREST REPRESENTATION ACTIVITIES ACROSS THE
INTERNAL MARKET.....................................................................................................144
ANNEX 7: ANALYSIS OF ADMINISTRATIVE FINES AND THRESHOLDS FOR
INFORMATION REQUESTS..........................................................................................162
ANNEX 8: FUNDAMENTAL RIGHTS IMPACT...................................................................168
ANNEX 9: THE BASELINE ....................................................................................................174
iii
Glossary and acronyms
Term or acronym Meaning
Actions on behalf of
third countries
Actions that can ultimately be attributed to a central government or
public authorities of a country. It would cover situations where a
government is behind the decision of another entity to have interest
representation activities carried out on its behalf, in particular by
giving instructions or directives to that entity1
. It would also cover
entities that are controlled2
by the government or a public authority3
.
AVMSD Audiovisual Media Services Directive
CER Directive Critical Entities Resilience Directive
CFSP Common Foreign and Security Policy
Civil society
organisation (CSO)
Non-governmental organisations and institutions of civil society,
active in the field of fundamental rights, which are voluntary self-
governing bodies or organisations established to pursue the essentially
non-profit-making objectives of their founders or members.4
DSA Digital Services Act
ECNE European Cooperation Network on Elections
EMFA European Media Freedom Act
FDI Foreign direct investment
FIMI Foreign information manipulation and interference
Foreign influence Intervention by third country governments to influence the democratic
sphere including legislation and policies, also by shaping public
opinion in a way which benefits their interests.
Foreign interference Foreign interference is used to differentiate between influencing
activities that are integral to diplomatic relations and activities that are
carried out by, or on behalf of, a foreign state-level actor, which are
coercive, covert, deceptive, or corrupting and are contrary to the
sovereignty, values, and interests of the Union.5
1
This would cover instructions by the government, though directives or legal requirements.
2
A government or a public authority would control an entity carrying interest representation where through economic rights,
contractual arrangements, or any other means, either separately or combination confer the possibility of exercising decisive
influence on that entity.
3
Based on Article 3(3) of Regulation (EU) 2022/2560 of the European Parliament and of the Council of 14 December 2022
on foreign subsidies distorting the internal market.
4
See Article 10 of Council Regulation (EC) No 168/2007 establishing a European Union Agency for Fundamental Rights
and the Council of Europe Recommendation CM/Rec(2007)14 of the Committee of Ministers to member states on the
legal status of non-governmental organisations in Europe.
5
There is no common definition of foreign interference in EU law. Furthermore, no common definition exists in academia.
In order to ensure consistency with recent EU publications, the definition is based on the definition used in the Commission
Staff Working Document on Tackling Research and Innovation foreign interference (European Commission, Directorate-
General for Research and Innovation, Tackling R&I foreign interference – Staff working document, Publications Office
of the European Union, 2022, https://data.europa.eu/doi/10.2777/513746). This definition uses elements from the
iv
GDPR General Data Protection Regulation
IMI system Internal Market Information System
Interest
representation
Interest representation means an activity conducted with the objective
of influencing the development, formulation or implementation of
policy or legislation, or public decision-making processes in the
Union.
It covers a broad range of activities. It would include both activities
that aim to influence public decision-making both directly (e.g. direct
engagements with public officials) and indirectly (e.g. the
dissemination of research outputs, the organisation of and
participation in conferences / events, and the provision of education,
training and cultural engagement, when performed with the same
objective).
NGO Non-governmental organisation
OECD Organisation for Economic Co-operation and Development
OSCE Organization for Security and Co-operation in Europe
Public Official Member States and Union officials.
TEU Treaty on European Union
TFEU Treaty on the Functioning of the European Union
Third country Countries outside of the European Economic Area (EEA).
Third country entity The central government and public authorities at all other levels of a
third country as well as a public or private entity whose actions can
be attributed to such central government or public authorities.
Australian foreign interference legislation which is often used as a reference when defining foreign interference (i.e. that
foreign interference is by nature coercive, covert, deceptive, or corrupting, 'Foreign Influence Transparency Scheme’,
Australian Government, available at: https://www.ag.gov.au/integrity/foreign-influence-transparency-scheme.).
Additionally, the definition was complemented by an extract from a briefing by the European Parliament’s Research
Service on “Lobbying and foreign influence”, which clarifies that foreign interference is different form legitimate
influencing activities that are integral to diplomatic relations (European Parliamentary Research Service, Lobbying and
foreign influence, 2021, https://www.europarl.europa.eu/thinktank/mt/document/EPRS_BRI(2021)698754).
5
1. INTRODUCTION: POLITICAL AND LEGAL CONTEXT
Together with the rule of law and fundamental rights, democracy is a founding value of the
European Union. For democracy to function well, citizens must be able to express their
preferences and elect their representatives freely.
One important characteristic of democratic systems is that stakeholders, citizens and civil
society organisations (CSOs), are consulted and involved in the preparation of laws and
policies on the basis of transparent processes, at European, national, regional and local levels.
The space for public debate in Europe is and must remain open, also to ideas from across the
world6
.
There is a growing concern that the openness of European societies is being exploited for covert
interference7
from foreign governments to manipulate decision-making processes and public
opinion in the EU. The European Parliament8
and the Council9
have underlined the importance
of addressing the threat to democracy posed by such covert foreign interference.
Governments10
, citizens11
and civil society organisations12
are concerned by the impact of such
external interference on European democracies and the public sphere. For example, a recent
Flash Eurobarometer survey on Citizenship and Democracy found that about 8 in 10 Europeans
agree that foreign interference in European democratic systems is a serious problem that should
be addressed13
. Concerns have intensified after Russia’s war of aggression against Ukraine and
the so-called “Qatar-gate”, a corruption scandal involving Members of the European
Parliament and EU staff. The Union witnessed numerous instances of some third countries
seeking to covertly influence in its politics and decision-making14
. While the full scale of this
phenomenon is unknown, reports of such activities exist15
.
‘A new push for European democracy’ is a headline priority of the Commission and many
initiatives have been adopted over recent years, including in the framework of the European
Democracy Action Plan16
presented in 2020, that put forward a comprehensive approach to
‘empower citizens and build more resilient democracies across the EU’. Existing policy
6
Communication on a Global Approach to Research and Innovation, COM(2021) 252 final.
7
The term ‘foreign interference’ is defined in the glossary. For more information on this see Annex G of the supporting
study.
8
Since 2019, the European Parliament established two Special Committees INGE and INGE2 on foreign interference in all
democratic processes in the European Union, including disinformation, and the strengthening of integrity, transparency
and accountability in the European Parliament that adopted resolutions in this area. See European Parliament resolution of
9 March 2022 on foreign interference in all democratic processes in the European Union, including disinformation
(2020/2268(INI)), European Parliament resolution of 13 July 2023 on recommendations for reform of European
Parliament’s rules on transparency, integrity, accountability and anti-corruption (2023/2034(INI)), European Parliament
resolution of 1 June 2023 on foreign interference in all democratic processes in the European Union, including
disinformation (2022/2075(INI)).
9
Council Conclusions “Complementary efforts to enhance resilience and counter hybrid threats”, 10 December 2019,
14972/19; Council conclusion “Global approach to Research and Innovation - Europe's strategy for international
cooperation in a changing world”, 28 September 2021, 12301/21; Council conclusions “on Foreign Information
Manipulation and Interference (FIMI)”, 18 July 2022, 11173/22.
10
See various consultations with Member States detailed in Annex 2, for example the focus group meeting with Member
State authorities of 30 March 2023 and the focus group meeting with local authorities of 28 March 2023.
11
See Flash Eurobarometer 528 on Citizenship and Democracy, and Flash Eurobarometer 522 on Democracy.
12
See various consultations with CSOs detailed in Annex 2, for example the focus group meeting with CSOs of 14 February
2023 and the focus group meeting with CIV grants beneficiaries working on projects related to the 2024 European
Parliament elections of 1 March 2023.
13
See Flash Eurobarometer 528 on Citizenship and Democracy.
14
See note 8.
15
See supporting study. See also “The landscape of Hybrid Threats: A Conceptual Model”, Giannopoulos, G., Smith, H. and
Theocharidou, M. editor(s), Publications Office of the European Union, Luxembourg, 2021.
16
Communication on the European Democracy Action Plan, COM/2020/790 final.
6
interventions include updating rules governing European political parties and foundations17
,
regulating various aspects of online platforms18
, addressing disinformation19
, detecting,
analysing and countering foreign information manipulation and interference (FIMI)20
,
regulating political advertising including on social media21
, supporting free, fair and inclusive
elections, supporting free and plural media22
, addressing questions of investments by third
countries in electoral infrastructure23
, cybersecurity24
, anti-money laundering and corruption25
.
Instead of relying on traditional and formal diplomatic channels and processes, foreign
governments increasingly rely on lobbyists and other forms of influence to promote their policy
objectives26
. Typically, states have resources that private actors might not have and pursue
different aims. As noted by the Organisation for Economic Co-operation and Development
(OECD), foreign governments “can have a transformative impact on the political life of a
country, not only on domestic policies but also on its foreign policy, its election system,
economic interests and its ability to protect its national interests and national security”27
and
the risks involved in lobbying and influence activities of foreign government are higher than
the risks posed by purely domestic lobbying and influence activities28
.
Several democratic countries outside the Union have already adopted measures including to
enhance transparency of interest representation activities carried out on behalf of third
countries and support democratic accountability. These include Australia and the US, while
17
Proposal for a Regulation on the statute and funding of European political parties and European political foundations
(COM(2021)734 final).
18
Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For
Digital Services and amending Directive 2000/31/EC (Digital Services Act).
19
The 2022 strengthened EU Code of Practice on Disinformation is available at: https://digital-
strategy.ec.europa.eu/en/policies/code-practice-disinformation; The Commission guidelines for teachers and educators on
tackling disinformation and promoting digital literacy through education and training is available at :
https://op.europa.eu/en/publication-detail/-/publication/a224c235-4843-11ed-92ed-01aa75ed71a1/language-en.
20
Information about the EU’s actions on FIMI is available at: https://www.eeas.europa.eu/eeas/tackling-disinformation-
foreign-information-manipulation-interference_en
21
Proposal for a Regulation of the European Parliament and of the Council on the transparency and targeting of political
advertising (COM/2021/731 final).
22
Proposal for a Regulation establishing a common framework for media services in the internal market (European Media
Freedom Act) and amending Directive 2010/13/EU (COM/2022/457 final); Proposal for a Directive on protecting persons
who engage in public participation from manifestly unfounded or abusive court proceedings (“Strategic lawsuits against
public participation”) (COM/2022/177 final); Commission Recommendation (EU) 2022/758 of 27 April 2022 on
protecting journalists and human rights defenders who engage in public participation from manifestly unfounded or
abusive court proceedings (‘Strategic lawsuits against public participation’).
23
Regulation (EU) 2019/452 establishing a framework for the screening of foreign direct investments into the Union (FDI
Screening Regulation).
24
Directive (EU) 2022/2555 of the European Parliament and of the Council of 14 December 2022 on measures for a high
common level of cybersecurity across the Union (NIS 2 Directive); Regulation (EU) 2019/881 of the European Parliament
and of the Council of 17 April 2019 on ENISA (the European Union Agency for Cybersecurity) and on information and
communications technology cybersecurity certification (EU Cybersecurity Act); Regulation (EU) 2022/2554 of the
European Parliament and of the Council of 14 December 2022 on Digital Operational Resilience for the Financial Sector
(DORA Regulation); Proposal for a Regulation on horizontal cybersecurity requirements for products with digital elements
(Cyber Resilience Act) (COM/2022/454 final).
25
Proposed package of legislative proposals on anti-money laundering and countering the financing of terrorism legislative
package, including the Proposal for a Directive of the European Parliament and of the Council on the mechanisms to be
put in place by the Member States for the prevention of the use of the financial system for the purposes of money laundering
or terrorist financing and repealing Directive (EU) 2015/849 (COM/2021/423 final), and the Proposal for a Directive on
combating corruption, replacing Council Framework Decision 2003/568/JHA and the Convention on the fight against
corruption involving officials of the European Communities or officials of Member States of the European Union and
amending Directive (EU) 2017/1371 of the European Parliament and of the Council (COM (2023) 234 final).
26
OECD (2021), Lobbying in the 21st Century: Transparency, Integrity and Access, OECD Publishing, Paris, available at:
https://doi.org/10.1787/c6d8eff8-en, page 43.
27
See note 26, page 44.
28
See note 26, page 45.
7
other democracies, like the UK and Canada are considering adopting similar measures.29
International organisations and fora such as the Organization for Security and Co-operation in
Europe (OSCE), OECD and G7 have also been working on the issue.
In the internal market, a wide range of cross-border activities which seeks to influence decision-
making processes is conducted on behalf of third countries. Such activities involve different
types of EU-based commercial and non-commercial entities such as think tanks, lobbying
firms, CSOs, or law firms. Interest representation involves direct contact with decision-makers,
communication and other efforts to represent a particular interest and influence decision-
makers and the wider debate. While these activities can be conducted transparently, this is not
always the case, and national measures intended to ensure the transparency and accountability
of such activities are not always effective in isolation at the national level.
Where they are regulated, interest representation activities carried out on behalf of third
countries are regulated together with other interest representation activities. Currently, 15
Member States30
have a transparency register on interest representation activities, albeit only
at sub-national level for some31
. In those Member States, where such a regulatory framework
exists, it is highly fragmented across the EU32
. The scope of the entities and activities covered
differ widely33
. There are different definitions of interest representation activities, thresholds
on the size of entities or level of activities triggering transparency or registration requirements,
as well as record-keeping34
. Moreover, the existence, powers, structures and independence of
supervisory authorities differ greatly across the EU. The same goes for the nature of sanctions,
and amounts of pecuniary fines, where they exist35
. 12 Member States do not regulate the
transparency of interest representation activities36
.
The internal market, already fragmented by existing rules, risks being further fragmented.
Member States have expressed increasing concerns about covert influence by third countries
in democratic processes in the EU. Some Member States are thinking to adopt measures to
protect their democratic sphere. Member States generally agree that EU action is needed
against the background of the need to address foreign interference.
In its Work Programme for 2023, the Commission announced that it would present a “Defence
of Democracy” package to increase transparency and accountability, thus promoting
“institutional trust and democratic values in the EU” and protecting “the EU democratic sphere
from covert interference in democratic processes”.
29
Although these legislations are not comparable to the so-called “foreign agent laws” as they are in place or have been
proposed in Russia or Georgia, some of these acts have been criticized as being too broad and vague in their definitions
and scope as well as envisaging criminal sanctions. The proposed measures consider these concerns and, therefore, define
key terms very precisely, envisage a targeted scope and proportionate sanctions.
30
DE, IE, EL, ES, FR, IT, CY, LT, LU, NL, AT, PL, RO, SI, FI.
31
ES, IT.
32
See Section 2.1.1.
33
For example, FR has a law on the transparency of public life that requires lobbyists to register with a public register and
report on their activities, such as those with foreign interests. Other Member States, such as IE or NL, also have laws or
regulations governing lobbying activities, although the scope and requirements of these laws vary significantly.
34
As further examples of the potential effect of differing registration requirements, an entity carrying out interest
representation in BE would need to disclose the names of the customers represented by them; meanwhile, in LU, the
identity of clients do not have to be entered into the register. In a similar vein, there is a discrepancy between obligations
to report financial figures on the expenditures that concern specifically interest representation activities. The federal lobby
register established in DE makes it mandatory to enter data on the annual financial expenditures of the organisation for
interest representation. In contrast, there is no comparable rule in the IE Regulation of Lobbying Act.
35
A complete mapping of this fragmentation is available in Annex 6 and 7.
36
BE, BG, CZ, DK, EE, HR, LV, HU, MT, PT, SK, SE.
8
The package builds upon and is complementary to the European Democracy Action Plan and
fully aligned with its logic37
. The initiative related to interest representation activities is a key
component of the Defence of Democracy package. The package will also include non-
legislative measures aiming to promote high standards for elections to the European Parliament
and elections and referenda at national level and to foster an enabling civic space and promote
the inclusive and effective participation of citizens and civil society organisations in the public
policy-making processes.
The main aim behind this initiative is to introduce common transparency and accountability
standards in the internal market for interest representation activities carried out on
behalf of third countries. By providing common transparency requirements for such
activities, the initiative will improve the functioning of the internal market for such activities,
by creating a level playing field, reducing unnecessary cost for entities that seek to carry out
interest representation activities on behalf of third countries across borders and prevent
regulatory arbitrage.
This intervention would also enhance the integrity of, and public trust in, the EU and Member
State democratic institutions by ensuring the transparency of interest representation activities
carried out on behalf of third countries on the basis of proportionate standards, and by
improving the knowledge of the magnitude, trends and actors of interest representation
activities carried out on behalf of third countries. The initiative would ensure full respect of
fundamental rights and democratic values; strong safeguards should mitigate the potential
negative impacts on concerned entities.
This initiative will provide for common transparency standards in the context of legal and
legitimate interest representation activities carried out in the interests of third countries in the
internal market. While interest representation activities carried out covertly on behalf of third
countries could amount to foreign interference, foreign interference encompasses a wide range
of activities that are carried out by or on behalf of a foreign state or a state actor, and which are
coercive, deceptive or corrupting and are contrary to the sovereignty, values and interests of
the Union and its Member States. This can for example include disinformation, corruption of
officials or cyber-attacks on the IT infrastructure supporting elections. This initiative does not
aim to exhaustively address all foreign interference activities.
The legislative initiative complements existing measures at EU level that contribute to
enhancing transparency and addressing certain activities carried out by or on behalf of third
countries. As regards activities impacting the democratic sphere, this includes the proposal for
a Regulation on the transparency and targeting of political advertising, the proposal for
European Media Freedom Act38
(EMFA), the Digital Services Act39
(DSA), the Regulation on
European political parties and European political foundations and the proposal to amend it40
and non-legislative measures for combating disinformation and other forms of foreign
interference, including the Foreign Information Manipulation and Interference Toolbox. It also
complements and is coherent with other legislative proposals, legislation and initiatives beyond
37
It also builds on the package reinforcing democracy and integrity of elections presented by the Commission on 25 November
2021.
38
Proposal for a Regulation of the European Parliament and of the Council establishing a common framework for media
services in the internal market (European Media Freedom Act) and amending Directive 2010/13/EU (COM(2022) 457
final), which aims to address fragmented national regulatory approaches related to media freedom and pluralism and
editorial independence to ensure the free provision of media services within the internal market, while ensuring that
Member States remain able to adapt media policy to their national context, in line with their competences.
39
Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For
Digital Services and amending Directive 2000/31/EU (OJ L 277, 27.10.2022, p. 1).
40
Regulation (EU, Euratom) No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute
and funding of European political parties and European political foundations (OJ L317, 4.11.2014, p. 1).
9
the European Democracy Action Plan which enhance the transparency of activities affecting
democratic processes, such as the Anti-Money Laundering Directive and the Whistle-blower
Directive.
The transparency achieved by these EU instruments and initiatives leaves an important part
uncovered which this initiative aims to address – interest representation carried out on behalf
of third countries.
2. WHAT IS THE PROBLEM AND WHY IS IT A PROBLEM?
2.1. What are the problems?
2.1.1. Obstacles to the internal market for interest representation
activities carried out on behalf of third countries.
In Member States where it is regulated, interest representation activities carried out on behalf
of third countries are regulated together with other interest representation activities.
At present, 15 Member States41
regulate the transparency of interest representation activities
and have a transparency register on interest representation activities, albeit only at sub-national
level for some42
. In those Member States, where such a regulatory framework exists, it is highly
fragmented across the EU43
, and only 9 of those Member States impose a specific legal
obligation to register before carrying out interest representation activities44
. Conversely, 12
Member States do not regulate the transparency of interest representation activities45
.
Fragmentation of the internal market for interest representation activities.
The definition of interest representation activities46
, and the scope of the entities and activities covered
differ widely leading to gaps in entities and activities covered. The actors required to register are usually
formulated in general terms across Member States47
, with natural and legal persons conducting interest
representation activities having an obligation to register themselves. In 5 Member States, more precise
rules exist on the personal scope for registering48
.
10 Member States49
do not have any thresholds in place for registration. In 2 Member States50
,
thresholds are purely financial, while in the 3 others51
, they are non-financial and based on criteria such
41
DE, IE, EL, ES, FR, IT, CY, LT, LU, NL, AT, PL, RO, SI, FI. .
42
ES, IT.
43
A complete mapping of this fragmentation is available in Annexes 6 and 7.
44
DE, IE, EL, FR, LT, LU, AT, PL, RO.
45
BE, BG, CZ, DK, EE, HR, LV, HU, MT, PT, SK, SE.
46
For example, in IE, an interest representation activity is defined as “any communication with a designated public officer
that relates to a “relevant matter”; while, in LT interest representation activities are defined as actions taken by a natural
or legal person, in an attempt to exert influence over defined public officials to have legal acts adopted or rejected in the
interests of the client or the beneficiary of lobbying activities.
47
DE, IE, ES, IT, CY, LT, LU, RO, SI.
48
BE, IE, FR, NL, AT. In AT, a limitative list exists with 4 categories of entities: lobbying companies, companies that
employ corporate lobbyists, self-governing bodies, and interest groups. In BE, the Rules of the House of Representatives
specify the entities that are obliged to register. The list includes, for example, specialised law firms, NGOs and think tanks.
In FR a lobbyist is defined as natural person as part of a professional activity, or legal entity in which an executive manager,
an employee or a member conducts interest representation work as their main or regular activity. In IE, different groups
of lobbyists are required to register (interest body, advocacy body, professional lobbyist, any person communicating about
the development or zoning of land). In NL, 3 groups are defined who need to register in the public register of lobbyists:
public affairs and public relations employees; agency representatives of CSOs; and representatives of municipalities and
provinces.
49
BE, IE, EL, ES, CY, LT, LU, NL RO, SI.
50
FR, NL.
51
DE, AT, IE. For instance, an entity paid to carry out interest representation professionally on behalf of a client that has
less than 10 employees would not need to register in IE, but it would need to register in DE for the same activity, since DE
law requires the registration of interest representation of a commercial nature.
10
as the frequency of contacts, the number of employees, or the time dedicated to lobbying activities.
Record-keeping obligations also differ across Member States52
.
With regard to supervision, enforcement and sanctions, in 9 Member States53
, the registers are
supervised by an independent authority. 3 other Member States54
tasked their government with this
supervision, while 3 others55
tasked their parliament. All Member States that have a supervisory regime
also have sanctions regimes. Pecuniary sanctions exist in 10 Member States56
. In all those Member
States, pecuniary sanctions are of an administrative nature, except in France where pecuniary sanctions
are of a criminal nature. Criminal sanctions exist in Member States such as France and Ireland57
.
Suspension or removal from a register is present as an enforcement measure in 2 Member States58
.
This fragmentation causes several obstacles in the internal market for interest
representation activities carried out on behalf of third countries that undermine the
proper functioning of the internal market.
First, there is an uneven playing field. Geographically, the transparency of interest
representation activities is regulated differently in different Member States. This regulatory
fragmentation results in a landscape in which interest representation activities are costly and
complex to perform in some Member States and not, or not to the same extent, in others. Among
providers of interest representation activities, diverging requirements at Member State level
impact different types of stakeholders in different ways, making them subject to more stringent
requirements than others although they would be performing the same activities59
.
Uneven playing field between different actors
Stakeholder views:
During the focus group with representatives of the legal profession60
, a majority of participants
emphasised the importance of setting up transparency requirements that apply to all entities performing
interest representation activities in the internal market. Among other, certain participants expressed the
view that there are loopholes in the current regimes regarding CSOs which carry out similar activities
while not being subject to similar transparency requirements regarding the funding of their activities
influencing decision-making processes in the EU.
During the second focus group with commercial actors involved in interest representation61
, one
participant noted that in its Member State some of the exemptions are too broad and for example exclude
lawyers from registration requirements although they may carry similar activities.
Illustrative case study n°1:
Commercial Company A carries out interest representation activities in Germany and in Lithuania and
faces different competitors in both Member States which do not face the same regulatory requirements.
In Germany, many of its competitors are organised like it, in the form of a commercial company.
However, it also faces competition from law firms which also perform interest representation activities
but do not always incur regulatory costs related to these activities when working in Germany at local
52
For example, some Member States conflate record keeping obligations with registration obligations, for example by not
distinguishing what is to be disclosed upon registration and what data has to be recorded and kept afterwards, as is the case
in AT. Specific rules on record-keeping exist for example in DE, where the federal lobby register makes it mandatory to
record and update data on the annual financial expenditures of the organisation for interest representation, while, in
contrast, there are no comparable rules in IE.
53
IE, EL, ES, FR, IT, CY, LT, SI, FI. Note that, in ES, this supervision only happens at regional level.
54
LU, AT, RO.
55
BE, DE, NL.
56
DE, IE, EL, ES (albeit at regional level), FR, CY, AT, SI, LT, PL. These can differ widely, between EUR 300 000 in ES
and EUR 4 500 in LT. A complete mapping of this fragmentation regarding sanctions is available in Annexes 6 and 7.
57
In FR up to 1 year of imprisonment, in IE up to 2 years of imprisonment.
58
DE, EL.
59
For example, in LT, CSOs are explicitly excluded from the scope of registration and transparency requirements. In DE,
legal professionals are also not required to register when they perform interest representation activities.
60
See focus group with legal professionals of 15 December 2022.
61
See second focus group meeting with commercial actors involved in interest representation of 1 March 2023.
11
level, as legal professionals only fall under the scope of rules on registration and transparency in some
Länder (e.g. Baden-Württemberg62
) whereas other Länder do not include them in the scope of their
transparency registers (e.g. Brandenburg63
)64
. In Lithuania, Commercial Company A faces regulatory
requirements which do not apply to civil society organisations performing similar activities, because
these are excluded from the scope of the registration and transparency requirements existing in
Lithuania65
.
Second, there are unnecessary costs for entities that wish to operate across borders in the
internal market. At present, the process of entering a new market in another Member State than
the state of establishment is made difficult by the costs of complying with fragmented rules.
Compliance with different regulatory frameworks
Stakeholder views
Interest representation service providers expressed their desire to expand beyond their Member State’s
market66
. During a focus group consultation with commercial actors involved in cross-border interest
representation activities, participants explained their difficulties to comply with all the different
transparency registers’ requirements, in particular with the need to maintain up-to-date information in
all of them, as the obligations vary across Member States.
Illustrative case study n°2
A small-sized service provider established in Sweden, specialised in interest representation activities
on behalf of third country A, wants to carry out these activities in several other Member States. It
therefore has to comply with different rules and requirements in each Member State which implies
costs. It decides to start with Greece and Slovenia. At present, Sweden67
does not regulate interest
representation activities while Greek68
and Slovene69
laws require to declare information such as the
institutions or bodies it intends to direct its interest representation activities to, the policy areas and
types of decisions it intends to target, and the intended results of its interest representation activities.
The service provider needs to ensure that its internal record-keeping allows it to easily comply with
Greek and Slovene laws.
The service provider then decides to enter the German market. However, its internal record-keeping is
not fit for purpose in this new context because Slovenia70
requires financial disclosures to be based on
payments received from interest regroups for each matter handled while in Germany71
these are based
on expenditures linked to interest representation activities.
62
See Gesetz über ein Transparenzregister, Landtag von Baden-Württemberg, Drucksache 16/9883.
63
See Führung eines Lobbyregisters, Gesetz- und Verordnungsblatt für das Land Brandenburg, Part 1, No. 20, Annex 10, 25
June 2020.
64
However, at the federal level in DE, legal professionals do not fall under the scope of the registration and transparency
requirement (i.e. when they write legal opinions, give legal advice etc.), unless they engage in activities that aim at
adopting, changing or abolishing a legal text by the Bundestag or the federal government.
65
Article 7(11) of the Law on Lobbying Activities of the Republic of Lithuania, available here: https://vtek.lt/wp-
content/uploads/2021/06/EN_Law_on_Lobbying_Activities_2021.docx.
66
See focus group with commercial actors involved in cross border interest representation activities of 1 March 2023.
67
See Annex 6.
68
Article 7(1)(a) of the Law Np. 4829 on Enhancing transparency and accountability in State institutions, available here:
Law 4829/2021 Government Gazette A 166/10.9.2021 (taxheaven.gr).
69
Integrity and Prevention of Corruption Act, Article 64, available here: https://www.kpk-rs.si/kpk/wp-
content/uploads/2018/06/ZintPK-ENG.pdf.pdf.
70
Integrity and Prevention of Corruption Act, Article 64, available here: https://www.kpk-rs.si/kpk/wp-
content/uploads/2018/06/ZintPK-ENG.pdf.pdf.
71
Lobby Register Act (Gesetz zur Einführung eines Lobbyregisters für die Interessenvertretung gegenüber dem Deutschen
Bundestag und gegenüber der Bundesregierung (Lobbyregistergesetz - LobbyRG)), 2021, available at:
http://www.gesetze-im-internet.de/lobbyrg/BJNR081800021.html, paragraph 6(1)6.
12
Later on, the interest representation service provider decides to also expand into Ireland and Lithuania.
While the mandatory update timeframes to the Greek72
and Slovene73
registers are the same, i.e. annual,
the requirements in Ireland74
are to update registration information every 4 months, and in Lithuania75
within 7 days following each lobbying activity. This will lead to creating an on-going mechanism
throughout the year instead of performing a disclosure exercise once yearly, as well as potentially
dedicating resources to maintain registrations up-to-date across the markets it operates in.
This situation also leads to one main consequence. The uneven playing field directs cross-
border interest representation activities away from more regulated Member States
towards less regulated ones or where enforcement is limited. In other words, there is a risk
of forum shopping and regulatory arbitrage by entities seeking to evade regulation in certain
Member States. This risk is especially high in those Member States that have a regulatory
regime for the transparency of interest representation, but do not make registration compulsory
or lack monitoring or enforcement mechanisms. Beyond the internal market-related
consequences described here, this phenomenon of regulatory arbitrage could also present an
opportunity for third-country actors to evade transparency requirements and covertly influence
decision-making in the EU.
2.1.2. Unknown magnitude, trends and actors of interest representation
activities carried out on behalf of third countries
The scale of interest representation activities carried out on behalf of third countries in the
Member states is largely unknown.
There are indications that the broader phenomenon of foreign interference exists and is
increasing. Some stakeholders have indicated that third country governments provide funding
with clear objectives which aim at legal or policy changes76
. There are also numerous media
reports of foreign interference from third countries whereby interest representation activities
are being carried out on behalf of third countries covertly to influence decision-making
processes, sow distrust and undermine the EU’s democratic processes77
.
Interest representation activities can take very different forms such as direct lobbying of
decision-makers, organising or participating in meetings, conferences or events, contributing
to or participating in consultations or parliamentary hearings, organising communication or
advertising campaigns, organising networks and grassroots initiatives, preparing policy and
position papers, legislative amendments, opinion polls, surveys or open letters, or activities in
the context of research and education, where they are specifically carried out with that
objective. They can be conducted both at European, national, and sub-national level and they
can have a harmful and disruptive impact on decision-making processes. However, Member
States do not consistently collect or systematically share information on interest representation
carried out on behalf of third countries and there is no reliable and consistent data on these
72
Article 10(1) of the Law Np. 4829 on Enhancing transparency and accountability in State institutions, available here: Law
4829/2021 Government Gazette A 166/10.9.2021 (taxheaven.gr).
73
Integrity and Prevention of Corruption Act, Article 63, available here: https://www.kpk-rs.si/kpk/wp-
content/uploads/2018/06/ZintPK-ENG.pdf.pdf.
74
Sections 7 and 12(1) of the Regulation of Lobbying Act.
75
Article 10(1) of the Law on Lobbying Activities of the Republic of Lithuania, available here: https://vtek.lt/wp-
content/uploads/2021/06/EN_Law_on_Lobbying_Activities_2021.docx.
76
In the consultation, 5 CSOs explained that “few government donors, including the EU itself, regularly provide operating
grants. The EU and other governments generally provide project-based funding with clear objective – many of which aim
at legal or policy changes”. Another CSO explained that many CSOs, especially those in the field of human rights,
“currently rely on funding by foreign foundations and public entities to carry out their advocacy and campaigning work”.
1 CSO clarified that “the mere fact that a CSO benefits from funding form a foreign government or associated entity
supporting legal or policy change is not sufficient to cast doubts over the legitimate nature of its activities”.
77
See chapter 2 and Annex C of the supporting study which includes an extensive collection of covert foreign influence in
decision-making processes in the EU.
13
activities. This results in difficulties to identify and map interest representation activities
carried out on behalf of third countries and do so in a coordinated and efficient way across the
EU. This makes the situation prone to foreign interference operations, as third countries may
seek to exploit the information asymmetry among authorities. In turn, it has an effect on wider
perceptions about the integrity of public decision-making.
The lack of transparency and inconsistency of regulation and oversight, the many different
ways in which interest representation activities on behalf of third countries are carried out and
the difficulty of measuring them, do not allow to monitor these activities accurately, especially
with quantitative data. It also risks conflating legitimate interest representation by third
countries with covert activities which may not pursue such ends.
Differences in data collection requirements
Discrepancies in data collection requirements in Member States make it difficult to shed light and
identify patterns on the magnitude of the phenomenon of interest representation activities carried out
on behalf of third countries, be it with regard to the entities, the activities they perform, and the amounts
of money involved.
While 12 Member States78
require identification data of interest representatives (e.g. name of the
lobbyist), only 8 Member States79
request specific information on the client represented by the entity
carrying out interest representation activities (e.g. name of the client). Furthermore, only 10 Member
States80
require entities to provide information on the policy field in which they pursue interest
representation for their clients, while 6 Member States81
ask for information on the budget/expenditure
from entities carrying out interest representation activities, albeit in different ways82
.
Data comparisons are further complexified by the differences in regimes with regard to the updates of
that data. For example, in Ireland83
, updates have to take place 3 times a year, while in countries such
as France84
or Greece85
updates take place once yearly. In other Member States such as Finland86
or
Germany87
, only some information has to be updated yearly while other information has to be updated
twice yearly (e.g. financial information in Finland) or at the end of every quarter (e.g. basic personal
data such as addresses and contact details in Germany). Another system exists for example in
Lithuania88
where updates have to take place within 7 days of an interest representation activity taking
place.
Lastly, data analysis is rendered difficult by the fact that not all registers are public, and that for those
that are, not all data is publicly accessible. The data of transparency registers on lobbying is made public
on the websites of 10 Member State89
authorities, while it is not the case in 2 others90
. In the Member
78
BE, DE, IE, EL, FR, IT (at subnational level), LT, LU, NL, AT, RO, SI.
79
BE, DE, EL, FR, IT (at subnational level), LU, NL, AT.
80
BE, DE, IE, EL, FR, IT (at subnational level), LT, LU, AT, SI.
81
DE, ES (at regional level), FR, IT (at subnational level), AT, SI.
82
For example, in SI, financial information on payments received from interest groups for each matter concerned, while in
DE, information on financial expenditures involved in the representation of interests are required as well as on the sums
of any public allowances or grants received.
83
Sections 7 and 12(1)(6) of the Regulation of Lobbying Act, available here:
https://www.irishstatutebook.ie/eli/2015/act/5/enacted/en/print.html.
84
See Articles 3 et seq. Décret No. 2017-879 du 9 mai 2017 relatif au répertoire numérique des représentants d’intérêts,
available at the following link : https://www.legifrance.gouv.fr/jorf/id/JORFTEXT000034633293/.
85
Article 10(1) of the Law No. 4829 on Enhancing transparency and accountability, available here:
https://www.taxheaven.gr/law/4829/2021.
86
Finnish Transparency Register Act 23.3.2023/430, section 8, paragraph 1, available at:
https://www.finlex.fi/fi/laki/ajantasa/2023/20230430.
87
Lobby Register Act (Gesetz zur Einführung eines Lobbyregisters für die Interessenvertretung gegenüber dem Deutschen
Bundestag und gegenüber der Bundesregierung (Lobbyregistergesetz - LobbyRG)), 2021, available at:
http://www.gesetze-im-internet.de/lobbyrg/BJNR081800021.html, paragraph 3(3).
88
Article 10(1) of the Law on Lobbying Activities, available here: https://vtek.lt/wp-
content/uploads/2021/06/EN_Law_on_Lobbying_Activities_2021.docx.
89
BE, DE, IE, ES (at regional level), FR, IT (at subnational level), LT, LU, NL, AT, RO, SI.
90
EL, CY.
14
States where transparency registers are publicly accessible, certain restrictions exist. For example, in
Austria91
, the legal regime only requires the disclosure of general information about the purposes and
amounts spent on interest representation activities and does not include most of the information on
clients that certain other Member States require (e.g. names and contact details of the clients or granular
description of the sums received).
The lack of transparency undermines democratic processes and impacts EU citizens’ trust
in related processes and/or decision-makers and their ability to exercise their rights and
responsibilities.
Citizens are concerned about the impacts of foreign government meddling with decision-
making processes in the EU. A recent Eurobarometer on Citizenship and Democracy showed
that about 8 in 10 Europeans agree that foreign interference in European democratic systems
is a serious problem that should be addressed92
. According to the Online Public Consultation
84.5% of respondents considered that lobbying or public relations activities remunerated by or
controlled by third countries triggered a high risk of covert foreign interference. 65% of them
considered that the activities of think tanks remunerated by third countries triggered such a
risk. A survey conducted by Friedrich-Ebert-Stiftung on European sovereignty in 8 EU
Member States93
found that 93% of respondents considered that it is essential or important to
have common tools to combat foreign interference for Europe to be sovereign94
. Due to the
lack of information on the magnitude, trends and actors of interest representation carried out
on behalf of third countries, it is difficult to assess the reality and the risks caused by this
phenomenon and establish the data needed to develop evidence-based policy.
This problem is a European one. Interest representation activities carried out on behalf of third
countries is a transnational issue with cross-border implications that can affect the policy
decisions and political processes of other countries. This is because third countries often engage
in activities aimed at influencing policy decisions and political processes in Member States,
which can have an impact beyond each Member States’ borders. It is not necessary to exercise
influence at the European level to impact EU decision-making.
91
Federal Act on Ensuring Transparency in the Exercise of Political and Economic Interests (Lobby law)‘ (Bundesgesetz
zur Sicherung der Transparenz bei der Wahrnehmung politischer und wirtschaftlicher Interessen (Lobbying- und
Interessenvertretungs-Transparenz-Gesetz – LobbyG)), 2012, available at:
https://www.ris.bka.gv.at/GeltendeFassung.wxe?Abfrage=Bundesnormen&Gesetzesnummer=20007924 , paragraphs
9(2) and 10(2).
92
See flash Eurobarometer 528 on Citizenship and Democracy.
93
DE, ES, FR, IT, LT, PL, RO and SE were the countries participating in the study with 8000 citizens from the selected
countries participating in the interviewing process.
94
58% of respondent considered such tools “essential”, and 35% considered them “important but not essential”, available at:
https://www.fes.de/en/survey-europeeignty
15
Figure 1. Problem tree:
2.2. Magnitude of the problems
As presented in detail in Annexes 3 and 4, the estimates place the number of players in the
internal market for interest representation activities carried out on behalf of third countries (the
population of enterprises that would be subject to requirements under the proposed policy
options) at between 712-1,068 enterprises95
. The number of market actors does not prejudge
the influence of such activities on the democratic sphere (see section 2.1.2).
Currently, there is no comprehensive data available on the size of the market for interest
representation across the EU, or the specific market for interest representation activities carried
out on behalf of third countries. Furthermore, even if interest representation activities carried
out on behalf of third countries are a transnational issue, there is also a lack of data on the cross-
border activities of these entities carrying out interest representation activities on behalf of third
countries.
95
By Member State, FR (260-390), DE (126-189) and IT (74-111) have the most service providers and contribute
approximately 65% of all such service providers across the EU-27.
16
The current legal fragmentation described in the previous section contributes to explain this
lack of information. Data collection across Member States is not unified and cannot provide a
sufficient basis to highlight how much of the interest representation activities taking place in
the internal market happen across borders nor to estimate the size of the market. This issue is
further compounded by the lack of transparency generally characterising the market for interest
representation activities.
The fragmentation of the internal market for interest representation activities carried out on
behalf of third countries is presented in section 2.1.1. Annex 6 presents the regulatory situation
in the Member States.
As explained in Section 2.1.2 comprehensive information on the magnitude, trends and actors
of interest representation activities carried out on behalf of third countries is lacking.
2.3. How will the problems evolve?
Regarding the first problem, obstacles in the internal market, the issues related to the
uneven playing field, the risk of regulatory arbitrage and the unnecessary costs for entities
carrying out interest representation activities that wish to operate across Member States are
bound to increase.
This problem is driven in a large part by the fragmentation of the internal market which is itself
likely to increase. The consultations carried out during the preparation of the initiative, in
particular in the context of focus group meetings and contributions provided by Member State
authorities showed an increasing risk awareness in Member States about the issue of interest
representation carried out on behalf of third countries, and an increase in national plans for
regulatory interventions to address this issue. For example, in countries like Poland and the
Netherlands96
, draft laws have been put forward which would impact foreign funding, which
could affect entities carrying out interest representation on behalf of third countries. In both
cases, stakeholders expressed concerns, which were also reflected in the 2022 Rule of Law
Report97
. Some Member States, such as France, have indicated their interest in regulating in
particular interest representation carried out on behalf of third countries98
. Furthermore, draft
laws regulating interest representation in general are either under discussion or planned in 12
Member States99
. Furthermore, the fact that Member States do not consistently collect or
systematically share information on interest representation carried out on behalf of third
countries leads to different levels of awareness of the issue that could result in Member States
responding divergently to this phenomenon. Such fragmentation would exacerbate the
obstacles faced by entities carrying out interest representation on behalf of third countries in
the internal market.
The second problem, the unknown magnitude, trend and actors of covert interest
representation activities carried out on behalf of third countries, will not be solved over
time within the current baseline scenario. Both the issues of the lack of transparency in the
market for interest representation activities carried out on behalf of third countries and the
willingness of third countries to covertly influence decision-making in the EU are likely to
remain or increase. While it is in the interest of many actors in this market to operate
transparently to preserve the reputation of their industry and of their other clients, the market
96
See Annex 6.
97
See 2022 Rule of Law Report, Country Chapters on the rule of law situation in Netherlands and Poland, available at:
44_1_193999_coun_chap_netherlands_en.pdf (europa.eu) and https://commission.europa.eu/system/files/2022-
07/48_1_194008_coun_chap_poland_en.pdf.
98
Bi-lateral meeting between the Commission and the French Haute Autorité pour la Transparence de la Vie Publique of 14
September 2023.
99
According to the supporting study this includes BE, BG, CZ, IE, ES, FR, IT, LV, MT, NL, PL, SK, see Annex 6.
17
for interest representation activities cannot by itself promote more transparency without
regulatory interventions.
In addition, an increase in reports of interference operations carried out via interest
representation activities would lead to more distrust from citizens in decision-making processes
and decision-makers. The Commission’s 2021 Strategic Foresight Report indicates that
pressure on democratic models of governance and values is likely to persist in the coming
decades due to rising geopolitical tensions, and that “the long-term performance of democratic
systems hinges on their capacities to adapt to new realities and to remain resilient to internal
and external challenges”100
. As reported by the OECD, foreign governments increasingly rely
on lobbyists and other forms of influence to promote their policy objectives101
.
3. WHY SHOULD THE EU ACT?
3.1. Legal basis
Article 114 of the Treaty on the Functioning of the European Union (TFEU) allows for the
adoption of measures which have as their object the establishment or functioning of the internal
market and which are considered necessary for the approximation of the provisions laid down
by law, regulation or administrative action in the Member States. In accordance with Article
288 TFEU, these measures may take the form of regulations, directives, decisions,
recommendations, and opinions.
The Court of Justice has confirmed that recourse to Article 114 TFEU as a legal basis is
possible if the aim is to prevent the emergence of future obstacles to trade as a result of
divergences in national laws, where the emergence of such obstacles is likely and the measure
in question is designed to prevent them102
.
Article 114 TFEU does not presuppose the existence of a link with the free movement of
services in every situation covered by the measures founded on that basis103
. It permits
additional objectives to be pursued104
. Measures based on Article 114 TFEU may touch upon
many different areas, because the economic and the non-economic aspects of national
provisions pursuing an objective in the public interest are many times closely intertwined. As
confirmed by the Court, the EU legislature cannot be prevented from relying on that legal basis
on the ground that the protection of other policy objectives is a decisive factor in the choices
100
Commission’s 2021 Strategic Foresight Report, available at: https://eur-lex.europa.eu/legal-
content/EN/ALL/?uri=COM%3A2021%3A750%3AFIN
101
See note 26, page 43.
102
Judgments of the Court of Justice of 3 December 2019, Czech Republic v Parliament and Council, C-482/17,
EU:C:2019:1035, paragraph 35; of 4 May 2016, Poland v Parliament and Council, C-358/14, EU:C:2016:323, paragraph
33; of 8 June 2010, Vodafone and others v Secretary of State for Business, Enterprise and Regulatory Reform, C-58/08,
EU:C:2010:321, paragraph 33; of 14 December 2004, Arnold André, C-434/02, EU:C:2004:800, paragraph 31; of 14
December 2004, Swedish Match, C-210/03, EU:C:2004:802 paragraph 30; of 12 July 2005, Alliance for Natural Health
and Others, joined cases C-154/04 and C-155/04, paragraph 29; and of 5 October 2000, Germany v Parliament and
Council, C-376/98, EU:C:2000:544, paragraph 86.
103
Judgment of the Court of Justice of 20 May 2003, Österreichischer Rundfunk and Others, joined cases C-465/00 and C-
138/01, EU:C:2003:294, paragraphs 41 and 42. In this case, the Court ruled that the Data Protection Directive 95/46/EC
(at that time based on Article 100A of the Treaty establishing the European Community) could be applied even though it
applied to a wholly internal situation. See also judgment of the Court of Justice of 6 November 2003, Lindqvist, C-101/01,
EU:C:2003:596, paragraphs 40 and 41.
104
Judgments of the Court of Justice of 28 April 1998, Kohll v. Union des caisses de maladie, C-158/96, EU:C:1998:171;
Decker v. Caisse de maladie des employés privés, C-120/95, EU:C:1998:167; of 9 October 2001, Netherlands v
Parliament, C-377/98, ECLI:EU:C:2001:523, paragraph 27; and of 11 June 1991, Commission v Council, C-300/89,
ECLI:EU:C:1991:244, paragraph 13.
18
to be made105
. What is relevant is that the measures adopted on that basis be actually intended
to improve the conditions for the establishment and functioning of the internal market106
.The
Court focuses on the fulfilment of the conditions for the use of Article 114 TFEU, i.e., that the
measure in question effectively pursues the internal market objective.
Currently, Member States have divergent approaches to defining and regulating interest
representation activities carried out on behalf of third countries in the internal market. These
differences restrict the freedom to provide services107
and therefore have a direct effect on the
functioning of the internal market108
. In the absence of EU action, some Member States are
likely to implement national legislation. Draft laws regulating interest representation in general
are either under discussion or planned in 12 Member States109
. Poland, the Netherlands and
France are considering legislations which would affect in particular entities carrying out
interest representation on behalf of third countries.
In light of the existing fragmentation (see section 2.1.1), which is likely to increase, it is
necessary to provide for harmonised transparency measures to create an even playing field,
reduce existing compliance costs and regulatory arbitrage as well as the emergence of
additional obstacles in the internal market for interest representation activities carried out on
behalf of third countries, resulting from an inconsistent development of national laws.
The objective of this intervention is to ensure the proper functioning of the internal market for
interest representation activities carried out on behalf of third countries through harmonisation
of regulatory approaches regarding the transparency of such activities.
Even though Article 114(3) TFEU does not mention the resilience of EU democracies and
decision-making processes (unlike, for example, a high level of health protection,
environmental protection or consumer protection), it is inherent to the purpose of Article 114
TFEU that the objectives of the national rules which are to be approximated through
harmonisation should be taken into account. The objective of ensuring the transparency of
activities affecting public decision-making and the functioning of democratic institutions is a
legitimate public goal. It therefore follows from the purpose of Article 114 TFEU that EU rules
harmonising national rules adopted to regulate an activity in the pursuit of these goals may
themselves pursue the same ends. In this regard, this intervention also aims to enhance the
integrity of, and public trust in, the EU and Member State democratic institutions by ensuring
the transparency of interest representation activities carried out on behalf of third countries.
Furthermore, in Article 2 of the Treaty on European Union (TEU) democracy is recognised as
one of the essential values on which the Union is founded. The Court has ruled on 16 February
2022 on the rule of law conditionality regulation that “the EU must be able to defend those
values, within the limits of its powers as laid down by the Treaties”110
. This case law indicates
that the EU legislature is empowered to ensure the protection of the values mentioned in Article
105
Judgment of the Court of Justice of 10 December 2002, The Queen v Secretary of State for Health, ex parte British
American Tobacco (Investments) Ltd and Imperial Tobacco Ltd., C-491/01, EU:C:2002:741, where the policy objective
at hand was public health protection.
106
See note 103, in particular judgment of the Court of Justice of 6 November 2003, Lindqvist, C-101/01, EU:C:2003:596,
paragraphs 40 and 41.
107
For example, during the second focus group meeting with commercial actors involved in interest representation of 1 March
2023,1 participant expressed its difficulty to maintain up-to-date registration information in all the markets in operates in
across the Union (in its case, BE, DE, NL, as well as the EU TR).
108
Judgments of the Court of Justice of 12 December 2006, Germany v Parliament and Council (Tobacco 2), C-380/03,
EU:C:2006:772, paragraph 37; of 4 May 2016, Poland v Parliament and Council, C-358/14, EU:C:2016:323, para 32; and
of 8 June 2010, The Queen, on the application of Vodafone Ltd and Others v Secretary of State for Business, Enterprise
and Regulatory Reform (Vodafone), C-58/08, EU:C:2010:321, paragraph 32.
109
According to the supporting study this includes BE, BG, CZ, ES, FR, IE, IT, LV, MT, NL, PL, SK, see Annex 6.
110
Judgment of the Court of Justice of 16 February 2022, Hungary v Parliament and Council, C-156/21, EU:C:2022:97,
paragraph 127.
19
2 TEU and of other fundamental rights (such as the right to receive information) where it has
an appropriate legal basis for taking legislative action.
EU action focusing on transparency is needed to prevent obstacles to the provision of interest
representation activities carried out on behalf of third country entities, ensuring the
establishment and functioning of the internal market. It will also contribute to improve the
knowledge on the magnitude, trends and actors of interest representation activities carried out
on behalf of third countries. Importantly, the intervention does not aim to restrict the provision
of interest representation activities carried out on behalf of third countries in the internal
market.
3.2. Subsidiarity: Necessity and added value of the EU action
According to the principle of subsidiarity (Article 5(3) TEU), action at EU level should be
taken only when the aims envisaged cannot be achieved sufficiently by Member States alone
and can therefore, by reason of the scale or effects, be better achieved by the EU.
As Member States’ rules affecting interest representation on behalf of third countries diverge
in their scope, content and effect, a patchy framework of national rules is appearing and risks
to increase, especially when it comes to interest representation activities carried out on behalf
of third countries. It undermines the internal market by creating an uneven playing field and
unnecessary costs for entities that seek to carry out cross-border interest representation
activities on behalf of third countries. It invites regulatory arbitrage to avoid transparency
measures which in turn impacts the citizens’ confidence and trust in the effectiveness of
regulation.
Only intervention at EU level can solve these problems, as regulation at national level already
results in the creation of obstacles to cross-border interest representation activities in the
internal market. In contrast, the effects of any action taken under national law would be limited
to a single Member State and risks being circumvented or be difficult to oversee in relation to
entities carrying out interest representation on behalf of third countries from other Member
States. Furthermore, some Member States are currently considering legislative initiatives in the
field of foreign influence that might not align with the proportionate and targeted approach of
this initiative and that might not provide with a comprehensive system of safeguards. Only
action at EU level can address this consistently across the internal market. Introducing common
and proportionate standards for transparency of interest representation carried out on behalf of
third countries at EU level is essential to ensure that such measures are established consistently
across all Member States with respect to all fundamental rights and in particular subject to
comprehensive safeguards including access to the courts.
Finally, interest representation activities carried out on behalf of third countries is a
transnational issue with cross-border implications that need to be addressed at EU level.
Influencing policy decisions and political processes in one Member State can have an impact
beyond that Member State’s borders, in another Member State or at the European level. The
absence of EU-level action may result in some Member States being less knowledgeable than
others about interest representation activities carried out on behalf of third countries, and it
seems unlikely that Member States would converge on aligned standards on how to collect
comparable data on interest representation activities carried out on behalf of third countries, or
establish a systematic EU wide cooperation mechanism to exchange information with each
other and the Commission.
20
Figure 2. Intervention logic:
21
4. OBJECTIVES: WHAT IS TO BE ACHIEVED?
4.1. General objectives
There are 2 general objectives:
• Ensure the proper functioning of the internal market for interest representation activities
carried out on behalf of third countries.
• To contribute to the transparency, integrity of, and public trust in, EU and Member State
decision-making processes, with regard to the influence of third countries.
4.2. Specific objectives
In line with the general objectives, the following are the specific objectives:
• Facilitate cross-border interest representation activities carried out on behalf of third
countries when done transparently.
• Improve knowledge about the magnitude, trends and actors of interest representation
carried out on behalf of third countries.
There may be trade-offs between facilitating cross-border interest representation activities and
imposing common transparency standards on entities carrying out interest representation on
behalf of third countries.
5. WHAT ARE THE AVAILABLE POLICY OPTIONS?
5.1. What is the baseline from which policy options are assessed?
The baseline is formed by Member States’ fragmented regulatory frameworks or its
absence, which has been illustrated in the previous sections. There is currently no EU action
that directly address the obstacles encountered in the internal market for interest representation
activities carried out on behalf of third countries.
The EU has, however, an existing toolbox of measures that aim at addressing issues in certain
areas, potentially exploited by some third countries, and that continue to evolve (dynamically).
An overview of those current and planned measures is presented in Annex 9. They include
updating rules governing European political parties and foundations111
, regulating various
aspects of online platforms, addressing disinformation, detecting, analysing and countering
foreign information manipulation and interference (FIMI)112
, regulating political advertising
including on social media113
, supporting free, fair and inclusive elections, supporting free and
plural media114
, addressing questions of investments by third countries in electoral
infrastructure115
, cybersecurity116
, anti-money laundering and corruption117
. These instruments
are relevant for defining the broader environment in which a potential EU initiative under
consideration will insert itself and evaluate its complementarity, coherence, added value.
111
See note 17.
112
See note 20.
113
The 2022 strengthened EU Code of Practice on Disinformation, see note 19; the Digital Services Act, see note 18; the
proposal for a Regulation on the transparency and targeting of political advertising, see note 21.
114
The proposal for a European Media Freedom Act, the proposal for an anti-SLAPP Directive and Recommendation, see
note 22.
115
The FDI Screening Regulation, see note 23.
116
The NIS2 Directive, the ENISA Regulation, the DORA Regulation and the Cyber Resilience Act, see note 24.
117
The proposal for the 6th
AML Directive and the proposed anti-corruption Directive, see note 25.
22
5.2. Scope of the policy intervention
Specific options have been discarded on the basis of the following analysis.
The scope of the intervention could be modulated on the basis of i) the geographical location
and ii) the nature of the entity on whose behalf the interest representation activity is carried
out.
When it comes to the geographical location, the available possibilities would be to cover either:
• some third countries: this option would seek to include in the scope only activities on
behalf of specific third countries identified based on objective criteria. In its resolution
on foreign interference in all democratic processes, the European Parliament expressed
the preference for a risk-based approach based on some criteria which includes:
“engagement in activities of foreign interference, an intellectual property theft
programme directed against the EU and its Member States, legislation that forces
national non-state actors to participate in intelligence activities, consistent violation
of human rights, revisionist policy towards the existing international legal order,
enforcement of authoritarian ideology extraterritorially”118
. Similarly, to the Anti-
Money laundering Directive119
, a list of such countries would be established by the
Commission through delegated acts. EEA Member States would not be included; or
• all third countries (with additional requirements for some countries based on a
risk-based approach): this option would include activities on behalf of entities in all
third countries, but specific requirements could be imposed when an entity carries out
interest representation activities on behalf of a third country that has spent a significant
amount on interest representation in a Member State or the EU as a whole120
(risk-
based approach). EEA Member States would not be included.
The scope of the legislative intervention would also change on the basis of the type of entity
on whose behalf the interest representation would be carried out:
• governments and affiliated entities (that is, governments and entities whose action
can be attributed to them): it would cover i) the central government and public
authorities at all other levels of a third country (except EEA) as well as, to avoid
circumvention, ii) public or private entities, including EU citizens and legal persons
established in the EU, whose actions can ultimately be attributed121
to a central
government or public authorities of a country. It would cover situations where a
government is behind the decision of another entity to have interest representation
activities carried out on its behalf, in particular by giving instructions or directives to
that entity122
. It would also cover entities that are controlled123
by the government or a
public authority. In terms of actors covered, all public or private entities, including EU
118
European Parliament resolution of 1 June 2023 on foreign interference, see note 8, point 6.
119
Article 9 of Directive (EU) 2015/849 of 20 May 2015 on the prevention of the use of the financial system for the purposes
of money laundering or terrorist financing.
120
This approach is based on the observation that the amounts spent on interest representation translates into bigger influence.
As highlighted by the OECD: “The evidence is that policy-making is not always inclusive. At times, a monopoly of influence
may be exerted by the financially and politically powerful, at the expense of those with fewer resources. Inequity in power
and lobbying budgets exacerbates the disadvantages of groups lacking in the capacity and capability to engage in
formulating policy.” See note 26, page 16.
121
The concept is inspired by Article 3(3) of Regulation (EU) 2022/2560 of the European Parliament and of the Council of
14 December 2022 on foreign subsidies distorting the internal market.
122
This would cover instructions by the government, through directives or legal requirements.
123
A government or a public authority would control an entity carrying interest representation where through economic rights,
contractual arrangements, or any other means, either separately or combination confer the possibility of exercising decisive
influence on that entity.
23
citizens and legal persons, i.e. for example commercial entities, CSOs, cultural or
research organisations, law firms etc., could fall under the scope given that their actions
can ultimately be attributed to a central government or public authorities of a country.
• all entities established in the designated countries. This would include activities on
behalf of governments and affiliated – as defined above –, but also cases where they
are carried out on behalf of other entities, including private actors or other
organisations such as or international organisations (e.g., lobbying on behalf of a
company)
Table 1: possible approaches to scope of the measures
Some 3rd
countries All 3rd
countries
Governments and affiliated Option A Scope of the initiative
All entities Option B Option C
5.2.1. Option A
This policy option requires to establish a list of third countries that have attempted to conduct
foreign interference. This option faces 4 types of operational difficulty.
Firstly, assessing whether a third country meets the criteria mentioned by the European
Parliament (in particular: consistent violation of human rights, revisionist policy towards the
existing international legal order, enforcement of authoritarian ideology extraterritorially)
might prove challenging as the criteria are subject to interpretation. This lack of objective
criteria might lead to a political decision instead of an objective technical one124
.
Secondly, the management of the list will be very difficult. In light of the subjective nature of
the criteria, agreeing on common criteria could prove difficult, making it likely that only a
limited number of third countries would be included, limiting the effectiveness of the
instrument. Furthermore, if a third country targets only 1 or 2 Member States, it might be
politically difficult to include such third country on a common list, thereby limiting the
possibility of the concerned Member States to provide for transparency for such activities.
Establishing a list at Member State level may lead to an even more uneven playing field within
the single market. In addition, the list of third countries would need to be constantly reviewed
and adapted on the basis of the evolving political situation in the concerned third countries.
Stakeholder views:
1 CSO (out of 11) stated that imposing “transparency requirements only on entities from third countries,
drawing up a list of specific third countries could be very risky, as countries could be selected on the
basis of the political and economic interests of Member States. The list would therefore be incomplete
and leave out third countries that were not on the European Commission's radar because of their
advocacy activities.”
2 out of 15 Member States cautioned against such an approach. 1 of them stated that “it would be almost
impossible to objectively define such countries”.
Thirdly, because the scope would only focus on third countries specifically identified, the
entities that would fall into scope would be subject to significant risks of stigmatisation, a key
concern of expressed by CSOs in the consultation process.
124
Using existing lists like government or government-linked entities not subject to EU restriction measures; third country
whose nationals are not exempt from the requirement to be in possession of visas when crossing the external borders
pursuant to Regulation (EU) 2018/1806; countries listed as a high-risk third country pursuant to Anti Money Laundering
Directive would not solve this issue as criteria for establishing these lists are not linked to the propensity of these countries
to engage in foreign interference.
24
Similarly, the geopolitical implications concerning the identified third countries could be more
severe.
This option has therefore been discarded.
5.2.2. Option B
This policy option may be discarded in light of the elements underlined in A and C
5.2.3. Option C
Policy Option C would cover interest representation activities seeking to influence decision-
making in the EU carried out on behalf of any entities established in a third country. Such scope
would be designed, not based on a genuine link with the risk of covert influence by third
countries administrations but on an overshooting presumption made on the principle that any
interest representation activity on behalf of a natural or legal person established in a third
country could be source of covert influence by said third country government. Such a broad
scope would not be targeted enough in view of the pursued aim of the initiative and therefore
be disproportionate125
. Option C has therefore been discarded.
5.2.4. Other possible scope
5.2.4.1. Interest representation carried out on behalf of any government
or entity
It could be considered to enlarge the scope of the initiative to cover 1) interest representation
carried out on behalf of any governments (including EU Member States and EEA countries) or
2) to cover interest representation carried out on behalf of any entity.
Stakeholder views:
Extending the scope to cover intra-EU activity has been suggested by 6 CSOs (out of 11), 6 Members
States (out of 15) and 2 industry associations (out of 3) in their contributions. 1 Member State explicitly
opposed this by indicating that “harmonisation of all the measures governing interest representation in
the Member States would go far beyond the purpose of the Commission’s initiative and would be
difficult to achieve at least in the short term.”
As highlighted in sections 2 and 4, the intervention covered by this initiative focuses on interest
representation carried out on behalf of third countries. Taking into account the geopolitical
context, an increasing number of Member States are considering specific measures related to
interest representation activities carried out on behalf of foreign governments (see section 2.3).
The targeted scope of the intervention logic seeks to remove obstacles in the market of interest
representation activities by establishing common transparency standards for activities
influencing decision-making processes in the EU carried out on behalf of third countries.
Covering interest representation carried out on behalf of any entity would further harmonise
requirements in the internal market, but it would require moving away from the issue of foreign
interference.
As reported by the OECD, instead of relying on traditional and formal diplomatic channels and
processes, foreign governments increasingly rely on lobbyists and other forms of influence to
promote their policy objectives126
. Third country governments may engage in lobbying,
including by contracting public relations firms to conduct lobbying on their behalf. They may
also fund other entities to produce evidence supporting their goals, including by providing
125
See by analogy judgment of the Court of Justice of 18 June 2020, Commission v. Hungary, C-78/18, paragraphs 86 to 93.
126
See note 26, page 43.
25
benefits in kind such as material gifts. This type of influence activities by third country
governments, if done covertly, is concerning as it undermines the principles of transparency
and accountability when trying to influence public decision-making processes in the EU.
The impact of such influence is increasingly acknowledged in international fora. The OECD
considers that foreign governments “can have a transformative impact on the political life of a
country, not only on domestic policies but also on its foreign policy, its election system,
economic interests and its ability to protect its national interests and national security127
” and
the risks involved in lobbying and influence activities of foreign government are higher than
the risks posed by purely domestic lobbying and influence activities128
. Covert foreign funding
seeking to influence a decision making process is by definition difficult to demonstrate due to
its secret nature.
Covering interest representation carried out on behalf of any entity would benefit economic
actors as it would remove obstacles to the internal market for other interest representation
activities. 1 CSO also argues that it could limit stigmatisation. A wider scope covering interest
representation on behalf of any entities would also be disproportionate to achieve the targeted
objectives of this initiative. An intervention covering all types of interest representation would
affect around 3.5 million entities in the EU129
, when it can be estimated that only around 700
to 1100 entities provide interest representation on behalf of third country governments in the
EU130
. In addition, since 2020, the Commission monitors with specific recommendations,
under the anti-corruption pillar of the Rule of Law Report, the regulation of all interest
representation in Member States, within the framework of existing European and international
standard131
.
Covering interest representation activities carried out by other Member States/EEA countries
would not be aligned with the second objective aiming to contribute to the transparency,
integrity of, and public trust in, EU and Member State decision-making processes, with regard
to the influence of third countries. This is coherent with the principle of mutual trust, which is
a general principle of Union law whose fundamental importance has been recognized by the
European Court of Justice (see e.g. Case C‑34/17). There is also no specific concern being
expressed regarding the conduct of influence activities by EU Member States and no
corresponding anticipated national legislation to address this.
Finally, it should be underlined that a broader scope would not mean that exactly the same
measures would be provided for all interest representation activities as different situations may
justify different types of measures to adapt to different needs.
Stakeholder views:
1 CSO (out of 11) considered that harmonising interest representation in general “would be a crucial
first step in the right direction towards more transparency. However, they would not bring sufficient
transparency of lobbying by third countries (…). Stronger and more targeted legislation is needed.”
5.2.4.2. Exclusion of some entities from the scope
As proposed by 4 out of 11 CSOs consulted, it could be considered to exclude from the scope
some non-profit organisations carrying out interest representation (for example through a
127
See note 26, page 44.
128
See note 26, page 45.
129
See Annex 4, sections 2.2 for details.
130
See Annex 4, sections 2.3 for details.
131
See Annex 9.
26
threshold), in light of their specific role in a democratic society as part of the system of checks
and balances. This position is not shared by all CSOs consulted.
It can be understood from existing transparency registers, that CSOs form a large portion of
the entities carrying out interest representation activities (Non-governmental organisations
(NGO), think tanks, trade associations etc.)132
. Excluding CSOs carrying out interest
representation activities in the internal market from the scope would in addition create an
uneven playing field between the actors in the interest representation market (see section 2.1.1).
It would also create a risk of circumvention with some entities in a position of covertly
influencing decision-making on behalf of third countries in the EU while other entities carrying
out similar activities would be subject to transparency requirements.
Stakeholder views:
Industry representatives considered that “equal rules should apply to all organisations carrying out
interest representation activities. There are many examples in national jurisdictions where creating
exemptions has led to loopholes which malign interests use to circumvent transparency requirements.”
11 out of 15 Member States would prefer not to include such exemptions133
.
As this option would not be coherent with the internal market objective of this initiative and
would severely limit the effectiveness of the measure seeking to enhance transparency of
interest representation activities carried out on behalf of third countries, it should be discarded.
5.3. Description of the policy options
The proposed intervention would concern interest representation activities. It would cover a
broad range of activities conducted with the objective of influencing the development,
formulation or implementation of policy or legislation, or public decision-making processes in
the EU134
.
• It would include activities that aim to influence public decision-making both
directly (e.g. direct engagements with public officials) and indirectly135
(e.g. the
dissemination of research outputs136
, the organisation of and participation in
conferences/events, and the provision of education, training and cultural engagement,
when performed with the same objective). It would cover activities carried out online
and offline.
132
DE, IE, EL, FR, AT, RO and SI include CSOs in their national registers. In the EU transparency register 28% of registered
entities are NGOs, platforms and networks and similar (3 506 out of 12 540 registration), in national transparency registers,
Advocacy/charities represent 7.2% of all registered entities (873 out of 12 199 entities), see Annex 4, section 2.1 for details.
133
4 Member States (out of 15) propose to exclude some other entities from the scope. 2 of them want to exclude organisations
presenting certain group-specific interests like chambers of commerce or trade unions, 2 would like to do the same for
entities that carry out activities at the instigation of a functionary (e.g. responses to a public consultation), and 1 Member
State wants to exempt activities related to the protection of human rights and fundamental freedoms from the transparency
requirements.
134
The definition is inspired by Article 3(1) of the interinstitutional agreement of 20 May 2021 between the European
Parliament, the Council of the European Union and the European Commission on a mandatory transparency register.
135
A clear and substantial link should exist between the activity and the likelihood that it would influence a public decision-
making process in the Union. Account should be taken of factors such as the content of the activity, the context in which
it is conducted, its objective, the means by which it is carried out, or whether the activity is part of a systematic or sustained
campaign. The activities covered should not be limited to activities with the objective to promote a change in a given
policy, legislation but should also cover activities aiming to maintain the status quo.
136
As highlighted by the OECD: “One way in which different interests influence government policies is through financing
third-party organisations, such as think tanks, research institutions or research more generally, and grassroots
organisations. The aim is to contribute expert opinions, evidence and data, and public mobilisation to the policy-making
process. As with any other form of lobbying, however, there is a risk of undue influence. (…) This increases the risk of
providing biased or false information, with the aim of misleading or confusing public opinion or public officials”, see note
26, page 53. The OECD also notes that foreign governments “may also fund grassroots organisations, foundations,
academic institutions and think tanks to produce evidence supporting their goals”, ibid, page 44.
27
• It would cover only interest representation that seeks to influence decision-making in
the EU, regardless at which level (EU, national, regional or local level). It would not
cover activities carried out in the EU or in a third country that seeks to influence
decision-making in a third country.
• It would not cover activities that are connected with the exercise of official
authority, including activities related to the exercise of diplomatic relations
between States or international relations, nor would it cover the provision of
legal and other professional advice in the course of legal proceedings137
or
ancillary activities, which are activities that support the provision of an interest
representation activity but have no direct influence on its content (e.g. a caterer
supplying a lobbying event or intermediary service provided by an online
platform).
In line with the Article 114 TFEU legal basis, the legislative instrument would approximate
laws regulating the market for interest representation activities carried out on behalf of third
countries. The initiative does not prohibit the conduct of such activities but could deter them
as it provides common transparency (disclosure) standards. Illegal activities would remain
governed by other rules, for instance rules on corruption138
.
The legislative instrument would cover:
• Interest representation service provided to a third country entity. This would cover
interest representation activities normally provided for remuneration. Where
remuneration is provided, it would cover a large spectrum of different types of
consideration, such as loans, capital injection, debt forgiveness, fiscal incentives or tax
exemptions. Remuneration would also cover benefits in kind, such as the provision of
office space.
• The essential characteristic of remuneration lies in the fact that it constitutes
consideration (‘contra-prestation’) for the services in question139
. Contributions to the
core funding of an organisation or similar financial support, for example provided
under a third country donor grant scheme, would not be considered as remuneration
for an interest representation service where they are unrelated to an interest
representation activity, that is, where the entity would receive such funding regardless
of whether it carries out the specific interest representation activity at issue. Such
contributions would not be covered by this intervention. In line with the case law (and
to prevent circumvention), anything received in return for an interest representation
service should be considered as remuneration for the purposes of this legislative
intervention. This could cover financial contributions, such as loans, debt forgiveness
137
The distinction between interest representation activities of legal and other professionals and advice in the course of legal
proceedings would be based on the distinction established in Article 4(1)(a) of the interinstitutional agreement on a
mandatory transparency register. Legal advice and other professional advice are defined as advice in order to help ensure
that entities and their activities comply with existing legal requirements or to represent an entity in judicial or extra-judicial
proceedings. That means, while law firms are excluded from the scope of the legislative intervention when giving such
advice, they still fall within the scope if they conduct interest representation activities on behalf of a third country like
lobbying.
138
E.g. bribery of public officials on behalf of a third country or corruption (addressed by other initiatives, see e.g. Article 7
of the Proposal for a Directive on combating corruption, COM/2023/234 final). The harmonised transparency requirements
could however support the detection and prosecution of such illegal behaviours by relevant competent authorities,
including the circumvention of sanctions where interest representation activities are carried out for or on behalf of an entity
subject to restrictive measures.
139
Judgement of the Court of Justice of 27 June 2017, Congregación de Escuelas Pías Provincia Betania, C‑74/16,
EU:C:2017:496, paragraph 47 and the case-law cited.
28
etc., received in return for an interest representation activity. Remuneration could also
include benefits in kind, such as the provision of office space140
.
• It will be for national authorities to monitor whether the contributions to the ‘core
funding’ of an entity aim to circumvent the rules applicable to interest representation
activities. The advisory group of competent national authorities to be established would
be tasked with sharing best practices on relevant criteria and indicators to assess
circumvention. The Commission could also facilitate exchanges and sharing of
information and best practices. A specific provision will require Member States to
prohibit and sanction the circumvention of the obligations of the initiative.
Stakeholder views:
2 out of 11 CSOs that participated in the targeted consultation via a questionnaire considered
that “There should be a clear distinction, e.g., between receiving foreign funding to carry out
the mission of an organisation and the receipt of funding to represent someone as a service.
Legitimate CSO funding should not be considered as income for interest representation unless
it is provided specifically under such a contract.”
• Interest representation activities provided by an entity whose conduct can be attributed
to a third country government, and which is of a commercial or economic nature and
comparable to an interest representation service provided to a third country entity.
• Establishing specific safeguards: to avoid circumvention and ensure a level playing
field between actors, the following options would cover any natural or legal person
carrying out interest representation on behalf of third country entities. They would
cover different types of commercial entities (e.g. consulting firms, law firms, individual
businesses) and non-commercial entities (e.g. think tanks, education, research, cultural
and academic institutions, business, trade or professional associations, or CSOs). To
limit risks of gold plating and frame Member States’ action in this field, the legislative
intervention would provide for a full harmonisation. Supervision would be entrusted to
independent supervisory authorities with clearly established powers and national
authorities would need to ensure that no adverse consequences, such as stigmatisation,
arise from the mere fact that an entity falls within the scope of the legislative instrument.
For example, Member States would be prevented from requiring the entities that fall
within the scope of the initiative to register ‘as an organisation in receipt of support
from abroad’ or indicate on their internet site and in their publications and other press
material the information that they are organisations in receipt of support from abroad.
The right to judicial redress would also be guaranteed.
Stakeholder views:
1 CSO (out of 11) indicated that “the legal instrument should be delivered with clear and strong wording
against the negative labelling of the registered entities as “foreign agents” by Member States. It should
also prevent governments and policymakers from making disparaging statements in the press and/or in
campaigns that clearly aim to stigmatise these entities, especially CSOs and organisations that
represent minority groups. Additionally, the information provided by registered entities on the
transparency registers that are publicly available should be limited to what is strictly necessary and
presented in a “neutral” way to avoid stigmatisation.”
• Furthermore, strong safeguards would be included to address potential risks for specific
actors. To limit, among other, negative implications for entities active in third countries,
entities would be able to request that all or part of the information gathered for the
140
In such situations, the interest representation services provider would be responsible for estimating the value of the benefit
received, for example by reporting it using the market rate.
29
purpose of the transparency requirement is not made public based on an overriding
interest.
All the options would recommend or require Member States to provide for similar requirements
on transparency of interest representation carried out on behalf of third countries and address
SO1 (facilitate cross-border interest representation activities carried out on behalf of third
countries done transparently).
All the options would recommend or require Member States to provide for comparable and
publicly available information on the entities carrying out interest representation activities, the
activities conducted and the entities on whose behalf the activity is conducted141
and would
thus address SO2 (improve knowledge about the magnitude, trends and actors of interest
representation carried out on behalf of third countries).
Activities that are currently illegal or even criminalised in Member States, such as corruption,
would not be affected by this initiative. The harmonised transparency requirements could
however support the detection and prosecution of such illegal behaviours by relevant
competent authorities, including the circumvention of sanctions where interest representation
activities are carried out for or on behalf of an entity subject to restrictive measures.
5.3.1. Policy Option 1: Non-legislative measures
The first option considered takes the form of a non-legislative intervention142
.
This policy option would consist of recommending to Member States a set of measures to
be applied to interest representation activities carried out on behalf of third countries.
Member States would be encouraged to provide for similar and proportionate transparency
measures aimed at facilitating accountability and oversight and addressing the challenges for
democratic processes associated with such activities. This could include, for example, a
recommendation to Member States with lobbying registers to request interest representatives
to provide, on a voluntary basis, an indication in their lobbying registry of whether the interest
represented is that of a third country, and to other Member States to establish, on a voluntary
basis, registers covering activities affecting decision-making processes funded by third
countries. The recommendations would also include references to safeguards that Member
States should establish, including to prevent stigmatisation of the registered entities.
This policy option would build upon and be complementary to the recommendations that have
been issued by the Commission in the context of its annual Rule of Law Reports regularly
inviting Member States to introduce or improve rules on lobbying and interest representation.
Additionally, this policy option would go beyond these recommendations as it provides for a
list of specific standards related to record-keeping, registration and transparency (1), a detailed
but voluntary reporting on the application of the specific standards (2) and a monitoring of the
implementation of the recommendation (3). It would also include references to safeguards that
Member States should establish, including to prevent stigmatisation of the registered entities.
Due to the non-binding nature of the initiative, Member States could rely on the EU
Recommendation while not being bound by law regarding the necessary safeguards when
implementing the recommended standards. Hence, there is a risk of gold-plating.
141
10 Member States (out of 15) have pointed out that it is in the interest of the general public to have more transparent and
accessible information about interest representation activities carried out in the EU on behalf of third countries.
142
3 Member States (out of 15) have expressed preference for this option. An additional 2 Member State seem to prefer a
recommendation instead of a legislative intervention as well. Only 1 CSO (out of 11) prefers this option and none of the
industry supports it.
30
Appropriate monitoring of implementation of the Recommendations would be conducted. A
report would assess the effects of the Recommendation and consider other measures including
possible future legislation.
Use would be made of existing expert groups as governance structures. The Commission would
be able to rely on exchanges on the implementation of the voluntary measures to support their
take up in existing networks, such as the European Cooperation Network on Elections or the
membership of the Rule of Law contact group and on the reporting by the Commission on the
follow-up given to the Recommendation.
5.3.2. Policy Option 2: Legislative intervention
The second policy option takes the form of a legislative intervention harmonising the
requirements143
in the internal market, based on Article 114 TFEU. It would not seek to
directly prevent interest representation activities carried out on behalf of third countries but
would provide transparency requirements for entities carrying out such activities. With regard
to the transparency and related obligations, two options are possible: targeted requirements
(PO2.1) or extended requirements (PO2.2).
5.3.2.1. Policy Option 2.1: Targeted requirements144
Entities carrying out interest representation activities on behalf of third country entities would
be required to register and keep certain records. In addition, interest representation service
providers would have the possibility to take measures to identify the recipients of the
services.
▪ Record-keeping: Entities would be required to keep, for a reasonable period, information
on the identity of the entity on whose behalf the activity is carried out, a description of
the purpose of the interest representation activity, contracts and key exchanges with the
entity to the extent that they are essential to understand the nature and purpose of the interest
representation carried out, as well as information or material constituting key components
of the interest representation activity.
▪ Registration: Entities would be required to register in a national register and provide
information145
on themselves, the activities conducted, and the entities they conduct the
activities on behalf of.
− On the entity: information could include name, contact details, category of
organisation (e.g. law firm, consultancy, think tank etc.), address of the place of
establishment, etc.
− On the activity: information could include the type of activity provided, the
Member States in which it will be carried out (the Member State of registration
should notify the Member State where the activity is performed), the policy sought
to influence, the remuneration received covering all the tasks carried out with the
objective of influencing the development, formulation or implementation of the
143
6 Member States (out of 15) have explicitly expressed preference for harmonised requirements at EU level. An additional
3 Member States have expressed support for requirements that would require a legislative intervention. 4 CSOs (out of 11)
are explicitly against such legislative intervention while 2 are in favour. All three industry representatives are in favour of
establishing harmonised measures at EU level.
144
6 Member States (out of 15) as well as 2 industry representatives (out of 3) have explicitly expressed preference for targeted
requirements. 2 CSOs (out of 11) consider that transparency requirements should differ according to the level of risk that
entities might pose for foreign interference. 3 CSOs consider that any potential regulation should not impose overly
burdensome and additional financial or narrative reporting on CSOs.
145
The specific information to be included in the registration could be adapted through a delegated act.
31
same proposal, policy or initiative, where relevant, the name of the service provider
entrusted with the publication or dissemination of information to the public (such
as a newspaper).
− On the entity on whose behalf the activity is carried out: information could
include their name, contact details and the third country on whose behalf the entity
is acting.
Upon registration, the entity would receive a registration number that could be used
throughout the internal market, which would serve as a mean to facilitate the identification
across the Union of entities registered pursuant to the legislative initiative. The format of
such number could be specified in the legislative initiative (e.g. in an Annex), and should
include a country code. Existing registration numbers that may be issued by Member States
regulating interest representation would still be maintained for those activities falling
outside the scope of the legislative initiative. Entities would need to include such national
registration numbers as part of their registration.
Information necessary for the enforcement, such as the name and address of the entity,
would need to be updated regularly. Other information would need to be updated at least
annually.
The information necessary to ensure public accountability would be made public.
Information that would not be necessary to ensure public accountability, such as certain
type of personal data, would only be accessible to supervisory authorities to facilitate
enforcement.
▪ Transparency: Entities carrying out interest representation as well as their subcontractors
would have to provide their registration number when in direct contact with public
officials.
Member States would be required to ensure that publicly available national registers are
in place and that they cover the information and reporting requirements included in the
intervention. They would need to designate or set up supervisory authorities ensuring
proper implementation. Member State authorities could also be required to participate in
the established governance and information sharing structures. Where available,
Member States should be able to make use of existing transparency registers. Depending
on their organisation, they should be able to establish one or multiple registers.
To facilitate coordination and access to the registers, where an entity carries out activity in
a Member State other than that of registration, the Member State of registration should
notify the Member State where the activity is performed of the name of the concerned
entity, its registration number and the link to the national registers where the registration
took place. That Member State should include in its own register the information laid down
in that notification.
▪ Reporting: In order to increase transparency and accountability of the magnitude, trends
and actors of interest representation activities carried out on behalf of third countries,
Member States would need to publish an annual report based on the data entered in the
register146
. This annual report could include aggregated data on the annual amounts per
third country and per category of organisation for each third country in the preceding
financial year.
146
The specific information to be included in the annual report could be adapted through a delegated act.
32
A risk-based approach: To enable Member States to monitor interest representation activities that are
particularly likely to have a significant influence on public life and public debate, supervisory authority
should be able to request the records kept by entities carrying out interest representation activities on
behalf of third countries if: (i) these entities receive more than EUR 1 000 000 from a single third
country entity in the preceding financial year or (ii) when they carry out interest representation activities
for a third country entity whose action can be attributed to a third country that has spent a EUR 1
500 000 on interest representation in a Member State or EUR 8 500 000 in the EU as a whole in
one of the last 5 years. Entities that receive, in the preceding financial year, an aggregate remuneration
of less than EUR 25 000147
would not be covered by this risk-based approach.
The reasoning behind the establishment of the different threshold levels is detailed in Annex
7. It can be summarised as follows:
o The EUR 1 000 000 and EUR 25 000 (de minimis) thresholds come from an analysis of
data of the EU Transparency Register. They respectively would create a possibility for
additional scrutiny over the 2.5% largest relevant entities, while excluding the 36%
smallest relevant entities from the scope of the information requests requirements.
o The EUR 8 500 000148
and EUR 1 500 000149
thresholds were obtained by extrapolating
data from the closest existing benchmark available, the US FARA, adapted to account for
the specificities of the internal market.
Governance, supervision and sanctions: At national level, Member States would be required
to establish or designate one or more authorities responsible for national registers and
one or more independent supervisory authorities150 responsible for the supervision and
enforcement of the Directive. They could also designate the same authority for both tasks and
they could rely on existing authorities, as long as the requirements of the initiative are complied
with. The policy option would also include appropriate monitoring and enforcement
mechanisms, for instance where a supervisory authority has reliable information of possible
non-compliance by an entity it may ask that entity to provide the records kept necessary to
investigate the possible non-compliance. Reports of breaches or attempts to circumvent the
obligations by whistle-blowers would be possible. The initiative would provide for cross-
border cooperation and information sharing mechanisms among supervisory authorities
from different Member States. The Internal Market Information System (‘IMI system’)
Regulation would support the administrative cooperation and the exchange of information
using existing IT tools. At the EU level, a governance cooperation mechanism (e.g. an
advisory group chaired by the Commission) would be established to facilitate exchanges and
cooperation between the Member States supervisory authorities and ensure interoperability of
the data collected. Among other things, they would exchange best practices on the technical
arrangements for the national registers. The advisory group would also assist the Commission
on possible guidance on the implementation of the Directive. The initiative would not envisage
a direct enforcement role for the Commission. The Commission would be responsible for
147
These thresholds could be adapted based on a delegated act. For more see Annex 7.
148
The analysis found that 11 selected third countries spent an average the equivalent EUR 11 284 730.04 in 2020 (latest year
for which data was available) on core interest representation services. The EU’s economy in 2020 was 25% smaller than
the US’, resulting in an equivalent of EUR 8 463 547.53, which was rounded up to establish the threshold of EUR 8 500
000.
149
The threshold of EUR 1 500 000 was found by dividing the EUR 8 500 000 threshold by the share of GDP of each Member
State. Based on this, the resulting threshold for France was used as a benchmark, rounded up, namely of 16.72% of EU
GDP in 2022 or EUR 1 421 200, to establish the threshold of EUR 1 500 000. Importantly, the Directive foresees that this
threshold can later be adapted by a Delegated Act, once more data is available after its entry into force. Setting a high bar
at first permits to scope in fewer entities and reduce risks of overburdening.
150
Responding to the questionnaire sent by the Commission, 1 CSO (out of 11) indicated that “the establishment of an
independent oversight body would ensure that the transparency register is regularly and properly monitored”.
33
publishing a summary of the data received from the Member States and a list of third countries
in the context of the risk-based approach. However, to efficiently monitor the implementation
of the legislative initiative and improve the knowledge on the size and distribution of the overall
interest representation activities that are carried out on behalf of third countries in the Union;
the Commission will be able to request data from Member States.
Sanctions would be fully harmonised administrative fines which would represent a maximum
of 1% of the entities’ annual worldwide turnover. Sanctions would take into account the nature,
recurrence and duration of the infringement in view of the public interest at stake, the scope
and kind of activities carried out, and the economic capacity of the entity carrying out interest
representation activities.
The sanctions regime shall in each individual case be effective, proportionate and dissuasive,
with due respect for fundamental rights including freedom of expression, association, academic
freedom and freedom of scientific research, safeguards and access to effective remedies,
including the right to be heard. This option would ensure that entities would not be exposed to
the threat of criminal penalties or dissolution.
A detailed explanation on the reasoning around the maximum sanctions amount of 1% of the
entities’ worldwide turnover is provided in Annex 7. In essence, this was determined by
analogy with the Digital Services Act’s Article 52(3)151
which similarly relates to issues with
information disclosures.
Stakeholder views:
1 out of 11 CSOs indicated that “administrative sanction is the most proportionate option to deter
misconduct. The receipt of funds is not in itself a criminal office, so a criminal sanction would be
disproportionate.”
On the harmonisation of sanctions, out of the 15 Member that answered the questionnaire 4 prefer not
to harmonise administrative fines while 3 are in favour. The remaining 8 did not pronounce themselves
on the issue.
5.3.2.2. Policy Option 2.2: Extended requirement
Entities carrying out interest representation activities on behalf of third country entities would
face the same requirement as in PO2.1, they would also face some additional requirements.
▪ Record-keeping: In addition to the elements included in PO2.1, these entities would be
required to keep records of all contracts and exchanges (written and oral) with the entity
on whose behalf the activity is carried out as well as all information or material on the
interest representation activity.
▪ Prior authorisation / licencing:152
For each new interest representation activity above a
certain financial threshold, these entities would have to apply to the competent national
authority for a licence to conduct said activity.
− The request would require submitting the same information as those provided
under the registration of PO2.1.
151
DSA Article 52(3): “Member States shall ensure that the maximum amount of the fine that may be imposed for the supply
of incorrect, incomplete or misleading information, failure to reply or rectify incorrect, incomplete or misleading
information and failure to submit to an inspection shall be 1 % of the annual income or worldwide turnover of the provider
of intermediary services or person concerned in the preceding financial year”.
152
4 Member States (out of 15) and 1 CSO (out of 11) are in favour of a prior authorisation/licensing system, 6 Member
States, 5 CSOs and 1 industry representative (out of 3) have expressed themselves against such mechanism.
34
− Licences would be refused only where in light of the information provided and of
the entity(ies) the interest representation is carried out for (taking into account,
where applicable the risk-based approach) the activity is likely to seriously affect
public security153
.
− To support the decision-making process regarding the refusal of a license and ensure
consistency in the EU, the legislative instrument would create a cooperation
mechanism154
whereby, the competent authority in the Member State assessing the
application would notify the other Member States’ authorities and the Commission.
Other Member States would be able to submit comments if the activity is likely to
seriously affect public security in their Member States. The Commission may issue
an opinion if, based on the information transmitted by the concerned Member
States, the activity is likely to seriously affect public policy in a Member State.
− Where a licence is granted despite comments submitted by a Member State or an
opinion from the Commission, a publicly available flag would be added in the
registration of the said entity.
− Entities would receive a licence number that could be used throughout the internal
market. In the same condition as in PO2.1, upon obtaining the licence, the
information provided by the entities would be published in national transparency
registers.
− The failure to abide by these requirements would lead to significant penalties.
▪ Transparency: As in PO2.1, these entities as well as their subcontractors would have to
provide their licence number when in direct contact with public officials.
Risk-based approach: Entities carrying out interest representation activities on behalf of third
countries would be required to automatically share all the records when they fulfil the
conditions of the risk-based approach set out in PO2.1.
Governance, supervision and sanctions: building on PO2.1, this option would require
Member State authorities to set up a prior authorisation/licencing system.
6. WHAT ARE THE IMPACTS OF THE POLICY OPTIONS?
6.1. The baseline scenario
The dynamic baseline scenario is already presented under the section dedicated to the problem
definition and its evolution (see sections 2 and 3.2), while Annex 9 provides a detailed
description of the measures currently in place or proposed in this area.
Even existing initiatives and legislation at EU level (from the European Democracy Action
Plan and beyond) would continue to ensure transparency of certain attempts of foreign
influence, such transparency would leave an important part uncovered – the role of interest
representatives or lobbyists. Interest representation activities would not be effectively covered
by the following instruments:
153
The concept of public security covers both a Member State’s internal and external security and threats to the functioning
of the institutions and essential public services and the survival of the population, as well as the risk of a serious disturbance
to foreign relations or to peaceful coexistence of nations, or a risk to military interests (Judgment of the Court of Justice
of 23 November 2010, Tsakouridis, C-145/09, paragraphs 43 to 44).
154
This mechanism is inspired by the FDI regulation, see note 23.
35
- the Political Advertising Regulation would not cover interest representation activities
which do not also qualify as ‘political advertising’ (e.g. lobbying);
- the European Media Freedom Act would not ensure transparency of instances where
a third country obtains interest representation activities from a media service provider;
- the Digital Services Act would not cover providers of interest representation activities
covered by the initiative as they are not ‘intermediary services’;
- the Audiovisual Media Services Directive155
(AVMSD) would not cover interest
representation activities given that advertising campaigns covered by the notion of
interest representationare unlikely to fall within the scope of the AVMSD, whose
advertising rules are focused on the promotion of goods and services;
- The EU transparency register would continue to apply. However, such Register is not
binding, and the standards are limited to interest representation activities directed at EU
institutions and its decision-makers. Interest representation activities carried out with
the objective of influencing national policy, legislation or decision-making processes
would not be covered.
The EU’s toolbox to tackle Foreign Information Manipulation and Interference (FIMI Toolbox)
would continue to inventory the EU’s approach to FIMI and disinformation. However, in the
absence of an initiative on interest representation, it would not benefit from the data obtained
through this initiative, which could support developing an overview of such activities when
used to manipulate or interfere.
In a nutshell, other initiatives would not address the objective of reducing the fragmentation in
the regulation of cross-border interest representation activities carried out on behalf of third
countries in the internal market (which is expected to increase). As regards the objective of
improving knowledge about the magnitude, trends and actors of interest representation carried
out on behalf of third countries, the existing initiatives at EU level do not address the lack of
an overall understanding of the phenomenon and the specific collection of data.
Furthermore, any interventions at Member State level would not necessarily be equipped with
the robust safeguards envisaged by the initiative and may result disproportionate.
6.2. Assessment of the options
The policy options were evaluated for the following economic, social, fundamental rights and
geopolitical impacts. The assessment of impacts did not identify any relevant environmental
impacts. The options will therefore respect the “do no significant harm” principle and is
consistent with the climate neutrality objective, its intermediate targets and the adaptation
objectives as set out in the European Climate Law156
.
6.2.1. Economic impacts
6.2.1.1. Functioning of the internal market
All 3 options would have a positive effect on the functioning of the internal market.
The 2 legislative options (PO2.1and PO2.2), and, assuming that its recommendations are
followed, the non-legislative option (PO1), would result in similar transparency requirements
155
Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on the coordination of certain
provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual
media services (Audiovisual Media Services Directive) (OJ L 95, 15.4.2010, p. 1).
156
Regulation (EU) 2021/1119 of 30 June 2021 establishing the framework for achieving climate neutrality (European
Climate Law).
36
in all Member States, thereby levelling the playing field and limiting the risks of regulatory
arbitrage. However, unlike the legislative measures in Option 2.1 and Option 2.2, Option 1
would not provide entities with a registration number that could be used throughout the internal
market; entities carrying out interest representation on behalf of third countries cross border
would still need to comply with different rules, including registration requirements, in the
different Member States in which they operate.
The legislative measures PO2.1 and PO 2.2), by providing fully harmonised transparency
requirements, would reduce the costs resulting from legal fragmentation and uncertainty for
economic actors, thereby facilitating the offering of interest representation activities on behalf
of third country entities across borders. In addition, these harmonised requirements would add
legal predictability for interest representation activities carried out on behalf of third country
entities in several Member States. In particular, the possibility to obtain a registration number
that could be used throughout the internal market would remove the need for multiple
registrations157
. This would imply that for each Member State (outside the Member State of
main establishment where a registration is currently required) in which an entity carries out
interest representation on behalf of third countries, that entity would be able to obtain some
savings due to synergies permitted by similar registration and information disclosures
requirements158
.
Stakeholder views:
1 CSO (out of 11) considered that “the introduction of harmonised measures at EU level can increase
coherence (…) and would reduce the compliance burden for companies that previously had to register
in different Member State with different requirements and obligations.”
By providing the same level of transparency and supporting coordination among competent
authorities, both of these options contribute to improving the regulatory outcome with regard
to interest representation activities carried out on behalf of third country entities.
The licensing/prior authorisation system set out in the legislative option PO2.2, could lead to a
limited regulatory arbitrage as economic actors might seek to obtain said licence in more
lenient jurisdiction159
.
6.2.1.2. Competitiveness
All 3 options are expected to have a positive impact on the competitiveness, innovation and
investment in cross-border interest representation activities carried out on behalf of third
countries. By levelling the playing field and reducing the compliance costs linked to cross
border activities, they will enable existing national enterprises to scale up. By increasing
157
To facilitate coordination and access to the registers, where an entity carries out activity in a Member State other than that
of registration, the Member State of registration should notify the Member where the activity is performed of the name of
the concerned entity, its registration number and the link to the national registers where the registration took place. That
Member State should include in its own register, the information laid down in that notification.
158
Cross-border companies will be subject to reduced administrative burden in these additional Member States stemming
from: (i) The need to provide exactly the same information (i.e. when operating on behalf of a given third countries in
multiple Member States). In this scenario, the costs of registration and information disclosure for additional Member States
would be limited solely to the submission of information as there would be no need to collect additional information. (ii)
The need to provide different information but for the same types of information (i.e. when operating in different Member
States on behalf of different third countries). In this scenario, likely minor efficiency gains would be possible, for instance,
through the use of the same information recording and retrieval systems across all Member States. However, entities would
still be required to conduct the same internal liaison and information collection tasks, as well as the information submission
tasks. Annex 4 provides further details on the analysis of costs and savings.
159
Where a licence is granted despite comments submitted by a Member State or an opinion from the Commission that the
activity is likely to seriously affect public security, a publicly available flag would be added in the registration of the said
entity.
37
transparency, they would decrease popular distrust in these activities, strengthening the
attractiveness of entry to this market.
In particular, the legislative measures (PO2.1 and PO2.2), by fully removing the obstacles
resulting from legal uncertainty and fragmentation, as well as reducing the need for multiple
registration would help create a stable market to enable SMEs to scale up their operations and
stimulate the development of new services offered at EU level.
All 3 policy options would only provide for transparency requirements and would thus have
no impact on the capacity to innovate of the entities falling within their scope.
6.2.1.3. Costs and administrative burdens for economic actors (+SMEs)
All 3 options would add compliance costs for economic actors providing activities which are
in scope. These are expected to be compensated by the efficiencies realised from the removal
of legal fragmentation that facilitate the cross-border provision of interest representation
activities on behalf of third countries, in particular with regard to the legislative policy options
(see section 6.2.1.1).
In light of the removal for the need for multiple registrations, the net expected result is a cost
reduction against the baseline for the legislative policy options.
The extended requirements of PO2.2 introduce a prior authorisation/licencing system over the
other options and the baseline. By having the possibility to refuse to authorise an interest
representation activity that is likely to seriously affect public security, this option would create
a positive reputational impact for economic actors that have been granted a licence, which
could be leveraged for commercial gains.160
Annex 4 details the methodology used to determine the costs for economic actors.
Table 3: Estimates of costs for obligations addressed to economic actors.
Type of cost Option 1(*)
:
non-legislative
measures
Option 2.1:
targeted legislative
requirements
Option 2.2:
extended legislative requirements
Familiarisation
costs
Basic familiarisation costs:
Entities that carry out interest representation activities will conduct some basic
familiarisation with the new regulatory framework to assess whether their
operations would fall into scope. Such cost would be around EUR 20 to 60 per
organisation161
.
Extended familiarisation costs:
Entities concerned by the new regulatory framework would need to assess the
practical implication, develop compliance strategies and allocated responsibilities
for compliance related tasks. These costs would be around EUR 80 to 240 per
organisations162
Record
keeping
N/A Establishing and implementing record keeping processes:
Concerned entities would need to identify and assess the risks
related to each new engagements and then implement a record
keeping process. While there would be a need to formalise these
processes, stakeholders confirmed that these costs could be
considered as business as usual163
.
160
5 CSOs underlined that any requirements to obtain a licence would place an important burden on smaller actors involved
in interest representation, including not-for-profit organisations.
161
See Annex 4, section 2.2 for details.
162
See Annex 4, section 2.3 for details.
163
See Annex 4, section 4.2 for details.
38
Registration Registration costs:
In the 15 Member States that currently maintain a transparency register, entities
would need to update their registration. In the 12 other Member State, they would
need to register. In all 27 Member States, concerned entities would need to
regularly update their registration. Furthermore, the larger the firm, the more
complex and costly the reporting process. The total registration would thus cost
around EUR 828 per organisation per year for small entities164
, EUR 1 686 for
medium entities165
and EUR 3 314 for large entities166
. 97.3% of entities falling
under the scope of the initiative would be small entities167
.
Prior
authorisation
/licencing
N/A N/A Within the application for a licence,
concerned entities would be required to
submit the same information as under the
registration obligations. Thus, the core
activities, and direct costs, stemming from
the prior authorisation/licencing system
would be covered by the “Registration”
cell above.168
(*) For the purpose of this table, it is assumed that Member States enact legislation to adopt the transparency
measures recommended in Option 1. Further analysis is provided in Annex 4.
SME test
It is not possible to fully exempt SMEs from the transparency requirements as they are
important actors in the market for interest representation activities carried out on behalf of third
countries169
. Legal fragmentation in the internal market for entities carrying out interest
representation activities on behalf of a third country is a significant barrier for SMEs,
amounting to prohibitive legal and financial obstacles to such enterprises. SMEs are also more
affected by policies established by some Member States which require entities carrying out
interest representation to registered in that Member State.
The obligation to maintain updated registration included in all 3 options involve an ongoing
compliance cost. While the ongoing costs depend on the number of interest representation
activities carried out on behalf of third countries, the described cost affect SMEs
proportionately more than other actors.
The legislative options (PO2.1 and PO2.2) offer more opportunities for such costs to be offset
by savings resulting from simplification of the rules and the elimination of the need for multiple
registration when offering activities across borders. This would increase cross-border activity
in particular for SMEs, which could offer their activities to clients outside their Member State
of establishment and would have the opportunity to scale up to operate at EU level. Support to
164
Defined as having less than 10 full-time equivalent personnel (FTEs) working on interest representation activities.
165
Defined as having between 10 and 20 full-time equivalent personnel (FTEs) working on interest representation activities.
166
Defined as having more than 20 full-time equivalent personnel (FTEs) working on interest representation activities.
167
See Annex 4, section 2 for details.
168
Within the application for a licence, entities within scope would be required to submit the same information as under the
registration obligations of policy option 2.1. While this could lead to hassle costs (e.g. from delaying the provision of
services), the core activities, and direct costs, stemming from the prior authorisation / licencing system would be covered
by the registration and information update costs detailed above. Annex 4 provides further details on this analysis.
169
In its answer to the Commission’s questionnaire, 1 CSO underscored that “all entities involved in interest representation
and receiving funding from governments should be equally accountable, which means that transparency requirements
should apply to all bodies involved in the EU legislative process. However, small and large actors should not be in unequal
situations in terms, amongst others, of the administrative burden of registering. According to the principle of
proportionality and equality, SMEs and other small actors should benefit from the removal of unnecessary burdens.”
Additionally, no Member State argued that SMEs should benefit from a derogation and only 1 Member State (out of 15)
emphasized that “additional excessive administrative burdens on CSOs, social partners, and SMEs” should be avoided.
All 3 industry representatives are not in favour of any specific exemptions for certain entities or of any de minimis
threshold.
39
compliance to transparency requirements would be offered by competent national authority,
notably on the notion of third country entity or on the scope.
To limit administrative burden, in particular for SMEs, an obligation would be introduced to
make information on the registration obligations and formalities established by the legislative
options available via the Single Digital Gateway170
which, through the Your Europe web portal,
sets up a one-stop-shop that provides businesses and citizens with information about rules and
procedures in the Single Market, at all levels of government and direct, centralised, and guided
access to assistance and problem-solving services as well as to a wide range of fully digitised
administrative procedures. In addition, the procedure for registration is fully online and
organised in accordance with the ‘once only’ principle to facilitate the reuse of data.
Finally, the risk-based approach and, in PO2.2, the prior authorisation/licencing would be
subject to a de minims, to avoid imposing excessive burden on SMEs.
6.2.1.4. Costs for public authorities of measures addressed to economic
actors.
The 2 legislative options (PO2.1 and PO2.2) would aim to streamline oversight, providing
better access to needed information, more opportunities for coordinated action and resource-
sharing and clarity about the responsible authority. This would result in more effective
regulatory outcomes. It also provides support to Member State authorities to request
information and facilitate cross-border oversight via the Internal Market Information
System171
, while focusing on entities whose main establishment lie in their jurisdiction.
As detailed in Annex 4, it could result in some costs for national authorities: one-off
familiarisation costs, 15 Members States that have a publicly accessible transparency register172
would have a one-off cost to amend their regime, while the 12 other Member States173
would
need to establish such register. All Member States would need to maintain the registers and
maintain appropriate management, monitoring and enforcement mechanisms174
. These costs
are expected to be partialy offset against the efficiency savings expected from the harmonised
obligations and streamlined and strengthened oversight process.
If fully implemented, PO1 would lead to the same costs as the targeted requirements in Option
2.1without the benefits stemming from the streamlined oversight and cooperation systems.
Should the recommendation under PO1 not be implemented fully, the costs under a scenario
of 50% take up by Member States has also been assessed, which would lead to lower costs for
Member States authorities175
.
In addition to the costs and benefit of the PO2.1, the extended requirements of PO2.2 introduce
some additional specific obligations over the other options and the baseline which would imply
additional costs.
170
Regulation (EU) 2018/1724 of the European Parliament and of the Council of 2 October 2018 establishing a single digital
gateway to provide access to information, to procedures and to assistance and problem-solving services and amending
Regulation (EU) 1024/2012.
171
Regulation (EU) 1024/2012 of the European Parliament and of the Council of 25 October 2012 on administrative
cooperation through the Internal Market Information System and repealing Commission Decision 2008/49/EC (‘the IMI
Regulation’).
172
IE, EL, ES, FR, IT, CY, LT, LU, NL, AT, FI, DE, PL, RO, SI.
173
BE, BG, CZ, DK, EE, HR, LV, HU, MT, PT, SK, SE.
174
See Annex 3, section 3.1 for details.
175
Details on the costs analysis in that 50% take up scenario are provided in Annex 4.
40
6.2.2. Social impacts
6.2.2.1. Transparency of interest representation activities carried out on
behalf of third countries
The 2 legislative options (PO2.1 and PO2.1), and assuming that its recommendations are
followed, the non-legislative option (PO1) enhance the transparency of interest representation
activities carried out on behalf of third countries. As voters, citizens are important decision-
makers in their own right, and as such, they can be the target for certain interest representation
activities. By revealing the information on the interest representation activity conducted and
the entity on whose behalf the activity is carried out, all 3 options would enable citizens and
public officials to easily recognise influence campaigns by third countries thereby contributing
to the integrity of, and public trust in, EU and Member State decision-making processes. It
would support oversight by competent authorities as well as scrutiny from interested actors
(including CSOs, political actors, researchers, elections observes or journalist) to monitor
interest representation activities carried out on behalf of third countries. The strengthening of
the quality of information available would help enrich the political debate.
Stakeholder views:
10 Member States (out of 15) pointed out that it is in the general interest of the society to know about
interest representation activities on behalf of third countries seeking to influence the formulation or
implementation of policy or legislation or public decision-making processes in the EU. For example, 1
of them emphasized that “it is not sufficient that only decision-makers have access to such information.
Such access should be made available to every person interested to be informed about lobbying
activities, while, at the same time respecting any limitations with regard to confidentiality or GDPR.”
The 2 legislative options (PO2.1 and PO2.2) could have limited impacts on the confidentiality
of the registered entity. However, no derogation to confidentiality requirements will be sought.
If such requirements apply, entities will be able to refer to them in order to not have their data
published in the register or to have only a limited set of data published. Furthermore, financial
amounts would be published in ranges, since publicity on the granularity of the specific
amounts paid is not strictly needed for the objective of public accountability.
The 2 legislative options (PO2.1 and PO2.2) would require entities carrying out interest
representation on behalf of third country entities to provide their registration number when in
direct contact with public officials.
Stakeholder views:
5 out of 11 CSOs considered that a requirement for all registered entities to provide their registration
number when in direct contact with public officials would unduly restrict CSOs access to policy-
making. 5 out of 15 Member States expressed similar concerns. 6 Member States actively support such
requirements. According to 1 of them “this would help ensure transparency and accountability in
lobbying activities.”
Neither of these two policy options would regulate the transparency or ethical requirements
that Member States may imposed on public officials. Except when carrying out interest
representation activities on behalf of third country entities, concerned entities would be free to
interact with public official without additional requirements under EU law. The requirement
would be limited to providing the registration number and would ensure that decision-makers
can easily access the information on the interest represented, and thus critically analyse the
content to which they are exposed and make informed choices. It would not unduly restrict
access to public officials.
41
By providing for similar transparency requirements in each Member States, and thus limiting
forum shopping, the 3 options would ensure that entities do not carry out interest representation
on behalf of third countries covertly.
6.2.2.2. Improve knowledge about the magnitude, trends and actors of
interest representation activities carried out on behalf of third
countries
The 2 legislative options (PO2.1 and PO2.2), and assuming that its recommendations are
followed PO1, would improve knowledge about the magnitude, trends and actors of interest
representation activities carried out on behalf of third countries, by providing for publicly
available data on such activities. In particular, Members States would be able to establish
aggregate data on the interest representation activities being carried out, the decision-making
processes targeted, the amounts spent by each third country. They will enable journalists,
CSOs, researchers as well and national or European authorities to map the entities carrying out
interest representation on behalf of each third country as well as the means, such as a newspaper
or online platform disseminating ads, by which the content of an interest representation is being
disseminated to the public. They will be able to assess the evolution of that market over the
years. The publication of some of these aggregate amounts and the establishment of machine-
readable176
register would strengthen of the quality of information available on this subject,
help enrich the political debate and inform future policy-making. This information could also
serve to build capacity and help citizens and policy-makers understand and, where relevant,
react to influence campaign of third countries.
The 2 legislative options (PO2.1 and PO2.2), would greatly facilitate comparison between
Member States and establishing trends at EU level, by providing identical information to be
provided upon registration, and promoting harmonized publication standards of aggregated
data through their respective governance cooperation mechanism. These legislative options
also provide for a flexible and evolutive approach to this data collection by enabling to adapt
the information requested upon registration as well as the aggregate data to be made public
through for delegated act.
By providing for an early assessment of the information provided, the prior authorisation
system in PO2.2 would ensure that the information provided in the register is correct and
complete and would further the knowledge on the magnitude, trends and actors of interest
representation activities carried out on behalf of third countries.
6.2.2.3. Enforcement and supervision by authorities
By limiting the risk of forum shopping (see section 6.2.1.1 above), PO1 would be a limited
improvement compared to the baseline, as interest representatives are less likely to direct their
operations towards less regulated Member States, enabling Member States to better monitor
interest representation activities carried out on behalf of third countries in their jurisdiction.
The 2 legislative options (PO2.1 and PO2.2), entail further improvement by strengthening
regulatory coordination among competent authorities especially via the establishment of a
governance cooperation mechanism such as an advisory group, and information sharing
176
Information should be considered machine readable if it is provided in a format that software applications can automatically
process, without human intervention, in particular for the purpose of identifying, recognising and extracting specific data
from it.
42
structures. This would ensure that oversight on a common set of transparency requirements is
better coordinated among national authorities177
.
In addition, both legislative options provide for gradual enforcement mechanism thanks to a
risk-based approach. In PO2.1, supervisory authorities would be able to request, without any
justification, the records kept by entities fulfilling the risk-based approach criteria. In PO2.2,
entities in the scope of the instrument would also be required to keep records of all contracts
and exchanges with the third country entity, if they fall within the scope of the risk-based
approach, and these entities would be required to automatically share all of these records.
These provisions will facilitate the enforcement of the transparency requirements with regard
to entities that carry out interest representation activities that are particularly likely to have a
significant influence on public life and public debate. It will also enable authorities to have
access to contracts and key exchanges enabling them to better understand and supervise interest
representation activities carried out on behalf of third countries. The risk-based approach would
be flexible and evolutive, as the threshold could be modified via a delegated act using the data
collected over time.
Stakeholder view:
7 out of 11 CSOs and all of the industry representatives who answered the questionnaire (3) highlighted
the risk of circumvention. 2 of them stated that in the absence of transparency standards applicable to
all forms of interest representation “external entities will invariably discover avenues to wield their
influence, notably through private entities registered within EU Member States”.
By conditioning interest representation to the respect of transparency requirements, all 3 policy
options (assuming that the recommendations in PO1 are implemented through legislation)
would ensure that interest representatives do not carry out interest representation activities on
behalf of third countries covertly. In the 2 legislative options (PO2.1 and PO2.2), the risk of
circumvention would be limited thanks to the broad notion of third country entity. This notion
would include public or private entities, including EU citizens and legal persons established in
the EU, whose actions can ultimately be attributed to a central government or public authorities
of a third country178
. Guidance could be offered by competent national authorities, to help
concerned entities apply this concept. Where a supervisory authority has reliable information
of possible non-compliance, e.g. a private entity registered in the EU trying to cover up its work
on behalf of third countries, it may ask that entity to provide the records kept necessary to
investigate the possible non-compliance. These 2 policy options would also enable reports of
breaches or attempts to circumvent the obligations by whistle-blowers179
.
By having the possibility to refuse to authorise an interest representation activity that is likely
to seriously affect public security, the legislative option PO2.2 would enable supervisory
authorities to prevent activities that could pose a threat to the functioning of the institutions and
essential public services, as well as the risk of a serious disturbance to foreign relations or to
peaceful coexistence of nations.
177
1 Member State (out of 15) considered that a network for national supervisory authorities “should serve as a platform for
regular exchange of information and structured cooperation between supervisory authorities”.
178
The concept is inspired by Article 3(3) of Regulation on foreign subsidies distorting the internal market, see note 3.
179
2 CSOs (out of 11) support such compliance mechanism, 1 of them stating: “CSOs and human rights defenders, in their
quality as trusted actors that contribute to the promotion and protection of democratic standards, should be put in a
position to report to supervisory authorities any elements coming to their knowledge which points to a risk of malicious
covert foreign interference”.
43
6.2.3. Fundamental rights impacts
6.2.3.1. Right to private life and to the protection of personal data180
All 3 policy options impose limited restrictions on the right to private life (Article 7 of the
Charter of Fundamental Rights, hereinafter ‘the Charter’181
) and the right to the protection of
personal data (Article 8 of the Charter), insofar as they require that entities keep and provide
certain information to the national authorities and provide access for the public to a part of that
information which might include personal data. The legislative policy options (PO2.1and
PO2.2) provide in addition for the exchange of such information among competent national
authorities.
As voters, citizens are important decision-makers in their own right, and as such, they can be
the target for certain interest representation activities. All 3 policy options enhance the integrity
of, and public trust in, the EU’s and Member States’ democratic institutions by ensuring the
transparency of interest representation activities carried out on behalf of third countries, and by
improving the knowledge about the magnitude, trends and actors of interest representation
activities carried out on behalf of third countries (see sections 6.2.2.1 and 6.2.2.2)182
. The CJEU
has recognised that the objective consisting in increasing transparency is an overriding reason
in the public interest183
. The aim pursued by the 3 policy options therefore constitutes an
objective of general interest that is capable of justifying interferences with the
fundamental rights enshrined in Articles 7 and 8 of the Charter in line with Article 52
thereof.
All 3 policy options provide for public access to a proportionate, clearly defined and limited
set of information, which excludes information that is not absolutely needed to reach the
purposes pursued. The limitations on the right to private life and the right to the protection of
personal data respect the essence of those rights, genuinely meet a general interest
recognised by the EU, and are proportionate and limited to the minimum necessary.
In particular, in the legislative policy options (PO2.1 and PO2.2), the set of data to be made
available to the public is limited to what is necessary to improve knowledge about the
magnitude, trends, and actors of interest representation carried out on behalf of third
countries184
. It is clearly and exhaustively defined and fully harmonised throughout the EU.
Most of the information contained in the register would not consist of personal data. The data
minimisation principle contained in the GDPR would be uphold in this context by limiting
personal data made publicly available to the minimum required for citizens to be informed
about the entity carrying out interest representation and the activity carried out on behalf of
third country entities. Information of relevance only to the competent national authorities,
supervising and monitoring compliance with those options, would not be made publicly
available, to safeguard against the risks of abuse of the information provided.
In addition, the legislative policy options (PO2.1 and PO2.2), beyond fully harmonising the set
of data to be made public, provide for additional and specific safeguards by enabling entities
to request that all or part of the information gathered for the purpose of the transparency
requirement is not made public based on an overriding interest. The requirement in PO2.2 that
180
For a full analysis, see Annex 8.
181 Charter of Fundamental Rights of the European Union, OJ C 326, 26.10.2012, p. 391–407 (BG, ES, CS, DA, DE, ET, EL,
EN, FR, IT, LV, LT, HU, MT, NL, PL, PT, RO, SK, SL, FI, SV).
182
As stated by the Venice Commission, “lobbying activities fall (…) in between the political party activities and ordinary
NGO activities. (…) The public has a clear interest in knowing the lobbying actors who have access to government
decision-making process for the purpose of influence, including their financial sources whether domestic or foreign”.
Venice Commission Report on Funding of Associations CDL-AD(2019)002, paragraph 105.
183
See note 125, paragraph 79.
184
See section 5.3.2.1 for details on the information to be made public.
44
entities falling within the scope of the risk-based approach are required to automatically share
all of their records with the supervisory authorities could go beyond what is necessary to ensure
the transparency of interest representation activities carried out on behalf of third countries.
6.2.3.2. Freedom of association185
The right to freedom of association is guaranteed under Article 12 of the Charter, it applies
to associations, including CSOs, interest groups, trade unions and political parties.
Careful consideration is being given to the potential spill over effect of the measures and
unintended negative consequences for the operation of CSOs, which are operating in a
shrinking civic space186
.
Stakeholder views:
7 out of 11 CSOs voiced concerns about the risk of “creating a negative presumption and stigmatising
CSOs who received foreign funding” and about the risk that they might be “misused by Member
States in expansive transposition”. 4 CSOs argued that the proposed measures do not “remove
potential obstacles to the functioning of the internal market, [but] that they introduce additional
obstacles […] by limiting the ability of organisations to seek and receive funds.”
Freedom of association constitutes one of the essential pillars of a democratic and pluralistic
society, in as much as it allows citizens to act collectively in fields of mutual interest and to
contribute to the proper functioning of public life187
. Associations must be able to pursue their
activities, operate without unjustified interference, and obtain resources to support their
operations. The Court considers that legislation which renders significantly more difficult the
action or operations of associations, whether by strengthening the requirements in relation to
their registration, by limiting their capacity to receive financial resources, by imposing
obligations of declaration and publications such as to create a negative image of them or by
exposing them to the threat of penalties, in particular of dissolution, is to be classified as a
limitation to the freedom of association188
.
The examined policy options are limited to ensuring transparency regarding interest
representation activities carried out on behalf of third country entities and seeking to influence
decision-making processes in the EU. They do not affect as such the possibility for entities to
carry out these activities (with the exception of PO2.2). However, transparency requirements
could have a spill over effect on other activities of CSOs for instance their advocacy work.
All 3 policy options enhance the integrity of, and public trust in, the EU’s and Member States’
democratic institutions by ensuring the transparency of interest representation activities carried
out on behalf of third countries, and by improving the knowledge about the magnitude, trends
and actors of interest representation activities carried out on behalf of third countries (see
sections 6.2.2.1 and 6.2.2.2)189
. The CJEU has recognised that the objective consisting in
increasing transparency is an overriding reason in the public interest190
. As such, it is possible
to justify the limited and proportionate impact on freedom of association resulting from the
initiative – in as much as the requested organisations would have to comply with the
registration and reporting obligations and pay the related costs.
185
For a full analysis, see Annex 8.
186
The 2022 FRA’s report highlights that in 2020, 15% CSOs faced legislations on transparency and lobby laws negatively
affecting their freedom, available at: https://fra.europa.eu/en/publication/2022/fundamental-rights-report-2022-fra-
opinions.
187
See note 125, paragraph 112.
188
See note 125, paragraph 114; Judgment of the ECtHR of 14 June 2022, Ecodefense v. Russia, n°9988/13, paragraph 81.
189
See note 182.
190
See note 125, paragraph 79.
45
The limited transparency obligations would, furthermore, not affect the essence of the right to
freedom of association. In particular, while imposing transparency obligations, the proposed
measures do not restrict the right to seek for funding and resources as none of the policy options
ban foreign funding.
All 3 policy options thus meet the objective of general interest, in light of the principles of
openness and transparency, which must guide the democratic life of the EU in accordance with
the second paragraph of Article 1 and Article 10(3) TEU and in conformity with the democratic
values shared by the EU and its Member States pursuant to Article 2 TEU.
With regard to the proportionality of the limitation, all 3 options apply indiscriminately to
any entity receiving financial support from abroad by reason of the type of activity they
carry out. In particular, the legislative policy options (PO2.1 and PO2.2) would not cover any
funding given by a third country entity191
, but only the funding which is related to an interest
representation activity (structural grants, donations, etc. are therefore excluded). These
legislative options only focus on the activities that are genuinely likely to have a significant
influence on public life and public debate. Secondly, none of the policy options target
specifically CSOs or other associations, significantly reducing the risk of stigmatisation.
They regulate a specific type of activity – interest representation activities carried out on behalf
of third country governments – regardless of the natural or legal person carrying it out.
The legislative policy options (PO2.1 and PO2.2) contain specific safeguards to avoid
stigmatisation. Firstly, the national public registers would have to be presented in a neutral
manner and in such a way that it does not lead to stigmatisation of the entities included in the
register (e.g. Member States would be prevented from requiring the entities that fall within the
scope of the initiative to register ‘as an organisation in receipt of support from abroad’ or
indicate on their internet site and in their publications and other press material the information
that they are organisations in receipt of support from abroad). In particular, the publication
should not be presented with or be accompanied by statements or provisions that could create
a climate of distrust with regard to the registered entities, apt to deter natural or legal persons
from Member States or third countries from engaging with them or providing them with
financial support.
Secondly, Member States should ensure that when carrying out their tasks, the national
authorities ensure that no adverse consequences arise from the mere fact that an entity is
registered.
Thirdly, the registered entities would be able to request that all or part of the information is not
made publicly available where there are overriding legitimate interests preventing publication.
By imposing a full harmonisation of the transparency requirements, these 2 options ensure
that registered entities may not be required to present themselves to the general public in a
manner liable to stigmatise them192
.
Additionally, the full harmonisation responds to the concerns of CSOs that the legislative
instrument could be “misused by Member States in expansive transposition”. This would not
be possible as Member States would be prohibited from exceeding the limits imposed by the
legislation and could not lay down more stringent protective measures on the grounds of
transparency.
Furthermore, the reporting obligations would be fully harmonised. The reports available to the
public would present the amounts in an aggregated data and per type of entity registered (i.e.,
191
Third country governments and entities whose action can be attributed to them, see section 5.2.
192
Upon registration, these entities would only be required to provide their registration number in their contacts with public
officials, not the wider public.
46
no amounts spent by specific entities would be provided). When it comes to the information
available in the registers, the ranges in which the amounts should be public would be fully
harmonised.
The legislative policy options (PO2.1 and PO2.2) also include proportionate sanctions and a
comprehensive system of safeguards, including effective judicial review193
. These options
would ensure that CSOs and other associations would not be exposed to the threat of criminal
penalties or dissolution.
Stakeholder views:
1 (out of 11) CSOs highlights that “registration procedures must be manageable by volunteers and
amateurs, since unlike business corporations, CSOs are often staffed by volunteers.”
The targeted requirements included in PO2.1 are proportionate and will not overburden
concerned entities, also not those run by smaller teams or by volunteers. (i) In terms of record-
keeping, the concerned entities would be required to keep, for a limited period, a clearly defined
set of information194
. (ii) In terms of registration, the concerned entities would only be required
to provide limited information on themselves, the activities conducted, and the third country
entities they conduct the activities for. The registration would include an approximation195
of
the remuneration received. Only the information necessary for the application and oversight of
the legislative initiative would need to be updated regularly. Other information would only
need to be updated annually. (iii) Apart from where it is necessary to examine non-compliance
with the registration requirements, registered entities can only be requested to share their
records with the supervisory authority as part of a risk-based approach where, based on
objective factors, they are particularly likely to have a significant influence on public life and
public debate. (iv) As illustrated in section 6.2.1.3 and Annexes 3 and 4, the costs for private
entities are not likely to render significantly more difficult the action or operations of
associations and are limited to what is necessary to ensure transparency.
The extended requirements included in PO2.2 impose additional burdens on the concerned
entities as compared to the targeted requirements included in PO2.1196
. These additional
provisions enhance the restrictions on the right to freedom of association. Member States
would be able to refuse granting a licence on the ground that the activity is likely to seriously
affect public security. While such measure would be suitable to address threats to internal and
external security, it would still place de facto prior authorisation obligations on the mechanisms
by which associations use certain remunerations from third countries. Such measures could
193
Supervision would be entrusted to independent supervisory authorities with clearly established powers, whose requests for
further information would need to be motivated and subject to effective judicial remedy. Sanctions would be designed in
a way that would avoid a chilling effect on the concerned entities and sanction related powers subject to appropriate
safeguards, including the right to effective judicial review. They would be fully harmonised and limited to administrative
fines under a specific ceiling based on the entity’s economic capacity. Sanctions would only be imposed following a prior
early warning except for breaches of the anti-circumvention clause.
194
These records would include information on the identity of the third country entity on whose behalf the activity is carried
out, a description of the purpose of the interest representation activity, contracts and key exchanges with the third country
entity to the extent that they are essential to understand the nature and purpose of the interest representation carried out as
well as information or material constituting key components of the interest representation activity.
195
During the registration the precise amount would not be requested. Concerned entities would have to indicate in which
bracket (e.g.: EUR 25,000 < 50,000; or EUR 50,000 < 100,000) the remuneration would fall, this remuneration would
cover all the tasks carried out with the objective of influencing the development, formulation or implementation of the
same proposal. Information on the annual amounts declared would be made public within wider brackets corresponding
the level of detail necessary for the purpose of informing citizens their representatives and other interested parties.
196
These additional requirements include: (i) a requirement to apply to national-level authorities for an EU-wide licence to
conduct interest representation activities on behalf of a third country entity; and (ii) a requirement to keep records of all
contracts and exchanges with the entity on whose behalf the activity is carried out as well as all information or material on
the interest representation activity.
47
have a disproportionate impact in the light of the objective that it seeks to achieve197
.
Furthermore, this system of prior authorisation would give Member States a certain leeway
which could create a risk of arbitrariness in the decisions to grant said licence. Finally, the fact
that a publicly available flag would be added in the registration of the entity who received a
licence despite comments submitted by a Member State or the Commission, could lead to
stigmatisation of the said entity.
The non-legislative option (PO1) would not provide for the extended requirements of the
PO2.2. However, it would only provide for recommendations, leaving Member States a large
room of manoeuvre to implement transparency requirements and would not ensure the
implementation of the safeguards provided by the legislative options. In the questionnaire that
was sent to Member States, CSOs, and industry representatives, 6 out of 11 CSOs have
expressed concerns that such recommendations could be misused.
6.2.3.3. Freedom of the arts and sciences
The freedom of the arts and sciences is guaranteed under Article 13 of the Charter. Among
other198
, Article 13 of the Charter protects the freedom of researchers to express their opinion
without being disadvantaged by the institution or system in which they work or by
governmental or institutional censorship.
In the recent decades, research, innovation and higher education have increasingly expanded
beyond national borders to become fully internationalised. While generally a welcome
development, this also creates challenges as some third countries may seek to influence
scientific research or shape educational activities to further their own goals and influence
decision-making in the EU.199
By ensuring the transparency of interest representation activities
carried out on behalf of third countries via education, research and academic institutions, all 3
policy options would shed light on potential cases of foreign interference in this field.
Stakeholder views:
1 member of Academia indicated in a follow-up paper after a focus group meeting200
that “to limit
global dialogue, there must be a concrete and identifiable risk; blanket bans will undermine the long-
term benefits of openness to the world. Here, the people-to-people aspect of academic exchanges
remains an essential instrument for mutual understanding. This must not be hampered by general bans
197
“As to the necessity and proportionality of measures taken to secure the above-mentioned aims, interference with the right
of associations to seek and obtain financial and material resources should be the least intrusive of all possible means that
could have been adopted. The authorities should be able to prove that the legitimate aim pursued by the measure cannot
be reached by any less intrusive measures. In particular, an outright ban on foreign funding, or requiring prior
authorisation from the authorities to receive or use such funds, is not justified.” Venice Commission Report on Funding
of Associations, CDL-AD(2019)002, paragraph 147; see also Report by the UN Special Rapporteur on the rights to
freedom of peaceful assembly and of association (A/HRC/50/23) paragraphs 20 to 22.
198
The freedom of the arts and sciences ensures the freedom of academic staff and students to engage in research, teaching,
learning and communication in and with society without interference nor fear of reprisal. Freedom of scientific research
encompasses the right to freely define research questions, choose and develop theories, gather empirical material and
employ academic research methods, to question accepted wisdom and bring forward new ideas. It entails the right to share,
disseminate and publish the results thereof, including through training and teaching. It is also the freedom to associate in
professional or representative academic bodies. In addition, within the European Higher Education Area, Ministers stated
that they commit to upholding institutional autonomy, academic freedom and integrity, participation of students and staff,
and public responsibility for and of higher education. They adopted the definition of academic freedom as freedom of
academic staff and students to engage in research, teaching, learning and communication in and with society without
interference nor fear of reprisal (Rome Communiqué 2020 adopted on 19 November 2020 at the Ministerial conference of
the European Higher Education Area (EHEA)).
199
‘Commission publishes a toolkit to help mitigate foreign interference in research and innovation’, Directorate-General for
Research and Innovation, European Commission, 18 January 2022, available at: https://research-and-
innovation.ec.europa.eu/news/all-research-and-innovation-news/commission-publishes-toolkit-help-mitigate-foreign-
interference-research-and-innovation-2022-01-18_en.
200
Focus group meeting of 17 November 2022 with 7 representatives from Academia and research organisations.
48
and obstacles unless there is a clear risk for foreign interference against the interest and values of
Europe’s democracies”.
None of the policy options regulate the freedom to define research questions, nor the right to
disseminate and publish the results. None of the policy options would include a general ban on
international collaboration (only the extended requirements included in the PO2.2 would limit
an interest representation on an individual basis, in the specific situation where the activity is
likely to seriously affect public security). The policy options would only introduce common
transparency standards in the internal market for interest representation activities carried out
on behalf of third countries. They would not affect the institutional autonomy of EU Higher
Education Institutions to set their own organisations, recruit independently, set the structure of
content or degrees or to borrow money or set tuition fees.
With regard to the risks of stigmatisation or obstacles to academic freedom, the analysis
provided with regard to the freedom of association is applicable mutatis mutandis (see section
6.2.3.2).
6.2.3.4. Freedom of expression and information
With regard to the freedom of expression and information (Article 11 of the Charter), both policy
options would positively contribute to the right of individuals to receive and impart information
and ideas without interference by public authority.
Citizens would gain better access to information on interest representation activities carried out
on behalf of third countries affecting public decision-making. This would strengthen their
understanding of such activities, reinforce their confidence in the integrity of public decision-
making processes and deter manipulative foreign interference. At the same time, safeguards
ensure that the right to the protection of personal data of natural persons providing information
to national registries is guaranteed. In addition, in specific situations where organisations
registered justify an overriding interest, the publication of information may exceptionally be
withheld.
In this regard, the legislative measures in the proposal would improve the transparency and
accountability of entities that carry out interest representation activities on behalf of third
countries and enhance the knowledge about the magnitude, trends and actors of such activities.
The fundamental right to receive information would be reinforced as citizens would gain useful
information to exercise their democratic rights and hold their public officials accountable.
None of the policy options regulate the content of the interest representation activities.
None of the policy options require transparency in terms of funding of operating expenditure,
which are unrelated to an interest representation activity like structural grants or donations.
This implies that the freedom of CSOs and other concerned entities, to express an opinion on
their own behalf, would a priori not be affected by the different policy options.
The provision of transparency measures could have a chilling effect on the decision to carry
out interest representation activities and could restrict the freedom of expression of entities
whose action can be attributed to a third country government (such as a private entity controlled
by a third country)201
. These measures pursue an objective in the general interest capable of
justifying interference with this freedom (see section 6.2.3.2). Furthermore, the specific
201
This restriction would also exist to PO1 to the extent that the Recommendation is implemented in a way that applies to
entities beyond third country governments (such as third country entities as defined in section 5.2.).
49
requirements imposed by PO1 and the targeted requirements in PO2.1 are not more far-
reaching than would be required to achieve this objective (see section 6.2.3.2).
The system of prior authorisation in the extended requirements included in the PO2.2 imposes
additional restrictions on the freedom of expression of entities whose actions can be attributed
to a third country government. Member States would be able to refuse granting a licence on
the ground that the activity is likely to seriously affect public security. Such measure could
have a disproportionate impact at the light of the objective that it seeks to achieve (see section
6.2.3.2).
6.2.3.5. Freedom to conduct a business
Article 16 of the Charter recognises the freedom to conduct a business in accordance with EU
law and national laws and practices. The harmonised requirements would facilitate and reduce
the obstacles for the cross-border provision of services by entities carrying out interest
representation activities on behalf of third countries, which would support such entities in the
exercise of their freedom to conduct a business.
The freedom to conduct a business differs from the wording of the other fundamental freedoms
laid down in Title II of the Charter, such as the freedom of association, the freedom of
expression and information and the freedom of the arts and sciences (see sections 6.2.3.2,
6.2.3.3 and 6.2.3.4), and may be subject to a broad range of interventions on the part of public
authorities which may limit the exercise of economic activity in the public interest202
.
All 3 options impose limited restrictions on economic activities, insofar as they impose on the
entities the obligation to comply with certain requirements when carrying out interest
representation on behalf of third countries.
The transparency measures for interest representation activities carried out on behalf of third
countries are measures which pursue an objective in the general interest capable of justifying
interference with this freedom. Furthermore, the specific requirements imposed by PO1 and
the targeted requirements in PO2.1 are not more far-reaching than would be required to achieve
this objective.
The system of prior authorisation in the extended requirements included in PO2.2 imposes
additional restrictions on economic activities. Member States would be able to refuse granting
a licence on the ground that the activity is likely to seriously affect public security. Such
measure would seek to address threats to internal and external security which pursue an
objective in the general interest capable of justifying interference with this freedom. Such
measure would apply in limited individual cases and would need to be justified and would not
impede concerned entities to carry out other interest representation activities for which a
licence has been granted. This additional requirement would thus not be more far-reaching than
would be required to achieve this objective.
6.2.4. Geopolitical implications
The Union is committed to supporting democracy and human rights in its external relations, in
accordance with its founding principles of freedom, respect to human dignity, democracy and
respect for human rights, fundamental freedoms and the rule of law203
. The Union has a large
202
Judgment of the Court of Justice of 22 January 2013, Sky Österreich GmbH v Österreichischer Rundfunk, C-283/11,
ECLI:EU:C:2013:28, paragraph 46.
203
Article 2, 3(5) and 21(1) TEU.
50
set of tools to support and protect democracy and human rights worldwide204
. With its Member
States, it is the world’s largest provider of democracy support and human rights assistance,
financing programmes with both state and non-state actors in the vast majority of third
countries. All operations are guided by the Human Rights Based Approach, encompassing
principles of respect for human rights, participation, inclusion, transparency and accountability.
The Union consistently condemns any undue limitation on fundamental freedoms and
restrictions on civic and political space in violation of international human rights law, including
so-called “foreign agent laws”205
. These laws often include measures that unduly limit the civic
space and restrict human rights that are key pillars of a democratic society. For example, the
Russian Regulation of the Activities of Non-profit Organisations Performing the Functions of
a Foreign Agent, adopted in 2012 and amended in 2022 has been used to “stigmatise […] and
seriously hamper”206
the activities of individuals from different groups of society, including
CSOs, unregistered public associations, media outlets, journalists, activists and human rights
defenders. Other attempts to enact laws aiming to scrutinize the work of CSOs receiving
support from abroad include the Georgian draft law on transparency of foreign influence and
the Republika Srpska’s draft law on the Special Register and Transparency of the Work of the
non-profit organisations207
.
In contrast to so-called ‘foreign agent laws’, which take a restrictive starting point, none of the
policy options seek to regulate CSOs in particular nor negatively label their activities, nor
restrict fundamental freedoms and civic space. Instead, the policy options are designed to
provide transparency requirements and more democratic accountability to citizens on interest
representation activities carried out on behalf of third country entities. None of the policy
options ban foreign funding or require transparency in terms of funding of operating
expenditure of CSOs (such as structural grants or donations)208
.
204
See for example the EU Action Plan on Human Rights and Democracy 2020-2024. The EU regularly discusses issues
related to the respect for democracy and human rights in political dialogues as well as in dedicated human rights dialogues
with third countries and regional or multilateral organisations. In addition to the dialogues, bilateral trade agreements and
the various association and cooperation agreements between the EU and third countries or regional organisations include
human rights clause defining respect for human rights as an ‘essential element’ of the said agreements. There are also
specific mechanisms that have been established for enlargement countries that adheres to EU’s commitment to democracy
and human rights. Before joining the EU, these countries have to develop stable institutions guaranteeing democracy, the
rule of law, human rights and respect for and the protection of minorities, a process actively supported by the EU.
205
See inter alia: ‘Russia: Declaration by the High Representative on behalf of the EU on the 10th
anniversary of the
introduction of the Law on Foreign Agents’, Council of the European Union, 20 July 2022, available at:
https://www.consilium.europa.eu/en/press/press-releases/2022/07/20/russia-declaration-by-the-high-representative-on-
behalf-of-the-eu-on-the-10th-anniversary-of-the-introduction-of-the-law-on-foreign-agents/; ‘Georgia: Statement by the
High Representative on the adoption of the Georgian “foreign influence” law’, European Union External Action, 7 March
2023, available at: https://www.eeas.europa.eu/eeas/georgia-statement-high-representative-adoption-
%E2%80%9Cforeign-influence%E2%80%9D-law_en; ‘EU in BiH on recent developments in the RS’, Delegation of the
European Union to Bosnia and Herzegovina & European Union Special Representative in Bosnia and Herzegovina, 27
March 2023, available at: https://www.eeas.europa.eu/delegations/bosnia-and-herzegovina/eu-bih-recent-developments-
rs_en?s=219.
206
Venice Commission, Opinion on Federal Law N. 121-FZ on Non-Commercial Organisations (“Law on Foreign Agents”),
CDL-AD(2014)025, paragraph 132.
207
According to Republika Srpska’s draft law, foundations as well as foreign and international non-governmental
organisations receiving any form of foreign funding or other assistance of foreign origin would be designated as “Non-
profit organisations” (hereinafter “NPOs”). This draft law would prohibit NPOs from carrying out political activities,
requiring them to register in a special registry and all their published materials to include the mark “NPO”, and to submit
additional reports compared to those already required by the existing legal framework. NPOs would also be subject to an
additional legal regime of oversight and inspections, and a range of sanctions for violations of the provisions of the draft
law that may result in the ban of the NPOs’ activities and thereby of the NPO itself. The joint opinion of the Venice
Commission and OSCE/ODIHR on Republika Srpska’s draft law indicates several areas of concern due to non-compliance
with international human rights standards, available at:
https://www.venice.coe.int/webforms/documents/default.aspx?pdffile=CDL-AD(2023)016-e. For instance, the Draft Law
is not based on any risk assessment or consultation with associations and others potentially affected.
208
For more details see Section 6.2.3.2 and Annex 8.
51
Risk of retaliatory measures by third countries
Stakeholder views:
8 out of 11 CSOs and 5 out of 15 Member States considered there are associated geopolitical risks. 1
CSO explained that the legislative policy options “bring a risk of reciprocity, in which organisations in
third countries receiving EU funds would be specifically targeted by third country governments”.
Following the targeted questionnaire, a few Member States expressed views that measures
addressing interest representation could have an impact on diplomatic relations with third
countries unless exceptions are provided for diplomatic work and international organisations.
A number of foreign influence laws have been introduced worldwide. There does not seem to
be a clear causal relationship or direct temporal link between the introduction of, on the one
hand, foreign influence laws, such as the US Foreign Agents Registration Act (‘FARA’, in
force since 1938) or the Australian Foreign Influence Transparency Scheme Act (‘FITSA’, in
force since 2018), and, on the other hand any of the foreign agent laws as they exist in Russia
(in force since 2012), Nicaragua (in force since 2020), El Salvador (proposed in 2021), Georgia
(proposed in 2023), or Bosnia and Herzegovina’s Republika Srpska (adopted in 2023). The
increasing number of proposed and/or adopted foreign agent laws in recent times shows that
these laws come into force independently of EU action, and rather illustrates the broader trend
of direct and indirect restrictions on civic and political space.
However, given the prominent role and stance of the Union regarding the defence and
promotion of democracy and human rights, EU legislative initiatives, due to their visibility,
present a significant risk of manipulation and misuse. This can happen in two ways. First,
regardless of factual differences, third country governments might attempt to justify their
foreign agent laws with reference to the EU’s legislation. This has been the case for the US
FARA since both the governments of Russia and Georgia have explicitly referred to the act
when introducing their legislation.209
Second, accusations of hypocrisy or ‘double standards’
could be expected, especially from those actors who will try to spin it for their own justification
but also more widely if the differences between legislations are not clearly communicated and
understood, regardless of factual differences. The geopolitical impacts of the policy options
will vary from third country to third country and may be difficult to assess in advance.
For all 3 policy options, such consequences could be mitigated by diplomatic exchanges and
information activities that will be conducted to present and explain in details the targeted aims
and the proportionality of the measures as well as the strong safeguards. This will imply to
explain in details the important and manifest differences between the selected policy option
and the so-called “foreign agents laws”210
, managing false narratives and potential unfounded
assimilations through adapted explanations of the content of the EU initiative.
Clarity on the differences will be crucial. These include: the focus of the EU proposal on
interest representation activities impacting decision-making processes in the European Union
rather than individual organisations, the exclusion of operating grants for CSOs or private
donors from the scope, the absence of any regulations that might be used to hinder the work of
209
The International Center for Not-for-Profit Law (2017), ‘FARA’s Double Life Abroad’, Washington D.C., available at:
https://www.icnl.org/wp-content/uploads/FARA-briefing_Final_c.pdf, page 1; Judgment of the European Court of Human
Rights of 14 June 2022, Ecodefence and others vs. Russia, ECLI:CE:ECHR:2022:0614JUD000998813, paragraph 41, 44;
.‘Shalva Papuashvili to Dunja Mijatovic concerning the so-called draft laws on agents’, Parliament of Georgia, 03 March
2023, available at: https://parliament.ge/en/media/news/shalva-papuashvili-dunia-miatovichs-minda-dagartsmunot-
saparlamento-diskusiebi-ikneba-inkluziuri-rom-moidzebnos-sauketeso-versia-romelits-gaitvalistsinebs-rogorts-
sakartvelos.
210
Most recently the new foreign agent law in BiH’s Republika Srpska, see ‘Bosnia and Herzegovina: Statement by the
Spokesperson on the “foreign agent” law in Republika Srpska’, European Union External Action, 28 September 2023,
available at: https://www.eeas.europa.eu/eeas/bosnia-and-herzegovina-statement-spokesperson-%E2%80%9Cforeign-
agent%E2%80%9D-law-republika-srpska_en.
52
CSOs and the absence of criminal sanctions and other restrictive measures. Furthermore, the
proposed measures include important safeguards like the possibility of judicial redress as well
as the possibility to request that some of the information gathered will not be made public based
on an overriding interest which differentiate them from other measures.
The proposed measures also do not cover any activities related to the exercise of diplomatic
relations between states or international relations.
Additionally, all 3 policy options take into account the feedback related to US FARA and the
Australian FITSA. These two legislations are fundamentally different from foreign agent laws
in place or proposed in other third countries. Some CSOs and academics consider that the US
FARA is too broad and vague in its definitions and scope, and expressed concerns regarding
criminal sanctions.211
Taking into account this feedback, all policy options define interest representation on behalf of
third countries in very clear terms and none of the proposed measures uses wordings such as
“foreign agent”212
or “foreign principal”213
.
Providing for criminal penalties would be disproportionate, creating an atmosphere of distress
for concerned entities. PO2.1 and PO2.2 envisage exclusively administrative fines for non-
compliance with the proposed measures.
All policy options would provide for coherent transparency measures for all third countries. As
raised by 3 Member States (out of 15) in the targeted consultation, a targeted approach towards
only some third countries would be more likely to lead to retaliatory measures or create
diplomatic tensions214
. The risk-based approach as proposed in the legislative policy options
(PO2.1 and PO2.2) is based on an objective set of indicators and would not be arbitrarily
singling out one or several countries. The risk of retaliatory measures would thus be limited.
Due to the non-binding nature of the policy recommendations set out in PO1, their geopolitical
impacts would depend on their implementation by Member States. Such a recommendation
could potentially have a beneficial geopolitical impact as it would clarify the EU standard in
this area, and it would prevent it from being used as a carte blanche by certain third countries
to introduce legislation not in line with international human rights law and standards. In
comparison, the current fragmented approach by Member States is more likely to be damaging
to the EU’s reputation as it lacks consistency and coherence.
The geopolitical impact of the targeted requirements in PO2.1 is likely to be more important
compared to PO1, as a coordinated legislative proposal would have greater geopolitical
visibility. Compared to the non-legislative option, this PO further limits the risk of gold-plating
by introducing fully harmonised measures and allows the Commission to monitor its
implementation in Member States and react to any breaches, including of fundamental rights.
Furthermore, an EU coherent and proportionate approach focusing on transparency and
democratic accountability to address the challenges posed by interest representation on behalf
of third country entities, could serve to set standards.
The geopolitical impact of the extended requirements of PO2.2 is likely to be more negative
than that of PO2.1 since it includes the requirement for organisations to obtain a license before
211
The International Center for Not-for-Profit Law (2022), Recommendations to the Justice Department on FARA
Concerning Its Impact on Civil Society, Washington D.C., available at: https://www.icnl.org/post/analysis/u-s-program-
comments-faras-impact-on-civil-society.
212
‘Foreign Agents Registration Act’, U.S. Department of Justice, available at: https://www.justice.gov/nsd-fara.
213
'Foreign Influence Transparency Scheme’, Australian Government, available at: https://www.ag.gov.au/integrity/foreign-
influence-transparency-scheme.
214
See Section 5.2.1.
53
they are allowed to engage in any interest representation activities. There is a possibility for
pushback from third countries currently engaging in influence activities in the Union if their
activities would not be approved. Similarly, to the extent this option may include
disproportionate restrictions to the right to freedom of association, the EU’s reputation could
also be negatively impacted, and the EU might be perceived as setting a precedent for far-
reaching legislation on covert foreign influence.
Risk to entities covered by the policy options
Concerning the work of covered entities in third countries, there is a risk that certain third
countries might use EU legislation as a pretext to apply foreign agent legislation against
them,215
or otherwise restrict their activities.
Stakeholder views:
1 CSO (out of 11) explained that it receives funding from non-EU governments and related public
institutions in third countries and that part of this funding is used to support work in high-risk countries.
It explained that “publicly accessible information about our funding sources is therefore currently very
limited because it puts people and organisations [they] work with at physical and legal risks, it can
also jeopardise our ability to work in those countries by alerting local authorities”.
To address this point, the legislative policy options (PO2.1 and PO2.2) provide for additional
and specific safeguards by enabling entities to request that all or part of the information
gathered for the purpose of the transparency requirement is not made public based on an
overriding interest. Due to its non-binding nature, PO1 would not ensure the implementation
of the safeguards provided by the legislative options.
Even if consultations with stakeholders did not suggest that similar legislation like the US
FARA or the Australian FITSA have led to a relevant decrease of foreign donations for
American or Australian CSOs, 6 CSOs (out of 11) voiced concerns that the proposed measures
may impact funding from international donors. The impacts of the policy options on the
freedom of association are analysed in section 6.2.3.2.
Lastly, because the policy options cover any entity (established within or outside the EU) that
carries out interest representation activity on behalf of third counties to influence decision-
making processes in the EU, none of them will impact the competitive position of EU firms
with regard to non-EU competitors.
6.2.5. Digital by default principle
Under PO1, Member States would be invited to use digital tools. To the extent that these
recommendations are followed, PO1 would be in line with the Digital by default principle.
Under the legislative policy options (PO2.1 and PO2.2), the transparency registers would have
to be supported by publicly accessible IT tools in line with the 2030 Digital Compass
Communication216
and the need to promote “digital by default” policy-making in EU
legislation217
. Exchanges between authorities would also be supported by existing IT tools.
Table 5: Summary of the impacts for each of option considered (compared to the baseline)
Impact assessed Baseline Option 1 Option 2.1 Option 2.2
215
See for example the listing of the Voice of America and Radio Free Europe as ‘foreign agents’ by Russia after the United
States had asked RT TV America and Sputnik to register under FARA: Robinson, N., ‘‘Foreign Agents’ in an
interconnected world: FARA and the Weaponization of Transparency’, Duke Law Journal, Vol. 69, No 5, 2020, p. 1087.
216
Commission Communication, 2030 Digital Compass: the European way for the Digital Decade, (COM(2021) 118 final).
217
Berlin declaration on digital society and value-based digital government, signed at the ministerial meeting of 8 December
2020: Call on the Commission to ensure through the ‘better regulation’ framework that policies and legislative acts
proposed by the European Commission are digital-ready and interoperable by default.
54
Non
legislative
Legislative
targeted
requirements
Legislative
Extended
requirements
Economic impacts 0 + ++ +
Functioning of the internal market 0 + +++ ++
Competitiveness 0 + ++ ++
Costs and administrative burdens on
economic operators (+SMEs)
0
- + +
Costs for public authorities 0 - - - -
Social impacts 0 + ++ ++
Transparency of interest representation
activities carried out on behalf of third
countries
0
++ ++ ++
Improved knowledge about the
magnitude, trends and actors
0
+ ++ +++
Enforcement and supervision 0 + +++ +++
Fundamental rights impacts 0 - - - -
Right to private life and right to the
protection of personal data
0
- - - - -
Freedom of association 0 - - - - - -
Freedom of the arts and sciences 0 - - - - - -
Freedom of expression and
information
0
+ + -
Freedom to conduct a business 0 - - - -
Geopolitical implications 0 + - - -
Digital by default principle 0 0 + +
Overall 0 + ++ -
The table should be read in vertical: ‘+++’ means positive impact of very high magnitude compared to the
baseline, ‘++’ means positive impact of high magnitude compared to the baseline, ‘+’ means positive impact
of moderate magnitude compared to the baseline, ‘0’ means neutral impact compared to the baseline, ‘-’
means negative impact of moderate magnitude compared to the baseline, ‘- -’ means negative impact of
high magnitude compared to the baseline, ‘- - -’ means negative impact of very high magnitude compared
to the baseline, ‘n.a’ means not applicable.
7. HOW DO THE OPTIONS COMPARE?
The options were compared on the basis of the criteria of Effectiveness218
, Efficiency219
,
Coherence with existing and planned EU initiatives and Proportionality220
. Methodology is
explained in Annex 4.
7.1. Effectiveness
1. Facilitate cross-border interest representation activities carried out on behalf of third
countries when done transparently.
All 3 options would provide for similar transparency requirements in all Member States,
thereby levelling the playing field compliance cost and limiting the risks of regulatory
arbitrage. However, the non-binding nature of the proposed non-legislative measures, PO1
makes it difficult to determine if and how Member States would implement the proposed
transparency standards and further fragmentation will a priori not be preventable.
218
How the measures achieve the two objectives: Facilitate cross-border interest representation services carried out on behalf
of third countries done transparently; Improved knowledge about the magnitude, trends and actors of interest representation
activities carried out on behalf of third countries.
219
How the measure relates to the anticipated costs of the measures against the expected benefits of the increased
effectiveness.
220
How the measures relate effectiveness against efficiency and any negative impacts.
55
The legislative options (PO2.1 and PO2.2) would increase legal certainty and reduce the scope
for divergent legislation, they would also provide for the recognition, throughout the internal
market, of the registration in 1 Member State thereby facilitating cross-border interest
representation activities on behalf of third countries entities.
Divergence in implementation of the prior authorisation/licensing system in the PO2.2 could
reintroduce limited regulatory arbitrage.
2. Improve knowledge about the magnitude and trends of interest representation activities
carried out on behalf of third countries.
All 3 options would improve knowledge about the magnitude and trends of interest
representation activities carried out on behalf of third countries. The 2 legislative options
(PO2.1 and PO2.2), would be more effective, as by providing a fully harmonized set of data to
be collected and definition, they would greatly facilitate comparison between Member States
and the establishment of trends at EU level. Transparency of interest representation carried out
on behalf of third countries would be decisively enhanced as citizens could access a public
register on all interest representation activities carried out on behalf of third countries in the
EU. Researchers, CSOs and journalists could also use the information in order to better
understand how foreign influence unfolds, who is targeted, and what impacts it has on decision-
making processes. Given that this knowledge is communicated to a broader public and to
decision-makers, the harmonisation of transparency requirements would present an important
added value for democratic decision-making.
Furthermore, the flexible and evolutive approach to this data collection would enable to easily
adapt the data collection to the trends observed. Finally, the gradual and coordinated approach
to supervision, as well as the measures included to limit circumvention (see section 6.2.2.3)
would help ensure that the data collected is correct.
Due to its non-binding nature, PO1is unable to ensure a comparable collection of data and the
supervision of activities would remain inconsistent.
7.2. Efficiency
The efficiency of the options weighs the qualitative cost-benefit analysis described in Annexes
3 and 4, as well as in the description of the impacts in section 6 above.
In all 3 options, entities carrying out interest representation on behalf of third countries would
face some compliance costs to comply with the transparency requirements.
The non-legislative measures in PO1 and the targeted requirements in PO2.1 would impose
similar cost, however PO1 would not give the same benefits in terms of faciliating cross-border
interest representation activities on behalf of third countries, nor, for public authorities,
efficency gains in terms of cooperation between authorites with regard to enforcement and
supervision.
The extended requirements in PO2.2 would imply additional compliance costs for national
administration.
7.3. Coherence with other EU initiatives
Issues with coherence were not detected for any of the three policy options.
56
PO1 would build upon and be complementary to the recommendations issued by the
Commission in the context of the Rule of law reports221
, in terms of scope and content.
Additionally, this policy option would go beyond these recommendations as it provides for a
list of specific standards related to record-keeping, registration and transparency (1), a detailed
but voluntary reporting on the application of the specific standards (2) and a monitoring of the
implementation of the recommendation (3). It would also include references to safeguards that
Member States should establish, including to prevent stigmatisation of the registered entities.
As the scope of legislative measures in PO2.1 and PO2.2 are the same they will be assessed
together in relation to other EU initiatives.
The two legislative policy options will complement the proposal for a Regulation on the
transparency and targeting of political advertising222
. The proposal on political advertising
seeks to provide a high level of transparency for political advertising services in the Union
regardless of the medium used, and to provide additional safeguards applicable to the targeting
of political advertising based on the processing of personal data. This initiative has a different
scope from the proposal on political advertising: it covers interest representation activities
carried out on behalf of a third country entity. This includes interest representation activities
consisting of the organisation of communication or advertising campaigns, which could also
be considered as political advertising. However, interest representation mainly covers activities
which are not also ‘political advertising’ (e.g. lobbying individuals directly). Also, the political
advertising regulation covers activities within its scope regardless whether they are provided
on behalf of a third country entity.
Under the proposal on political advertising, transparency is ensured in particular by making
available to individuals certain information with each political advertisement. In addition,
political advertising publishers that are very large online platforms within the meaning of
Regulation (EU) 2022/2065 (‘the Digital Service Act’) would have to make the information
contained in the transparency notice available through the repositories of advertisements
published, pursuant to Article 39 of that Regulation. The current initiative complements this
by providing public access to complementary information in the national registers of the
Member States related to the providers of the interest representation activities, in particular a
clear indication as to the third country on behalf of which the interest representation activity is
carried out, the Member States where the interest representation will be carried out, and the
legislative proposals, policies or initiatives targeted by the interest representation activity.
These policy options would complement the Digital Services Act (DSA)223
, which requires
providers of online platforms to make available certain information about advertisements they
present on their online interfaces. In addition, the Digital Services Act requires providers of
very large online platforms or of very large online search engines that present advertisements
on their online interfaces to compile and make publicly available in a specific section of their
online interface, through a searchable and reliable tool, a repository containing information on
221
For instance, in the 2022 Rule of law report, Denmark, Slovakia was recommended to introduce rules on lobbying, and
Romania was invited to introduce rules on lobbying for Members of Parliament. Belgium was called to complete the
legislative reform on lobbying, establishing a framework including a transparency register and a legislative footprint,
covering both members of Parliament and Government. In the same report, Spain was recommended to continue efforts to
table legislation on lobbying, including the establishment of a mandatory public register of lobbyists. No more detailed
recommendations were issued.
222
Proposal for a Regulation on the transparency and targeting of political advertising, see note 21. This proposal seeks to
provide for a high level of transparency in the field of political advertising online and offline and to provide additional
safeguards applicable to targeting of political advertising based on the processing of personal data.
223
The Digital Services Act (see note 18) requires providers of online platforms to provide certain information about
advertisements they present on their online interfaces.
57
the advertisements. It also obliges such providers to assess and mitigate risks related to the
functioning, design or use of their service that have actual or foreseeable negative effects on a
series of societal risks including as regards civic discourse, electoral processes and public
security.
The policy options have a different scope to the Digital Services Act, as they cover interest
representation activities on behalf of third countries. Such activities can involve (e.g. as part of
the organisation of and advertising or communication campaign) placing advertisements on the
online interfaces of online platforms within the scope of the Digital Service Act. When this is
the case, the current initiative provides that these online platform services should be named by
the provider of interest representation activities in the registration of the entity, and the relevant
costs attributed to their services should be included in the amount of remuneration declared by
the entity carrying out the interest representation activity. However, this initiative does not
regulate responsibilities of online intermediaries and would not impose requirements directly
on the providers of online platform services themselves in that situation.
Similarly, the provision of media services as defined in Article 2 of the proposal for a
European Media Freedom Act (EMFA)224
and the provision of audiovisual media services
as defined in Article 1 of the Audiovisual Media Services Directive225
would not fall within
the scope of application of these policy options. However, interest representation activities
carried out on behalf of third country entities by media service providers would. Where media
service providers or video-sharing platform providers disseminate advertisements as a service
for entities carrying out interest representation activities on behalf of third countries, these
policy options would provide that such media service providers should be named in the
registration of the entity, and the relevant costs should be included in the amount of
remuneration declared. Just like for providers of online platforms, these policy options would
a priori not impose requirements on media service providers or video-sharing platform
providers.
In the rare cases where a media service provider itself carries out interest representation
activities on behalf of a third country entity, it would be subject to the requirements of the
policy options. The information to be provided would be complementary. While the EMFA
would provide information on the beneficial owner of a media service provider providing news
and current affairs, these two policy options would provide information on the entity on whose
behalf the interest representation is carried out.
The proposed Directive on combating corruption226
seeks to protect democracy as well as
society from the impact of corruption and proposes updating the Union criminal legal
framework to include beyond the offences of bribery and misappropriation, also trading in
influence, abuse of functions, obstruction of justice, and enrichment from corruption. When
the offender committed these offences for the benefit of a third country, the proposed Directive
wants Member States to consider this an aggravating circumstance. The policy options would
complement this proposal as the transparency of interest representation activities on behalf of
third country entities is likewise expected to make a positive contribution to the prevention and
detection of corruption.
224
European Media Freedom Act, see note 22.
225
Directive (EU) 2010/13 of the European Parliament and of the Council of 10 March 2010 on the coordination of certain
provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual
media services (Audiovisual Media Services Directive).
226
Proposal for a Directive on combating corruption, see note 25.
58
These policy options are coherent with the annual Rule of Law Reports227
of the Commission
which, since 2020, monitor, under their anti-corruption pillar, the regulation of interest
representation and lobbying in all Member States, within the framework of existing European
and international standards. It is recommended to Member States to have in place a footprint
of rules for lobbying, and to secure a thorough and consistent application of similar rules to
different types of lobbyists and lobbying activities228
.
These policy options are coherent with the proposal for a revision of the Regulation on the
funding of European political parties and European political foundations (EUPP/F)229
which are in ongoing negotiations. Depending on the outcome of the negotiations, the
Regulation could ban all contributions from third countries to European political parties except
limited contributions from certain third countries with a high level of transparency concerning
the financing of political parties230
.
These two policy options would slightly amend the Internal Market Information System
(‘IMI system’) Regulation231
to implement the administrative cooperation and the exchange
of information provided for by this initiative using existing IT tools. These policy options
would slightly amend the Single Digital Gateway Regulation232
to provide for easy online
access to information on the rights and obligations stemming from this option, as well as to
ensure that access to and completion of the procedure for registration required by this option is
fully online. The Whistle-blower Directive233 would also be slightly amended to ensure that
whistle-blowers are able to alert the supervisory authorities of actual or potential infringements
of the policy options’ requirements.
These policy options would not affect the prohibition to make available, directly or indirectly,
funds or economic resources to or for the benefit of natural or legal persons, entities or bodies,
or natural or legal persons, entities or bodies associated with them which are listed in EU
restrictive measures adopted pursuant to Article 29 TEU and Article 215 TFEU.
These policy options will have a link to the proposal for a Directive on cross-border activities
of associations (ECBAs)234
. While the ECBA proposal envisages measures to coordinate the
conditions for establishing and operating European cross-border associations (ECBAs) and
thereby simplifying the cross-border activities of associations, including soliciting and
receiving funding, the policy options create transparency standards for their interest
representation activities carried out on behalf of third countries. They do not cover funding
given by a third country entity (such as a structural grant, donations, etc.) that is unrelated to
an interest representation activity. In practice, ECBAs will have to comply with the targeted
227
‘Rule of law mechanism’, European Commission, available at: https://commission.europa.eu/strategy-and-
policy/policies/justice-and-fundamental-rights/upholding-rule-law/rule-law/rule-law-mechanism_en.
228
See Annex 9 for details.
229
See note 17.
230
These could include EFTA Member States, former EU Member States, candidate countries, countries entitled to use the
euro as official currency on the basis of a monetary agreement with the EU, partner countries having a stabilisation and
association agreement with the EU as well as European countries with whom the EU has concluded Association
Agreements comprising a Deep and Comprehensive Free Trade Area. During the focus group with representatives of
European political parties and foundations, participants underscored the high level of transparency which applies to
EUPP/F and raised the question of providing a level playing field in terms of transparency requirements between entities
influencing decision-making processes. (Focus group with European political parties and foundations of 21 March 2023).
231
See note 171.
232
See note 170.
233
Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons
who report breaches of Union law.
234
Proposal for a Directive of the European Parliament and of the Council on European cross-border associations
(COM/2023/516 final) which address the fragmentation of national rules for associations and non-profit organisations
across the EU and facilitate their activities across borders in the internal market.
59
transparency requirements under these two policy options only if they carry out interest
representation activities on behalf of third country entities.
These policy options would not affect the prerogatives of the Commission to initiate and
conduct investigations into distortive foreign subsidies under the Foreign Subsidies
Regulation235
or to issue opinions under the EU Regulation on Foreign Direct Investment
(FDI) Screening236
.
Finally, the policy options affect the target of reducing burdens associated with reporting
requirements, set in the Commission’s long-term competitiveness Communication237
.
Reducing administrative burdens is crucial to maintaining the competitiveness of European
businesses. In some cases, entities carrying out interest representation on behalf of third
countries could fall under the scope of the Directive on corporate sustainability reporting
(CSRD)238
. These cases would be limited and restricted to the situation were the actions of a
large company would be attributed to a third country239
. In that case, the large company will
have to register according to the requirement of the policy options and apply the CSRD
requirements. The CSRD, reporting obligations are to be done annually and include reporting
obligations on political influence and lobbying activities.
The transparency registered established under these two policy options would be separate
instruments than the EU transparency register240
.
This initiative would contribute to the available legal and policy instruments presented in the
Foreign Information Manipulation and Interference (FIMI) Toolbox, which frames and
inventories the EU’s comprehensive approach to tackle FIMI and disinformation. In instances
where interest representation activities can be linked to FIMI incidents, this will help efforts
initiated through the toolbox to develop a common analytical framework and methodology to
collect systematic evidence of FIMI incidents, improve the understanding of tactics, techniques
and procedures used to manipulate, and contribute to an interoperable methodology aimed at
supporting a whole-of-society approach to tackling FIMI. In this sense, it could also support
different measures of the Common Foreign and Security Policy where interest representation
activities can be linked to FIMI activities.
7.4. Proportionality
PO1 and the targeted requirements in PO2.1 are proportionate to the objectives set (see sections
6.2.1, 6.2.3 and 6.2.4). PO2.1 proposes safeguards that prevent in particular the stigmatisation
of legitimate interest representation. They notably include equal transparency requirements for
all entities, the obligation for Member States’ authorities to ensure that no adverse
consequences arise from the mere fact of registration, the non-publishment of data based on an
235
Regulation on foreign subsidies distorting the internal market (see note 3) aims to establish a harmonised framework to
address distortions of competition on the internal market caused, directly or indirectly, by foreign subsidies.
236
The FDI Screening Regulation (see note 23) provides an EU framework for the screening of direct investments from third
countries on the grounds of security or public order.
237
See Communication from the Commission to the European Parliament, the Council, the European Economic and Social
Committee and the Committee of the Regions on the Long-term competitiveness of the EU: looking beyond 2030
(COM(2023) 168).
238
Directive (EU) 2022/2464 of the European Parliament and of the Council of 14 December 2022 amending Regulation
(EU) No 537/2014, Directive 2004/109/EC, Directive 2006/43/EC and Directive 2013/34/EU, as regards corporate
sustainability reporting. It applies to applies to all Limited Liability Companies (LLC) which are not SMEs as defined by
the accounting Directive, and all LLC companies listed on a regulated market (including listed SMEs) but excluding micro-
enterprises.
239
Where a company is listed on the stock exchange, they are unlikely to be controlled by a third country government. The
assessment would need to be made on whether they are acting based on instruction from a third country government.
240
See note 142.
60
overriding legitimate interest, and thresholds limiting the powers of supervisory authorities to
ask for information.
However the extended requirements in PO2.2 would impose more costs and further restrict the
freedom to conduct a bussiness and could have disportionate effects on the freedom of
association and the freedom of the arts and sciences and have greater geopolitical implications.
7.5. Comparison of options
The options are compared against the criteria of effectiveness, efficiency, coherence and
proportionality.
In the context of this initiative, effectiveness describes to what extent each option would
achieve the specific objectives defined in chapter 4.2, i.e. to facilitate cross-border interest
representation activities carried out on behalf of third countries when done transparently (1)
and to improve knowledge about the magnitude, trends and actors of interest representation
carried out on behalf of third countries (2). PO2.1 proves to be most effective with regard to
objective 1, PO2.1 and PO2.2 are equally effective with regard to objective 2.
Efficiency assesses the anticipated costs of the measures against the expected benefits of
increased effectiveness. PO2.1 performs best in terms of efficiency, notably because of the
higher costs that PO2.2 would generate without being more effective.
Coherence describes how the proposed measures would complement existing and planned
initiatives. Both PO2.1 and PO2.2 would be most coherent with other initiatives.
Proportionality relates effectiveness against efficiency and any negative impacts. PO1 and
PO2.1 would be proportionate to the objectives set while PO2.2 would impose more costs,
further restrict the freedom to conduct a business and could have disproportionate effects on
other freedoms and diplomatic relations.
Table 6: Comparison of options against the baseline
Options Effectiveness Efficiency Coherence Proportionality Result
1 2
Baseline 0 0 0 0 0
Option 1 + + + + +
Option 2.1 +++ ++ ++ ++ ++ Preferred
option
Option 2.2 ++ ++ + ++ -
The table should be read in horizontally: the symbols have the same meaning as in table 5. Methodology is
explained in Annex 4.
8. PREFERRED OPTION
8.1. Description of the preferred option
Against this assessment, the preferred option consists in a legislative intervention with targeted
requirements.
This option would best meet the general objectives as well as the specific objectives of this
intervention. The harmonised requirements should provide the legal certainty and level playing
field necessary to remove the obstacles identified in the internal market. It would also prevent
further fragmentation. The transparency requirements should provide sufficient information to
improve knowledge about the magnitude and trends of interest representation carried out on
behalf of third countries. This option is less intrusive as it would limit the costs on national
administration while facilitating carrying out interest representation activities on behalf of third
country entities across borders and facilitate cross-border cooperation between national
61
authorities. Finally, this option is less intrusive in terms of impacts on fundamental rights, in
particular with regard to the freedom of association and the freedom of the arts and sciences
and has limited geopolitical implications.
8.2. The choice of instrument
With regard to the choice of instrument, under the legal basis of Article 114 TFEU, both a
Regulation, or a Directive providing for full harmonisation, would support the attainment of
the general and specific objectives. In the stakeholder consultation, 4 CSOs out of 11 and 1
Member State out of 15 have expressed a preference for a Regulation. 5 Member States do not
want to harmonise transparency requirements for interest representation carried out on behalf
of third countries and prefer policy option 1. The other 9 Member States do not position
themselves on the choice of instrument under the legal basis of Article 114 TFEU.
Having recourse to a Regulation241
has the advantage of being of direct application without
having to wait that Member States have transposed the Directive in national law, which could
be a benefit due to the urgency to take action against the problems identified by the initiative.
A Directive providing for full harmonisation of the transparency requirements applicable to
entities carrying out interest representation on behalf of third countries conducted with the
objective of influencing the development, formulation or implementation of policy or
legislation, or public decision-making processes in the internal market, is the most suitable
option. It would set legally binding standards to be met in all Member States while leaving
some flexibility in particular regarding the articulation with existing transparency registers.
By providing for full harmonisation, the Directive will provide a uniform regulatory
framework, removing internal market barriers and increasing legal certainty for interest
representatives in the internal market on the basis of a proportionate standard. Member States
would, within the framework of the harmonised rules, be prohibited from diverging from the
rules including by laying down more extensive transparency requirements (so-called “gold
plating”). The Directive would provide for a harmonised comprehensive system of safeguards,
including effective judicial review, harmonised sanctions limited to administrative fines,
independent supervisory authorities, obligations to prevent stigmatisation, in particular to
ensure that no adverse consequences arise from the inclusion of an entity in the register.
The competence of Member States to establish rules, in full respect of EU law, for the aspects
not covered by the harmonised rules will not be affected, for example, to establish rules for
their public officials contacting entities carrying out interest representation activities on behalf
of third countries or regulating the legality of the availability of interest representation activities
carried out on behalf of third countries.
8.3. Application of the “one in, one out” approach
An overview of estimated costs is provided in Annex 3 with methodology in Annex 4.
Table 7: Costs related to the ‘one in, one out’ approach
Citizens Businesses
One-off Recurrent One-off Recurrent
241
A Regulation must be complied with fully by those to whom it applies and is directly applicable in Member States. This
means that it applies directly after its entry into force in Member States, without needing to be transposed into national
law, that can create rights and obligations for individuals, who can therefore invoke it directly before national courts, and
that it can be used as a reference by individuals in their relationship with other individuals, Member States and EU
authorities.
62
Direct and
indirect
adjustment
costs
n/a n/a EUR 71.2 million to
EUR 213.8 million total
familiarisation costs
n/a
Administrative
costs per year
n/a n/a n/a EUR 615,000 to EUR
921,000 registration and
information disclosure
costs (average EUR
768,000)
9. HOW WILL ACTUAL IMPACTS BE MONITORED AND EVALUATED?
A report on the implementation of the legislative measures contained in the preferred option
would take place at the latest by 12 months after the deadline for Member States to transpose
the Directive. The Commission would also carry out an evaluation242
of those legislative
measures at the latest by 4 years after the transposition deadline. This evaluation will also assess
potential changes to the scope of the Directive, as well as the effectiveness of the safeguards
provided therein.
Data on the following objectives and indicators will be collected through Eurobarometer and
other surveys directed to citizens and stakeholders (entities carrying out interest representation
activities on behalf of third countries, interest parties (journalist, researchers), public officials
and enforcement authorities), as well as through cooperation with Member States authorities
in charge of the implementation of the measures contained in the preferred policy option. Data
from external agencies and stakeholders (CSOs, researchers, etc.), could also be used. This data
collection effort will also be addressed specifically in the work programme for the European
Cooperation Network on Elections (ECNE)243
.
242
The Commission will present these reports to the European Parliament, the Council and the European Economic and Social
Committee.
243
The European Cooperation Network on Elections (ECNE) brings together representatives of Member States’ authorities
with competence in electoral matters and allows for concrete and practical exchanges on a range of topics relevant to
ensuring free and fair elections. Meetings are organised by the Commission.
63
Table 6: monitoring and evaluation of the impacts
Specific
objectives
Operational Objectives Proposed indicators Data sources
SO1: Facilitate
cross-border
interest
representation
activities
carried out on
behalf of third
countries when
done
transparently
Establish common transparency standards for intrest
representation activites carried out on behalf of third country
entities which provide economic actors with:
• Clear common framing for intrest representation activites
carried out on behalf of third country entities;
• Clear and proportionate specific obligations for entities
carrying out intrest represenation on behalf of third country
entites, on the basis of clearly defined key terms;
• Reduced costs and risk for providing intrest representation
activites carried out on behalf of third country entities;
• A level playing field for all relevant economic operators.
• Access to the cross-border
market for interest
representation activities carried
out on behalf of third countries
(baseline unknown).
• Increase in the completeness of
information provided on
interest representation activities
carried out on behalf of third
countries (e.g. name of entities
whose action can be attributed
to third country goverments,
description of the interest
representation, information on
the remuneration provided);
Data collected in the national
registers (on trends in terms of
cross border intrest
representation, completeness of
the data provided, etc.) (baseline
unknown)
Stakeholders’ reports (the
baseline is the respondents’
response to the consultations)
Number of legal dispute relating
to the enforcement of the prefered
policy option244
(some of the data
of Member States with registers
may be used as a baseline)
SO2: Improve
knowledge
about the
magnitude and
trends of
interest
representation
carried out on
behalf of third
countries
Ensure that the common standards established at EU level
provide individuals with sufficient transparency to enable them
to:
• Know the magnitude of intrest representation carried out on
behalf of third countries in their Member States and the EU.
• Know the identity of the actors and interests represented on
behalf of thrid country entities.
• Estimates of intrest
repesentation carried out on
behalf of third countries;
Data collected in the national
registers (aggreagate numbers of
entires in the national registers)
(some of the data currently in
national registers may be used as
a baseline)
Surveys of citizens (the baseline
is the respondents’ response to
the OPC and the
Eurobarometers245
).
Ensure that the common standards established at EU level provide
stakeholders including researchers, journalists interested in
the political process of interest representation activites carried out
on behalf of third countries with sufficient transparency about
• Compliance with the
transparency standards as
reported by interested
Eurobarometers (baseline
unknown)
244
It could cover, for examples dispute liked to the obligation to register, to correct or delete data, or to contest acts taken by Member States supervisory authorities.
245
Flash Eurobarometer 528 on Citizenship and Democracy.
64
Specific
objectives
Operational Objectives Proposed indicators Data sources
• The network of actors involved;
• The amounts of money spent on interest representation activites
carried out on behalf of third countries per activity and per third
country;
• Meaningful details about the interest representation activities
being carried out, the decision-making processes targeted, and
link this to any wider associated campaign.
stakeholders (mainly
qualitative).
Survey and reports of
stakeholders’ (researchers,
journalists, etc). (baseline
unknown)
Comparaison with stakeholder
data where available. (baseline
unknown)
Ensure that the common standards established at EU level provide
public officials with sufficient transparency to enable them to
determine:
• Whether they are in contact with an entity carring out intrest
representation activity on behalf of a third country entity;
• Meaningful details about the entity whose intrest is being
represented, the interest representation activities being carried
out and the decision-making processes targeted.
• Compliance with the
transparency standards as
reported by interested
stakeholders (mainly
qualitative).
Survey and reports of
stakeholders (public officials)
(baseline unknown)
Ensure that the common standards established at EU level provide
supervisory authorities of Member States with sufficient
transparency to enable oversight and enforcement of the
transparency measures provided by the preferred option by
enabling them to obtain
• Effective access to records kept by entity carrying out intrest
representation on behalf of third countries identified as
spending significant amounts on intrest representation in the EU
or a Member State (risk-based approach)
• Effective cross-border sharing of information;
• A mapping of the actors involved in interest represtnation
activites;
• The amounts of money spent on interest representation activites
carried out on behalf of third countries per activity and per third
country;
• Meaningful details about the decision-making processes
targeted, and link this to any wider associated campaign.
• Compliance with the EU level
standards by entities carriyng out
interest representation on behalf
of thrid country entities.
• Number of cross-border
information requests.
Data shared by Member States
(some of the data currently in
national registers may be used as
a baseline)
Comparaison of the data collected
in the national registers to identify
outliers (some of the data
currently in national registers
may be used as a baseline)
Stakeholders’ reports (including
report by the advisory groups
composed of representatives of
national supervisory authorities)
(baseline unkown)
65
Annex 1: Procedural information
1. Lead DG, Decide Planning, CWP references
The Staff Working Document was prepared by the Directorate-General for Justice and
Consumers.
The Decide reference of this initiative is PLAN/2023/68.
This initiative was announced in the September 2022 State of the Union speech by President
of the Commission von der Leyen and follows the Commission Work Programme for 2023.
2. Organisation and timing
The Impact Assessment was prepared by DG JUST as the lead Directorate General.
The Inter-Service Steering Group (ISSG) was set up in October 2022 under the coordination
of the Secretariat-General and gathered representatives of the Legal Service, DG JRC (Joint
Research Center), DG NEAR (Neighbourhood & Enlargement Negotiations), DG HOME
(Migration & Home Affairs), DG GROW (Internal Market, Industry, Entrepreneurship &
SMEs), DG INTPA (International Partnerships), DG RTD (Research & Innovation), DG
CNECT (Communications Network, Content & Technology), DG COMP (Competition), DG
EAC (Education, Youth, Sport and Culture) and the European External Action Service.
The ISSG was consulted on the concept note, the consultation strategy, main legislative and
non-legislative options and the interim and final reports of the supporting study. On a number
of other deliverables, such as the questionnaire for the Open Public Consultation, services were
consulted separately in writing.
ISSG meetings, chaired by the Secretariat-General, were held on 10 October and 30 November
2022, 31 March, 26 September 2023.
The last meeting of the ISSG, chaired by the Secretariat-General of the European Commission
was held on 5 October 2023.
3. Consultation of the RSB
An upstream meeting took place on 18 September 2023 and the recommendations of the
Regulatory Scrutiny Board were duly taken into account.
The Regulatory Scrutiny Board discussed the draft impact assessment in the hearing that took
place on 15 November 2023.
The Board issued a positive opinion with reservations on the draft impact assessment. The
Board’s recommendations have been taken into account in the Impact Assessment, as the table
below displays.
Opinion of the Board Implementation
The report should provide a coherent and
unambiguous narrative for this initiative
focusing on legal interest representation
services on behalf of third countries in the
The introduction and the description of
options sections have been updated to
provide a clearer narrative for this initiative
focusing on legal interest representation
66
internal market of EU. The assessment
should more precisely identify the gaps this
initiative intends to fill and how it articulates
with the wider set of initiatives on the
defence of democracy. The report should
provide a clear scope for the EU action,
especially in terms of activities and
organisations to be regulated. It should make
it clear that the initiative covers legal
activities.
services on behalf of third countries in the
internal market of EU. The impact
assessment clarifies in the baseline how the
initiative relates to other legislation and
initiatives proposed in the context of the
Commission’s ambition to strengthen and
defend democracy. The added value of the
initiative was further highlighted. The
section on the policy options and the scope
was modified in order to clarify that the
initiative only covers legal activities, i.e.
interest representation activities carried out
on behalf of third countries, and that there are
limited, but clearly defined exceptions with
regard to the organisations and activities that
are covered.
The analysis should bring out more clearly
the key policy choices of the policy options.
The report should better explain how the
various measures would work in practice.
The assessment should better articulate the
mitigation measures regarding potential
issues of ‘stigmatisation’ of legitimate
representation activities. It should elaborate
in more detail on measures to avoid potential
circumvention of the transparency rules for
third country interest representation taking
into account that “core funding” of relevant
actors is not per se in scope of this initiative.
The description of policy option has been
updated and drafting has been improved to
evidence the key policy choices (targeted
intervention or extended intervention). A
chapter on discarded policy options has been
added to highlight options considered but not
pursued further. The mitigation measures to
reduce the risk of stigmatisation were further
detailed in the chapter on the impacts of the
initiative on the freedom of association. The
description of the policy options (section 5.3)
explains better why core funding is not per se
in the scope of the initiative and how national
supervisory authorities shall prevent that
contributions to the core funding of entities
are used to circumvent the transparency
rules.
The impacts of the different policy options
should be adequately differentiated, in
particular as regards a realistic evaluation of
the degree of take up of the various policy
measures in case of a recommendation. The
report should better explain how the potential
sanctions would work and how effective they
could be.
The impact assessment was refined by
providing two different costs scenarios
according to different levels of take-up of the
legislative measures by Member States (full
take-up and 50% take-up), with a detailed
analysis in Annex 4.
In section 5.3.2.1, the impact assessment
describes in more detail how the sanctions
regime would work, notably which factors
would be taken into account in order to
determine the exact amount of a potential
sanction.
67
The report should describe in greater detail
the considered governance structure, and
how it would work to ensure appropriate
implementation and enforcement. It should
explain what new elements and structures
would be developed and who would be
responsible for, e.g., IT tools (including
registers), governance structure, supervisory
bodies, annual reports, etc. It should further
clarify how the national supervisory
authorities would operate, and how
cooperation among Member States would be
structured. Finally, it should better explain
the role of the Commission in this
governance structure.
The impact assessment was refined regarding
the governance structure foreseen by the two
legislative options. The obligations for
Member States to establish or designate one
or more authorities were further detailed. It
was added that the Internal Market
Information System (‘IMI system’)
Regulation would support the administrative
cooperation and the exchange of information
using existing IT tools. The impact
assessment describes in greater detail how
the cooperation among Member States would
be structured via a governance cooperation
mechanism at EU level. The Commission’s
role is better explained (no direct
enforcement role, but right to request data
from Member States).
4. Evidence, sources and quality
The evidence base is drawn from internal and external research, literature review, extensive
consultation activities, bilateral meetings with stakeholders, and was supported by an external
study available here: https://commission.europa.eu/document/455c1bda-8c39-48f0-971c-
86758f8b7c90_en . In particular, evidence was based on the following:
• The preparatory studies and open consultation for the European Democracy Action
Plan, transparency of political advertising initiative and the 2020 EU Citizenship
Report;
• The implementation of the Commission’s September 2018 electoral package, as
described in the Commission’s report on the 2019 elections;
• The Commission toolkit on Tackling R&I foreign interference;
• European Parliament resolution of 10 October 2019 on foreign electoral interference
and disinformation in national and European democratic processes (2019/2810(RSP));
• European Parliament resolution of 9 March 2022 on foreign interference in all
democratic processes in the European Union, including disinformation
(2020/2268(INI));
• European Parliament resolution of 17 February 2022 with recommendations to the
Commission on a statute for European cross-border associations and non-profit
organisations (2020/2026(INI));
• European Parliament studies, including those prepared for the INGE committee;
• International organisations and bodies documents, research and recommendations, such
as the OECD, the OSCE, the Council of Europe or International IDEA;
68
• An Open Publication Consultation;
• A series of Focus Group meetings with relevant stakeholders;
• A Flash Eurobarometer on Citizenship and Democracy;
• A Flash Eurobarometer on Democracy;
• The work of the European Cooperation Network on Elections
• A targeted consultation with relevant stakeholders
69
Annex 2: Stakeholder consultations
1. The consultation strategy
The Commission conducted a first wave of wide consultations of stakeholders on issues
relevant to transparency of interest representation activities carried out on behalf of third
countries, free, fair and resilient elections, and civic engagement, between October 2022 and
May 2023.
Following on the first wave of consultations, the Commission sent out additional questionnaires
on potential policy options to Member States authorities, commercial entities and CSOs on 4
August 2023 with a (extended) deadline for contribution on 25 September 2023.
A Public Consultation, accompanied by feedback on the Call for Evidence document was
published on 16 February 2023 and ran until 14 April (8 weeks). Feedbacks and contributions
from stakeholders helped further developing problem definitions and policy options.
The Commission also ran a Flash Eurobarometer on Citizenship and Democracy and a second
on Democracy. The 2 Eurobarometers are still unpublished.
The Commission organised in this period a series of focus groups meetings with relevant
stakeholders, to gather additional evidence and data on the issues addressed by the package,
the potential policy options, and their impacts. It also conducted bilateral consultations and met
with stakeholders, at their own initiative. The Commission received additional feedbacks.
Finally, the Commission contracted an external study to support its work on this package. As
part of this study, the contractor also conducted a series of individual consultations with key
stakeholders.
Relevant work in the European Parliament (including the Special Committee for foreign
interference in all democratic processes in the EU, including disinformation) provided further
input to the Commission analytical process. The Council of the European Union’s work
(including in the relevant working parties) has also provided valuable input.
The original consultation strategy had identified the following stakeholders with the aim of
gathering their input:
1. Commercial actors, covering entities engaged in interest representation activities,
including public relations and lobbying firms;
2. Legal professionals involved in interest representation;
3. International organisations and standards setting bodies;
4. Research bodies, education entities and Academia;
5. Non-commercial actors, including CSOs, human rights defenders and think-tanks;
6. Political actors – including candidates, parties, foundations, campaign and activist
organisations in the Member States, at national and European level. Local and regional
political actors should be considered, as well as their representative bodies at a
European level.
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7. Public authorities – national authorities with competence to monitor and enforce
relevant rules, transparency obligations and electoral commissions, including via the
European Cooperation Network on Elections;
8. General public, including EU and non-EU citizens, through the Public Consultation.
The methodology, consultation tools, overview and analysis of the results are further described
below.
2. Public consultation
The Public Consultation was launched on 16 February and ran until 14 April (8 weeks). It was
opened to everyone, from EU citizens to private companies. A communication campaign on
the Public Consultation was organised by the Commission, including social media posts to
reach out to specific entities and individuals, and communication on the Commission’s website.
This campaign reached out to 6,501,095 people.
In total, 852 responses were received in the context of the Public Consultation. The majority
of respondents were from the EU, with only 12 from outside the EU. Their main countries of
origin were France, Slovakia, Belgium and Spain. The vast majority of feedback was received
from EU citizens (92%). Non-Governmental Organisations amounted for 3.5% of the
respondents. However, only 3 company/businesses replied to the consultation.
2.1. Results
The public consultation was divided into 4 main sections, with some answers available only to
those ticking dedicated boxes corresponding to specific requirements.
a. On interest representation and foreign interference
This specific section of the public consultation examined perceptions on entities that can
significantly influence public decision-making processes and, more specifically, posed the
question of which entities are more likely to create a risk of covert interference of third
countries in the European democratic space.
− Lobbying is perceived as having the highest potential to significantly influence
legislation in the EU. A total of 802 respondents (96.4%) labelled lobbying as either
very (83.2%) or somewhat (13.2%) influential.
− The activities of ‘Public relations, advertising, media campaigns, including social
media’, and of political parties are also considered as having the potential to
significantly influence legislation or other public decision-making processes. More
specifically, public relations activities were considered as very or somewhat influential
by a combined 91.2% of respondents, while the same figure for activities of political
parties was 91.5%.
− Whilst the extent of influence for the remaining activities listed (‘Education and
training’, ‘Research’ and the ‘Organisation of conferences’) was not perceived to be as
influential, respondents still considered them to be able to influence the legislation
making process to some degree.
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The public consultation then focused on examining the EU perception of risks of interference
with the European democratic space and public debate related to the control or remuneration
of influential activities by third countries.
− Lobbying and public relations activities remunerated by or controlled by third countries
are perceived by stakeholders to pose the greatest risk to the European democratic
space, with 86.6% considering this factor to trigger a high risk.
− A total of 79.8% considered political parties funded by third countries or
funded/supported by entities based in third countries to be a factor that can trigger high
risk.
− Cyberattacks on digital election tools and electoral infrastructures are also perceived to
be likely to create particular risks, as 74.5% labelled these activities as a factor
triggering a high risk and 16.9% a moderate risk.
− Finally, the activities of think tanks remunerated by or controlled by third countries
were perceived by 66.9% to constitute a high-risk factor and by 25.8% to pose a
moderate one.
Therefore, the public consultation illustrates that, while all noted activities are perceived to
carry the potential to influence and a risk of interference, lobbying entities and political parties
are both perceived to retain a particularly high level of influence towards legislation and at the
same time can trigger the highest risk of third country covert interference.
b. On transparency and other requirements
Overall, the public consultation responses highlighted just how much transparency
requirements are valued and perceived to be imperative across the EU-27. Almost the entirety
of respondents (95.6%) believes that there is a need to provide more transparency in the EU
regarding lobbying, public relations activities or any other activity conducted for third countries
that significantly impacts the democratic sphere.
In addition, the respondents largely agreed that every single type of information listed in the
public consultation should be provided by entities conducting such activities (more than
92.5%). This includes information about the origin and amount of funding, the position of third
countries and other entities vis-à-vis financing, and the purpose of financing. This continues to
highlight a trend found across the public consultation responses of a need for more information
to be made available and for transparency across the EU.
Considering other means to combat the influence risks highlighted in the first section,
respondents were asked about the role of civil society and citizens more generally in the context
of policy-making. Effective and inclusive engagement with both independent civil society
and citizens in the context of policy-making processes is perceived to be important or very
important by a large majority of respondents.
On this basis, respondents were then asked about possible measures to improve the
engagement, inclusiveness and effectiveness of participatory processes for citizens and CSOs.
The measure considered most necessary – selected by 64.2% of respondents – was the
implementation of dedicated structures to support civil participation in policy-making
processes (such as open online consultation, platforms to provide feedback). Following this,
the most popular response options were the dissemination of clear, adequate and timely
information about participation opportunities, modalities and objectives (51.3%) and capacity
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building for citizens, including at local levels, on how to better engage in the policy-making
process (41.9%).
Finally, the vast majority of respondents agreed or strongly agreed that there is a need to
increase the engagement of CSOs and citizens through purposefully organised processes in
policy-making at all local, national and European levels (more than 60% strongly agreed and
more than 20% agreed in all cases).
c. On codes of conducts, self-regulation and standards
The questionnaire then focused on the topic of codes of conduct, self-regulation and standards,
and showed that even though the stakeholders agree that the prioritisation of transparency and
accountability is crucial, there seems to be a lack of knowledge or availability of best practices
on the topic across the EU.
d. On free, fair and resilient elections
The final section of the public consultation related to the topic of free, fair and resilient
elections, where questions focused on measures that could be taken to promote resilient
electoral processes and protect election-related infrastructure.
When questioned about the importance of certain measures that could be taken by Member
States to promote resilient electoral processes and protect the infrastructure that is critical for
the organisation of elections, it is notable that respondents perceived each of the measures listed
to be important. The most heavily supported measure was the need to focus on cyber security
of electoral processes and related infrastructure, such as introducing incident notification rules.
Two additional sections (‘Other’ and ‘Concluding remarks’) were available to respondents to
add any further information and/or upload any concise document. In total, 24 documents were
received from respondents, mostly from CSOs and more specifically Non-Governmental
Organisations, which were carefully analysed.
2.2. Position of stakeholders in the public consultation
a. Position of EU Citizens
Overall, EU Citizens indicated that EU action is needed to tackle foreign interference in
democratic processes and to increase transparency of lobbying, public relations activities and
any other activities that, when carried out on behalf of third countries, could significantly
impact the democratic sphere. EU Citizens have expressed support for proposing transparency
on this matter, while stricter transparency requirements and ethical obligations for public
officials, candidates to elections and their staff were also mentioned.
In addition, the majority of respondents called for more involvement of CSOs and citizens in
the policy-making process, and for more education about the EU.
b. Position of CSOs
CSOs expressed their support to a package aiming at defending democracy and to EU-wide
measures increasing transparency of lobbying and public relations activities. However, some
expressed strong concerns over the Directive potentially being seen as a “Foreign Agent Act”,
based on international precedents. Many of them stressed the need to fight against all
democratic challenges, including those coming from within the EU, and not focus only on
foreign risks. Most of them stressed the need to respect fundamental rights and the principle of
proportionality and to avoid any potential stigmatisation of CSOs.
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Additionally, CSOs called for more long-term funding opportunities and reminded of the
important role they plan in defending and protection democratic values. They asked to be more
involved in decision-making processes and called for more regular and inclusive consultations
of CSOs and citizens.
3. Feedback on the call for evidence document
Feedback on the Call for Evidence document ran from 16 February to 14 April 2023, on the
Have Your Say portal. In total, 1,198 responses were provided, the vast majority being EU
Citizens (91%), with further inputs by 63 non-governmental organisations (5.2%). Most of the
feedback was submitted by stakeholders based in Slovakia (70.3%), most of whom were
responding as EU citizens. Other notable countries of origin of respondents were DE, FR, BE
and AT.
A significant number of responses with similar (or identical) sentiments were submitted,
spanning multiple languages and countries of origin. Indeed, the Have your say website
identified a campaign of similar feedback, based on 11 matching submissions submitted by
anonymous respondents from DE.
In addition, some submissions appeared to be copy-pasted with guide words, potentially used
as part of a coordinated campaign. For example, “support the opinion:” (or “Podporujem
názor:” in Slovak) was included at the beginning of the submissions.
4. Dedicated stakeholders’ meetings
4.1. Focus Groups
The Commission organised a series of focus group meetings from November 2022 to April
2023, with relevant stakeholders as identified in the consultation strategy. The aim of these
focus groups was to gather additional evidence and data on the issues addressed by the package
from actors on the ground, to build on their experience.
Focus groups lasted 1.5 hours and the discussions were organised around 4 main strands:
foreign interference, transparency measures, safeguards and free, fair and resilient elections. A
list of guiding questions was sent to all participants ahead of the meetings, containing general
questions posed to all stakeholders, as well as more specific questions targeted at the
particularities of the different groups.
While organising the focus groups, the Commission ensured representativeness and
inclusiveness in the selection of all participants.
Overall, participants to the Focus Groups expressed their support for an initiative covering
foreign interference and common transparency rules for interest representation activities.
a. Focus group with international standard setting bodies
This focus group gathered representatives of the Council of Europe, including the Venice
Commission, ODIHR, International IDEA, the OECD and UNESCO. Colleagues from the
EEAS also attended the focus group.
Participants expressed concerns about the influence of third countries in democratic processes
and stated that some of their organisations were currently working on this issue. They
highlighted that key stakeholders need to be equipped with adequate tools to tackle it, and that
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additional evidence is needed to understand the best policy-making solutions, notably to close
legislative loopholes.
Participants agreed that transparency is the best solution to tackle the problem of foreign
interference. Some of them additionally highlighted the need to tackle disinformation and to
discuss foreign funding of political activities. Finally, they discussed safeguards to be
considered (e.g. elections observations, oversight bodies to enforce transparency measures
related to candidates or politicians, etc) and potential risk-assessments.
b. Focus group with academia and research organisations
This focus group gathered members of academia and research organisations talking in their
personal capacities.
Most researchers agreed that there is some urgency when it comes to interference by third
countries in the research sector, with a few experts disagreeing based on lack of evidence.
Participants emphasized the role of individual researchers in responding to the issues of
interference and agreed that any measures taken would have to be taken cautiously in order to
respect the principles of independent review.
Participants underlined the importance of international cooperation in research and indicated
that only authoritarian states should be considered to be a threat (and not all third countries). It
was also agreed on by the participants that transparency could contribute to the awareness and
ethics of researchers but not necessarily bring more incidents into light.
c. Focus group with legal experts
This focus group gathered legal professionals and experts, such as lawyers, representatives of
law associations and of administrative judges’ associations.
The majority of participants agreed that the issue of interference by third countries in the
democratic sphere of the EU should be tackled urgently, as there is evidence of it having an
impact on legal professions. In particular, most of them emphasised the importance of setting
up transparency requirements on the funding of CSOs and foundations aiming at influencing
EU policies.
Finally, participants finally discussed the differences between legal representations of clients
and interest representation activities. Many of them consider the distinction achieved in the
Transparency Register appropriate.
d. Focus group with commercial entities involved in interest representation
This focus group gathered professionals working for commercial entities involved in interest
representation, notably lobbying firms, consultancy companies and representatives of lobbying
associations.
Participants all indicated to be registered in the EU Transparency Register, and most of them
declared to also incentivise their clients to register, which they all believe is a useful tool. They
highlighted the fact that the issue of foreign interference might lie with the entities not
registered.
Moreover, participants confirmed that consultancies conduct due diligence before taking on
new clients. Participants also agreed that policy-makers should only be allowed to meet with
entities registered in the EU TR.
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Several participants declared to be in favour of a harmonisation of all Transparency Registers
with a single EU-wide number for registrants. They emphasised that the different systems
across the EU related to registration and transparency requirements, which are highly
distinctive between each market, pose a major challenge to interest representation as an
industry.
e. Focus group with members of the European Lobby Registrars Network
This focus group gathered EU members of the European Lobby Registrars Network.
Participants presented the specificities of their national lobby registers, their rules, the actors
covered, accompanying codes of conducts, as well as oversight and compliance mechanisms.
Participants identified foreign interference as an important topic and expressed the need to
tackle it. Finally, they discussed the safeguards and legislative loopholes to be addressed.
f. Focus group with CSOs and non-commercial actors involved in the defence of
democracy
The focus group with CSOs and non-commercial actors involved in the defence of democracy
was introduced by a member of the cabinet of Commission Reynders, who emphasised the key
role of CSOs for the well-functioning of our democracies and introduced the package.
Some participants expressed their concerns that CSOs seem to be considered as a problem, and
not a solution to tackle foreign interference and protect the EU democratic sphere. They
condemned the presumption of culpability when it comes to relations between institutions and
CSOs. The majority of participants declared never to have been confronted with issues of
foreign influence. They asked for more support to CSOs, included more funding from the EU.
Participants added that additional transparency measures could be burdensome and difficult to
comply with for most CSOs, agreeing that they already must comply with many reporting and
transparency requirements. They stated that public officials should follow integrity standards.
g. Focus group with commercial entities involved in cross-border interest
representation services
Following a first meeting with professionals involved in interest representation (see point d.
above), this second focus group gathered commercial entities involved in interest
representation, with the aim to focus on cross-border activities and having to comply with
different registration and transparency requirements.
Participants expressed their support for an initiative covering foreign interference, and stated
they would welcome common transparency rules, as this would not only facilitate their
registrations but also prevent market and reputational issues for companies and clients. They
emphasised the challenges of having to comply with different systems and rules across Member
States.
h. Focus group with grants beneficiaries of CERV programme working on
projects related to the 2024 elections to the European Parliament
This meeting was a second focus group gathering CSOs, with the aim to focus on those
receiving funds under the CERV programme and working on projects related to the upcoming
elections to the European Parliament.
During this focus group, participants largely considered that the main barriers to turnout in
elections to the European Parliament were the lack of information about the EU among the
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general population, and the lack of participative and deliberative democracy between elections.
They argued that actions at the local level and more engagement and support to CSOs would
help increasing turnout, inclusiveness and understanding of elections. They highlighted the
importance of increasing trust and transparency of decision-making processes at the EU level.
i. Focus group with European Political Parties and Foundations
A focus group was organised with European Political Parties and European Foundations. Most
participants said never to have been directly affected by foreign interference, but agreed it was
a pressing issue. Some of them, however, declared that any additional measures on political
parties would be burdensome, or even counter-productive, as some of their members are parties
based in third countries. The question of providing a level playing field in terms of transparency
requirements between entities impacting democracy was raised.
On the part related to free, fair and resilient elections, participants agreed there is a general lack
of knowledge about citizen’s rights, the elections to the European Parliament and the general
functioning of the EU. References were made to the proposed new electoral law, as a means to
increase turnout and citizen’s representativeness in elections.
j. Focus group with Local Authorities
This focus group gathered representatives of local authorities.
While some participants agreed foreign interference is a growing problem for local
democracies, others said not to have experienced it at the local level. A participant mentioned
that a priority for Baltic cities was to ensure resilience of cities and local authorities. Most of
participants also expressed concerns on cyberattacks and disinformation.
Participants additionally shared best practices and examples of local democratic processes,
such as innovative participatory mechanisms and co-governing processes.
k. Focus groups with Member States
Two Focus groups were organised with Member States, which welcomed the upcoming
package, agreeing that foreign interference in democratic processes is a growing issue which
needs to be tackled. They recalled the need to respect the principles of subsidiarity,
proportionality, fundamental rights and to keep a whole-of-society approach. All Member
States consider transparency as a key measure to tackle foreign interference.
On free, fair and resilient elections, Member States discussed the fight against disinformation,
asked for more inclusiveness in elections and called for more awareness-raising among
citizens.
Discussion with Member States also took place in Council Working Groups and in the
framework of the European Cooperation Network on Elections.
4.2. Meetings with stakeholders
The Commission conducted bilateral meetings with a diverse range of stakeholders, including
Member States and CSOs, at their own initiative.
The Commission held regular meetings of the European Cooperation Network on Elections
(ECNE) as follows: 15th
ECNE meeting November 2022, 16th
ECNE Meeting January 2023
and 17th
ECNE meeting 29th
March 2023. At the last meeting, Member States exchanged their
views on the package.
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On several occasions, the Commission also met with Members of the European Parliament,
notably from the INGE committee.
5. Ad hoc contributions
The Commission received 25 written contributions via email outside of the official consultation
process. Some of these contributions were made following the different focus groups, while
others were sent due to having missed the deadline of the Open Public Consultation.
The Commission received 3 follow-up emails to the focus groups from CSOs, expressing their
concern on the way the discussion on the package was framed and asking to avoid any potential
stigmatisation of CSOs.
The EU Foundation Sallux provided further input on the status and challenges of European
political parties and Foundations.
The Fundamental Rights Agency sent a letter to the Commission to stress the need that the
Defence of Democracy package should aim to protect the fundamental rights enshrined in the
Charter and called for proportionate measures.
The European Institute for Gender Equality (EIGE) welcomed the Commission’s call for
evidence and provided further data on gender equality in the EU in relation to the Defence of
Democracy package, notably on gender inequality in elections.
The Public Relations company First PR (based in Poland) sent additional information they
gathered on the future of disinformation and the importance to tackle the issue to protect our
democracies.
The company The Logically Ltd. shared their written contribution, focusing notably on the
impact that online disinformation can have on voter turnout. They called Member States and
political parties to step up efforts to promote voter turnout and inclusive participation in
elections.
The Society of European Affairs Professionals, recalled its commitment to the highest
standards of ethical conduct in public affairs. They reminded the Commission of the benefits
of lobbying within the EU decision-making process and that it is a legitimate act of political
participation, when done transparently and with integrity. SEAP stated that the impact on
public affairs professionals of additional transparency requirements regarding activities
conducted for third countries would vary according to the measures envisaged but could be
burdensome for smaller actors involved in interest representation, including not-for-profit
organisations.
An individual EU citizen sent a note to the Commission asking to take into consideration the
outcome of the Conference on the Future of Europe in the drafting of the package.
The European University Association welcomed the package but emphasized the need to
carefully balance the instruments, to fully empower civil society as democratic actors, and
ensure dialogue. They called the Commission to respect academic freedom and protect it.
The Erfurt University of Applied Sciences also welcomed the initiative and the recognition of
civil society as a cornerstone of democracy, but argued there is an urgent need to focus on
ensuring long-term funding of CSOs.
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Finally, the Commission received position papers from several CSOs246
, expressing common
concern about the potential impacts of the Directive on civic space, fundamental rights and
pointed the risk of misuse by malicious actors. They regretted the lack of an impact assessment
accompanying the Defence of Democracy package and recalled the need to respect the
principles of proportionality and necessity. These position papers generally welcome the
inclusion of a recommendation on civic engagement, called for more structured dialogue and
collaboration with Civil Society Organisations and for better long-term funding opportunities.
Following the focus groups, 10 Member States (France, Poland, Spain, Finland, Belgium,
Lithuania, Slovenia, Romania, Germany, and Ireland) also sent their contributions via email.
Member States welcomed the initiative and agreed that tackling foreign interference is a
growing issue and that transparency is a key priority at national level. They, however, stressed
the importance of respecting fundamental rights, the principles of proportionality, subsidiarity
and taking a whole-of-society approach.
Ad hoc bi-laterals between the Commission and interested Member States and their authorities
also took place.
6. Specific consultations conducted by contractor
The contractor conducted a specific and extensive consultation, by the means of interviews,
targeted at different stakeholder groups. The interview programme originally aimed to consult
35-40 stakeholders across key groups.
This table presents a breakdown of the individual stakeholders contacted (16), as well as the
62 interviews performed across key stakeholder groups.
Stakeholder types
Interviews
Performed
Total
Contacted
CSOs 14 22
International, EU and national authorities 16 40
Law firms 5 10
Professional consultancies 9 34
Think tanks & academic/research
institutions 7 25
Trade & business associations 10 14
Trade unions & professional associations 1 1
Total 62 146
246
These letters and position papers were for instance received from the European Broadcasting Union (EBU), Transparency
International EU, European Civic Forum (ECF; along with 230 civil society organisations), Civil Society Europe (CSE,
along with 12 civil society organisations), European Partnership for Democracy (EPD, along with 47 civil society
organisations), and Philea.
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1. The think tanks / research institutes / CSOs interviewed cover both: i) organisations that conduct advocacy activities and
are experts in lobbying transparency / foreign interference; and ii) organisations that are purely included as they conduct
advocacy activities.
2. The stakeholders interviewed from trade / business / professional associations, in many cases, also represented specific
public affairs / public relations consultancies.
7. Flash Eurobarometer on Citizenship and Democracy (Flash EB 528)
Flash Eurobarometer 528 on Citizenship and Democracy, indicates considerable popular
support for several initiatives of the Defence of democracy package. In the following, a brief
overview is provided with respect to the findings relevant for the contents of the package.
7.1. On more transparency in interest representation services
About 8 in 10 respondents (81%) agree that foreign interference in our democratic system is a
serious problem that should be addressed, and over 7 in 10 (74%) agree that such interference
can affect citizens’ voting behaviour. Views are somewhat more divided on the question of
whether foreign countries are justified in aiming to influence EU election outcomes to defend
their interests: 42% agree that they are justified, while 55% disagree.
Still, there is strong majority support for tackling such covert interference in our democratic
systems. About 8 in 10 respondents (81%) agree that entities representing foreign governments
should be registered to prevent the problem.
The proportion agreeing that foreign interference in our democratic system is a serious problem
holds at over 8 in 10 in all Member States with the exception of the Scandinavian countries,
and Hungary and Romania, where it ranges from 69% (in Finland) to 75% (in Sweden). The
proportion agreeing that foreign interference can affect citizens’ voting behaviour similarly
holds at a majority level in all countries and, indeed, is notably higher than average in Slovakia
(80%), Croatia (82%), Slovenia (83%), Sweden (83%) Cyprus (84%) and Czechia (85%).
8. Flash Eurobarometer on Democracy, 2023 (Flash EB 522)
Flash Eurobarometer 522 on Democracy, indicates considerable popular support for several
initiatives of the Defence of Democracy package. In the following section, a brief overview is
provided with respect to the relevant findings for the contents of the package.
8.1. Overall findings
When asked about their degree of satisfaction with the way democracy works in their country,
close to half of respondents reply being ‘very satisfied’ (10%) or ‘somewhat satisfied’ (37%),
in contrast to about1 in 2 respondents who reply they are ‘not very satisfied’ (31%) or ‘not at
all satisfied’ (20%). A handful of respondents (2%) answer that they ‘don’t know’.
Respondents were asked which institutions or actors they have confidence to defending
democracy in their country. The largest share reply that they have confidence in citizens to
defend democracy in their country (9% ‘very confident’and 45% ‘somewhat confident’). More
than half of respondents show confidence in EU institutions, including the European Court of
Justice (15% ‘very confident’ and 39% ‘somewhat confident’), followed by about half of
respondents who trust CSOs to defend democracy (9% ‘very confident’ and 44% ‘somewhat
confident’).
Smaller shares of respondents have confidence in national courts (49%), electoral authorities
(48%), public administration (46%), in their national (and local) government (44%), in their
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national (and local) parliament (42%) or in the media (38%). Finally, about 3 in 10 respondents
(29%) put confidence in political parties and politicians to defend democracy in their country.
8.2. On more transparency in interest representation services
Respondents were presented with a list of 10 items that may constitute a serious threat to
democracy in their country. They were asked to select up to 3 threats. The threat to democracy
listed most frequently by respondents is ‘false and/or misleading information in general
circulating online and offline’ (38%); this is followed by ‘growing distrust and scepticism
towards democratic institutions’ (32%).
Another 4 of the threats are selected by more than1 in 5 respondents: ‘lack of engagement and
interest in politics and elections among regular citizens’ (26%), ‘lack of opportunities for
citizens to voice their opinions’ (23%), ‘propaganda and false/misleading information from a
non-democratic foreign source’(22%), ‘covert foreign interference in the politics and economy
of your country, including through financing of domestic actors’ (21%).
In 22 countries, respondents are most likely to reply that one of the most serious threats to
democracy in their country is ‘false and/or misleading information in general circulating online
and offline’. The proportion selecting this threat varies between 24% in Bulgaria and 48% in
Hungary and Malta.
8.3. On electoral resilience
Respondents were presented with a list of 6 elements associated with free, fair and resilient
elections, and they were asked which elements they consider the most important to define free,
fair and resilient elections (they could select up to 3 elements).
About 1 in 2 respondents (51%) select ‘voters having access to accurate information to make
an informed choice’ as one of the most important elements of free, fair and resilient elections,
followed by 47% selecting ‘the electoral administration being independent and impartial’.
Respondents were also presented with a list of 6 elements associated with free, fair and resilient
election campaigns, and they were asked which elements they consider the most important to
define such campaigns (up to 3 elements could be selected).
The largest shares of respondents select ‘debates and campaigns avoiding hate speech,
manipulation and lies’ (46%) and ‘candidates and political parties having equal opportunity to
access the media’ (41%). Each time about a third of respondents refer to ‘voters know who
finances candidates and political parties’ (35%), ‘voters can engage with candidates and
political parties in debate’ (33%) and ‘voters know who finances political advertising and
sponsored content and can distinguish between sponsored content and non-paid for political
information’ (32%) as important elements of free, fair and resilient electoral campaigns.
9. Additional meetings with stakeholders
On 6 July 2023 a meeting took place at political level with Civil Society Organisations
representatives to discuss the ‘Defence of Democracy’Package in the context of the preparation
of an impact assessment and broader consultations.
CSOs highlighted the importance of the continued engagement with civil society and the
importance on conducting a thorough IAs in preparation of the proposal. They welcomed the
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inclusion of strong safeguards, further enquired about the scope and the organisations possibly
captured by the instrument.
CSOs flagged the possible risks and issues: the risk to fail to capture the issue as a whole and
fall short foreign funded interest representations happening internally to the EU; the risk that
other undemocratic regimes would use EU action as a pretext for acting with wrong intentions;
possible misuse of the data captured by the envisaged registries; the issue for organisations
advocating in repressive regimes for which globally it was difficult to get support and
resources.
10. Additional questionnaires
Lastly, the Commission sent out additional questionnaires on potential policy options to
Member States authorities, commercial entities and CSOs on 4 August 2023 with a deadline
for contribution on 25 September 2023.
The Commission has received 29 replies: 11 replies from CSOs, 15 replies from Member
States, and 3 replies from organisations representing the interest representation industry.
10.1. Replies from CSOs
Scope of the transparency measures
Some respondent CSOs took a stance on the issue of the nature of the instrument to be
considered in the intervention with 4 out of 11 CSOs considering that the intervention should
take the form of a Regulation, 1 of which expressing that a Directive could be misused by
Member State. 5 CSOs noted that a Recommendation could encourage Member States to adopt
transparency rules, but that it would not be sufficient to solve the issues at hand.
9 CSOs expressed a view that the legislative intervention should cover all types of interest
representation activities and not be limited to those carried out on behalf of third countries.
2 CSOs highlighted that focusing on third countries is not sufficient and interferences from EU
Member States into CSOs activities should also be covered.
3 CSOs raised the issue of the risk of circumvention through private entities.
3 respondents expressed the need to provide a clear definition of the notion of interest
representation.
Registration and transparency requirements
The majority of CSOs expressed that all entities should provide information on the Member
States of registration, the Member States where the interest representation takes place, clear
information on the actors involved, and clear information on the legislation, policy or initiative
of interest.
3 respondent CSOs emphasized the need of balancing the right of access to information with
the right to privacy data and personal data.
Most CSOs highlighted the need to assess coherence with other measures, with 3 responses
emphasising the EU Transparency Register as a reference point. Some of them expressed that,
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when it comes to CSOs, registration and disclosure requirements existing at EU and, overall,
at national level already provide an adequate framework to increase transparency, with 4
respondents indicating that undertaking a comprehensive comparative analysis of existing
requirements is necessary.1 respondent in particular underlined the need for registration
requirements not to hinder the freedom of association.
All but 3 respondent CSOs put an emphasis on the issue of avoiding stigmatisation, explaining
that registration should not lead to stigmatisation but to normalisation of interest representation,
as legitimacy of interest representation does not depend on whose interest is being represented,
but on the ethical standards that are applied when carrying out interest representation activities.
The majority of CSOs indicated that a prior authorisation/licence system would risk amounting,
in particular if applied to CSOs, to a disproportionate interference on the right to public
participation. – 5 of which indicating that such a system would run afoul of international and
EU human rights law. However, 1 respondent indicated that it would be useful to create such
a requirement, while 3 others did not answer or address the questions related to prior
authorisation/licensing.
4 CSOs expressed that it would be disproportionate to create a general requirement to disclose
a registration number before meeting EU or Member States officials.
On the information which should be made publicly available in national registers to ensure
accountability, 1 contribution suggested to make publicly available an annual budget (income
and expenditure) and an annual activity report.
1 CSO proposed that the registration mechanism be user-friendly and easily accessible to
anyone, including people with disabilities.
Derogations and safeguards
Most CSOs were of the opinion that entities involved in interest representation activities aiming
to influence policy-making should not be exempt from requirement to register. CSOs
highlighted that the Commission should put in place safeguards including on the language,
enforcement and democratic impact.
4 CSOs highlighted the need to create a minimum threshold for certain types of entities in order
to avoid that all CSOs would fall under the obligation to register.
2 respondent CSOs expressed that there should be no exemption for CSOs from the scope of
the initiative, while 2 other respondents expressed on the contrary that they should benefit from
an exemption (the first exemption proposed was to exclude youth organisations, while the other
concerned entities known to bona fide pursue public interest).
1 respondent underlined the need to avoid creating a system of double registration: in one
register for interest representation activities in general and in another one for when they are
carried out on behalf of third countries.
4 respondents expressed that requirements should rely on a strict risk-based approach in order
to avoid discriminatory practices.
2 respondents expressed that there should be no white list or black list of third countries,1 of
which stressing that it should especially not be left to Member States to draw up such lists as
83
countries would risk being excluded or included based on political or economic ties with that
Member State, thereby creating circumvention risks. However, 1 respondent expressed that as
part of a risk-based approach there should still be a distinction between democratic and non-
democratic countries.
1 respondent highlighted that principles of transparency and accountability inherent to the right
to good administration should be taken into account, and 3 respondents specifically referred to
the need to ensure safeguards required by the right to an effective remedy and to a fair trial.
Monitoring and sanctions
7 CSOs welcomed the establishment of an independent oversight body to ensure that the
transparency register is regularly and properly monitored. 1 of them suggested that there should
be cooperation with the Transparency Register Secretariat managed by the Commission.
2 respondents also suggested that the Commission could facilitate an exchange at EU level
among existing supervisory authorities, and provide recommendations as to their
independence, fairness, and effectiveness. Only 1 respondent expressed that an EU-level
governance mechanism would not be useful.
2 respondents expressed that proportionate administrative sanctions are the most appropriate
option to deter misconduct and that a fully harmonised sanction regime should be created at
EU level, 1 of which highlighting that a full harmonisation of the enforcement and sanctions is
essential to avoid adverse consequences and misuse by Member States. On the contrary, 1
respondent expressed that the Commission should not propose any sanctions regime before
having conducted a comprehensive comparative analysis of existing sanctions regimes in
Member States.
10.2. Replies from Member States
5 out of 15 Member States expressed the view that it is necessary to put in place harmonised
measures enhancing the transparency of interest representation activities seeking to influence
decision-making processes. 1 Member State however expressed concern that a regulation that
has the effect of a “foreign agent law” or can be understood as such, could cause negative
consequences.
5 Member States expressed some reservations as to whether harmonisation at EU level would
be the best option.
3 Member States suggested to opt for the first proposed policy option – a non-legislative
solution promoting common standards. Transparency recommendations resulting in a
combination of various non-legislative solutions promoting common standards would allow
Member States to evaluate their current sets of measures and to introduce where necessary
additional tailored improvements.
On a potential obligation to obtain prior authorisation/license at EU level to carry out interest
representation activities on behalf of third countries, 1 Member State expressed that a prior
authorisation scheme does not appear to be the most proportionate solution for achieving the
objective pursued, and suggested that a transparency regime based on a reporting regime,
coupled with the application of ethical obligations, would appear more appropriate.
Scope of the transparency measures
84
1 Member State highlighted that complicating the exchange between lobbyists and policy-
makers, could discourage interest representations from participating in the political decision-
making process. It added that it could therefore negatively impact the participation of civil
society.
Member States broadly agreed that society has a fundamental interest to be informed about
interest representation activities carried out on behalf of third countries.
1 Member State expressed concerns about specifying at EU level whether and which contacts
at the national level are permissible, or whether and to what extent contacts of national
parliamentarians or government representatives have to be published.
1 Member State expressed concerns about the measures to introduce binding rules for national
transparency registers. It stated that deciding on the degree of transparency for national
processes falls within the competence of the Member States.
6 Member States argued that it would be desirable to transparently handle all types of interest
representation activities that attempt to influence the formulation or implementation of policies,
legislation or public decision-making processes in the EU, and not to focus only on the cases
where such activities are carried out on behalf of third countries.
1 Member State expressed that in addition to further national initiatives to promote
transparency, measures developed on an EU wide basis would play a crucial role in fostering
accountability and trust.
1 Member State expressed that harmonisation of all the measures governing interest
representation in the Member States would go far beyond the purpose of the Commission’s
initiative and would be difficult to achieve at least in the short term. This Member State added
that the establishment of a general regime covering interest representation activities for the
benefit of strictly private actors and activities for the benefit of third countries might not be
sufficient to effectively regulate the latter type of activity.
1 Member State emphasized that the influence measures which deserve particular attention,
and which must therefore be covered as a matter of priority are those involving elected
representatives, former elected representatives and certain public officials; with a view to
influencing public life. 1 other Member State expressed it was in favour of an obligation for
public officials to also provide information on their meetings with entities carrying out interest
representation activities.
1 Member State warned that too extensive regulation has its risks from the point of view of
democratic values and the rule of law.
1 Member State suggested that new forms of lobbying, such as digital lobbying and lobbying
using artificial intelligence should also be covered.
Registration and transparency requirements
7 Member States stated that information on the names and owners of entities should be
disclosed, 6 of which stating that the name of the countries from which fundings are received.
1 Member State specified that publication could cover data relating to the identity of the natural
person or, in the case of a legal person, its directors, the nature of influence actions carried out,
as well as, where applicable, the amount of expenditure incurred in respect of those actions,
85
specifying the foreign power of foreign political organisation for the benefit of which they are
carried out.
1 Member State expressed that publication should cover, when talking about natural persons,
their nationality, all citizenships they have or have had in the past, business relations with third-
country entities, natural and legal persons. When it comes to legal entities, information about
the country of registration, its history of changes, implemented projects, partners linked by
cooperation ties.
5 Member States expressed that the interlocutors of the meetings with public officials and the
numbers of meetings be disclosed. 3 Member States expressed that the topics of discussions
and purpose of the activities be disclosed as well. 2 Member States stated that the time and
place of the activities should be registered as well.
Member States largely agreed on the need to follow the GDPR principles when publishing
personal data.
1 Member State expressed that registration requirements could be analogous to those for
lobbyists registration, where such laws exist. In addition, information on connections, affiliated
entities, etc, would be required. The information submitted should be crossed checked using
specialized tools and databases developed and maintained by Member States.
4 Member States expressed that they were in favour of a prior authorisation/licensing system,
while 6 explained that they were against such a system.
1 Member State wrote that it was in favour of an obligation for entities carrying out interest
representation activities to provide their registration number before meeting decision-makers.
Derogations and safeguards
1 Member State highlighted that its legislation contains exemptions of the obligation to register.
1 Member State expressed that certain exemptions could be necessary; however, overly
generous exemptions could dilute the purpose of the registration requirements. That Member
State emphasized that measures addressing interest representation could have an impact on
diplomatic relations with third countries. It would be therefore important to provide for some
exceptions also at EU level, as otherwise international exchange would be restricted, and could
lead to a chilling effect.
1 Member State considered that the exclusion of civil society organisations and SMEs as a
matter of principle does not seem desirable, since these entities could serve as any other conduit
for influence activities carried out on behalf of foreign powers.
2 Member States highlighted that the legislative proposal must be designed with due regard for
fundamental rights. Moreover, the principles of legality, necessity and proportionality must
therefore be fully respected.
1 Member State expressed that there should not be any specific exemptions.
4 Member States stated that SMEs should not benefit from specific derogations. 1 of those
Member States however distinguished for CSOs, stating that for them a general derogations
86
could apply with regard to protection of fundamental rights, exercise of constitutional rights
and sensitive personal data protection.
2 Member State wrote that activities directed at safeguarding or representing the interests of a
party or participant in connection with an administrative or judicial procedure should be
exempt.
3 Member States explained that diplomatic actors and activities should not be covered.
1 Member State raised the issue that the adoption of a legislative instrument might lead to risks
of stigmatisation for certain entities.
2 Member States proposed a system whereby one part of the register can only be accessed by
authorities.
Monitoring and sanctions
1 Member State warned that setting up a sanctions regime that restricts activities of actors from
third countries in the EU may lead some of these countries to establish reciprocal rules, and
this could restrict the work of local civil society organisations in third countries which have so
far been supported through European development cooperation and whose active role is very
important.
1 Member State expressed that supervisory authorities entrusted with monitoring would not
necessarily have to be “completely independent”, but they may also be located in a ministry,
and be removed from an undue influence by decision-makers by other measures.
On the obligation to obtain prior authorisation/license at EU level to carry out lobbying
activities on behalf of third countries, 1 Member State expressed that a prior authorization
scheme does not appear to be the most proportionate solution for achieving the objective
pursued, and suggested that a transparency regime based on a reporting regime, coupled with
the application of ethical obligations, would appear more appropriate.
1 Member State emphasized that Member States should have autonomy in designating the
competent authority for their national register.
2 Member States highlighted that sanction regimes must leave the Member States a wide
margin of discretion.
4 Member States advocated for a sanctions regime defined at Member State level, 2 of which
mentioning the possibility to establish guidelines to ensure enforcement consistency.
7 Member States expressed that supervisory authorities should be permitted to ask specific
information from registered entities, subject to safeguards.
1 Member State expressed that the implementation of monitoring should be entrusted to the
institutions responsible for the regulation of lobbying activities and compliance with national
security interests.
1 Member State suggested that a network of authorities could serve as a platform for regular
exchanges of information and structured cooperation.
87
3 Member States expressed that non-penal/administrative sanctions should also be considered,
varying in accordance with the gravity of the misconduct.
10.3. Replies from organisations representing interest industry
Scope of the transparency requirements
1 out of 3 industry representatives explained that establishing harmonized measures to enhance
transparency in interest representation activities conducted on behalf of third countries at EU
level is necessary. According to that respondent to define which specific third countries should
fall under such measures, it suggests employing a set of criteria: the geopolitical significance
of a country, and security and strategic interests.
1 respondent expressed that, at present, commercial interest representation activities carried
out on behalf of third countries and seeking to influence the formulation or implementation of
policy or legislation or public decision-making processes in the EU are transparent. Another
respondent expressed a similar opinion, that its member organisations are also complying with
applicable regulatory frameworks.
2 respondents recommended the Commission to take into consideration all forms of interest
representation activities and not to harmonise only those performed on behalf of third countries.
1 industry representative highlighted the importance to discern between the public and private
sector of the public authorities, the transparency in the exercise of the activity, whether they
are elected or named, there must be some limits that allow the necessary confidentiality derived
from the protection of privacy.
All 3 industry representatives considered that no specific entity should benefit from exemptions
for the scope of transparency requirements, in order to avoid risks of circumvention.
2 respondents expressed that transparency requirements should not lead to stigmatisation such
as ‘organisations supported from abroad’ or lead to the creation of ‘special foreign influence
register’.
1 respondent expressed that it is in favour of a harmonised transparency register at EU level,
and cautions against the risks associated with the creation of a parallel registration system for
interest representation activities carried out on behalf of third countries.
1 respondent underlined the challenge of balancing transparency with the need for
confidentiality in certain diplomatic matters.
Registration and transparency requirements
All 3 industry representatives favour registration and transparency requirements to be
harmonised at EU level but are not in favour of a licensing/prior authorisation mechanism,
although 1 expressed it would be in favour of a mandatory registration system.
All 3 industries are in favour of an obligation to provide a registration number before being
able to meet public officials. 1 respondent underlined that it would be essential to implement
this requirement in a practical and user-friendly manner.
1 industry representative stated that any new harmonised system should base itself on the EU
Transparency Register as a model.
88
1 respondent considered that potential registration requirements could include mandatory
registration.
Derogations and safeguards
All 3 industry representatives are not in favour of any specific exemptions for certain entities
or of any de minimis threshold.
1 respondent considered that safeguards should encompass a range of measures, including
rigorous monitoring and auditing of interest representation activities to verify compliance with
transparency requirements, and that regular compliance reviews should be conducted.
Monitoring and sanctions
1 industry representative considered that the Register must be independently considered from
a functional and administrative point of view and must depend on an independent body.
All 3 industry representatives expressed that they are in favour of providing supervisory
authorities with powers to request additional information from registered entities about the
nature of their activities or the veracity of the information in the register (although 1 was not
in favour of allowing information requests about contracts above certain thresholds).
1 respondent expressed that it is in favour of administrative sanctions and suggested that
sanctions to deter misconduct could include the possibility to be banned from registers and to
have their names published. Repetitive misconduct should be taken into account as a criteria in
assessing the type and level of sanctions to be applied. Another respondent similarly expressed
that a registration ban is an appropriate sanction mechanism. 1 other respondent stated that
restricting sanctions to limited administrative measures may be a reasonable approach.
Another respondent underlined that the obligations imposed in the register cannot be enforced
without an adequate framework for defining violations and the corresponding penalties for non-
compliance.
1 industry representative emphasized the need to appropriately enforce currently existing
transparency regimes before considering the creation of new or enhanced transparency and
registration requirements.
1 industry representative highlighted the important of the right to due process and the rights of
defendants against accusations of bad behaviour, with the possibility of having access to an
independent judicial authority to provide redress.
89
Annex 3: Who is affected and how?
This annex provides in-depth information and estimated cost figures on the stakeholders
affected by the initiative. All figures were gathered through the supporting study.
1. Practical implications of the initiative
The following table presents a description of the categories of stakeholders considered by the
initiative, with a summary analysis of how they will be affected by the proposed measures.
Categories
of
stakeholders
Description of the
stakeholders
Measures affecting the stakeholders
Commercial
entities
For example, public
relations firms and
consultancies, public
affairs firms and
consultancies, legal
services firms, private
companies, and any
kinds of interest
representation services
providers, so long as
they carry out interest
representation services
activities on behalf of
third countries.
Due to the Article 114 TFEU legal basis of the
intervention, the proposed measures would not
differentiate commercial and non-commercial
entities in their application.
Record-keeping: Entities would be required to
keep, for a reasonable period, information
such as the identity of the entity on whose
behalf the activity is carried out, a description
of the purpose of the interest representation
activity.
Registration: Entities would be required to
register in a national public register and
provide information on themselves, the
activities conducted, and the entities they
conduct the activities on behalf of (e.g.
regarding the entity, the activity and the entity
on whose behalf the activity is carried out).
This information would need to be updated
regularly.
Transparency:
• Entities carrying out interest
representation as well as their
subcontractors would have to provide
their registration number when in direct
contact with public officials.
• Member State would be required to
ensure that publicly available national
registers are in place and that they cover
the information and reporting
requirements included in the intervention.
They would need to designate or set up
supervisory authorities ensuring proper
implementation. They would need to
Non-
commercial
entities
For example, civil
society organisations,
trade and business
associations, trade
unions and
professional
associations, think
tanks and research
institutions, academic
institutions, advocacy
groups, charities, so
long as they carry out
interest representation
activities on behalf of
third countries.
90
publish an annual report based on the data
entered in the register.
• Interest representation service providers
would have the possibility to take
measures to identify the recipients of the
services.
Member
States
Member State
authorities in charge of
administering,
managing, supervising,
enforcing or
sanctioning the
application of the
proposed transparency
and registration
requirements set forth
in the initiative.
Member States would have to establish new
authorities or task existing authorities to
administer, manage, supervise, enforce or
sanction the application of the proposed
transparency and registration requirements set
forth in the initiative.
Member State authorities would have to
establish new or adapt existing registers on the
transparency of interest representation
activities.
They would have to administer and monitor
the use of these register.
They would have to participate in a
governance mechanism at EU level, and
exchange information with other Member
States authorities in the context of the
administrative cooperation needed to
supervise and enforce the requirements set
forth in the initiative.
They would have to enforce and adopt
sanctions against entities which would not
respect the requirements set forth in the
initiative.
2. Who is affected?
This section presents an estimated size of the internal market for interest representation
activities carried out on behalf of third countries and entities affected by the preferred policy
option. Information on the methodology used for this estimation is provided in Annex 4.
Estimates of the number of entities carrying out interest representation activities on
behalf of third countries by scenario, EU-27
Country Total entities
carrying out
interest
representation
activities on
Entities carrying out interest representation activities on
behalf of third countries – estimates by scenario
Low scenario
(0.02%)
Middle scenario
(0.025%)
High scenario
(0.03%)
91
behalf of third
countries
Austria 118,286 24 30 35
Belgium 117,446 23 29 35
Bulgaria 14,187 3 4 4
Croatia 28,294 6 7 8
Cyprus 6,548 1 2 2
Czechia 96,049 19 24 29
Denmark 101,445 20 25 30
Estonia 23,781 5 6 7
Finland 109,465 22 27 33
France 1,298,857 260 325 390
Germany 628,972 126 157 189
Greece 6,794 1 2 2
Hungary 63,907 13 16 19
Ireland 33,823 7 8 10
Italy 369,791 74 92 111
Latvia 11,905 2 3 4
Lithuania 14,813 3 4 4
Luxembourg 8,695 2 2 3
Malta 2,928 1 1 1
Netherlands 48,454 10 12 15
Poland 74,177 15 19 22
Portugal 68,765 14 17 21
Romania 61,698 12 15 19
Slovakia 20,198 4 5 6
Slovenia 26,731 5 7 8
Spain 101,562 20 25 30
Sweden 103,267 21 26 31
EU-27 3,560,838 712 890 1,068
3. Costs and benefits
3.1. Costs to Member State authorities
Costs to Member State authorities over a 10-year time horizon can be summarised as follows.
Information on the methodology used for this estimation is provided in Annex 4.
Summary of total costs to Member State authorities (over 10-years)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Familiarisation costs 1,533.06 3,066.11 4,599.17
Ensuring an appropriate
register is in place
Not possible to ascertain EU-wide costs based on the
available data.
IT tool maintenance (15
Member States with existing IT
tools)
Costs are considered to be business as usual (BaU)
costs.
92
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
IT tool maintenance (12
Member States without existing
IT tools)
540,000.00 2,160,000.00 4,860,000.00
Implementing appropriate
management, monitoring and
enforcement mechanisms
5,654,945.59 7,068,681.99 8,482,418.39
Total: 6,196,478.65 9,231,748.10 13,347,017.56
3.2. Costs for entities carrying out interest representation activities on behalf of
third countries
In total, under the preferred policy option, the estimated costs to entities carrying out interest
representation activities on behalf of third countries yearly and over a 10-year horizon can be
summarised as follows. Information on the methodology used for this estimation is provided
in Annex 4.
Estimated average costs per entity, per size class
Micro /
Small
(97.3%)
Medium
(2%)
Large
(0.7%)
General average
costs across all
entities
Average total costs per
entity
828.49 1,656.97 3,313.94 862.45
Estimated total costs to interest representation entities within scope (over 10-years)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Basic familiarisation
costs
71,165,916.06 142,338,950.84 213,519,104.36
Extended familiarisation
costs
56,949.82 142,374.54 256,274.18
Registration and
information disclosure
costs
6,142,119.10 7,677,648.90 9,213,178.70
Record-keeping costs Business as usual (BaU) – No incremental costs
Other costs (incl. admin
sanctions, registration
fees)
No total cost estimates possible due to lack of evidence on
possible frequency and actual scale of fines.
Total: 77,364,984.98 150,158,974.28 222,988,557.24
4. Summary of costs and benefits
I. Overview of Benefits (total for all provisions) – Preferred Option
Description Amount Comments
Direct benefits
Benefits for Member
State authorities.
Economic benefits: Benefits are provided in a qualitative
way, not in a quantitative way.
93
• Increased knowledge and
understanding of the market for
interest representation activities
carried out on behalf of third
countries due to increased
transparency.
Social benefits:
• Increased knowledge of the
magnitude, trends and actors of
interest representation activities
carried out on behalf of third
countries.
• The establishment of a governance
structure at EU level facilitates
cooperation between Member
States and improve coordination in
addressing certain problems related
to interest representation.
Benefits for private
entities.
Economic benefits:
• Create a level playing field and
enhance legal certainty for interest
representation activities carried out
on behalf of third countries;
• Facilitate service provision across
multiple Member States as only 1
registration would be necessary;
• Help normalising, legitimising and
destigmatising interest
representation via an enhanced level
of transparency and trust in the
sector.
Benefits are provided in a qualitative
way, not in a quantitative way.
Benefits for society at
large.
Social benefits:
• enable citizens and public officials
to easily recognise influence
campaigns by third countries
thereby contributing to the integrity
of, and public trust in, EU and
Member State decision-making
processes
• support scrutiny from interested
actors (including CSOs, political
actors, researchers, elections
observes or journalist) to monitor
interest representation activities
carried out on behalf of third
countries.
• The strengthening of the quality of
information available would help
enrich the political debate
Benefits are provided in a qualitative
way, not in a quantitative way.
Indirect benefits
n/a n/a n/a
94
Administrative cost savings related to the ‘one in, one out’ approach*
Recurrent
(direct/indirect)
n/a n/a
One-off n/a n/a
II. Overview of costs – Preferred option
Citizens/Consumers Businesses Administrations
One-off Recurrent One-off Recurrent One-off Recurrent
Preferre
d policy
option
Direct
adjustment
costs
n/a n/a
EUR 71.2
million to
EUR 213.8
basic
familiarisati
on costs
EUR 57,000
to EUR
256,000
extended
familiarisati
on costs
n/a
EUR 1,500
– 4,600
familiarisati
on costs for
national
authorities
EUR
60,000 to
EUR
540,000
maintenan
ce costs
(12 MS
authorities
without
existing IT
tools)
Business-
as-usual
costs (15
MS with
existing IT
tools)
Direct
administrative
costs
n/a n/a n/a
EUR
615,000 to
EUR
921,000
registratio
n and
informatio
n
disclosure
costs per
year
n/a n/a
Direct
regulatory fees
and charges
n/a n/a n/a n/a n/a n/a
Direct
enforcement
costs
n/a n/a n/a n/a n/a
EUR
565,000 to
EUR
848,000
95
Indirect costs n/a n/a n/a n/a n/a n/a
Costs related to the ‘one in, one out’ approach
Total
Direct and
indirect
adjustment
costs
n/a n/a EUR 71.2
million to
EUR 213.8
million total
familiarisati
on costs
n/a
Administrative
costs (for
offsetting)
n/a n/a n/a EUR
615,000 to
EUR
921,000
registratio
n and
informatio
n
disclosure
costs
(average
EUR
768,000)
III. Overview of relevant Sustainable Development Goals – Preferred option
Relevant SDG Expected progress towards the Goal Comments
SDG no. 16 – Promote
peaceful and inclusive
societies for sustainable
development, access to
justice for all and build
effective, accountable
and inclusive
institutions at all levels
The initiative aims to enhance the
integrity of, and public trust in, EU and
Member State democratic institutions,
including through increased transparency
in interest representation activities
carried out on behalf of third countries
and through measures promoting
inclusiveness, accessibility, transparency
and security of electoral and decision-
making processes.
In particular, this initiative will
contribute to the following SDG
16 sub-goals:
• 16.6: Develop effective,
accountable and transparent
institutions;
• 16.7: Ensure responsive,
inclusive and representative
decision-making; and
• 16.10: Ensure public access to
information and protect
fundamental freedoms.
96
Annex 4: Analytical methods
1. Analytical framework
The impact assessment is prepared on the basis of a supporting study, a Public Consultation, a
Call for Evidence, 2 Flash Eurobarometers, a series of stakeholders focus group meetings,
targeted questionnaires circulated to civil society organisations, Member States and sector of
the industry concerned, intensive direct stakeholder consultations as well as relevant literature
and recent EU publications (reports, studies and policy documents). It includes a full analysis
of the baseline, include:
• The relevant legal frameworks and anticipated evolutions, at both EU and national
level, including a qualitative description of gaps, overlaps, commonalities and conflicts.
• A summary of the scope and context for the impact assessment is provided in the
annexes, including a market analysis drawn from the supporting study and case studies
to illustrate the various processes involved and to highlight where difficulties lie.
The objectives, options and assessment of their various impacts were prepared on this basis.
Quantitative data on the specific market for interest representation activities carried out on
behalf of third countries was investigated although the inherent nature of such activities
rendered that effort challenging.
2. Main definitions and actors concerned
For the purposes of the overall impact assessment, the following definition was used for the
term “interest representation”: “Interest representation means an activity conducted with the
objective of influencing the development, formulation or implementation of policy or
legislation, or public decision-making processes in the Union.”. The term “third country”
refers to countries outside of the European Economic Area (EEA). The term “foreign
influence” was defined as follows: “Intervention by third country governments to influence the
democratic sphere including legislation and policies, also by shaping public opinion in a way
which benefits their interests”. On the other hand, “Foreign interference is used to differentiate
between influencing activities that are integral to diplomatic relations and activities that are
carried out by, or on behalf of, a foreign state-level actor, which are coercive, covert,
deceptive, or corrupting and are contrary to the sovereignty, values, and interests of the
Union.”
This approach to these definitions reflects a broad understanding of the issue of interest
representation activities carried out on behalf of third countries. This approach was adopted in
order to ensure that the issues at hand be tackled in the most comprehensive way possible. As
such, the establishment of these definitions drew on definitions of existing or related notions
at both EU and Member State levels, mapped through extensive consultations as well as a
dedicated supporting study. These definitions ensure an objective and proportionate approach
to the issues and actors and activities concerned by the intervention.
The activities covered by the intervention are any interest representation activities conducted
with the objective of influencing the development, formulation or implementation of policy or
legislation, or public decision-making processes on behalf of a third country in the EU,
regardless of the entity which performs them. In line with the Article 114 TFEU legal basis,
such activities would be covered by the intervention only when they are normally provided for
remuneration. The analyses, mappings and consultations found that the main actors concerned
97
by this intervention will be both commercial entities (e.g. consulting firms, law firms,
individual businesses) and non-commercial entities (e.g. think tanks, education, research and
academic institutions, business, trade or professional associations, or CSOs).
The section below presents key stakeholder groups that fall under current regulatory
obligations, as well as an estimated size of the internal market for interest representation
activities, an estimation of the market for interest representation activities carried out on behalf
of third countries specifically, and key stakeholder groups that will be affected by the Policy
Options.
2.1. Key stakeholder groups that fall under the main existing regulatory obligations
Where possible, stakeholders are distinguished between for-profit organisations and non-profit
organisations. Indeed, evidence shows that 1) commercial entities, mainly consulting
companies and law firms providing remunerated public / regulatory affairs / relations or
communication services, and 2) non-profit organisations (CSOs), e.g. NGOs, think tanks,
stand-alone research centres and those tied to higher education establishments, have been used
to carryout interest representation activities on behalf of third countries.
The review of type of registrants to the EU Transparency register and to and a selection of
national registers has allowed us to complement the identification of key stakeholders.
• The (self) categorisation of registrants in the EU Transparency Register (5 February
2023 data) presented below shows that 28% are non-governmental organisations,
platforms and networks and similar (3,506), 25% are companies & groups (3,083) and
21% are trade and business associations (2,655). Interestingly, 2 entities, respectively
from Norway and the Channel Islands, are categorised as “Entities, offices or networks
established by third countries”.
• Based on publicly available data outlined below, across the 10 Member States for which
data is available, a total of 12,199 organisations and individuals are registered in
national lobbying or transparency registers to conduct lobbying activities, with
Germany, France and Ireland comprising a significant proportion (88%) of the total
registrants across these 9 countries247
. It is noted that this geographical concentration
mirrors the stringency of regulatory requirements, which are high in those countries.
With regard to the types of entities represented, and based on an incomplete dataset
across 4 of the 9 Member States, the table shows that business associations (4,692
registrants) followed by advocacy organisations / charities (873 registrants) and
research firms / consultancies (465 registrants) represent the highest number of entries
in national lobbyists / transparency registers in the EU.
Categorisation of registrants in the EU Transparency Register (5 February 2023 data)
Category of registration Total
Non-governmental organisations, platforms and networks and
similar
3,506
Companies & groups 3,083
Trade and business associations 2,655
Trade unions and professional associations 982
247
DE (5,676 registrants), FR (2,604 registrants) and IE (2,454 registrants) are the countries with the most registrants; they
also comprise a significant proportion (88%) of the total registrants across these 9 countries.
98
Think tanks and research institutions 568
Professional consultancies 549
Other organisations, public or mixed entities 455
Academic institutions 309
Associations and networks of public authorities 154
Self-employed individuals 144
Law firms 85
Organisations representing churches and religious communities 48
Entities, offices or networks established by third countries 2
Total 12,540
National transparency registers: Available data on number of entities registered, by
entity type
MS
Media
firms
Production
of
culture
companies
Financial
institutions
/
Services
Legal
services
Public
relations
Advocacy
/
Charity
Research,
education
and
academia
Religious
orgs
Business
associations
Representative
body
Research
firms
and
consultants
Other
/
n/a
Total
AT 385 385
BE 175 175
DE 41 32(1)
104 10 3,027 295 2,167 5,676
FR 26 525(2)
7 1,341(3)
155 550 2,604
IE 24 21 158 34 107 303 73 15 278(4)
228 1,213 2,454
IT 13(5)
6 1 46(6)
15 3 84
LT 303 303
LU 183 183
RO 253 253
SI 82 82
Total 24 21 158 101 107 873 190 26 4,692 228 465 5,314 12,199
(1)
Includes organisation under public law (e.g. corporations, institutions and foundations under public law).
(2)
Encompasses associations and foundations – associations could be representing any kind of interest.
(3)
Encompasses companies and professional organisations.
(4)
Includes Agribusiness, Aerospace, Construction, Defence, Retail Telecommunications, Transport.
(5)
Includes NGOs.
(6)
Includes Companies and groups, Trade and trade association, Trade unions and professional associations.
2.2. The internal market for the provision of interest representation activities
Based on available data, the sub-sections below provide a selection of affected entities in EU27:
1) enterprises that deliver public relations and communication activities, 2) think tanks and 3)
CSOs. Data notably shows that most of those entities are found in France, Belgium, Germany,
Italy and Sweden, i.e. suggesting that those countries would most likely be most affected by
the preferred policy option.
Data and method limitations
99
The first caveat is that within each category of stakeholders that delivers interest
representation and/or political services or activities, the sub-category that does so for
governments and state-linked entities / individuals specifically is unknown. Moreover:
(1) NACE code M70.21 of the Eurostat’s Structural Business Statistics
(SBS) provides data on the number of enterprises conducting ‘Public
relations and communication activities’. However, enterprises that
deliver public relations and communication activities also provide
such services for corporate clients (not only to the public sector and
individuals) for business purposes, that are unrelated to influencing
the democratic sphere. It has not been possible to distinguish them
by size class either, to assess the proportion of SMEs in the market.
(2) Data on the number of think tanks per Member State have been
extracted from the 2020 Global Go To Think Tank Report. The
dataset does not allow distinguishing the proportion of think tanks
listed that are 1) corporate (i.e. for-profit affiliated with a
corporation or operating on a for-profit basis), 2) those that are
government-affiliated, 3) those that are university-affiliated, and
those that are 4) political party-affiliated.
(3) Data on the size of the CSO sector in the internal market presented
here is based on a compilation of data provided in factsheets
developed within the context of a study to support the Citizens,
Equality, Rights and Values (CERV) programme on the
environment for CSOs in each country. Given important data
variations, e.g. source years, types of entities covered, definition of
civil society, the data is to be considered as indicative. In particular,
it is not clear in many cases if think tanks and educational
institutions are included.
By combining the data on: i) public relations and communications enterprises; ii) non-profit
organisations; and iii) think tanks, the following table presents a proxy for the total number of
possible interest representation service providers per Member State. However, this should be
viewed with the abovementioned caveats and limitations in mind.
Estimates of the number of interest representation service providers, EU-27
Country PR and
communications
(M70.21) – 2020(4)
CSOs – mixed
source years(5)
Think Tanks –
2020
Total
Austria 1,200 117,000 86 118,286
Belgium 7,431 109,930 85 117,446
Bulgaria 404 13,736 47 14,187
Croatia 171 28,103 20 28,294
Cyprus 40 6,500 8 6,548
Czechia(1) 3,444 92,566 39 96,049
Denmark 1,393 100,000 52 101,445
Estonia 159 23,598 24 23,781
Finland 830 108,594 41 109,465
France 28,582 1,270,000 275 1,298,857
100
Germany 2,546 626,160 266 628,972
Greece 520 6,217 57 6,794
Hungary 2,819 61,034 54 63,907
Ireland 469 33,331 23 33,823
Italy 7,004 362,634 153 369,791
Latvia 365 11,526 14 11,905
Lithuania 789 14,000 24 14,813
Luxembourg 184 8,500 11 8,695
Malta 36 2,887 5 2,928
Netherlands 4,369 44,000 85 48,454
Poland 4,105 70,000 72 74,177
Portugal 682 68,000 83 68,765
Romania 983 60,657 58 61,698
Slovakia 65 20,100 33 20,198
Slovenia 258 26,466 7 26,731
Spain(2) 1,467 100,000 95 101,562
Sweden 4,145 99,021 101 103,267
EU-27(3) 74,460 3,484,560 1,818 3,560,838
(1)
Data on number of CZ enterprises missing from M70.21. Estimated by calculating M70.21 as an average
proportion of the total NACE category [M] (the lowest level at which CZ data was available) across the
Member States and applying that proportion to the CZ data for [M].
(2)
Rough estimate based on unofficial sources has been used for the number of Spanish CSOs.
(3)
EU-27 total for M70.21 is different to the total on Eurostat. Following the inclusion of the CZ estimate, the
EU-27 now presents the sum of the Member State-specific data.
(4)
Eurostat data: Annual detailed enterprise statistics for services (NACE Rev. 2 H-N and S95).
(5)
Source year of the data on CSOs varies across the Member States: 2023 (1MS – FI); 2022 (1 MS – RO); 2021
(13 MS – BG, HR, CY, CZ, DK, EE, HU, IE, LV, LT, LU, PL, SI); 2020 (3 MS – NL, PT, SK); 2019 (4 MS
– DE, IT, MT, SE); 2018 (2 MS – FR, EL); 2017 (1 MS – BE); 2010 (1 MS – AT); ES).
The geographical distribution is presented in the table above. France accounted for 40% of all
EU27 enterprises that delivered public relations and communication, and Belgium and Italy for
10% each. Similarly, France accounted for 28% of EU27 annual turnover of said-enterprises,
Belgium for 16% and Germany for 14% (Based on the 2020 Global Go To Think Tank Index
Report, edited by the University of Pennsylvania248
, 1,818 think tanks are listed in EU27,
noting that, amongst the categories of Think Tank Affiliations249
, some are corporate (ie. for-
profit affiliated with a corporation or operating on a for-profit basis), others are government-
affiliated or university-affiliated or political party-affiliated. France ranks sixth in their top 20
world ranking of countries with the largest number of think tanks, with 275 think tanks. It is
followed by Germany with 266 think tanks. Italy ranks 11th
with 153; Sweden is 16th
with 101
and Spain follows ranking 17th
with 95 think tanks. The full EU27 breakdown is presented
248
McGann, J. G., ‘2020 Global Go To Think Tank Index Report’, Global Go To Think Tank Index, University of
Pennsylvania, Scholarly Commons TTCSP, , Reports Think Tanks and Civil Societies Program (TTCSP), 2021, available
at 2020 Global Go To Think Tank Index Report (delegfrance.org) and https://repository.upenn.edu/think_tanks.
249
AUTONOMOUS AND INDEPENDENT: Significant independence from any one interest group or donor, and
autonomous in its operation and funding from government. QUASI-INDEPENDENT: Autonomous from government but
controlled by an interest group, donor or contracting agency that provides most of the funding and has significant influence
over operations of the think tank. GOVERNMENT-AFFILIATED: A part of the formal structure of government. QUASI-
GOVERNMENTAL: Funded exclusively by government grants and contracts but not a part of the formal structure of
government. UNIVERSITY-AFFILIATED: A policy research center at a university. POLITICAL-PARTY AFFILIATED:
Formally affiliated with a political party. CORPORATE (FOR-PROFIT): A for-profit public policy research organization,
affiliated with a corporation or merely operating on a for-profit basis.
101
below. France and Germany representing each 15% of EU27 think tanks listed in 2020 Global
Go To Think Tank Index Report.
2.3. The internal market for interest representation activities carried out on behalf
of third countries
Due to the lack of reliable data on interest representation activities carried out on behalf of third
countries (see section 2.1.2) the method to estimate the internal market for interest
representation activities carried out on behalf of third countries draws on the Australian Foreign
Influence Transparency Scheme (FITS) and the US Foreign Agents Registration Act (FARA).
As explained in details in the supporting study, the proportion of the interest representation
markets for foreign principals/agents in Australia and the US was used to estimate the
proportion of the total interest EU representation market that provide services to third countries.
It was found that 0.02% of possible interest representation service providers are directed /
remunerated by foreign countries in Australia, while this figure is 0.03% in the US. Both
proportions, as well as the average of the proportions for the 2 countries (i.e. 0.025%), were
applied to estimate the EU interest representation market.
The below table presents estimates for the number of entities carrying out interest
representation activities on behalf of third countries in each Member State.
Estimates of the number of entities carrying out interest representation activities on
behalf of third countries by scenario, EU-27
Country Total entities
carrying out
interest
representation
activities on
behalf of third
countries
Entities carrying out interest representation activities on
behalf of third countries – estimates by scenario
Low scenario
(0.02%)
Middle scenario
(0.025%)
High scenario
(0.03%)
Austria 118,286 24 30 35
Belgium 117,446 23 29 35
Bulgaria 14,187 3 4 4
Croatia 28,294 6 7 8
Cyprus 6,548 1 2 2
Czechia 96,049 19 24 29
Denmark 101,445 20 25 30
Estonia 23,781 5 6 7
Finland 109,465 22 27 33
France 1,298,857 260 325 390
Germany 628,972 126 157 189
Greece 6,794 1 2 2
Hungary 63,907 13 16 19
Ireland 33,823 7 8 10
Italy 369,791 74 92 111
Latvia 11,905 2 3 4
Lithuania 14,813 3 4 4
Luxembourg 8,695 2 2 3
Malta 2,928 1 1 1
102
Netherlands 48,454 10 12 15
Poland 74,177 15 19 22
Portugal 68,765 14 17 21
Romania 61,698 12 15 19
Slovakia 20,198 4 5 6
Slovenia 26,731 5 7 8
Spain 101,562 20 25 30
Sweden 103,267 21 26 31
EU-27 3,560,838 712 890 1,068
In light of the prominent caveats and limitations, the estimates place the size of the internal
market for interest representation activities carried out on behalf of third countries (and thus
the population of enterprises that would be subject to requirements under the proposed policy
options) at between 712-1,068 enterprises. By Member State, France (260-390), Germany
(126-189) and Italy (74-111) have the most entities carrying out interest representation
activities on behalf of third countries and contribute approximately 65% of all such entities
across the EU-27.
2.4. Interest representation activities carried out on behalf of third countries across
borders in the Union
Out of the number of entities identified in the previous section, a further estimate of the
population of entities carrying out interest representation activities on behalf of third countries
across border in the Union is detailed below.
In this context, operating cross-border is understood to mean an entity is either: i) operating in
its EU Member State of establishment and at the EU-level; or ii) operating in its EU Member
State of establishment and in at least one other EU Member State.
The identification of this sub-population of entities implies several methodological caveats.
First, there is limited publicly available data on the extent to which this population of entities
operates cross-border. Many Member States do not have registers or lists of entities conducting
these types of activities. Furthermore, exploratory comparisons were conducted for a selection
of national transparency registers. These led to the identification of only a very small number
of entities that are registered in more than one of the Member States mentioned; entities that
were almost exclusively individual companies.
Feedback from commercial stakeholders conducting interest representation activities also
suggested that cross-border activity was limited by the nature of the national-level interest
representation markets, which are characterised by national decision-making and cultural
specificities (e.g. language, political systems, contacts). In this context, the qualitative evidence
further indicates that businesses tend to operate cross-border either by acquiring local interest
representation entities or by working alongside independent local firms.
Second, the estimates already calculated for the total number of entities carrying out interest
representation in general, as well as the total number of entities carrying out interest
representation on behalf of third countries are based on a set of assumptions that limit the level
of certainty on the accuracy and precision of the estimates. Additional assumptions, which
bring their own caveats, would further decrease that level of certainty.
103
With these challenges clearly established, it is possible to generate a rough estimate of the
population of entities carrying out interest representation on behalf of third countries and
operating cross-border using assumptions based on data from the EU Transparency Register
(EU TR). Specifically, this estimate assumes that all EU-based entities from relevant entity
categories registered in the EU TR with a ‘Head office country’ that is not Belgium are
operating at both the EU-level and in the Member State in which they are established.
Conversely, this assumes that entities established in Belgium and registered in the EU TR
mostly operate at the EU level.
This aims to generate a rough estimate of the proportion of entities registered in the EU TR
that conduct interest representation activities at the EU level and at the national level. This
proportion can then be applied to the previously generated estimates on the population of
entities carrying out interest representation on behalf of third countries to determine the number
of entities operating at the EU-level and in at least one Member State.
A total of 7,460 entities within the categories included in this analysis are registered in the EU
TR. The proportion of these entities that have their head office in Belgium is 26.8%, ranging
from 7.4% for academic institutions to 38.8% for self-employed individuals. The figure 73.2%
was therefore applied for each Member State across the three scenarios developed to estimate
the total number of entities carrying out interest representation activities on behalf of third
countries. As illustrated in the detailed table below, an estimated 521-782 of the 712-1,068
entities operate cross-border.
However, a range of further caveats need to be highlighted. Given the data deficiencies
discussed above, it is not possible to calculate the number of entities that do not operate at the
EU-level, but operate cross-border. Beyond the assumptions based on ‘head office country’,
these estimates also assume that all entities are active at both the EU-level and in their Member
State of establishment, while it also assumes that the proportion of entities operating at both
the EU and national level holds true for their activities with third countries (rather than in
general). There is limited evidence to support these activity-based assumptions.
In addition, the entities excluded (i.e. those established in Belgium) may operate at the EU-
level, but also at the national-level in Belgium. Given the time available to conduct the analysis
and the number of entities, it has not been possible to ascertain to what extent these excluded
entities are operating solely at the EU-level.
Total – Estimate of entities carrying out interest representation activities on behalf of
third countries across border in the EU
Country
Low scenario
(0.02%)
Middle scenario
(0.025%)
High scenario
(0.03%)
Austria 17 22 26
Belgium 17 21 26
Bulgaria 2 3 3
Croatia 4 5 6
Cyprus 1 1 1
Czechia 14 18 21
Denmark 15 19 22
Estonia 3 4 5
Finland 16 20 24
France 190 238 285
Germany 92 115 138
104
Greece 1 1 1
Hungary 9 12 14
Ireland 5 6 7
Italy 54 68 81
Latvia 2 2 3
Lithuania 2 3 3
Luxembour
g
1 2 2
Malta 0 1 1
Netherlands 7 9 11
Poland 11 14 16
Portugal 10 13 15
Romania 9 11 14
Slovakia 3 4 4
Slovenia 4 5 6
Spain 15 19 22
Sweden 15 19 23
EU-27 521 652 782
3. Assessment of fragmentation
On the basis of extensive consultation with Member States as well as research conducted for
the supporting study, including the preparation of a mapping of relevant rules and policies, the
national frameworks applicable to interest representation activities were described and an
analysis of the fragmentation in the internal market of rules applicable to the various categories
of commercial and non-commercial actors identified was prepared and is explained in details
in Annex 6.
4. Estimation for costs for entities and Member States authorities
This section provides detailed information on the cost analysis for the calculation of the impacts
of the policy options. All the figures provided in this annex come from the supporting study.
4.1. Costs to Member State authorities
In line with the assessment of the practical implications of the proposed policy options
presented in chapter 6, Member State authorities will be required to bear a range of costs.
All Member States will be required to familiarise themselves with the legislative provisions.
Under policy option 1, the nature and scale of the costs will depend significantly on the
decisions taken by Member State authorities in response to the recommendations provided by
the Commission.
For policy options 2.1 and 2.2, Member State authorities will need to ensure the
implementation of a transparency regime and register that is in line with the proposed
interventions. In this regard, policy option 2.2 goes beyond option 2.1 by requiring Member
State authorities to establish a system to conduct prior authorisation checks on entities carrying
out interest representation activities and grant licences to operate on that basis.
Across all 3 options, as for entities conducting interest representation activities, the nature of
the practical implications and related costs for a specific Member State authority will also
105
depend on: i) whether a transparency register for interest representation already exists, as well
as the characteristics of the existing register; and ii) whether monitoring and enforcement
activities are already implemented.
In this context, Member States with an existing register and/or monitoring and enforcement
regime will be required to amend the existing systems, while Member States without a register
/ regime will need to create and develop new systems. Costs in this category will include both
one-off costs associated with the initial development / amendment of a transparency register /
regime, as well as recurrent costs related to the maintenance and management (including
monitoring, enforcement, reporting and participation in an EU-level advisory group) of the
regime.
Beyond these core costs, Member State authorities will also be called on to support the
establishment of an interconnection between national registers or appropriate
information sharing mechanisms. However, while it is assumed that costs in this category
will mostly be borne by the European Commission, Member State authorities interviewed for
the supporting study were also not able to provide feedback on: i) the nature of the changes
stemming from this activity; or ii) the scale of associated costs. As such, it has not been possible
to quantify the costs for Member State authorities related to this cost item.
The following sections present the available evidence, calculations, assumptions and
limitations / caveats for the main costs borne by Member State authorities, by policy option.
4.1.1. Policy option 1: Non-legislative measures
4.1.1.1. Scenario 1: Full take-up of the non-legislative measures
The costs for Member State authorities stemming from policy option 1 would depend
significantly on the extent to which each authority implements the recommended measures, as
well as the consistency and coherence between those measures. However, if implemented to
the extent where the provisions across the Member States would be similar enough to
contribute to the stated aims, the costs would be largely similar to those borne by Member State
authorities under policy option 2.1.
Should a given Member State decide to act – in line with the currently regulatory environment
across the Union – they could implement this recommendation by either: i) establishing a new
transparency regime and register for entities carrying out interest representation activities
on behalf of third countries; or ii) amending an existing general transparency regime for
interest representation or lobbying to explicitly capture any additional elements covered by the
recommendations.
Beyond ensuring the existence of a transparency regime / register for interest representation,
Member State authorities would need to make decisions on the alignment with any
recommendations on the composition of such a regime, including issues related to the scope of
the transparency regime / register (e.g. the definition and coverage of interest representation
activities), the types of requirements implemented (e.g. information disclosure and reporting
regimes, the types of information to be covered, record-keeping obligations etc.), and the
governance, supervision mechanisms and sanctions.
The following table indicates the different national-level responses required within this context
based on existing provisions:
106
Table 1: Summary of existing transparency provisions for interest representation across
the Member States and actions required to implement policy option 1 under Scenario 1
(Full take-up of the non-legislative measures)
Existing provisions Countries Actions to implement policy
option 1
No existing law or
register
9 (BG, CZ, DK, EE, HR,
LV, PT, SK, SE)
Establish new legal regime
Establish new register
No existing law, but a
register
2 (IT, NL) Establish new legal regime
Adapt existing register
Existing law, but no
register
3 (BE250
, HU, MT) Adapt existing legal regime
Establish new register
Existing law and
register
13 (AT, CY, DE, EL, ES,
FI, FR, IE, LT, LU, PL,
RO, SI)
Adapt existing legal regime
Adapt existing register
In addition, a total of 11 Member States spanning all 4 categories are in the process of
developing or amending their transparency regimes for interest representation or lobbying (BE,
BG, CZ, ES, IE, IT, LV, MT, NL, PL, SK). Any updates in this regard would impact the
changes required to implement policy option1 in those Member States.
While the costs are detailed more comprehensively in relation to policy option 2 (see below),
the maximum costs for Member State authorities over a 10-year time horizon under policy
option 1 are summarised in the following table. Key points to note in this regard are:
• The low/middle/high scenarios in this context refer to the scenarios elaborated within
the baseline on the estimated population of entities impacted by the policy options – i.e.
entities carrying out interest representation activities on behalf of third countries.
• The familiarisation costs are based on the type and scale of human resource required
(seniority of staff and time). It is assumed in this context that the activity is conducted
by professionals at ISCO 2 level and requires 2-6 hours of their time.
• While some evidence was provided by stakeholders on the costs related to ensuring an
appropriate register is in place (i.e. costs of developing a new register or amending an
existing register), it was not possible to develop EU-wide cost estimates. This is because
the examples provided are too disparate and too few to establish a solid basis on which
to approximate costs.
• The Member States with an existing register/IT tool already incur certain maintenance
costs. Due to the limited number of entities estimated to be within scope, it was assumed
that a notable increase in maintenance costs would not be experienced by these
countries. As such, these costs are considered to be business-as-usual (BaU) costs.
• For Member States without an existing register / IT tool, data on the annual maintenance
costs in various Member States with registers (e.g. LT, IT, AT) were used to estimate
the maintenance costs for those Member States without registers – 3 cost scenarios were
developed (EUR 5,000 – low; EUR 20,000 – middle; EUR 45,000 – high). However,
as for the costs on register development, these cost estimates face a range of challenges
related to the representativeness and comparability of the available data.
250
While a register exists in BE, there is currently no IT tool; instead, the register is published as a PDF document. As such,
it is assumed that the BE authorities would need to develop a new IT tool.
107
• As for the familiarisation costs, the costs associated with managing, monitoring and
enforcement have been calculated as a product of the type and scale of human resource
required to conduct these activities. 3 scenarios were developed using data provided by
representatives of Member State authorities on the incremental increase in FTEs
anticipated as a result of the introduction of the policy measures described. More
specifically, low (2 FTEs), middle (2.5 FTEs) and high (3 FTEs) scenarios were used.
Evidence on the seniority of staff involved in these activities and the division of labour
between staff was then used to calculate Member State specific costs, which were
extrapolated to the EU level. It was assumed in this context that each FTE was split
between an ISCO 2 professional (0.3 FTEs) and an ISCO 4 level clerk (0.7 FTEs).
Table 2: Policy option 1 – Summary of maximum total costs to Member State authorities
(over 10-years) under Scenario 1 (Full take-up of the non-legislative measures)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Familiarisation costs 1,533.06 3,066.11 4,599.17
Ensuring an appropriate
register is in place
Not possible to ascertain EU-wide costs based on the
available data.
IT tool maintenance (15
Member States with existing IT
tools)
Costs are considered to be business as usual (BaU)
costs.
IT tool maintenance (12
Member States without existing
IT tools)
540,000.00 2,160,000.00 4,860,000.00
Implementing appropriate
management, monitoring and
enforcement mechanisms
5,654,945.59 7,068,681.99 8,482,418.39
Total: 6,196,478.65 9,231,748.10 13,347,017.56
4.1.1.2. Scenario 2: 50% take-up of the non-legislative measures
To further accommodate the lack of certainty on the nature and scale of the PO1 costs, this
section assesses an additional scenario reflecting medium uptake of the soft-law measures
contained within the option. Given the range of parameters that could differ in national level
implementations (e.g. whether or not a register is developed/adapted in a given country,
whether registration is mandatory, what exact registration and information disclosure
obligations will be implemented, which Member States have developed a register etc.), it is
complex to establish such a medium uptake scenario.
As such, a simple assumption is proposed, considering that 50% of Member States implement
the measures fully (i.e. such that they are similar enough to contribute to the stated aims of the
intervention). However, this assumption limits the level of certainty on the accuracy and
precision of the estimates.
Under this assumption, the costs for Member State authorities over the 10-year time horizon
are summarised in the below table. While it is considered more likely that Member States with
existing registers would take steps to implement PO1, as less effort would be required, there is
no concrete evidence for this. On this basis, these estimates further assume that approximately
half of the Member States with an existing register (8 of 15) and half of the Member States
without an existing register (6 of 12) will implement the measures under PO1. The amended
108
familiarisation costs and costs associated with implementing management, monitoring and
enforcement mechanisms are a product of the above figures (i.e. under the full implementation
scenario) multiplied by the proportion of Member States covered (14 of 27, 51.9%).
Table 3: Policy option 1 – Summary of maximum total costs to Member State authorities
(over 10-years) under Scenario 2 (50% take-up of the non-legislative measures)
Cost item
Low scenario
– # of entities
(EUR)
Middle scenario
– # of entities
(EUR)
High scenario
– # of entities
(EUR)
Familiarisation costs 794.92 1,589.83 2,384.75
Ensuring an appropriate
register is in place
Not possible to ascertain EU-wide costs based on the
available data.
IT tool maintenance (15
Member States with existing IT
tools)
Costs are considered to be business as usual (BaU)
costs.
IT tool maintenance (12
Member States without existing
IT tools)
270,000.00 1,080,000.00 2,430,000.00
Implementing appropriate
management, monitoring and
enforcement mechanisms
2,932,194.01 3,665,242.51 4,398,291.02
Total: 3,202,988.93 4,746,832.35 6,830,675.77
4.1.2. Policy option 2.1: Targeted legislative intervention
In line with the above categorisation of costs, the below table summarises the nature of the
different costs to Member State authorities that are relevant within policy option 2.1.
Table 4: Policy option 2.1 – Summary of costs to Member State authorities
Cost items – Member
State authorities
One-off
vs.
recurrent
Type
Frequen
cy
Number of
Member States
Familiarisation costs
Adjustment cost
One-off
Implementati
on
Year 1 EU-27
Establish new register /
regime
Adjustment cost
One-off Equipment Year 1
12 MS (BE251
, BG,
HR, CZ, DK, EE,
HU, LV, MT, PT,
SK, SE)
Amend existing register /
regime
Adjustment cost
One-off Equipment Year 1
15 MS (AT, CY, FI,
FR, DE, EL, IE, IT,
LT, LU, NL, PL,
RO, SI, ES)
IT maintenance
Adjustment cost
Recurrent
Implementati
on
Years 2-
10,
annual
EU-27
251
While a register exists in BE, there is currently no IT tool; instead, the register is published as a PDF document. As such,
it is assumed that the BE authorities would need to develop a new IT tool.
109
Cost items – Member
State authorities
One-off
vs.
recurrent
Type
Frequen
cy
Number of
Member States
Amend and operate
management,
monitoring &
enforcement systems
Enforcement cost
Recurrent
Direct labour
costs +
overheads
Years 1-
10,
annual
EU-27
4.1.2.1. Familiarisation costs
Familiarisation costs will be borne by all Member State authorities, as they will need to
understand the implications of the legislative text and plan for the implementation of the
provisions. The following assumptions are made in this context:
• This cost is borne by all Member State authorities equally, regardless of the presence
of an existing register / transparency regime.
• As for interest representation service providers, this activity is conducted by
professionals at ISCO 2 level.
• The time required is on par with the extended familiarisation costs borne by interest
representation service providers within scope, due to the need to develop
implementation and compliance strategies. As such, 3 scenarios are presented for the
time commitments for these activities (low, 2 hours; middle, 4 hours; high, 6 hours).
The below table presents the Member State-specific and total costs for the 3 scenarios. As can
be seen, the estimated familiarisation costs to Member State authorities would range from
EUR 1,500 to EUR 4,600.
Table 5: Estimated familiarisation costs: Member State authorities
Country
ISCO 2
income:
EUR per
hour(1)
Cost scenarios in EUR (time spent * ISCO 2 income)
Low scenario (2
hr)
Middle scenario (4
hrs)
High scenario (6
hrs)
Austria 42.18 84.35 168.71 253.06
Belgium 50.42 100.85 201.70 302.55
Bulgaria 7.25 14.50 29.00 43.50
Croatia 13.62 27.24 54.49 81.73
Cyprus 25.76 51.52 103.03 154.55
Czechia 17.07 34.13 68.26 102.39
Denmark 50.23 100.47 200.93 301.40
Estonia 16.91 33.82 67.64 101.45
Finland 41.02 82.04 164.08 246.12
France 44.06 88.11 176.23 264.34
Germany 46.81 93.61 187.23 280.84
Greece 21.74 43.49 86.98 130.46
Hungary 12.16 24.31 48.63 72.94
Ireland 48.08 96.16 192.32 288.48
Italy 42.39 84.78 169.55 254.33
Latvia 13.60 27.21 54.42 81.63
110
Country
ISCO 2
income:
EUR per
hour(1)
Cost scenarios in EUR (time spent * ISCO 2 income)
Low scenario (2
hr)
Middle scenario (4
hrs)
High scenario (6
hrs)
Lithuania 11.81 23.62 47.25 70.87
Luxembou
rg
46.01 92.02 184.04 276.07
Malta 20.30 40.60 81.20 121.81
Netherlan
ds
41.76 83.53 167.06 250.59
Poland 13.19 26.38 52.76 79.14
Portugal 20.77 41.53 83.06 124.59
Romania 12.92 25.84 51.68 77.52
Slovakia 14.27 28.55 57.09 85.64
Slovenia 19.51 39.02 78.04 117.05
Spain 29.59 59.17 118.35 177.52
Sweden 43.10 86.20 172.40 258.61
Total: 1,533.06 3,066.11 4,599.17
(1)
EU wage tariffs: Hourly earnings 2018 plus non-wage labour costs (NWLC) and 25% overheads (OH), per
Member State and ISCO (International Standard Classification of Occupations) category, last updated January
2021. ISCO 2 covers professionals, including legal, social and cultural professionals.
4.1.2.2. Ensuring an appropriate transparency regime and register exists
This cost type can be broken down into 3 main components: i) ensuring an appropriate
register/IT tool is in place; ii) maintaining the IT tool; and iii) ensuring an appropriate
management, monitoring and enforcement regime is in place. Data on the nature and scale of
these costs was collected through interviews with authorities from 7 Member State with an
existing register (AT, BE, DE, FR, IE, LT, RO) and 2 Member States (CZ, LV) without an
existing register, as well as a review of documentation related to existing transparency laws
and registers (e.g. Austrian Court of Audit report on the national register for lobbying and
interest representation252
).
In general, Member State authorities were unable to provide concrete data, considering the
costs of conducting the activities necessary to comply with the proposed legislative
intervention, but, in some cases, also the costs related to the development and management of
existing registers. Certain authorities could not provide information on decisions related to IT
funding, as this information was not available to them (e.g. on the original costs of developing
a register) or these costs were not within their remit. Furthermore, authorities stated that it was
difficult to estimate future costs without knowing the full details of the proposed intervention.
In this context, it is important to highlight that, in many cases, feedback was provided before
the final scope of the policy options were finalised.
With these caveats established, however, some data was provided across the interviewed
authorities. This evidence on the nature and scale of different cost components is now
presented.
• Ensuring an appropriate register is in place: This will require one-off costs to be
borne by Member State authorities in year 1 relating to either: i) establishing a new
252
‘Lobbying und Interessenvertretungs Register’ (‘Lobbying and advocacy register’), Rechnungshof Österreich, Bericht –
Federal Court of Auditors, 2019, available at:
https://www.rechnungshof.gv.at/rh/home/home/BUND_2019_45_Lobbying_Register.pdf.
111
register (for up to 12 countries); or ii) amending an existing register (for a minimum of
15 countries). While 11 Member States currently have new or updated transparency
laws for interest representation or lobbying in development, it is assumed for the
purposes of this analysis that these interventions are not implemented prior to the
adoption of the proposed EU legislative initiative. As further explained in the below
table, it is only possible to provide examples that are indicative of the magnitude of the
compliance costs.
Table 6: Costs associated with ensuring an appropriate register is implemented
Evidence on the scale of the cost: Ensuring an appropriate register is in place
Data on the initial transparency register development costs were provided in Austria,
Lithuania and Germany. The Lithuanian register cost around EUR 130,000 to develop, while
the costs for the development and maintenance of the German register were reported to be
EUR 2-3 million. The Austrian register reportedly cost at least EUR 87,716.16 and less than
EUR 100,000; however, the exact costs are not completely clear. Furthermore, the Austrian
Court of Audit determined that a planned amendment to the functionality of the Austrian
register would cost at least EUR 3,487.53.
While these data provide useful indications of the possible scale of the costs, they are also
too few and too disparate to establish a basis on which the approximate costs of developing
or amending a transparency register for interest representation or lobbying can be calculated
for: i) those Member States where data is not available; and ii) extrapolation to the entire
EU.
More specifically, significant efforts have been made to adjust the known costs of both
developing a new register and amending an existing register, for instance by adjusting the
figures to account for the whole population or the register user population (i.e. interest
representation service providers). However, this approach is limited as there is significant
variance in the cost examples, both in general and in proportion to other relevant factors (e.g.
user population), while the register development costs appear to be heavily dependent on the
nature of the system implemented and limited technical details on the systems in place are
available.
• Maintenance of the IT tool: Once established, Member States will be required to
ensure the proper functioning of the IT tool. This will bring annual maintenance costs.
It is assumed that costs related to the maintenance of the IT tool in year 1 are covered
by the above equipment costs. As such, the maintenance costs will be calculated as
recurrent across years 2-10 within the 10-year time horizon. The below table presents
the evidence on the estimated scale of the IT maintenance costs.
Table 7: Costs associated with maintenance of the IT tool
Evidence on the scale of the cost: Maintenance of the IT tool
Data on the annual maintenance costs for existing registers were provided in Lithuania (EUR
20-30,000 per year), Ireland (EUR 20-25,000 per year) and Austria (EUR 5,000 per year),
while maintenance was included in the total cost of the German register provided above. On
this basis, it is assumed that the Member States with existing registers will not experience a
notable increase in maintenance costs due to the limited number of interest representation
service providers within scope of the intervention. As such, annual IT maintenance costs will
be considered as business as usual (BaU) costs for the 15 Member States with existing
112
registers. The incremental costs in this category will therefore be borne solely by those 12
Member States that do not currently have registers.
However, as for the cost data related to ensuring an appropriate register is implemented,
there are a range of challenges related to the extrapolation of the data on IT maintenance
costs to these Member States. In particular, the scale of the costs has no notable link to the
scale of the register and appears to rely on the nature of the maintenance required and the
scope of the systems in place. For instance, the Lithuanian and Austrian registers have a
similar number of registrants – 385 in AT versus 303 in LT – but the maintenance costs in
Lithuania are reportedly up to 6x more per year than in Austria.
Taking rough low (EUR 5,000), middle (EUR 20,000) and high (EUR 45,000) cost
scenarios, based on the data provided and the insight that more costly and complex registers
exist (e.g. in Germany), it is estimated that the total incremental costs across the 12 Member
State authorities without existing IT tools will be between EUR 60,000 and EUR 540,000.
Across years 2-10 of the 10-year time horizon, this would equate to approximately EUR
540,000 to EUR 4.86 million.
• Ensuring an appropriate management, monitoring and enforcement regime is in
place: This will require Member State authorities to bear costs in year 1 related to
either: i) establishing and operating a new management, monitoring and enforcement
regime; or ii) amending and operating an existing regime. These costs will then be
recurrent across years 2-10. The below table presents the evidence gathered on the
estimated scale of the management, monitoring and enforcement costs.
Table 8: Costs associated with ensuring an appropriate management, monitoring and
enforcement regime is implemented
Evidence on the scale of the cost: Ensuring an appropriate management, monitoring
and enforcement regime is implemented
Data on the existing costs for management, monitoring and enforcement were provided by
Member State authorities in 6 countries, as follows: Austria (around 1 FTE across 2 teams),
Germany (around 8 FTEs), Ireland (around 4 FTEs), Lithuania (around 1.5 FTEs) and
Romania (around 2 FTEs). In Austria, additional detail is provided by the Court of Audit
report, which notes that 0.3 FTEs are provided by the judicial / prosecutorial service and 0.7
FTEs are provided by the general administration. Furthermore, in Germany, it was noted that
the suggested changes to be implemented through the proposed legislative intervention
would require an addition 2-3 FTEs.
Using these data, it is possible to provide rough estimates of the human resource required for
management, monitoring and enforcement across the Member States, as well as the costs
associated with that resource. In this context, the following process was conducted:
• Three scenarios have been developed utilising the data from Germany on the increase
in FTEs required as a result of the potential legislative intervention. These include a
low (2 FTEs), middle (2.5 FTEs) and high (3 FTEs) scenario. These scenarios have
been used to calculate the proportional increase in human resources in the Member
States where data is available.
• Building on the data from Austria, responsibility for management, monitoring and
enforcement will be split between 0.3 FTEs of an ISCO 2 level professional and 0.7
FTEs of an ISCO 4 level clerk. This time split has been applied to the proportional
human resource increases calculated for each scenario in each Member State. The
113
EU wage tariffs, which combine direct labour costs and overheads, for ISCO 2 and
ISCO 4 workers in each Member State were then applied to the proportions to obtain
estimated costs for each scenario.
• For the Member States where no data was available, costs were calculated based on
the median cost per organisation for each scenario in the 6 Member States with data
and the annual ISCO 2 and ICSO 4 labour costs.
• This requires assumptions related to the scale of the additional resource required, as
well as the nature and responsibilities of the workers involved in management,
monitoring and enforcement activities. In addition, the annual wages for ISCO 2 and
ISCO 4 workers in each Member State were calculated using averages of 251
working days per year and 8 working hours per day.
On this basis, it is estimated that the incremental costs associated with the implementation
of appropriate register management, monitoring and enforcement systems will cost Member
State authorities between approximately EUR 565,000 and EUR 848,000 per year. As such,
across the 10-year time horizon, the total costs to Member State authorities are estimated to
be in the region of EUR 5.65-8.48 million. The estimates are presented in the below table.
Table 9: Estimated annual incremental costs of register management, monitoring and
enforcement
Country
Low scenario (EUR
per year)
Middle scenario (EUR
per year)
High scenario (EUR
per year)
Austria 16,200.60 20,250.75 24,300.90
Belgium 20,913.85 26,142.32 31,370.78
Bulgaria 2,526.31 3,157.89 3,789.46
Croatia 5,038.37 6,297.96 7,557.56
Cyprus 1,166.02 1,457.52 1,749.02
Czechia 17,103.64 21,379.56 25,655.47
Denmark 18,064.52 22,580.65 27,096.78
Estonia 4,234.73 5,293.41 6,352.10
Finland 19,492.66 24,365.82 29,238.99
France 79,325.91 99,157.39 118,988.87
Germany 137,859.90 172,324.87 206,789.85
Greece 1,209.82 1,512.28 1,814.73
Hungary 11,380.05 14,225.06 17,070.08
Ireland 66,989.70 83,737.13 100,484.56
Italy 65,849.45 82,311.81 98,774.17
Latvia 2,119.95 2,649.93 3,179.92
Lithuania 6,669.85 8,337.31 10,004.77
Luxembour
g 1,548.34 1,935.42 2,322.50
Malta 521.40 651.74 782.09
Netherland
s 8,628.30 10,785.38 12,942.46
Poland 13,208.85 16,511.06 19,813.28
Portugal 12,245.13 15,306.41 18,367.69
Romania 8,366.15 10,457.68 12,549.22
Slovakia 3,596.70 4,495.87 5,395.05
114
Country
Low scenario (EUR
per year)
Middle scenario (EUR
per year)
High scenario (EUR
per year)
Slovenia 4,760.04 5,950.06 7,140.07
Spain 18,085.36 22,606.69 27,128.03
Sweden 18,388.97 22,986.21 27,583.45
Total: 565,494.56 706,868.20 848,241.84
Over 10
years
5,654,945.59 7,068,681.99 8,482,418.39
4.1.2.3. Summary of costs: Member State authorities
In total, under policy option 2.1, the estimated costs to Member State authorities over a 10-year
time horizon can be summarised as follows:
Table 10: Policy option 2.1 – Summary of total costs to Member State authorities (over
10-years)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Familiarisation costs 1,533.06 3,066.11 4,599.17
Ensuring an appropriate
register is in place
Not possible to ascertain EU-wide costs based on the
available data.
IT tool maintenance (15
Member States with existing IT
tools)
Costs are considered to be business as usual (BaU)
costs.
IT tool maintenance (12
Member States without existing
IT tools)
540,000.00 2,160,000.00 4,860,000.00
Implementing appropriate
management, monitoring and
enforcement mechanisms
5,654,945.59 7,068,681.99 8,482,418.39
Total: 6,196,478.65 9,231,748.10 13,347,017.56
4.1.3. Policy option 2.2: Extended legislative intervention
Many of the costs to be borne by Member State authorities under policy option 2 would also
be relevant under policy option 2.2. Concretely, this includes:
• Familiarisation costs: While the provisions of the interventions proposed under
options 2.1 and 2.2 will be different, it is assumed that the time required for Member
State authorities to familiarise themselves with the provisions and develop an
implementation strategy would be the same.
• Implementing, managing, monitoring and enforcing an appropriate transparency
regime / register: As for policy option 2.1, policy option 2.2 would require Member
States to ensure that an appropriate transparency regime / register for interest
representation on behalf of third countries is in place. The activities required to monitor
and enforce that regime would also be largely similar.
However, option 2.2 would also require Member States to establish a system for managing
and granting applications for EU-wide licences to conduct interest representation activities
115
on behalf of third countries. This system would bring additional recurrent costs for Member
State authorities.
The below table summarises the nature of the different costs to Member State authorities under
policy option 2.2.
Table 11: Policy option 2.2 – Summary of costs to Member State authorities
Cost items – Member
State authorities
One-off
vs.
recurrent
Type
Frequen
cy
Number of
Member States
Familiarisation costs
Adjustment cost
One-off
Implementati
on
Year 1 EU-27
Establish new register /
regime
Adjustment cost
One-off Equipment Year 1
12 MS (BE253
, BG,
HR, CZ, DK, EE,
HU, LV, MT, PT,
SK, SE)
Amend existing register /
regime
Adjustment cost
One-off Equipment Year 1
15 MS (AT, CY, FI,
FR, DE, EL, IE, IT,
LT, LU, NL, PL,
RO, SI, ES)
IT maintenance
Adjustment cost
Recurrent
Implementati
on
Years 2-
10,
annual
EU-27
Amend and operate
management,
monitoring &
enforcement systems
Enforcement cost
Recurrent
Direct labour
costs +
overheads
Years 1-
10,
annual
EU-27
Establish system for
processing licence
applications
Adjustment cost
One-off
Implementati
on
Year 1 EU-27
Operate the system for
processing licence
applications
Enforcement cost
Recurrent
Direct labour
costs +
overheads
Years 1-
10,
annual
EU-27
4.1.3.1. Establish and operate a system for processing prior authorisation /
licensing applications
Novel costs will be borne by all Member States related to establishing and operating a system
for processing and granting licences to carry out interest representation on behalf of third
countries. More specifically, Member States will be required to:
Establish a system for processing licence applications, which could include activities such
as stipulating the information to be provided within applications and the process by which
applications will be submitted, developing tools to support the application process, and
determining the criteria on which applications should or should not be granted, as well the
253
While a register exists in BE, there is currently no IT tool; instead, the register is published as a PDF document. As such,
it is assumed that the BE authorities would need to develop a new IT tool.
116
responsibilities for such activities. The costs related to establishing the system would be borne
in year 1 following the adoption of policy option 2.2.
Given the novel nature of these costs, no feedback was provided directly by relevant
stakeholders on their scale. However, many of them could be considered as covered by the
other cost items. More specifically, the information to be provided, the criteria against which
applications should be judged and the allocation of responsibilities could be incorporated into
the familiarisation costs with limited impact on the scale of those costs.
Operate the system for processing licence applications. This cost would take the form of the
human resources required to review, request further information (if necessary) and make
decisions on individual applications. This cost is recurrent in all years. However, the scale of
this cost will depend significantly on the scale of applications per year and will therefore differ
by Member State.
As above, no feedback was provided directly by relevant stakeholders on the scale of these
costs. While it is therefore difficult to assess the scale of the costs with certainty, it is possible
to develop rough estimates of: i) the number of applications per year using data on the estimated
number of entities within scope and data on new registrants per year as a proportion of total
active registrants from FITS and FARA; and ii) logical data estimates on the amount of time
taken and the type of human resource required to process an application. Noting the caveats
associated with this approach, as described throughout, these 2 estimates can then be used to
develop an estimate for the total annual costs of operating the system for processing
applications in each Member State.
Given previous points related to the potential for entities to stop conducting such activities on
behalf of third countries, or the risk that certain entities do not apply, the number of entities
applying in the first year may not reach 100%. However, for the purposes of this scenario, it is
assumed that all entities within scope register in year 1 and that, over subsequent years, a certain
number of new entities apply each year. In FARA, the average number of new registrants in a
given year over the past 5 years of operation for which data is available (2016-2020) reached
25.8% of the total number of active registrants. This figure rises to 49.1% under FITS, where
only 3 full years of data (following year 1, from 2019-2022) were available.
The below table presents the number of first year applicants and the number of average new
applicants per year according to these estimates and assumptions. The low end of the range for
new applicants was calculated using the FARA figure of 25.8%, while the upper end of the
range was calculated using the FITS figure of 49.1%.
It is important to note that there are few additional challenges relating to these estimates. As
highlighted previously, there are significant differences between the transparency registers
implemented, as well as the markets for interest representation, between the EU, its Member
States, FITS and FARA. This could impact the accuracy of these figures. Moreover, FITS and
FARA do not take a prior authorisation / licencing approach, which could further impact the
proportion of entities within scope that apply for a licence under policy option 2.2. These data
should be read in this context.
Table 12: Policy option 2.2 – Estimated applications per year
First year applicants Average new applicants per
year
Low scenario 712 184-350
Middle scenario 890 229-437
High scenario 1,068 275-524
117
To determine the costs stemming from each application, it is necessary to understand: i) the
types of staff that would be involved in processing and granting applications; and ii) the time
that would be required to process each application. Building on the evidence provided in
relation to the other cost items on these elements, it is assumed that most of the processing
activity is conducted by ISCO 2 category professionals (2-6 hours per application), with limited
sign-off by ISCO 1 category managers or officials (0.5 hours per application in all scenarios).
This would cover an initial review of the inputs provided by the application to check that all
required inputs have been provided, cross-checking with existing data, requesting any
additional information that is required and ultimately granting the application.
To illustrate a selection of different scenarios, the below data tables consider the different
possibilities in terms the number of entities within scope (across 3 scenarios), the lower and
upper bounds of the estimated new applicants per year, and 3 scenarios for the time taken by
the ISCO 2 category worker to process each application (2, 4 and 6 hours).
The table below presents the estimated year 1 costs per Member State and in total across 3
scenarios: the low scenario combines the low estimate for the number of entities within scope
with the low estimate for time required to complete processing, the middle scenario combines
the middle estimates for these data, and the high scenario combines the high estimates for these
data.
Table 13: Policy option 2.2 – Estimated costs of processing licence applications (Years 1)
Year 1 costs
Low scenario
(number of entities)
Middle scenario
(number of entities)
High scenario
(number of entities)
Country
0.5 hours
- ISCO 1
2 hours -
ISCO 2
0.5 hours
- ISCO 1
4 hours -
ISCO 2
0.5 hours
- ISCO 1
6 hours -
ISCO 2
Austria 735.87 1,995.57 919.83 4,988.93 1,103.80 8,980.08
Belgium 759.75 2,368.88 949.69 5,922.20 1,139.63 10,659.95
Bulgaria 16.02 41.14 20.02 102.85 24.03 185.13
Croatia 51.86 154.16 64.83 385.41 77.79 693.74
Cyprus 31.46 67.47 39.32 168.67 47.19 303.60
Czechia 247.02 655.66 308.78 1,639.14 370.53 2,950.45
Denmark 751.82 2,038.36 939.78 5,095.90 1,127.73 9,172.61
Estonia 49.85 160.84 62.31 402.11 74.78 723.79
Finland 754.47 1,796.08 943.09 4,490.21 1,131.71 8,082.37
France 7,624.25 22,889.69 9,530.31 57,224.23 11,436.38
103,003.6
2
Germany 4,716.28 11,776.07 5,895.35 29,440.17 7,074.42 52,992.30
Greece 21.55 59.09 26.93 147.73 32.32 265.91
Hungary 109.87 310.77 137.33 776.92 164.80 1,398.46
Ireland 169.51 650.47 211.89 1,626.18 254.27 2,927.13
Italy 2,749.55 6,269.92 3,436.93 15,674.80 4,124.32 28,214.64
Latvia 21.13 64.78 26.41 161.96 31.70 291.53
Lithuania 23.69 69.99 29.62 174.96 35.54 314.93
Luxembourg 60.46 160.03 75.58 400.07 90.69 720.12
Malta 7.94 23.78 9.92 59.44 11.91 106.99
Netherlands 271.96 809.47 339.95 2,023.67 407.94 3,642.60
Poland 131.47 391.34 164.34 978.35 197.20 1,761.02
Portugal 207.07 571.17 258.84 1,427.93 310.61 2,570.28
Romania 97.68 318.86 122.09 797.16 146.51 1,434.88
118
Year 1 costs
Low scenario
(number of entities)
Middle scenario
(number of entities)
High scenario
(number of entities)
Country
0.5 hours
- ISCO 1
2 hours -
ISCO 2
0.5 hours
- ISCO 1
4 hours -
ISCO 2
0.5 hours
- ISCO 1
6 hours -
ISCO 2
Slovakia 44.43 115.32 55.54 288.30 66.65 518.93
Slovenia 81.19 208.60 101.48 521.49 121.78 938.69
Spain 416.35 1,201.95 520.44 3,004.88 624.52 5,408.79
Sweden 654.04 1,780.36 817.55 4,450.90 981.06 8,011.62
EU-27 Total
(per ISCO)
20,806.54 56,949.82 26,008.18
142,374.5
4
31,209.81
256,274.1
8
Total 77,756.36 168,382.72 287,483.99
The 2 tables below present the lower and upper bounds, respectively, of the estimated costs of
processing licence applications per Member State and in total across years 2-10 and across 3
scenarios. The first table presents the lower bound (based on the FARA proportion of new
registrants), while the second presents the upper bound (based on the FITS proportion of new
registrants). The scenarios are formulated as above, combining the low/middle/high scenarios
for the number of entities with the low/middle/high scenarios for the time required.
Table 14: Policy option 2.2 – Estimated costs of processing licence applications (Years 2-
10, lower bound)
Years 2-10 -
Lower bound
Low scenario
(number of entities)
Middle scenario
(number of entities)
High scenario
(number of entities)
Country
0.5 hours
- ISCO 1
2 hours -
ISCO 2
0.5 hours
- ISCO 1
4 hours -
ISCO 2
0.5 hours
- ISCO 1
6 hours -
ISCO 2
Austria 189.85 514.86 237.32 1,287.14 284.78 2,316.86
Belgium 196.02 611.17 245.02 1,527.93 294.02 2,750.27
Bulgaria 4.13 10.61 5.17 26.53 6.20 47.76
Croatia 13.38 39.77 16.73 99.44 20.07 178.98
Cyprus 8.12 17.41 10.15 43.52 12.17 78.33
Czechia 63.73 169.16 79.66 422.90 95.60 761.22
Denmark 193.97 525.90 242.46 1,314.74 290.96 2,366.53
Estonia 12.86 41.50 16.08 103.74 19.29 186.74
Finland 194.65 463.39 243.32 1158.47 291.98 2,085.25
France 1,967.06 5,905.54 2,458.82
14,763.8
5
2,950.59
26,574.9
3
Germany 1,216.80 3,038.23 1,521.00 7,595.56 1,825.20
13,672.0
1
Greece 5.56 15.25 6.95 38.11 8.34 68.60
Hungary 28.35 80.18 35.43 200.45 42.52 360.80
Ireland 43.73 167.82 54.67 419.56 65.60 755.20
Italy 709.38 1,617.64 886.73 4,044.10 1,064.07 7,279.38
Latvia 5.45 16.71 6.81 41.79 8.18 75.21
Lithuania 6.11 18.06 7.64 45.14 9.17 81.25
Luxembourg 15.60 41.29 19.50 103.22 23.40 185.79
Malta 2.05 6.13 2.56 15.34 3.07 27.60
Netherlands 70.17 208.84 87.71 522.11 105.25 939.79
Poland 33.92 100.97 42.40 252.41 50.88 454.34
Portugal 53.42 147.36 66.78 368.41 80.14 663.13
Romania 25.20 82.27 31.50 205.67 37.80 370.20
119
Years 2-10 -
Lower bound
Low scenario
(number of entities)
Middle scenario
(number of entities)
High scenario
(number of entities)
Country
0.5 hours
- ISCO 1
2 hours -
ISCO 2
0.5 hours
- ISCO 1
4 hours -
ISCO 2
0.5 hours
- ISCO 1
6 hours -
ISCO 2
Slovakia 11.46 29.75 14.33 74.38 17.20 133.89
Slovenia 20.95 53.82 26.18 134.55 31.42 242.18
Spain 107.42 310.10 134.27 775.26 161.13 1,395.47
Sweden 168.74 459.33 210.93 1,148.33 253.11 2,067.00
EU-27 Total
(per ISCO)
5,368.09
14,693.0
5
6,710.11
36,732.6
3
8,052.13
66,118.7
4
Total (per
year)
20,061.14 43,442.74 74,170.87
Total (Years
2-10)
200,611.41 434,427.42 741,708.70
Table 15: Policy option 2.2 – Estimated costs of processing licence applications (Years 2-
10, upper bound)
Years 2-10 -
Upper bound
Low scenario
(number of entities)
Middle scenario
(number of entities)
High scenario
(number of entities)
Country
0.5 hours
- ISCO 1
2 hours -
ISCO 2
0.5 hours
- ISCO 1
4 hours -
ISCO 2
0.5 hours
- ISCO 1
6 hours -
ISCO 2
Austria 361.31 979.83 451.64 2,449.57 541.97 4,409.22
Belgium 373.04 1,163.12 466.30 2,907.80 559.56 5,234.04
Bulgaria 7.87 20.20 9.83 50.50 11.80 90.90
Croatia 25.46 75.69 31.83 189.24 38.20 340.63
Cyprus 15.45 33.13 19.31 82.82 23.17 149.07
Czechia 121.29 321.93 151.61 804.82 181.93 1,448.67
Denmark 369.14 1,000.83 461.43 2,502.09 553.72 4,503.75
Estonia 24.48 78.97 30.60 197.43 36.72 355.38
Finland 370.45 881.88 463.06 2,204.69 555.67 3,968.45
France 3,743.51
11,238.8
4
4,679.38
28,097.1
0
5,615.26
50,574.7
8
Germany 2,315.69 5,782.05 2,894.62
14,455.1
2
3,473.54
26,019.2
2
Greece 10.58 29.01 13.22 72.53 15.87 130.56
Hungary 53.94 152.59 67.43 381.47 80.92 686.65
Ireland 83.23 319.38 104.04 798.46 124.85 1,437.22
Italy 1,350.03 3,078.53 1,687.53 7,696.33 2,025.04
13,853.3
9
Latvia 10.38 31.81 12.97 79.52 15.56 143.14
Lithuania 11.63 34.36 14.54 85.91 17.45 154.63
Luxembourg 29.69 78.57 37.11 196.43 44.53 353.58
Malta 3.90 11.67 4.87 29.19 5.85 52.53
Netherlands 133.53 397.45 166.92 993.62 200.30 1,788.52
Poland 64.55 192.15 80.69 480.37 96.83 864.66
Portugal 101.67 280.45 127.09 701.11 152.51 1,262.01
Romania 47.96 156.56 59.95 391.40 71.94 704.53
120
Years 2-10 -
Upper bound
Low scenario
(number of entities)
Middle scenario
(number of entities)
High scenario
(number of entities)
Country
0.5 hours
- ISCO 1
2 hours -
ISCO 2
0.5 hours
- ISCO 1
4 hours -
ISCO 2
0.5 hours
- ISCO 1
6 hours -
ISCO 2
Slovakia 21.82 56.62 27.27 141.55 32.72 254.80
Slovenia 39.86 102.42 49.83 256.05 59.79 460.90
Spain 204.43 590.16 255.53 1,475.40 306.64 2,655.72
Sweden 321.13 874.16 401.42 2,185.39 481.70 3,933.71
EU-27 Total
(per ISCO)
10,216.01
27,962.3
6
12,770.01
69,905.9
0
15,324.02
125,830.
62
Total (per
year)
38,178.37 82,675.92 141,154.64
Total (Years
2-10)
381,783.72 826,759.16 1,411,546.40
On this basis, the total costs associated with processing and granting licence applications for
entities carrying out interest representation activities on behalf of third countries range from
EUR 278 thousand to EUR 1.7 million across the 10-year time horizon. These are summarised
in the below table.
Table 16: Policy option 2.2 – Total estimated costs of processing licence applications
Low scenario
(entities & time)
Middle scenario
(entities & time)
High scenario
(entities & time)
Lower bound (years
1-10)
278,367.77 602,810.14 1,029,192.69
Upper bound (years
1-10)
459,540.08 995,141.88 1,699,030.39
4.1.3.2. Summary of costs: Member State authorities
In total, under policy option 2.2, the estimated costs to Member State authorities over a 10-year
time horizon can be summarised as follows:
Table 17: Policy option 2.2 – Summary of total costs to Member State authorities (over
10-years)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Familiarisation costs 1,533.06 3,066.11 4,599.17
Ensuring an appropriate
register is in place
Not possible to ascertain EU-wide costs based on the
available data.
IT tool maintenance (15
Member States with existing IT
tools)
Costs are considered to be business as usual (BaU)
costs.
IT tool maintenance (12
Member States without existing
IT tools)
540,000.00 2,160,000.00 4,860,000.00
Implementing appropriate
management, monitoring and
enforcement mechanisms
5,654,945.59 7,068,681.99 8,482,418.39
121
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Operating the system for
processing licence applications
278,367.77 798,976.01(1)
1,699,030.39
Total: 6,474,846.42 10,030,724.11 15,046,047.95
(1)
Given the use of 2 bounds in the calculation of the estimated costs of processing licence applications, the middle
scenario presented here is an average of the lower and upper bounds in the middle scenario.
4.2. Costs for entities carrying out interest representation activities on behalf of
third countries
In line with the detailed assessment of the practical implications of the proposed policy options
presented, the following main cost types are relevant to entities conducting interest
representation activities across the 3 policy options.
• Familiarisation costs: It is assumed that all entities in the impacted sectors will need
to spend time familiarising themselves with the new requirements, even if only to
determine that they are out of scope. As such, the familiarisation costs will apply to all
commercial and non-commercial entities carrying out interest representation activities,
not just those operating on behalf of third countries. It is assumed that such costs will
occur once per entity.
For policy options 2.1 and 2.2, these costs will result directly from the proposed EU
intervention and will be the same for both options. For policy option 1, no costs will
stem directly from the recommendations proposed. However, costs will be incurred
indirectly by such entities, due to the need to familiarise themselves with measures
implemented independently by Member State authorities as a result of the
recommendations under option 1.
• Registration and information update costs: Depending on whether a transparency
register for interest representation or lobbying already exists in a Member State, entities
that are within scope will need to either: i) update information on their existing
registration; or ii) register for the first time. While it is assumed that all relevant entities
are already registered in Member States with existing registers, this is likely not the
case in practice. Across the national-level stakeholders interviewed for the supporting
study (including public authorities, service providers and representative associations),
there was limited insight into compliance rates, while insufficient monitoring and
enforcement activities, as well as the voluntary nature and limited scope of some
regimes mean that existing registers almost certainly do not capture all relevant entities.
Beyond these initial costs, borne in year 1, there will be a need for entities within scope
to regularly ensure the information is correct and submit any additional information on
material changes to the circumstances of the interest representation activities they carry
out on behalf of third countries. According to feedback from service providers, different
approaches are taken across industry and across different registers regarding the
frequency of such checks and updates. For instance, within the context of the EU
Transparency Register, commercial entities interviewed for the supporting study have
reported conducting updates once a year or quarterly, in both cases supplemented by ad
hoc updates whenever they begin representing new interests. These costs will be borne
on an annual basis across years 2-10.
As discussed further below, there may be some synergies in this context that could
reduce the costs associated with regular information provision, through the submission
122
of the same information across multiple registers and/or through business as usual
(BaU) costs linked to existing information provision obligations.
The nature and scale of these costs in this regard are largely similar across policy
options 2.1 and 2.2; the key difference being the requirement to self-declare compliance
with the record-keeping obligations (see below) on an annual basis. For policy option
1, entities within scope will face no direct costs; however, entities will likely face
indirect costs stemming from the implementation of measures by Member State
authorities adopted in accordance with the Commission’s recommendations. The scale
of these costs and the potential synergies due to improved harmonisation of rules will
depend on the nature and scale of the adoption of provisions recommended by the
Commission.
• Record-keeping costs: Entities within scope will be required to keep, for a reasonable
period, information on the identity of the third country entity whose interests they are
representing, a description of the purpose of the interest representation activity,
contracts and key exchanges with the third country entity. As above, the provisions and
related costs under policy options 2.1 and 2.2 are largely similar, while the costs under
option 1 depend heavily on the nature and scale of the measures implemented by
Member State authorities.
In addition to the above cost types, which are relevant across all policy options, the following
2 cost types are only relevant in the case of policy option 2.2:
• Prior authorisation / licencing costs: The information requirements necessary to
obtain a licence, and thus the direct costs of the licencing application, would be the
same as those noted above. However, as noted by industry stakeholders interviewed for
the supporting study, the licencing system could have indirect costs for entities with
scope stemming from the additional time taken to process a licence application.
Beyond these core costs, entities carrying out interest representation activities on behalf of third
countries may be subject to additional costs across all options stemming from: i) administrative
sanctions; ii) registration fees; and iii) potential loss of business from decisions taken by such
entities not to work with third countries due to the possible reputational impact. In addition,
under policy options 2.1 and 2.2, entities subject to the risk-based approach will face further
information disclosure costs when they either receive particularly high amounts from a third
country or third country entity or carry out interest representation on behalf of a third country
that has spent a significant amount in a Member State or the Union as a whole. However, it
was not possible to quantify these costs.
For each policy option and cost type, the following sections present the available evidence,
calculations, assumptions, and limitations / caveats.
4.2.1. Policy option 1: Non-legislative measures
The cost implications of policy option 1 will not stem directly from the Commission
recommendations, but will result from any measures implemented by Member State authorities
as a result of the recommendations. However, the nature and scale of the costs will depend
significantly on the extent to which the Member States implement the measures recommended,
the extent to which the measures implemented are consistent and coherent across the EU, as
well as the Member States in which the entities operate.
In this context, as under policy option 2.1, the main costs these stakeholders would potentially
be required to conduct will include:
123
• Familiarisation activities. As for Member State authorities, all entities conducting
interest representation activities would need to familiarise themselves with the
measures implemented in the Member State(s) in which they operate. This would apply
at a basic level to all entities conducting interest representation (i.e. to determine
whether they are within scope) and to a greater extent for those entities within scope of
the measures (i.e. to determine compliance strategies).
• Ensuring compliance with the provisions stipulated in the national-level measures,
including registration and information update requirements and record-keeping
obligations. As detailed further under policy option 2.1, in Member States where
transparency registers are developed or amended to cover third country interest
representation activities, entities carrying out such activities would likely be required
to: i) provide relevant information on these activities; and ii) ensure that information is
updated and remains accurate. Furthermore, where record-keeping obligations are
introduced, entities within scope would be required to ensure their processes and
systems are sufficient to ensure the retention of relevant information.
Beyond the costs linked to the practical implications of the measures, as described above,
additional costs could stem from registration fees and fines for non-compliance.
4.2.1.1. Scenario 1: Full take-up of the non-legislative measures
As for the Member State authorities, it is difficult to concretely assess the scale of the costs of
policy option 1 to entities carrying out interest representation. However, if implemented to the
extent where the provisions across the Member States are similar enough to contribute to the
stated aims of the intervention, the costs and benefits would be largely similar to those
documented under policy option 2.1.
The following table presents a summary of the maximum costs to interest representation
entities over a 10-year time horizon under scenario 1.
Table 18: Policy option 1 – Summary of maximum costs to interest representation entities
(over 10 years) under Scenario 1 (Full take-up of the non-legislative measures)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Basic familiarisation
costs
71,165,916.06 142,338,950.84 213,519,104.36
Extended familiarisation
costs
56,949.82 142,374.54 256,274.18
Registration and
information disclosure
costs
6,142,119.10 7,677,648.90 9,213,178.70
Record-keeping costs Business as usual (BaU) – No incremental costs
Other costs (incl. admin
sanctions, registration
fees)
No total cost estimates possible due to lack of evidence on
possible frequency and actual scale of fines.
Total: 77,364,984.98 150,158,974.28 222,988,557.24
4.2.1.2. Scenario 2: 50% take-up of the non-legislative measures
Under the assumptions detailed above in section 4.1.1.1 and 4.1.1.2., the direct costs for entities
conducting interest representation over the 10-year time horizon are summarised in the below
124
table. However, should these firms operate cross-border where one country has implemented
the measures and one country has not, they will face additional costs due to these
inconsistencies.
Table 19: Policy option 1 – Summary of maximum costs to interest representation entities
(over 10 years) under Scenario 2 (50% take-up of the non-legislative measures)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Basic familiarisation
costs
35,582,958.03 71,169,475.42 106,759,552.18
Extended familiarisation
costs
28,474.91 71,187.27 128,137.09
Registration and
information disclosure
costs
3,071,059.55 3,838,824.45 4,606,589.35
Record-keeping costs Business as usual (BaU) – No incremental costs
Other costs (incl. admin
sanctions, registration
fees)
No total cost estimates possible due to lack of evidence on
possible frequency and actual scale of fines.
Total: 38,682,492.49 75,079,487.14 111,494,278.62
4.2.2. Policy option 2.1: Targeted legislative intervention
In line with the categorisation of costs, the below table summarises the nature of the different
costs to entities carrying out interest representation activities on behalf of third countries that
are relevant within policy option 2.1.
Table 20: Policy option 2.1 – Summary of costs to interest representation entities within
scope
Cost items – Interest
representation service
providers
One-off
vs.
recurren
t
Type
Frequen
cy
Service providers
covered
Basic familiarisation
costs
One-off
Implementati
on
Year 1 Out of scope entities
Extended
familiarisation costs
One-off
Implementati
on
Year 1 In scope entities
Initial registration
costs & new
registrations per year
One-off
Administrativ
e
Year 1
Years 2-
10
In scope entities in MS
without register
Initial information
update costs
One-off
Administrativ
e
Year 1
In scope entities in MS
with register
Regular information
provision
Recurren
t
Administrativ
e
Years 2-
10
In scope entities
Establishing record-
keeping processes
One-off
Implementati
on
Year 1 In scope entities
Implementing record-
keeping processes
Recurren
t
Implementati
on
Years 1-
10
In scope entities
125
4.2.2.1. Familiarisation costs
Basic familiarisation costs will be borne by all entities conducting interest representation
activities in the EU, as it is assumed that each entity conducting activities covered by the
intervention will need to assess whether its operations are in scope. In addition, it is assumed
that entities conducting interest representation activities that are within scope will need to
conduct extended familiarisation activities, as follows:
• Basic familiarisation costs: This will require a large number of entities to spend a
small amount of time reviewing the legislative text and any related guidance. It is
assumed that all entities conducting interest representation activities, minus those
entities within scope, will conduct only this basic familiarisation. 3 scenarios have been
developed based on the assumed time spent by a legal professional. As detailed in Table
22, the scenarios assume that the time spent on basic familiarisation costs is 30 minutes
(low scenario), 1 hour (middle scenario) or 1.5 hours (high scenario). In these scenarios,
the total costs across all entities would range from approximately EUR 71.2 – 213.8
million at around EUR 20–60 per organisation.
• Extended familiarisation costs: This will require a much smaller number of entities
(i.e. those within scope of the proposed legislative intervention) to spend more time
reviewing the legislative text and any related guidance, but also to assess the practical
implications, develop compliance strategies and allocate responsibility for compliance-
related tasks. Table 23 presents 3 scenarios for these costs: 2 hours (low scenario),
4 hours (middle scenario) and 6 hours (high scenario). The associated costs would range
from approximately EUR 57–256 thousand at around EUR 80–240 per organisation.
On this basis, the total familiarisation costs across the 3 scenarios are summarised below. An
approximate total of EUR 71.2 million to EUR 213.8 million worth of resource will be spent
on familiarisation for this proposed intervention. It is assumed that the familiarisation costs are
the same across all policy options.
Table 21: Summary of familiarisation cost estimates
Cost type Low scenario (in
EUR)
Middle scenario (in
EUR)
High scenario (in
EUR)
Basic familiarisation
costs
71,165,916.06 142,338,950.84 213,519,104.36
Extended
familiarisation costs
56,949.82 142,374.54 256,274.18
Total familiarisation
costs
71,222,865.88 142,481,325.39 213,775,378.54
126
Table 22: Estimated basic familiarisation costs: Interest representation entities out of scope of the proposed intervention
Country ISCO 2
income:
EUR per
hour(1)
Number of entities (total interest representatives
– non-EU/EEA interest representatives)
Cost scenarios in EUR (number of entities * time spent * ISCO 2 income)
Low
scenario
Middle
scenario
High scenario Low scenario (30
mins)
Middle scenario (1
hour)
High scenario (1.5
hours)
Austria 42.18 118,251 118,256 118,262 2,493,718.33 4,987,686.10 7,481,903.32
Belgium 50.42 117,411 117,417 117,423 2,960,209.35 5,920,714.81 8,881,516.38
Bulgaria 7.25 14,183 14,183 14,184 51,408.22 102,821.57 154,240.07
Croatia 13.62 28,286 28,287 28,288 192,647.04 385,313.36 577,998.94
Cyprus 25.76 6,546 6,546 6,547 84,308.01 168,624.46 252,949.34
Czechia 17.07 96,020 96,025 96,030 819,324.08 1,638,730.13 2,458,218.12
Denmark 50.23 101,415 101,420 101,425 2,547,184.04 5,094,622.88 7,642,316.51
Estonia 16.91 23,774 23,775 23,776 200,993.58 402,007.26 603,041.05
Finland 41.02 109,432 109,438 109,443 2,244,430.12 4,489,084.76 6,733,963.90
France 44.06 1,298,467 1,298,532 1,298,597 28,603,532.66 57,209,926.52 85,819,181.60
Germany 46.81 628,783 628,815 628,846 14,715,668.41 29,432,808.83 44,151,421.25
Greece 21.74 6,792 6,792 6,793 73,841.50 147,690.38 221,546.65
Hungary 12.16 63,888 63,891 63,894 388,345.59 776,730.02 1,165,153.30
Ireland 48.08 33,813 33,815 33,816 812,847.40 1,625,776.11 2,438,786.13
Italy 42.39 369,680 369,699 369,717 7,835,048.81 15,670,881.37 23,507,497.66
Latvia 13.60 11,901 11,902 11,903 80,955.62 161,919.34 242,891.15
Lithuania 11.81 14,809 14,809 14,810 87,455.19 174,919.13 262,391.82
Luxembourg 46.01 8,692 8,693 8,693 199,973.84 399,967.68 599,981.52
Malta 20.30 2,927 2,927 2,927 29,711.53 59,426.03 89,143.51
Netherlands 41.76 48,439 48,442 48,444 1,011,529.98 2,023,161.14 3,034,893.49
Poland 13.19 74,155 74,158 74,162 489,026.02 978,100.96 1,467,224.81
Portugal 20.77 68,744 68,748 68,751 713,751.15 1,427,573.69 2,141,467.64
Romania 12.92 61,679 61,683 61,686 398,458.73 796,957.31 1,195,495.75
Slovakia 14.27 20,192 20,193 20,194 144,105.17 288,224.75 432,358.75
Slovenia 19.51 26,723 26,724 26,726 260,668.36 521,362.80 782,083.31
Spain 29.59 101,532 101,537 101,542 1,501,991.15 3,004,132.55 4,506,424.19
Sweden 43.10 103,236 103,241 103,246 2,224,782.18 4,449,786.90 6,675,014.17
Total 3,559,770 3,559,948 3,560,126 71,165,916.06 142,338,950.84 213,519,104.36
(1)
EU wage tariffs: Hourly earnings 2018 plus non-wage labour costs (NWLC) and 25% overheads (OH), per Member State and ISCO (International Standard Classification of Occupations)
category, last updated January 2021. ISCO 2 covers professionals, including legal, social and cultural professionals.
127
Table 23: Estimated extended familiarisation costs: Interest representation entities within scope of the proposed intervention
Country ISCO 2
income:
EUR per
hour(1)
Number of entities (total interest representatives
– non-EU/EEA interest representatives)
Cost scenarios in EUR (number of entities * time spent * ISCO 2 income)
Low
scenario
Middle
scenario
High scenario Low scenario (2 hrs) Middle scenario (4 hrs) High scenario (6 hrs)
Austria 42.18 24 30 35 1,995.57 4,988.93 8,980.08
Belgium 50.42 23 29 35 2,368.88 5,922.20 10,659.95
Bulgaria 7.25 3 4 4 41.14 102.85 185.13
Croatia 13.62 6 7 8 154.16 385.41 693.74
Cyprus 25.76 1 2 2 67.47 168.67 303.60
Czechia 17.07 19 24 29 655.66 1,639.14 2,950.45
Denmark 50.23 20 25 30 2,038.36 5,095.90 9,172.61
Estonia 16.91 5 6 7 160.84 402.11 723.79
Finland 41.02 22 27 33 1,796.08 4,490.21 8,082.37
France 44.06 260 325 390 22,889.69 57,224.23 103,003.62
Germany 46.81 126 157 189 11,776.07 29,440.17 52,992.30
Greece 21.74 1 2 2 59.09 147.73 265.91
Hungary 12.16 13 16 19 310.77 776.92 1,398.46
Ireland 48.08 7 8 10 650.47 1,626.18 2,927.13
Italy 42.39 74 92 111 6,269.92 15,674.80 28,214.64
Latvia 13.60 2 3 4 64.78 161.96 291.53
Lithuania 11.81 3 4 4 69.99 174.96 314.93
Luxembourg 46.01 2 2 3 160.03 400.07 720.12
Malta 20.30 1 1 1 23.78 59.44 106.99
Netherlands 41.76 10 12 15 809.47 2,023.67 3,642.60
Poland 13.19 15 19 22 391.34 978.35 1,761.02
Portugal 20.77 14 17 21 571.17 1,427.93 2,570.28
Romania 12.92 12 15 19 318.86 797.16 1,434.88
Slovakia 14.27 4 5 6 115.32 288.30 518.93
Slovenia 19.51 5 7 8 208.60 521.49 938.69
Spain 29.59 20 25 30 1,201.95 3,004.88 5,408.79
Sweden 43.10 21 26 31 1,780.36 4,450.90 8,011.62
Total 712 890 1,068 56,949.82 142,374.54 256,274.18
(1)
EU wage tariffs: Hourly earnings 2018 plus non-wage labour costs (NWLC) and 25% overheads (OH), per Member State and ISCO (International Standard Classification of Occupations)
category, last updated January 2021. ISCO 2 covers professionals, including legal, social and cultural professionals.
128
4.2.2.2. Registration and information update costs
The second cost type examined is the need for entities within scope to conduct initial
activities to either: i) register; or ii) update or add information to an existing registrant
profile. In both cases, this cost type will be one-off and occur in year 1 of the proposed
intervention. The nature of the practical changes required for each entity conducting
interest representation activities within scope would depend on:
• Whether a transparency register for interest representation or lobbying already
exists in an entity’s Member State(s) of operation; and
• In Member States with existing transparency registers, whether such entities are
already registered.
Considering the first point, the below table summarises the situation as regards existing
Member State legal regimes / registers, and the type of action entities carrying out interest
representation activities will need to take in each country.
Table 24: Overview of Member State legal frameworks and resulting compliance
activities under the proposed policy options
Country
Current legal framework
Immediate activities required
by entities within scope
Existin
g law(1)
Existi
ng
regist
er
Existing
monitoring &
enforcement
regime
Initial
Registration
Information
update
Austria X X X X
Belgium X (2)
X
Bulgaria X
Croatia X
Cyprus X X X X
Czechia X
Denmark X
Estonia X
Finland X X X
France X X X X
Germany X X X X
Greece X X X X
Hungary X X
Ireland X X X X
Italy X X
Latvia X
Lithuania X X X X
Luxembou
rg
X X X X
Malta X X
Netherland
s
X X X
Poland X X X X
Portugal X
Romania X X X
Slovakia X
Slovenia X X X X
129
Spain X X X X
Sweden X
Total 16 MS 15 MS 12 MS 12 MS 15 MS
(1)
In addition to the existing laws, the legal and policy mapping conducted for the supporting study identified
that relevant laws are in development in 11 Member States (BE, BG, CZ, IE, IT, LV, MT, NL, PL, SK, ES).
(2)
While a register exists in BE, there is currently no IT tool; instead, the register is published as a PDF
document. As such, it is assumed that the BE authorities would need to develop a new IT tool.
The differentiation of impacts based on the second point (i.e. the number of entities
carrying out interest representation activities within scope that are already registered) is
more challenging to assess. As highlighted above, interview feedback from national-level
stakeholders interviewed for the supporting study (including public authorities, interest
representation providers and representative associations) demonstrated limited insight into
registration compliance rates across the EU, while the voluntary nature of registration in
some Member States (e.g. BE, IT, RO), the differences in scope across Member States
(e.g. no coverage of existing interest representation on behalf of third countries; coverage
of lobbying versus interest representation more broadly) and the wide variance in number
of registrants across Member States (e.g. 82 in SI and 84 in IT compared with 5,676 in DE
and 2,454 in IE), mean that it is not possible to estimate with any certainty the proportion
of entities conducting interest representation activities that are already registered. For those
entities that are operating on behalf of third countries, it is even more difficult.
As such, while this may not be the case in practice, it is assumed that all entities within
scope operating in a Member State with an existing register are already registered in that
country.
The characteristics of these 3 core costs are now described, before the data collected on
the scale of the costs is presented:
• Initial registration costs: In Member States that currently do not have existing
registers (i.e. 12 Member States), entities conducting interest representation
activities on behalf of third countries will be required to register.
• Initial information update costs: In Member States that currently maintain
existing registers, entities carrying out interest representation activities on behalf
of third countries will be required to update existing information to explicitly
disclose the third country interests they represent.
• Ongoing information disclosure costs: All entities conducting interest
representation activities on behalf of third countries will be required to ensure the
information submitted to registers across the Union is regularly updated and
remains accurate.
The costs related to both initial registration and updating of information will be
administrative, one-off costs, borne in year 1. The ongoing information disclosure costs
will be administrative in nature, but will be recurrent, borne annually in years 2-10. The
costs will take the form of human resources spent collecting and submitting the required
information (i.e. time of direct labour costs and related overheads). As for the
familiarisation costs, the EU wage tariffs, based on ISCO employee categories, have been
used to calculate the different costs associated with registration and information disclosure.
The following table presents the available evidence on the estimated scale of these costs.
130
Table 25: Costs associated with registration and updating information at the Union
and national levels
Evidence on the scale of the cost: Initial registration and information update costs
According to commercial and non-commercial entities conducting interest
representation activities interviewed for the supporting study, as well as their
representative associations, registration and information update activities require the
following tasks: i) the collection of relevant information through liaison between
different professionals (e.g. legal and compliance teams, delivery teams, board
members); ii) the submission of that information to the register/authorities through a
dedicated form/portal; and iii) any additional internal processes, such as staff training on
record-keeping and retrieval.
In line with the detailed explanation of policy option 2.1, entities within scope would be
required to provide the following types of information at initial registration:
• Information on the entity conducting interest representation activities, including
their name, contact details, category of organisation, address of place of
establishment.
• Information on the activities conducted, including the type of activity, the
Member State in which it will be conducted, the policy being targeted and the
remuneration received.
• Information on the third country entity on whose behalf the interest
representation is being conducted, including their name, contact details and the
third country.
The information update will only require submission of new information explicitly on
third country interests represented.
Most experiences discussed with interviewees in this regard referred to the EU
Transparency Register; however, experiences of registration and information update
procedures in Germany, Luxembourg, the Netherlands and Slovenia were also shared.
In general, there was a consensus across these stakeholders that the processes of
registration and information disclosure place a minimal burden on these entities.
However, the following complexities and considerations were highlighted by
stakeholders:
• It is often difficult to determine the extent to which certain activities are within
scope and thus what data (including financial data) needs to be provided. For
instance, many commercial firms conduct legislative monitoring activities within
the context of broader engagements with clients.
• Mixed feedback was provided on the differentiation of impacts between larger
and smaller organisations. While larger consultancy firms noted that the
registration exercise is more burdensome for them, given the complexity of
collecting data on more clients, many stakeholders stated that the impact would
be proportionally higher on SMEs, who may not have the systems in place to
easily access the required information. Others noted that some firms rely on
software systems to track key information or outsource certain activities related
to these transparency obligations, while one commercial firm noted that the
administrative costs related to registration are built into their fees.
131
• Within the EU Transparency Register, there is also a need for commercial firms
to ensure their clients are registered. This is reported as being burdensome for
those firms and should be considered within the reading of the below figures.
Considering the time required to register and update the relevant information, estimates
from entities conducting interest representation activities focused on the following
elements:
• Registration / information provision only: Estimates ranged from 5 minutes to
register in Belgium to up to 1 hour to register in the EU Transparency Register.
• Overall annual cost of compliance: Quantitative estimates provided include 1-
2 weeks a year and approximately 10 days per year split equally between a
partner and an administrative staff member (in Belgium, this equates to around
EUR 3,500 per year), up to as much as EUR 40,000 per year to ensure
compliance with EU, national and regional registers over the course of a year
(e.g. for entities operating in Germany). However, qualitatively, other
stakeholders noted the light administrative burden associated with existing
transparency registers. Furthermore, given these estimates reflect information
disclosure related to all lobbying or interest representation activities conducted
by an organisation, or efforts across multiple registers, the costs for information
disclosure related to interest representation carried out on behalf of third
countries will likely be reduced. However, it is not possible to assess the scale of
this reduction.
In this context, 3 scenarios have been developed to assess the possible costs associated
with these information obligations. The low scenario assumes 2.5 days per year split
equally between one ISCO 1 (senior managers) and one ISCO 4 (clerks) category
employee. Using the same division of labour, the middle and high scenarios assume 5 days
and 10 days per year, respectively.
The following assumptions are also relevant in this context:
• Given the data available and their limited scale, the costs associated with the initial
act of registration is considered to be part of the overall annual cost of compliance,
which is assumed to be the same in year 1 as in the other years. As such, the
calculations use the annual cost of compliance as a proxy for the 3 different types
of costs noted above.
• While some organisations will experience synergies due to cross-border or multi-
national interest representation service provision, which will lead to cost-savings,
there is limited indication of the scale of multi-national or cross-border interest
representation (in general or for third countries). Moreover, the scale of these
synergies will differ based on the nature of an organisation’s engagements with
such third countries. For instance, a commercial firm working with the same client
in multiple Member States will experience direct synergies with regard to both the
types of information to be provided and the specific information; however, a
commercial organisation working in multiple Member States but with different
clients will only benefit from synergies related to the types of information to be
provided.
With these caveats and assumptions established, the costs were calculated by multiplying
the number of working days by the relevant ISCO category wage for each country and the
estimated number of entities within scope (as per the above estimates). It is important to
note that, alongside the number of working days, the estimates for the number of entities
132
within scope also change across the 3 scenarios presented. This is primarily due to the way
in which the estimates for the number of entities conducting interest representation per
Member State were calculated (i.e. across 3 scenarios). More specifically, the low / middle
/ high scenarios for the number of entities are used in conjunction with the low / middle /
high estimates for the number of working days.
On this basis, the annual registration and information disclosure activities to be conducted
by entities carrying out interest representation activities on behalf of third countries will
cost between approximately EUR 590,000 and EUR 3.5 million at approximately EUR
828 – 3,314 per organisation. Across the 10-year time horizon, this will reach a total cost
of approximately EUR 5.9 and EUR 35.4 million. The detailed breakdown of the annual
cost estimates per Member State is presented in the below table.
Table 26: Estimated registration and information disclosure costs
Country
Low scenario (2.5
days)
Middle scenario (5
days)
High scenario (10 days)
ISCO 1
1.25
days
ISCO 4
1.25
days
ISCO 1
2.5 days
ISCO 4
2.5 days
ISCO 1
5 days
ISCO 4
5 days
Austria
14,717.3
5 6,630.45 36,793.38
16,576.1
3 88,304.12 39,782.72
Belgium
15,195.0
6 6,478.72 37,987.64
16,196.8
0 91,170.34 38,872.32
Bulgaria 320.39 118.08 800.98 295.21 1,922.36 708.50
Croatia 1,037.22 504.41 2,593.06 1,261.04 6,223.34 3,026.49
Cyprus 629.17 165.89 1,572.93 414.71 3,775.03 995.31
Czechia 4,940.41 2,030.04 12,351.03 5,075.09 29,642.48 12,180.22
Denmark
15,036.4
4 7,983.77 37,591.11
19,959.4
2 90,218.66 47,902.61
Estonia 997.03 525.43 2,492.59 1,313.58 5,982.21 3,152.59
Finland
15,089.4
5 5,753.13 37,723.62
14,382.8
3 90,536.68 34,518.79
France
152,485.
04
68,233.5
5
381,212.5
9
170,583.
86 914,910.23 409,401.27
Germany
94,325.6
1
36,454.5
4
235,814.0
4
91,136.3
5 565,953.69 218,727.23
Greece 430.92 193.23 1,077.30 483.06 2,585.51 1,159.36
Hungary 2,197.30 1,011.99 5,493.25 2,529.98 13,183.81 6,071.96
Ireland 3,390.30 1,830.08 8,475.74 4,575.20 20,341.78 10,980.48
Italy
54,990.9
2
17,792.3
2
137,477.2
9
44,480.8
0 329,945.50 106,753.91
Latvia 422.62 205.78 1,056.55 514.46 2,535.72 1,234.71
Lithuania 473.89 224.91 1,184.73 562.29 2,843.34 1,349.49
Luxembou
rg 1,209.24 514.62 3,023.10 1,286.54 7,255.44 3,087.70
Malta 158.79 79.83 396.99 199.57 952.77 478.96
Netherland
s 5,439.20 2,623.80 13,598.00 6,559.50 32,635.19 15,742.80
Poland 2,629.37 1,090.84 6,573.44 2,727.10 15,776.25 6,545.03
Portugal 4,141.43 1,402.05 10,353.58 3,505.12 24,848.58 8,412.28
Romania 1,953.51 785.63 4,883.78 1,964.08 11,721.08 4,713.79
133
Country
Low scenario (2.5
days)
Middle scenario (5
days)
High scenario (10 days)
ISCO 1
1.25
days
ISCO 4
1.25
days
ISCO 1
2.5 days
ISCO 4
2.5 days
ISCO 1
5 days
ISCO 4
5 days
Slovakia 888.66 392.66 2,221.64 981.66 5,331.94 2,355.97
Slovenia 1,623.75 685.78 4,059.37 1,714.44 9,742.49 4,114.66
Spain 8,326.99 3,713.02 20,817.48 9,282.55 49,961.95 22,278.12
Sweden
13,080.7
4 6,465.68 32,701.86
16,164.2
0 78,484.45 38,794.07
Total per
category:
416,130.
82
173,890.
23
1,040,327.
06
434,725.
57
2,496,784.
94
1,043,341.
36
Total cost: 590,021.05 1,475,052.63 3,540,126.31
Moreover, in line with the above considerations, it is assumed that the size of the entity
impacts the scale of the effort required to conduct the required annual information
disclosure tasks. The data on full-time equivalents (FTE) working on interest
representation activities from the EU Transparency Register illustrates that, while the
number of reported FTEs reaches a maximum of 85.5 FTEs and a total of 17,882 FTEs,
the mean (2 FTEs), median (1 FTE) and mode (0.25 FTEs) are all significantly lower. On
this basis, tailored definitions for micro / small (<10 FTEs), medium (10-19 FTEs) and
large (>=20 FTEs) entities were assumed in this context. The data are presented in the
below table.
Table 27: Estimated number of entities per size class (EU Transparency Register)
Size classification &
rationale
Number of entities Percentage of entities
Micro / Small (<10 FTEs) 8,562 97.3%
Medium (10-19 FTEs) 175 2.0%
Large (>=20 FTEs) 59 0.7%
Total 8,796 100%
To achieve more nuanced estimates of the costs based on firm size, the rationale was used
that the larger the firm, the more complex and costly the reporting process to assume that:
micro / small entities require 2.5 days to comply with the foreseen information disclosure
and reporting requirements; medium-sized entities require 5 days; and large entities require
10 days. These estimates are in line with the 3 scenarios for the number of working days
calculated above.
Under these assumptions, the costs were calculated by applying the above entity-size
percentages to the 3 scenarios for the estimated number of entities carrying out interest
representation activities on behalf of third countries. These proportions were then
multiplied by the average cost per organisation across the EU-27 per scenario (i.e. low,
middle, high). For instance, as shown in the first of the below tables, approximately 693
of the 712 estimated entities conducting interest representation on behalf of third countries
across the EU-27 are micro / small entities, while 14 are medium-sized and 5 are large.
The same breakdown of entities by size class has been done for the middle and high
scenarios for the number of entities within scope.
Table 28: Estimated number of entities per size class, per scenario
Number of
entities
(scenarios)
Micro / Small
(97.3%)
Medium (2%) Large (0.7%) Total
134
On this basis, the following table illustrates the calculated costs per entity size class. These
calculations suggest that, in practice across the 3 scenarios, the estimated total costs will
sit somewhere between EUR 614,000 and EUR 921,000 at an average cost per entity of
EUR 862.45. Across the 10-year time horizon, total costs will reach approximately EUR
6.1 mn to EUR 9.2 mn.
Table 29: Estimated costs per entity size class, per scenario per year
Number of entities
(scenarios)
Micro /
Small
(97.3%)
Medium
(2%)
Large
(0.7%)
Total
Low scenario (# of
entities)
574,090.48 23,600.84 16,520.59 614,211.91
Middle scenario (# of
entities)
717,613.10 29,501.05 20,650.74 767,764.89
High scenario (# of
entities)
861,135.72 35,401.26 24,780.88 921,317.87
Conversely, the table below provides a summary of the estimated average costs per entity
per information update scenario (i.e. 2.5 / 5 / 10 days). For the purpose of calculating the
average costs across the body of entities, it has been assumed that micro / small entities
experience the lower average costs (i.e. EUR 828.49), medium-sized firms experience the
middle average costs (i.e. EUR 1,656.97) and large firms experience the higher average
costs (i.e. EUR 3,313.94).
Table 30: Estimated average costs per entity, per size class
Micro /
Small
(97.3%)
Medium
(2%)
Large
(0.7%)
General average
costs across all
entities
Average total costs per
entity
828.49 1,656.97 3,313.94 862.45
4.2.2.3. Record-keeping costs
The third cost type examined is the need for entities within scope to ensure appropriate
record-keeping. This would include retaining, for a reasonable period: i) information on
the identity of the third country entity on whose behalf the interest representation activities
are being carried out; ii) a description of the purpose of the interest representation activity;
and iii) contracts and key exchanges with the third country entity to the extent that they are
essential to understand the nature and purpose of the interest representation carried out or
information or material constituting key components of the interest representation activity.
Beyond supporting the entities in their registration and information disclosure
requirements (see above), the purpose of this record-keeping is to ensure sufficient
transparency is possible in response to possible supervision or enforcement requests.
Low scenario (#
of entities)
693 14 5 712
Middle scenario
(# of entities)
866 18 6 890
High scenario (#
of entities)
1,039 21 7 1,068
135
In this context, entities within scope will need to: i) establish the processes and systems to
identify and securely retain key information (one-off in year 1); and ii) implement those
processes and systems to ensure the continued identification and retention of that
information over the remainder of the time horizon (recurrent in years 2-10).
However, given the existing importance of this information to the provision of services by
entities within scope, it is assumed that the costs of formalising such record-keeping
obligations in this context could be characterised as business as usual (BaU) costs, thereby
adding no incremental costs to the intervention.
4.2.2.4. Other costs (e.g. administrative sanctions, risk-based
approach, etc.)
Beyond these core costs, there are a range of additional costs that could be incurred by
entities within scope depending on the implementation specifics. These include
i) administrative sanctions; ii) registration fees; iii) costs related to the risk-based approach.
Each additional cost item is briefly discussed here.
The proposed administrative sanctions regime within policy option 2.1 would allow the
imposition of fines on non-compliant interest representation service providers. However,
it was not possible to estimate the scale or frequency of potential fines due to a lack of
available data on breaches of existing interest representation transparency registers and
related sanctions at the national level, twinned with challenges regarding the adequacy of
monitoring and enforcement resources and activities across the Member States.
In addition, while not explicitly included (or excluded) in policy option 2.1, Member States
may impose registration fees on entities within scope. This is a practice that already
occurs in some Member States (e.g. in Slovenia). However, it has not been possible to
ascertain the number of Member States that would implement such a registration fee, nor
the size of such fees. As such, it has not been possible to quantitatively assess this cost
item.
The final cost item to note in relation to policy option 2.1 relates to the risk-based
approach proposed. Under this option, entities will be required to provide, at the request
of national independent supervisory authorities, the records kept on certain interest
representation activities (as detailed above). This may be necessary under 2 scenarios: i)
when the entity has received a particularly high amount from a particular third country; or
ii) when the entity is carrying out interest representation activities on behalf of a third
country that has spent a significant amount on interest representation across the Union as
a whole. However, it has not been possible to assess the extent to which entities within
scope would be subject to such requests for records, primarily due to limited quantitative
data available on the scale of interest representation conducted on behalf of third countries
across the EU. As such, it has not been possible to quantify this cost item.
4.2.2.5. Summary of costs under policy option 2.1: Entities within
scope
In total, the estimated incremental costs of policy option 2 to entities conducting
interest representation activities on behalf of third countries over a 10-year time
horizon can be summarised as follows:
136
Table 31: Policy option 2.1 – Summary of total costs to interest representation entities
within scope (over 10-years)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Basic familiarisation
costs
71,165,916.06 142,338,950.84 213,519,104.36
Extended
familiarisation costs
56,949.82 142,374.54 256,274.18
Registration and
information disclosure
costs
6,142,119.10 7,677,648.90 9,213,178.70
Record-keeping costs Business as usual (BaU) – No incremental costs
Other costs (incl. admin
sanctions, registration
fees)
No total cost estimates possible due to lack of evidence on
possible frequency and actual scale of fines.
Total: 77,364,984.98 150,158,974.28 222,988,557.24
4.2.3. Policy option 2.2: Extended legislative intervention
The description of the policy options and the categorisation of costs highlights that many
of the costs borne under policy option 2.1 by interest representation entities within scope
will also be relevant under policy option 2.2. Concretely, this includes:
• Basic and extended familiarisation costs: While the provisions of the
interventions under option 2.1 and 2.2 will be different, it is assumed that the time
taken for familiarisation, as well as the population of entities impacted is the same
for both options. Thus, the cost of both the basic and extended familiarisation
activities will be the same under policy option 2.2 and under policy option 2.1.
• Registration and information update costs: The registration and information
disclosure obligations under policy option 2.2 remain the same as under option 2.1.
Therefore, the costs will also be the same.
• Record-keeping costs: While there are some subtle differences between the
record-keeping requirements under policy options 2.1 and 2.2, they are in practice
largely similar in nature. Moreover, as for policy option 2.1, these obligations could
be characterised as BaU costs due to the existing importance of the information to
be retained.
• Other costs: Entities within scope could be subject to further costs related to
administrative sanctions for non-compliance, registration/application fees and
additional information disclosure under the risk-based approach. For the reasons
stated under option 2.1, it has not been possible to quantify these other costs.
Beyond these costs, however, entities within scope will face additional costs under policy
option 2.2 that would not be borne under option 2.1. These include due costs related to the
prior authorisation / licencing system.
The below table summarises the nature of the different costs to entities carrying out interest
representation activities on behalf of third countries that are relevant within policy option
2.2.
137
Table 32: Policy option 2.2 – Summary of costs to interest representation entities
within scope
Cost items – Interest
representation service
providers
One-off
vs.
recurrent
Type
Frequen
cy
Service providers
covered
Basic familiarisation
costs
One-off
Implementati
on
Year 1
Out of scope
entities
Extended
familiarisation costs
One-off
Implementati
on
Year 1 In scope entities
Initial registration
costs & new
registrations per year
One-off
Administrati
ve
Year 1
Years 2-
10
In scope entities in
MS without
register
Initial information
update costs
One-off
Administrati
ve
Year 1
In scope entities in
MS with register
Regular information
provision
Recurrent
Administrati
ve
Years 2-
10
In scope entities
Establishing record-
keeping processes
One-off
Implementati
on
Year 1 In scope entities
Implementing record-
keeping processes
Recurrent
Implementati
on
Years 1-
10
In scope entities
Prior authorisation /
licencing
One-off
Administrati
ve
Year 1 In scope entities
Given the costs for the first 3 overarching categories are the same as in policy option 2.1,
the focus in this section is on the costs stemming from the prior authorisation / licencing
system.
4.2.3.1. Prior authorisation/licensing system
Under the prior authorisation / licencing system, entities carrying out interest
representation activities on behalf of third countries with the objective of influencing a
public decision-making process would be required to apply at the Member State level for
an EU-wide licence to conduct such interest representation activities.
Within the application for a licence, entities within scope would be required to submit the
same information as under the registration obligations of policy option 2.1. Thus, while
this could lead to hassle costs (e.g. from delaying the provision of services), the core
activities, and direct costs, stemming from the prior authorisation / licencing system would
be covered by the registration and information update costs detailed above.
The Better Regulation Toolbox categorises hassle costs as direct costs of regulation, stating
that “hassle costs are often interpreted as ‘regulatory annoyance’ resulting from
unnecessary waiting time, delays, redundant legal provisions, corruption, etc.”, further
noting that “as this category of costs is not well-defined, in most cases it is not analysed in
impact assessments, evaluations and fitness checks”.
In line with this description, the hassle costs identified within the context of PO2.2 are
difficult to define such that quantification is possible. The primary cost foreseen is
‘delaying the provision of services’ due to having to wait for a licence to be granted.
While this should not prevent an entity from conducting other economic activity as it waits,
it could ultimately delay payment for the services to be delivered, or even impact the
business relationship with the third country on whose behalf the entity is conducting
interest representation activities. However, it is not possible to quantify these costs.
138
Nonetheless, the system may have an indirect economic impact on entities within scope
that it is not possible to quantify. While registration is necessary under option 2.1, it is a
simple process with activities only required by the entities within scope before they can
obtain a registration number and conduct interest representation activities on behalf of third
countries. Contrastingly, the prior authorisation system to be implemented under policy
options 2.2 also requires activities from national authorities – i.e. to assess an application
and grant (or not) a licence to operate. The time taken from submitting an application to it
being granted could negatively impact the economic capacity of the entity, for instance
resulting in a concentration of contracts with entities that are already registered.
4.2.3.2. Summary of costs under policy option 2.2: Entities within
scope
In total, the estimated incremental costs of policy option 2.2 to entities conducting
interest representation activities on behalf of third countries over a 10-year time
horizon can be summarised as follows:
Table 33: Policy option 2.2 – Summary of total costs to interest representation entities
within scope (over 10-years)
Cost item
Low scenario
(EUR)
Middle scenario
(EUR)
High scenario
(EUR)
Basic familiarisation
costs
71,165,916.06 142,338,950.84 213,519,104.36
Extended familiarisation
costs
56,949.82 142,374.54 256,274.18
Registration and
information disclosure
costs
6,142,119.10 7,677,648.90 9,213,178.70
Record-keeping costs Business as usual (BaU) – No incremental costs
Other costs (incl. admin
sanctions, registration
fees)
No total cost estimates possible due to lack of evidence on
possible frequency and actual scale of fines.
Prior authorisation /
licencing
Covered through the registration and information update
costs (above)
Total: 77,364,984.98 150,158,974.28 222,988,557.24
5. Potential administrative simplification and costs savings
An analysis on the scale of potential administrative simplification and cost savings for
entities conducting interest representation on behalf of third countries requires an
assessment of: i) how the registration and information disclosure costs could decrease as
an entity enters additional Member State markets; and ii) how these cost savings can be
applied to the overall population of entities potentially working cross-border. This section
first sets out the key information on this issue from the report, before discussing these
additional analytical tasks.
The report presents the following information of relevance to this aim:
• Provides estimates for the potential population of entities conducting interest
representation activities on behalf of third countries in the Union as well as an
estimate of the proportion of entities within scope that operate cross-border.
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• Indicates that entities are required to conduct the following tasks to meet the
registration and information disclosure obligations: “i) the collection of relevant
information through liaison between different professionals (e.g. legal and
compliance teams, delivery teams, board members); ii) the submission of that
information to the register/authorities through a dedicated form/portal; and iii)
any additional internal processes, such as staff training on record-keeping and
retrieval.”
• Notes that entities working cross-border will likely experience cost savings related
to these tasks.
• Highlights the challenges associated with quantifying cost savings in this context:
o Limited evidence exists on the scale and nature of cross-border interest
representation, including how many entities work cross-border and, where
they do work cross-border, in how many and in which Member States.
o Limited evidence on the scale and nature of the synergies that entities will
experience due to the implementation of harmonised rules across the Union
when operating cross-border.
o Limited evidence on the granular breakdown of costs stemming from
registration and information disclosure compliance tasks. While estimates
have been provided by entities for the overall time/cost spent on compliance
with registration and information disclosure obligations, this was not
broken down by the specific tasks conducted (e.g. liaising with different
professionals internally to collect relevant information, the act of
submitting the information).
o The fact that the costs under the baseline scenario differ based on whether
a Member State already has a register. For instance, currently, entering a
new market might not bring any additional registration and information
disclosure costs.
On this basis, it should be clearly stated that any estimates of the scale of possible cost
savings are subject to an extensive set of assumptions based on limited concrete evidence
that limit the level of certainty in the accuracy and precision of the estimates.
In terms of the cost savings, the key assumption in this context is that entities conducting
interest representation activities on behalf of third countries will experience synergies and
thus cost savings when they enter Member State markets outside their Member State of
establishment. More specifically, they will be subject to reduced administrative burden in
these additional Member States stemming from:
• The need to provide exactly the same information (i.e. when operating on behalf of
a given third countries in multiple Member States). In this scenario, the costs of
registration and information disclosure for additional Member States would be
limited solely to the submission of information as there would be no need to collect
additional information.
• The need to provide different information but for the same types of information
(i.e. when operating in different Member States on behalf of different third
countries). In this scenario, likely minor efficiency gains would be possible, for
instance, through the use of the same information recording and retrieval systems
across all Member States. However, entities would still be required to conduct the
same internal liaison and information collection tasks, as well as the information
submission tasks.
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Moreover, it is assumed that any additional costs stemming from other internal processes
noted by entities, such as staff training, can be considered as business-as-usual (BaU) costs.
While it is not anticipated that such costs would be significant, they would be borne in any
case when moving into a new Member State market.
To develop a quantitative estimate of the potential cost savings, one would need to generate
assumptions for: i) the costs associated with the granular tasks of liaison and information
collection, compared with the information submission; and ii) the extent to which entities
conducting interest representation activities on behalf of third countries would be subject
to each of the above categories of synergies.
However, in line with the above caveats and limitations, it has not been possible to find an
appropriate solution for generating these assumptions. Primarily, this is because the cost
estimates currently presented for registration and information disclosure are based on
evidence of the total compliance costs of entities conducting interest representation,
thereby already reflecting cross-border operations (or at least engagement with multiple
registers). As such, the cost estimates cannot be used as a basis on which to calculate the
cost savings because, in theory, they already reflect the identified synergies.
The summary of costs and benefits in Annex 3 therefore provides benefits only in a
qualitive way instead of a quantitative way.
6. Comparison of options and proportionality
Criterion Key Questions Indicators/Methods for
comparison
Effectiveness What would be the
(quantitative and
qualitative) effects of each
option?
Which policy option would
be most effective in
achieving the set
objectives of the current
initiative?
Comparison of expected
effectiveness of each policy
option against the
evaluation baseline
Comparison of expected
effectiveness of the policy
options against each other;
Identification of a preferred
option, where possible.
Efficiency What would be the
incurred costs and benefits
under each policy option?
To what extent will the
costs associated with the
intervention be
proportionate to the
benefits it is expected to
generate?
How proportionate will be
the costs of the
intervention borne by
different stakeholder
groups, taking into account
Comparison of potential
costs and benefits borne by
each stakeholder group
under each policy option;
Identification of a preferred
option, where possible.
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the distribution of
associated benefits?
Which policy option would
be most cost-effective?
Coherence To what extent is each
policy option coherent
with other relevant EU
initiatives?
To what extent is each
policy option coherent
with wider EU policy?
To what extent is each
option is contributing to
establish a coherent
framework by reducing the
legal fragmentation across
Member States?
Identification of overlaps
and/or synergies between
policy options and relevant
initiatives;
Identification of contrasts
and/or discrepancies
between policy options and
relevant initiatives;
Identification of a preferred
option, where possible.
Proportionality Does the initiative go
beyond what is necessary
to achieve the
problem/objective
satisfactorily?
Is the initiative limited to
those aspects that Member
States cannot achieve
satisfactorily on their own,
and where the Union can
do better?
Is the form of Union as
simple as possible, and
coherent with satisfactory
achievement of the
objective and effective
enforcement?
Does the initiative create
unjustified financial or
administrative cost for the
Union, national
governments, regional or
local authorities, economic
operators or citizens? Are
these costs commensurate
with the objective to be
achieved?
Does the Union action
leave as much scope for
Ensuring that the policy
approach and its intensity
match the identified
problem/objective.
142
national decision as
possible while achieving
satisfactorily the objectives
set?
While respecting Union
law, are special
circumstances applying in
individual Member States
taken into account?
The table in chapter 6 of the Impact Assessment should be read in vertical: ‘++’ means
positive impact of high magnitude compared to the baseline, ‘+’ means positive impact of
moderate magnitude compared to the baseline, ‘0’ means neutral impact compared to the
baseline, ‘-’ means negative impact of moderate magnitude compared to the baseline, ‘- -’
means negative impact of high magnitude compared to the baseline, ‘n.a’ means not
applicable.
This table summarises the impacts of each the options with regard to both legislative and
non-legislative measures considered. The table provides an overview of how the options
compare. The corresponding narrative sections provide explanations as to why which
option is considered better for each category.
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Annex 5: Competitiveness check
1. Overview of impacts on competitiveness
Dimensions of
competitiveness
Impact of the initiative
(++ / +/ 0 / - / --/ n.a.)
References to sub-sections of
the main report or annexes
Cost and price competitiveness + Sections 6.2.1.1, 6.2.1.2 & 6.2.1.3
Capacity to innovate 0 Section 6.2.1.2
International competitiveness 0 Section 6.2.4
SME competitiveness + Section 6.2.1.2
The table should be read in horizontally: ‘++’ means positive impact of high magnitude, ‘+’ means
positive impact of moderate magnitude, ‘0’ means neutral impact, ‘-’ means negative impact of
moderate magnitude, ‘- -’ means negative impact of high magnitude, ‘n.a’ means not applicable.
2. Synthetic assessment
2.1. Cost and price competitiveness
The preferred option is expected to have a positive impact on the competitiveness,
innovation and investment in cross-border interest representation activities carried out on
behalf of third countries by: 1) reducing the fragmentation of the regulatory environment
in the internal market and providing legal certainty to concerned entities; 2) levelling the
playing field through the elimination of diverging obligations for different types of entities
carrying out similar activities and 3) reducing administrative costs for entities carrying out
interest representation activities on behalf of third countries, in particular compliance costs,
because the initiative would reduce the need for multiple registrations.
The costs savings, better competitive environment, and the possibility to register in only 1
Member State permitted by the initiative will have positive effects on the capacity of
concerned entities to expand beyond their Member State’s domestic market.
It is to be noted nonetheless that some entities will only bear extra costs, in the case that
they were operating in a Member State which did not have any rules on interest
representation activities.
2.2. Capacity to innovate
The preferred options would only provide for proportionate (see section 6.2.3)
transparency requirements and would thus have no impact on the capacity to innovate of
the entities falling within their scope.
2.3. International competitiveness
The preferred option is not expected to affect international competitiveness of EU entities
carrying out interest representation activities.
2.4. SME competitiveness
The proposed obligation to maintain updated registration would involve an ongoing
compliance cost which could affect SMEs proportionately more than other actors.
However, other elements of the proposed initiative also will result in savings that can offset
those costs, in particular thanks to the simplification of the rules and the elimination of the
need for multiple registration when offering services across borders. Overall, the proposed
measures would increase cross-border activity for SMEs, which would have the
opportunity to scale up to operate at EU level.
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Annex 6: Evidence of current and potential future
fragmentation in the regulation of interest representation
activities across the internal market
This annex provides an overview of the evidence of fragmentation in the regulation of
interest representation activities across the internal market. The detailed information
contained in this annex has been extracted from the supporting study. The cut-off date is
January 23.
1. Overview of transparency rules, obligations and national transparency registers
on interest representation activities
One of the drivers of the lack of transparency in interest representation activities carried
out on behalf of third countries is the insufficient regulation of these activities at EU and
Member State level.
This sub-section first provides an analysis of the interest representation activities rules
applicable in the Member States, including information on available self-regulation and
guidelines adopted by the authorities, as well as any information available on draft laws in
the legislative pipeline of selected Member States (including for non-profit organisations).
This sub-section also specifies to what extent interest representation activities rules in
Member States also apply to such activities when carried out on behalf of third countries.
A comparative overview of national transparency registers for interest representation
activities in place in the Member States is then provided. Information on national
monitoring and enforcement is then detailed.
Overall, national rules on interest representation activities vary significantly across the
Member States. While some Member States have detailed legislation on interest
representation in place, others do not have any current or draft legislation.
1.1. Member State legislation on interest representation activities
While the laws of Member States do not contain specific rules on interest representation
activities carried out on behalf of third countries, 16 Member States (BE, DE, EL, ES254
,
FR, FI, CY, LT, HU, IE, LU, MT255
, AT, PL, RO256
, SI) have legislation on interest
representation activities in general, which is applicable by default to interest representation
activities carried out on behalf of third countries. Transparency registers for lobbying exist
in most of these Member States. The table below provides an overview (grouped by type
of provision) of several common provisions found in Member State laws regulating interest
representation.
254
Regulated at regional level.
255
While relevant provisions are found in various laws, these are not specifically addressed to lobbying by third
countries and illegal activities specifically in the context of foreign influence lobbying are not defined.
256
RO does not currently have specialized legislation regulating foreign lobbying activities, but it does have some
secondary legislation concerning lobbying (although this term is not specifically used).
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Overview of some common provisions, grouped by type
Provisions on interest representation Countries
Specific legal obligation to register
before undertaking interest
representation activities
DE257, IE, EL, FR, LT, LU, AT, PL, RO258
Public national transparency register BE, DE, IE, EL, ES259, FR, IT, LT, LU,
NL260, AT261, RO, SI
Reporting/declaration requirements for
registrants
CY262, LT263
Entry restrictions to buildings of
decision-makers
DE
In Austria, lobbyists are obliged to register in the Lobby Register before taking up their
activities264
. The Lobby Law provides for a differentiated system according to the type of
lobbyist/entity for registration in the Lobby Register, which is useful to detail265
. 4 types
of lobbyists (Types A, B, C, D below) are foreseen and for one such type, different
threshold were defined in practice266
:
• A: Lobbying companies: a company whose business purpose includes taking on
and fulfilling a lobbying mandate, even if it is not of a permanent nature. What is
important is whether lobbying is part of its business and whether the company takes
on lobbying assignments for a fee. This refers to lobbying assignments as defined
in the Lobby Law, i.e. the direct, structured and organised exertion of influence on
the public authorities.
• B: Companies that employ corporate lobbyists: Companies that do not use lobbying
companies to represent their individual interests vis-à-vis the public authorities, but
have this task performed by their own bodies or employees. Such employees or
organs of the company are called corporate lobbyists by the Lobby Law.
• C: Self-governing bodies: a non-territorial self-governing body established by law
or ordinance which looks after professional or other common interests of its
members, as well as an association of self-governing bodies which looks after these
interests nationwide (e.g. various chambers of commerce, professional
organisations and professional associations). The Lobby Law applies to such self-
257
Registration is mandatory only for those lobbyists who are contacting representatives of the DE Bundestag and/or
DE Federal government. In addition to the mandatory requirement of registration, the Lobby Register Act contains
a long list of those who may register voluntarily.
258
There is no special transparency register related to interest representation activities carried out on behalf of third
countries in RO. However, there is a Sole Register of Interests Transparency, which is a governmental online
platform (website) administered by the General Secretariat of the RO Government, by means of which decision-
makers register their meetings with specialised groups who manifest, of their own initiative, their interest for a certain
field falling under the prerogatives of the central and/or local public administration, for the purpose of promoting a
public policy initiative.
259
At the regional level.
260
The Travel Register and The Register for Side Activities are public.
261
However, access to data on clients of lobbyists and on principals of lobbyists is limited.
262
Semi-annual reports.
263
A lobbyist shall declare lobbying activities by submitting a declaration of transparent legislative processes for each
draft legal act.
264
‘Federal Act on Ensuring Transparency in the Exercise of Political and Economic Interests (Lobby law)‘
(Bundesgesetz zur Sicherung der Transparenz bei der Wahrnehmung politischer und wirtschaftlicher Interessen
(Lobbying- und Interessenvertretungs-Transparenz-Gesetz – LobbyG)), 2012, available at:
https://www.ris.bka.gv.at/GeltendeFassung.wxe?Abfrage=Bundesnormen&Gesetzesnummer=20007924.
265
§ 9 in conjunction with § 4 Lobby Law Vademecum to the Lobby Law (Section 6).
266
Confirmed in interviews conducted with Austrian stakeholders.
146
governing bodies only to a limited extent (e.g. no sanctions may be imposed on
their employees, such as an administrative fine if they misbehave in the context of
interest representation, it is up to the respective chamber to take the appropriate
measures).
• D: Interest groups: an association or contractual grouping of several persons whose
activities include the representation of common interests and which is neither a
lobbying firm nor a self-governing body. The representatives (organs or
employees) of these associations are also interest representatives according to the
Lobby Law, so the same considerations as described for self-governing bodies
apply here.
Total exemptions from the Lobby Act apply to political parties and to stakeholder
association for example. The Act is not applicable to them if they have no employees, who
are predominantly active – relative to their annual working hours – as interest
representatives in this field. With this, the legislature’s intention was to exempt small
associations267
.
Non-compliance with the registration requirement is an offence and is sanctioned by
administrative penalties: fine of up to EUR 20,000 may be imposed, in cases of repeat
violations even up to EUR 60,000.
The registration obligations are also ranked in relation to which company or which
institution performs the lobbying or the interest representation. Lobbying companies are
subject to the most comprehensive registration obligations. Registration obligations for
companies with in-house lobbyist are less far-reaching. Registration obligations require
only a minimum of data for self-governing bodies and private stakeholder associations.
Lobbying companies must communicate data on their lobbying contract: includes the name
of their client with all key data and the task area agreed.
The Austrian Court of Audit (ACA) presented reports on the lobby register in 2019268
established that there were a lot of gaps in the register and inaccurate information and data
was not always up-to-date. A further point being raised was that not all sections of the
register were open to the public, only the contracting parties of a lobbying order as well as
functionaries with whom a lobbyist could come into contact had the right to inspect the
register section A2 (lobbying orders from lobbying companies).The ACA criticised the
fact that the responsible Ministry did not feel responsible for examining the informational
value of the entries or to assess whether the obligation to register was fulfilled. No sanction
imposed by the Ministry for those lobbyists who failed to comply with the obligation to
register.
In Belgium, actors who are directly or indirectly influencing parliamentarians can register
in the Lobby Register269
. However, there are no penalties for non-compliance with the
registration requirement, as there is no obligation to register and it is done on voluntary
267
‘The Austrian Transparency Act 2013 for Lobbying and Interest Representation’, Austrian Federal Ministry of
Justice, 2014, available at: https://www.bmj.gv.at/dam/jcr:99f2bda7-4e79-4e7d-8b10-
975c64cf0374/report_on_the_austrian_transparency_act2013.pdf.
268
See note 252.
269
Article 163ter du règlement de la Chambre des Représentants du 2 octobre 2003, Chapitre IIIter, Le register des
lobbies (Article 163ter of Rules of the Belgian House of Representatives of 2 October 2003, Chapter IIIter. - The
register of lobbies), available at:
https://www.lachambre.be/kvvcr/pdf_sections/publications/reglement/reglementFR.pdf. These regulations go
beyond soft law rules of procedure because they are based on a constitutional provision on the exercise of the powers
of the chambers. They are a source of public law published in the national gazette.
147
basis. It should be noted that Belgian MEPs are not required to mention their meetings with
lobbyists.
In Cyprus, a law adopted in 2022270
regulates the participation of representatives of
interests (lobbyists) in public decision-making. However, interest representation activities
carried out on behalf of third countries is not distinguished in the law. All interest
representatives shall be registered in a Register of Lobbyists, although it is not accessible
to the public. The Register is operated by the Independent Authority against Corruption.
No specific threshold is set for the registrants to declare the amount of remuneration
received for lobbying services or any threshold for the amount of remuneration received
for each client. The registrants are obliged to submit semi-annual reports to the Authority
on any involvement in a public decision-making process that took place during the
preceding 6 months. These reports shall contain, inter alia, data referring to the identity of
the client, the objective of the lobbying services, the timeline for the provision of the
services etc.
The law also foresees several cases of offence. Particularly, the following are committing
an offence:
• Any person that is involved in decision-making procedures and actions and is not
registered with the Register271
;
• Anyone registered with an untrue application272
;
• A registered person that fails to report to the Authority273
;
• Anyone who submits an untrue complaint before the Authority274
.
In addition, the Authority may impose an administrative fine of up to EUR 100,000 or to
suspend or withdraw the registration of the registered lobbyist when the lobbyist commits
an act or omission. This holds true regardless of whether the act or omission is punishable
under the provisions of Law.
In Finland, in November 2023, an act entered into force which aims to establish a
transparency register. The purpose of the Act is to improve the transparency of decision-
making and thereby prevent undue influence and to strengthen citizens’ trust. The Ministry
of Justice is currently preparing to also update the Act on the Openness of Government
Activities. The Act lays down a registration obligation for private traders and legal persons
engaged in advocacy activities and related advice as a business. Besides that, tnterest
representation is currently indirectly regulated to some extent based on general
legislation275
. Particularly, provisions on administrative transparency are mainly laid down
in the Act on the Openness of Government Activities. Pursuant to this Act, a public
authority must, on request, provide information on public documents in its possession and,
in some cases, proactively communicate them. In some cases, letters and e-mails sent and
received by ministers, their political assistants and ministry officials may contain informal
influence and, as documents held by public authorities, fall within the scope of the Act on
the Openness of Government Activities unless they are internal work between civil
servants.
270
Law No. 20(I) 2022, available at: http://www.cylaw.org/nomoi/enop/non-ind/2022_1_20/full.html.
271
Subject to 1 year of imprisonment or a fine of up to EUR 10,000.
272
Subject to 3 years of imprisonment or a fine of up to EUR 30 000.
273
Imprisonment not more than 6 months or a fine not exceeding EUR 5 000.
274
Imprisonment or fine.
275
Such as the Civil Service Act, the framework formed by the Act on the Openness of Government Activities and the
Administrative Procedure Act, as well as the administrative regulations, such as the guidelines for consultation on
legislative drafting.
148
A registration requirement exists also in France, where, inter alia, interest representatives
have to provide information on the resources devoted to interest representation activities.
This platform is the Directory of the High Authority for the Transparency of Public Life
(HATVP).
A requirement to register with the Lobby Register exists also in Germany. Registration is
mandatory only for those lobbyists who are contacting representatives of the German
Bundestag and/or German Federal government. In addition to the mandatory requirement
of registration, the Lobby Register Act276
contains a long list of those who may register
voluntarily. In addition, the entry into the Bundestag is limited for lobbyists: for instance,
only the registered lobbyists with up-to-date data on the Register have the possibility to
participate in public hearings of committees as respondents. The provision of incorrect or
incomplete information at registration, the failure to register in time and the failure to
update the information are offences punishable by a fine. Notably, to ensure transparency
in every contact with representatives of the German Bundestag or Federal government, in
addition to disclosing their (or their principal’s) identity and request when interacting with
the abovementioned public officials, lobbyists must indicate that they are registered in the
lobby register and name the code of conduct on the basis of which they act.
In Greece, there is an obligation for lobbyists to register with the National Transparency
Authority’s (NTA) Register. The NTA has the power to conduct audits, adopt a code of
conduct for the registered lobbyists, and investigate any complaints for potential violations.
In case of violation, the NTA has the power to impose sanctions ranging from corrective
action notices, to fines from EUR 5,000-20,000 or even suspension of the right to exercise
lobbying activities and temporary/permanent exclusion from the Register.
In Hungary, the sector was regulated by Act XLIX of 2006 on lobbying (which included
provisions on a lobbying register). This was repealed and replaced in 2010 by Act CXXXI
on public participation in the preparation of legislation277
. The act regulates ‘direct
negotiations’. In this framework, the minister creates ‘strategic partnerships’ with
organisations ready to provide reciprocal cooperation and which represent wider social
interests. According to this act, the existence of such strategic partnerships must be public,
while the written opinions/views of strategic partner organisations must be made public
only to the parliamentary committee responsible for the legislative proposal, if the
committee requests it. Furthermore, a memo including the views of the strategic partner
must be made for in-person negotiations with strategic partners. These memos must be
published on the website operated by the Minister of Justice. Nevertheless, interest
representation carried out on behalf of third countries is not mentioned in this act.
In Ireland, the relevant legislation278
does not explicitly specify whether it is applicable to
cases of foreign lobbying. Nonetheless, it should be noted that “communications by or on
behalf of a country or territory other than the State” are “excepted communications” (i.e.
are not deemed lobbying activities). The main gap left by the Act is the lack of regulation
over the lobbying of Irish public officials taking place outside of Ireland279
. Similarly to
276
Vis-à-vis the German Bundestag and vis-à-vis the Federal Government (Lobby Register Act) (Gesetz zur Einführung
eines Lobbyregisters für die Interessenvertretung gegenüber dem Deutschen Bundestag und gegenüber der
Bundesregierung (Lobbyregistergesetz - LobbyRG)), 2021, available at: http://www.gesetze-im-
internet.de/lobbyrg/BJNR081800021.html.
277
Act CXXXI on public participation in the preparation of legislation, 2010, available at:
https://net.jogtar.hu/jogszabaly?docid=a1000131.tv.
278
Regulation of Lobbying Act 2015, available at: https://revisedacts.lawreform.ie/eli/2015/act/5/revised/en/html.
279
The counterargument to this has been that the onus should be on the lobbyists to register their activities. However,
that cannot be enforced when the lobbying takes place outside of the territory of Ireland. Therefore, regulating this
149
the abovementioned Member States, Ireland also has a Register of Lobbying, where
lobbyists are obliged to register before carrying out lobbying activities.
The Register is available free of charge on a website (save for personal data) maintained
or used by the Standards in Public Office Commission (SIPO), which establishes and
maintains the Register. According to an interview conducted with SIPO, the system works
with 2,400 registrants at the moment.
In addition, under the Lobbying Act of 2015, the following are considered offences:
• Failing to register as a lobbyist;
• Failing to make a return by the deadline;
• Providing SIPO with inaccurate or misleading information;
• Failing to co-operate with an officer who is investigating possible contraventions;
• Obstructing an investigation;
• Committing these offences can result in a fine or imprisonment of up to 2 years.
The Lithuanian legislation280
contains general restrictions on lobbying (albeit not
specifically on foreign lobbying). Particularly, only persons on the List of Lobbyists shall
have the right to carry out lobbying activities. Moreover, a lobbyist shall declare lobbying
activities by submitting a declaration of transparent legislative processes for each draft
legal act. Therefore, lobbying activities shall be considered illegal if (i) a lobbyist has failed
to declare lobbying activities or (ii) a person, who is not on the List of Lobbyists, carries
out lobbying activities. The Register is available publicly (in Lithuanian) on the website of
the Chief Official Ethics Commission. Lobbying activities in violation of the requirements
of the Law on Lobbying Activities shall be punishable by a fine of EUR 1000-4500281
.
In Luxembourg, any legal or natural person representing a third party or mandated by a
third party and acting on behalf of the latter or for himself or herself wishing to contact
Members with a view to influencing in any way their legislative work or the decision-
making process of the Chamber of Deputies (Lower House of the Parliament) must, prior
to any organised contact, register on the transparency register which is published on the
Chamber’s website (available to the public). Without such registration, there can be no
organised contact with Members to influence their legislative work or the decision-making
process of the Lower House.
While there is no specific legislation on lobbying in Malta, relevant provisions can be
found in various laws. Trading in influence is a criminal offence under Article 121A of the
Criminal Code. Moreover, the General Elections Act expressly provides for undue
influence as one type of corrupt practice under the Act. The Standards in Public Life Act
provides for the appointment of a Commissioner for Standards in Public Life and a
Standing Committee on Standards in Public Life with power to investigate breaches of
statutory or ethical duties of categories of persons in public life matters. The Act applies
gap would require placing the onus on the public officials, which was not agreed upon by the legislators. In these
situations, “international lobbyists are merely encouraged to disclose such information, without any legal
obligations.” See M Reilly, ‘What the Irish Regulation of Lobbying Act 2015 has failed to tackle’ Regulating
Lobbying, available at: https://sites.google.com/view/regulating-lobbying/home/work-of-colleagues/the-curious-
case-of-international-lobbying. However, guidance has been adopted to address this issue: see “How does the Act
apply to communications that take place outside of Ireland?”, available at the following link:
https://www.lobbying.ie/media/6262/frequently-asked-questions-june.pdf.
280
Law Amending the Law on Lobbying Activities No. VIII-1749 of the Republic of Lithuania, 2020, available at:
https://vtek.lt/wp-content/uploads/2021/06/EN_Law_on_Lobbying_Activities_2021.docx.
281
Article 14(1)(2) of the Law on Lobbying Activities of the Republic of Lithuania, available at: https://vtek.lt/wp-
content/uploads/2021/06/EN_Law_on_Lobbying_Activities_2021.docx.
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to members of the House of Representatives including Ministers, Parliamentary Secretaries
and Parliamentary Assistants and ‘persons of trust’ (Article 3(1) of the Act). A ‘person of
trust’ is defined in Article 2 of the Act as: any employee or person engaged directly from
outside the public service and the public sector to act as consultant or staff in the private
secretariat of a Minister or a Parliamentary Secretary; or a person engaged when a post
remains vacant following repetitive public calls for engagement; or a person who has been
engaged by a Minister or Parliamentary Secretary as a person of trust.
In Poland, the Exercise of Legislative Initiative by Citizens Act stipulates that a committee
may not cover the expenses related to the exercise of a legislative initiative with funds
(and, accordingly, non-monetary values) coming from:
• natural persons not residing in the territory of the Republic of Poland, excluding
Polish citizens residing abroad;
• foreigners residing in the territory of the Republic of Poland;
• legal persons not residing in the territory of the Republic of Poland;
• other entities not domiciled in the Republic of Poland, capable of undertaking
obligations and acquiring rights on their own behalf;
• legal persons with foreign participation;
• foreign diplomatic representations, consular offices, special missions and
international organisations, as well as other foreign representations enjoying
diplomatic and consular immunities and privileges under agreements, laws or
commonly established international customs.
The Lobbying Act282
stipulates that a public register of entities performing professional
lobbying activity is kept in the law-making process. Professional lobbying activity may be
carried out after obtaining an entry in the register.
In Romania, there is secondary legislation concerning lobbying. Particularly, there are
minimum transparency rules concerning the recommended framework of cooperation
between decision-makers at the level of central and local public administration authorities
and interested persons in civil society and specialized groups for the purpose of promoting
public policy initiatives. In addition, the Sole Register of Interests Transparency (Registrul
unic al transparenţei intereselor, RUTI) is the relevant transparency register for lobbying.
In Slovenia, lobbying is regulated by strict provisions in the Integrity and Prevention of
Corruption Act. Foreign lobbying is allowed in Slovenia on the condition that the lobbyist
is registered in the Register of Lobbyists. The Register is maintained by the Commission
for the Prevention of Corruption. Notably, the persons lobbied may agree to have contact
with the lobbyist only after verifying whether the lobbyist is entered in the register of
lobbyists. If, during contact with a particular lobbyist, a conflict of interest arises on the
part of the person lobbied, the person lobbied shall refuse any further contact with the
lobbyist. At every contact with a lobbyist, the person lobbied shall make a record
containing detailed information about the lobbyist.
Spain does not currently have legislation at state level. However, at regional level, some
Spanish regions have regional rules regulating the “activity of interest groups.”
1.2. National obligations on intermediaries in the context of interest
representation activities
282
Act of 7 July 2005 on lobbying activities in the law-making process (OJ 2005 No. 169, item 1414, i.e. OJ 2017 No.
248), available at: https://isap.sejm.gov.pl/isap.nsf/DocDetails.xsp?id=WDU20051691414.
151
There are no rules directly focused on the role of intermediaries in the context of lobbying.
However, 3 Member States’ laws (DE, IT, FI) mention intermediaries that can be relevant
to lobbying. In Germany, as noted earlier, the Lobby Register Act contains a list of actors
who may register voluntarily in the Register. This list includes “intermediary organisations
in foreign cultural and educational policy, insofar as they are institutionally supported with
funds from the (German) Federal budget.” In Finland, the Accounting Act and the Auditing
Act read together with the Act on the Prevention of Money Laundering and Terrorist
Financing can contain obligations for intermediaries in certain cases. Similarly, the anti-
money laundering legislative framework in Italy imposes obligations on intermediaries283
.
1.3. Draft laws/proposals on interest representation activities
According to the supporting study, in January 2023, draft legislation related to lobbying
was in discussion in 11 Member States (BE, BG, CZ, IE, ES, IT, LV, MT, NL, PL, SK).
The fourth edition of the Rule of Law Report issued by the Commission in July 2023 also
contains information on recent development on the regulation of lobbying activities in the
Member States.
More information is provided in Annex D of the supporting study.
1.4. Draft laws/proposals on transparency on (foreign) funding of non-profit
organisations
According to the supporting study, in January 2023, specific regulations were considered
on transparency on (foreign) funding of non-profit organisations in the Netherlands and
Poland. Since then, other Member States (SK and HU) have announced new measures.
More information is provided in Annex D of the supporting study.
1.5. Codes of conduct on interest representation activities
Codes of conduct on lobbying are available in 11 Member States (DE, IE, ES, HR, LV,
MT, NL, AT, RO, SI, FI). These codes are adopted by public authorities or by private
entities. An overview is provided in the table below, with further details provided in the
text.
Overview of codes of conduct in Member States based on the adopting entity
Adopting entity Member States
Codes of conducts adopted by public
authorities (including codes contained in
laws and orders of public authorities)
DE, IE, ES284
, MT, NL, RO, FI.
283
The legislative framework includes Legislative Decree No. 231 of November 21, 2007, most recently amended by
Legislative Decree No. 125 of October 4, 2019, and the relevant implementing provisions issued by the Minister of
Economy and Finance, the Financial Intelligence Unit for Italy, and the sector supervisory authorities.
284
At the regional level in Valencia.
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Adopting entity Member States
Codes of conducts adopted by
organisations / companies
DE285
, AT286
, HR287
, LV288
, SI289
The Austrian legislation requires that each lobbying company or a company that engages
lobbyists to adopt its own code of conduct. Every company registered in the lobbying
register should have such a code that should be available on its website. These codes of
conduct include a range of due diligence rules for lobbyists towards politicians.
In Croatia, lobbying organisations are often registered as consulting companies or
business advisors. In this light, it should be noted that some consultants have registered
with the Croatian Chamber of Commerce as the ‘Association of Business advisors’, which
includes some lobbying organisations. The Chamber has issued a Catalogue of Advisory
Services,290
which contains a Code of Ethics in business. However, this document does not
contain guidelines in respect of (foreign) funding.
The self-regulation of lobbing in Finland is mostly sectoral and voluntary. Meanwhile, the
Code of Conduct for civil servants and persons entrusted with top executive functions,
which consolidates existing guidelines, was published in May 2021291
.
The Lobby Register Act in Germany requires that the Bundestag and the Federal
government, with civil society, prepare and adopt a code of conduct for lobbyists. This
Code was adopted in June 2021 and has been in force since 1 January 2022. It largely
reiterates the provisions of the Lobby Register Act. In addition to this, some companies
and associations also have internal codes of conduct for lobbying activities292
. Moreover,
some companies are members of the German Association of Policy Consulting293
, which
has its own code of conduct294
, and participating companies adhere to this code295
.
In Ireland, the Standards in Public Office Commission has adopted a Code of Conduct296
,
which sets out several principles by which persons carrying out lobbying activities should
govern themselves. The Code of Conduct elaborates on the principles in separate
sections/chapters297
and should apply to all communications with persons in public office.
285
Some companies are members of the German Association of Policy Consulting, which has its own code of conduct,
and participating companies adhere to this code.
286
Each lobbying company or a company that engages lobbyists is required to adopt its own code of conduct.
287
Some of the lobbying organisations which are formed as consultants are registered with the Croatian Chamber of
Commerce. The Chamber has issued a Catalogue of Advisory Services, which contains a Code of Ethics in business,
although does not contain guidelines in respect of (foreign) funding.
288
Some organisations have such codes but may have not addressed how to engage with public officials in terms of
participation in decision-making processes.
289
Lobbyist organisations can adopt codes of ethics.
290
Catalogue of Advisory Services, Croatian Chamber of Commerce, available at https://www.hgk.hr/documents/hgk-
katalog-savjetodavnih-usluga-zajednice-poslovnih-savjetnika-drugo-izdanje596737316fb04.pdf.
291
Code of Conduct for administration, available at: https://julkaisut.valtioneuvosto.fi/handle/10024/163089.
292
Examples include the law firm Taylor Wessing (https://www.taylorwessing.com/de/about-us/lobbyregister-
deutschland), the association of real estate industry ZIA Central Real Estate Committee (https://zia-
deutschland.de/project/verhaltenskodex-des-zia-im-rahmen-des-lobby-und-transparenzregisters/), and the
multinational company Bayer (https://www.bayer.com/de/nachhaltigkeit/unsere-richtlinien-fuer-
verantwortungsbewusste-interessenvertretung).
293
De'ge'pol - Deutsche Gesellschaft für Politikberatung e.V.
294
Code of Conduct, available at: https://www.degepol.de/ethik-t.
295
For example, the bank ING (https://www.ing.de/ueber-uns/menschen/positionen/).
296
Standards in Public Office Commission, ‘Code of Conduct for persons carrying on lobbying activities’, published in
2018 and in force from 1 January 2019, available at: https://www.lobbying.ie/media/6119/code-of-conduct-english-
final-version-for-web.pdf.
297
These principles are: 1. Demonstrating respect for public bodies; 2. Acting with honesty and integrity; 3. Ensuring
accuracy of information; 4. Disclosure of identity and purpose of lobbying activities; 5. Preserving confidentiality;
153
Among their obligations on identification, the lobbyists also “must not conceal or try to
conceal the identity of a client, business or organisation whose interests they are
representing.” Moreover, a person carrying out lobbying activities should always the
elected or appointed public official of any personal interests they may have in the matter.
In addition, Chapter 6 on the principle of avoiding improper influence stipulates that a
person who is carrying out lobbying activities should not “seek to create a sense of
obligation on the part of the elected or appointed official by making any offer of gifts or
hospitality.” Moreover, such a person should not seek to influence an elected or appointed
public official “other than by providing evidence, information, arguments and experiences
which support their lobbying activities.”
In Latvia, most organisations currently lack applicable codes of conduct/ethics, while
many of those that do have such codes have not addressed how to engage with public
officials in terms of participation in decision-making processes.
The First and Second Schedules to the Maltese Standards in Public Life Act contain Codes
of Ethics applicable to members of the House of Representatives and to Ministers,
Parliamentary Secretaries and Parliamentary Assistants respectively. The codes, inter alia,
(i) prohibit members of the House of Representatives to receive any remuneration or
compensation for their work, except for their official remuneration, (ii) prohibits them from
using any improper influence, threats or undue pressure in the course of their duties, (iii)
prohibits Ministers, Parliamentary Secretaries and Parliamentary Assistants from putting
themselves in a position of being influenced by a financial obligation or otherwise of
persons or organizations that try to do so, or making improper use of information that
comes to their knowledge because of their office to give undue advantage to someone
whilst disadvantaging others, (iv) prohibits acceptance of any decoration from foreign
countries, except with the Prime Minister’s permission.
In the Netherlands, the sector of lobbying is regulated by the Code of Conduct for
Members of the House of Representatives298
, which in Rules 1 and 2 states that in their
relations with lobbyists, “members should always be aware of their independent position
and the duties that the Constitution assigns to them.” The Rules also state that although for
some degree of information lobbyists are important, “a degree of distance must always be
maintained from lobbyists. A member must therefore refrain from making promises in the
event of an offer from a lobbyist (not being information) about certain actions.” Notably,
foreign trips paid for in whole or in part by lobbyists are also deemed offers. The Code
stresses that a lobbyist “should be understood broadly” and may include “not only persons
working for lobbying firms, but also others who approach a Member of Parliament to stand
up for particular interests.” Furthermore, Members of the House of Representatives “must
declare their outside activities and income, interests that can reasonably be regarded as
relevant, foreign travel whose transportation and accommodation expenses were paid in
whole or partially paid by third parties, including lobbyists, and gifts and benefits that
exceed an amount of EUR 50 in excess299
”.
In addition, a Code of Conduct for the Senate obliges Senate Members to “guard against
improper influence” and maintain transparency when engaging with third parties. The
explanation to Article 3 of the Code specifically stipulates that “Members of the Senate
are expected to be transparent about their contacts with third parties, including foreign
6. Avoiding improper influence; 7. Observing the provisions of the Regulation of Lobbying Act; and 8. Having
regard to the Code of Conduct.
298
Code of Conduct for Members of the House of Representatives, rules of conduct 1 and 2, available at:
https://www.tweedekamer.nl/sites/default/files/atoms/files/gedragscode_leden_-_maart_2021.pdf.
299
See note 298, rule of conduct 3.
154
entities.” The explanation, however, adds that not all such contacts must be registered and
made public, justifying the lack of a lobby register (called “active disclosure” in the
explanation) by the lack of feasibility due to the large number of contacts maintained by
the Members. Nonetheless, “if asked, members should disclose what contacts they have
had with third parties regarding certain files” (called “passive disclosure” in the
explanation).
It should be noted that a gift register is established “in which members shall record gifts
received by them in their capacity as members of the Chamber with a value greater than
EUR 50, not later than1 week after receiving the gift300
”. This register should be available
for inspection by anyone.
Lastly, there is a Handbook for government officials, also called the “blue book301
” which
stipulates that for a period of 2 years after their resignation, former ministers and other
government officials are not allowed to lobby employees of their former ministry on behalf
of a company, semi-public organisation or a lobbying organisation representing interests
in the former minister’s policy area.
The largest professional association for lobbyists in the Netherlands, the Professional
Association for Public Affairs302
, has its own Code of Conduct, which contains rules of
conduct regarding transparency, integrity, and conflicts of interest. The government calls
on lobbyists to join and acknowledge this Code of Conduct303
. The Code applies to all
members of the Association, is public and reviewable. Nonetheless, it should be noted that
it does not contain rules related to interest representation activities carried out on behalf of
third countries specifically.
In Romania, Order no. 1056/2022 of the General Secretariat of the Romanian Government
also includes, in its Annex 2, a code of conduct for specialized groups participating in
meetings with decision-makers. It includes transparency, ethics and responsibility rules to
be respected by specialised groups in their relations with decision-makers304
.
In Slovenia, Article 57 of the Integrity and Prevention of Corruption Act305
gives lobbyist
organisations the right to adopt codes of professional ethics. They summarise the
provisions of the Integrity and Prevention of Corruption Act or uphold, in very general
terms, the importance of integrity and prevention of corruption in Slovenia.
At the regional level in Spain, the region of Valencia regulates lobbying by, inter alia,
setting out a code of conduct that interest groups must meet306
.
1.6. Guidelines on interest representation activities/ interest representation
activities carried out on behalf of third countries
300
Code of Conduct for Senate Integrity, article 3, available at: https://wetten.overheid.nl/BWBR0042225/2019-06-11.
301
Handbook for government officials, or the blue book, paragraph 6.2.2, available at:
https://open.overheid.nl/repository/ronl-a594769961105e6f150dc7b2726729961fa404ec/1/pdf/handboek-voor-
bewindspersonen.pdf.
302
In Dutch, ‘Beroepsvereniging voor Public Affairs’ (BVPA).
303
3559 Questions by the members Van Baarle (DENK) and Sneller (D66) to the Minister of Internal Affairs on the
report that the Netherlands would fall far behind with rules for lobbyists would fall far behind (submitted May 28,
2021), available at: https://zoek.officielebekendmakingen.nl/ah-tk-20202021-3559.pdf. Reply by Minister Ollongren
(Internal Affairs) (received July 13, 2021).
304
Example of these rules are: the obligation to declare their interests, objectives and purposes and to clarify who are
the clients or members that they represent in the meeting; the obligation not to obtain or to seek to obtain information
or to persuade public decision-makers by the use of illicit means.
305
Text in English available at: https://www.kpk-rs.si/en/wp-content/uploads/sites/2/2021/03/ZintPK-ENG-3.pdf).
306
Article 12 of Law 25/2018, of 10 December, regulating the activity of interest group groups of the Region of
Valencia, available at: https://www.boe.es/buscar/act.php?id=BOE-A-2019-967.
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Only Estonia and France have Guidelines adopted by public authorities which to some
extent are relevant for the transparency interest representation activities. In 2021, the
Estonian government adopted the document on “Good Practice in Communicating with
Lobbyists for Official307
”. According to the Good Practice, “information on the meetings
that have taken place is published on the websites of authorities on a quarterly basis.” In
contrast, in Denmark, the access to diaries/calendars of Ministers in office is specifically
exempt from the right to access to information308
. In France, the only relevant guidelines
on the topic are the ones issued by the High Authority for the Transparency of Public Life
(HATVP) on the Directory of Interest Representatives.
1.7. Member States with no regulation of the issue
4 Member States (DK, HR, PT, SE) do not have legislation, self-regulation or guidelines
related to lobbying.
In Croatia, there is no draft law as of November 2023. However, the Croatian Association
of Lobbyists is hoping that a law will be adopted in the course of 2023. The lack of
regulation of the topic and the lack of transparency has been raised as a concern from
various sides in Denmark. A draft legislation was proposed in Portugal in 2018309
.
However since then the Parliament was dissolved in 2022 and the proposal was left aside,
with no discussions on it as of November 2023. Lobbying generally is not regulated in
Sweden, save for recent rules imposing quarantine on ministers and secretaries of state to
work in the private sector310
. Calls for introducing a transparency register for lobbying in
the country are regularly dismissed in the name of the freedom of opinion.
2. Transparency registers related to interest representation activities
This sub-section provides a comparative analysis of transparency registers related to
interest representation activities, taking into consideration specific rules on interest
representation activities carried out on behalf of third countries. More precisely, the
analysis focuses on Member State rules on reporting and due diligence requirements
towards interest representatives as well as on required thresholds for transparency
registers. Applicable monitoring rules and sanctions for non-compliance are also analysed.
Similarities and divergences across Member State rules are discussed. The below table
provides a brief overview of the most significant findings under this sub-chapter.
Overview of main findings regarding transparency registers
Transparency register approaches Countries
15 Member States with transparency
register related to interest
representation
(No Member State with transparency
register specifically related to interest
representation activities carried out on
behalf of third countries)
BE, CY, DE, IE, EL, ES, FR, IT, LT, LU,
NL, AT, RO, SI, FI.
307
Good Practice in Communicating with Lobbyists for Officials, Approved by the decision of the Government of the
Republic of Estonia of 18 March 2021, available at:
https://www.korruptsioon.ee/sites/www.korruptsioon.ee/files/elfinder/dokumendid/good_practice_in_communicati
ng_with_lobbyists_for_officials_0.pdf.
308
§ 22 of the Act on Access to Information.
309
Available at: https://www.parlamento.pt/ActividadeParlamentar/Paginas/DetalheIniciativa.aspx? BID=43223.
310
The Act on Restrictions for Ministers and Secretaries of State to take up positions in the Private Sector 2018:676.
156
Transparency register approaches Countries
8 Member States with mandatory
transparency registers
DE, ES, FR, CY, LU, NL, AT, RO
2.1. Scope of transparency registers
12 Member States (BG, CZ, DK, EE, HR, LV, HU, MT, PL, PT, SK, SE) do not have a
transparency register covering interest representation activities and/or do not have specific
rules on interest representation activities carried out on behalf of third countries.
15 Member States (BE, DE, IE, EL, ES, FI, FR, IT, CY, LT, LU, NL, AT, RO, SI) have
a form of transparency register in place to monitor interest representation activities.
Belgium has a transparency register at federal level, and not on the level of its regions and
communities. Spain has transparency registers in place only in certain regions311
, but a
draft national level law is in the legislative pipeline312
.
The scope of rules related to transparency registers in the Member States where such
transparency registers exist show some similarities.
The actors required to register are usually formulated in general terms (DE, IE, ES, IT,
CY, LT, LU, RO, SI). In other words, natural and legal persons conducting lobbying
activities have an obligation to register themselves as lobbyists (sometime national laws
refer to lobbyists as interest representatives). In 5 Member States (BE, IE, FR, NL, AT)
more precise rules exist on the personal scope for registering:
• In Austria: 4 types of lobbyists (Types A, B, C, D as explained above) are
obliged to register;
• In Belgium, the Rules of the House of Representatives specify the entities that
are obliged to register. The list includes, for example, specialised law firms,
NGOs and think tanks;
• In France, the Act on Transparency, Action against Corruption and
Modernisation of Economic Life (Law Sapin II) lays down that interest
representatives must register. The law defines who can be regarded as an
interest representative (for example, certain actors under the Commercial
Code);
• In Ireland, different groups of lobbyists are required to register (interest body,
advocacy body, professional lobbyist, any person communicating about the
development or zoning of land);
• In the Netherlands, 3 groups are defined who need to register in the public
register of lobbyists: public affairs and public relations employees; agency
representatives of CSOs; and representatives of municipalities and provinces.
At this point, it is noted that further registers exist for parliamentarians, namely
a travel register (for example it includes information on who bore the
accommodation costs of a certain trip), a register of side activities (for example
includes information on income of ancillary activities exercised by a
parliamentarian) and gift registers for the House of Representatives and for the
311
In the following regions: Aragon, Asturias, Castilla-La Mancha, Catalonia, Madrid, Navarre and Valencia.
312
Draft Law on the Transparency and Integrity in the Activities of Interest Groups, available at:
https://www.hacienda.gob.es/Documentacion/Publico/NormativaDoctrina/Proyectos/Ley-Transparencia-Ley-NT8-
11-22-1.pdf.
157
Senate (includes information on gifts of parliamentarians received from third
parties).
No Member State legislation with a transparency register in force distinguishes between
domestic and foreign lobbyists. The existing rules apply to interest representatives
regardless of their domestic or foreign nature and no specific provisions applicable to
interest representation activities carried out on behalf of third countries exist. Similarly,
Member State laws do not require registrants to distinguish between sources of domestic
or foreign origin.
Furthermore, the definition of lobbying activities varies by Member State. The common
denominator is that lobbying activities cover activities aimed at influencing public
decision-making processes. 3 Member States (DE, LU, NL) have a more restrictive
approach, as they narrow down the regulation of lobbying activities to the scope of
contacting members of the government and/or the parliament.
2.2. Registration process and IT solution used
In 8 Member States (DE, ES313, FR, CY LU, NL, AT, RO) with an existing transparency
register, registering for lobbyists is mandatory (as mentioned earlier, this is primarily an
obligation for the state authorities in Romania). It should be noted that Germany keeps the
option for voluntary registration for certain actors (e.g. for religious communities). In 2
Member States (BE, IT) registration is voluntary.
Information regarding the IT solutions used for the registration process is limited in 3
Member States (EL, ES, CY).
In most Member States with a transparency register for lobbying activities, the registration
of interest representatives takes place online, through a website. An exception is the
Netherlands, where lobbyists wishing to be registered in the transparency register need to
pick up a form at the State Passes Service Desk of the House of Representatives (these
forms then can be submitted after they are filled out and the data provided is made publicly
available online). In the other Member States, where the registration is online, the websites
for registering are operated by various bodies:
• In 3 Member States (BE, DE, LU), the website is maintained by the (federal)
parliament;
• In 3 Member States (IT, AT, RO) the website is maintained by the government;
• In 6 Member States (IE, EL, FR, CY, LT, SI) the website is maintained by a
certain state body (e.g. by the National Transparency Authority in Greece).
As part of the registration process, most Member States require a specific online form (or
questionnaire) to be filled out and submitted, accessible on the website. However, in 2
Member States (LU, RO) specific rules are in place:
• In Luxembourg, registration can take place once a lobbyist has sent an email with
relevant data requesting registration to the Chamber of Deputies. The Chamber of
Deputies operates a specific email address314
for such requests. An Excel file is
accessible on the website of the parliament, which contains specific information on
registered lobbyists.
313
In Valencia, mandatory registration for interest groups contacting regional administration.
314
The request must be sent to the following email address: registredetransparence@chd.lu
158
• In Romania, the registration process is in inverse compared to other Member
States. This means that decision-makers must administer contacts prior to a
meeting with lobbyists into the online transparency register (RUTI), the platform
operated by the government. Lobbyists are obliged to provide necessary data to the
state representatives.
Moreover, as part of the IT solution, 4 Member States (DE, IE, IT, LT) require the creation
of an account on their website before registering. In 7 Member States (BE, EL, FR, CY,
LU, NL, AT) an account is not required to complete the registration process.
In addition, 3 Member States (FR, RO, SI) have more detailed provisions related to the
registration process:
• In France, lobbyists must complete registration no later than 2 months after the
date the entity meets the conditions to be regarded as an interest representative;
• In Romania, registration by the authorities in the RUTI must be completed at least
48 hours before the meeting with lobbyists takes place.
• In Slovenia, following an application by the interest representative, the authority
(Commission for the Prevention of Corruption) sends a confirmation form to the
applicant, which must be returned by the lobbyist within 8 days. Following the
receipt of the application form, the authority makes a decision within 15 days. A
fee is charged for the entry into the transparency register.
2.3. Data required
In terms of data required for transparency registers, Member States with such an instrument
in force show similarities.
The most recurring data required by transparency registers are the following:
• 12 Member States (BE, DE, IE, EL, FR, IT, LT, LU, NL, AT, RO, SI) require
identification data of interest representatives (e.g. name of the lobbyist).
• 10 Member States (BE, DE, IE, EL, FR, IT, LT, LU, AT, SI) oblige lobbyists to
provide information on the policy field in which they pursue interest representation
of clients.
• 8 Member States (BE, DE, EL, FR, IT, LU, NL, AT) request specific information
on the client represented by the lobbyist (e.g. name of the client).
• 5 Member States (DE, ES315, FR, IT, AT) ask for information on the (annual)
budget/expenditure from entities conducting lobbying activities, while SI requests
information on payments received from interest groups for each matter concerned.
No data is available on what type of information should be provided in Cyprus when
registering.
Beyond these similar rules, 5 Member States (DE, FR, AT, RO, SI) have specific rules on
types of data necessary to be included in their transparency registers:
315
In regions of ES with a transparency register, interest representatives must provide financial information. However,
in Valencia, data specifically on received funding is required.
159
• In Austria, legislation differentiates 4 types of lobbyists (lobbying company acting
on behalf of others; lobbying company acting in their own interest; interest group;
self-governing body) which provide different data when registering. For example,
lobbying companies need to declare their turnover and the number of their
contracts, while interest groups and self-governing bodies need to share
information on their total budget for lobbying (certified by an auditor).
• In Germany, individual donations and grants from the public sector exceeding
EUR 20,000, as well as individual gifts from third parties over EUR 20,000 are to
be announced by lobbyists. In addition, data on the number of employees of a
lobbyist is necessary to add into the register.
• In France, expenditure related to interest representation activities must be provided
(broken down by human and financial resources mobilised for lobbying activities).
The expenses must be communicated by indicating various ranges (e.g. expenses
between EUR 10,000 and EUR 25,000). Furthermore, information on all interest
representation actions aimed at influencing decision-making need to be forwarded,
as well as data on the number of staff employed annually.
• In Romania, the authority registers information related to meetings between
lobbyists and authorities, including the date and format of the meeting, as well as
names of all the participants in such a meeting.
• In Slovenia, data on the amount of payment received from interest groups must be
provided by the lobbyist (in case lobbying activities are part of a service contract,
the value of the contract must be stated). Furthermore, certain provisions exist
regarding foreign lobbyists. On the one hand, foreign lobbyists must hand in
officially translated documents for the registration to be approved. On the other
hand, foreign natural persons acting as lobbyist can be registered, if proven (with
an extract from the transparency register) that they act in the interest of a registered
lobbying entity (except if they are an employee or legal representative of an interest
group).
The data of transparency registers on lobbying is made public on websites of Member State
authorities in most Member States (BE, DE, IE, ES, FR, IT, LT, LU, NL, AT, RO, SI).
In 2 Member States (EL, CY), the data is not publicly available. In the Member States
where transparency registers are publicly accessible, certain restrictions exist. In Austria,
data related to clients of lobbyists is limited. In Germany, some pieces of personal data in
the register are not public. In Slovenia, the tax ID number of lobbyists is not accessible.
2.4. Applicable thresholds for registration
Concerning applicable thresholds, 10 Member States (BE, IE, EL, ES, CY, LT, LU, NL,
RO, SI) do not have such thresholds in place. In the remaining 5 Member States (DE, IE,
FR, NL, AT), various rules on thresholds are in place. The thresholds are either purely
financial (FR, NL) or it is based on non-financial thresholds such as frequency of contacts,
the number of employees, or the time dedicated to lobbying activities. These types of
thresholds are presented below:
• In Austria, what is interesting to note is that applicable thresholds differ according
to the type of lobbyist:
o The Act provides a threshold for company lobbyist: When determining
whether an employee, including directors, board etc, is a corporate lobbyist,
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lobbying must be “more than minor duty” which was defined as more than
5% of the total working time.
o For advocacy groups, 1 employee has to spend at least 15% of their time
conducting lobbying activities (it must be an employee of the advocacy
group, not e.g., its president).
• In Germany, legislation lays down that in case a certain condition is met, the
obligation to register is established. These thresholds are non-conjunctive (i.e. if1
of the 4 stands, the obligation is present). 2 out of 4 obligations are related to the
frequency of lobbying activity (lobbying is carried out regularly, or carried out on
a permanent basis). Another condition that can create the obligation is when the
lobbying activity has a commercial nature. Also, a lobbyist must be registered in
case such activity was conducted with 50 different contacts in 3 consecutive
months. This last condition ensures that the registration obligation is not
circumvented by non-regular or non-permanent activities. Furthermore, as already
mentioned on the previous page, financial thresholds to provide data on individual
donations, grants and gifts exceeding a certain amount exist in German federal
legislation.
• In France, financial thresholds exist in relation to turnover to be declared and
annual expenditure. The range for turnover is to be declared indicating an
approximate, between various ranges (indicated in increments), as mentioned
earlier under the previous sub-heading.
• In Ireland, persons who are carrying on lobbying activities are required to register,
if they meet all the following conditions:
o They are communicating either directly or indirectly with a “Designated
Public Official”; and
o That communication is about “a relevant matter”; and
o That communication is not specifically exempted; and
o They are one of the following:
▪ An employer with more than 10 employees where the
communications are made on the employer’s behalf.
▪ A representative body with at least 1 employee communicating on
behalf of its members and the communication is made by a paid
employee or paid office holder of the body.
▪ An advocacy body with at least 1 employee that exists primarily to
take up particular issues and a paid employee or paid office holder
of the body is communicating on such issues.
▪ A professional lobbyist being paid to communicate on behalf of a
client (where the client is an employer of more than 10 full time
employees or is a representative body or an advocacy body which
has at least1 full-time employee).
• In the Netherlands, the gift register for the Members of the House of
Representatives includes a specific threshold. According to rules, gifts exceeding
the value of EUR 50 must be registered, specifying the nature of the gift, the price
of the gift and the person providing the gift.
3. Monitoring and enforcement of national transparency registers
161
In this sub-chapter, monitoring practices and enforcement rules in Member States with a
transparency register in place are outlined. Lobbying carried out on behalf of third
countries is not addressed by any Member State, neither for monitoring, nor for
enforcement rules. A raft law in Spain316
would introduce a mandatory public transparency
register, which would be complemented by monitoring and enforcement rules.
In 9 Member States (IE, EL, ES317, FR, IT, CY, LT, SI, FI) the national register is
supervised by an independent authority. In the 6 other Member States that have a
transparency register, 3 (LU, AT, RO) tasked their government with this tasked and 3
tasked their parliament (BE, DE, NL).
3.1. Monitoring
2 Member States (BE, IT) with existing transparency registers lack rules on monitoring
and enforcement in this regard. 11 Member States (DE, EL, ES318, FR, CY, LT, LU, NL,
AT, RO, SI) implement monitoring and enforcement regimes, which differ in strictness.
Several Member States have introduced reporting obligations. On the one hand, 3 Member
States (FR, CY, SI) oblige lobbyists to report periodically (e.g. annually) on their activities
involving public decision-making. On the other hand, 4 Member States (LT, LU, RO, SI)
oblige parliamentarians and/or public officials to inform the competent authority on their
contacts with lobbyists. Additionally, in Slovenia, clients of lobbyists must also provide
details related to lobbying activities to the Commission for the Prevention of Corruption.
2 Member States (DE, NL) have established rules on an access protocol into the premises
of their respective parliaments. In other words, unregistered lobbyists do not receive the
necessary pass to enter parliament. These measures also aim to ensure that lobbyists keep
their registered data updated.
In Greece, the National Transparency Authority has the power to conduct audits and create
codes of conducts for registered lobbyists as part of their monitoring system.
3.2. Enforcement
In terms of enforcement, currently 5 Member States (DE, IE, EL, CY, LT) have sanctions
in place for non-compliance with registering rules. Fines as a form of sanctions are applied
by all aforementioned Member States, while suspension or removal from the transparency
register is present as an enforcement measure in 2 Member States (DE, EL). In addition,
in Ireland, offences to registration rules (as detailed previously) can result in an
imprisonment of up to 2 years.
316
A draft law (‘Draft Law on the Transparency and Integrity in the Activities of Interest Groups’) at national level is
under discussion, available at:
https://www.hacienda.gob.es/Documentacion/Publico/NormativaDoctrina/Proyectos/Ley-Transparencia-Ley-NT8-
11-22-1.pdf.
317
Catalonia.
318
Solely on regional level.
162
Annex 7: Analysis of administrative fines and thresholds for
information requests
This Annex provides explanations on the proposed pecuniary sanctions and thresholds for
requests for additional information by supervisory authorities set out in the preferred policy
option.
1. Administrative fines
To determine the figures for the amounts of the administrative fines proposed under the
preferred policy option, the following methodology was used.
First, figures for the average turnover per entity were obtained from the Eurostat Structural
Business Statistics (SBS) annual detailed enterprise statistics for services for NACE code
M70.21 on “Public relations and communication activities”.
Second, benchmarks from percentage figures based on other recent EU regulatory instrument
were compared to existing pecuniary sanctions regime in Member States. In the table below,
the figures of 2% and 4% of global turnover are the maximum fines for different types of GDPR
violations, while 1% and 6% are the maximum fines for different types of DSA violations. Data
on existing maximum fine amounts in Member States is provided where possible, along with
approximate equivalents in proportion of turnover.
Lastly, the benchmark retained was that of the penalties under Article 52(3) of the DSA which
relates to failures to comply with transparency requirements, namely, penalties of “1% of the
annual income or worldwide turnover” for “for the supply of incorrect, incomplete or
misleading information, failure to reply or rectify incorrect, incomplete or misleading
information and failure to submit to an inspection”.
163
TABLE 1: Benchmarks for administrative fines
Member
State319
Average
turnover
per entity
(EUR million)
Existing maximum
fines (EUR)
Proposed fines (EUR) – Proportion of turnover
Amounts
Equivalent in
proportion of
turnover (approx.)
0.25% 0.50% 1% 2% 4% 6%
EU-27 140,809.83 - - 352.02 704.05 1,408.10 2,816.20 5,632.39 8,448.6
Ireland 627,505.33 25,000 4% 1,568.76 3,137.53 6,275.05 12,550.11 25,100.21 37,650.33
Germany 540,219.95 50,000 10% 1,350.55 2,701.10 5,402.20 10,804.40 21,608.80 32,404.20
Spain 334,015.00 300,000320
10% 835.04 1,670.07 3,340.15 6,680.30 13,360.60 20,640.90
Luxembourg 286,956.52 - - 717.39 1,434.78 2,869.57 5,739.13 11,478.26 17,217.39
Austria 223,833.33 60,000 25% 559.58 1,119.17 2,238.33 4,476.67 8,953.33 13,430.01
Finland 220,481.93 - - 551.20 1,102.41 2,204.82 4,409.64 8,819.28 13,228.92
Belgium 219,701.25 - - 549.25 1,098.51 2,197.01 4,394.03 8,788.05 13,182.09
Denmark 211,414.21 - - 528.54 1,057.07 2,114.14 4,228.28 8,456.57 12,684.84
Cyprus 205,000.00 100,000 50% 512.50 1,025.00 2,050.00 4,100.00 8,200.00 12,300.00
Sweden 167,768.40 - - 419.42 838.84 1,677.68 3,355.37 6,710.74 10,066.11
Malta 150,000.00 - - 375.00 750.00 1,500.00 3,000.00 6,000.00 9,000.00
Italy 132,224.44 - - 330.56 661.12 1,322.24 2,644.49 5,288.98 7,933.47
Slovakia 130,769.23 - - 326.92 653.85 1,307.69 2,615.38 5,230.77 7,846.14
Croatia 128,070.18 - - 320.18 640.35 1,280.70 2,561.40 5,122.81 7,684.20
Portugal 124,046.92 - - 310.12 620.23 1,240.47 2,480.94 4,961.88 7,442.82
Slovenia 103,875.97 100,000 10% 259.69 519.38 1,038.76 2,077.52 4,155.04 4,155.04
France 97,159.05 15,000321
1.5% 242.90 485.80 971.59 1,943.18 3,886.36 5,829.54
Romania 95,218.72 - - 238.05 476.09 952.19 1,904.37 3,808.75 5,713.11
Poland 85,797.81 12,000 15% 214.49 428.99 857.98 1,715.96 3,431.91 5,147.88
Latvia 76,712.33 - - 191.78 383.56 767.12 1,534.25 3,068.49 4,602.75
Hungary 68,002.84 - - 170.01 340.01 680.03 1,360.06 2,720.11 4,080.18
Greece 62,115.38 20,000 30% 155.29 310.58 621.15 1,242.31 2,484.62 3,726.93
Lithuania 57,541.19 4,500 8% 143.85 287.71 575.41 1,150.82 2,301.65 3,452.46
Bulgaria 39,108.91 - - 97.77 195.54 391.09 782.18 1,564.36 2,346.54
319
Data on turnover was not available in CZ, EE and NL.
320 In ES, pecuniary sanctions only exist at regional level.
321
In FR, the sanctions amounts provided are of criminal nature, as in they are the highest amounts possible. Figures for all other Member States concern administrative sanctions.
164
2. Thresholds for information requests
As part of the risk-based approach set forth in the preferred policy option, thresholds are
proposed in order to allow supervisory authorities to request records kept by entities carrying
out interest representation activities on behalf of third countries.
The thresholds are as follows:
• The first threshold sets that supervisory authorities will be able to request information
to an entity if it received more than EUR 1 000 000 from a single third country entity
in the preceding financial year.
• The second thresholds establish that Supervisory authorities will be able to request
information to an entity if it carries out interest representation activities for a third
country entity whose action can be attributed to a third country that has spent a EUR 1
500 000 on interest representation in a Member State or EUR 8 500 000 in the Union
as a whole in 1 of the last 5 years.
• The third threshold is a de minimis to exclude entities that received an aggregate
remuneration of less than EUR 25 000 in the preceding financial year.
The figures for the first and third thresholds are based on the data coming from the annual
costs for entities in the EU Transparency Register (EU TR) whose head office is located outside
the Union and who “Promote their own or collective interests”. Limitations in the data of the
EU TR did not permit to provide further detail, e.g. per sector or policy area. As detailed in the
table below, the first threshold, at EUR 1 000 000, permits to cover the top 3.58% largest
entities with enhanced information disclosure requirements (see below highlighted in green).
The third thresholds, de minimis, at EUR 25 000 permits to exclude from the scope the 36.21%
smallest entities which carry out only very limited amounts of interest representation activities
on behalf of third countries (see below highlighted in orange).
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TABLE 2: EU TR – Annual costs of entities whose head office is outside the
Union and that “Promote their own or collective interests”
Brackets of reported annual costs
(EUR)
Number
of
entities
Proportion
of entities
(in %)
Cumulated
proportion of
entities
(approx., in
%)
0.00 – 0.00 29 2.12 2.12
0.00 – 10,000.00 321 23.43 25.55
10,000.00 – 24,999.00 146 10.66 36.21
25,000.00 – 49,999.00 133 9.71 45.92
50,000.00 – 99,999.00 171 12.48 58.40
100,000.00 – 199,999.00 171 12.48 70.88
200,000.00 – 299,999.00 117 8.54 79.54
300,000.00 – 399,000.00 64 4.67 84.09
400,000.00 – 499,999.00 55 4.01 88.10
500,000.00 – 599,999.00 33 2.41 90.51
600,000.00 – 699,999.00 27 1.97 92.48
700,000.00 – 799.999.00 22 1.61 94.09
800,000.00 – 899,999.00 14 1.02 95.11
900,000.00 – 999,999.00 18 1.31 96.42
1,000,000.00 – 1,249,999.00 14 1.02 97.44
1,250,000.00 – 1,499,999.00 13 0.88 98.32
1,500,000.00 – 1,749,999.00 1 0.07 98.39
1,750,000.00 – 1,999,999.00 4 0.29 98.68
2,000,000.00 – 2,249,999.00 2 0.15 98.83
2,250,000.00 – 2,499,999.00 4 0.29 99.12
2,750,000.00 – 2,999,999.00 3 0.22 99.34
3,000,000.00 – 3,499,999.00 2 0.15 99.45
4,000,000.00 – 4,499,999.00 2 0.15 99.64
4,500,000.00 – 4,999,999.00 1 0.07 99.71
5,000,000.00 – 5,499,999.00 1 0.07 99.78
6,000,000.00 – 6,499,999.00 1 0.07 99.85
6,500,000.00 – 6,999,999.00 1 0.07 99.92
Total 1,370 - 100
With regard to the second thresholds, as explained in the problem definition chapter, no data
currently exists as to how much third countries spend on interest representation activities in the
EU. It is therefore difficult to estimate at which pecuniary amount to draw to line. The only
closest possible benchmark that could be used is that from the FARA portal for 2020. However,
this approach suffers from several limitations: (i) The market in the US is vastly different and
amounts spent in interest representation activities tend to be much higher, and (ii) FARA covers
a broader set of activities than the EU TR (for example, it includes spending by embassies, as
well as spending on broadcast and media content which are excluded from both the EU
Transparency Register).
166
Nonetheless, the table below shows the total amount spent on so-called ‘core’ interest
representation services under FARA322
by a selected set of countries in 2020, as well as the
total amounts they reported under FARA that same year. These figures were used as a
benchmark to help the definition of the second thresholds. Among the 11 selected third
countries under the US FARA, the average amount spent by the selected third countries in 2020
in the US was USD 12,090,456.12, which is equivalent to EUR 11 284 730.04. Because the
EU economy was approximately 25% smaller than that of the US in 2020323
, a factor of 25%
was applied to this amount, leading to a threshold of EUR 8 463 547.53324
. This figure was
then approximated to EUR 8 500 000.
TABLE 3: Lobbying costs reported under US FARA
Selected 3rd
Country Total amounts
reported under FARA
in 2020325
Total amounts spent on core interest
representation services in 2020
Canada USD 12,602,960.45 USD 1,244,662.12
Russia USD 45,320,532.84 USD 2,992,033.28
Morocco USD 4,090,941.91 USD 3,149,269.29
Iraq USD 3,413,684.68 USD 3,383,533.79
South Korea USD 31,051,235.52 USD 3,805,698.95
Japan USD 37,434,911.22 USD 4,943,798.86
China USD 58,840,168.30 USD 16,941,737.95
UAE USD 26,230,546.06 USD 17,949,480.51
Turkey USD 24,803,996.99 USD 21,101,502.22
Qatar USD 53,748,327.60 USD 22,507,594.28
Saudi Arabia USD 40,175,849.53 USD 34,975,746.10
Average across selected 3rd
countries
USD 33,771,315.41 USD 12,090,456.12
Lastly, the threshold at EUR 1 500 000 was obtained by dividing the EU-wide EUR 8 500 000
threshold by the share of GDP of each Member State. This results in the figures in the table
below. The Commission decided to use as a benchmark the resulting thresholds of France,
rounded to the nearest 100 000 above. It is important to note that this is an initial threshold that
it will be possible to modify via a Delegated Act after the entry into force of the legislative
instrument once more data is available on the phenomenon of interest representation activities
carried out on behalf of third countries. Setting a high bar at first permits to scope in fewer
entities and reduce risks of overburdening.
322
Core interest representation services in the FARA system relate to the following categories: “Legal and Other
Services/Lobbying”, “Lobbying”, “Public Relations”, “U.S. Policy Consultant”.
323
According to World Bank data for 2020, the US nominal GDP was of USD 20,893,746 bn, and that of the EU was of USD
15,292,101 bn, making the EU’ economy approximately 25% smaller than that of the US. Figures available at the following
link: https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?most_recent_value_desc=true.
324
EUR 11,284,730.04*0.75= EUR 8,463,547.53
325
For countries like China or Russia, the vast majority of the total spending reported under FARA falls into activities which
are covered by FARA but that would not fall into the scope of the preferred option, such as “Broadcast spent in broadcast
services etc.”, hence the drops in amounts.
167
TABLE 4: Thresholds for information requests based on individual
Member States’ portions of EU GDP
Member State Percentage of EU GDP
(nominal)326
Possible
thresholds (EUR)
Germany 24.46 2,164,100
France 16.72 1,421,200
Italy 12.08 1,026,800
Spain 8.41 714,850
Netherlands 5.96 506,600
Poland 4.14 351,900
Sweden 3.53 300,050
Belgium 3.49 296,650
Ireland 3.18 270,300
Austria 2.83 240,550
Denmark 2.37 201,450
Romania 1.81 153,850
Czechia 1.75 148,750
Finland 1.69 143,650
Portugal 1.51 128,350
Greece 1.32 112,200
Hungary 1.07 90,950
Slovakia 0.68 57,800
Bulgaria 0.53 45,050
Luxembourg 0.49 41,650
Croatia 0.43 36,550
Lithuania 0.42 35,700
Slovenia 0.37 31,450
Latvia 0.25 21,250
Estonia 0.23 19,550
Cyprus 0.17 14,450
Malta 0.11 9,350
326
Figures from: ‘Percentage share of the European Union’s Gross Domestic Product (GDP) in 2022, by member state’,
Statista, https://www.statista.com/statistics/1373419/eu-gdp-percentage-share-member-state-2022/.
168
Annex 8: Fundamental rights impact
1. Right to private life and the right to the protection of personal data
All 3 policy options impose limited restrictions on the right to private life (Article 7 of
the Charter) and the right to the protection of personal data (Article 8 of the Charter),
insofar as they require that entities keep and provide certain information to the national
authorities and provide access for the public to a part of that information which might
include personal data. The legislative policy options (PO2.1 and PO2.2) provide in addition
for the exchange of such information among competent national authorities.
As noted by the Court, provisions imposing or allowing the communication of personal
data such as the name, place of residence or financial resources of natural persons to a
public authority must be characterised as an interference in their private life and therefore
as a limitation on the right guaranteed in Article 7 of the Charter, without prejudice to the
potential justification of such provisions. The same is true of provisions providing for the
dissemination of such data to the public327
. Furthermore, the Court has considered that
making personal data available to the public in a manner that such data are accessible to a
potentially unlimited number of persons constitutes a serious interference with the
fundamental rights enshrined in Articles 7 and 8 of the Charter328
.
However, as also stated by the Court, fundamental rights enshrined in Articles 7 and 8 of
the Charter are not absolute rights, but must be considered in relation to their function in
society. These rights may be restricted if such restriction is provided by law, it respects the
essence of these rights and if it is strictly necessary and proportionate in relation to the
objective of general interest recognised by the European Union. In this regard, Article 8(2)
of the Charter requires that personal data must be processed for specified purposes and on
the basis of consent or some other legitimate interest laid down by law329
.
For all 3 policy options, by providing for citizens’ access to information on entities active
in the internal market carrying out interest representation activities carried out on behalf
of third countries, as well as the third country entities they represent, seek to ensure that
citizens, public officials and stakeholders, like journalists and CSOs, can exercise their
democratic scrutiny while knowing with which entities they themselves, or their elected
representatives, may be confronted with. As voters, citizens are important decision-makers
in their own right, and as such, they can be the target for certain interest representation
activities.
All 3 policy options enhance the integrity of, and public trust in, the EU’s and Member
States’ democratic institutions by ensuring the transparency of interest representation
activities carried out on behalf of third countries, and by improving the knowledge about
the magnitude, trends and actors of interest representation activities carried out on behalf
of third countries (see sections 6.2.2.1 and 6.2.2.2)330
. The CJEU has recognised that the
objective consisting in increasing transparency is an overriding reason in the public
327
See, to that effect, judgments of the Court of Justice 20 May 2003, Österreichischer Rundfunk and Others, C‑465/00,
C‑138/01 and C‑139/01, EU:C:2003:294, paragraphs 73 to 75 and 87 to 89; of 9 November 2010, Volker und Markus
Schecke and Eifert, C‑92/09 and C‑93/09, EU:C:2010:662, paragraphs 56 to 58 and 64; and of 2 October 2018,
Ministerio Fiscal, C‑207/16, EU:C:2018:788, paragraphs 48 and 51).
328
Judgment of the Court of Justice of 22 November 2022, Luxembourg Business Registers, joined cases C-37/20 and
C-601/20, EU:C:2022:912, paragraphs 42 to 44.
329
See note 328, paragraphs 45 to 63 and the case-law cited.
330
See note 182, paragraph 105.
169
interest331
.The aim pursued by the 3 policy options therefore constitutes an objective of
general interest that is capable of justifying interferences with the fundamental rights
enshrined in Articles 7 and 8 of the Charter in line with Article 52 thereof.
Furthermore, the seriousness of the interference with the fundamental rights enshrined in
Articles 7 and 8 of the Charter should be balanced against the importance of the objective
of general interest of ensuring that citizens can exercise their right of democratic scrutiny
while knowing with which entities they themselves, or their elected representatives, may
be confronted with. It must be noted that, in contrast with the situation that gave rise to the
judgment in Luxembourg Business Registers concerning the general public’s access to
information on beneficial ownership, ensuring transparency of activities affecting
democratic decision-making is a priority for all citizens, and not just a matter for public
authorities.
All 3 policy options provide for public access to a clearly defined and limited set of
information, which excludes information that is not adequately related to the purposes
pursued. As a result, making publicly available information that is so related does not in
any way undermine the essence of the fundamental rights guaranteed in Articles 7 and
8 of the Charter332
.
Public access to information on interest representation activities carried out on behalf of
third countries is appropriate for contributing to the attainment of the objective of general
interest pursued, since the public nature of that access and the increased transparency
resulting therefrom contribute to the creation of an environment of greater democratic
scrutiny and accountability.
All 3 policy options provide for public access to a proportionate, clearly defined and
limited set of information, which excludes information that is not absolutely needed to
reach the purposes pursued. The limitations on the right to private life and the right to the
protection of personal data, genuinely meet a general interest recognised by the EU,
and are proportionate and limited to the minimum necessary.
In particular, in the legislative policy options (PO2.1 and PO2.2), the set of data to be made
available to the public is limited to what is necessary to improve knowledge about the
magnitude, trends, and actors of interest representation carried out on behalf of third
countries333
. It is clearly and exhaustively defined and fully harmonised throughout the
EU. In addition, the personal data made publicly available is limited to the minimum
required for citizens to be informed about the entity carrying out interest representation
and the activity carried out on behalf of third country entities. Information of relevance
only to the competent national authorities, supervising and monitoring compliance with
those options, would not be made publicly available, to safeguard against the risks of abuse
of the information provided.
In addition, the legislative policy options (PO2.1 and PO2.2), beyond fully harmonising
the set of data to be made public, provide for additional and specific safeguards by enabling
entities to request that all or part of the information gathered for the purpose of the
transparency requirement is not made public based on an overriding interest.
The requirement in PO2.2 that entities falling within the scope of the risk-based approach
is required to automatically share all of their records with the supervisory authorities could
331
See note 125, paragraph 79.
332
See note 328, paragraphs 51 to 52.
333
See section 5.3.2.1 for details on the information to be made public.
170
go beyond what is necessary to ensure the transparency of interest representation activities
carried out on behalf of third countries.
2. Freedom of Association
The fundamental right to freedom of association is guaranteed both under Article 12 of
the Charter and Article 11 of the European Convention on Human Rights to all
associations, including CSOs, interest groups, trade unions and political parties.
Careful consideration is being given to the potential spill over effect of the measures and
unintended negative consequences for the operation of CSOs, which are operating in a
shrinking civic space.
The 2022 FRA’s report334
highlights that in 2020, 15% CSOs faced legislations on
transparency and lobby laws negatively affecting their freedom. Examples of burden
include costly registration procedures and disproportionate transparency regulations335
.
Moreover, the risk of such laws being abused arises when laws prohibit CSO registration,
allow their dissolution, or criminalise CSO membership, for example, on the basis of a lack
of adherence to democratic values.
The Hungarian Transparency Act (Law No LXXVI of 2017) introduced restrictions on
financing of civil organisations. The law applied indiscriminately to any financial support
from any other Member State or any third country336
. Among other requirements, it
required CSOs to systematically present themselves to the public as ‘organisation in receipt
of support from abroad’, thereby creating a climate of distrust towards them, apt to deter
natural or legal persons from other Member States or third countries from providing them
with financial support337
.
Following an infringement procedure initiated by the Commission, the Court of Justice
ruled that by adopting the legal provisions in question, which impose obligations of
registration, declaration and publication on certain categories of CSOs directly or
indirectly receiving support from abroad exceeding a certain threshold and which provide
for the possibility of applying penalties to organisations that do not comply with those
obligations, Hungary introduced discriminatory and unjustified restrictions on foreign
donations to CSOs, in breach of its obligations under Article 63 TFEU on the free
movement of capital and Articles 7, 8 and 12 of the Charter338
.
Outside the EU, countries have put in place legislation with the objective of restricting or
controlling CSO activities. The Russian Regulation of the Activities of Non-profit
Organisations Performing the Functions of a Foreign Agent, adopted in 2012 and amended
in 2022 has been used to stigmatise and significantly limit the rights of different groups of
society, including CSOs, unregistered public associations, media outlets, journalists,
activists and human rights defenders339
. Other attempts to enact laws aiming to scrutinize
the work of CSOs receiving support from abroad include the Georgian draft law on
transparency of foreign influence and the Republika Srpska’s draft law on the Special
334
‘Fundamental Rights Report 2022’, European Union Agency for Fundamental Rights, available at:
https://fra.europa.eu/en/publication/2022/fundamental-rights-report-2022-fra-opinions.
335
See also the Communication from the Commission to the European Parliament, the Council, the European Economic
and Social Committee and the Committee of the Regions on the 2023 Rule of Law Report – The rule of law situation
in the European Union (COM(2023) 800 final).
336
See note 125, paragraph 82.
337
See note 125, paragraph 58.
338
See note 125.
339
Judgment of the ECtHR, Ecodefense v. Russia, see note 188.
171
Register and Transparency of the Work of the non-profit organisations340
, which have been
condemned by the EU341
.
Freedom of association constitutes one of the essential pillars of a democratic and
pluralistic society, in as much as it allows citizens to act collectively in fields of mutual
interest and to contribute to the proper functioning of public life342
. Associations must be
able to pursue their activities, operate without unjustified interference, and obtain resources
to support their operations. The Court considers that legislation which renders significantly
more difficult the action or operations of associations, whether by strengthening the
requirements in relation to their registration, by limiting their capacity to receive financial
resources, by imposing obligations of declaration and publications such as to create a
negative image of them or by exposing them to the threat of penalties, in particular of
dissolution, is to be classified as a limitation to the freedom of association343
.
The examined policy options are limited to ensuring transparency regarding interest
representation activities carried out on behalf of third country entities and seeking to
influence decision-making processes in the EU. They do not affect as such the possibility
for entities to carry out these activities (with the exception of PO2.2). However,
transparency requirements could have a spill over effect on other activities of CSOs for
instance their advocacy work.
While imposing transparency obligations, which may be considered as having an impact
on the effective enjoyment of the right to freedom of associations – in as much as the
requested organisations would have to comply with the registration/reporting obligations
and pay the related costs – all 3 policy options do not affect the essence of that right.
Moreover, with specific regard to the right to seek for funding and resources, none of the
policy options ban foreign funding.
All 3 policy options enhance the integrity of, and public trust in, the EU’s and Member
States’ democratic institutions by ensuring the transparency of interest representation
activities carried out on behalf of third countries, and by improving the knowledge about
the magnitude, trends and actors of interest representation activities carried out on behalf
of third countries (see sections 6.2.2.1 and 6.2.2.2)344
. The CJEU has recognised that the
objective consisting in increasing transparency is an overriding reason in the public
interest345
. All 3 policy options meet the objective of general interest, in light of the
principles of openness and transparency, which must guide the democratic life of the Union
in accordance with the second paragraph of Article 1 and Article 10(3) TEU and in
340
According to Republika Srpska’s draft law, foundations as well as foreign and international non-governmental
organisations receiving any form of foreign funding or other assistance of foreign origin would be designated as
“Non-profit organisations” (hereinafter “NPOs”). This draft law would prohibit NPOs from carrying out political
activities, requiring them to register in a special registry and all their published materials to include the mark “NPO”,
and to submit additional reports compared to those already required by the existing legal framework. NPOs would
also be subject to an additional legal regime of oversight and inspections, and a range of sanctions for violations of
the provisions of the draft law that may result in the ban of the NPOs’ activities and thereby of the NPO itself. The
joint opinion of the Venice Commission and OSCE/ODIHR on Republika Srpska’s draft law, indicates several areas
of concern due to non-compliance with international human rights standards. For instance, the Draft Law is not based
on any risk assessment or consultation with associations and others potentially affected. As mentioned by the Venice
Commission, legitimate reasons for imposing transparency requirements on private organisations include receiving
funding from public sources or performing essential democratic functions. Particular attention should be paid to
avoiding stigmatisation and duplication of existing registration and reporting obligations. Moreover, the joint opinion
stressed the need to ensure proportionality of sanctions and obligations and to provide effective remedies, in full
respect of fundamental rights, including the right to protection of personal data.
341
See note 210.
342
See note 125, paragraph 112.
343
See note 125, paragraph 114; Judgment of the ECtHR, Ecodefense v. Russia, see note 188, paragraph 81.
344
See note 182.
345
See note 125, paragraph 79.
172
conformity with the democratic values shared by the Union and its Member States pursuant
to Article 2 TEU.
With regard to the proportionality of the limitation, all 3 options apply indiscriminately
to any entity receiving financial support from abroad by reason of the type of activity
they carry out. In particular, the legislative policy options (PO2.1 and PO2.2) would not
cover any funding given by a third country entity346
, but only the funding which is related
to an interest representation activity (structural grants, donations, etc. are therefore
excluded). These legislative options only focus on the activities that are genuinely likely
to have a significant influence on public life and public debate. Secondly, none of the
policy options target specifically CSOs or other associations, significantly reducing the
risk of stigmatisation. They regulate a specific type of activity – interest representation
activities carried out on behalf of third country governments – regardless of the natural or
legal person carrying it out.
The legislative policy options (PO2.1 and PO2.2) contain specific safeguards to avoid
stigmatisation347
. By imposing a full harmonisation of the transparency requirements,
these 2 options ensure that registered entities may not be required to present themselves to
the public in a stigmatising manner348
.
The legislative policy options also include proportionate sanctions and a comprehensive
system of safeguards, including effective judicial review349
. These options would ensure
that CSOs and other associations would not be exposed to the threat of criminal penalties
or dissolution.
The targeted requirements included in the PO2.1 are proportionate and will not
overburden concerned entities. (i) In terms of record-keeping, the concerned entities would
be required to keep, for a limited period, a clearly defined set of information350
. (ii) In
terms of registration, the concerned entities would only be required to provide limited
information on themselves, the activities conducted, and the third country entities they
conduct the activities for. The registration would include an approximation351
of the
remuneration received. Only the information necessary for the application and oversight
346
Third country governments and entities whose action can be attributed to them, see section 5.2.1.
347
Firstly, the national public registers would have to be presented in a neutral manner and in such a way that it does
not lead to stigmatisation of the entities included in the register (e.g. Member States would be prevented from
requiring the entities that fall within the scope of the initiative to register ‘as an organisation in receipt of support
from abroad’ or indicate on their internet site and in their publications and other press material the information that
they are organisations in receipt of support from abroad). Secondly, Member States should ensure that when carrying
out their tasks, the national authorities ensure that no adverse consequences arise from the mere fact that an entity is
registered. Thirdly, the registered entities would be able to request that all or part of the information is not made
publicly available where there are overriding legitimate interests preventing publication.
348
Upon registration, these entities would only be required to provide their registration number in their contacts with
public officials, not the wider public.
349
Supervision would be entrusted to independent supervisory authorities with clearly established powers, whose
requests for further information would need to be motivated and subject to effective judicial remedy. Sanctions would
be designed in a way that would avoid a chilling effect on the concerned entities and sanction related powers subject
to appropriate safeguards, including the right to effective judicial review. They would be fully harmonised and
limited to administrative fines under a specific ceiling based on the entity’s economic capacity. Sanctions would only
be imposed following a prior early warning, except for breaches of the anti-circumvention clause.
350
These records would include information on the identity of the third country entity on whose behalf the activity is
carried out, a description of the purpose of the interest representation activity, contracts and key exchanges with the
third country entity to the extent that they are essential to understand the nature and purpose of the interest
representation carried out as well as information or material constituting key components of the interest
representation activity.
351
During the registration the precise amount would not be requested. Concerned entities would have to indicate in
which bracket (e.g.: EUR 25,000 < 50,000; or EUR 50,000 < 100,000) the remuneration would fall, this remuneration
would cover all the tasks carried out with the objective of influencing the development, formulation or
implementation of the same proposal. Information on the annual amounts declared would be made public within
wider brackets corresponding the level of detail necessary for the purpose of informing citizens their representatives
and other interested parties.
173
of the legislative initiative would need to be updated regularly. Other information would
only need to be updated annually. (iii) Apart from where it is necessary to examine non-
compliance with the registration requirements, registered entities can only be requested to
share their records with the supervisory authority as part of a risk-based approach where,
based on objective factors, they are particularly likely to have a significant influence on
public life and public debate. (iv) As illustrated in section 6.2.1.3 and Annexes 3 and 4, the
costs for private entities are not likely to render significantly more difficult the action or
operations of associations and are limited to what is necessary to ensure transparency.
The extended requirements included in the PO2.2 impose additional burdens on the
concerned entities as compared to the targeted requirements included in the PO2.1352
.
These additional provisions enhance the restrictions on the right to freedom of
association. Member States would be able to refuse granting a licence on the ground that
the activity is likely to seriously affect public security. While such measure would be
suitable to address threats to internal and external security, it would still place de facto
prior authorisation obligations on the mechanisms by which associations use certain
remunerations from third countries. Such measures could have a disproportionate impact
at the light of the objective that it seeks to achieve353
. Furthermore, this system of prior
authorisation would give Member States a certain leeway which could create a risk of
arbitrariness in the decisions to grant said licence. Finally, the fact that a publicly available
flag would be added in the registration of the entity who received a licence despite
comments submitted by a Member State or the Commission, could lead to stigmatisation
of the said entity.
The non-legislative option (PO1) would not provide for the extended requirements of the
PO2.2. However, it would only provide for recommendations, leaving Member States a
large room of manoeuvre to implement transparency requirements and would not ensure
the implementation of the safeguards provided by the legislative options.
352
These additional requirements includes: (i) a requirement to apply to national-level authorities for an EU-wide licence
to conduct interest representation activities on behalf of a third country entity; and (ii) a requirement to keep records
of all contracts and exchanges with the entity on whose behalf the activity is carried out as well as all information or
material on the interest representation activity
353
“As to the necessity and proportionality of measures taken to secure the above-mentioned aims, interference with the
right of associations to seek and obtain financial and material resources should be the least intrusive of all possible
means that could have been adopted. The authorities should be able to prove that the legitimate aim pursued by the
measure cannot be reached by any less intrusive measures. In particular, an outright ban on foreign funding, or
requiring prior authorisation from the authorities to receive or use such funds, is not justified.” Venice Commission
Report on Funding of Associations, CDL-AD(2019)002, paragraph 147; see also Report by the UN Special
Rapporteur on the rights to freedom of peaceful assembly and of association (A/HRC/50/23) paragraphs 20 to 22.
174
Annex 9: The baseline
The European Democracy Action Plan adopted in December 2020 set out specific
measures to promote free and fair elections and strong democratic participation, to support
free and independent media, and counter disinformation. With this Action Plan, the
Commission announced measures, both legislative and non-legislative to strengthen the
resilience of EU democracies.
This includes a proposal for legislation to ensure greater transparency in the area of
sponsored content in a political context (‘political advertising'), and a proposal for a
revision of the Regulation on the funding of European political parties and European
political foundations (EUPP/F)354
which are in ongoing negotiations.
Stakeholder views:
During the focus group with representatives of European political parties and foundations355
,
participants underscored the high level of transparency which applies to EUPP/F and raised the
question of providing a level playing field in terms of transparency requirements between entities
influencing decision-making processes.
It set up a new joint operational mechanism through the European Cooperation
Network on Elections to support the deployment of joint expert teams to counter threats
to electoral processes.
With regard to strengthening media freedom and media pluralism, under the European
Democracy Action Plan, a recommendation on the safety of journalists was presented in
2021 with a structured dialogue under the European News Media Forum, with Member
States, stakeholders and international organisations set up to prepare and implement the
Recommendation.
On strategic lawsuits against public participation (SLAPP), the Commission put forward a
recommendation356
and a Proposal for a Directive on protecting persons who engage
in public participation from SLAPP.
Other measures also included support for EU cooperation between national media
councils, other media self-regulatory bodies, independent media regulators and networks
of journalists, and initiatives promoting journalistic partnerships and standards. Measures
to support media pluralism also include the setting up of a Media Ownership Monitor pilot
project, promoting transparent and fair allocation of state advertising, fostering media
diversity and a European approach on the prominence of audiovisual media services of
general interest. In addition, in September 2022, the Commission put forward a Proposal
for a Regulation establishing a common framework for media services in the internal
market (European Media Freedom Act), which aims to address fragmented national
regulatory approaches related to media freedom and pluralism and editorial independence
to ensure the free provision of media services within the internal market. In particular, it
will provide for transparency measures regarding to media ownership, audience
measurement and state advertising.
In addition, the Audiovisual Media Services Directive357
aims to create and ensure the
proper functioning of a single market for audiovisual media services while contributing to
354
See note 17.
355
Focus group with European political parties and foundations of 21 March 2023.
356
See note 22.
357
See note 225.
175
the promotion of cultural diversity and providing an adequate level of consumer and child
protection.
On the EU's Toolbox for countering foreign information manipulation and interference
(FIMI), developed under the Democracy Action Plan and then reinstated by the Strategic
Compass358
, a set of initiatives and actions were proposed that allow for the imposing of
costs on perpetrators and putting in place a new protocol to strengthen existing
cooperation structures to fight foreign information manipulation and interference including
disinformation. In addition, the revision of the Code of Practice on Disinformation was
carried out by the Signatories and prospective Signatories on the basis of the Commission’s
detailed guidance on how to step up commitments and measures against disinformation,
and set up a robust framework for its monitoring. The strengthened Code of Practice was
presented in June 2022.
Since 2015, the European External Action Service significantly improved its capacity
to tackle foreign information manipulation and interference (FIMI), including
disinformation by, inter alia, developing structures such as the EU Rapid Alert System
on Disinformation, developing a comprehensive framework and methodology for
systematic collection of evidence of foreign information manipulation and interference
(FIMI) incidents and by strengthening strategic communications in the Eastern
Partnership, the Southern Neighbourhood and the Western Balkans. The EEAS, in a close
cooperation with the Commission and the Member States, is continuously strengthening
the EU’s Toolbox to tackle Foreign Information Manipulation and Interference (FIMI
Toolbox), to impose costs on the perpetrators.
The initiatives foreseen under the European Democracy Action Plan, in particular the
guidance on strengthening the Code of Practice on Disinformation and legislation to ensure
greater transparency in the area of sponsored content in a political context are
complementary to the measures that have been proposed under the Digital Services Act.
The Digital Services Act set out a horizontal framework for regulatory oversight,
accountability and transparency of the online space in response to the emerging risks. It
proposes rules to ensure greater accountability on how platforms moderate content, on
advertising and on algorithmic processes. Very large platforms will be obliged to assess
the risks their systems pose not only as regards illegal content and products. They will have
to do the same as regards systemic risks to the protection of public interests and
fundamental rights, public health and security. The Digital Services Act establishes a co-
regulatory backstop for the measures, which were included in the revised and strengthened
Code of Practice on Disinformation.
In 2022, as a deliverable of the Digital Education Action Plan, the Commission published
a set of guidelines for teachers and educators on tackling disinformation and promoting
digital literacy through education and training359
. They provide advice on how to use digital
technologies responsibly and how to assess student competences concerning digital
literacy. In particular, they focus on how to encourage young people to fact-check
information and think critically, and how to understand the ethical or economic dimensions
of disinformation.
358
More information on the EU’s Strategic Compass for Security and Defence available here:
https://www.eeas.europa.eu/eeas/strategic-compass-security-and-defence-1_en.
359
European Commission, Directorate-General for Education, Youth, Sport and Culture, Guidelines for teachers and
educators on tackling disinformation and promoting digital literacy through education and training, Publications
Office of the European Union, 2022.
176
Since 2022, the Commission has been making recommendations to Member States in the
context of the Rule of Law Reports, including on aspects relevant to interest
representation. For instance, in 2022, Denmark and Slovakia were recommended to
introduce rules on lobbying, while Romania was invited to introduce rules on lobbying for
Members of Parliament. Belgium was called to complete the legislative reform on
lobbying, establishing a framework including a transparency register and a legislative
footprint, covering both members of Parliament and Government. In the same year, Spain
was recommended to continue efforts to table legislation on lobbying, including the
establishment of a mandatory public register of lobbyists360
.
In 2023, the Commission noted in the context of the Rule of Law Reports that
developments in the area of lobbying continued, as some Member States revised their
lobbying transparency rules, in line with 2022 recommendations. For example, in Latvia,
a new lobbying law was adopted, which provides for the creation of a lobbying register. In
Estonia, the authorities have continued efforts to effectively implement the guidelines on
lobbying. Cyprus adopted an implementing regulation on lobbying, which clarifies the
procedure for declaring, recording, and publishing lobbying activities. In Lithuania,
current rules on lobbying gave positive results in terms of submitted declarations. The 2023
Rule of Law Report also addresses further recommendations to Member States related to
lobbying and interest representation, where recommendations from 2022 were not yet fully
addressed or new challenges have emerged361
.
Most recently, following up on the European Parliament resolution of 17 February 2022,
aiming to promote associations and other non-profit organisations in the Union in
completing the internal market, protecting their fundamental rights and fostering an EU
democratic space, the Commission put forward a Proposal for a Directive on European
cross-border associations.
When it comes to investments by third countries, the FDI Screening Regulation362
,
provides an EU framework for the screening of direct investments from third countries on
the grounds of security or public order; while Regulation (EU) 2022/2560 on Foreign
Subsidies Distorting the Internal Market, aims to establish a harmonised framework to
address distortions of competition caused, directly or indirectly, by foreign subsidies.
Under the 2020 EU Cybersecurity Strategy, the Commission adopted several measures to
bolster Europe's collective resilience against cyber threats, including by third countries,
and help to ensure that citizens and businesses can fully benefit from trustworthy and
reliable services and digital tools: the NIS 2 Directive363
sets out a common cybersecurity
regulatory framework aiming to enhance the level of cybersecurity in the European Union,
requiring Member States to strengthen cybersecurity capabilities, and introducing
cybersecurity risk-management measures and reporting in critical sectors, along with rules
on cooperation, information sharing, supervision, and enforcement; the Critical Entities
Resilience (CER) Directive364
aims to reduce vulnerabilities and strengthen the physical
resilience of critical entities in the Union to ensure the uninterrupted provision of services
that are essential for the economy and society. It covers digital infrastructures, including
electronic communications services, data centres and public administration. The work of
360
In the 2022 Rule of Law Report, further recommendations on lobbying concerned DE, EE, IE, FR, HR,
IT, LV, LU, HU, NL and PL.
361
Further recommendations related to lobbying concern DE, CZ, DK, DE, IE, ES, FR, HR, IT, LV, LU,
HU, NL, AT, PL, RO and SK.
362
See note 23.
363
The NIS 2 Directive, see note 24.
364
Directive (EU) 2022/2557 on the resilience of critical entities.
177
the Commission is also supported by ENISA, the European Union Agency for
Cybersecurity. Additional work is ongoing on the proposal for a Cyber Resilience Act365
,
which lays down rules for the placing on the market of products with digital elements to
ensure the cybersecurity of such products, setting out essential requirements, obligations
for economic operators and rules on market surveillance.
In the financial sector, the DORA Regulation,366
entered into force in January 2023, aims
at strengthening the IT security of financial entities such as banks, insurance companies
and investment firms and making sure that the financial sector in Europe is able to stay
resilient in the event of a severe operational disruption. In the field of anti-money
laundering, negotiations are ongoing on a package of legislative proposals: the EU “single
rulebook” – regulation – with provisions on conducting due diligence on customers,
transparency of beneficial owners and the use of anonymous instruments, such as crypto-
assets, and new entities, such as crowdfunding platforms; the 6th
Anti-Money Laundering
Directive, containing national provisions on supervision and Financial Intelligence Units,
as well as on access for competent authorities to necessary and reliable information, e.g.
beneficial ownership registers and assets stored in free zones and the regulation
establishing the European Anti-Money Laundering Authority (AMLA) with supervisory
and investigative powers to ensure compliance with AML/CFT requirements.
The anti-corruption package, include: i) a joint communication on EU anti-corruption
policy; and ii) a proposal for a Directive on combating corruption and iii) Expanding the
Common Foreign and Security Policy (CFSP) sanctions toolbox to cover serious acts of
corruption, which seeks to protect democracy as well as society from the corrosive impact
of corruption. These initiatives will update the Union legal framework on corruption to
ensure compliance with international standards such as the United Nations Convention
Against Corruption (UNCAC). They will ensure a level playing field between Member
States, as well as coordination and common standards on the fight against corruption. In
particular, the proposal for a Directive includes as an aggravating circumstance for the
offences of bribery, misappropriation, trading in influence, abuse of functions, obstruction
of justice, enrichment form corruption, and incitement, aiding and abetting and attempt,
when the offender committed these offences for the benefit of a third country.
Directive (EU) 2022/2464 on corporate sustainability reporting367, empowers the
Commission to adopt delegated and implementing acts to specify how competent
authorities and market participants shall comply with the obligations laid down in the
Directive. It contains annual reporting obligations that include one governance standard
(business conduct) which would be relevant for this initiative.
The Commission also provide a wide range of funding opportunities to foster access to
democratic participation, civic engagement, and trust in democracy, most notably in the
context of the Citizens, Equality, Rights and Values (CERV) funding programme, the
Creative Europe programme, Erasmus+ and Horizon Europe. Actions to help tackle
disinformation through funding are supported in the current financing period under
Erasmus+, European Solidarity Corps and the Media programme, Citizens, Equality,
Rights and Values programme and Horizon Europe.
365
Proposal for a Regulation on horizontal cybersecurity requirements for products with digital elements and amending
Regulation (EU) 2019/1020.
366
DORA Regulation, see note 24.
367
See note 238.