Ethics watchdogs bite at European lobbying rules

A coalition of public interest groups is calling for tougher disclosure requirements for lobbyists, but not in Washington. These groups are pushing for tougher rules in Brussels.

Reform advocates say new rules the European Commission (EC) intends to impose on June 23 do not go far enough. They argue the requirements are toothless because they are voluntary, and present several loopholes for lobbyists to step through and avoid public disclosure.

{mosads}“It simply does not deliver in terms of what the commission has stated it wants its lobbying disclosure system to do: inform EU citizens about who lobbies, on whose behalf and with which budgets,” Olivier Hoedeman of the Corporate Europe Observatory, a watchdog group based in Amsterdam, wrote in an e-mail to The Hill.

The new regulations could impact a number of prominent American firms that are already lobbying the EC, the executive branch of the European Union. The EC drafts proposals for laws that must be approved by the European Council and Parliament, and also runs the EU’s day-to-day operations.

The European Parliament already has a set of rules for lobbyists, but watchdog groups say it is even weaker than the proposed rules for the EC.

U.S. firms actively lobbying in Brussels include Dutko Worldwide, the U.S. Chamber of Commerce and public relations giants APCO Worldwide and Burson-Marsteller.

The new EC regulations are the product of three years of preparation, and include an online, voluntary registry where lobbyists are expected to sign up and disclose their clients. European officials said the registry was in response to what has become a booming industry in the Belgian capital.

“The lobby sector is a relatively new phenomenon for us,” said Anthony Smallwood, a spokesman for the European Union’s Washington delegation. “We never had such a concentration of a highly skilled lobbying industry anywhere else in Europe. It has happened rather suddenly here in Brussels.”

Criticism of the registry has grown over the last month. The disclosure requirements were described as falling “far short of the objective” of transparency in a letter in late May to EC President Jose Manuel Barroso by Craig Holman, campaign finance lobbyist for Public Citizen.

EU civil society groups have pressed Barroso to intervene. Friends of the Earth , an environmentalist organization, started an e-mail campaign, while the Alliance for Lobbying Transparency and Ethics Regulation , a coalition of civil society groups and academics, asked him to “ensure that the commission’s new register for lobbyists will deliver transparency.”

Commission officials have rejected the criticism, insisting they are serious about shedding more light on the activities of lobbyists in Brussels.

“Our register will definitely produce added value compared to the current situation,” said Kristian Schmidt, an EC aide to Siim Kallas, the EC vice president who led the initiative.

The influence profession is different in Brussels, lobbyists and European officials said. While lobbying firms generally raise funds for members of Congress, commissioners do not need to fundraise in order to be in office, which EU officials said lowers the chance of pay-to-play corruption.

“There are no EU scandals comparable to the Abramoff incident,” said Schmidt. “The U.S. experience is an inspiration, but not a model. Washington and Brussels are not comparable political systems, even if the lobby intensity is high in both cities.”

“There is no such thing as party or political contributions,” said Thomas Tindemans, head of White & Case’s Brussels office. “Unfortunately, you have to win by argument. If we could pay, that would just be easier,” he joked.

Information is the currency for lobbyists in Brussels, these sources said, as European lawmakers do not have access to institutions similar to the Congressional Research Service or the Government Accountability Office, which research and publish reports on issues at the request of members of Congress.

Holman and others, however, said there’s potential for corruption.

In his letter to Barroso, Holman argued that reporting by lobbyists should be mandatory, as it is in the U.S. He also said the thresholds for which lobbyists must report financial activity are too high. Under the proposed law, lobbyists do not have to report their work until they are paid at least 50,000 euros, about $77,000 at the current exchange rate.

Also, since the entire system is voluntary, clients can just tell their lobbyists not to report anything. For example, Tindemans is asking his clients if they would object to being registered under the EC’s new requirements.

Those lobbying the European Parliament have to adhere to a code of conduct and sign up for access badges. A list of badge-holders is made public, but their clients are not disclosed.

The EP has since taken a tougher stance, according to watchdogs. In a resolution passed in early May, the EP called for mandatory disclosure by lobbyists, along with a detailing of their finances, for all European bodies they lobby.

Schmidt described the EC’s rules as a first step that could be strengthened.

“We have given ourselves a year to test whether the profession deserves our trust — if not, the door towards mandatory registration remains open,” he said.