European Parliament sues Council over €150 billion defence loan scheme
In a bid to boost Europe's defence industry and incentivise EU states to rearm, the European Commission activated an emergency procedure to bypass the Parliament, dissatisfaction of its elected officials.
'The Parliament has today (20 August) lodged a request with the Court of Justice for the annulment of the SAFE regulation,' its press service told Euractiv.
SAFE, a €150 billion defence loan programme, was proposed by Commission President Ursula von der Leyen in March to stimulate spending as soon as possible. In May, EU ministers gave their final approval, without consulting the European Parliament.
Eighteen EU countries have thus far formally expressed interest in taking out loans for bids amounting to at least €127 billion.
While the Parliament stresses that the 'instrument has the full support of Parliament [...] It is about the legal basis that was chosen, which undermines democratic legitimacy.'
To skip parliamentary approval, von der Leyen wielded a part of the EU treaties (Article 122 TFEU), normally reserved for emergencies such as the Covid-19 pandemic, which speeds up the legislative process by reducing Parliament's negotiation time significantly.
'The use of Article 122 for SAFE as a legal basis was, in Parliament's view, procedurally incorrect and simply unnecessary. It undermines democratic legitimacy in the eyes of the public, and there is no Parliament in the world that would accept that,' the Parliament's press service told Euractiv.
'That is why, Parliament brings a case on grounds of inadequate legal basis.'
In a letter to von der Leyen, the Parliament's President Roberta Metsola warned in May that the Commission could be taken to court. Von der Leyen rejected the complaint, arguing that using the emergency clause is 'fully justified' as SAFE is 'an exceptional and temporary response to an urgent and existential challenge'.
EU countries, which are counting on the loans, are still in the clear for now. In its request to the Court, the Parliament asked to maintain the effects of the regulation until a replacement is adopted.
(cp)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Euractiv
4 hours ago
- Euractiv
EU-US trade statement targets ‘unjustified' digital trade barriers
With their joint statement, the European Union and the US on Thursday put some meat on the bones of their July trade agreement but remain notably vague on digital commitments. The statement comes after a widely criticised political agreement EU Commission President von der Leyen and US President Trump struck last July in a bid to avert a full-blown trade war. But it looks unlikely to smoothen the negative perception of the deal, as it commits the EU to a number of concessions in the digital arena. The EU and the US 'commit to address unjustified digital trade barriers' – a new line likely to be leapt upon by EU lawmakers. It raises questions about which tech policies might be targeted, especially given the US' public hostility to a swathe of EU tech laws including the bloc's digital governance rules and AI Act. DMA, DSA, DSTs untouched The bloc's Digital Markets Act (DMA), Digital Services Act (DSA) and digital services taxes (DSTs) are not included, the EU's trade chief Maroš Šefčovič told press on Thursday. 'We kept those issues out of the trade negotiations,' Šefčovič emphasised. Even though there is no pan-EU DST, several member countries have brought in their own DSTs and others, including Poland, look set to follow. While the Commission has repeatedly said its digital rulebook was off the trade-talk-table, the US administration has on the contrary suggested that existing EU digital laws were indeed very much on the menu. The statement does not directly reference the EU's DSA and DMA – including not explicitly stating the EU's claim that the flagship laws remain untouched by the deal. No network usage fees In one notable concession, the statement says the EU will not be adopting or maintaining network usage fees, which the Commissioner confirmed on Thursday. Network usage fees have been heavily lobbied for by EU telcos. They want to be able to charge the largest tech platforms – most of which are US companies – for carrying their traffic. While the Commission had already backed away from supporting telcos' original "fair share" proposal, it left the door open to the upcoming Digital Networks Act – including dispute resolution mechanisms for telecom regulatory authorities. Big Tech lobbyists have warned that this could be an indirect way of imposing network fees. It remains unclear whether the EU's commitment in today's statement shuts off that possibility, too. Seeking to put a positive spin on the EU agreeing not to bring in network usage fees, Šefčovič said: 'What we're actually doing here is creating the conducive space for enhancing... the digital trading possibilities between EU and US.' US traders to get a say on customs reform Plenty more digital detail remains vague, even as trade talks continue. Šefčovič acknowledged that the EU-US relationship is 'vast'. 'There will be a lot of issues which will be discussed,' he said in reference to future talks with the US. 'But we, of course, been very clear that, for us, the regulatory autonomy is absolutely important.' Despite Šefčovič's claim, the statement includes a concession that the EU 'intends to consult' with the US and US traders on digitalising trade procedures and implementing the EU customs reform, which is currently still being negotiated. The EU and US also aim to negotiate a mutual recognition agreement on cybersecurity. EU to purchase US-made AI chips The EU 'intends to purchase' at least €40 billion worth of US-made AI chips, the statement also reads. The chips are earmarked for the EU's 'computing centres' but the EU has so far failed to make clear who will foot the bill. As a prerequisite for such imports, the EU also said it will work with the US on controlling 'technology leakage' to certain destinations. The US administration has committed to a 15% cap on tariffs, which seems to cement the EU's belief it escaped the 100% chip levy Trump threatened just a few weeks ago. Both sides said they will not impose customs duties on electronic transmissions and will support a permanent ban on them. The subject has been negotiated for years at the World Trade Organisation and led to the EU and China – but not the US – to previously agree a ban. Today's statement commits the EU and US to 'seek the adoption of a permanent multilateral commitment" to avoid these duties globally. Not legally binding – yet The Thursday statement isn't legally binding as both administrations need to convert the proposals into legal texts. On the EU-side, it means the Commission needs to negotiate with the other EU institutions, the Parliament, and Council. "It's impossible to talk about a fair deal," the Parliament's trade committee chair Bernd Lange said. In addition, the EU-US trade talks are still continuing to work through more detail, as the EU's trade chief signalled again today. Euractiv's Natasha Lomas contributed reporting (nl, vib)
Euractiv
6 hours ago
- Euractiv
Russia rules out European force for Ukraine
Russian foreign minister Sergei Lavrov has ruled out the deployment of foreign troops to Ukraine in any potential peace settlement, a refusal that will complicate and possibly derail the fledgling US-led effort to end the conflict. The comments, which Lavrov made during a meeting with India's Foreign Minister in Moscow, came after a week of intense diplomacy between American and European leaders over security guarantees for Kyiv ahead of a possible trilateral peace summit between the US, Russia, and Ukraine in the coming weeks. Central to those security guarantees is the idea of a 'reassurance force' made up of soldiers from European countries, who would serve as a deterrent to any future Russian attack. But on Thursday Lavrov said Moscow has always viewed foreign troops in Ukraine as "absolutely unacceptable for Russia" according to Russian state-controlled media TASS . Instead, the Russian foreign minister points to a communiqué drafted by the war parties in the first weeks of the full-scale invasion back in 2022 as the basis for security guarantees. This so-called Istanbul communiqué would mean Ukraine "does not join any military alliances, does not deploy foreign military bases and contingents". It would also force Ukraine to self-declare as a "permanently neutral state", effectively meaning it cannot align with Europe or NATO in any way. Discussions on the communiqué were broken off after evidence of extensive war crimes was discovered in the liberated Ukrainian towns of Irpin and Bucha in April 2022. EU Defence Commissioner Andrius Kubilius has already reacted on Bluesky, questioning who is "the real boss in [the] Kremlin?" and pointing out that Lavrov's view seems to not match that of his boss, Vladimir Putin. (mk)
Euractiv
6 hours ago
- Euractiv
Defence not exempt from Trump tariff pain
Today's joint framework on an EU-US deal over tariffs remains as vague as it was when the original announcement was made in July, but the Commission has confirmed there will be no blanket exemption for defence equipment. US President Donald Trump said at the end of July that the EU would buy 'vast amounts' of defence equipment as part of a trade deal. The announcement raised eyebrows in a Europe looking to reduce its dependence on American defence companies, and left Europe's defence industry wondering how exactly the tariffs will impact the sector. 'Defence equipment will not be excluded from the US tariffs,' a senior EU official told the media on Thursday, but added that more tariff 'carve-outs' are expected since the US is interested in 'certain weapon systems' and semiconductors. The joint framework caps US tariffs on European goods at 15%, but includes exemptions for specific goods, including aircraft and aircraft parts. Tariffs on cars and car parts will also fall from 27.5% to 15%, but only once the Commission has presented a proposal to lift tariffs on US industrial goods. Both sides plan to cooperate on steel and aluminium overcapacity. So far, all of this matches the announcement made in July. The joint framework also confirms in writing Trump's earlier claim about EU spending on American military equipment. 'The European Union plans to substantially increase procurement of military and defence equipment from the United States, with the support and facilitation of the US government', reads the statement. However, there are no details on this promise because the European Commission, which negotiated the tariffs, has no authority over the arms procurement of EU countries, as it is a longstanding matter of national sovereignty. A different EU official stated that this increase 'is certainly not for the Commission to enforce, but it is something that we have discussed in detail with our member states and therefore we were able to frame it as such in the joint statement.' The official added that the text does not specify any amount, keeping the pledge to increase defence and military expenditure generic. (cp)
