Next week will be a plenary week for the Members of the European Parliament (“MEPs”). Due to the restrictions in place to tackle COVID-19, the plenary sessions will be held virtually. Several interesting debates are scheduled to take place.
On Wednesday, MEPs will debate with the Council of the EU and European Commission on protecting European strategic sectors from foreign takeovers in a post-Covid world. On May 17, 2020, Manfred Weber (DE, EPP), a prominent MEP from the center-right European People’s Party, told Germany’s Welt am Sonntag in an interview that he is considering proposing a twelve-month ban on merger and acquisitions from China to stop the “Chinese shopping tour”. It is speculated that there is a (slim) majority in the Parliament in favor of such plans. However, it remains highly uncertain whether the EU has the competence to impose such discriminatory restrictions on the free movement of capital and freedom of establishment. Previously, on March 25, 2020, the Commission issued guidelines to protect and coordinate the screening by Member States of foreign investments. In the guidelines, the Commission highlighted the possible risks of the current economic shock and potential risk to strategic industries, such as in particular healthcare-related industries. The Commission also called on Member States that did not have such a screening regime in place to establish one. Similarly, Competition Commissioner Vestager will next week present a new tool to prevent foreign state-sponsored takeovers that distort competition inside the EU. A draft indicates that non-EU investors would have to notify acquisitions of more than 35 percent of an EU company to assess whether the acquisition is conform to market terms.
On Thursday, the Commission Vice-President and High Representative of the EU Josep Borrell will make a statement regarding China’s national security law for Hong Kong and the need for the EU to defend Hong Kong’s high degree of autonomy. Until now, unlike his U.S. counterparts, Borrell has been reluctant to formally condemn China’s national security law, but has expressed “grave concerns” over the law. On May 29, 2020, in a virtual meeting of the foreign ministers of the Member States, he agreed that sanctions would not solve the problems and that the EU needs a “more robust” strategy to counter China’s assertiveness. After the debate, MEPs will draft a resolution and vote on a final version on Friday.
Also on Thursday, MEPs will vote to set up a special committee on foreign interference in all democratic processes in the EU, including disinformation. On June 10, 2020, Commission Vice-President Jourová presented a Communication “Tackling COVID-19 disinformation” that accused Russia and China of engaging in targeted influence operations and disinformation campaigns around COVID-19 in the EU and globally. The Communication claims that they were seeking to undermine democratic debate and exacerbate social polarization to improve their own image. Commissioner Jourová also called for the strengthening of the EU’s existing mechanisms and for dedicating a section in the Rapid Alert System to facilitate the exchange of COVID-19 relevant communication material. The scope and powers of the potential special committee remain uncertain.
For the complete agenda and overview of the meetings, please see here.