European Interest

A new tool to safeguard the EU’s interests

"This is a big step forward for the EU, to stand up against economic blackmail," said Bernd Lange, rapporteur and Chair of the Committee on International Trade.

During the fourth and final trilogue with EU governments and the Commission on the proposed anti-coercion instrument, EP negotiators on Tuesday morning confirmed with Council their improvements to the new draft law. They managed to strengthen its deterrent nature by having a full list of possible responses in the Annex. In addition, timelines for the whole procedure and, in particular, for adopting a response to a non-EU country’s attempt to coerce, were added upon request of the EP to ensure that the instrument is applied in a swift manner.

Bernd Lange (S&D, DE), rapporteur and Chair of the Committee on International Trade, said after the final trilogue: “This is a big step forward for the EU, to stand up against economic blackmail. We do not know exactly what future coercion will look like, but we know how the EU can respond: swiftly, seriously, and speaking with one voice. Taking countermeasures is a last resort, but if necessary we are ready to assert European sovereignty from a full arsenal of measures. It is now time for this regulation to enter into force and the EU to continue taking the lead globally with like-minded partners.”

Uphold the European Union’s interest

The new tool is designed to protect the EU’s strategic and economic interests. It will enable the EU to respond, in line with international law, if it or a member state experiences economic blackmail by a non-EU country trying to influence a particular policy choice or stance, such as parliamentary resolutions. The primary goal of the new instrument is to dissuade non-EU countries from attempting to coerce or to get them to halt coercion, including threats, and avoid escalating the conflict. Recently, G7 leaders announced the launch of a coordination platform against economic coercion, echoing the EU’s initiative and confirming its necessity.

MEPs accepted that the Council will decide formally about the existence of coercion based on Commission’s findings, since the exceptional nature of this new instrument justifies it. However, democratic controls were introduced by the EP at every stage, on the content and on the process. The EP also managed to keep a broad list of possible EU responses as part of the new tool, stressing that its use must be a last resort, without excluding other avenues, including direct negotiations with the coercing country and cooperation with other countries coerced.

Repair the injury

Parliament’s negotiators obtained an extension to the scope of the proposed legislation to include measures to repair the injury caused by coercion, where so requested.

Binding deadlines

MEPs also introduced deadlines for determining whether coercion has occurred and for adopting a response to it, to make sure the procedure is nimble enough to avoid administrative delays and to ensure legal certainly for operators.

Democratic scrutiny

Parliament also strengthened the democratic scrutiny of the new tool’s application, ensuring that MEPs will be kept informed together with the Council at all relevant stages, from the examination of a case to the continuous review of the EU measures. A contact point in the Commission will ensure coordination and transparency and the new concepts introduced by this instrument have been defined.

With the final text now endorsed by the negotiators from both sides, the informal agreement will have to be formally approved by Parliament and Council (member states) before it can enter into force. The vote is foreseen in INTA at its next meeting at the end of June.

The Commission published its proposal about the anti-coercion instrument on 8 December 2021, upon the request of the Parliament and the Council. The new deterrent fills a gap in the EU toolkit to deal with countries trying to restrict trade or investment in order to force a change in various EU policies.

Parliament denounced in several resolutions the People’s Republic of China’s economic coercion of Lithuania in response to a Lithuanian policy decision, among others, in JanuaryFebruary and September 2022.

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