None. There is no regulation requiring former MEPs to seek authorisation for their subsequent activities.
Olle Schmidt served his first mandate at the European Parliament from 1999 to 2004, he returned in 2006 to replace Cecilia Malmström and stayed until the 2014 elections. He also served as a member of the bureau of the ALDE group in the parliament and remains as Vice-President of the ALDE party to this day.
While an MEP, Schmidt was an active member of the economic and monetary affairs (ECON) committee in a time marked by a flurry of financial and banking regulation as the EU institutions responded to the crisis. Schmidt was also a member of the Special Committee on the Financial, Economic and Social Crisis (2009-2011).
Prior to being elected to the EP, Schmidt was a member of the Swedish Parliament (1991-1994), member of the Folkpartiet liberalerna executive, member of Malmö city council and member of Malmö municipal executive board.
Whilst a member of ECON, Schmidt worked on an extensive list of regulatory proposals for the financial industry. For instance, he was the shadow rapporteur on the controversial markets in financial instruments repealing directive. Most notably, he wrote the ECON's response to the Commission's proposal to set up an investor compensation scheme back in 2011. His amendments to the proposal raised the level of protection to €100,000 but lowered the Commission's target of having the industry-funded compensation scheme from 0.5 per cent in ten years to 0.3 per cent in five years. According to the Financial Times, the Investment Management Association had been highly critical of the original target set by the Commission. This proposal has been stalled by political in-fighting ever since and is now on the Commission's list of proposals which should be withdrawn.
Schmidt was also one of the founding members European Parliamentary Financial Services Forum (EPFSF), a cross-party group that joins MEPs interested in financial issues with outside interests, in this case, mostly the financial industry. Research from Corporate Europe Observatory (CEO) has shown how such groups provide opportunities for 'under the radar' lobbying. The EPFSF's membership is divided into three groups, the steering committee composed by MEPs, the financial industry committee, and observers.
Nowadays, the financial industry committee is chaired by the European Fund and Asset Management Association (EFAMA) and counts with the participation of Goldman Sachs International, HSBC and the Association for Financial Markets in Europe. Previous chairs of the financial industry committee included the Federation of European Securities Exchange (FESE).
Whilst an MEP Schmidt was criticised several times for following the line of the financial industry. In 2011, CEO found that during the discussion on the Commission's proposal to regulate the controversial derivative financial product, Credit Default Swaps, Schmidt had tabled several amendments that were identical to those tabled by MEPs from other political groups. These amendments promoted a general reduction of the strength of the proposed regulation and of transparency of the market, closely following the positions advocated by FESE.
A Reuters report similarly found that amendments tabled by Schmidt on hedge fund regulation followed the same line as the one defended by the Association for Financial Markets in Europe (AFME), “Europe's chief investment banking lobby groups which represents Deustche, Goldman Sachs, Barclays and others.” The Austrian Federal Chamber of Labour raised similar concerns about Schmidt's position during the discussion of the European Financial Transaction Tax. Also in 2011, europaportalen.se found that among the 12 Swedish MEPs surveyed, Schmidt was the one who had the most meetings with lobbyists during a four week period, with virtually all representing corporate interests.
After standing down in 2014, Schmidt returned to the city council of Malmo. However, last April 2015 the lobbying consultancy firm Hume Brophy announced that it had appointed Schmidt as senior consultant. According to the firm's press release, Schmidt is to “provide strategic counsel and advice to Hume Brophy’s financial services clients”.
Hume Brophy's lobby register discloses that, from September 2013 to August 2014, it spent between €1,750,000 - €1,999,999 on EU lobbying. Its client list is diverse but includes several financial services firms, such as the Bank of New York Mellon, the European Fund & Asset Management Association (EFAMA) and the Alternative Investment Management Association (AIMA), each of whom provide Hume Brophy with an annual lobby revenue of €100,000 - €199,999.
Founding partner John Hume commented on Schmidt's appointment that:
“We are delighted to have Olle on board. He brings decades of national and European political experience to our clients. His expertise in financial services will be much sought after amongst our clients and partners.”
In response to CEO's enquiries, Schmidt declared that:
“I have always been a strong advocate of transparency in my capacity as elected politician. During my years in the EP I provided press and stakeholders with those documents they were looking for. The main reason for me joining HB is the system with trilogues, a nontransperent system that I always been criticizing for being very difficult for those outside to follow and to understand.”
“I joined HB in April 2015 to focus on the financial sector, consumer’s rights, retail sector, sports, and transport. As a member of the HB’s public affairs team I provide services to a range of clients including confederations, sports federations and a TV channel.”
Soon after joining the lobbying firm, Schmidt hosted a breakfast with business at Hume Brophy where trade Commissioner Malmström, also a member of the Swedish Folkpartiet party, gave a briefing on trade issues. According to the invite sent to the commissioner, Hume Brophy's breakfast aimed at:
“gathering participants from 25-30 businesses across a range of sectors including transport, food, agriculture, healthcare and consumer goods. This would provide you with a platform to talk about TTIP or other potential topics or initiatives which you may want to explore with a targeted business audience.”
As CEO has previously reported, Schmidt's recruitment by Hume Brophy follows that of former MEPs Gary Titley, George Lyon and Brian Simpson. Together they form what the lobbying firm has called its “parliamentary team”. John Hume, founding partner of Hume Brophy, announced this new team saying that:
“Our team of full time consultants have strong institutional links and experience across Brussels and member states. They are also able to draw on our teams in London, Dublin, Paris and Singapore, but nothing can substitute actual parliamentary experience to guide our partners though the often difficult challenges of seeking support from the European Parliament”.
Schmidt's move into the financial industry follows that of fellow former ECON members Sharon Bowles, Arlene McCarthy, Corien Wortmann-Kool, Peter Skinner, Piia-Noora Kauppi and Emilie Turunen.
See Schmidt's full reply here .
The rules in the European Parliament
The code of conduct for MEPs (approved in 2011) states that “Former Members of the European Parliament who engage in professional lobbying or representational activities directly linked to the European Union decision-making process may not, throughout the period in which they engage in those activities, benefit from the facilities granted to former Members under the rules laid down by the Bureau to that effect”.
Schmidt holds a European Parliament lobby pass on behalf of Hume Brophy.
When MEPs leave the European parliament they are entitled to a transitional allowance equivalent to one month's salary for every year they have been an MEP, with a minimum pay-out of six months' salary and a maximum of 24 months.
“Schmidt's new role as a lobbyist for the financial industry is another shocking example of how private consultancy lobby firms are taking advantage of the lack of revolving doors rules in the European Parliament. Former MEPs have substantial parliamentary know-how and networks and they should not be able to work as lobbyists so soon after leaving office.
Schmidt's move is part of a trend by former ECON members and, in CEO's view, it reinforces the urgency for a stronger MEP code of conduct to include safeguards against such shocking revolving door cases.”