EU can learn lobbygate lessons from rules elsewhere

 “The Dalli case shows the system works,” an EU official told a public debate in Brussels last week, following a question on whether new ethics and transparency reforms will follow the Dalli-gate lobby scandal. The Commission is clearly in denial. The ex-Commissioner's resignation may still be shrouded in mystery, but the need for greater transparency and tighter rules to prevent undue influence could not be more clear. A quick look at lobby transparency systems in Canada and elsewhere can be instructive on this. CEO argues that a more robust, mandatory and better implemented system of lobby transparency in the EU would have prevented an unregistered lobbyist embroiling a high-level policy maker in a cash for access scandal.

Faced with cash-for-influence scandals against a backdrop of behind-closed-doors ties with big business, the European Commission could take inspiration from several existing lobby laws. Canada for example offers a model that could help prevent scandals like Dalli-gate from happening again.

Canada: rules with teeth

The Lobbying Act has been law in Canada since 1988, and is premised on the idea that transparency and disclosure lead to public confidence and official accountability, and that public office holders should know who is trying to influence them. Lobbyists must report monthly on their lobbying activities, including the names of the officials contacted and the subjects discussed. Lobby consultancies must also report the names of the lobbyists involved.

The Canadian Lobbying Act, unlike the US system includes a lobbyist code of conduct, which has legal effect. The code requires that lobbyists “shall not place public office holders in a conflict of interest by proposing or undertaking any action that would constitute an improper influence on a public office holder”. Guidelines clarify that this includes both the appearance of, and real, conflicts of interest. These “can be created by the presence of a tension between the public office holder's duty to serve the public interest and his or her private interest or obligation created or facilitated by the lobbyist.” Had there been such a strongly worded code in place for EU lobbyists, it would have been clear that the Maltese entrepreneur Silvio Zammit's attempts to earn money by setting up meetings with the then health Commissioner John Dalli were gross violations. The EU's code of conduct, which lobbyists agree to when they sign up to the voluntary Transparency Register, is vaguely worded and lacks effective enforcement mechanisms.

Earlier this month, the ALTER-EU coalition wrote to Commission President Jose Manuel Barroso calling for "stricter and mandatory ethics rules for lobbyists". The letter pointed out that “the current Code of Conduct […] lacks teeth”, partly because it is “heavily based on the codes developed by the interest groups of Brussels-based commercial lobbyists SEAP and EPACA”. The review of the Transparency Register in 2013 provides an excellent opportunity for an overhaul of the current code of conduct to secure far clearer, stricter and more enforceable ethics rules for EU lobbyists.

In Canada, an independent office (referred to as the Commissioner of Lobbying) is in charge of implementing the code, and has the same powers as a court to compel persons to give oral or written evidence under oath, or produce documents and materials relevant to an investigation. The Commissioner can notify the police of suspected violations, for possible prosecution or advise Parliament of violations discovered in her investigations. Any resulting adverse publicity serves as a partial sanction and deterrent to others, but there are also legal sanctions for violations, including fines and, in appropriate cases, imprisonment. Violations can result in prohibiting the lobbyist from communicating with public office holders for up to two years. The EU's fraud office OLAF in contrast is only responsible for investigating fraud relating to the EU budget, which means the EU institutions lack an equivalent independent ethics body with enforcement powers.

Lessons from within Europe

There are also legislative systems within Europe that could have helped prevent Dalligate. Austria has now adopted a mandatory lobbyist register, which, like Canada's, includes a lobbyists' code of conduct that when violated can result in suspension of lobbying activities and contracts.

Another lesson comes from Slovenia, where their mandatory and far-reaching system requires officials to report all lobbying contacts, which are then posted online. Poland's system, although weak overall, also requires officials to maintain records of lobbying contacts, published annually. The requirement for officials to pro-actively release lists of their lobby meetings would have enabled much greater clarity around, and scrutiny of, the lobbyists that ex-Commissioner Dalli was engaging with.

Why is the EU's system conducive to lobby scandals like Dalligate?

From the models described above, it is easy enough to identify elements that, if they were part of the EU's lobby transparency system, would have prevented a scandal such as Dalligate, and/or made the continued mystery surrounding it impossible. These include:

  • A legally enforceable ethics code, which restricts “the most egregious patterns of undue influence peddling – generally focused on the potentially corrupting nexus between lobbyists, money and lawmakers – should govern the behaviour of lobbyists and governmental officials alike.” The lobbyists' code of conduct in Canada, which has legal effect, should prevent lobbyists putting officials in situations of real or apparent conflicts of interest, and if they do, ensure appropriate sanctions are put in place.
  • Pro-active transparency from policy-makers about who they are meeting or having contacts with. Examples of this are found in the Slovenian system, and in the otherwise weak Polish system. The UK also requires government ministries to publish quarterly reports of meetings.
  • If the EU lobby registry were mandatory, as in Canada, Slovenia and Austria, then there would have been no “unregistered lobbyists” - lobbyists allowed to choose not to register, reveal their clients or their spending – to meet with in the first place.

* For the complete background, and references, for this article, see “Lobbying and transparency: A comparative analysis of regulatory reform”, Craig Holman and William Luneburg, 2012, http://www.palgrave-journals.com/iga/journal/v1/n1/full/iga20124a.html