After the election of the new European Parliament on May 24-26, the European Council met three times to discuss the package of appointments of EU’s new leaders (see our blog ‘elections and appointments in the European Union’ …) .

The white smoke came on Tuesday July 2 with the selection of new presidents for the European Commission, the European Council and the European Central bank as well as the High Representative for Foreign affairs. The day after, on July 3, the European Parliament elected its new president.

The new Parliament, on July 16, ‘elected’ Ursula von der Leyen as president of the EU Commission, confirming the choice made by the European Council.  The new European Commission will be assembled over the summer, in time for hearings in the Fall, before they take office on November 1.

 A Team of Convinced Europeans

The new leaders selected by the European Council have one characteristic in common: they are all convinced Europeans, favoring further EU integration and a leading role for EU and other multilateral institutions. This is noteworthy, at a time when nationalism, populism and euroscepticism seemed to have gained ground in many European countries. The message is that there is still a strong majority for the continuation of an ambitious European project.

  • Ursula von der Leyen, appointed to succeed Jean-Claude Juncker as president of the EU Commission, is a close ally of Angela Merkel since her first term as chancellor. As German Defense minister she was a strong promotor of European defense: “Europe’s army is already taking shape,” she said recently. In 2016, she published a very ambitious White Paper on Defense – in shop contrast with the traditional German reticence on the issue.
  • Charles Michel, who will replace Donald Tusk as president of the European Council in December, is a convinced European, as are the vast majority of his compatriots. As Belgian prime minister for the past five years, he led a coalition including a Flemish nationalist party, the N-VA, but this did not prevent him from promoting further European integration. This made him one of the closest allies in the Council of French President Emmanuel Macron.
  • Christine Lagarde, appointed as successor to Mario Draghi as president of the European Central Bank, played an important role in EU policy during the financial crisis of 2008. As the French Finance Minister, she presided over the Ecofin Council during the French presidency, at the peak of the crisis. She is credited, together with president Sarkozy, with keeping the EU united and even able to influence the global reaction to the crisis. As IMF president during the past eight years, among her many achievements she can count contributing to the preservation of the Eurozone by having the fund participate in the rescue of Greece.
  • Josep Borrell, the Spanish Foreign Minister and the nominee for the post of High Representative, entered politics as a close ally of Spanish socialist leader Felipe Gonzales, who brought Spain into the European Union during the Eighties. He was President of the European Parliament from 2004 to 2007. Being himself Catalan, he is a strong opponent to the secession of Catalonia from Spain.
  • The leaders also suggested giving senior positions in the new Commission to Frans Timmermans and Margarethe Vestager, who were among the most prominent operators in the Juncker Commission and had been nominated by their party groups as “Spitzenkandidaten”, or lead candidates, for the Commission Presidency.

Ostracization of the Hard Right

Three of the departing leaders were Italian, and Italy is well known for fighting hard for international leadership positions. Interestingly, however, the new Italian eurosceptic coalition got nothing from the European Council. An Italian, David Sassoli, was elected President of the European Parliamentbut he is a member of Matteo Renzi’s Partito Democratico, which is currently in opposition. His appointment therefore does nothing but spite the current populist coalition of the League and Five Star parties.

One of the main losers was Manfred Weber, the German MEP from the center-right European People’s Party (EPP). The Parliament’s leadership had wanted to impose his candidacy for Commission President on the Council, in line with the so-called “Spitzenkandidaten” procedure.  Mobilized by Macron and the whole Council machinery, the European Council set him aside. This was intended to make clear that they want to keep the initiative in selecting the Commission’s  leadership – but was also enabled by Weber’s weak candidacy, and his sometimes very right-wing positions, aligning himself more closely with the Polish and Hungarian ruling parties’ views than those of his more mainstream colleagues in the EPP.

Central and Eastern European countries received no leadership positions, but seemed to content themselves with a defensive role – blocking Frans Timmermans from the Commission Presidency for having led EU investigations into breaches of the rule of law in Poland and Hungary. Perhaps this was to be expected, in a Union wanting to reaffirm itself as a cohesive actor on the world scene, rather than promoting national differences or questioning the fundamental values in which the block has been rooted.

The votes on chairmanships of committees in the European Parliament confirmed the determination of the majority to exclude extreme right and antiestablishment parties, even if these gained strength in the May election.

Indeed, the new “Identity and Democracy” (“ID”) group, which includes Matteo Salvini’s League and Marine Le Pen’s National Rally, is now the fifth-largest group, with 73 MEP, just one less than the Greens. But the four major pro-European forces – the center-right EPP, center-left S&D, centrist liberal Renew Europe and the Greens – together control 518 of the 751 seats in Parliament, which allows them to control fully its activities.

Indeed, they have already used this strength to deny other groups the leadership positions they could expect under the traditional apportionment of Committee Chairs and other senior positions. This has extended even to the European Conservatives and Reformists (“ECR”), which has 62 members and includes the UK Conservative and Polish Law and Justice parties, by blocking former Polish Prime Minister Beata Szydło from becoming chairwoman of the Employment and Social Affairs Committee. It may not have helped that group’s cause that they recently admitted far-right, anti-immigrant parties from Spain (Vox), Italy (Brothers of Italy), and the Netherlands (Thierry Baudet’s Forum for Democracy).

The Difficult Election of Ursula von der Leyen 

The election of Ursula von der Leyen by the European Parliament was not easy: she won 383 votes in favor, only 9 more than the 374 needed to obtain a majority.

Her appointment by the Council had already been opposed for internal reasons by the German Social Democrats, who forced Angela Merkel to abstain in the Council vote. They continued to act against her in the Parliament, rallying part of the Socialist group (S&D) to their opposition, voicing their disappointment at the rejection of the socialist Spitzenkandidat Frans Timmermans.

Ursula von der Leyen did not get the support of the Greens, who ostensibly announced from the outset that they would not vote for her. This was more posturing than substance, since the new President had announced a rather ambitious program to fight global warming.

The vote being secret, other MEP from the majority parties did not vote for her, perhaps to express their disappointment at seeing the Spitzenkandidaten procedure being abandoned. However, von der Leyen received some support from the Conservative group (ECR) and the Italian Five Star Movement, whom she had not courted, but who perhaps wanted to signal their desire to be seen as ”mainstream” parties.

No election of a Commission president has ever been smooth. What is most important in practical terms is that the vote succeeded – a loss by von der Leyen would have created a rather chaotic situation. Her confirmation will see a woman lead the European Commission for the first time – and enable her to prepare as from now for the difficult challenges the new Commission will have to face in the Fall.

What Happens Now?

The only leader who was fully elected on July 2 is the President of the European Council, Charles Michel. He will start his term on December 1.

The president of the ECB should be formally confirmed mid-September by the European Council, on the basis of a Council recommendation, after consulting the European Parliament and the ECB’s Governing Council. If there are no issues, Christine Lagarde should be in post, in Frankfurt, on November 1.. She has already resigned from her position as head of the IMF in order to allow the fund to start selecting her successor.

The High Representative, Josep Borrell, will be included in the new Commission as the Spanish representative, and take his post on November 1, if, as the other members of the Commission, he passes successfully a hearing in the European Parliament.

After having elected Ursula von der Leyen and decided on its internal functioning, the European Parliament will now go into recess – and respect the traditional long summer break in Brussels. Its next plenary session will be in mid-September in Strasburg.

The new President of the Commission, however, will not have much time for a summer holiday. Ursula Von der Leyen will, as Juncker did 5 years ago, spend the whole summer selecting the members of the Commission, which is always a difficult exercise.

 The Composition of the European Commission   

The problem in composing a European Commission is not the lack of talent. Strong personalities and high-level national leaders are eager to join the team. The problem is that the old rule, according to which each Member State has the right to a Commissioner, is still in place – but there are not 28 real functions to be distributed.

A reduction of one third of the number of Commissioners was mandated by the Lisbon treaty, but when Ireland rejected the treaty by referendum in 2008, the European Council, to accommodate the Irish, pledged not to implement this treaty provision – and there is no sign that it will do it any time soon.

So, each Member State will present a candidate, as before. Some have already done so.

  • For Spain, it will be Borrell, the High Representative, who is “double hatted” in the Commission and in the Council.
  • As agreed in the European Council, the Netherlands will present Frans Timmermans and Denmark Margarethe Vestager, who should have prominent posts as Vice Presidents.
  • A few other commissioners are staying: Valdis Dombrovskis (Latvia), Mariya Gabriel (Bulgaria), Phil Hogan (Ireland), Maroš Šefčovič (Slovakia), and Johannes Hahn (Austria).
  • As new commissioners, Luxemburg has already proposed Nicolas Schmit, Estonia Kadri Simson, Hungary László Trócsányi and Finland Jota Urpilainen.
  • Italy will probably propose Giancarlo Giorgetti, who – though a vice president of Salvini’s party, the League – seems to be appreciated in Brussels.

The list of the candidates has to be accepted jointly by the Council and the President elect (article 17 para. 7 TEU) but the President elect alone decides (according to article 248 TFEU) how to structure the Commission and which responsibility to give to each Commissioner.

After the Commission is composed, each Commissioner, before being confirmed, has to submit him- or herself to a hearing in the European Parliament (which is careful, almost at every occasion, to reject one of those proposed).

Over the summer, Ursula Von der Leyen will therefore select the candidates, in dialogue with the Member States, but she needs first to define how the responsibilities will be shared. She might take over the “two-tier” structure put in place by Jean Claude Juncker, with teams of ostensibly (but not technically) more junior Commissioners led by a Vice President,  or could establish a new structure.

Interaction with Covington’s Public Policy team

The Commission will, if everything goes as planned, start functioning on November 1 – which, on the current timeline, would  be the first day after Brexit. The institutions will also be confronted with the urgency to decide on the new multiannual financial framework – The EU’s long-term budget – for the period 2021-2027. There is also pressure on the Commission to come forward with new regulatory initiatives for the tech sector. In addition, the trade challenges of the last years will continue to disrupt the relations with major partners in the world.

Our Public Policy team is well placed to help clients deal with the change of guard and the challenges the new leaders will face as soon as they are in place. All of the new EU leadership have experience in EU institutions and are thus familiar to partners and senior advisors in our Brussels office. This will also be true of the new Commission more broadly, if one goes by the list of prospective members – and of the leadership of the European Parliament, in which one sees many familiar faces.

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Photo of Jean De Ruyt Jean De Ruyt

Ambassador Jean De Ruyt is a senior public policy advisor in Covington’s EU public policy team.  Ambassador De Ruyt, a non-lawyer, is among the most experienced diplomats in Europe.  Most recently, he served as the Permanent Representative of Belgium to the European Union…

Ambassador Jean De Ruyt is a senior public policy advisor in Covington’s EU public policy team.  Ambassador De Ruyt, a non-lawyer, is among the most experienced diplomats in Europe.  Most recently, he served as the Permanent Representative of Belgium to the European Union and was chair of the Committee of Permanent Representatives during the 2010 Belgian Presidency of the Council.

Ambassador De Ruyt works with Covington’s transatlantic government affairs team, which includes experienced lawyers as well as former senior policymakers.  The team advises clients on a range of European public affairs issues, including the EU policy-making processes, functioning of the European institutions, development of EU legislation and accession of new EU members.  Ambassador De Ruyt has particular expertise in the workings of the EU Council and EU institutions more broadly, transatlantic relations and United Nations development policy.

Ambassador De Ruyt was closely involved in Europe’s response to the financial crisis and the resulting legislation at the European level.  He was instrumental in the creation of the European diplomatic service and, as the Permanent Representative, facilitated the resolution of a variety of state aid and competition policy disputes for Belgian companies.

Ambassador De Ruyt was involved in the negotiation of the European Single Act and the Nice and Lisbon Treaties, in initiatives relating to the implementation of the Oslo agreements in the Middle East and in the rebuilding of peace in Central Africa.  He also participated in the stabilisation of former Yugoslavia and the development of NATO and European Defence.

Photo of Atli Stannard Atli Stannard

Atli Stannard is special counsel in the firm’s Public Policy practice. He guides clients in highly regulated industries through complex EU policymaking processes, protecting and advancing their core business and regulatory priorities.

Atli’s practice covers all aspects of EU policymaking and legislative advocacy…

Atli Stannard is special counsel in the firm’s Public Policy practice. He guides clients in highly regulated industries through complex EU policymaking processes, protecting and advancing their core business and regulatory priorities.

Atli’s practice covers all aspects of EU policymaking and legislative advocacy, including the regulation of the tech, food and beverage, pharmaceutical and medical devices, and industrial sectors, and on EU trade, environmental and ESG, and competition policy. He has handled matters before the European Commission, European Parliament, Council of the EU, and Member State and UK governments. Clients rely on him to identify regulatory risks and opportunities, and engage in the policy process to defend and promote their business interests.

  • Technology: Atli has worked extensively for clients on matters relating to EU data, content, platform, Artificial Intelligence, and competition policy.
  • Food and beverage: Atli helps clients developing novel plant-based foods to secure the necessary regulatory authorizations and engage in broader EU food policymaking. He regularly engages with EU and national authorities to ensure that health and environmental regulations are based in rigorous scientific evidence. He has drawn on his trade policy expertise to assist clients seeking to import food products into the EU.
  • Drug & medical devices: Atli has counseled clients and engaged with the EU institutions on matters relating to genomics, the regulation of medical devices and in vitro diagnostics, health technology assessment, orphan medicines, and pricing.
  • Industrial: Atli helps clients engage with EU and national bodies on the environmental benefits of their innovative technologies, and on EU plastics, chemical, and product regulation.

In his EU trade policy work, Atli regularly advises clients facing on EU market access and customs classification issues, trade defense actions (tariffs and safeguard measures), and non-tariff barriers (including sanitary and phytosanitary measures). He helps clients engage in the EU’s negotiation of new trade agreements. He counsels clients on the impact of the upcoming Carbon Border Adjustment Mechanism, and how to shape and comply with its requirements.

Atli is a member of the firm’s ESG and Business and Human Rights Practices, and works with clients to assess the impact of and engage with new and upcoming Environmental, Social and Governance rules, including the EU Green Deal, supply chain diligence and the EU’s developing sustainable finance rules.

Atli’s competition policy advocacy work encompasses mergers, challenges under Articles 101 (anticompetitive agreements) and 102 (abuse of dominance) TFEU, and referrals under Article 22 of the EU Merger Regulation.

Atli has counseled international investors extensively on the EU’s proposals for a regime on foreign subsidies, and on the EU’s new FDI screening rules and coordination mechanism, as well as on EU tax policymaking. He also works closely with litigation colleagues to protect clients’ legitimate interests in multiple venues.