The Malta Independent 22 August 2019, Thursday

They’re coming

Noel Grima Sunday, 21 July 2019, 08:42 Last update: about 30 days ago

The main story of The Malta Business Weekly this week announced that on Wednesday the European Commission had decided on a series of measures to further strengthen the rule of law in Europe.

The Commission was building on lessons learnt since 2014 and detailed consultations that have been carried out since April this year.

Over the past five years, the Commission said, it had to deal with a series of challenges to the rule of law in the EU. The European project relies on constant respect for the rule of law. This is a prerequisite for citizens to enjoy their rights under EU law and for mutual trust among Member States.

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At this point, the Commission is not mentioning countries, although the media in Europe pointed out at Poland and Hungary. Malta was not mentioned in the media I read, but of course here in Malta we have a huge rule of law issue.

A Eurobarometer public opinion survey was also published and it showed that around 80% of citizens of Europe attach great importance to respect of rule of law and feel it must be improved. 89% of citizens insist that the rule of law must be respected in the other Member States.

As regards Malta, the survey found that around 70% of Maltese citizens believe that the rule of law in Malta is respected and followed.

First Vice-President Frans Timmermans referred to a recent declaration by the European Court of Justice which reaffirmed that the rule of law is essential for the functioning of the EU. The Commission, he announced, has now decided to strengthen its toolbox to promote, protect and enforce the rule of law.

The Commission is thus setting out concrete initiatives grouped around three pillars – promoting a rule of law culture, preventing rule of law problems and responding effectively to rule of law breaches.

To promote a common rule of law culture, there will be an annual rule of law event for dialogue with civil society. There will be funding possibilities to empower stakeholders and a dedicated communication strategy on the rule of law.

To prevent rule of law problems from emerging, there will be a Rule of Law Review Cycle including an annual Rule of Law Review Cycle including an annual Rule of Law Report covering all EU Member States. Hopefully, this will bring about early detection of Rule of Law problems. The Commission will also further develop the EU Justice Scoreboard.

Thirdly, for an effective common response to Rule of Law breaches, the Commission will continue to make full use of its enforcement powers and adopt a strategic approach to infringement procedures and even bring cases to the Court of Justice of the EU.

There may be those who react with some scepticism to all these proposals and who point at repeated breaches as evidence the Commission barks but does not bite. But this may be a misconception. The EU, it’s true, sometimes (many times) takes a long time to get anywhere but sometimes it does get there at the end.

It is true the EU is well down the line in its confrontation with far bigger countries like Poland and Hungary on Rule of Law issues. But it’s also true Malta is small enough to be made an example of what happens to those who flout Rule of Law issues.

There is a corresponding issue – the EU is getting nearer and nearer to introduce a common tax, small and ineffective at first but getting stronger and stronger over the years. Our two parties have been steadfast that taxation is a sovereign matter and that Malta will resist any common taxation for Malta would thus lose its taxation advantage.

But read what Philip von Brockdorff, a professor at the university, had to say: “G7 nations Finance Ministers and Central Bank Governors appear to have reached some compromise to come up with a plan to work out a minimum corporate tax regime across the world to avert large companies diverting their profits to tax havens or low-tax jurisdictions. The G7 includes Germany, France and Italy, EU Member States and euro area members. Evidently, it's only a matter of time before a minimum corporate tax rate is applied in the EU with the European Commission already proposing a stepped approach which includes a gradual phasing in of a consolidated corporate tax. Sooner or later low corporate tax jurisdictions like Malta will need to come to terms with what seems like the inevitable. It is time to start exploring allowable alternative arrangements aimed at attracting FDI.”

As a nation we have been dozing in the summer heat or mesmerized by the goings-on at the PN stamperija which reach their denouement this coming week. Many of us have not realized that by the end of this week the UK will have Boris Johnson as its prime minister.

Nor have we understood the import of the recent choice of the leaders of the European institutions except for the fact that Joseph Muscat was not proposed for any high post. (Although, knowing what Macron was doing very clearly excludes Muscat being on any Macron list of possibles).

The EU is moving on and, having escaped being taken over by the anti-EU fringe, is setting out to build a stronger, more cohesive, EU. Once we have unfortunately made our niche in the seamier side of a lax EU, we are now right in the cross-hairs of those who want to make EU stronger.

Unfortunately, this may mean a terrible scrutiny of whoever is sent as Malta’s next EU Commissioner, especially if that person is Edward Scicluna.

 

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