BR SPECIAL. Opinion split on Austrian-style lobbying law in Romania

Newsroom 04/04/2019 | 15:32

Romania is close to adopting a lobbying regulation based on the Austrian model, with a draft bill already approved by the Senate. But many commentators think that the line between lobbying and influence peddling must first be clarified.

By Sorin Melenciuc & Ioana Erdei

In September 2018, two different draft bills with almost the same content were published: a draft government emergency decree drawn up by the Ministry of Business Environment, Commerce and Entrepreneurship and a draft bill put forward by ALDE, the junior ruling party.

The two projects evolved differently: the draft emergency decree is still going through the inter-ministerial approval procedure, while the ALDE draft bill was approved by the Romanian Senate on March 11.

But the origin of the both projects is the same, according to Radu Oprea, the Romanian minister of the Business Environment, Commerce and Entrepreneurship.

“The draft project was published on the ministry website and was up for public debate for a long time. The business community confirmed the need for legislation on lobbying. Then we entered the internal and inter-institutional approval process – unfortunately things take a long time to go through this process in Romania, so some of our colleagues in Parliament said that a quicker way to do it was through a parliamentary initiative; therefore the lobbying law, which is fundamentally identical except for a few words here and there, has already passed the Senate and is up for debate in the Deputies’ Chamber,” Oprea told Business review.

In the form approved by the Senate, the draft bill says that lobby firms can be set up in Romania and undertake lobbying activities only after being entered in a special registry managed by the Chamber of Commerce and Industry of Romania.

Lobbying models: US versus Europe

In the US and in Europe, lobbying firms are generally specialist companies that primarily represent clients before politicians and government regulators.

While there are no clear boundaries between what is lobbying and what is PR, lobbying firms often play specific roles within a broader campaign plan.

The Romanian minister of the Business Environment argues that Romania needs to regulate lobbying activities – but using a clear European model.

“The American approach is the harder, tougher one, and it follows the money. You state your interests, your contracts, the amounts you make, everything is transparent and there’s a lot of talk, including in the US, about the need and the power of lobbying today. But we’re not going to discuss that here,” said Oprea.

In Europe, a voluntary statement of interests is preferred, Romanian officials say.

“For example, there’s a transparency registry in Brussels where everyone voluntarily registers their interests and who they’re meeting with. This has worked in Romania as well, and I continue to provide information about all my meetings because I believe that’s the honest and transparent approach. The first rule of transparency is to have rules that are clear to everybody – and once you know the rules of the game, everything happens in a transparent manner,” the minister outlines.

But in Romania, talks between government officials and representatives of the business community – which have taken place in the Economy and Industry Committee of the Senate, as well as at the Ministry – show that there is a desire for a lobbying regulation.

“Therefore, we have chosen the Austrian version as it’s the lobby law that works best in Europe right now and it’s the closest to what the Romanian business community wants. Austria held the EU presidency before us, which is why I can’t see why anyone would oppose the idea of having a lobby law that’s similar to the Austrian one, and as a result of this intense research we’ve conducted, we took it out of the official gazette in Austria and adapted the law to Romanian institutions in the spirit and the letter of the Austrian law,” added Oprea.

Disputed provisions

However, representatives of the business community have issues with parts of the draft bill: the Coalition for the Development of Romania, representing major local businesses, has criticized some aspects.

The first contested provisions are on the management of the special lobbying registry and the lack of a clear mechanism to investigate and settle complaints involving lobbying activities.

“The sanction mechanism proposed by the draft decree may easily give rise to abuses as it looks at enrollment errors, with information that is open to interpretation,” the Coalition said last October, in response to the proposed draft government emergency decree.

“We also propose the elimination of fines, as a long period will be needed for organizations to understand and adapt to registration conditions, and for the authorities to understand what they need to monitor,” the Coalition added.

Both the draft bill approved by the Senate and the emergency decree propose fines between RON 50,000 (EUR 10,500) and RON 300,000 (EUR 63,000) for various violations of the law.

There has also been criticism of the terminology used in the proposed draft bills.

“The project distinguishes between lobbying and representation of interests, although the two terms are synonymous. We think that the terminology should be unified and only one of the terms used, preferably ‘representation of interests’, which is also used in European institutions,” the Coalition commented.

Rebalancing the relationship between state and businesses

The law is part of the current governance program and the minister of the Business Environment points out that the Romanian government wants to rebalance the relationship between the state and entrepreneurs.

“The best example of this is the Prevention Law, which introduces a fundamental change in the general mentality and the Romanian state’s approach through its representatives who go to inspect businesses. The idea that they should first guide entrepreneurs towards compliance and only apply sanctions if they find malevolence is a fundamental idea that changes this relationship,” Oprea told BR.

Lobbying and influence peddling

Could a lobbying law also clarify the difference between legitimate discussions over the introduction of laws that affect industries and influence peddling?

Such meetings have always been considered influence peddling in Romania, and experts say that the two activities must be viewed in a separate manner.

“There is a view in the Justice Ministry that the line between lobbying and influence peddling is too unclear. I believe that this is an argument in favor of a lobbying law, so that this thin line is no longer an issue. This line, which is not at all clear, between the two, means that people can be subjective on the matter. Clear regulation is exactly what we need to be able to make the difference,” argued Oprea.

Romania has tried to introduce lobbying into its legislation several times, but always got stuck in intense discussions and no progress was made. But many in the current government think that clearly defining these concepts can only have positive results.

“Today, a lobbyist doesn’t really know what they can and cannot do. Some of the lobbyists in Romania today don’t even call themselves lobbyists,” notes the minister.

“In my opinion, the law that was passed by the Senate, through its definitions, clearly differentiates between lobbying and influence peddling. I can’t say whether it leaves room for interpretation as I’m not a legal expert, but given that such a law has worked in another EU member state, it can also work well in Romania. Our research on all EU member states has shown that the Austrian version is the best for our country,” he added.

Some members of the opposition are also supporting the idea of a lobbying regulation.

“A lobbying law has become necessary today for the simple reason that lobbying is already going on in Romania without any regulation and without standards. I know three Romanian companies with foreign shareholders who are lobbying and say in the market that they are doing it. Regulating lobbying is also necessary we live in a very complex and divers world where social interests need to be reflected in legislation. This way legislation becomes more complex. There are tens of thousands of EU regulations that need to be implemented in our national laws, damaging in a way, the quality of legislation.  Also, the law must respond to the needs of all citizens and companies, not only the ones of public institutions. A lobbying industry may help to clarify these issues” Catalin Predoiu, an opposition (liberal) member of the Chamber of Deputies, told BR.

Other opposition MEPs oppose the project, arguing that it is just a masked decriminalization of influence peddling.

HOW DO EU MEMBER STATES REGULATE LOBBYING?

Regulating lobbying in Romania has been debated for the past few years. The Ministry of the Business Environment produced a draft law, but it got stuck in technical legal matters and never reached adoption. The same draft document was submitted in Parliament, with the senator Varujan Vosganian as the initiator. In March, the Senate adopted the draft law and it was sent to the Chamber of Deputies, which has the final decision.

Romania’s draft lobbying law is mainly copied from the law currently in force in Austria. In the European Union, around eight member states have lobbying laws in place: Austria, Ireland, Lithuania, Latvia, Poland, the UK, Slovenia, and Hungary. Other member states have widely accepted customs and practices related to lobbying: Belgium, Denmark, Finland, France, Germany, and the Netherlands. In Bulgaria, the Czech Republic, Portugal, Spain, Sweden, Greece, Cyprus, Italy and Croatia, lobbying is not regulated.

AUSTRIA

Austria’s Federal Law for the Transparency of Lobbying Activities and Representation of Political and Economic Interests was passed in July 2012 and came into force on January 1, 2013. The law establishes clear conduct and transparency rules for lobbying in parliamentary or administrative decision-making processes. It establishes minimum contractual standards and conduct requirements for lobbying.

Lobbying companies, businesses that hire lobbyists to represent their interests, individual lobbyists and associations that carry out activities to represent political and economic interests must register in the Austrian Federal Justice Ministry’s official lobby and transparency registry – a public database. Those involved in lobbying must follow a code of conduct and publish this code on their own websites. Violating the conduct code results in financial penalties of up to EUR 60,000 and can lead to the elimination of the entity from the lobby registry, following a decision by the Justice minister. Those eliminated from the registry can only be reinstated after a three-year suspension.

The law applies to a wide range of actors in the field of public policy influence. Commentators say the reporting requirements for registered entities are not burdensome and don’t hinder lobbying activities. However, registration is difficult for companies not headquartered in Austria, with the exception of associations that don’t hire lobbyists, but carry out lobbying activities.

IRELAND

Lobbying in Ireland is carried out under the Regulation of Lobbying Act of 2015. The Department of Public Expenditure and Reform (DPER) is the institution that oversees the regulation’s implementation and the public consultation process and receives proposals for amendments to the law.

Ireland’s lobbying law aims to inform the public about: who carries out lobbying activities and on behalf of whom; the issues involved in lobbying; the purpose of the lobbying; who is targeted.

The law led to the introduction of a registry of individuals conducting lobbying activities, a code of conduct, a set of restrictions for some public officials, and new ethical rules for public offices and the provision of information. The registry is public and can be viewed online. The Public Office Standards Commission oversees the implementation of the registry, monitors compliance, offers guidance and assistance and, if needed, investigates violations of the legal requirements. The Commission is an independent body and has six members. The lobbying law also imposes restrictions and conditions on individuals in order to avoid conflicts of interest.

LITHUANIA

The country’s lobbying law came into force in 2001 and requires all lobbyists to enroll in a public registry and submit annual reports that include revenues and spending related to lobbying, as well as their interests in relation to legislative proposals. Lobbying is defined as action carried out with the purpose of influencing change or repeals in existing legislation or the adoption or rejection of new legislation.

The law does not apply to foundations or associations. The institutional ethics commission oversees compliance with institutional ethics standards, regulates public and private interests in public office and controls certain lobbying activities.

POLAND

Poland’s law on lobbying in the legislative process was passed in 2005 and focuses on implementation and transparency rules, professional norms, professional control of lobbying and the principles of maintaining a registry of entities involved in such activities as well as their type of activity and the issues they deal with. Lobbying is defined as any action carried out through legal means to influence public authorities in the legislative process. Failure to register as a lobbying entity results in fines of between EUR 750 and 12,500. The Internal Affairs Ministry maintains the database and ensures its security. The law only applies to professional lobbyists and excludes all other categories of individuals or legal entities. There has been extensive debate on how the law should be improved, amid complaints that it imposes excessive reporting requirements on public authorities, which has made them wary of establishing contacts with registered lobbyists.

UNITED KINGDOM

The UK passed the Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Act in 2014. In March 2015, the government launched a registry for lobbying consultants, which requires all individuals involved to register in order to be allowed to carry out such activities.

Formal procedures enable individual members of the public to lobby their Member of Parliament but most lobbying activity centers on corporate, charity and trade association lobbying, where organizations seek to amend government policy through advocacy.

SLOVENIA

Lobbying activity is included in the Integrity and Prevention of Corruption Act of 2010. Lobbying is defined as activities carried out by representatives of interest groups who, on behalf of these groups, exercise non-public influence on decisions made by state authorities and the local community, and on the public authority in the discussion and adoption of legislative acts and other general documents, as well as on decisions made by state authorities or local bodies and administrations on other matters than those subject to judiciary and administrative procedures or other procedures carried out according to public acquisition regulations, when the rights and obligations of individuals are decided. Lobbying is defined as any non-public contact between a lobbyist and an individual targeted by lobbying with the purpose of influencing the content or adoption procedure of the decisions noted above.

Lobbyists must register in a public database under the supervision of the Anti-Corruption Commission. Some say that the regulation is insufficiently implemented. The Commission has complained about its limited resources having a negative impact on the systematic and rigorous supervision of lobbying.

HUNGARY

Lobbying was regulated in 2006 through a law that was repealed in 2011 and replaced with a new one. The general consensus is that the law has several problems.

Close ×

We use cookies for keeping our website reliable and secure, personalising content and ads, providing social media features and to analyse how our website is used.

Accept & continue