i Re Europe Lobbying

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Lobbying regulation in theEU: A comparison with theUSA &Canada

PAUL FLANNERY

Interest groups are perceived in a different light in every political sys-tem, and are thereore treated differently in every political system ac-cording to its experience with interest representation and its objectives.In essence, interest representation is a legitimate and integral part odemocracy, effectively qualiying lobbyists as credible political actors.

An interest group pursuing their goals in the political arena by lobbying, orattempting to influence policy-making, is ostensibly consistent with the spir-it o democracy. Beyond a rich, open democratic dialogue between interestrepresentatives and political institutions, interest groups are well-known orproviding inormation and technical expertise to ensure enlightened policyormulation.

While theoretically consistent with the principles o democracy, in prac-tice, interest group influence can sometimes lead to political corruption, theinequality o representation, and the overcrowding o political institutions.As a result, some political systems find it prudent to regulate interest repre-sentation. Such regulations are to be considered not simply as written or un-


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written standards and practices, but legal statutes passed by the governmentthat must be ollowed by interest groups when influencing government, withpenalization or non-compliance. Tey seek to ensure accountability and

transparency to the policy-making processes and legitimizing its practiceby structuring and regulating the relationship o political actors and interestgroups.

In examining the EUs lobbying regulations, it is useul to consider themwithin a comparative ramework. A comparison enables us to explore wheth-er the efforts o the EU to regulate lobbying are, in act, comparatively weak,and to discern whether or not it would be prudent or the EU institutions tocreate more robust regulatory statutes in light o the inormation providedby the comparison. o do so, both a comparative qualitative and quantita-

tive analysis will be done concerning each aorementioned political system.Qualitative analysis will consider the measures promulgated in legislation,while quantitative analysis will be based on Center or Public Integrity (CPI)scores to measure the strength o lobbying regulations in each system. (SeeNOE at end of text)

Te complex multi-level system o policy-making in the European Un-ion yields an equally complex system o interest representation. An actorattempting to influence policy in the complex system o the EU must dealwith sub-national, member state, and the multiple supranational institutions.(Greenwood, , p. ) Complicating the system urther is the rapid growthin the number o interest groups in the EU over the past ten to fifeen years.Tis trend in increasing interest group representation also seems set to con-tinue, though perhaps at a slower rate, in the uture. (Lehmann and Bosche,, p. ) It is or these reasons that difficulties arise when considering,prioritising, and structuring the plurality o interests in the EU. Despite thecomplexities and growth o lobbying in the EU, which undoubtedly createpotential or complications, the EU has responded with a laissez faire ap-proach to the regulation o lobbying.

When judging lobbying regulation, it is sensible to consider the nature ointerest representation relative to the objectives o the system in interactingwith interest groups. Indeed, the EUs approach to regulation may appearweak in comparison to countries with a richer history o lobbying, but thepresent rules and practices are perhaps consistent with the present objectiveso the EU. (Chari et al., , p. ) We may find, however, that these objec-


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tives change in the uture, requiring a reconsideration o regulation policy.Te institutional actors o the EU responsible or the ormulation and im-

plementation o policy include the Council o Ministers, the European Com-

mission, and the European Parliament. Each institution is responsible or adifferent unction in policy ormulation and implementation, and is there-ore pursued by lobbyists in different ways and at different stages o policyormulation. Naturally, then, each institution has a unique relationship withlobbyists.

Te Council is meant to represent the interest o the member states andhas the ability to reject or amend proposals that are put orth rom the Com-mission and to determine the long-term goals o the EU. (Chari and Kritz-inger, , p. ) It is ofen considered to be the least accessible o EU in-

stitutions because o its allegiance to the member states. It keeps no list olobbyists and holds the position, according to an inormal reply rom theCouncil Secretariat in , that all contact with lobbyists and NGOs is han-dled by the European Commission. (Lehmann and Bosche, , p. ) Ia lobbyist is to attempt to persuade the Council, it will be through nationalchannels; thereore, it has no need or EU-level regulation.

Te Commission is responsible or EU interests. It has the exclusive rightto initiate EU legislation in a number o policy areas and is responsible orensuring that members comply with such. (Chari and Kritzinger, , p.) As a result, lobbyists view the Commission as the primary institutionwhere interest representation begins. (Lehmann and Bosche, , p. ) TeCommission openly welcomes outside input, holding that the process o lob-bying is undamental to policy ormulation, and placing a high value on anopen dialogue with outside interests that offer specialised and technical ex-pertise. (Greenwood, , p. ) It is now recognized that the Commissionofen concentrates on an inner core,o dominant interest, resulting in lob-byists directly targeting this inner core. (Malone, p. ) Te existence o thissecondary lobbying tactic is evidence that there exists an inequality o accessto the Commission, a result, in part, o an unstructured relationship betweeninstitution and interest representation.

Te representative body o the European Parliament (EP) has the powerto approve, amend or reject legislation in a number o policy areas, and in-fluence the appointment o commissioners. In terms o lobbying, the Parlia-ment has become a desired target or lobbyists since members o the Parlia-ment became directly elected in . (Malone, p. ) Te Parliament is seenby some as the most open o all European institutions and is considered anatural target or...non-business interests. (Greenwood, , p. ) Howev-


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er, some scholars have argued that direct lobbying o the Parliament in effectamounts to indirect lobbying o the European Commission, where it is per-ceived that the real opportunity to influence policy-making lies. (Lehmann

and Bosche, , p. )

An extensive network o interest groups is involved in policy-making inthe EU. It is estimated that there are , interest groups and , individ-ual lobbyists based in Brussels. (ALER-EU, ) Te stakes or special in-terests include influence over regulation, promotion, integration, and und-ing. (Greenwood, , p. ) EU institutions are subject to outside influence

and it stands to reason, then, that they are equally susceptible to the harmulconsequences o unethical and unstructured lobbying. Te EU is no strangerto concerns regarding equality o access to institutions, and lobbying abuse.It has experienced scandal, overcrowding, and aggressive styles o lobbying.(Lehmann and Bosche, , p. ) It thereore seems ironic that the targetinstitutions o outside interests are, at best, eebly regulated.

Te European Parliament is the only institution with ormalised lobbyingregulations. Due to concerns o lobbying abuse in the s and s, theParliament began investigating lobbying across the EU institutions. Tese in-vestigations prompted the Galle, Ford, and Nordmann reports, which calledor minimalist standards o regulation ensured through a code o conduct,or both outsiders and members o the EP, and a registry. Its regulations man-date registration o lobbyists, although lobbyists are required to provide com-paratively less inormation than in the US and Canada. Inormation that lob-byists must provide only includes limited details surrounding their lobbyingactivities. Further, lobbyists must abide by a code o conduct. Quantitatively,the low-regulated EP has been scored CPI, a ailing score on the CPI Index.

As the initiator o legislation, the Commission seeks specialised inorma-tion rom reputable interest groups, and has a reputation or being the mostaccessible o all institutions or lobbyists. (Malone, p. ) In response, howev-er, to the pressure or transparency prompted by the Ford report issued by theParliament in the early s, it began, and continues, to encourage a policyo sel-regulation o interest groups, in order to orestall regulation and pro-mote an open, structured dialogue as well as ethical behaviour. (Greenwood,, p. ) Despite having a reputation or being the most accessible insti-tution, the Commission stands by its encouragement o sel-regulation andonly offers a voluntary lobby register, rather than ormalising regulation. Sta-


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tistics published by ALER-EU suggest that the voluntary register has ailedto ensure transparency: Only out o the estimated Brussels-basedlobby organisations have registered (.). (Olivier, )

With such lax regulation governing interest representation to the Parlia-ment, and no ormalised regulation applied to the Commission, it is clearthat interest group regulation across the institutions o the EU is markedlyweak. Contrasting this practice with those ound in the United States andCanada provides an interesting perspective on possible alternative strategiesand approaches to lobbying and regulation which the EU might consider asits needs and objectives change over time.

Te United States government has the longest history o, and arguably themost experience with, lobbying regulation o all governing bodies consideredin this essay, and even has a claim to the origins o the term. (Hansen, )As a result, the US exists as an ideal base level example rom which a com-parative evaluation can be made. It has experienced the corruption associ-ated with lobbying, its overpopulation o governmental institutions, and in-equality o interest representation and consideration. Modern scholars o USpolitics and lobbying recognize not only a pluralism o represented interestsin the US, but a hyperpluralism. Some scholars argue that this has renderedthe US institutions ineffective policy makers. In his book, Governments End,Rauch calls the result o this phenomenon demosclerosis, a literal clogging othe democratic institutions as i they were arteries. (Rauch, ) Te US hasbeen continuously challenged to strike a balance between the First Amend-ment rights o the billion-dollar lobbying industry and providing its insti-tutions with a structured relationship with accountability and transparency.(Te Center or Public Integrity, )

Starting in the s, the US Congress sought to ensure accountability ininterest representation by legislating regulatory statutes in reaction to scan-dals concerning commercial lobbying. (Chari et al., , p. ) Te legisla-tion was widely considered deficient and required urther legislation. o reg-ulate urther, Te Federal Regulation o Lobbying Act o was enacted,covering anyone,

who by himself, or through an agent, or employee or other persons in anymanner...solicits, collects, or receives money or anything of value to be usedprincipally to aid...the passage or defeat of any legislation by the Congress.


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In addition, the Act required the submission o financial records o lobby-ists. (Malone, p. ) Once more, the Act was rendered inadequate by its ownloopholes and unenorceable conditions. It was not until , however, that

the act was repealed and replaced by the Lobby Disclosure Act, which wasurther amended in . In these measures, regulations were strengthenedby widening the definition o a lobbyist, requiring the registration to both theHouse and Senate o all individual lobbyists, and requiring semi-annual re-ports that list issues o interest, institutions contacted, the lobbyists involved,and the association with any oreign actor. Although the various attempts toregulate interest regulation over time were each in turn criticised or continu-ing to allow loopholes and reinterpretations, the presence o such ormalised,legalised regulation is in stark contrast to the lax and inormal approach o

the EU.Tis regulation, moreover, is evident throughout the various levels oAmerican political society. o date, there is not only ederal legislation, butstate-level legislation in every state other than Pennsylvania. (Chari et al.,, p. ) In many cases, this state-level legislation is considered strongerthan its ederal counterpart. For example, the state o Washington rankedfirst out o the fify states with a CPI score o . Furthermore, over hal o thestates boast a score o over , a passing grade in the CPI scale. US ederalregulations were given a CPI rating o only afer its reorms. In ,afer the introduction o amendments under the Lobbying ransparency andAccountability act o and the Honest Leadership and Open Govern-ment Act o , ederal regulations scored .

Te increased regulation urther restricted the ability o lobbyists to o-er gifs to government officials and provided urther transparency throughmore requent activity reports. Subsequent reorms were recently made un-der the Obama Administration in the Recovery Act by barring gifsrom lobbyists and a revolving door ban or as long as he is president. (Stol-berg, ) Such measures would be anticipated to raise the US ederal CPIscore. Research indicates that the strengthening o lobbying regulations inthe US has had a positive impact on the conduct o public policy, and hascreated a new era o openness and proessionalism in government., but regu-lations have yet to ensure equality between interests. (Malone, p. ) None-theless, despite the act that interest group regulation in the United Statesremains flawed, its greater ormalisation, and the consistent and continu-ous commitment o different administrations over time indicates its relativestrength when contrasted with that ound among EU institutions.


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As does the US, Canada has lobbying regulations in place at both the ed-

eral and provincial levels. Regulations were introduced in in reactionto a consensus calling or legislation which would mandate the publicallyavailable registration o lobbyists as a means to promote transparency andaccountability. (Chari et al., , p. ) In response to this call, Te Lobby-ists Registration Act was introduced, defining lobbying as direct communi-cation with ederal officials or the purpose o influencing the ormulation orimplementation o public policy and mandating registration, which only re-quired a very limited inormation set. (Malone, p. ) Te Act was amended in to require more inormation concerning lobbying activities and a code

o conduct based on principles such as integrity, openness, and proessional-ism. (Malone, p. ) Te act was amended urther in in Bill C- to clariythe definitions o lobbying in order to close loopholes.

Quantitatively, Canada, on the whole, is moderately regulated. Under itsmost recent legislation, Chari, Murphy, and Hogan rate the Canadian Federallegislation with a CPI score o and rate the regulatory statutes o the Prov-inces in a range rom to . Te latter o these scores alls within the ail-ing category o the CPI index, although this categorisation is contentious.While Canada is widely considered comparatively more regulated than manyother systems in the world, some hold its legislation is weak in comparisonto US statutes. (Chari et al., , p. ) Nonetheless, as in the US, lobbyistregulation and the resulting transparency o proessional lobbyist activitiesare seen as a healthy development in governance. (Malone, p. ) When con-trasted with the EU, moreover, it is abundantly clear that even a moderatelyregulated system has several more stringent saeguards in place than thoseound in the European Parliament or the Commission.

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When considered in this comparative ramework, the European Unionsefforts to regulate lobbying do indeed appear weak. Eurogroups, howev-er, are also ofen considered quite weak in terms o their effectual influence.(Grande, , p. ) Understandably, in the present perception o interestgroups, they could airly be characterized as valuable assets to EU policy or-mulation and implementation who pose a relatively minor threat.

We might then conclude that the EUs objective in relation to interestgroups is to allow or the ree flow o specialised inormation, so long as it


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does not harm the integrity o the institution. It is plausible that the EUs cur-rent efforts to regulate lobbying are comparatively weak, but are consistentwith the EUs objectives and goals. Because o the nature o the EU as a politi-

cal institution, it could be argued that it is naturally insulated rom the harmso lobbying that the US or Canada might not be. Firstly, the Commission isnot selected by popular vote, thus, decision-makers do not rely on campaigncontributions in the way that Congressmen and Senators might. Moreover,the EU does not have the same public finances to allocate that a conventionalnation state might have. Instead, its unction is to implement regulation thatincreases the efficiency o the market a process which is acilitated by theflow o specialised inormation.

Tis is not to say that the EU would not benefit rom stronger regulations.

Experience in both the US and Canada suggests that regulations have pro-moted openness and proessionalism in the practice o interest representa-tion. Furthermore, both Canada and the US still allow or a rich democraticdialogue and may limit how one is to go about influencing policy, but haveultimately sought a balanced compromise which reflects the unique politicalcircumstances in each respective state. As a result, we may conclude urtherthat the EU would benefit rom a more proessional and transparent policy-making process and should thereore create more robust legislation to pre-vent lobbying abuse. Tis would in turn serve to promote ethical behaviouras the practice o lobbying inevitably grows and becomes more sophisticated.

NOE:CPI scores (CPI ) range rom -, being a system withthe strongest regulatory legislation. Tese scores are based on a survey con-taining questions addressing eight key areas including the definition olobbyist, individual registration, individual spending disclosure, employerspending disclosure, electronic filing, public access to a registry, enorce-ment o regulation, and revolving door provisions. Quantitative evaluationswere originally based on the U.S. ederal and state level legislation, but authorsChari, Murphy, and Hogan (, pp.-) apply the CPI method to Ca-nadian, German, and EU lobbying regulations, offering comparative insight.


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Bibliography

ALER-EU.. Te Commissions Lobby Register One Year On: Success or

Failure? Alliance or Lobbying ransparency and Ethics Regulation. , (Accessed February ).

TeCenter or Public Integrity. .Hired Guns: A Comprehensive LookatLobbying in the States. , (Accessed December ).

Chari,R.S., G. Murphy, and J. Hogan. . Regulating Lobbyists: A Com-

parative Analysis o the United States, Canada, Germany and the EuropeanUnion. Political Quarterly,., pp. -.

Chari,R.S., and S. Kritzinger. . Understanding E.U. Policy Making. NewYork: Pluto.

Grande, E. . Interest Groups in the European System o Multi-LevelGovernance, Working Paper No. /, echnical University o Munich.

Greenwood, J. . Representing Interests in the European Union. London:Macmillan Ltd.

Hansen,L. . A Lobbyist by Any Other Name? , (Accessed Dececmber ).

Lehmann,W. and L. Bosche. . Lobbying in the European Union: CurrentRules and Practices. European Union: European Parliament, Directorate-General or Research, , (Accessed December ).

Malone,M. Undated. Regulation o Lobbyists in Developed Countries, Cur-rent Rules and Practices. , (Accessed De-cember ).


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Rauch, J. . Governments End: Why Washington Stopped Working. NewYork: Public Affairs.

Stolberg,S. G. . On first day, Obama Quickly Sets a New one, Te NewYork imes, , (Accessed February ).

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i Re Europe Lobbying