Monday

20th Jan 2020

Banks declare massive increase in EU lobbying

  • Are some hikes due to under-reporting? (Photo: Gyver Chang)

Banks and internet giant Google are among firms to declare huge increases in spending on EU lobbying as tougher transparency rules enter into life.

JP Morgan Chase says its lobbying costs in Brussels went up from €50,000 in 2013 to between €1,250,000 and €1,499,999 in 2014 - a 30-fold increase.

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Goldman Sachs' figures rose from €50,000 to between €700,000 and €799,999 in the same period - a 14-fold hike.

UBS climbed from between €200,000 and €250,000 to €1.7 million - a seven-fold increase.

Costs for Barclays, HSBC and Royal Bank of Scotland more than tripled, while costs for Banco Santander, BNP Paribas, Deutsche Bank, Danske Bank, and Raifeissen doubled.

Financial sector trade associations also posted huge hikes, including: the European Fund and Asset Management Association; International Swaps and Derivatives Association; European Private Equity and Venture Capital Association; and the Federation Banquaire Francaise.

The increases were posted in the European Commission’s transparency register in the run-up to Monday’s (27 April) deadline on more stringent reporting requirements.

The register is voluntary, but, from last year, firms which stay out are blocked from meeting with EU commissioners or staff in their cabinets.

At the same time, commissioners and senior staff must, since January, publish details of meetings with interest groups, making it harder for non-registrants to slip under the radar.

Banks weren’t the only companies to post significant hikes.

Internet giant Google says it spent up to €4 million last year compared to €1.5 million in 2013.

Energy firm BP and furniture outlet Ikea doubled spending to €3 million and €900,000, respectively. Sony Europe said spending went from €50,000 to €600,000. Ebay’s figures climbed from €100,000 to €500,000.

Compliance remains patchy, however.

The commission said all firms which miss Monday’s deadline will be struck off the register.

Prior to the deadline it had 8,503 registrants. But on Wednesday the figure dropped to 6,912, meaning almost 1,600 companies have come off.

The commission has now offered a grace period of two weeks to file data to get back on.

Entities no longer on the list include: GDF Suez; Lloyds Banking Group; G4S; Bank of America; and the Tobacco Vapor Electronic Cigarette Association.

Several firms posted figures dating to 2013 instead of 2014 by way of compliance on giving “latest available” data.

Others posted figures which make little sense, some, most likely, because they hit the wrong key on their computer.

US and Chinese engineering giants GE and Huawei claimed they couldn’t find 2014 information and posted 2013 figures only.

IT firm Microelectronica, pharmaceuticals company Pfizer, and energy firms SNC Lavalin and Socar, among others, posted figures of more than €1 million for the previous reporting period, but suddenly declared less than €10,000.

For its part, Corporate Europe Observatory, a Brussels-based pro-transparency NGO, noted it's normal that banking costs went up due to the high amount of post-crisis EU financial regulation.

But they said Goldman Sachs' initial declaration of just €50,000, for one, looks like deliberate “under-reporting”.

The NGO’s Erik Wesselius told EUobserver that some anomalies arose because “it's still very easy to make factor 10 or even factor 1,000 mistakes in declaring lobby costs” due to the register’s templates.

The banking firms under scrutiny and commission officials responsible for the register couldn’t be reached for comment on Tuesday.

Lobbying firms

In terms of dedicated lobbying firms, the new declarations say Fleishman-Hillard (€6.5mn) is the largest in the EU capital.

The next biggest is Hill & Knowlton (€5mn), followed by G Plus (€3.25mn), Cabinet DN (€3mn), Weber Shandwick (€2.75mn), Grayling (€2.5mn), Rohde (€2.25mn), FTI Consulting (€2mn), Fipra International (€2mn), and Brunswick (€1.25mn),

But consultancies’ declarations also contain anomalies.

Some of the largest - Burson-Marsteller, Apco, Kreab Gavin Anderson, Hume Brophy, and Edelman - which posted multi-million figures in previous periods all filed less than €10,000 each.

Fleishman-Hillard’s spending was €6.5 million last year, down from €11.5 million in 2013.

Tobacco

With bank figures on the up, tobacco declarations are down, after the EU wrapped up work on recent legislation in early 2014.

Philip Morris, for instance, filed €1.5 million for last year compared to €5.2 million the year before.

The sector is far from quiet, however. Total spending by Philip Morris, Japan Tobacco, Imperial Tobacco, and Swedish Match was €2.8 million last year.

A trade body, the European Smoking Tobacco Association, declared a further €0.5 million.

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