Thursday

21st Nov 2019

Barroso cleared on 'image of greed' bank job

  • Commission president Jean-Claude Juncker (left) applauding the unveiling of a portrait of his predecessor, Jose Manuel Barroso (right). (Photo: European Commission)

European Commission ex-president Jose Manuel Barroso did not violate EU rules when landing a top job with Goldman Sachs, an EU ethics panel said, adding it was not asked to judge whether the current code on post-office behaviour was strict enough.

The ruling, published on the commission’s website on Monday (31 October), also stated that Barroso lacked judgement by associating the EU with the ”negative image of financial greed” symbolised by the US investment bank, which played a role in triggering both the 2007 global financial crisis and the Greek debt crisis, ongoing since 2009.

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Barroso, a Portuguese former prime minister, headed the EU commission for 10 years (2004-2014).

The news that he had been offered a position as non-executive chairman at the bank in July, shortly after Britain voted to leave the EU, set off a public outcry.

More than 216,000 people signed two petitions demanding that strong measures were taken against Barroso and that the limitations on former commissioners' conduct should be tightened.

The commission has taken the calls lightly, even locking the doors of its headquarters when the petition-makers came to hand over signatures.

Current commission president Jean-Claude Juncker has also defended his predecessor.

He said Barroso followed the rules, which state that ex-commissioners must seek approval to take up positions during a “cooling off” period of 18 months after they step down.

Barroso joined Goldman Sachs 20 months after leaving office.

However, after an intervention by the European ombudsman Emily O’Reilly - who recalled that article 245 of the EU treaties bestows on commissioners an open-ended duty to behave with integrity both during and after their term of office - Juncker referred the case to the commission’s ad hoc advisory committee.

The body is made up of three members: Christiaan Timmermans, a former judge of the European Court of Justice; Heinz Zourek, who served as director-general at the commission during Barroso's term in office; and ex-MEP Dagmar Roth-Behrendt.

The trio found that the code is "vague" on ex-officials' duties, but allows them to take up positions after the end of the cooling-off period.

They also believed Barroso when he wrote in a letter to Juncker that he would not lobby on behalf of his new employer.

Upon his appointment, Barroso told the Financial Times that his duties would entail advice to “mitigate the negative effects” of Britain’s vote to leave the EU.

A flawed process?

”Whether the code is sufficiently strict in these respects is not for the committee to answer. It must base its opinions on the code of conduct as it stands,” the panel said.

The ruling will hardly satisfy those who urge the commission to bring its former boss to book.

The European ombudsman issued a statement on Monday to say she remained worried both about the Barroso case and the current rules on commissioners’ conduct.

”The ombudsman will now reflect on the next steps – including a possible inquiry - she will take in relation to this important issue,” the statement said.

O'Reilly recently told this website she had been taken aback by the commission’s stubborn insistence that the rules had been met when so many people claimed otherwise.

"The code of conduct is only the commission's interpretation of article 245," she said.

The ethics panel gathered "very fine people", but could be broadened to five or seven members, who did not all have a background in the EU apparatus, she added.

Corporate Europe Observatory (CEO), a transparency watchdog, was angered by the committee's ruling.

"It looks like the current recommendation was formed without interviewing Barroso. The committee has simply accepted his statement that he won’t lobby for Goldman Sachs without even probing what is meant by ‘lobbying’," CEO's Vicky Cann said in a statement.

“Combine flawed rules with a flawed process and you get the flawed recommendation we are now seeing," she said.

Alberto Alemanno, professor of EU law at HEC Paris, said in a blog post the panel's interpretation was so narrow that it left article 245 without an 'effet utile'.

The commission should both sharpen the rules and make better use of those in place, he said, and send a strong message to future EU leadership that people no longer accepted the 'revolving door' between EU office and business.

“It may have been acceptable ten years ago, but that is not longer the case," he told this website.

A spokesman for the European Commission said on Monday the EU executive would evaluate the recommendation before taking any steps.

Barroso had deeper ties to Goldman Sachs

The US bank made "confidential" suggestions on changes to EU policy changes during the former Commission chief's time in office, newly released documents reveal.

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