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28th May 2022

Lobby links with Russian oil giant Lukoil look hard to break

  • The pressure is on Europe's business associations to remove links with Russian firms, particularly those involved in energy (Photo: European Commission)
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Even as Brussels lobby groups rush to part ways with their Russian clients — breaking up still can look hard to do.

Take BusinessEurope, which holds more meetings with EU policymakers than any other lobby group in the EU capital.

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BusinessEurope had listed Lukoil, a Russian multinational headquartered in Moscow and one of the largest global producers of crude oil, as one of its "partner companies" on its website.

When EUobserver contacted Business Europe about the relationship, BusinessEurope provided a link to a list of partner companies which did not include Lukoil.

But an internet archive shows Lukoil was previously listed as a member of the group.

Later a spokesperson confirmed it suspended Lukoil membership on 1 March, "when we, logically, removed Lukoil" as a partner company from its website.

In the case of BusinessEurope, the benefits of being a partner company include high-level contacts with the EU institutions, high-level meetings with guests such as EU commissioners, and their heads of cabinet, as well as lawmakers.

The pressure is on Europe's business associations to remove evidence of links with Russian firms — particularly those involved in selling Russian energy, widely regarded as helping to fund the Kremlin's ability to wage war in Ukraine.

But efforts made in some cases appear rushed and confused — more aimed at managing reputational fallout than at a commitment to shift to doing business radically differently with Russian interests.

The pressure is coming, from among others, the German Green lawmaker Daniel Freund.

Freund has named Lukoil as one of eleven Kremlin-linked companies with Brussels lobbyists he said should be banned from the EU institutions.

Asked about BusinessEurope apparently removing Lukoil from its website after a media question, Freund said that showed the need for a lobbying ban that goes beyond the EU institutions.

"If they are banned from the European Parliament, suspending their membership in umbrella organizations is the logical conclusion," Freund said, referring to companies like Lukoil.

Even so, there's no uniform agreement on how to deal with Russian businesses that lobby the EU institutions.

Some lobbyists arguing for some level of ongoing contact on the basis that corporate actors often want to stay out of political crossfire and geopolitical disputes — and at least one other major lobbyist, FuelsEurope, is standing by Lukoil.

"Lukoil's membership has currently been maintained," a FuelsEurope spokesperson said by email.

FuelsEurope's decision also followed a statement, by Lukoil, in which its board of directors expressed their "deepest concerns about the tragic events in Ukraine" and called for "the soonest termination of the armed conflict."

But FuelsEurope has "broken all ties" with Russian state-owned oil company Rosneft, "after analysing the positions of our Russian members," said the spokesperson. No money has been received from the firm in 2022, he added.

With businesses taking assorted positions on the ethical red lines of Russian trade, one industry leader has called on EU policymakers to set clearer rules for all European companies.

Axel Eggert, head of the European steel association Eurofer, is in the process of taking legal advice about the membership of the European arm of Russian steel company NLMK.

"We have a procedure you have to take before you can expel or suspend a member of Eurofer," he said. "It has to be fair. So, we have to assess all that."

Eggert has also informed World Steel, a global industry association, that he will not participate in its meetings while Russia is represented.

But he believes that these decisions should not be left to boardrooms.

"Policy makers need to take the decision," he said. "If policy makers were to say you have to cut anything where a Russian has a stake, then that's clear.

In that scenario, "the European steel industry will accept that as a necessity to stop the bloodshed," he said.

Like Eurofer, Business Europe and Fuels Europe are fully backing EU sanctions against Russian firms.

"Business is not happening in a vacuum and will stand behind the measures considered necessary by EU institutions," said a statement on the war issued by BusinessEurope.

FuelsEurope said: "We support the response of the international community and offer our industry knowledge to governments to help mitigate consequences for European citizens."

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