“There is a clear delay between the pace of the digital revolution and potential regulatory measures.”
You are covering whole range of topics such as Internal Market and Trade policy. Let´s start with international trade and new EU trade strategy. What are the opportunities for the EU in global trade? On which part of the World should we focus and what form should the negotiations take?
I personally welcome the Commission´s new Trade and Investment strategy, because I believe it is a much needed and long awaited document. For the EU, which is a global leader and trendsetter in this field, trade is one of the key areas of its policies. With the new strategy there is an emphasis put on the crucial link between trade opportunities and growth and jobs generated in the EU. More liberalized trade with our main partners creates more jobs in the EU and thus contributes to its growth. This is one of the premises on which we should base all of our future negotiations. But above all, we need to deliver concrete benefits from trade agreements to our companies, especially small and medium enterprises. When it comes to the regional focus you were raising, I am convinced that first of all we must undergo a stock-taking exercise of all the ongoing negotiations. I am concerned by long lasting talks, some of them have been blocked for quite a while and we should be able to say whether there is a common will to continue on these or not. As a priority, we have to conclude those negotiations currently taking place with our key trade partners such as the USA and Japan. But I see a great potential for our companies also in Latin America and Asia.
Conclusion of the TTIP negotiations will not happen in 2016. In November, the US will hold presidential election and we have to expect a slowdown in EU-US talks. Do you see it as opportunity or threat?
I believe we should stick to our ambition to conclude the TTIP in 2016. You mention the presidential election taking place in the US next year. It is hard to foresee the exact impact this could have on the TTIP negotiations, however, I think that there is a common shared vision, both in the US and in the EU, that such an agreement has its merits and it should be concluded. We have advanced quite well so far, and it would not be beneficial to either side not to conclude it soon. I can imagine a sort of slowdown, as you put it, linked mainly to eventual changes in the US administration, but not to the point that I would call it a threat. The EU and the USA are natural trade partners, strategic partners as well, and TTIP could bring this relationship to another level, making both sides of the Atlantic work closer and providing businesses with real new opportunities.
Yet, in the context of EU-US cooperation, European and American businesses were shocked by the decision of the Court of Justice of the EU on Safe Harbour. Was it a “wise” decision?
Well, it would not be correct to make comments on the Court of Justice´s decision as to whether it was wise or not. The Court acts independently and is, without any doubt, able to duly justify its reasoning and judgements. We should take this decision as a matter of fact. The Commission has to analyse what kind of legal situation we are in right now and make it clear also for the companies. There were over 4000 of them using Safe Harbour and they deserve to know what will happen now. I think that we all know how important the data protection issue is for us, here in the EU, and we should make it possible for European´s consumers data to be handled cautiously and following clear rules, also by non-European actors. We spoke about TTIP a little bit ago, I believe that we have to find a relevant solution to the data protection issue also for the sake of this agreement.
In summer 2015, the European Commission suggested to grant China market economy status. The decision is likely to split Europe but also businesses across different sectors. Do we need more time to study potential impact of the decision?
This is a very important question, thank you for raising it. It is my impression that we do not pay enough attention to this issue in the Czech Republic. However, the decision on whether to grant China market economy status or not will have far-reaching consequences. The Commission has not yet stated what its preference is. We heard about the legal analysis which might lead to the conclusion that the EU should grant it. Having said that, the Commission is currently working on a couple of analyses which should shed more light onto this question. I think that we should be very cautious in this matter and also listen to what our businesses have to say. We hear about the steel and ceramics sector but there are definitely many more areas which could be heavily affected by such a decision. Bearing this in mind, I am calling on the Commission to investigate alternative scenarios and make proposals on different types of trade defence instruments which could help us protect sensible sectors.
The Commission unveiled its Digital Single Market Strategy in May 2015. It is difficult to regulate digital market. First the regulation is coming with a delay in such a smart-growing environment and second, it can suffocate the innovation. What is your opinion on that?
I completely agree with what you have just said. There is a clear delay between the pace of the digital revolution and potential regulatory measures. But for me, the ultimate question is: how do we want regulate the digital world? Do we need rules for everything, or should we adopt a laissez-faire approach and let the market figure it out by itself? In my opinion, the answer is somewhere in between, but closer to the latter. The focus of our work must be on the removal of barriers and national requirements that prevent a true single market. Instead of creating new prescriptive requirements at the European level, I believe we must instead work on the principles and frameworks of how we want the market work and then let businesses implement those principles. I fear that if we are too prescriptive, our laws will be outdated from the moment they are adopted.
We are expecting a new proposal on online platforms in 2016. What would be the best regulation to this environment?
There is currently an ongoing public consultation run by the European Commission on the regulation of online platforms. I am very much looking forward to seeing what the different stakeholders´ views on it are. Personally, I believe that to simply and blindly apply ex-ante regulation on platforms, as with traditional services, will do more harm to consumers and businesses than they would benefit them. We as legislators should focus our work on ex-post remedies instead of focusing on ex-ante controls. In other words, acting only after there is a problem instead of putting limits on businesses and traders before they even begin to sell. When dealing with this matter, we need to think outside the box and come up with new ideas. I keep saying we should think digitally by default. Another issue is data protection. I believe every platform has a duty to protect the data of its users. Security, however, will never be perfect. Consumers must be informed of a breach and what has been stolen. If the stolen data could be used against an individual, companies should be required to help counterbalance the negative effects.
At the moment (beginning of December) the European Parliament is finalizing together with the Council the General Data Protection Regulation. Digital market is based on data. How can we ensured the highest level of data privacy?
Yes, indeed, as discussed earlier, the data protection is one of the key elements of truly functioning digital single market. Both for the citizens and for the businesses. I believe that the Commission struck the right balance with its proposal. It came with the idea of a general data protection regulation, because the EU needs a single set of rules. This would help not only consumers but also companies carrying out cross-border operations. But I guess we can do even better here, as the initial ambition included also lowering administrative burden for all the actors involved.
Digitalization of the economy creates new barriers on the Internal Market. However, there are still persisting barriers in traditional business such as cross-border provision of services. What can be done at EU level to remove barriers on the Internal Market?
I think there is an approach to take addressing challenges in the overall single market. It would be hard to further develop e-commerce without working on opening up the market in parcel deliveries, provisions of services on cross-border level or labour mobility. All these issues go hand in hand with the rapid development of online services. There are also other barriers we should focus on, such as geo-blocking, which we suffer from any time we cannot benefit from a service because it is reserved exclusively to residents of a different country than ours. In general, we have to fully apply the mutual recognition principle. Let me mention one of the areas which still suffer from overregulation – the liberal professions. There are barriers which deny professionals to access their fundamental European freedoms of movement and establishment. So this kind of unjustified barriers must be removed as they prevent fair competition between different actors. National regulations amount to protectionist measures, they constitute de facto non-tariff trade barriers. We need the services provision directive to be fully implemented so that the Czech and other European professionals or service providers can access other cross-border markets freely.
Last but not least, what do you think about current threat of terrorism in Europe?
I cannot express how shocked I was to learn about the terrible events last month in Paris. It makes me sad to think of it, not only because I have been living in France for the last six years. It is obvious that the EU is now more than ever a target for terrorist acts and that we have to be active in countering it. For the time being, I am a bit disappointed by the Commission´s reaction to the urgent challenges raised by the security situation. We had high ambitions after the attacks on Charlie Hebdo last January, however our reaction was far too slow, heavily bureaucratic and not accurately designed. The Paris attacks happened almost one year since the Charlie Hebdo events and we have to be honest with ourselves, nothing really changed since then. I think we should be more active in this field; the terrorists will not wait until some directives are ready. They might be willing to attack us again and I hope we can face them better.
Thank you for the interview!
Alena Mastantuono, Director of CEBRE
Dita Charanzová is a Czech Member of the European Parliament. She graduated from the University of Economics, Prague and later from the Diplomatic Academy in Madrid. Ms Charanzová completed a doctorate degree from Jan Masaryk Centre of International Studies in Prague. She is a former diplomat, whose postings included the Czech Permanent Representation to the EU during the Czech Presidency, where she led the Trade Policy Committee. She has also worked at the Council of Europe. Ms Charanzová is the ALDE spokesperson and ranking Member of the Internal Market and Consumer Protection Committee and a Substitute Member of the Committee on International Trade.