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Does the State of the Union speech offer entry points for the Single Market for Philanthropy?

17 September 2020

The President of the European Commission Ursula von der Leyen delivered her first State of the Union speech during the European Parliament´s Plenary session yesterday on 16 September 2020. She presented her vision for a Europe that emerges stronger from the pandemic and leads the way towards a new vitality to enable Europe to become green, digital and more resilient. After calling the EU “a community of values”, she put emphasis on the need to reinforce the European Green deal and to lead the digital transformation. Referring to current developments in the EU’s closest neighborhood (e.g. Belarus, Turkey) she stressed the need to respond more assertively to global events and to deepen relations with global partners. As a part of the global ambitions of the EU, the president promised a proposal for the European Magnitsky Act to impose sanctions on human rights abusers.

And what’s in it for our work around operating environment of philanthropy? The PA Secretariat identified the following key entry points:

  • The President underlined the human aspect of economy that protects us against the great risks of life - illness, ill-fortune, unemployment or poverty, which creates opportunity and prosperity by promoting innovation, growth and fair competition. “SMEs are the motor of our economy and will be the engine of our recovery. This is why the Commission created the SURE programme.” PA has in this context stressed and will continue to stress that recovery measures such as SURE do not only focus on SMEs/businesses but also cover public benefit organisations including foundations.
  • The President also stated the ambition “To make structural reforms in our economies and complete the Capital Markets Union and the Banking Union. Deep and liquid capital markets are essential to give businesses access to the finance they need to grow and invest in recovery and in the future.” Philanthropic investments are part of the capital market and investing cross- border in tax effective ways should be facilitated.
  • The most important entry point for philanthropic sector is the President´s call for a fully functioning Single Market. “The Single Market is all about opportunity - for a consumer to get value for money, a company to sell anywhere in Europe and for industry to drive its global competitiveness. We must tear down the barriers of the Single Market. We must cut red tape. We must step up implementation and enforcement. And we must restore the four freedoms – in full and as fast as possible.” We will continue to stress that the single market does not yet work for philanthropy. With our manifesto we are calling upon policy makers in Europe to work towards it by working towards a better recognition of philanthropy in EU legislation as well as at national level; supports cross-border philanthropy across the EU; and decreases today’s barriers for philanthropy in order to leverage the impact of donors’ and foundations’ spending of private resources for public good.
  • The rule of law had a prominent role in the President´s speech referring to the adoption of the first annual rule of law report covering all Member States. PA intensively advocating for the values enshrined in the Art 2 of TEU welcomes president’s words “I want this to be a starting point for Commission, Parliament and Member States to ensure there is no backsliding. The Commission attaches the highest importance to the rule of law. This is why we will ensure that money from our budget and NextGenerationEU is protected against any kind of fraud, corruption and conflict of interest. This is non-negotiable. But the last months have also reminded us how fragile it can be. We have a duty to always be vigilant to care and nurture for the rule of law. Breaches of the rule of law cannot be tolerated. I will continue to defend it and the integrity of our European institutions. Be it about the primacy of European law, the freedom of the press, the independence of the judiciary or the sale of golden passports.”

 

In the morning of the speech President von der Leyen sent a Letter of Intent to President Sassoli and Chancellor Merkel – on behalf of the German Presidency, in which she detailed the actions the Commission intends to take in 2021 by means of legislation and other initiatives.

We consider that the following initiatives imply opportunities and things to watch out for sector’s operating environment:

An economy that works for people:

  • Legislative proposal on an investment protection and facilitation framework
  • Revision of the Markets in Financial Instruments Directive and Regulation
  • Legislative proposal on sustainable corporate governance
  • Proposal for a legislative package on anti-money laundering
  • Action Plan on the European Pillar of Social Rights
  • Action Plan for the Social Economy

Promoting our European way of life:

  • Communications on an EU agenda to tackle organised crime and on counter-terrorism

A new push for European democracy:

  • Proposals to extend the list of EU crimes to all forms of hate crime and hate speech
  • Revision of the Regulation on the Statute and Funding of the European Political Parties and European Political Foundations