Introduction

As ballot boxes close and the final votes are being counted, we have begun to see what the composition of the 2024-2029 European Parliament might look like. Whilst over the coming weeks parties will be swapping groups and a number of the non-aligned MEPs will attach themselves to political groups, as predicted, the European Parliament has taken a shift to the right.

The impact of this election goes beyond the Parliament and will likely play a hand in the selection of the new Commission President. Ursula Von der Leyen is the front runner and expected to have another term, however it is not as straight forward as that. She will need at least 361 votes and whilst on paper it seems as though she can get this through a grand coalition of the European People’s Party (‘EPP’), Socialists and Democrats (‘S&D’) and Renew – covering the centre right, centre and centre-left respectively, if last year’s vote is anything to go by there is no guarantee that all MEPs will vote in favour. As such, Von der Leyen is likely to have to look towards either the European Conservatives and Reformists (‘ECR’) or the Greens to find the votes. The bind that Von der Leyen will find however, is that concessions to the Greens will not be accepted by many in the EPP, whilst any deal that brings in the ECR will be rejected by the S&D as noted in the press conference following the exit polls. As such, there will no doubt be fierce negotiations over the next weeks and months where concessions and promises of top jobs will no doubt be made.

What does this mean in terms of output from the EU next year?

As with any change in government where are things that we must look out for, here are the top 5 things that our team think you should look out for in this next mandate:

Harder lines on third countries

Whilst we already started to see this towards the end of the last mandate, we are expecting to see a much more inward looking European Union. One of the focusses of this next mandate will be economic security and EU competitiveness. As such we expect to see a championing of EU businesses and higher barriers to entry applied to third country firms. For some sectors, we may even see tax exemptions and a relaxing of state aid rules.

A disruption in the process

The Parliament works on consensus politics and therefore there are always compromises made between parties. This often leads to certain provisions being introduced to satisfy certain groups or parties. In the last mandate for example a strengthened Green group saw a number of green provisions enter into files. With a composition change, the compromises found, and certain provisions introduced will likely reflect a right leaning Parliament. The other aspect that clients will need to consider is that files that were not closed at the end of the last mandate could take a different direction under the new parliament or even be dropped. 

A paring back of the Green agenda

One thing that will be for certain is that the green agenda will be pared back. As witnessed by the Greens losing 27% of its seats, there was a strong backlash against the Green Agenda. However not just by the losses in the Greens. In the last mandate there was support (albeit weak) from the EPP. However, in recent months, there is growing scepticism from those within the group, especially those towards the right of the group, who are not supportive of the targets set.

Disruption to bringing down internal borders?

Over the last mandate, the EU has been gearing up to break down internal borders. You will have noticed a shift from directives to regulations in a bid to develop the single market and reduce the friction. Whilst for a number of files this is already over the line and the Parliament will not be involved in the implementing rules that the European Supervisory Authorities (‘ESAs’) are drafting, we can expect that new files may come up against resistance on powers given to the ESAs or that look to take power away from the Member State. This puts the EU in a difficult position as it has been noted one of the barriers to growth is the lack of integration.

Considerable number of first time MEPs

Whilst there is always turnover in a new parliament, given the consensus politics mechanism and the direct impact that individual MEPs have on files, turnover in the European Parliament is a risk that needs to be managed. Even more so when it is at 60%. As files within the EU become increasingly technical and the volume of legislative files increase, it will be important for clients to get in front of MEPs and arrange teach-in sessions to get them up to speed.