Washington Times (United Press International)

March 08, 2005 By Gareth Harding
Chief European Correspondent

Brussels, Belgium, Mar. 8 (UPI) -- There are not many growth industries in Brussels, the capital of Belgium and headquarters of the EU, but lobbying is definitely one of them.

Even by the European Commission's conservative estimates, there are 15,000 lobbyists in the city. Flick through the 500-pages of the European Public Affairs Directory, and you get an idea of what a magnet Brussels has become for lobbyists, lawyers and consultants. More than 2,600 interest groups are listed, ranging from the European Federation of Coffee Roasters to the European Bottled Watercoolers Association. There is even a European Association of Associations.

Lobbying is big business, with annual revenues estimated at $80 million to $120 million. This is small fry compared to the industry in Washington, but lobbying in Brussels only really took off in the 1980s, when the commission churned out over 300 laws aimed at creating a single EU market.

As the lobbying industry has grown, so have calls for its regulation. In the late 1990s, Brussels-based consultants drew up a code of conduct aimed at cleaning up the industry's grubby image. But in a landmark speech last week, commission Vice-President Siim Kallas said the code did not go far enough.

"Registers provided by lobbyists' organizations in the EU are voluntary and incomprehensive and do not provide much information on the specific interests represented or how they are financed," Kallas said. "Self-imposed codes of conduct have few signatories and have so far lacked serious sanctions."

Kallas, a former Estonian prime minister, plans to publish a "European Transparency Initiative" later this spring aimed at promoting openness in EU institutions and stamping out waste and fraud in the Union's $130 billion annual budget. "Secret government erodes the legitimacy of the European Union, and lack of information opens the dirty tricks department of 'make believe' spin," the commissioner told business students in the British city of Nottingham Thursday. "Lack of accountability results in a furious public opinion, which feels deceived and finally rejects the European project altogether," he said, referring to the growing disillusionment with the EU in many countries.

Kallas wants all member states to publish a list of individuals and organizations that together receive over $100 billion of EU agricultural and regional aid -- as Estonia and Denmark do. He also plans to shed more light on the activities of consultants in Brussels. "Lobbyists can have considerable influence on legislation, in particular on proposals of a technical nature," he said. "But their transparency is too deficient in comparison to the impact of their activities."

The vice-president did not spare non-governmental organizations from his invective, decrying the fact that over $2.5 billion of EU money was channeled through development groups with little attention paid to how it is spent. "In the Middle Ages the forests of Nottingham were famous for the courageous Robin Hood, the 'prince of thieves' who tricked the Sheriff of Nottingham and stole from the rich in order to help the poor. One may regard this legendary figure as an early NGO. His cause seemed noble, but his ways to redistribute wealth were not always quite transparent."

Freedom of information campaigners welcomed the commission's plans, which are likely to lead to tighter controls on lobbying activities in the fall. "We have no problem with lobbying as such," said Erik Wesselius of the European Corporate Observatory, an Amsterdam-based advocacy group. "But what you see in Brussels is an enormous bias towards corporate interests that are over-represented and have privileged access to decision-makers."

A recent study by the European Parliament showed that corporate lobbies, such as Hill and Knowlton and Weber Shandwick, outnumber social and environmental groups by a ratio of six to one. But David Earnshaw, managing director of the Brussels office of public relations giant Burson-Marsteller, contends that NGOs are winning the trust-ratings war. "They might not have the resources, but they are believed by the public."

Earnshaw, who previously worked for development group Oxfam, says that lobbying firms are perfectly capable of regulating themselves. "If you regulate strictly, the people who get hurt are the little people -- the people who do not have a voice -- not the people who can bend the rules." He also says the commission will have "big problems" defining who is a lobbyist. "If you are a Socialist, business is the lobbyist; but if you are a Christian Democrat, NGOs like Greenpeace are the lobbyists."

Earnshaw has a point. In Brussels, almost everyone working in or around the EU institutions is lobbying for something or someone. The UK Permanent Representation to the EU has over 200 staff all committed to furthering London's interests in Europe's capital. The European Trade Union Confederation has its headquarters in the city, the German region of Bavaria has recently acquired an immense Gothic mansion in the heart of the EU district to house its 20-plus team, and the U.S. states of Georgia, Kentucky, Illinois and Ohio all have offices here.

Wesselius argues that if U.S. lawmakers succeeded in defining what a lobbyist is, their European counterparts should be able to. He also contends that the EU "lags behind the United States" when it comes to lobbying rules. In Washington, lobbyists are obliged to publish which legislators they have met with, who their clients are and how their budgets are spent. Brussels-based consultants have no such constraints.

The United States might lead the way in terms of lobbying rules, but many American firms have still to wake up to the importance of Brussels as a law-making machine. In 2001, the commission blocked a $45 billion merger between General Electric and Honeywell. GE reacted with fury and indignation, but within months it opened swish new offices overlooking the EU executive.