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The EU Response to the Paradise Papers

NEWS, PUBLIC AFFAIRS
paradise papers

“Now is the time to look ahead, at the future of taxation, for a competitive and fairer Europe”. This statement from Pierre Moscovici, the EU’s top taxation official, comes after a succession of tax evasions...

“Now is the time to look ahead, at the future of taxation, for a competitive and fairer Europe”.

This statement from Pierre Moscovici, the EU’s top taxation official, comes after a succession of tax evasions scandals in recent years which have pushed the European Commission to adopt a strong position on the issue and focus its efforts on improving tax legislation and hunting down alleged tax-dodging companies and tax havens.

Contents

  • What are the Paradise Papers and why are they so important?
  • Overview of the Paradise Papers public hearing at the European Parliament
  • What is the EU doing and why does it matter?

Download the briefing here

Interested in tracking the European debate and gaining insight into how it may impact you and your business?

Contact Edelman Brusssels to learn more.

Australian Citizenship Status Undermining Turnball Government

GENERAL, GOVERNMENT AFFAIRS

The Turnbull government is facing minority status and a difficult by-election after Australia’s High Court found the entire leadership of the National Party — Deputy PM Barnaby Joyce and Nationals deputy leader Fiona Nash —...

The Turnbull government is facing minority status and a difficult by-election after Australia’s High Court found the entire leadership of the National Party — Deputy PM Barnaby Joyce and Nationals deputy leader Fiona Nash — ineligible to stand at the 2016 election, due to their citizenship status under section 44 of the Australian constitution.

Mr Joyce will now face a by-election in the seat of New England, likely to be called on the 2 December, with a writ issued by the Speaker of the House today. Joyce is one of five federal MPs to be unanimously knocked out by the Court. It also found former Greens senators Scott Ludlam and Larissa Waters were not validly elected, along with One Nation’s controversial Senator Malcolm Roberts and the National Party’s Fiona Nash.  Nick Xenophon and Matt Canavan have been ruled eligible, though Nick Xenophon will leave Federal politics to pursue a career in State politics in his home state of South Australia.

In terms of the immediate fall out, Matt Canavan will return to Northern Australia and Resources Minister; Prime Minister Malcolm Turnbull will take on Agriculture and Water Resources, and Mitch Fifield will take on Regional Communications from Fiona Nash – Darren Chester will take on her other portfolios.

The issue of citizenship was raised in July this year following the resignation of Greens Senator Scott Ludlam who resigned from the Senate after it was brought to his attention he held dual Australian and New Zealand citizenship, rendering him ineligible to hold elected office in the Federal Parliament under section 44 of the Australian Constitution.

He became the first casualty of the 2017 Australian constitutional crisis. Ludlam’s resignation led to a number of MPs and Senators publicly clarifying their citizenship status, and also led to fellow Greens Senator and Deputy Leader Larissa Waters’s resignation four days later, after discovering she held Canadian citizenship.  A swathe of allegations regarding eligibility followed, which resulted in the establishment of the Citizenship Seven – referred to the High Court for assessment.

These rulings have plunged the government into disarray.  As a minority government, Turnbull’s slim grip on power will be tested in the result of the forthcoming New England by-election.   If the seat is not won by a Liberal or National candidate, the current government will cease to maintain its one seat majority, forcing a Federal election early next year.

Joyce’s dismissal also leaves open to challenge every ministerial decision he has made, as well as those made by Ms Nash, since October 20 last year.

Legal advice obtained by the ALP confirms that under section 64 of the constitution a person can only act as a minister for three months without being a member of Parliament. Mr Joyce is now invalid as an MP from the time of last year’s election on July 2, and the only decisions which are valid are those which he made in the first three months as minister after he was sworn in on July 19.

Ultimately, the impression that the Turnbull government is notable only for its chaos and instability has been reinforced.  If a Federal election is triggered by the result of the New England by-election, we could be facing yet another leadership change and an inevitable impact on business and consumer confidence.

Briefing note on the situation in Catalonia

NEWS, PUBLIC AFFAIRS
situation in Catalonia

The situation in Catalonia is complex.  For more than three decades the Regional Government of Catalonia (with a strong ruling and executive autonomy according to the Spanish Constitution) is trying to obtain further fiscal benefits...

The situation in Catalonia is complex.  For more than three decades the Regional Government of Catalonia (with a strong ruling and executive autonomy according to the Spanish Constitution) is trying to obtain further fiscal benefits from the Central Government. Negotiations on this front have had little success and for that and  for other historical demands over the last few years the Catalan government (Generalitat) has boosted its positioning claiming for an independence from Spain. To do so over the last couple of years the Catalan government has undertaken a campaign aiming at celebrating a referendum for Catalonia to decide its independence on October 1st.

This process is illegal as it does not respect the Spanish Constitution requirements nor the Catalan government’s current legislation. This situation has led to a strong mobilization by the Catalan government and a segment of Catalan citizens, students and supporters of independentists parties. From a civil society perspective this process is being opposed by the business community, most of the media, academia and intellectuals. The latter are mostly on the left ideology spectrum but strongly oppose the lack of democracy and respect of the law from the Catalan government in managing this so-called independence process.

From a legal perspective, though the Catalan government is keeping on saying publicly that the referendum will take place on October 1st, it will have no legal value at all in case it happens. We can expect ongoing street demonstrations in the next few days which will be echoed by the national and international media. The only way forward is that both, central and Catalan governments, engage in a political dialogue to set up the basis for a legal revision of Catalonia membership to Spain according to the Constitution and the full respect of the civil rights of all Catalonia citizens including the ones not in favour the independence process.

Another important part of the civil society supports ‘the right to decide’ and stands up for an open dialogue and the possibility of negotiating a future referendum with guarantees within the legal framework.

Despite measures being taken by the Spanish justice system and the authorities to prevent a planned illegal referendum on Catalan independence from taking place on Sunday, the regional premier, Carles Puigdemont, was determined on Thursday night that the poll would go ahead.

Get the full briefing note here.

Subsequent notes

Summaries of the recent events and some decoders to understand this awkward political situation have been prepared by Edelman Spain

  1. Reactions to the referendum 
  2. Fallout from the referendum
  3. The declaration of independence

 

German Federal Election Cheatsheet

NEWS, PUBLIC AFFAIRS
German Federal Election Cheatsheet

Germany has voted yesterday. The government of CDU/CSU and SPD – the Grand Coalition – suffered significant losses. The Social Democrats have already announced that they will no longer continue with the coalition. Thus, Angela...

Germany has voted yesterday. The government of CDU/CSU and SPD – the Grand Coalition – suffered significant losses. The Social Democrats have already announced that they will no longer continue with the coalition. Thus, Angela Merkel has a chance to form a new coalition with the FDP and The Greens. At the same time, the AfD (Alternative for Germany), a right-wing populist and nationalist party, have entered parliament as the third strongest party – and will change the political climate in Germany.

  • What was the turnout like?
  • Who are the big winners and losers?
  • What are the options for forming a government?
  • What are the next steps?

An overview of the current developments and initial assessments has been prepared by Edelman.ergo

Download the German Federal Election Cheatsheet here

German Federal Election Cheatsheet

Tokyo Metropolitan Assembly Election: A Political Shake Up in Japan

NEWS, PUBLIC AFFAIRS
Tokyo Metropolitan Assembly Election

This past weekend, an assembly election for Tokyo’s Metropolitan Government resulted in a sweeping victory for populist Governor Yuriko Koike’s Tomin First no Kai, or “Tokyo Citizens First” Party. Most notably, it saw Prime Minister...

This past weekend, an assembly election for Tokyo’s Metropolitan Government resulted in a sweeping victory for populist Governor Yuriko Koike’s Tomin First no Kai, or “Tokyo Citizens First” Party. Most notably, it saw Prime Minister Shinzo Abe’s Liberal Democratic Party (LDP), the nation’s long-standing ruling party, receive a record low of only 23 out of 127 assembly seats—down from its current 57 seats. This is a direct reflection of the recent nose dive in popularity experienced by Prime Minister Abe and the LDP following a string of scandals and criticisms in recent months.

The city election is widely considered a precursor to the national election. Until recently, Prime Minister Abe—who is currently Japan’s third-longest serving premier since World War II—has been expected to be re-elected by the LDP for a third term next year, which would make him the longest-serving Prime Minister in history. In fact, a Prime Minister is currently allowed only two terms with the LDP, but, due to Abe’s high popularity, the LDP has been planning to adjust the rules to permit a candidate to run for a third term. This would allow him to carry out his agenda and retain the legacy of serving during the Tokyo 2020 Olympics. However, this sudden revelation signals the possibility that he could be replaced by the national elections in December 2018.

A former LDP member, Governor Koike is the first female leader of the nation’s capital. She angered senior LDP members when she ran for Tokyo governor last year and, again, when she defected from the party last month to form Tomin First no Kai, citing the LDP as an anti-reform “old boys’ club.” She campaigned on a reformist agenda focused on open government and cost-cutting. Now at 64, she was formerly a TV newscaster before serving as Minister of Environment and Minister of Defense. Several speculate that she will eventually return to parliament to run for Prime Minister. Considering her strong track record in government, her high approval ratings, recognition for being media-savvy, and fluency in English and Arabic, she is well-positioned for the role.

People in Japan have generally been apathetic toward politics, but a recent wave of energy and attention is coming to the surface. With a background as a newscaster and one of the first prominent female political personalities in Japan, Koike has attracted audiences previously uninterested in politics. In fact, this election had an 8% increase in voter turnout from the previous poll four years ago—up from 43% to 51%, which is higher than usual for Japanese voters. This is due to both her popularity, as well as the recent public incidents faced by Prime Minister Abe and his party. For example, a highly uncommon occurrence, this weekend brought protestors to rally at a public speech by the Prime Minister; LDP members were later disparaged for trying to cover their signs and criticizing them for their interference.

However, this swing in public favor is not a complete surprise. Over the past 12 months, Prime Minister Abe and the LDP, which has been the ruling political party in Japan for all but four years since 1955, has received significant criticism for ramming through several pieces of controversial legislation which lacked public support. Among these include an “anti-conspiracy law” which allows arrests to be made before a criminal act, another law which allows Japan to exercise its right to collective self-defense, and the legalization of casino gambling in Japan. Abe has also been aggressively pushing to revise the national Constitution which has gone untouched since the end of the war. In addition to all of this, the Prime Minister has become entangled in allegations of favoritism and rumors of corruption.

At the same time, a heightened interest in the Tokyo Governor has developed due to heated debate about the relocation of The Tsukiji Market, Tokyo’s famous international fish market, and government spending for the 2020 Olympics. Additionally, three Tokyo governors preceding Koike stepped down because of public scandals. It has also become clear there is a groundswell of frustration with the old, traditional system and a desire for reform—a societal momentum which Governor Koike leveraged successfully. Not only has she emerged as the only politician who poses a real threat to the dominance of the LDP, but the prominence of her role as the Tokyo Governor will be stronger over the next few years than previously expected.

We can expect an equal level of attention to be given to the national election next year. Additionally, we can expect a flood of new LDP candidates shooting to replace Prime Minister Abe and primed to compete against a possible Koike run in a few years’ time. In the near term, although it is obvious all discussion about Constitutional reform will be muted, we don’t expect much to change in terms of the existing legislative calendar.

Interestingly, the scenario playing out now is a realization of the findings in Edelman’s 2017 Trust Barometer released earlier this year, which indicated a possible movement in Japan toward populism as seen in other parts of the globe. In the survey, Japan was ranked “below global average” for their faith in the system—only 13% of respondents in Japan said they believe the system is working—and 53% expressed concern for widespread corruption. Most notably, nearly 3/4 of respondents in Japan found the “Reformer” more believable than the “Preserver of the Status Quo”. Although it’s unlikely Governor Koike, the reformer, will scale her “Tokyo First” platform to a national level, its clear that Japan’s political environment is heading for change.

Written by the Edelman Japan Public Affairs team

UK offer on EU citizens' rights post-Brexit

BREXIT, EU AFFAIRS
EU citizens' rights post-Brexit

The UK government has today published its formal offer on EU citizens’ rights post-Brexit. If accepted, this would allow the status of the million or so UK nationals in the EU to be settled. This...

The UK government has today published its formal offer on EU citizens’ rights post-Brexit. If accepted, this would allow the status of the million or so UK nationals in the EU to be settled. This will be a key element of the first stage of the Brexit talks.

Edelman has gathered the reaction and pulled out the key points of the proposal and analysed where the sticking points will be – already the EU’s chief negotiator Michel Barnier has responded by calling for “more ambition, clarity and guarantees than in today’s UK position”.

Download the full briefing here

With a team of consultants from across the political parties and straddling the EU Referendum divide, Edelman’s Public Affairs team is superbly placed to give you insight, analysis and advice on the Brexit negotiations and on the new Parliament. Get in contact here.

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