Public vs private

A former European Commissioner's proposal to join the board of budget airline Ryanair just two months after retiring from Brussels has sparked discussion over the possible conflicts of interest that can develop when public figures decide to cross over into the private sector – and concern that measures in place to prevent these conflicts of interest don't go far enough.

A European Commission ethics committee is mulling over whether former Internal Markets and Services Commissioner Charlie McCreevy, who left his post in February, would breach Lisbon Treaty regulations if he were to accept a position as a non-executive director of Ryanair. The company has a long-running – and fraught – relationship with Brussels: seven of Ryanair's contracts with European airports are subject to long-running state-aid inquiries by the commission. These are not, however, managed by McCreevy's former portfolio.

Under the Lisbon Treaty, former European commissioners are obliged to "behave with integrity and discretion as regards the acceptance … of certain appointments or benefits." They must also inform the commission if they intend to take up any new position within a year of leaving the executive body. When this happens, the commission's Ad Hoc Ethics Committee reviews the proposal and makes a recommendation to the commission as to whether or not the new post might overlap with the former commissioner's duties for the European Union and therefore present a conflict of interest.

A well-trod path

McCreevy would hardly be the first public figure to take up a position in the corporate world, and the majority of those who make this switch do so legitimately. But possible conflicts of interest are an ever-present concern, and Berlin-based international corruption watchdog Transparency International says the regulations in place to prevent them from arising in Europe need to be strengthened.

"It is important, to prevent conflict of interest, to ensure that all former commissioners take some sort of a cooling off period after they end their job in the European Commission, after their term is finalised, in order to prevent a situation whereby they can sort of abuse the powers that they used to have," Jana Mittermaier, head of Transparency International's Brussels office, said.

Though the word 'corruption' calls to mind above all theft, bribes and cronyism, Mittermaier said it often takes a far more insidious form – and that Europe is not immune. "The [European Union] is very diverse and it's not free from corruption at all … we found out that in the western European Union member states, you have more a grand, private-sector related type of corruption, and conflict of interest does play a role in this context for sure."

This kind of corruption could be something as simple as an ex-official using his or her insider knowledge of a government to gain an unfair advantage in lobbying – or it could suggest a public official who assists a firm while still in office, only to join that firm on leaving government.

Blurred lines

In December 2005, when former German Chancellor Gerhard Schroeder accepted a position at Russian gas company Gazprom shortly after stepping down from his government position, the Washington Post called it a "sellout" move. The newspaper pointed to Schroeder's support, while still in office, of the controversial Nord Stream pipeline project, and wrote that Schroeder's move to Gazprom should "raise questions in German voters' minds about the real reasons Mr. Schroeder was so keen to see this pipeline project launched … Many have wondered why Germany chose to go along with this project. Could it have been because the former chancellor realized that he was, in effect, creating his own future place of employment?"

Similar concerns were raised in 1999, when German politician and acting European Industry Commissioner Martin Bangemann announced that he planned to move to the executive board of Spanish telecommunications giant Telefonica – controversial because he had been responsible for EU information and telecommunications policies since 1992. Bangemann was subsequently dismissed by the commission, and the ensuing scandal was one of the deciding factors in the push for the development of the European Code of Conduct for Commissioners (CoCC).

Simple measures could cut corruption

Mittermaier said the best way to avoid these kinds of concerns is to enforce a cooling-off period between when public officials leave office and when they take up a new position that could overlap with the area in which they worked in a public capacity. Transparency International has called for a mandatory three-year cooling-off period to be introduced – currently, according to the CoCC, former commissioners can take up new posts immediately after leaving the commission, although if they wish to do so within one year of leaving the commission they must report their intentions – and for sanctions to be introduced to enforce the CoCC.

Indeed, an independent 2009 report commissioned by the European Parliament's own Committee on Budgetary Control to examine the effectiveness of the CoCC recommended the commission move "to extend the post-office employment restrictions to two years after leaving office, and to require a minimum time of notice between notifying post-office employment and engaging in this activity." The report also noted that no clear criteria existed to help the Ad Hoc Ethics Committee determine whether a new position might compromise a former commissioner's "integrity and discretion".

However, Michael Mann, a commission spokesperson, said that there were no plans to extend the post-office employment restrictions to two years or develop additional criteria, saying that the Ethics Committee takes a "broad-ranging" approach when it makes its recommendations. He added that the cooling off period outlined in the CoCC is irrelevant – even once the year has passed, former commissioners "are bound by the Lisbon Treaty for the rest of their days". That is, a former commissioner would still have to satisfy the "integrity and discretion" clause when considering new positions even five or 10 years after leaving his or her post – but he or she would not have to inform the commission before taking up that new post.

Mann said that there were no plans as yet to introduce specific sanctions for former commissioners who refused to comply with the recommendations of the Ethics Committee, saying he was not aware of this having been an issue since the CoCC was introduced in 2004. He added that the commission already has legal recourse in the event of this situation occurring. "Hypothetically, if it did happen, the Commission could take them to the European Court and it might affect their pension," Mann said.

As for McCreevy and the board of Ryanair, the Ethics Committee is expected to make its recommendation soon, having already given the green light to four other former commissioners this week.

A Ryanair spokesperson told Deutsche Welle that "Ryanair doesn't comment on rumours and speculation."

Author: Sophie Tarr
Editor: Sam Edmonds