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European Parliament shows its teeth

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How the SWIFT agreement marked a historic moment for the Parliament to exercise its powers and influence EU-US relations

On the 11th of February the European Parliament rejected the SWIFT-agreement between the EU and the US. This was the first time after the Lisbon Treaty entered into force in December 2009 that the European Parliament was able to criticize the Council on its policy in the area of Justice and Home Affairs. This Treaty gave the European Parliament the power to reject Council decisions in this policy area. Despite huge pressure from national governments and especially the United States the Parliament voted against an agreement which would arrange the transfer of banking details between the EU and the US. It was a historic moment for the European Parliament and therefore interesting to be further clarified. The US administration was ‘not amused’ by this decision and this raises the question of the extend to which this rejection has put the EU-US relationship under pressure.


Extending Parliament’s powers

A central concern in the Lisbon Treaty had been to grant the European Parliament more legislative powers. This has been done by extending the policy-areas in which decisions are taken by the co-decision procedure. This procedure places the European Parliament at the same level as the Council, which represents the member states. The most important change by the Lisbon Treaty is the introduction of the co-decision procedure as the ordinary decision-making procedure in the area of Freedom, Security and Justice, better known as Justice and Home Affairs. With the exception of a number of issues which are politically too sensitive because they touch upon the sovereignty of states, issues in the area of Justice and Home Affairs are now decided through this co-decision procedure. This also includes international agreements which are made in the fight against cross-border crime and terrorism. Therefore the Lisbon Treaty gave the European Parliament its first chance in history to block an international agreement on such an issue. And so it did.

The SWIFT-agreement

The history of the SWIFT-agreement goes back to 9/11, the terrorist attacks on the US. SWIFT, the abbreviation for Society of Worldwide Interbank Financial Telecommunications is the international transfer network of bank details. Its headquarter is located in Brussels and by the time of the 9/11 attacks they also had an office in the US. Shortly after these attacks the US authorities had claimed access to the database in the US in their ‘fight against terrorism’. Nevertheless the US did not inform their European allies on this action until The New York Times revealed this story in 2006. At the same time the US authorities had access to the bank details of millions of European citizens without taking account of the European legislation on privacy and data protection. To stop this illegal situation the European Commission and the US reached an agreement which made it possible for the US authorities to keep using these data. This agreement still did not take into account all the EU legislation on data protection. Shortly after this agreement was reached, SWIFT announced to transfer all their activities to Europe in 2010 and close their office in the US. A new agreement had to be reached. In order to make sure that this transfer would go smoothly, the EU member states and US came to an interim-agreement on the 30th November 2009, i.e. the last day before the Lisbon Treaty would enter into force. This interim-agreement would apply from the 1st of February 2010 until the 31st of October 2010. By taking this decision on the last day before the Lisbon Treaty would enter into force the EU member states were able to prevent the European Parliament to have a more important role in the decision-making process. This time it would only be allowed to agree or reject this interim-agreement.

The Parliament’s position

Of course this way of operating was not appreciated by the European Parliament. When the Council sent the agreement for approval to the European Parliament the rapporteur dealing with this issue, the Dutch MEP Jeanine Hennis-Plasschaert, took a reserved position. The European Parliament had a number of problems with the agreement and for the first time they would be able to show their opposition by rejecting it. Their main problem was the lack of privacy and data protection. European citizens and companies would still not have the same rights and guarantees under this interim-agreement as they would have under EU law. Besides, they argued that even without this agreement, trans-Atlantic data exchange would still be possible but only under a bilateral agreement which would take the rule of law into account.

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The sucess of the SWIFT vote

Colleagues of rapporteur Jeanine Hennis-Plasschaert congratulate her on the SWIFT vote as Parliament follows her recommendation.

Photo : Flickr, European Parliament-

Two other problems played an important role as well. The first problem was the attitude of the Council. Since the first signing of the SWIFT-agreement, the EU member states did not take the position of the European Parliament into account. For example, they made sure that they would reach an agreement before the Lisbon Treaty would enter into force. This of course troubled the Parliament and gave them an incentive to be critical about the interim-agreement.

The second problem was the position of the US. The European Parliament has always focused on civil rights and liberties. They criticised the US for fighting terrorism without taking into account the EU legislation on privacy and personal freedoms. An example of this is the secret CIA prisons which were probably also located in several EU member states. This time the European Parliament would have an opportunity to block this unrestricted cooperation between the EU and the US. Jeanine Hennis-Plasschaert, the rapporteur on this issue made this position very clear in her speech to the European Parliament : “If the US administration would propose to US Congress something equivalent to this, to transfer in bulk bank data of American citizens to a foreign power, we all know what US Congress would say, don’t we ?”.

Parliament under pressure

In the period before the voting on the SWIFT-agreement took place the European Parliament was under huge pressure. For example by the Spanish presidency. Spain was the president-country of the Council of Ministers and tried to save the agreement by putting a lot of pressure on for example the rapporteur. When contacting Jeanine Hennis-Plasschaert, they often tried to persuade her, but ultimately they always failed. Also other governments from EU member states, like the UK, contacted Jeanine Hennis-Plasschaert, in an attempt to change her position. Apart from internal pressure from EU member states, the Parliament was under heavy pressure from the US administration. A couple of days before the voting, the US Minister of Foreign Affairs, Hillary Clinton, even sent a letter to the European Parliament in which she asked to Parliament to approve the agreement. Nevertheless the European Parliament rejected the agreement with 378 votes against and 196 votes in favour. This resulted in an unusual standing ovation for the rapporteur Jeanine Hennis-Plasschaert. It were mostly the liberal and social-democrats who voted against the agreement. It would be interesting to see what the reaction of the US would have been if an EU member state would have interfered in the American politics as much as the US did in this case by putting a lot of pressure on the US Congress.

Facing reality

As expected, the US and many EU member states were not happy with this rejection. It had put the relationship between the US and the EU even further under pressure. Two weeks before the Parliament’s rejection Obama announced to skip an EU-US summit because of the confusion about the EU presidency after the Lisbon Treaty entered into force creating the new position of an EU President. This did not benefit the EU-US relationship. The rejection of this SWIFT-agreement would then even further harm this relationship. Nevertheless, both the US and the EU member states had to face reality. Therefore the EU member states made it clear that they would come to a new agreement with the US while including the restrictions of the European Parliament. This can be seen as a victory for the Parliament. In future, the Council will think twice before signing such an agreement again. And also the US authorities will have to admit the role of the European Parliament. They can no longer bypass it like they did in the past on issues of Justice and Home Affairs. They will have to accept it as an independent Parliament which has to be dealt with as any other national parliament. It is likely that this vote has strengthened the position of the European Parliament both, in the EU and externally. The exact consequences for the further relationship between the EU and the US is however difficult to predict.

Photo : Flickr, European Parliament-


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SWIFT : quand le Parlement européen se rebelle

Auteurs

Robert van Geffen

On the internet

EP President Jerzy Buzek on the rejection the SWIFT agreement
European Parliament Press Service

SWIFT: European bank data transfers must comply with European standards, say MEPs
EP Press Release

Jeanine Hennis-Plasschaert
Jeanine Hennis-Plasschaert's personal website
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