Banks declare massive increase in EU lobbying

Banks and internet giant Google are among firms to declare huge increases in spending on EU lobbying as tougher transparency rules enter into life.

JP Morgan Chase says its lobbying costs in Brussels went up from €50,000 in 2013 to between €1,250,000 and €1,499,999 in 2014 - a 30-fold increase.

Goldman Sachs says its figures rose from €50,000 to between €700,000 and €799,999 in 2014 in the same period - a 14-fold hike.

UBS’ costs climbed from between €200,000 and €250,000 to €1.7 million - a seven-fold increase.

Costs for Barclays, HSBC and Royal Bank of Scotland more than tripled, while costs for Banco Santander, BNP Paribas, Deutsche Bank, Danske Bank, and Raifeissen doubled.

Several financial sector trade associations also posted huge hikes, including: the European Fund and Asset Management Association; International Swaps and Derivatives Association; European Private Equity and Venture Capital Association; and the Federation Banquaire Francaise.

The increases were posted in the European Commission’s transparency register in the run-up to Monday’s (27 April) deadline on more stringent reporting requirements.

The register remains voluntary, but, from last October, firms which stay out are blocked from meeting with EU commissioners or staff in their cabinets.

At the same time, commissioners and cabinet staff must, since January, publish details of meetings with interest groups, making it harder for non-registrants to slip under the radar.

Banks weren’t the only companies to post significant hikes in spending.

Internet giant Google says it spent up to €4 million last year compared to €1.5 million in 2013. Energy firm BP and furniture outlet Ikea doubled spending to €3 million and €900,000, respectively. Sony Europe said spending went from €50,000 to €600,000. Ebay’s figures climbed from €100,000 to €500,000.

Compliance with the new rules remains patchy, however.

The commission said that all firms which miss Monday’s deadline will be struck off the register.

Prior to the deadline it had 8,503 registrants. But on Wednesday the figure dropped to 6,912, meaning almost 1,600 companies have come off it.

The commission now says it will give them a grace period of up to two weeks to file data and to get back on.

Some companies who no longer have a valid entry include: GDF Suez; Lloyds Banking Group; G4S; Bank of America; and the Tobacco Vapor Electronic Cigarette Association.

Several firms posted figures dating to 2013 instead of 2014 by way of compliance on giving “latest available” data. Others posted figures which appear to make little sense just in order to meet the deadline or because they hit the wrong key on their computer.

US and Chinese engineering giants GE and Huawei couldn’t find 2014 information and posted 2013 figures instead.

IT firm Microelectronica, pharmaceuticals company Pfizer, and energy firms SNC Lavalin and Socar, for instance, all posted figures of more than €1 million for the previous reporting period, but suddenly declared less than €10,000.

For its part, Corporate Europe Observatory, a Brussels-based pro-transparency NGO, noted in a statement that it is normal that banking sector costs went up in recent years due to the higher amount of post-crisis EU financial regulation.

But they noted that Goldman Sachs tiny initial declaration of just €50,000, for instance, looks like deliberate “under-reporting”.

Meanwhile, the think tank’s Erik Wesselius told EUobserver the anomalies are due to the fact “it is still very easy to make factor 10 or even factor 1,000 mistakes in declaring lobby costs” due to the register’s templates.

The banking firms under scrutiny and the commission officials responsible for the register couldn’t be reached for comment on Tuesday.

Lobbying firms

In terms of specialised lobbying firms, the latest declarations indicate that Fleishman-Hillard (€6.5mn) is the largest in the EU capital.

The next biggest is Hill & Knowlton (€5mn), followed by G Plus (€3.25mn), Cabinet DN (€3mn), Weber Shandwick (€2.75mn), Grayling (€2.5mn), Rohde (€2.25mn), FTI Consulting (€2mn), Fipra International (€2mn), Brunswick (€1.25mn),

But the consultancy firms’ declarations also contain anomalies.

Some of the largest in the sector - Burson-Marsteller, Apco, Kreab Gavin Anderson, Hume Brophy, and Edelman - which also posted multi-million figures in the previous period all posted less than €10,000 each.

Fleishman-Hillard’s declared lobbying spending was €6.5 million last year, down from €11.5 million in 2013.

Tobacco

With bank spending on the up, tobacco declarations are on the way down, after the EU wrapped up work on new regulations in early 2014.

Philip Morris, for instance, filed €1.5 million for last year compared to €5.2 million the year before.

The sector is far from being out of business, however. Total spending by Philip Morris, Japan Tobacco, Imperial Tobacco, and Swedish Match amounted to €2.8 million last year.

A trade body, the European Smoking Tobacco Association, declared a further €0.5 million.