Oireachtas Joint and Select Committees

Thursday, 15 July 2021

Joint Oireachtas Committee on European Union Affairs

Developments at European Union Level: Commissioner Mairead McGuinness

Ms Mairead McGuinness:

I thank the Deputy for his questions. I will try to deal with them in the order in which they were asked.

The Deputy takes a particular interest in sanctions, an important issue. What happened with the Ryanair flight shocked us and perhaps brought to global attention what is happening in Belarus, and no harm that it does. My role in sanctions is threefold. I oversee their drafting, guide their implementation and monitor them to make sure they are fully implemented by member states.

On Belarus, the Deputy saw what happened. There was quite a strong reaction and unanimity at EU level that this was an issue that had to be tackled and addressed. The sanctions were adopted in record time. On 4 June, the EU adopted a ban on aircraft flying over the airspace. On 21 June, we adopted the additional designations and the Deputy mentioned the people and entities involved.

On his question on the impact of sanctions, I would not be able to say they are having a specific impact, but I think they are. I daresay the Belarusian authorities will not tell us how severe the impact is, but we are carefully monitoring the situation.

The shock of what happened has catapulted concerns around what is happening in the region. The whole idea of sanctions is a difficult area of policy. They target those who are up to no good. In some ways, this is a sensitive issue. We have to try to avoid impacting those who are not part of the problem. The humanitarian side of sanction implementation is something we have to be very mindful of, but it is fair to say the immediate response, the unanimity around that response and the targeting of citizens and entities was real and strong. The Council will consider this again and, if needs be, examine whether to impose more sanctions on the regime until it realises democracy matters and countries cannot interfere in flights that citizens are on without getting some reaction to that.

On the rule of law, the Deputy asked whether there is real commitment, and I will answer that very strongly. I am sure he has listened to the President of the Commission speaking about rule of law issues, Hungary and recent events. She leads us in our total commitment to making sure the rule of law and values are respected and we use whatever instruments we can to insist this happens. I want to be very clear on that.

I understand what one leader said about Hungary. The Council meeting was particularly emotional, and rightly so, because what Hungary was and is doing is completely against the rights of individuals and the things we hold dear. We have to do whatever we can to make sure any member state that does that, in particular Hungary, is aware this is not acceptable.

The Deputy asked specifically whether there is a link with the recovery plan. I cannot give him a definitive answer. It may well be the plan is still going through the scrutiny process because, as he knows, some plans were submitted early and approved while others remain to be approved. If I have more clarity, I can reply to him separately on that.

The real sanction comes through money. We have to use all the tools available to us to insist members of the European Union abide by the customs, laws and values of the union. Members cannot pick and choose or discriminate. The European Union, for all its difficulties over time, has been strong on our freedoms, including freedom to move and freedom of speech. Non-discrimination is a core element of our values. Whatever we need to do to make sure countries comply with that will be done.

The hand grenade remark is worrying. Let us stand back from the discussion around tax. Ireland feels in a particular position but I take a different view and took such a view in the European Parliament. The world is changing on two fronts. First, citizens are wondering whether big companies pay a fair share of tax. The sense is they do not because they can avoid paying a fair share. Second, digitalisation means things are more mobile. Where countries are located may be different from the markets they serve. The European Union fully supports the work of the OECD. There is a view it has been more rapid than might have been the case had there not been a different Administration in the United States. The Biden Administration has been to the fore in trying to have this global agreement.

Regarding the details, my colleague, Paolo Gentiloni, a happy Italian this week for reasons we all know, is deeply involved in all this. He would like to see the European Union collectively agree to what the OECD is working towards. There are three members states concerned, namely, the member state I know best, Estonia and Hungary. I am reading various reports and have listened to the Minister for Finance, Deputy Donohoe, discuss this. It is not clear yet whether these details will get through the US Congress and what the details are. While the European Union would have to move as one rather than as some, there is an opening to address some of the concerns of those who have not signed up to the agreement yet.

It is significant that there is now a realisation that those big earning companies have a requirement to pay tax at a certain level and that it is apportioned to where the services are delivered. That has consequences for the member state I know best and I have been reading about those. A wider discussion may be required about peripheral countries' economic model for the future.

I have listened to commentary about undue pressure being put on Ireland. I do not see that as the case. There is an understanding of Ireland's perspective but also a hope and expectation Ireland will join with the rest of the European Union if a global agreement comes into play. We should all hope it does. If it does not, it shows multilateralism has not worked. With the Biden Administration back around the table on many issues, including finance and climate, there is a hope that multilateralism is back in vogue. We will not solve any of our problems without that. While it is a concern in Ireland, at the broader level the European Union is keen that there be a global agreement.