European elections: Impact on business travel

On July 14, the new European Parliament embarks on its second plenary session and, over the four-day gathering, attempts to reach consensus on the ratification of the new president of the European Commission.

Not only will it be one of the first decisions the 751 MEPs make – or defer – it will also be one of the most important.

The European Commission president then selects his or her commissioners who, for the next five years, will determine the direction and nature of Europe's legislative programme.

To an extent, May's media frenzy surrounding the likes of UKIP leader Nigel Farage and France's Marine Le Pen rather missed the point. Compared to the all-powerful European Commission (EC), the European Parliament is relatively benign.

Immediately following the elections, the European Council – made up of the heads of government or state of the European Union member nations – sat down to dinner in Brussels to begin the process of deciding which of the political groupings' presidential candidates was mostly likely to garner cross-party support.

Names in the frame have included Christine Lagarde, the Frenchwoman in charge of the International Monetary Fund, and Ireland's taoiseach, Enda Kenny. But at the time of writing, the most likely candidate is Jean-Claude Juncker, a former prime minister of Luxembourg who is the parliament leader for the centre-right European People's Party (EPP), which has 213 parliamentary seats.

Martin Schulz, leader of the Socialists and Democrats (S&D), with 190 seats, was barely mentioned. Both the EPP and the S&D, along with the Liberals (66 seats) and the Greens (52 seats), are generally pro-Europe.

However, despite this, there were significant gains for populist, broadly anti-EU MEPs on May 22. Any pan-European legislative proposals – good or bad – are still likely to be in for a rougher ride than they would have had in the past.

Not that the going has ever been easy. In March this year, the Guild of European Business Travel Agents (GEBTA) was moved to "welcome" a European Parliament vote which excluded managed business travel from the Package Travel Directive – finally bringing to a close a debate that had lasted for at least five years.

On transport issues, the European track record has been equally chequered.

Airlines, under the aegis of the International Air Transport Association (IATA) and others, are still arguing for a reform of passenger rights legislation that governs levels of compensation for flight delays and cancellations. Again, the wrangling has been dragging on for around half a decade.

Rather more dramatically, Europe's Commission-led decision to extend its emissions trading scheme (ETS) to all airlines flying into, out of, or over European airspace caused an international outcry. The Chinese authorities instructed their airlines not to comply, while the Obama administration in the US threatened legal action, and a host of other nations threatened reprisals.

Factional in-fighting?

The make-up of the new European Parliament seems unlikely to make matters better – or worse – but there are concerns that, with the increased number of factions within the governing body, the legislative process could become more cumbersome.

Julia Anna Eckert, at German travel management association Verband Deutsches Reisemanagemnt (VDR), says: "We think the legislative process could slow [and that could have an impact on] the business travel items, probably in air passenger rights, emissions trading, the Single European Sky, data security, and the regulation of the multilateral interchange fee."

Benoit Chantoin, legal advisor both to GEBTA and to ECTAA, the group of national travel agents' and tour operators' associations within the EU, is less sure. "It is unlikely that the new Eurosceptic members of the European Parliament will have an important impact on the daily work, or will slow down the legislative process, for two reasons," he says.

"First, the Eurosceptic parties will be divided into two or three political groups – the ECR [European Conservatives and Reformists], originally created by the British Tories; the EFD [Europe of Freedom and Democracy], including UKIP; and the new Far Right of the French National Front and the Dutch PVV – thus limiting their influence. Despite their growing number, the fact that Eurosceptics are split will limit their influence on the two big political groups – the S&D socialists, and the centre-right EPP."

Chantoin's second reason is that Eurosceptic factions – namely the EFD and the new Far Right party – have not worked or participated actively in the legislative process in past years, "and it's unlikely that they will start to work now".

Given that there are now many more groupings within the European Parliament, will lobbying become more difficult? "One important lesson we can take from the results of the elections is that the centre-right parties of the EPP, despite winning the elections, suffered the biggest loss in seats – 61," says Chantoin. "The EPP has now only 23 seats more than the Socialist and Democrats group, the S&D. Therefore, without saying lobbying will be 'more difficult', the balance of power in this new parliament might change the way dossiers are tackled, with more negotiations, and more consumer-friendly and important dossiers attributed to the socialists."

Nevertheless, for GEBTA, lobbying activity remains important and requires a continuous monitoring of European affairs in order to ensure that the specific needs of business travel are taken into account.

The biggest challenge is that many of the legislative proposals are drafted with leisure travellers in mind, often with little regard for – or understanding of – the difference between managed and discretionary travel.

The new European Parliament seems unlikely to change that, but the new European Commission just might. To a considerable degree, that will depend on the new Commission president – and his commissioners, who draft those proposals. These commissioners are chosen in agreement with the European Council's heads of state, who are still reeling from the electoral Eurosceptic backlash – and may well want to see evidence of change.

The key issues for the European travel associations

In the current revision of the Travel Package Directive 90/314/EEC, the European Parliament is being asked to ensure that this legislation remains targeted to protect consumers without impacting business travellers.

The revision of air passenger rights legislation should prohibit airlines from turning away passengers who have not used all segments of their tickets.

The continued exclusion of travel insurance from the Insurance Mediation Directive, now being revised. Inclusion would result in travel intermediaries refusing to offer travel insurance, to the detriment of the travellers.  

In 2012, an estimated 6.6 million potential travellers from six target markets were deterred from visiting Europe because of the Schengen area visa regime. Europe needs to simplify visa application procedures, in particular for frequent travellers, such as business travellers.

In the lobby…

There are currently around 6,500 'interest representatives' – lobbyist organisations – on the EU Transparency Register. Lobby groups do not have to sign up to the register, but if they do, the implication is they are more likely to be heard.

Of those registered, more than 2,000 are trade, business or professional associations, including UK travel trade association ABTA, the Global Business Travel Association (GBTA) and the Guild of European Business Travel Agents (GEBTA), the latter representing the interests of Britain's Guild of Travel Management Companies (GTMC).

Think-tank Civitas – the Institute for the Study of Civil Society – says most pressure groups target their lobbying at the European Commission and the European Parliament.

"The Council of Ministers and the European Council are not lobbied as much," the group explains, "as it is more effective to target individual governments and ministers at the national level.

"The Commission welcomes input from pressure groups as a channel of representation of civil society, and regularly engages in consultation with them.

"The European Parliament is less likely to consult pressure groups when making decisions, as it sees itself and national parliaments as the most effective channels of representation for EU citizens.