European Commission cracks down on revolving door of law firm jobs

Brussels is clamping down on EU officials working for private-sector firms while on leave from the European Commission as it seeks to address a revolving door that allows people to move between the institution and law firms and consultancies.

Staffers seeking to take lengthy unpaid absence are increasingly being told they will no longer be permitted to represent private companies against the interests of the commission.

The new regime is an attempt to restrict conflicts of interest that sometimes spring up when staffers avail themselves of a commission scheme permitting them to go on unpaid leave for up to 12 years and work elsewhere, while keeping a position open back in the EU.

The restrictions apply across the commission and its staff of over 32,000, but they have particular relevance in departments including competition, financial services, energy and the legal service, according to people familiar with the policies.

The commission has faced growing criticism from the European Parliament and elsewhere over its revolving door with the private sector. This year the European ombudsman, Emily O’Reilly, warned that EU institutions were at a “critical point” in handling people moving between EU jobs and private companies, and that failure to control the practice could erode public confidence.

The commission started tightening its approach in July last year and since then some of those already on leave have been refused permission to renew their absence and given a deadline to decide whether to return.

In some cases, officials have contested the decision and some have considered legal action because they believe the policy is unfair, according to three people familiar with the situation. Nearly all of those asked to return to the commission handed in their resignation, people familiar with the matter said.

The commission’s decision to toughen up its approach reflects concerns that former officials working in private practice sometimes end up becoming involved in cases where their client’s interests diverge from those of the EU.

There has been particular scrutiny of movements of staff from the EU’s competition division to law firms.

Carles Esteva Mosso, currently a partner at Latham, left the commission in April 2021 and started his role in June the same year. Cecilio Madero retired in May 2021 and then joined Clifford Chance, although he has since left his post, which he only held briefly.

A few months later, Nick Banasevic, another senior official involved in cases against Google and Microsoft, left the EU to join Gibson Dunn. None of these people were on leave of absence from the commission and the ombudsman found no wrongdoing in the way their departures were handled. All three declined to comment.

Opponents of the EU’s tougher policy argue it is short-sighted and will deprive officials of real-world experience in the private sector that can be beneficial when they return to their commission jobs.

They say it will deter high-calibre people from joining the commission in the first place, at a time when millennials expect to have multiple jobs at different places throughout their careers.

In the EU’s competition unit, employees currently on leave were sent a letter earlier this year requiring them to make a decision to return or leave the EU for good. One person said they toyed with the idea of suing the commission but in the end decided not to invest resources in what was likely to be a lengthy process.

“It is absurd as a policy. It is a clear abuse of power. They would lose ten times in court,” the person said.

“The European Commission is taking this to the limit,” said another person on unpaid leave and who received the letter.

However, the EU argued there was no “legitimate expectation” that a leave of absence would be renewed for up to 12 years and that it has been applying the policy in a proper and proportionate manner, people who received the letter said.

A spokesperson for the commission said: “The commission in principle forbids, during leave on personal grounds, outside activities the aim of which is to represent private interests before the commission, notably when undertaken by law firms, consultancies and public affairs departments of organisations.

“This is all the more relevant if the envisaged activity takes place in the same area of expertise as the one in which the staff member works at the commission or where the commission acts as an enforcer or regulator in the field.

“Please note that this is a longstanding policy over the years, well before the ombudsman’s report on revolving doors, as also acknowledged in the decision of the ombudsman.”

The investigation in May by the EU’s ombudsman on revolving doors concluded that Brussels “risks undermining the integrity of the EU administration without a more robust approach to the movement of staff to the private sector”.

The report called on the commission to ban jobs that pose risks “that cannot be offset by restrictions or if restrictions cannot credibly be monitored and enforced”.

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