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Issue #36

Issue #36

Guten Morgen!

If you haven’t done so yet, make sure to sign up for our upcoming 1-5-30 TALK with MEP David McAllister happening next week on Wednesday, February 17th! Only a few spots left, so don’t miss your chance and sign up here.  Hope to see you there! Otherwise, happy reading and have a great start to your weekend with our latest Krautshell edition.

Enjoy and ping us for more!


Anna                                Christian


The Ongoing Battle over ePrivacy: The Portuguese Compromise

This past week, the European governments finally agreed to a framework for new privacy rules, specifically governing how service providers are allowed to process online communications data. Hence the name, the ePrivacy regulation. This is sort of a big deal, as this bill has been hotly debated since its introduction in January 2017. The best way we can explain the multi-year discussion: ongoing disagreement over the tradeoff between innovation and privacy. France, advocating for innovation, wanted less privacy protection both to help businesses grow through data use and give itself more surveillance powers in the fight against crime and terrorism. Germany, being the ever-privacy-conscious nation it is, repeatedly rejected proposals because it felt users were not sufficiently protected.

So, what’s in this compromise brokered by the Portuguese Presidency? For one, electronic communications network- or -service providers are authorized to process metadata in certain use cases like if data-processing protects users’ vital interests. Second, information from users’ terminal equipment (like your smartphone) may be used for information collection and -processing either with the user’s consent or for “other specific transparent purposes.” Hm. Finally, websites will be officially allowed to restrict access to their platform dependent on consent to use of cookies, given that the website provides an equivalent offer that does not involve consenting to cookies. However, this probably will not be the last time you hear about this debate, as it now will be discussed in the European Parliament, where disagreements are all but certain. If you fancy some light (87 page) reading, the full proposal can be found here.

Knights of the Corona Round Table

This week was once again time for new Corona decisions and Chancellor Angela Merkel met with the Head of States to discuss when to (not) restart public life. Our relatively strict protection measures are prolonged (again) until March 7th. Remember: we started with the “Lockdown light” in November in order to be safe at Christmas…

At least, hairdressers will re-open on March 1st. Certain colleagues of this article’s editor can confirm the necessity of this measure #badhairday. What is more controversial than hairdressers is the target value for the incidence rate per 100,000 people needed to re-open safely. Over the last months, “50” was the magic number, the piece of hope in all the misery. Now, as some regions are nearing 50, the federal and states government are like: “Yeah, well, good job but actually we need 35. We’re sorry!” Badly communicated, but legitimate background: The mutants of the Coronavirus have reached Germany and so far, we know little about them besides that they are more infectious. Meaning, we will be in lockdown at least for another 25 days. Hurray!

Borrell Hung out to Dry as Russia-EU Relations Continue to Deteriorate

In early February, the Russian government sentenced opposition leader Alexei Navalny to two years and eight months in prison upon his return to Russia after a poison-induced coma. Unsurprisingly, the EU did not take his imprisonment too well. You know, rule of law and freedom of speech and all that jazz. Russo-EU relations have been in a rapid free fall since then, but the EU’s chief diplomat, Josep Borrell, insisted on stepping in to try and remedy the situation through some good-old-fashioned diplomacy.

Borrell made the trip to Moscow last week to meet with his Russian counterpart, Sergei Lavrov, to “test whether the Russian authorities are interested in a serious attempt to reverse the deterioration of our relations.“ Surprise: they weren’t. During his trip Borrell was hit with a one-two punch; in a press conference, Lavrov accused EU politicians of lying about Navalny’s poisoning and then called the EU an “unreliable partner,” and Borrell said nothing. Later, he found out FROM TWITTER that Russia had expelled three EU diplomats for attending pro-Navalny demonstrations. Let’s just say Russia: 2, Borrell: 0. In fact, Borrell’s performance was so poor, over 70 MEPs have signed a draft letter calling for his resignation. However, it may be the EU that gets the last laugh, as there are new sanctions in the pipeline to be discussed on February 22nd. Russia has since said it is prepared to cut ties with the EU if new sanctions are imposed. We’ll be sure to give you more updates as the situation continues to unfold.

(Hopefully Not) Waiting for Godot

Like the US military, the Federal Armed Forces of Germany are engaged in Afghanistan. When former President Trump announced US troop withdrawal from the region, German politicians were in a panic. Now, Germany is unsure whether to stay or to leave and somehow hopes that help will come from the Biden administration. The insecurity comes from the fact that the mandate for the German deployment ends on March 31st and would have to be renewed by the German parliament (deployment is within the power of the parliament, which is why Germany’s forces are often referred to as a “parliament army”). Which options are on the table?

Foreign Minister Heiko Maas (SPD) is allegedly in close contact with Antony Blinken, who assured him that the US has a high interest in cooperating (“in together, out together” – we love that). But, as we probably don’t need to tell you, Biden’s administration is reviewing the state of negotiations between the Trump admin and the Taliban, which might take a while. Germany will most likely prolong the deployment until December 31st, giving the US and the new Federal Government, who will be in office by then, flexibility to prolong again or withdraw completely. This might not be the biggest challenge in transatlantic cooperation but it sure is a first stress test for NATO and Germany with the new US administration.

Finally, a Supply Chain Law

The law for the protection of human rights in supply chains was probably one of the most complicated topics for the current government coalition. Already in 2016, it was clear the issue had to be tackled. Now, it is 2021 and the law has passed the cabinet and will enter into force in 2023. Days like these we can understand why people complain about politics taking “too long.” Shortly before Christmas, we already told you the conflict centers around placing additional burden on companies during the pandemic and deciding when to officially ban child labor along the entirety of German companies’ supply chains. (Seems like the answer here is pretty clear).

The Federal Economics Minister Peter Altmaier (CDU) assured some mitigation of liability rules for companies (as this is of course his job) while Federal Development Minister Müller (CSU) and Federal Labor Minister Heil (SPD) assured that Altmaier won’t mitigate too much. What is critical now are parliamentary discussions. It is conceivable that there will be significant parts of the SPD that don’t think this law goes far enough. And they are likely to be backed by opposition parties like the Greens or the Left. So far, it is not guaranteed the law will come into effect in the way it was passed by the cabinet.

EU Recovery and Resilience Facility: Unimpressive German Plans

This week, the EU Parliament approved the Commission’s proposed €750 billion Next Generation EU Recovery package, along with its €672.5 billion Recovery and Resilience Facility (RRF) in grants and loans. Member States are meant to not only rebuild their economies with these funds, but also grow them by driving Europe’s green and digital transitions. Member States are free to decide how they invest their portion of the RRF, except a minimum of 37 percent of money must go towards projects that positively contribute to climate and environmental protection, and at least another 20 percent must go towards measures with a digital component.

And everyone was rightfully excited, that is until the Wuppertal Institut and E3G released a Green Recovery Tracker Report, detailing exactly how unambitious German draft recovery plans currently are. First, Germany is not planning on starting many new projects: compared to plans financed by the domestic recovery package, the RRF only increases overall green spending by one percent – bringing the total to 22 percent. This means Germany is now failing to meet the environmental demands it so vehemently insisted on during negotiations. Also troubling: the government is still supporting (environmentally) counterproductive measures like financing plug-in hybrid vehicles and trucks with internal combustion engines. For a government that constantly talks about the absolute necessity of a green and digital economy, you can’t help but feel a bit disappointed.


  • It’s Comeback Time: We’ve reported about the Italian government crisis a few times now. The solution seems to be an old acquaintance: Mario Draghi, former President of the European Central Bank. It seems like Europe’s former highest banker has enough support in the biggest Italian party and will lead the new government. Certainly, Italy would then have a Head of Government that is well respected throughout the EU.
  • Baby, You Can Drive My Car: The draft for a law for autonomous driving, which reported two weeks ago, passed the in the cabinet this week and Federal Transport Minister Scheuer (CSU) couldn’t be happier. Which means we might have autonomous buses bringing people from point A to point B and some other cool stuff quite soon. Ping us if you’re interested to know what will and won’t be allowed.
  • Let’s Set Up A Company: In the future, founding a “GmbH” (German pendant of a “Ltd.”) in Germany will be possible online. There won’t be the need to visit a notary anymore. Germany aims to finally digitize parts of its administration and we are curious how long it will take the law to become reality.


By Anna, Senior Consultant


You might have seen the vaccination statistic showing Israel leading the world with an uncatchable almost 70 percent of its population vaccinated. Germany is very much at the bottom in that list with 4.6 percent. LESS-THAN-FIVE-PERCENT.*

Since that is not going so well, and the Covid-numbers are declining, but not enough, Chancellor Merkel and the Prime Ministers, in a rare bout of unity, decided to extend the current lockdown until March 7th for shops, schools, restaurants, and of course, tennis.

Guess who‘s exempt? Yup, hairdressers.

Apparently, and this was news to me, hairdressers seem to be of “systemic relevance.” At least until last week, this was the explanation for why some businesses were allowed to keep operating. You know, grocery stores, pharmacies, chiropractors. That kind of stuff. And I don’t feel qualified to assess the general importance of hairdressers to society (and I am very much looking forward to an appointment btw), but how they are more important than schools, shops or the possibility to exercise (on a tennis court for example!) is beyond my understanding.

Honi soit qui mal y pense, but I can’t help thinking that maybe the rapidly growing black market for haircuts and/ or the necessity of occasional TV appearances played a bigger role in that decision…

*Financial Times Covid-19 Vaccine Tracker

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