The anticipated “Defence of Democracy package”, due to be unveiled this summer, is a new initiative to advance the European Commission’s goal to nurture and protect democracy within the EU. Despite the title’s wide scope, in practise the package has as its main goal to strengthen the resilience of our democracies by defending them from foreign influence. The primary proposed initiative is a directive that will subject any entity pursuing lobbying activities and are recipients of a certain amount of funding from third countries to a number of transparency requirements. The initiative is said to be pursued in a political context which has witnessed a marked increase in cases of covert interference in our democratic sphere by countries outside the EU, with the risks further accentuated by the Russian war of aggression against Ukraine.

However, Liberties is concerned that the proposed package risks weakening rather than strengthening our democracies as the restrictive obligations it places on NGOs could amount to unnecessary and disproportionate restrictions to the right to freedom of association. In light of these concerns, Liberties took part in the Commission's "Defence of Democracy package" consultation process and sent the following submission.

Why the proposed measures risk weakening our democracies

Civil society organizations are critical to protecting the resilience of our democracies, therefore, any initiative aimed at protecting and promoting democracy needs to foster an enabling environment. However, the concrete measures envisaged to be part of the “Defence of Democracy package” are at odds with the goals of the package, because they risk having a serious negative impact on civic space.

• An unsupported assumption:
it is far-reaching to maintain that all entities, including NGOs, which pursue lobbying activities and receive funding from third countries, are potential tools for covert foreign interference. Transparency obligations, in order to be justified, should be based on real, rather than hypothetical danger.
• Vague wording:
The concept of “lobbying activities” which the Commission has referred to is overly vague. The Venice Commission considers that only a narrow category of formal and structured lobbying activities involving communication with public officials with the aim of influencing public decision-making may justify the imposition of funding transparency requirements.
• The risk of going too far:
Imposing transparency obligations on the basis of flawed assumptions and vaguely worded concepts risks creating a burden for civil society actors disproportionate to the legitimate activities they carry out. This risk is already demonstrated by the concrete application of the US Foreign Agents Registration Act, which has seen organisations receiving support from abroad in the pursuit of legitimate aims caught up in the Act’s registration obligations.
• Bad implementation, gold-plating and the chilling effect:
The margin of appreciation which EU governments will have in transposing the directive risks unintended, damaging consequences for NGOs, such as authoritarian governments introducing more restrictive measures to tarnish critical voices. Given that, in a challenging domestic funding landscape, many NGOs, especially in the field of human rights, rely on funding by foreign entities, including foundations which can be linked to foreign governments, to carry out their legitimate advocacy and campaigning work, the directive risks having a serious chilling effect on NGOs and discourage their very efforts to protect and promote democracy and the rule of law in the EU.
• Fuelling smear campaigns against civil society:
over-regulation in this sphere, in particular targeting entities, including NGOs, involved in public affairs on grounds that they receive foreign funding, risks feeding smear campaigns already used to destroy public trust in civil society. The purported measures are likely to be weaponized by authoritarian governments to fuel attacks on civil society.
• A threat to the EU’s credibility:
Given the context of the EU’s own efforts to defend the right of NGOs to seek and access funding, including foreign funding and EU funding, in the EU as abroad, the EU risks damaging its own credibility and reputation.

A rights-based approach to countering foreign interference

Alternative solutions to address the EU and its Member States’ legitimate concerns regarding covert foreign interference, which don’t unduly restrict civic space, should be considered. Liberties proposes the following recommendations:

• Impact assessment:
A fundamental rights impact assessment, ideally carried out in consultation with human rights expert bodies as well as civil society, should take place to assess whether the measures envisaged unduly restrict the freedom of association and are fit for purpose, and to consider alternative policy options.
• More targeted measures and a different framing:
Use pre-existing tools, such as strengthening the EU’s transparency register and better enforcement of existing rules on ethics of officials and MEPs. Targeted and proportionate rules on the transparency of interest representation at national level could be proposed as part of legislation aimed at facilitating the establishment and operations of not-for-profit entities across the EU, while preserving NGOs’ role and freedoms, including their freedom to seek and access funding and their freedom to conduct advocacy and campaign activities on matters of public interest.
• Investing in positive measures:
The EU should privilege positive measures aimed at strengthening the EU’s resilience to covert foreign interference over restrictive measures which carry a serious risk of negative impact on the democratic space as a whole.
• Pursuing a clear and coherent democratic agenda:
The EU should lead by example by pursuing a coherent democratic agenda to respond to existing threats both in its internal EU policy and in its external action, including by integrating objectives to be achieved through the EU’s funding and support policy.

Read the policy paper in full here.