AS (2016) CR 11
2016 ORDINARY SESSION
Monday 18 April 2016 at 3.00 p.m.
In this report:
1. Speeches in English are reported in full.
2. Speeches in other languages are reported using the interpretation and are marked with an asterisk.
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The contents page for this sitting is given at the end of the report.
(Mr Agramunt, President of the Assembly, took the Chair at 3.05 p.m.)
The PRESIDENT – The sitting is open.
1. Annual Activity Report 2015 by the Council of Europe Commissioner for Human Rights
The PRESIDENT – The first item on the agenda is the presentation of the Annual Activity Report 2015 by Mr Nils Muižnieks, Council of Europe Commissioner for Human Rights (CommDH(2016)7).
It is a great pleasure to welcome you, dear Commissioner, to this Chamber, which you know very well. Your regular participation in our debates and committee meetings is highly valued by members of the Assembly. Your insights and recommendations often serve as guidelines in the preparation of our missions and reports. We look forward to learning more about your activities and to having an exchange of views with you on the main threats and challenges to human rights across our continent.
Mr MUIŽNIEKS (Council of Europe Commissioner for Human Rights) – It is a great pleasure and honour to be here to present my fourth annual report. 2015 was a year of fear and insecurity in Europe. It was a difficult context in which to deal with human rights work, but one in which human rights were needed more than ever. Fear and insecurity were linked first and foremost with the issue of migration. The situation was quite dramatic in many places in Europe. For example, 500 000 people arrived on the small island of Lesbos in 2015; thousands of people are stranded in awful conditions in the western Balkans; and last year Turkey became the country hosting the most refugees in the entire world.
On the other hand, many member States are enacting policies that threaten the human rights of those in need of protection. They are building fences, criminalising irregular entry, detaining vulnerable people and placing daily caps on arrivals or quotas for granting status. Many member States are enacting misguided policies in an attempt to make themselves less attractive to migrants; they are reducing benefits, seizing assets, restricting the right to family reunification or giving only temporary forms of status. I fear that that will make integration all the more difficult in the future and will not have a significant impact on the flows of people, which are driven far more by push factors – wars and failed States – than pull factors.
What have I done on this issue? Migration, asylum and refugees were either one area of focus, or the sole area of focus, in a number of different country visits last year to Belgium, Bulgaria, Cyprus, Germany, Hungary and Spain. I intervened as a third party in several cases before the European Court of Human Rights on migration-related cases regarding alleged pushbacks from Spain to Morocco and Dublin returns from Austria to Hungary. I did a whole lot of communications work surrounding migration and human rights; we wrote four opinion editorials and four human rights comments, and organised two social media campaigns. I gave a number of lectures, and soon we will be issuing guidance for member States on integration policy. I will continue to try to help governments to forge more human rights-compliant policies, to support human rights defenders and national human rights structures, and to raise awareness about the human rights issues at stake, and I need your help: I need the help of parliamentarians to spread the human rights message and search for co-operative solutions.
A second cause of fear and instability throughout Europe was terrorism. Several member States faced threats and attacks, and many saw the return of foreign terrorist fighters. Member States have the right and the duty to protect the right to life by combating terrorism, but they must do so while upholding the rule of law and human rights. I sought to participate in debates on counter-terrorism and human rights in a number of countries, for example in France. I have just returned from visits to Turkey and Ukraine, where I raised the issue of upholding human rights in the context of counter-terrorism. The instinctive response of many States is to act quickly, to restrict rights and to give more powers to security services. I have urged States to go slowly, and to consult their human rights experts and structures to ensure the compatibility of their legislation with human rights obligations. I say this to member States: it is legitimate for them to give more powers to their security services and to give more resources, but I urge them to enhance democratic oversight of those security services. To provide guidance, I published an issue paper on standards and best practices across Europe.
Human rights defenders are a critical part of my mandate, and the situation for them deteriorated in several member States. The space for civil society shrank last year and continues to shrink today. One of the most difficult contexts in which I have to work is Azerbaijan, where the crackdown on human rights defenders and journalists has affected many defence lawyers. A number of people were recently pardoned, and some had their sentences converted to suspended sentences, but all those who have been detained or prosecuted because of the views they have expressed should be released, granted compensation and allowed to continue their work in freedom. That applies particularly to Ilgar Mammadov and Khadija Ismayilova.
My response to the situation in Azerbaijan was to intervene as a third party in six different cases before the European Court of Human Rights from Azerbaijan to highlight the fact that they are not individual cases, but reflective of a systemic problem. I wrote a number of different opinion editorials on Azerbaijan, sometimes by myself and sometimes in collaboration with representatives of other international human rights organisations.
Another difficult context in which I have to work is Russia, where legislation and policies led to many human rights non-governmental organisations suspending their work. I published an update of an opinion on the foreign agent law in July, looking at its implementation in domestic courts in Russia. I sought to go to Russia several times during the past year, but it was not possible. The Russian authorities were unavailable to meet me and did not facilitate my work within Russia. As a result, I organised two days of meetings with Russian human rights defenders at the end of last year in Strasbourg. This year, I intervened as a third party in the case of well-known Russian human rights defender Natalya Estemirova, who was killed in the North Caucasus in 2009.
Last summer, we organised a human rights defenders round table for defenders of women’s rights and gender equality. I was interested to learn that women face pressures everywhere throughout Europe – north, south, east and west – especially those who deal with domestic violence and reproductive health issues. The issue of gender equality has become increasingly prominent on my agenda, both in my country work and in my thematic work. I intend to continue to pay a lot of attention to it in the coming two years.
Another important area of my work is media freedom and the safety of journalists. The situation over the past year has been especially difficult in Crimea for those trying to cover the conflict in eastern Ukraine, and difficult for many in Turkey – many of the journalists I recently met in Turkey face huge pressures. In the broader Council of Europe landscape, what we have that is new is a platform for the protection of journalists. I co-operate actively with that platform and have intervened in a number of cases that were brought to its attention. Media freedom was a focus in a number of my country visits last year, including in Bulgaria, Serbia and San Marino. I wrote a number of opinion editorials and made conference presentations, trying to highlight the risks to investigative journalism inherent in mass surveillance.
Finally, I should mention the good co-operation I have had with the Parliamentary Assembly of the Council of Europe and the national Parliamentary Assembly of the Council of Europe delegations. Over the past year, I participated in a number of events and side events here in Strasbourg. I also met a number of Parliamentary Assembly of the Council of Europe members during country visits. I found those meetings to be very useful and important, not only to gather new information on countries, but to learn about new legislative initiatives and to discuss my country findings. In 2015, I met members of the Parliamentary Assembly of the Council of Europe from Spain, Italy and France during sessions here in Strasbourg, but I met delegations during country visits in Norway, Bulgaria, Germany, San Marino and Hungary.
I look forward to continuing that co-operation, and will be very happy to address any questions and further human rights issues of interest.
The PRESIDENT – Commissioner, thank you once again for taking the time to share with us an overview of your activities and concerns. Let me assure you that you can continue to count on the full support of the Assembly. Members of the Assembly have questions to put to you. I remind them that questions must be limited to 30 seconds; colleagues should ask questions and not make speeches.
The first question is from Mr Korodi.
Mr KORODI (Romania, Spokesperson of the Group of the European People’s Party) – Commissioner, you have summarised a year of complex activity. From our political group, I want to put to you the important questions that need to be developed this year. First, there is a question of balance about security and human rights. When member States use security procedures in a proper manner, they can achieve good results that are not detrimental to human rights.
Secondly, on human rights and minority rights, you need to focus not only on Georgia and the Roma question, but follow the situation of all traditional ethnic minority communities in member States. The situation of those communities is getting worse. In a tense European situation, we should first address minority groups.
Mr MUIŽNIEKS – I examined the situation of minority groups in a number of different contexts over the past year. First and foremost, I looked at the situation of Roma, but I have also looked at other minorities. One interesting feature that deserves our attention is the impact of the migration crisis on traditional majority/minority relations. Some of the fragile countries in the western Balkans have patterns of inter-ethnic relations; they were settling relations in the past 10 or 15 years, but are now being disrupted by those new influxes. The political forces that are against migration also tend to be against traditional minorities, so there is a spiral of intolerance. Minorities are the first to suffer as a result.
I am trying to give that issue the attention it deserves. I had an excellent exchange of views with the Advisory Committee on the Framework Convention. I am in close touch with the Organization for Security and Cooperation in Europe (OSCE) High Commissioner on National Minorities. It is very much on my agenda.
Ms STRIK (Netherlands, Spokesperson of the Socialist Group) – I thank the Commissioner for all his work for refugees. He mentioned the worrying tendency of States to deny, complicate or even suspend family reunification for years, which leaves women and children stuck in unsafe conditions and increases the number of unaccompanied minors who are vulnerable to exploitation. How does that relate to Article 8 of our convention, and what can you and we do to ensure that family reunification is speeded up, and that a wider definition of “family” is used? After all, integration can start only when the whole family is safe and united.
Mr MUIŽNIEKS – There is European Court of Human Rights case law on the right to family life, but we also have significant case law, which is often neglected, under the social charter. I regard family reunification as linked not only to migration but to integration, as you said. Family reunification is one way of putting some kind of order into the disorderly, chaotic flow of people into Europe, whereby often one member of the family arrives and the rest of the family remains somewhere else. Clearly, those people will try to join the member of their family in safety. Why not facilitate this rather than try to prevent it? It is one way in which to have some kind of order and balance in migration processes.
The matter is clearly linked to the success of integration. How can we expect people to integrate if they do not know the fate of their spouse or their children? It is their No. 1 priority. I have looked at the issue in several different contexts when considering migration and refugee policy. We will put out guidance on family reunification because it will be one of the biggest issues on the migration agenda in the coming years. According to the model of our previous issue papers, the guidance will look at case law and best practice. As I said in my opening remarks, I fear that we are going in the wrong direction in several places. We are restricting the right to family reunification in the interests of keeping the numbers down. However, that will harm the efforts to put some kind of order into the flow of people, which cannot be stopped, only managed. It will also harm our efforts to promote the integration of those who have already arrived.
Ms ZELIENKOVÁ (Czech Republic, Spokesperson for the Alliance of Liberals and Democrats for Europe) – I would like first to thank you for your great work and the particular effort that you into Ukraine and the crisis that we currently face. I want to ask about Nadia Savchenko. Have you taken, or will you take, any steps to help save her life?
Mr MUIŽNIEKS – During my last visit to Russia in September 2014, I raised not only the Savchenko case, but several others of Ukrainians held in detention in the Russian Federation. My view is that everyone who has been detained in the conflict in eastern Ukraine should be dealt with in the context of the Minsk negotiations. All those from Crimea who were detained, and especially those, such as Ahtem Chiygoz, who were arrested after the political changes for alleged transgressions before the changes, should be released. Should it be possible to continue my country work in Russia in the coming year, I intend to put those issues on my agenda. I have received some signals that give me hope that, perhaps after the elections, I might be able to go to Russia again, but it has not been possible in the last year and a half.
Mr PRITCHARD (United Kingdom, Spokesperson for the European Conservatives Group) – Commissioner, I thank you for your report and your visit to the United Kingdom. My question follows on from the previous question. Notwithstanding page 14 of your report mentioning Ukraine, there is no reference to Nadia Savchenko there. I understand that you have raised other cases. In your oral statement, you did not mention her name. It is not a criticism but an observation. Given her hunger strike and the conditions in which she is being kept, what more can you do urgently, rather than waiting for a possible second visit to Russia, when you may not be able to meet everyone you need to?
Mr MUIŽNIEKS – Urgently, I do not think that there is a lot I can do. The issue has been raised by the Parliamentary Assembly of the Council of Europe and the Committee of Ministers. I have tried to raise it behind the scenes. My mandate is relatively clear on human rights defenders: I should care for, meet and deal with them, and I have tried to do that in several different contexts. Otherwise, my mandate says that I should not take up individual complaints. Is Nadia Savchenko a human rights defender? I do not know, but it is clear that the case requires the attention of us all and I hope that she and others in her situation will be released and exchanged soon. What can I do? I can raise the case with the Russian authorities I meet. Words are my tools. Dialogue is my tool. If I cannot go to a country, my toolbox is not being fully used. My hope and intention is to go back to Russia to raise these and other human rights issues with colleagues, partners and interlocutors in the Russian Federation. As I said, that has not been possible in the last year and a half.
Ms KATRIVANOU (Greece, Spokesperson for Group of the Unified European Left) – Thank you for all your work and thank you for answering our questions. What do you think about the European Union-Turkey deal? Does it comply with the European Convention on Human Rights, the European Union acquis and the Geneva convention? What do you think about considering Turkey a safe third country, given that it has not ratified the New York protocol and that it keeps its geographical limitation? What do you think about all the reports on its not being a safe third country by Amnesty International, Pro Asyl and other organisations? What are your thoughts, and what action will you take?
Mr MUIŽNIEKS – I have expressed my views several times on the European Union-Turkey deal during and after its conclusion. The concerns that I expressed at the time remain valid. I am concerned about the legality of returning individuals whose cases have not been properly assessed. I am concerned that that is being done collectively, in violation of the prohibition on collective expulsions. I am concerned by the fact that only Syrians and not other groups in need of protection are mentioned in the deal. I have concerns about the detention of vulnerable people in need of protection in Greece and elsewhere, but also in Turkey on their return. Clearly, there is a need for safe venues for people’s arrival in Europe. Is Turkey a safe third country? I have not assessed that question. I was in Turkey for nine days and we looked at media freedom, the situation in the south-east and balancing security and human rights, and we considered the justice system. The geographical limitation in Turkey is clearly a problem in the European context. It is also clear that Turkey has been incredibly generous in receiving refugees and other persons on the move and that it needs our assistance. It needs our help and to work closely with all of us to ensure that all in need of protection in Turkey get it. We should also help ease the burden on Turkey of hosting and receiving millions of people. It is by far the largest refugee-receiving country in Europe and it probably has more refugees and others needing protection than all the other Council of Europe member States combined. When I criticise the European Union-Turkey deal, I primarily criticise the European Union and not Turkey. My fear is that the European Union might be incentivising problematic practices in Turkey by providing money and detention facilities and urging pullbacks of people when they try to leave the coast. I find that difficult. The European Union should not incentivise problematic human rights practices in neighbouring countries.
The PRESIDENT – Thank you. We will now take three questions; otherwise there will be no time left.
Mr ROUQUET (France)* – Most European States today have to take up the painful issue of terrorism and strike a balance between strengthening security and maintaining the rule of law and democracy. Will you take stock of all the measures that Council of Europe member States have taken and look at best practice, which could inspire all of us?
Mr GHILETCHI (Republic of Moldova) – Mr Commissioner, the removal of children based on an administrative interim order instead of a court decision goes against Resolution 2049, as adopted last year by this Assembly. What is your opinion on this practice in some of our member States? In particular, in Norway, social services removed five children from a Romanian family, which led to an international wave of protest just last Saturday in 22 countries.
Ms PASHAYEVA (Azerbaijan) – Mr Commissioner, our delegation addressed a letter to you about provocation by Armenia against Azerbaijani civilians. From the first day of the recent cease-fire, Azerbaijan has been fully implementing all the requirements of the international law on the exchange of corpses, but we were shocked to see that the corpses of Azerbaijani soldiers given to the Azerbaijani side have signs of torture and mutilation. There are a lot of photos proving these inhuman crimes. What is your stance on these crimes of the Armenian armed forces?
Mr MUIŽNIEKS – The balance between security and human rights is an ongoing issue that needs to be discussed in any country facing a terrorist threat. I have raised concerns in other contexts about the proportionality of measures in France and Turkey. For example, in France I noted early on that there were many, many searches of homes and very few criminal cases related to terrorism. To me, the question of proportionality posed itself in a very strong way, as did the question of enhancing the power of the executive at the expense of the judiciary. My tactic, my way forward, is to work with national human rights structures on these issues. Sometimes they are the key voice in a country raising human rights concerns when everybody else falls silent. The French human rights structures are very good in this regard. They have been raising these issues. The parliament in France has been doing this as well, which I am very pleased about. But there are other contexts in which there is a lot of experience of combating terrorism and upholding human rights. For example, Northern Ireland has years of experience of trying to balance these issues. We have to learn from countries that have more experience in combating terrorism while upholding human rights.
Taking children away from their parents is a broader issue and here the utmost caution is required because we have to think: what is the best interest of the child? The best interest of the child is almost always to be with the parents. Only in extreme and exceptional cases, where the child can come to serious harm because of the parents’ behaviour, should a child be taken away temporarily from the parents. We need to intervene to support families so that they can remain together and children can be with their families. Removing children from their parents should be done only as a last resort and for a very short period.
Regarding the Nagorno-Karabakh conflict and the allegations of human rights violations, I share your concern that when conflict erupts civilians and human rights suffer on all sides. I deplore the loss of lives in this conflict and I pay respect to those who have died. I urge all the parties to the conflict to pursue de-escalation, to refrain from violence, to work closely with the International Committee of the Red Cross and to abide by humanitarian law. One topic that needs the utmost attention is looking into and acting on all cases of missing persons. These cases get more difficult with the passage of time as people pass away and witnesses forget. I am closely following the situation on the ground. I have received these allegations, which are of grave concern. It is very difficult for me and others to follow up on them because very few international observers are on the ground in this conflict area, but I share your concern and I will remain in contact with all the relevant actors in this regard, and will do what I can do.
The PRESIDENT – I do not see Mr Ariev from Ukraine. He is not in the room.
Ms BRASSEUR (Luxembourg) – Commissioner, I take this opportunity to thank you personally for the very good co-operation we had over the past two years. But in those two years, we saw the space of fundamental freedoms shrinking in numerous countries. What can we do in order to work even closer together to stop that trend, which is undermining democratic systems in all our countries? Numerous countries are concerned, and this must be one of our major concerns because it is about the human rights of every one of our 820 million citizens.
Ms HUOVINEN (Finland) – Commissioner, in the foreword to this report you paint a rather dark picture of the situation of human rights defenders. You rightly ask them to stay on the battlefield. Unfortunately, many of those speaking on behalf of migrants and other minorities are forced to silence themselves for the sake of their own security and that of their families. Have we done enough? Is our legislation sufficiently up to date to combat hate speech hard enough?
Ms AHMED-SHEIKH (United Kingdom) – Commissioner, you rightly mention concerns around the potential for human rights violations in the European Union-Turkey deal. What plans do you have specifically to address your concerns? Further, do you have sufficient access and influence within the European Union institutions to be able to make an effective difference?
Mr MUIŽNIEKS – I will start with that question. What will I do? I will address migration-related issues in a number of forthcoming country visits. The next two will be to Croatia and Greece in early July so I will be on the ground examining the human rights implications of this deal and how they play out. I was just in Turkey for nine days. I hope to go back to Turkey when we finish our report and publish it to do some follow-up work looking at the issue of migration and asylum more closely there. I will go to Brussels on a regular basis. Do I have the access? It is not as good as I would like, to be honest. I have good access at the European Parliament. I have good access at the operational level with the European Commission. I have excellent co-operation with the Fundamental Rights Agency. But the Commissioners are not very interested in meeting me to discuss human rights. I have tried on a number of occasions. I do not think they are interested in hearing what I have to say. They read it in the newspapers and think that that is enough. I would like greater access to the Commissioners to discuss these issues.
Have we done enough on hate speech? Clearly not, and the challenge is going to get bigger over time. The far-right extremist political parties have been emboldened. Some of their rhetoric has seeped into the mainstream. Some of the rhetoric appears to justify or give the green light to people acting against migrants and refugees, and it is clear that we will have a lot of trouble on our hands in the coming years and months. Where legislation is not in place, we have to get it in place, but the key thing is implementation of this legislation. Here the work of equality bodies is key. Here the work of human rights defenders is absolutely essential, as is awareness-raising, because if nobody knows how to make a law work, where to find a remedy and where to complain, we are going to have huge troubles. Many migrants distrust the police and law enforcement. We need to really strengthen equality bodies and national human rights structures, because they are the bodies that people turn to when they feel they need help, assistance and a remedy of some sort.
Mme Brasseur, I thank you as well for your co-operation; I enjoyed working with you very much. I look forward to the same kind of co-operation with your successor, Mr Agramunt.
What more can we do? The potential within our Organisation is huge: we have huge intellectual capacity and the best legal standards in the world. We are the region with the densest network of human rights organisations anywhere. Yet we see huge human rights problems, backsliding and a pretty dark picture unfolding in front of us. What does that mean? It means that we have to be creative in working together in respect of the monitoring mechanisms of parliaments and governments. We have to find new ways to involve and engage civil society and to be very smart in our communication about human rights. We have to be where the events are happening and address young people in a language and through a medium that they use and understand. I am so happy that now the Council of Europe is active on social media; if you remember, four years ago the Council of Europe had never heard of Twitter and Facebook. If we want to touch and address young people, it is clear that we have to be on these media.
We have to be creative in using the Court and in pushing States to implement judgments. For me, that means being creative and strategic in intervening as a third party. We have to make sure that States implement judgments – that they do not get a free ride at the Committee of Ministers, that they are not let off the hook and that they really implement and change what needs to be changed to avoid repeat applications. We also have to work better with our partners in the European Union, the OSCE and the United Nations. We have to stop being jealous about who is going to get the credit for doing good work. Here Ukraine is a good example: all the different partners are working well together. Of course everybody wants to take credit for good work, but what I have seen so far in Ukraine, with its dense population of international organisations, is that everybody is working quite well in a complementary manner. The only way to move forward is to work better together with our partners as well.
Mr SCHWABE (Germany)* – Thank you, Commissioner, for all your work which has set a yardstick for us. We have been talking about the shrinking space of NGOs and human rights organisations. How would you describe the situation in the 47 member States in the last year? Are there any negative examples of legislation? You mentioned your visit to Turkey. What is happening to the people who have been pushed back by the European Union into Turkey? How are they doing?
Ms BESELIA (Georgia) – Welcome, and thank you for this important and interesting report. I want to ask about Georgia, which has carried out great human rights reforms in the past few years and achieved great success. Violation of the rights of our citizens is in many ways the biggest problem in the occupied territories. What is your opinion about the problem?
Mr CSENGER-ZALÁN (Hungary) – Commissioner, in recent years there has been little if any progress in the conflicts within the Council of Europe area that hinder or make impossible the application of human rights standards. Just weeks ago, we witnessed how quickly a frozen conflict can heat up. How do you assess your role and the means at your disposal in addressing the situation of human rights in those regions?
Mr MUIŽNIEKS – I will start with the question about NGOs. I think that the situation in Russia and Azerbaijan stands out in terms of the legislative framework for NGOs. The foreign agents law has had a deleterious effect on the work of civil society and NGOs in Russia. We have documented that by analysing the law’s compatibility with Council of Europe standards and its implementation, and all our worst fears have come true.
In Azerbaijan, one of the problems facing many of the human rights defenders who were imprisoned or detained was that they were working on the fringes of the law; the legislative situation is such that doing legal human rights work there is almost impossible. These people were forced to the edges of the law and then prosecuted for violations that would not be violations in many other member States.
In Turkey, I met many human rights defenders and lawyers who are facing huge administrative, political and media pressures. What struck me most was the number of cases about defamation of the president and other officials that were being pursued in courts. Some 1 845 people face criminal charges for defaming the president in Turkey. The Mayor of Ankara has more than 3 000 cases pending, many of which are against human rights defenders who have only retweeted or reposted Facebook posts. That should not be criminally penalised. The situation affects the whole landscape of human rights defenders in a very serious way.
During the nine days I was in Turkey, I did not address the issue of the people who have been sent back there – other issues were on my agenda. However, I remain concerned about the fact that people are being detained and not getting a serious hearing before being sent back to their countries of origin.
I turn to Georgia, and especially the territories of Abkhazia and South Ossetia. I was in Georgia in November this year. I contacted the relevant interlocutors to do work in Abkhazia and South Ossetia, but a visit was not possible at that time. I intend to continue my efforts to go and do work there; these people deserve the protection and attention of the Council of Europe, but they are not getting it to the extent that they should. It is often difficult to gain access to some of these places. Sometimes I succeed, while at other times I fail.
A month ago, I was in Donetsk, which is not a very safe place: a United Nations human rights representative was kidnapped by the so-called authorities there. It is very difficult to do human rights work in Donetsk, but I was there. As I mentioned, I was not able to go to Abkhazia and South Ossetia. I have been to Transnistria briefly. There is a mixed bag when it comes to where we have access and where we can do work. All these people deserve our attention. I am particularly concerned about Donbass in eastern Ukraine. It is a large territory – not a small sliver of land with 10 000 or 100 000 people, but a huge piece of land that is becoming more and more isolated. We have seen how such situations can end up and we should do all we can to gain access and try to work there for the benefit of human rights. I was disappointed at the access that I got in Donetsk. Since I was going back a second time, I was hoping that I would have higher-level meetings and get access to other places. I did not get that. It was a disappointment. I will try again and keep trying until the end of my mandate.
Mr HANŽEK (Slovenia) – In the past decades, many European countries have participated in the destruction of countries in the Middle East. One of the consequences of that unethical and illegal destruction has been the mass exodus of people to Europe. The majority of European countries are now failing to do their human duty to help the people whom they made homeless. Racism and hate speech are on the rise. The European Union has institutionalised the selection of refugees and silently permits the violence against them. What is your opinion on this matter, which is so shameful for Europe?
Ms ZOHNRABYAN (Armenia)* – At the beginning of April, Azerbaijan launched an attack against Nagorno-Karabakh using its regular army, in violation of the Geneva Convention. The Azeri troops attacked targets in Martuni and Martakert. You were informed about the massacre and the mutilation of Armenian soldiers who had been killed. Those are violations of international law. It would be good if you could highlight those atrocities.
Ms MATEU (Andorra)* – Commissioner, thank you for your report, which is interesting but also quite scary. You told us that in 2015 human rights were violated in many of our member States at different levels. You have asked us not to give up the fight, but I wonder whether you have any solutions to suggest – perhaps not a magic formula, but something of a solution to apply to resolve the situation.
Mr MUIŽNIEKS – Let me start with the last, most philosophical question. I think that human rights defenders and free media are essential to make the whole system function. If human rights defenders cannot provide assistance to people, if they cannot make the domestic remedies work and if they cannot make the European Court of Human Rights work, the system falls apart. So anywhere where human rights defenders are under threat or being pressured, and anywhere their organisations are being run out of business, we should take note and act immediately, because that will affect the functioning of the whole system. These are our partners; these are our friends. These are the people who are trying to bring our values to life at the national level. So, as far as I am concerned, human rights defenders are an absolute sine qua non for the existence of the whole system.
Media freedoms are also absolutely essential and foundational. Without media freedoms, there can be no free elections, no freedom of religion and no freedom of assembly. If media are not allowed to do their job to investigate wrongdoing and human rights violations and hold the authorities accountable, the system cannot function. There is no democracy without media freedom. So those two indicators are essential, and that is why I spend so much time looking at them.
On Armenia, I already expressed my grave concern about the fact that again people are dying in this region. That highlights the need to sit down and negotiate and for the international community to pay attention to this conflict once again. People need to sit down at the negotiating table and to work with the International Committee of the Red Cross. That is all I can say about that.
Regarding the colleague from Slovenia’s question on Western complicity in the destruction of certain States, this is a bit beyond my mandate, but I would say that Mr Bashar al-Assad did not have a whole lot of western assistance in destroying his own country; he destroyed it himself. The largest single source of people who need protection now are coming from Syria, a country that was destroyed by the regime and people who are still in power there. It is clear that we have not been sufficiently aware of how our interventions elsewhere will create problems for us in the long term, not only for the countries in question about what happens after an intervention or conflict, but also in terms of the huge human costs that stretch out for years afterwards with vulnerable people seeking protection and not receiving it, but being turned away. We have a special responsibility where we have intervened on a moral level.
It is quite difficult for me to engage in these countries because they are outside the space of the 47. When people ask me, “Why aren’t you doing things in Syria or Afghanistan and Iraq?” I say, “I would really like to, but I have plenty of work in the 47.” If we can maintain a minimum level of human rights protection in the 47 and maintain the functioning of our system, that will be quite an achievement in and of itself.
Ms CHRISTOFFERSEN (Norway) – Mr Commissioner, in your speech you claimed that unilateral measures taken by several countries that make us less attractive for migrants, such as cutting benefits, seizure of migrant assets, short-time protections and restrictions on access and family reunification, will all hinder integration without any impact on the scale of arrivals. What kind of policy and concrete measures do you recommend as an alternative to those restrictions?
Ms KERESTECİOĞLU DEMİR (Turkey) – Mr Muižnieks, in a press statement you mentioned that Turkish authorities reassured you that action against racist and degrading behaviour by security forces is necessarily enforced. From the beginning of the curfews, not one security officer has been investigated and victims have been left out without justice. How will investigations be conducted? If you could have visited the Kurdish cities beforehand, would you and the Council have taken a more active role to stop human rights violations in Turkey?
The PRESIDENT – I welcome you, Mr Luis. This is the first time you have spoken in the plenary.
Mr LUIS (Spain)* – Thank you, President. Commissioner, you and your team have shown your dedication to human rights. The European Union signed an agreement with Cuba. It seems to me that as Commissioner for Human Rights you should be addressing that for the Council of Europe. Do you think you can make a contribution to give greater freedoms to the Cuban people? Could you commit yourself to that? Could you also commit to assessing the situation that currently prevails in Cuba?
Mr MUIŽNIEKS – Cuba is outwith the 47, and it is quite difficult for me to engage outside of that. I do try to inject human rights into discussions about Europe’s relations with other countries. Although I have not touched at all on the Cuban issue, I am following with great interest the political developments there, which I think are quite hopeful.
Regarding Turkey, it is clear that the impunity of security services is a long-standing human rights issue of concern. My predecessor raised it in his reports and there is a very large amount of case law at the European Court of Human Rights about the impunity of security services and the lack of effective investigations. I raised it in my report after Gezi, and I have concerns about the situation now. What was I told by the Minister of Interior? I was told that there are currently nine proceedings against security service officials for various forms of misconduct and some probably concern very grave crimes; they include, for example, dragging the body of a person behind a military vehicle, sharing photos of naked women on social media as well as other crimes. Nine is not a big figure.
I urged the Minister to pursue his efforts vigorously, to publicise the punishments doled out to those nine and to look into other allegations of serious human rights violations, of which there are many in the context of the operations. I was also told that there is an independent civilian investigator looking into allegations of racist abuse: slogans of some songs and messages circulating on social media. Again, I look forward to seeing the results of those investigations.
What I would propose in opposition to or in place of the restrictive measures we are seeing? We will shortly publish an issue paper on integration policy. What does integration policy presume? It first presumes that people are not going to be present for a very short period – that people will come and need protection for a while. They will need security in their situation; in other words, they will need a status that is not temporary in nature, but long term, with the prospect of eventually gaining permanent residency and perhaps even citizenship. That was one of the faulty assumptions that hindered integration policy in Europe in the past. Many people assumed that people would come for a very short period and then leave, and they were kept separate, had temporary status and were not given access to full rights. That hindered their integration.
A key challenge is inclusive education – making schools open to all. That is an issue I have addressed in the context of Roma and of children with disabilities, and it is an issue that will be very topical for migrant and refugee children. Our schools will need investment, our teachers will need training and our facilities will need to be expanded in order to accommodate these new arrivals and to make them integrate better into our societies.
It is clear that family reunification is a tough issue, because sometimes the families in question are very large. If we allowed everybody with a family member here to come into Europe, it would represent a huge jump in the figures. But if we look at it realistically, people are moving to reunite with their families anyway; they are doing it surreptitiously and in an irregular manner, such as by paying smugglers. These are the people who are most desperate to come to Europe – the people who need protection and whose family members are already here. It is clear that we need to look closely at this issue and see if we can find a good solution that will not mean an explosion in the numbers but will reduce some of the pressures and provide a safe venue for people to reunite with their families and start new lives. That is the only way that people will start new lives and participate in and contribute to their societies – if they feel safe and secure and they have their family members, particularly their spouses and their children, with them. Stay tuned: we will soon publish the issue paper and it will address all the issues that I have just mentioned.
Thank you very much for your attention, your questions, your interest and your support. I look forward to seeing you here and in your countries. I have two years left of my mandate. Two years is both a short and a long time. It is a long time in this dark period for human rights in Europe, because a lot of things are going in the wrong direction. We need to work together, and I urge you to join me in raising these issues, asking the difficult questions, looking at the most vulnerable and finding creative solutions and at how we can maintain our human rights acquis in this very difficult time. It is only through working together that we will be able to do that.
The PRESIDENT – We must now conclude the questions to Mr Muižnieks. Questions may be submitted in writing, and I am sure that the Commissioner will be glad to answer them. On behalf of the Assembly, I thank him most warmly for his presentation and for the answers he has given to questions.
2. Current affairs debate: the case of the “Panama Papers” and the concern about fiscal, social justice and public trust in our democratic system
The PRESIDENT – The next item of business this afternoon is a current affairs debate on “The case of the “Panama Papers” and the concern about fiscal and social justice and public trust in our democratic system”. I remind you that we have agreed that speaking time in all debates in this session will be limited to three minutes.
The Bureau has decided that the debate will be opened by Mr Stefan Schennach of the Socialist Group, who has 10 minutes.
Mr SCHENNACH (Austria)* – The Bureau decided to entrust me with this responsibility because I was recently a rapporteur on dirty money for the Council of Europe. Solid finances are the cornerstone of the international system, and that was the thrust of the resolution that Dirk Van der Maelen presented to this Assembly in 2012. The Assembly was also happy to endorse that resolution. However, since Dirk Van der Maelen’s report and his call for an appropriate approach to promoting tax policies, the reverse has come to pass. We still have certain regulatory oases – tax havens – that have become more widespread. The so-called Panama papers only go to prove the veracity of that assertion.
I will not talk about Presidents, their families, individual members of Governments or banks this afternoon. I will not name names as such, but I want to emphasise how criminal this is. All this money is lacking for the education of children, for old age pensions and for infrastructure. This is not a peccadillo or a trivial offence. Look at the figures: $7.5 trillion is currently stashed in tax havens. Gabriel Zucman’s report says that $6 trillion of that amount has never been taxed. Some 10% of European assets are stashed in tax havens. A particularly telling fact is that 30% of the net wealth of the assets of African States are in tax havens – and, by the way, 50% of Russian assets are in tax havens.
In 2009 – this is when this whole story started, when we tried to clamp down on tax evasion and tax havens; we have been at it for some time now – the United States authorities found that 83 of the 100 largest companies in the world had part of their assets in offshore tax havens. As early as 1995, the Organisation for Economic Co-operation and Development (OECD) adopted guidelines and subsequently put together a blacklist. Seven years after that first blacklist, 47 countries ran tax havens – these non-regulated oases. In 2011, the NGO Tax Justice Network compiled a so-called finance secrecy index, in which it listed 71 countries. That was the year of course that the report by my esteemed colleague Mr Van der Maelen was adopted, and I am delighted to see his name on the list of speakers. In 2011, Zucman published a book on where the wealth of nations is to be found.
In 2011 we had a G20 summit in Cannes which decided that it would have an automatic exchange of information on tax matters. That was the agreement reached on that occasion. What is the state of play now? Well, obviously, an awful lot remains to be done, which is why that call from the Parliamentary Assembly back in 2012 was so important. It is important to strive for harmonisation of European corporation tax. We must have a basis on which to take a step towards the fair taxation of multinational corporations. We also need the automatic exchange of tax data, not a system whereby that information must be specifically requested in individual cases. What about Amazon, for example? Where does Amazon pay taxes and where does it operate? The work is done in Cologne, the treaties, agreements or contracts are in Luxembourg, and the money comes from Ireland. Everything is divided up and then hidden.
The most important thing is to look at where all this money comes from. The profits are generated and the company does not want those profits taxed. However, the money comes from money laundering as well as from political corruption and active tax evasion. That is why we must look at the players, including leading banks and their various regional branches, and law firms. Some 214 000 shell companies are listed in the Panama papers, but the offshore leaks in 2013 listed about 130 000 or so, so you can see how the situation has proliferated in the space of just a couple of years. We are talking about money that States need – money that States and their citizens are being deprived of. Mossack Fonseca is just one player among many. Looking at my papers, I could list at least 20 such law firms as well as 500 European banks and their subsidiaries, which have at least 15 600 shell companies. Just look at the Netherlands, where there are 46 000 companies that do not have a single employee.
Liz Nelson, a director of the Tax Justice Network said:
(The speaker continued in English.)
“None of the reforms we’ve seen would have taken place without pressure from civil society and the streets…it’s essential to keep up the pressure, especially on matters such as implementing public disclosure of company ownership and, crucially, of trusts.”(T
(The speaker continued in German.)
That shows just how necessary this is. €1 000 billion is evaded every year and the deficit of the European Union is currently €419 billion, so just half of a year’s tax evasion would do a great deal to help the economy of European Union member States. We must try to dry out the swamp of tax avoidance by calling for full transparency and reiterating the calls that we made in 2012, notably for country-by-country reporting. We must look at profit shifting, which I talked about earlier. Profit shifting must be sanctioned because we must put an end to tax dumping in Europe. We need to drain the swamp.
Countries are destroying one another because of tax competition and severe criminal sanctions are needed as penalties for such offences. We should be able to close down subsidiaries of banks that are involved in such activities. It is advisers and law officers as well as banks, and they cannot carry on doing something that is detrimental to the welfare of countries and ordinary people. We should use the Panama papers not to point the finger at individual presidents or families, but to talk about the principle of tax evasion in general and the harm it does to prosperity in all our societies.
Mr VAN DER MAELEN (Belgium, Spokesperson for the Socialist Group) – Dear colleagues, does anyone in this room know Miss Aida May Biggs? I guess you do not know her. She lives in Panama and is 93 years old. Nothing special, you might say, but here it is: she is director of 17 539 offshore companies ranging from shipping to banking. Before the scandal broke – you may not believe me, but it is true – she was not even aware that she was the director of 17 539 companies. If, by accident, one of our fiscal administrations found out about one of these offshore constructions, its investigation would end with the name of Mrs May Biggs. The fiscal administration would never get to the real beneficiary or owner.
Thanks to the Panama leak, we know the identity of all those hiding behind Mrs May Biggs and our fiscal inspectors can start to do their work to see whether their activity is tax avoidance or evasion, and whether it is illegal or not. If we do not want to depend on leaks in the future, we must thoroughly analyse what we learned in the Panama papers. We must strike a good diagnosis and start to act. My analysis is that the Panama papers are about lawyers who offer “flexible” services and do not legally have to know if their clients are tax evaders or avoiders, corrupt politicians or terrorists.
The Panama papers are about banks that flatly ignore European directives and national legislation. What actions should we take? In my report, to which Stefan Schennach referred, I proposed measures: open ownership of companies; sanctions for unco-operative tax havens; and sanctions for the intermediaries in the financial service sectors including banks, lawyers and accountants. Finally, we must install an obligation for all banks to report on financial transactions with tax havens.
Mr PASQUIER (Monaco, Spokesperson for the Alliance of Liberals and Democrats for Europe) – The Panama papers is obviously an ongoing story: the story of one law firm in one country that clearly represents the tip of the iceberg. Some say it represents as little as 5% of the overall offshore market. We therefore need to be very cautious in our comments. There is no doubt that more is coming.
The first question the ALDE group asked itself is how this information came out. Most probably, it came out through theft and leaks. Are the people responsible truly independent, or do they have their own agenda? We do not know. Does this mean we need to shoot the messenger? Clearly not. The emotion created worldwide by the disclosure should be viewed against a backdrop of high unemployment, high public deficits in many countries and a widespread feeling that the political process is hijacked by a privileged elite, not to mention the increasingly skewed distribution of the benefits of economic growth worldwide.
What is the rule of law? Believe it or not, owning an offshore company is not illegal in many countries provided proper disclosure policies are followed. Many innocent people have therefore been wrongly implicated. Tax evasion is wrong and should be fought, but what about tax optimisation? Is it not legitimate for an individual to seek the lower legal tax path? This does not mean that Panama is right. It has not signed an automatic exchange of information agreement with the OECD. Panama has been a laggard in complying, but it is not the only one. The United States, a member of the OECD, has not signed the agreement either. Some US states, such as Delaware, benefit from opacity, as do many, many others – deux poids, deux mesures.
We need a level playing field and we do not have one. The Parliamentary Assembly of the Council of Europe needs to co-ordinate action to avoid giving citizens the opportunity to choose between competing jurisdictions. We need a common approach that recognises that for a country to market financial product that allows non-residents to evade tax in the country they reside in is wrong. Until we have agreement on this we are nowhere. Until we have an agreement on this, there will be many Panama papers stories. Our citizens will look with increasing suspicion at their political and economic elites. Who can really blame them?
Lord BLENCATHRA (United Kingdom, Spokesperson for the European Conservatives Group) – President, I hope the Assembly will permit me to speak from a seated position.
There are three separate issues, which are usually conflated, in the rather ignorant denunciation of all so-called tax havens. The first relates to companies such as Starbucks, Google, Apple, Amazon and so on registering their companies in low-tax jurisdictions, especially Luxembourg, and thus paying less tax than in the countries where they sell their goods. Everything I buy on Amazon in London is logged as being supplied by Amazon Luxembourg. This is called transfer pricing or profit shifting, which is perfectly legal under international law. If we think it is wrong, and most of us do, then we all need, internationally, to change that international law. That is what the OECD has been working on. However, we shall see how successful it will be. The problem will simply be that if only the top OECD or G20 countries do it, then business will select another jurisdiction that will not comply with OECD recommendations.
The second issue is so-called offshore jurisdictions to create shell companies that hide the real or beneficial owners of those companies. These may be used for aggressive tax avoidance, which may border on evasion and criminality. I say so-called offshore, because that terminology is no longer right. It used to be 30 years ago, but there is nothing done in company formation in Panama or in the British Overseas Territories that is not replicated on a major scale in London, Frankfurt, Amsterdam, Luxembourg, Liechtenstein, the United States, Hong Kong, Shanghai and every major onshore jurisdiction. The largest “offshore jurisdiction” in the world is Delaware in the United States, followed by Nevada. In fact, a detailed study by Professor Sharman of Griffith University in Australia rated some States in the United States as the easiest place in the world to set up fake companies that could hide terrorist, drug and criminal financing. Thus the unique British initiative to reveal full transparency of company ownership in the United Kingdom is, I say regretfully, naïve, since not a single other OECD country will do it. Delaware has been specifically adamant that it will not change a single comma of its law, no matter what President Obama may spout at international gatherings. Indeed, why are there no Americans in the Panama papers? It is because the United States has a much larger and more secretive shell company system.
The third and final point is one that the media, public and politicians ignore or pretend does not exist. That is the perfectly legitimate and sensible use of offshore, neutral jurisdictions to raise funds for investment. This is at least 95% of the work of offshore funds, but there are no votes in defending it. If, say, Volkswagen – or any other international company – wishes to raise €500 million to build a new car plant in Brazil, it would need to attract funds from international sources. It will create a special purpose vehicle or fund, based in a tax-neutral jurisdiction. It will then receive funds from investors in Frankfurt, Singapore, Shanghai, New York, London and so on. It will put all that money in a pot and invest it legitimately in Brazil. That is a perfectly legitimate use of offshore so-called tax system.
Mr JÓNASSON (Iceland, Spokesperson for the Group of the Unified European Left) – The revelations of the Panama papers do not come as a surprise in the sense that we were all aware that there was a financial world hidden away, and we knew, more or less, where it was located. This has been a concern for many governments and organisations, most notably the OECD. Concerted efforts have been made, with some success – or so we thought – to eliminate tax havens and hidden financial transactions. In Europe, the spotlight was originally on Switzerland, Luxembourg, the Channel Islands and the City of London, which of course has long been surrounded by secrecy. What is surprising and shocking in the Panama revelations is the enormity of these practices.
The Panama papers, 11.5 million financial and legal leaked records, are only the tip of the iceberg – or probably a little more than that – but they are based on the records of only one particular firm, Mossack Fonseca, which appears to have provided the framework for individuals and companies to hide their assets. The importance of these revelations is that they expose a secretive system that facilitates crime and corruption. I want to emphasise that the reasons and motivations of the individuals and companies involved may be very different – we should be careful not to generalise.
In my country of Iceland, the leaks have already had great repercussions. Our Prime Minister, who was personally involved, has had to resign from office. Other Ministers who have apparently been involved in debatable financial transactions are now under fire. It should be said that our former Prime Minister is, in fact, a man of very good qualities – to this I can testify. His defence and moral justification was that he had always paid taxes on his assets according to the law of the land, but which land and which assets? That, of course, is the crucial question, as well as the problem of verification. The crux of the matter is tax evasion and secrecy. Recent developments and events in Iceland and elsewhere, with mass demonstrations and calls for the resignation of politicians in the wake of the revelations of the Panama papers, reflect the public outrage over the realities: one world for us, the general public, and another for the millionaires who do not contribute to our welfare system as they should. It reminds us of the aggressive neo-liberalism that was rampant towards to the close of 20th century and during the first years of this century, when people advocated public cuts and paved the way for competition between States by offering lower taxes. That, in turn, meant cuts in public expenditure and was, in effect, an assault on the welfare State. This primarily explains the public outrage, which is a healthy sign of democracy.
I am speaking on behalf of the Group of the Unified European Left, which is united in demanding more revelations, more transparency, more accountability and, not least, a higher standard of morality in politics and in the business world.
The PRESIDENT – Thank you, Mr Jonasson. If anyone takes more time than they should, other colleagues on the list will not be able to speak.
Ms SCHOU (Norway) – The strength of the democratic system can be measured in trust. The Panama papers have led to a dramatic fall in people’s trust in democratically elected leaders. It is important that the outcome of this crisis is more trust through transparency and better international co-operation. Journalists and civil society play a crucial role in the trust between the electorate and elected officials. Without the media and non-governmental organisations, we would not be where we are today when it comes to exchanging information on financial accounts and taxation. About 80 countries have signed the OECD common reporting standard, which will contribute to ceasing bank secrecy. The Norwegian Government has actively participated in developing this standard, and we will reap the benefits from 2017, when we will receive account information about Norwegian taxpayers abroad. More countries must join this important standard.
Secrecy in the financial sector is a general problem, but it is especially difficult for developing countries. Illegal capital flows undermine economic development. The poorest countries are hit the hardest. In some of them, the illegal capital flows out of their economies are higher than the incoming international aid and investment. The Norwegian Government has worked hard to bring this issue to international attention. In co-operation with other Nordic countries, we have led the work to put it on the World Bank’s agenda. In March this year, the bank published its first report, including an outline for an action plan. It is a good start.
In conclusion, I should like to return to trust. As members of parliament, we can start with ourselves. We must follow our parliamentary regulation on disclosing financial interests. If your parliament does not have such regulations, it is time to make them. If the regulations are not good enough, it is time to upgrade them. Only last week, the Norwegian Parliament decided to remove the threshold for the registration of financial interests. All Norwegian parliamentarians must now register all the stocks that they own. We hope that this will contribute to strengthening the Norwegian public’s trust in us.
Ms DALLOZ (France)* – The Panama papers affair shows to what extent the fight against tax havens and the establishment of fiscal transparency have not been achieved and remain necessary. It is a global scandal, but it takes on particular importance here in Europe where the crisis has forced a number of governments to resort to bold but difficult austerity measures and the eurozone remains fragile and youth unemployment remains high. If we look beyond the football stars or heads of government, we should be concerned by the presence of European companies on the lists that have been leaked, because that raises the issues of transparency and the establishment of a public fiscal reporting system. In Europe, as in many other areas, only concerted action will enable us better to control the flow of funds from companies, without creating discrimination between them, according to their country of origin.
We had this self-same debate in the National Assembly in December. Although I am a member of the opposition, I supported a government amendment that sought to prevent France from being discriminated against by introducing measures to ensure greater transparency too early. We wanted to avoid any risk to the competiveness of the 8 000 French companies that such a system would affect. Not only would a public reporting system concern multinationals, but the information provided could be used by competitors and business or commercial strategies could be divulged.
The European Commission has taken a stand on the issue through its French Commissioner, and the European Parliament has already spoken out in favour of such a scheme. However, the Commission still needs to draft a directive that all countries concerned would have to apply. Only this method will ensure genuine transparency. Some countries have made genuine efforts to lift bank secrecy and to exchange information – our Swiss neighbours, for example – but the position of offshore locations remains delicate.
Are we really surprised when the city that is Europe’s most important financial centre is at the same time active in the global offshore financial system? Of course, we are condemning not the incorporation of offshore companies – that is not illegal in itself – but their use to facilitate tax fraud, and the Panama papers are a flagrant example. Exempting crown dependencies such as Jersey from any kind of control or from the lifting of secrecy is no longer compatible with the requirements of transparency; but of course, I could cite other countries, such as Panama, which have turned this illegal activity into a windfall for their economies. We must send a clear message to our citizens that, if they want to enjoy the rights of democracy, they must also respect its obligations, including by paying their taxes.
Ms HUOVINEN (Finland) – One per cent of the world’s richest people jointly own more than the rest of the world’s population put together. According to Oxfam, 62 people own the same amount as half of the population on earth. In the past five years, when we have been hit by a severe financial and social crisis, those 62 people have increased their income by 44%. Frankly, I feel that they are piggybacking on us all.
During the last election period, the Finnish Government launched an action programme to combat tax evasion. The aim of the programme is to create key action to address international tax avoidance and to clamp down on tax havens. The main focus was on securing the tax base and combating harmful tax competition, tax monitoring and the exchange of tax information, transparency of information, public procurement and tax issues related to development co-operation.
The fight against tax havens requires not only national action but stronger action at the international level. The companies playing games with tax solutions erode the tax base and weaken the future of society. I welcome the initiative by the unions of public officials to launch a European Union-wide campaign in support of transparency in the tax system. The European Commission has also published a legal proposal with the aim of reducing tax evasion and aggressive tax avoidance. This important draft proposal is very timely indeed, but it is far from perfect. An essential shortcoming is the lack of public country-specific reporting, and the limit on the compulsory reporting of net sales is too low, thus leaving several multinational corporations outside the scope of the proposal. That is particularly important because tax avoidance by those multinationals creates a €70 billion gap in tax revenues at the European Union level. That amount of money could be used to secure quite a lot of services for our citizens. Let us hope that the Panama papers are the beginning of the end of tax havens.
Ms RODRÍGUEZ RAMOS (Spain)* – Distinguished colleagues, it is a year since the Lampedusa tragedy, when many people – women and children – drowned, and their traffickers most likely laundered the money in tax havens.
We have non-co-operative jurisdictions and places in which business dealings are opaque. The possibility of laundering money in those places, evading taxes when they are due, or laundering the proceeds of crime, undermine the foundations of our society. Yet another scandal in this sorry saga is the Panama papers, which have become public. Many people from governments and within the European Union have been affected. For example, a minister in my own country has stepped down. Those are the same people who are punishing people with cuts to social services at a time when government resources are scarce. The damage therefore is enormous.
We know exactly what tax havens do, and we know precisely the instruments used, so it is possible for us to stop this happening. The time is over for indignation; the time has come for action. We need to do something about this. Banking secrecy is a huge problem, and we need to impose sanctions on countries that fail to comply with requirements. We need to look at the legal personalities of the incorporated companies in tax havens.
The time has come to clamp down on those practices and on the banks that are subject to regulations in Europe but decide to channel their profits or money through subsidiaries in order to evade European or international regulations. The same is true of multinational companies that do not divulge all of their operations or transactions in a list, as suggested by the European Commission. We also need country-by-country reporting, which we have called for in the past. There is a huge gulf between ordinary people who are suffering and politicians who, after all, are supposed to represent ordinary people. They should not be complicit therefore in these kinds of goings-on.
Mr VAN de VEN (Netherlands) – I thank you, Mr President, for allowing me to take the floor and address the distinguished delegates of the Council of Europe on behalf of the Dutch People’s Party for Freedom and Democracy. I congratulate the presidency on putting the Panama papers on the agenda of the Council of Europe. It shows that the Council of Europe is alive and kicking.
In respect of the Panama papers, I make a clear distinction between tax avoidance and tax evasion. My party is clearly against international tax evasion. Tax fraud is unacceptable. Tax evasion should be challenged at not only the national but the international level, including in Panama. Tax avoidance, on the other hand, is quite a different matter. It concerns arranging one’s tax affairs when contributing tax due to the national tax authorities, and it is within the borders of national and international tax laws. Multinationals, active international entrepreneurs and rich individuals cannot be treated as the milch cows for all kinds of political hobbies. Governments should be lean and mean – small, efficient and effective.
These were the Panama papers, but they could also have been the British Virgin Island papers, the Curaçao papers or the Guernsey papers. They have a historical background. International opaque legal structures with tax avoidance effects have sometimes been created in the past due to genuine fears, such as fear of communism and expropriation by dictator states. Those structures were not directed at money laundering and drug trafficking. They were historically created in a world that was not transparent, and the States in general were not so much concerned about tax and foreign markets.
On the Panama papers, the call of citizens is clear: vox populi, vox dei. That old Roman saying makes clear that the voice of the people is the voice of God – now the government. With the Panama papers, opaque international legal structures are now under severe scrutiny by our citizens. The papers require action from the Council of Europe and pressure on States to be transparent for tax purposes on individual tax positions. Our peoples and our citizens no longer tolerate opaque international legal structures that allow taxation to be avoided, but privacy must be upheld to take account of the genuine and sometimes, alas, justified fears of entrepreneurs.
Mr POZZO DI BORGO (France)* – The eruption of the Panama papers scandal reveals two major things. One should serve as cause to rejoice, and the other should prompt us to continue an old fight.
The good thing is that thanks to the actions of the press, we can now reveal fraudulent practices and ensure that nothing that touches in any way on public morality can be hidden from justice, from citizens or from those who represent them. This episode of the Panama papers will be the emergence of a counter-power – that of whistleblowers and investigative press acting at a global level. We can but welcome the progress of this forced transparency, but it is a transparency that has to learn to regulate itself so that it does not become a lynching tool in the hands of the media; rather, it must contribute to the progress of justice, transparency and fairness.
Panama is in the spotlight currently, but it is certainly not the only area worldwide where money can evade the tax authorities and find a haven. Our English friends have legal tax havens. In the United States, there are three states – Nevada, controlled by the Chicago mafia, Delaware and Wyoming – where it is possible to open a company while hiding the name of the beneficial owner. In the United States, some $1400 billion evade the tax authorities annually – that is legal money, not the dirty money of the Mexican mafia or the American mafia. It is a little bit rich when we know the impact on our European banks of the extraterritorial scope of American legislation. One wonders about the role of the United States in launching the Panama papers, but at least we stand to gain something from them.
If we look beyond the legitimate nature of the tool that made it possible to read all this information, what does it actually reveal? Basically, we are talking about a sophisticated universal tax evasion practice that is organised so that well-known people from various sectors, such as politics and sports, as well as those who are less well known can evade scrutiny. Given these practices, the temptation is great for many – we are seeing this already in Europe – to seek refuge in populist parties. That is why generalised suspicion is a danger. As far as the European Union is concerned, the revelation of such fraud has served only to endorse its own efforts in curbing tax evasion. This is an opportunity for us to grasp when it comes to promoting greater transparency and exemplarity.
Mr KANDELAKI (Georgia) – I thank the authors of this courageous investigation known to us as the Panama papers. The secrecy or confidentiality of assets per se is not illegal, but politicians, political office holders and civil servants cannot have that secrecy because it is incompatible with the principle of transparency. Tax evasion and money laundering are one thing, but the Panama papers remind us of another important question for democracy: the origin of money in politics. To what extent are secretive companies used to influence politicians and political decision making? To what extent are politicians accountable to the secret originators of money rather than to their people and their voters?
Those questions are most acutely visible in the former Soviet Union, first and foremost in my country of Georgia. Former Prime Minister Bidzina Ivanishvili is very prominently featured in the Panama papers. He hid his French passport – he is also a French citizen – to avoid his taxes to the French State. He remains the main decision maker of the current government. Georgia is an example of the way in which dubious money can threaten the fundamentals of democratic political systems. In a democratic political system, it is the job of politicians to represent their voters and their people rather than unelected benefactors and oligarchs. The Georgian Prime Minister, who will address the Assembly this week, is a former personal banker of Mr Ivanishvili. Other key members of the government are former personal assistants – doctors or whatever – in Ivanishvili’s companies.
The prime minister and other ministers have almost interest-free loans from Mr Ivanishvili’s private bank. According to documents, we know that they cover those loans with funds that exceed their officially declared income. That is either money laundering, or ministers and the prime minister, who will address the Assembly, has more money than they have declared, which is obviously illegal.
We have to follow up this important issue. It is in the core mandate of the Assembly and the Council of Europe to deal with such considerable and serious threats to the fundamentals of democratic political order, such as dubious and illicit money in politics.
Mr SHAHGELDYAN (Armenia) – Colleagues, there are internal and external aspects of the recent offshore money scandal. It is extremely important that we clamp down on the illicit funding of politics. If the international community wants a more transparent system, it must improve the transparency of financial operations offshore, which it can do. The individual efforts of single countries will be far less effective than the concerted efforts of groups of States or international organisations. The international community should therefore find a balanced solution to boost the transparency of offshore areas and corporate responsibility while preserving a free business environment and a level playing field in the international market. All countries must join in that common effort.
Secondly, offshore money is used in international politics, which is extremely dangerous. The President of Azerbaijan is well known for using his country’s money to fund excessive militarisation and aggression towards Nagorno-Karabakh – so-called caviar diplomacy. He has gained wealth by not paying taxes back home, but he also hosts Azeri refugees. Where is all that money coming from? It is coming from those offshore havens.
The rapporteur’s report is extremely important domestically and internationally. There are two aspects to the international situation – the commercial and business law aspect, and the geo-strategic aspect.
Mr VALEN (Norway) – Last September when the Assembly discussed the report on the OECD, we saw that the labour share of income in OECD countries was shrinking. Despite all our advances in efficiency and technology, those who do the work now get a smaller share of the value created. How can that be? Both the European welfare systems and the American dream were made possible and legitimate by tax systems that redistributed wealth.
When uncounted wealth is stacked away in tax havens, it undermines a very important part of the social contracts of our countries. It threatens the social stability of Europe. Ordinary people have a harder time making ends meet, even though they work all they can. At the same time, they see a small elite get away with an even larger share of the growth. Furthermore, much of the wealth is hidden away.
The Panama papers have revealed some of the scope of the theft from the world’s democracies. This is not a case of the occasional criminal tax dodger; it is a systemic threat to democracy and our welfare. Tax havens provide opportunities for corruption and theft on a scale that is difficult for us to grasp, and the consequences for people are dire. When barrel bombs are dropped on innocent civilians in Syria, the fuel for the choppers is financed through tax havens. When young girls are sold to slavery, the money is laundered in tax havens. We contribute development aid to African countries, but 10 times as much money is stolen from the very same countries in illegal tax evasion.
It is possible to stop that by introducing stricter international laws and by closing loopholes in our tax codes, but we also need to stop legitimising those States. When national sovereign funds and companies, including Norwegian ones, invest through tax havens, we contribute to the legitimacy of those jurisdictions, which makes it harder for us to criticise and combat others who use the same tax havens for criminal purposes. We as parliamentarians must clean up our home turf and do so now.
Mr DOWNE (Observer, Canada) – I would like to say a few words about the Panama papers. Canada was not shocked by the Panama papers because they were one of many leaks leading to public exposure in Canada. Nine years ago, an exposure in Liechtenstein involved one bank in which more than 100 Canadians had accounts. We found out that more than 20% of that money was tax evasion. After all those leaks – in the Panama papers, 350 Canadians were named – Canadians are well aware of the difference between tax avoidance and tax evasion. The Government announced in the budget in March that it would put in €304 million to fight overseas tax evasion and it also set a target that, in the next five years, it hoped to recoup €1.7 billion. That shows the extent of the problems that Canadians have. The Canadian Government does not have the money for projects that it wants to fund because too much of our money for contributing to Canada is being moved overseas by people who are trying to avoid their taxes.
We fully understand why people want lower tax rates, but as Oliver Wendell Holmes, the American jurist, said many years ago, “Taxes are the price we pay for a civilised society.” We understand that people want lower taxes, but we must all participate in funding our countries. Every country that is represented in this Chamber is losing millions or billions to overseas tax havens. We must fight to close them down and to close down the accounting and law firms that assist people in that regard. Our citizens demand nothing less, and it is our responsibility to do it sooner rather than later. I support the remarks that the rapporteur made when he introduced the topic and I hope that we can take action. Canada is taking action in the budget, as I indicated. We hope that other countries will join us.
The PRESIDENT – I must now interrupt the list of speakers. The speeches of members on the speakers list who have been present during the debate but have not been able to speak may be given to the Table Office for publication in the official report. I remind colleagues that the texts are to be submitted in typescript, electronically if possible, no later than four hours after the list of speakers in interrupted, so before nine o’clock tonight. I remind you that at the end of a current affairs debate, the Assembly is not asked to decide upon a text, but the matter may be referred by the Bureau to the responsible committee for a report.
3. Next public business
The PRESIDENT – The Assembly will hold its next public sitting tomorrow at 10 a.m. with the agenda that was approved this morning.
The sitting is closed.
(The sitting was closed at 5.00 p.m.)
1. Annual activity report 2015 by the Council of Europe Commissioner for Human Rights
Presentation by Mr Muižnieks, Council of Europe Commissioner for Human Rights, of the Annual Activity Report 2015.
Questions: Mr Korodi, Ms Strik, Ms Zelienková, Mr Pritchard, Ms Katrivanou, Mr Rouquet, Mr Ghiletchi,
Ms Pashayeva, Ms Brasseur, Ms Huovinen, Ms Ahmed-Sheikh, Mr Schwabe, Ms Beselia, Mr Csenger-Zalán, Mr Hanžek, Ms Zohrabyan, Ms Mateu, Ms Christoffersen, Ms Kerestecioğlu Demir, Mr Luis.
2. Current affairs debate: the case of the “Panama Papers” and the concern about fiscal, social justice and public trust in our democratic system
Speakers: Mr Schennach, Mr Van der Maelen, Mr Pasquier, Lord Blencathra, Mr Jónasson, Ms Schou,
Ms Dalloz, Ms Huovinen, Ms Rodríguez Ramos, Mr van de Ven, Mr Pozzo Di Borgo, Mr Kandelaki,
Mr Shahgeldyan, Mr Valen, Mr Downe.
3. Next public business
Representatives or Substitutes who signed the Attendance Register in accordance with Rule 11.2 of the Rules of Procedure. The names of Substitutes who replaced absent Representatives are printed in small letters. The names of those who were absent or apologised for absence are followed by an asterisk
Brigitte ALLAIN/Anne-Yvonne Le Dain
Lord Donald ANDERSON/Lord George Foulkes
Paride ANDREOLI/Gerardo Giovagnoli
Ingrid ANTIČEVIĆ MARINOVIĆ*
Anna ASCANI/Tamara Blazina
David BAKRADZE/Giorgi Kandelaki
Gérard BAPT/Jean-Claude Frécon
José Manuel BARREIRO/Teófilo De Luis
Meritxell BATET/ Soraya Rodríguez Ramos
Guto BEBB/Lord Richard Balfe
Levan BERDZENISHVILI/Eka Beselia
Sali BERISHA/Oerd Bylykbashi
Anna Maria BERNINI/Claudio Fazzone
Maria Teresa BERTUZZI/ Francesco Maria Amoruso
Andris BĒRZINŠ/Boriss Cilevičs
Philippe BLANCHART/Dirk Van Der Maelen
Piet De BRUYN/Hendrik Daems
Vannino CHITI/Francesco Verducci
Geraint DAVIES/Liam Byrne
Joseph DEBONO GRECH*
Manlio DI STEFANO*
Francesc Xavier DOMENECH/Ángela Ballester
Daphné DUMERY/Petra De Sutter
Alexander [The Earl of] DUNDEE*
Nicole DURANTON/Jacques Legendre
Mustafa DZHEMILIEV/Andrii Lopushanskyi
Lady Diana ECCLES*
Franz Leonhard EẞL
Joseph FENECH ADAMI*
Cătălin Daniel FENECHIU*
Daniela FILIPIOVÁ/Ivana Dobešová
Axel E. FISCHER
Bernard FOURNIER/Frédéric Reiss
Sir Roger GALE
Xavier GARCÍA ALBIOL
José Ramón GARCÍA HERNÁNDEZ*
Francesco Maria GIRO
Carlos Alberto GONÇALVES
Alina Ștefania GORGHIU*
Sylvie GOY-CHAVENT/Marie-Christine Dalloz
François GROSDIDIER/André Schneider
Emine Nur GÜNAY*
Maria GUZENINA/Susanna Huovinen
Andrzej HALICKI/Killion Munyama
Martin HENRIKSEN/Christian Langballe
Ekmeleddin Mehmet İHSANOĞLU
Michael Aastrup JENSEN*
Frank J. JENSSEN
Florina-Ruxandra JIPA/Viorel Riceard Badea
Marietta KARAMANLI/Pascale Crozon
Niklas KARLSSON/Eva-Lena Jansson
Filiz KERESTECİOĞLU DEMİR
Ksenija KORENJAK KRAMAR/Matjaž Hanžek
Alev KORUN/ Barbara Rosenkranz
Yuliya L OVOCHKINA*
Pierre-Yves LE BORGN'
Jean-Yves LE DÉAUT/Yves Pozzo Di Borgo
Luís LEITE RAMOS
George LOUCAIDES/Stella Kyriakides
Soňa MARKOVÁ/Pavel Holík
Liliane MAURY PASQUIER/Manuel Tornare
Michael McNAMARA/Seán Crowe
Sir Alan MEALE
Ermira MEHMETI DEVAJA*
Ana Catarina MENDES*
Anouchka van MILTENBURG*
Thomas MÜLLER/Jean-Pierre Grin
Hermine NAGHDALYAN/Naira Karapetyan
Marian NEACȘU/Titus Corlăţean
Carina OHLSSON/Azadeh Rojhan Gustafsson
Florin Costin PÂSLARU*
Cezar Florin PREDA
Lia QUARTAPELLE PROCOPIO*
Melisa RODRÍGUEZ HERNÁNDEZ*
Vincenzo SANTANGELO/Giuseppe Galati
Nadiia SAVCHENKO/Sergiy Vlasenko
Nico SCHRIJVER / Mart Van De Ven
Arturas SKARDŽIUS/Egidijus Vareikis
İbrahim Mustafa TURHAN*
Leyla Şahin USTA
Snorre Serigstad VALEN
Nikolaj VILLUMSEN/Rasmus Nordqvist
Draginja VUKSANOVIĆ/Marija Maja Catović
Levon ZOURABIAN/ Mher Shahgeldyan
Vacant Seat, Cyprus*
Representatives and Substitutes not authorised to vote
Lord David BLENCATHRA
Hans Fredrik GRØVAN
Ulises RAMÍREZ NÚÑEZ
Partners for democracy