Ireland’s EU Council Presidency is a busy six months with nearly 300 events and a reported 30,000 people due to visit our shores in attendance.
KPMG’s Niall Savage outlines our opportunity to move key decisions forward by being in the hot seat - chairing critical meetings, negotiating with member states and hopefully brokering some critical outcomes.
Ireland’s EU Council Presidency is a temporary privilege; we only get it for six months (so across the current membership) every 13 and a half years.
We need to make it count for Europe and for Ireland, moving well communicated ideas and principles into working policy and legislation. What good looks like for an Irish presidency and Irish businesses could rest in landing two challenging but most importantly achievable objectives - finalising the Union’s long-term budget and bringing EU Inc into life.
The immediate political priority is to secure agreement on the next EU budget (for 2028 to 2034), before it becomes a campaigning matter in domestic politics. This is particularly especially relevant in France, with an election due in April 2027.
The risk with any 27-state compromise is that ambition is watered down to what’s achievable, and what’s possible. There is a clear tension carried forward from the Cypriot presidency, with a number of “Southern” member states campaigning for maintaining a large budget and some of the stronger members in the North seeking significant cuts.
Investment is needed to enable defence spending, much needed supports for business and growth – economic growth naturally but also potential growth in new members. There is tension over funding this through cuts in traditional supports like the Common Agricultural Policy.
For business, a budget agreed this term, with a credible investment platform attached, would be a stimulus for European growth and a job well done by Ireland acting as an honest broker.
While securing a forward-looking budget will give some certainty for business, regardless of outcome, EU Inc (or the 28th Regime) would provide real opportunity to unlock the potential of 450m+ strong EU market.
It is a genuine game changer in reducing the red tape that is slowing down Europe’s entrepreneurs. It is also especially relevant for Irish Companies given the small size of our local market.
The key feature is a single 48-hour digital registration that would allow businesses operate across all 27 member states – so one EU-incorporated structure. For those of us in the detail of such matters, this is pretty radical stuff.
Currently EU businesses (and especially start-ups and scalers) incur enormous cost, and importantly management capacity, establishing complex structures in each country they do business, even if it represents a tiny fraction of their total sales.
For example, a business doing 2% of its sales in Italy, France or Denmark may still need a local company, local directors and an audit. That’s not a functioning single market and EU Inc would be transformative for Irish exporters.
If it is combined with the potential capital market access of the Saving & Investment Union, EU businesses will be given a real boost to complete globally and Europe needs this.
The EU has become excellent at regulating but there’s a lot of regulation as a result. The Draghi report was blunt about the cumulative cost of EU regulation on competitiveness, and the various omnibus simplification packages now working through the system are the direct response.
The Corporate Sustainability Reporting Directive (CSRD) is evidence that the EU can course-correct. Management teams need to focus on growing their businesses, not on complying with regulation that may not be fit for purpose.
These simplification packages target various areas and CSRD shows how effective they can be. The same logic applies to trade facilitation - certification or product categorisation valid in one member state should be valid in all of them.
While we identify the Budget and EU Inc. as achievable priorities, a lot of focus has been placed on digital regulation which will be challenging for an Irish presidency.
The EU has placed a significant focus on regulating AI – the focus needs to turn how businesses can actually make use of it. There are two critical areas EU and Irish SMEs need support on – cost and trust.
One of the bigger fears in the mid-market is that AI becomes cost-prohibitive and larger companies pull further ahead while smaller ones can’t capture the efficiencies. EU-funded schemes – vouchers, clinics and hubs) to assist SMEs to adopt AI cost-efficiently would be welcomed by management teams and avoid repetition of effort and cost.
The second issue is trust. The EU is in a position to mitigate the risk of adoption by simplification – right at the heart of its competitiveness pillar. It could establish a playbook or certification standard for compliant, safe AI use so that management teams and their boards don’t have to independently assess, test and verify everything themselves.
There is a general acceptance that the EU has lost competitiveness across a number of industries and become too dependent on the US, China and other trading blocs without building its own critical infrastructure or capable businesses in key sectors.
EU legislation frowns on state subsidies and the bloc hasn’t invested sufficiently in developing what used to be called national champions and are now really EU champions.
Europe needs to stop being a net importer in critical sectors, especially energy, because that underpins everything from data centres to cooling infrastructure supporting cloud services.
Ireland has strong data centre capability but we’re losing ground on location due to energy supply and cost factors. Ireland is an island with wind, wave and solar potential and we could become a much stronger net energy producer and pair that capacity accordingly.
The value of holding the EU Presidency is setting the legislative agenda and chairing the meetings. Success should be measured by agreed documents in play, not themes or good intentions.
The test for this Presidency is whether at the end of it there’s a multiannual framework agreed, EU Inc in force, and deliverables in the form of what was agreed and signed rather than what was discussed.
That’s the standard Ireland should be judged against - and the one it should set for itself.
Ireland's EU Presidency will help shape the future direction of Europe.
To discuss how this could impact your organisation, get in touch with Niall Savage; we'd be delighted to hear from you.
Partner, Head of Private Enterprise, National Chairperson of Audit Committee Institute
KPMG in Ireland
