EU Ombudsman questions Barroso’s move to Goldman Sachs

The European Ombudsman, Emily O'Reilly, has called on Commission President Jean-Claude Juncker to clarify the Commission’s position on former Commission President Barroso’s appointment as non-executive chairman and adviser at Goldman Sachs.

O’Reilly has argued that Barroso’s appointment has raised questions over the adequacy of the Code of Conduct.

“Barroso’s move has generated concern at a very challenging time for the EU and particularly in relation to citizen trust in its institutions. This is a significant public interest issue and must be openly and comprehensively addressed by the Commission,” she said, in a letter to Juncker.

““The appointment, which the Commission has argued is in compliance with the Code of Conduct, raises question marks over the adequacy of the Code itself. It is not enough to say that no rules were broken without looking at the underlying spirit and intent of the relevant Treaty article and amending the Code to reflect precisely that. Decisions on breaches of the Code cannot be made solely through a crude calculation of an arbitrary cut-off point for the notification of new positions by former Commissioners. Decisions should more properly be made on a case-by-case basis taking all elements of a particular appointment into account.”

Barroso will be advising the American investment bank on how to mitigate effects from the United Kingdom’s decision to exit the European Union. He was President of the European Commission from 2004 to 2014.

O’Reilly warned that Barroso’s appointment has called into question several issues. She argued that his action has also generated understandable international attention given the importance of his former role and the global power, influence, and history of the bank with which he is now connected.

“The controversy has also given rise to parliamentary questions and I find it particularly relevant that EU staff have also launched their own petition in protest at the appointment,” she added, referring to a petition by anonymous EU staff calling on EU institutions to take “strong exemplary measures” against Barroso.

The petition has now garnered more than 120,000 signatures. Barroso’s move was also criticised by French President Francois Hollande, describing it as “morally unacceptable”.

Critics have said that Barroso’s actions have exposed once again a Brussels "revolving door", in which elite EU officials move to lucrative jobs in business, deploying their inside knowledge and expertise.

O’Reilly warned of the danger of a breach of ethics in his interaction with former colleagues, including the EU’s chief Brexit negotiator Michel Barnier, a former special adviser to Barroso. O’Reilly added that Brexit raised specific issues regarding Barosso’s appointment, given his in-depth knowledge of the Commission and the sensitivity of the issue.

In its public statements, the Commission has said that Barroso’s decision cannot be challenged under EU conflict-of-interest rules, which states that commissioners are obliged to notify the commission of post term-of-office activities 18 months after the former Commissioner’s term of office, due to the fact that this period has already passed since he left Barroso left his old post.

However, O’Reilly argued that Barroso’s case highlighted the “apparent arbitrariness” of the 18-month period and pinpointed the reputational damage that might have been caused by Barroso’s move, even when no rules have been broken.

“The current approach, in certain cases, not alone may fail to comply with the spirit of the law but may also permit a ‘no rules broken’ approach to defending certain appointments that increases rather than decreases public concern. It may also render the Commission less likely to inquire into the wider issues of integrity surrounding a particular appointment.

“Certain cases will not cease to be problematic simply because 18 months or longer has passed. It could therefore be more appropriate for the Commission to decide on the merit of individual cases on a case-by-case basis taking into account all relevant issues and not just the quantity of time that has passed since a Commissioner left office.”