Germany’s liberals have done it again.
After causing uproar in Brussels with a last-minute veto on phasing out combustion engines last year, the smallest party in Chancellor Olaf Scholz’s three-party coalition has tripped up another EU law within sight of the finish line.
This time, the Free Democratic Party (FDP) — which has close ties to Germany’s powerful export industry — took aim at proposed rules that would require companies based in the EU to police their value chains for human rights and environmental violations.
Its coalition allies in Berlin are furious, while EU lawmakers, officials, national governments, civil society — and even some businesses — are fed up.
“This is not the first time that Germany has bailed on an agreed compromise due to last-minute FDP opposition,” Lara Wolters, a Dutch Socialists & Democrats MEP leading work on the business supply chain rules in the European Parliament, told POLITICO.
“The result is that European majorities increasingly have to be found without Germany. Germany is thus risking its influence and credibility in Europe.”
The FDP boycott forced Berlin to abstain in a vote that was due to have been held Friday, after Labor Minister Hubertus Heil of Scholz’s Social Democrats admitted that his attempt to sweet-talk the FDP had failed due to the latter’s “ideologically motivated blockade.”
As a result, the Belgian presidency of the Council of the EU postponed the vote — indicating that it has not yet succeeded in rallying enough support among member countries for the law to pass.
Although the final deal — clinched by negotiators from EU institutions in December — made significant concessions to Germany, the FDP subsequently mounted a rearguard action against the supply chain law that flared coalition tensions this week. The SPD and co-ruling Greens both support the law.
The move comes as the liberal party — which has a history of pushing a pro-business agenda during its occasional spells in government — strives to stay relevant ahead of European and German regional elections this year, as well as a general election next year.
In view of the upcoming elections, “the FDP is trying to keep its increasingly skeptical clientele a little more in line,” said Dirk Leuffen, a professor of political science and international politics at the University of Konstanz.
“The entire social discourse has intensified, and we are increasingly seeing this divide between business-friendly and values-based policies,” he added, noting that the FDP, by its own lights, is trying to respond to concerns voiced by industry.
On the brink
The party, which scored around 5 percent or less in all of last year’s German regional elections, is on the brink of political oblivion.
POLITICO’s Poll of Polls shows the FDP with 4 percent support nationally — below the 5 percent hurdle needed to win seats in the Bundestag, and far adrift of its struggling coalition partners. The two main opposition parties, the conservative Christian Democratic Union and the far-right Alternative for Germany, hold the top two spots.
On Sunday the party faces another test as some voters in Berlin head to the polls for a rerun of the 2021 federal election that was declared partly invalid. The states of Saxony, Thuringia and Brandenburg — where the FDP also languishes below 5 percent — hold elections to their regional legislatures later this year.
The postponement of the supply-chain vote further delays a file that’s already under time pressure as policy business in Brussels winds down ahead of June’s European election. For the law to pass in a new vote that could take place as early as next week, some countries now on the fence, especially Italy, would have to vote in favor.
The showdown echoes a similar controversy last year when Germany wielded a highly unusual veto against an EU plan to ban the sale of new cars with an internal combustion engine by 2035.
On that occasion, the FDP insisted on a last-minute exemption for combustion-engine cars that run on synthetic fuels, or e-fuels. A similar dynamic is also now playing out on proposed new EU emissions standards for heavy-duty vehicles.
FDP goes rogue
The party’s strategy is a gamble that is drawing outrage in both Brussels and Berlin — and may well backfire at home, too.
While it may “signal in the short term that the FDP is taking on board the concerns of some parts of society,” it can “come at a price,” Leuffen said.
“If the future procedure then drags on unnecessarily, it can also be at the expense of German industry, which normally has an interest in lean and functioning EU legislation,” he argued.
Without consulting his coalition partners, liberal Justice Minister Marco Buschmann on Tuesday sent a letter — seen by POLITICO — to other EU capitals, outlining why he is pushing for Germany to abstain in the vote.
“The letter from the Federal Minister of Justice was not coordinated with the [Labor Ministry] and is a highly unusual procedure that has also caused astonishment among the European partners,” a labor ministry spokesperson said.
Two Green ministers also weighed in, including Foreign Minister Annalena Baerbock.
“If we break a promise that we have given in Brussels, we will gamble away trust,” she said.
Germany’s abstention reflects the earlier reluctance of its coalition partners to push back harder against efforts by the liberals to kill the law — fearing that infighting would further undermine public support for the country’s ailing government.
“The FDP are putting themselves first, and they are putting their national politics first, which is not a surprise per se,” said Richard Gardiner, EU public policy lead with the World Benchmarking Alliance.
“But what is a massive shock is that it appears the [Social Democrats] and the Greens are doing the same thing,” he added. “If they truly wanted to live up their political ideals and show broad solidarity with a global community like they preach, then they would not tolerate the FDP hijacking the agenda like this.”
Jeremy Van der Hagen contributed reporting. This story has been updated with the postponement of the vote by member countries on the supply-chain law.