On Thursday 13 November, the EU27 finance ministers will discuss the continuation of financial support to Ukraine in 2026 and beyond, so that the country is in a position to continue the war effort in response to Russian military aggression.
This discussion, which will take place over breakfast, aims to follow up on the request made by the European Council to the European Commission at the end of October to provide financing options (see EUROPE 13737/1). However, the development of a new macro-financial loan (‘Reparation Loan’), which would optimally mobilise Russian public assets immobilised in the EU and which Ukraine would repay only after Russia has paid war damages, remains the central option, even if it was not formally agreed at the European Council.
This solution is “technically feasible and legally and politically desirable”, declared the French minister, Roland Lescure, on his arrival at the Eurogroup meeting on Wednesday 12 November. This is the “most promising” option, as it has “sufficient firepower” and “limits the constraints on national budgets”, noted his Finnish counterpart, Riikka Purra. For Germany’s Finance Minister, Lars Klingbeil, over and above the “legal, political and financial risks”, it is important to make it clear that the EU stands by Ukraine.
Other options for macro-financial assistance to Kyiv include joint EU indebtedness and bilateral loans from Member States.
To implement the ‘Reparation Loan’, guarantees will have to be provided to Belgium, where Euroclear, the central securities depository which holds most of Russia’s assets in the EU, is based. Another challenge is to ensure that the G7 partners, apart from the United States, put together a similar financial package.
Norwegian Finance Minister Jens Stoltenberg was in Brussels on Tuesday, where he will be taking part in an EU/EFTA ministerial meeting on Thursday, indicated that there was “no question” of his country guaranteeing the whole of the Reparation Loan, but did not rule out the possibility of making “a contribution” depending “on what the EU proposes”, he said to NRK television.
ECB. The ministers may also informally discuss the succession of Spain’s Luis de Guindos as ECB vice-president in May next year. Ms Purra praised the “long experience“ of her compatriot Olli Rehn as Governor of the Bank of Finland and former European Commissioner during the euro area sovereign debt crisis.
Taxation of multinationals. Also at breakfast, the ministers will discuss the application of the directive implementing the OECD agreement on minimum taxation of multinational enterprises. This request from certain Member States follows the unilateral decision by the US administration to refuse to adopt this international framework and the agreement allowing the OECD system and the US system to coexist (see EUROPE 13670/7).
For some countries, such as France, there is no reason to question the application of the directive.
ETD. In addition, the ministers will discuss the revision of the Energy Taxation Directive (ETD), with the Danish Presidency of the Council of the EU doing its utmost to reach an agreement by unanimity of the Member States (see EUROPE 13747/31, 13745/12).
“The Presidency of the EU Council has worked hard on the text to take account of the points of view of all the Member States on this fairly complex issue”, a diplomatic source said on Monday 10 November. “There are still a number of outstanding issues, as well as some important and contradictory red lines on the part of the Member States”, the source commented, noting that issues relating to the ecological transition are “increasingly difficult to deal with” in the EU Council.
Among the questions still to be decided are: - the question of indexation of rates, which would begin in 2038 for fossil fuels or 2043 for low-carbon fuels, while being capped at an increase of 8%; - the tax treatment of natural gas, with some countries advocating an extension of the transitional period in view of the contribution of this fossil fuel to the energy transition; - setting the end of 2045 as the deadline for applying reduced taxation to energy products and electricity used in agriculture and forestry; - the end of exemptions for the aviation and maritime sectors in 2035.
To see the Danish compromise proposal: https://aeur.eu/f/jdw
To see the note from the Danish Presidency: https://aeur.eu/f/jdx
Customs. Ministers are expected to reach a political agreement on the removal of the duty-free threshold, which currently allows goods worth less than €150 to enter the EU duty-free.
This measure will apply as soon as the centralised digital platform for closer cooperation between national customs authorities is operational. It will bring within the scope of customs duties the more than 12 million small parcels (65% of total flows) that enter the EU every day, mainly from China. In this way, the ministers hope to combat unfair competition for EU companies and resolve the environmental concerns associated with this phenomenon, since the current system encourages non-EU companies to split up their shipments to avoid these customs duties.
Some Member States and the European Commission will be defending the early abolition of this excess, meaning before 2028. Among them is France, whose minister, Roland Lescure, has expressed the hope that it will be possible to do so “at the beginning of 2026”. Having condemned the excesses of the Shein Marketplace (see EUROPE 13747/2), the French government is pushing for the adoption, on Tuesday, of a political declaration in favour of putting in place a simple and temporary technical solution that will enable the abolition of the customs regime at EU level, if possible in the first quarter of 2026.
This decision by the ministers, to be given legal form at the December Ecofin Council, will incorporate the reform of the EU Customs Code, which has been the subject of a partial agreement in the EU Council (see EUROPE 13669/13) and will be negotiated with the European Parliament at a forthcoming trilogue on Thursday 20 November (see EUROPE 13732/23). The Danish Presidency hopes to conclude this dossier by the end of 2025.
Simplification. The Ecofin Council will quickly touch upon work on regulatory simplification in the light of recent Commission reports (see EUROPE 13735/22).
While France is lobbying for an ‘Omnibus’proposal specific to financial legislation, the Commission and the ECB are working on reports on measures to be taken to increase the competitiveness of the banking sector.
RRF. Without debate, the Ecofin Council will adopt a number of decisions amending the post-Covid-19 recovery plans of the following six Member States: Belgium, Croatia, Estonia, Luxembourg, Slovakia and Romania.
To see these decisions and their appendices: https://aeur.eu/f/jdy
On the fiscal front, the European Fiscal Board will present its annual report, which criticises the Commission’s lax supervision and lack of transparency during the transition period leading up to the application of the revised Stability and Growth Pact in 2024 (see EUROPE 13737/19).
Finally, the Ecofin Council will adopt conclusions on the progress made in implementing the EU’s statistical priorities. (Original version in French by Mathieu Bion and Anne Damiani)