G7 Summit

Nein to Corporate Spying

Seeking for a job through the binoculars
Peek a boo, I see you.

German business groups are pressing leaders of the G7, a governmental forum of seven major economies in the world, to agree not to conduct industrial espionage on each other.

“I would hope that it would be possible to set up a process for all G7 participants to clearly position themselves against industrial espionage and for an appropriate self-restraint,” Eric Schweitzer, the president of German Chamber of Commerce and Industry, the DIHK, told Tagesspiegel. “To restore trust, I believe the German government needs to make a clear statement about taking action against industrial espionage.”

Corporate spying is not formally on the agenda of the two-day G7 summit to take place over the weekend at Schloss Elmau, near Garmisch-Partenkirchen in southern Germany.

The government leaders of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States plan to discuss a range of other issues, including the conflict with the former G8 member Russia, the threat of Islamic terrorism, and the situation in Yemen. Chancellor Angela Merkel would also like to include the Ebola epidemic, while some discussion of the ongoing talks with Greece also seems unavoidable.

But business leaders at the very least hope the controversial subject of spying will be discussed on the sidelines.

“What needs to be clarified with the intelligence service will be clarified.”

Angela Merkel, German Chancellor

The scale of the spying cooperation between the United States and Germany has unleashed a political brawl in Berlin, testing Ms. Merkel’s “Teflon” talent to shake off controversy.

The chancellor is under attack for refusing to allow the list of NSA targets, known as “selectors,” or names, search terms and IP addresses of individual computers, to be made public or even given to a parliamentary committee looking into the NSA’s activities. The targets of this corporate espionage allegedly included Airbus, previously called European Aeronautic Defense and Space, or EADS, and helicopter maker Eurocopter.

Berlin and Washington continue to hold talks about whether to release this information to German parliamentary control and investigation committees.

Critics also say officials in Ms. Merkel’s government lied about the prospects of a U.S.-German “no-spy” deal before the 2013 election.

In an interview with the newspaper Süddeutsche-Zeitung, Ms. Merkel referred to her earlier remark that “friends shouldn’t spy on each other” as a “political statement.” She described it as an essential “principle” that she still views as “important.”

Ms. Merkel reiterated that Germany needs to work closely with the U.S. intelligence forces for security reasons but added that “if we can draw lessons from the past, we will.”

The German industry lobby group DIHK believes a no-spy agreement would help ease the growing tension between the United States and Germany over the corporate espionage scandal and support the difficult negotiations over a free-trade deal between the United States and European Union known as the Transatlantic Trade and Investment Partnership, or TTIP.

“We need to do everything” to keep these two partners negotiating, Mr. Schweitzer said. “Anything else would not be in the interest of our country.”

Merkel handy mobile phone Source DPA 38860977
Ms. Merkel’s own mobile phone was hacked by U.S. intelligence agents. Source: DPA

 

Ms. Merkel said the recent revelations about industrial espionage are not clouding the TTIP talks between the United States and Europe. “What needs to be clarified with the intelligence service will be clarified,” she said.

The chancellor hopes that a free-trade agreement can still be reached while President Barack Obama is in office – by the end of 2016 at the latest. “Otherwise, there will be a long pause,” she said.

In addition to a no-spy agreement, some German industry groups would also like to see Russia return to the G7 governmental forum.

“A G7 plus Russia could contribute to constructive steps in the Ukrainian crisis,” Eckhard Cordes, chairman of the Committee on Eastern European Economic Relations, said in an interview with newspaper Welt am Sonntag. The organization is supported by several associations representing German business, including the Federation of German Industries, the Association of German Banks, the German Insurance Association, and the Foreign Trade Association of the German Retail Trade.

Over the weekend, G7 finance ministers meeting in Dresden agreed to take action against corporate tax evasion. One of the measures calls for collaboration of national tax authorities.

German Finance Minister Wolfgang Schäuble said multinational corporations could expect to be audited by teams of international controllers in the future.

“International collaboration in the area of taxes leads to more fairness,” Mr. Schäuble said at a press conference following the Dresden meeting.

For the past two years, the Organisation for Economic Cooperation and Development, the OECD, has been working on new rules to prevent globally operating companies from shifting their profits to avoid taxes.

The project, know Base Erosion and Profit Sharing, or BEPS, is to be finalized by November for the G20 countries to vote on.

Kevin Hoffmann is an editor with Tagesspiegel. John Blau is a senior editor with Handelsblatt Global Edition. Donata Riedel covers economic policy for Handelsblatt in Berlin. To contact the editors: redaktion@tagesspiegel.de, blau@handelsblatt.com and riedel@handelsblatt.com

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