miércoles, 18 de mayo de 2016

The disputed Commissioner: Cañete involved in new controversies

Publicado en Corporate Europe Observatory
31 de marzo de 2016

Less than 18 months into the job, Climate Action and Energy Commissioner Miguel Arias Cañete is immersed in several scandals.


On April 3rd, three days after publishing this article, Commissioner Cañete came into the media spotlight again due to his wife being among the people listed in the Panama Papers - the scheme revealed by the International Consortium of Investigative Journalists (ICIJ) and the Sueddeutsche Zeitung, of wealthy people using offshore companies often constructed to hide wealth and avoid taxes. Micaela Domecq Solís-Beaumont was empowered by the Panama-based company Rinconada Investments Group (set up in 2005 and active until 2010) to approve financial transactions. Commissioner Cañete did not include this company in his declaration of interests dated 19 September 2014 (nor in the latest one of 14 July 2015)

The Commission's spokeperson Margaritis Schinas affirmed on 4th April that according to the information provided by Commissioner Cañete there is no conflict of interest, as Commissioner Cañete and his wife are married with a separation of property agreements and that his declarations of interests was in line with the code of conduct for Commissionners. He added that the company had been inactive for several years, before the Commissioner took office (though was active when he was holding office in Spain).

Once more Cañete is involved in a scandal related to his and his immediate family's financial interests. For how long will the Commission continue to defend its climate commissioner in the face of major controversy?

Cañete is no stranger to controversy: he was the subject of a 2014 petition by over half a million EU citizens to prevent him from taking office due to his links with the oil industry and the risk of conflicts of interest. Now he faces two more controversies.

Spanish public company Acuamed, managed by the Spanish Ministry of Agriculture, Food and Environment, is being investigated for fraud over the irregular awarding of contracts when Cañete was Minister. The Commissioner is also involved in fresh controversy in his current role, due to the fact that in 2015 he gave the go-ahead for Australian company Berkeley to exploit a uranium mine in Spain. Berkeley is represented in Brussels by Manuel Lamela, who was Cañete's Deputy in the Spanish Agriculture Ministry for three years.

Before his appointment Corporate Europe Observatory (CEO) warned about the dangers of Cañete becoming Commissioner and has exposed his extensive lobby contacts with the private sector during his first year of office. Amidst the lack of coverage in the Brussels media on this story, CEO joins several Spanish civil society organisations and political parties, as well as several MEPs from different political groups in demanding that the Commission investigates both cases, and holds Cañete accountable if evidence of wrongdoing is found.

The Acuamed case and former Minister Cañete

Acuamed, a public water management company under the responsibility of the Spanish Ministry for Agriculture, Food and Environment, has been under investigation since January 2016 by the Spanish High Court for an alleged fraud worth several million euro that took place over several years, also when Commissioner Cañete was Minister (2011-2014).

The Court is investigating irregular contracts awarded by Acuamed to several big construction companies, including Fomento de Construcciones y Contratas (FCC), Acciona, Befesa, Sogecosa, and Altec. The allegations are that those companies received water contracts in exchange for 'presents' such as luxury trips, jobs for relatives or cars for the persons involved. Allegations also suggest that during the construction phase budgets would be 'artificially inflated' by up to ten per cent of the cost, money that would go into the pockets of the construction companies. As MEP Maite Pagazaurtundúa Ruiz (ALDE) explains in her parliamentary question to the Commission, Acuamed “is being investigated for fraud to the tune of almost €27.5 million. [Spanish High Court] Judge Velasco and the Anti-Corruption Public Prosecutor’s Office are examining allegations of fraud in the award of works contracts, and of certificates, invoices and payments being falsified to increase the amounts paid to the successful tenderers.”

The Acuamed contract that points most closely to Commissioner Cañete is the contract to Fomento de Construcciones y Contratas (FCC) for work on the desalination plant of Bajo Almanzora in Almería, Spain. The alleged involvement of the man who is now Climate and Energy Commissioner has moved several MEPs to ask the Commission to explain how it plans to act.

In his parliamentary question of 27 January 2016, Green MEP Jordi Sebastià notes, “A witness has said that the Director-General of Acuamed ordered preference to be given to FCC and indicated that these orders came directly from Miguel Arias Cañete, the current Climate Action and Energy Commissioner who was at that time the Spanish Agriculture Minister.”

Spanish media has extensively covered how according to Eloy Velasco, the judge investigating the case, “top officials at the Ministry agreed an illegal compensation to FCC” for €10 million for the desalination plant and another €40 million for the decontamination of a dam.

This money was agreed as part of the costs to cover flood damage occurred in 2012; El País reports that as Minister, Cañete ignored reports that Acuamed should in fact not cover those costs. Instead, Cañete discussed compensation with FCC at a meeting in February 2014 and ordered the State Attorney to see if it would be legal to pay part of those costs.

Part of these payments were agreed, but according to the judge, Acuamed ultimately refrained from paying the money to FCC once the legal complaint which kickstarted the investigation was made public.

Furthermore, Acuamed had received EU funds from the ERDF (European Fund for Regional Development) and the Cohesion Fund. The fact that the company received EU funding prompted several MEPs and media to ask the Commission whether the EU anti-fraud agency should investigate irregularities in Acuamed's use of EU funding. For instance, MEP Marina Albiol Guzmán (GUE/NGL) affirms in one parliamentary question to the Commission that, “since 2013 it [Acuamed] has been working on a project worth EUR1700 million, a large proportion of which – 'around €1000 million' in 2013 alone, according to the company itself – has been funded by the EU. The Spanish Anti-Corruption Office (Fiscalía Anticorrupción) has discovered that over €20 million of the funding allocated to the project has been siphoned off.”

The Commission referred to the EU funding of Acuamed in a press briefing on 26 January 2016, explaining that it has informed the European Anti-Fraud Office (OLAF) of the issue, making it possible for them to consider opening an enquiry. They also mentioned that as it involves EC funds there is a division of responsibility in terms of management and implementation of the projects and that they are waiting for the correspondent information from the Spanish authorities.

On 7 April, OLAF confirmed to Corporate Europe Observatory that it has analysed the information received on the Acuamed case and opened a coordination case. This means that OLAF will provide assistance to investigations carried out by the Spanish judicial authorities. OLAF added that its assistance is covered by judicial secrecy and that it would therefore make no further comment about the case.

Environmental umbrella group Ecologistas en Acción has already demanded the resignation of Cañete as Commissioner due to his implication in the Acuamed scandal.

Green light for a controversial uranium mine

On 21 May 2015 Commissioner Cañete signed a positive opinion for Australian mining company Berkeley to set up a very controversial open site uranium mine in Spain. Apart from the severe health and environmental risks of uranium mining, the site is located in one of the Special Protected Areas for Birds, part of the Natura 2000 network, under the protection of the Habitats Directive 92/43/EEC….

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