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Reform of The German Lobby Register: Numerous Measures to Tighten Regulations from March 2024

Reform of The German Lobby Register: Numerous Measures to Tighten Regulations from March 2024

The Lobby Register Act has been in effect in Germany for nearly two years, and the related register has been a hot topic since its inception. The objective is to monitor who is attempting to sway political decisions and legislation, and by what means. The “Act amending the Lobby Register Act”, approved by the German Federal Council at the end of 2023, will take effect on March 1, 2024. It brings significant changes for lobbyists, particularly concerning the obligation to disclose financial information.

Reveal interactions with employees and committees

Previously, interest groups were only obligated to notify bodies, members, parliamentary groups, or groups of the German Bundestag and the Federal Government. The Amendment Act now also includes interest groups in relation to committees. This reflects the fact that key political decisions are debated in committees and specialized committees, and corresponding resolution recommendations are prepared by these and then sent to bodies, members, parliamentary groups, or groups of the German Bundestag.

Interest representation towards employees of protected groups will also be considered as interest representation under the law from March 1, 2024, and unit heads will also fall within the scope of application. It is evident that existing “back doors” of lobbying are to be shut. Naturally, this also implies that efforts to influence indirectly, i.e., on employees who can significantly affect MPs’ decision-making process, will now require registration.

Who needs to register in the lobby register?

The Lobby Register Act continues to impact numerous organizations. At the start of 2024, almost 6,000 lobbyists had registered in the lobby register. These are not only well-known large corporations that invest substantial sums in representing their interests. Smaller associations, foundations, and other nonprofit organizations may also be obligated by the Lobby Register Act to register in the lobby register. This is because the Act initially covers anyone who contacts the aforementioned groups in the Bundestag “with the intent of influencing the decision-making process”.

Establishing contacts is to be interpreted broadly: Even the deliberate distribution of flyers in front of the Reichstag building with corresponding political demands can be considered as making contacts under the Lobby Register Act and consequently trigger a registration obligation. To avoid risking hefty fines of up to EUR 50,000, it is advisable to comply with this. Only a few are exempt from the registration obligation. However, these include – among others – churches and employers’ organizations.

All funds of EUR 10,000 or more must be disclosed

Particularly concerning the specific obligation to disclose various financial information in the lobby register, there are some changes for lobby representatives. Whereas it was previously possible to refuse to disclose information on personal financial expenses and the funds received in their entirety and still engage in lobbying activities, this option will be entirely eliminated when the amending law takes effect on March 1, 2024.

In the future, lobbyists will have to disclose any funds received, mostly donations from public institutions or private donations, in the lobby register from a minimum amount of EUR 10,000, whereas the relevant limit was previously EUR 20,000.

However, there is a limitation, at least concerning donations from private individuals or private sector organizations: these only need to be disclosed if they also exceed at least 10 percent of the total amount of donations received in the relevant financial year. This is designed to prevent, for instance, the personal data – the law requires the disclosure of surname and first name – of private individuals who donate significant sums to large charitable organizations from being publicly accessible on the internet.

Only donors who contribute a substantial portion of an organization’s total donations and could potentially influence its political activities should be identified.

Data disclosure for membership fees over EUR 10,000

The future will see a more rigorous examination of the membership fees of interest representatives. The revised law dictates that the total sum must be reported in increments of EUR 10,000. The data of individual members whose membership fees exceed EUR 10,000 in the relevant financial year and, like donations, make up more than 10 percent of the total sum of all membership fees, must also be revealed. The objective is clear: donations disguised as membership fees should not remain opaque.

Changes in the lobby register also affect NPOs

Numerous nonprofit organizations are already listed in the lobby register. The representation of interests of private-law organizations with public-interest tasks constitutes about one fifth of the organizations in the lobby register. These include nonprofit organizations and foundations. Therefore, the tightening of the lobby register is also crucial for NPOs.

In addition to the already listed information, the number of association members must be broken down into natural persons and legal entities in the future. Nonprofit organizations that are already registered must also comply with the updating obligations, which are subject to fines.

Essential mandatory information, such as

  • Master data,
  • Legal representative, or
  • The names of the individuals directly responsible for representing interests,

must be updated promptly rather than quarterly. This means that the corporate body must make updates without unnecessary delay. Failure to make the required updates will result in inclusion in the list of former lobbyists after six months, at which point the individuals involved will be subject to the ban on lobbying subject to registration.

WINHELLER examines your status in relation to the lobby register

The revised law introduces numerous changes to the lobby register. The primary change is that it will no longer be possible to decline to provide financial information, which is intended to promote greater transparency but will also place a significant additional burden on all those affected. A complete and correct entry in the lobby register is becoming increasingly challenging, particularly for smaller organizations, while they are the ones most affected by the high fines. It is therefore essential to thoroughly analyze the issue of lobbying, examine your own activities and, if in doubt, register in the lobby register. We are here to assist you! Please contact us at any time with your questions.

Continue reading:
German Lobby Register: Registration Obligation For All Lobbyists

Dr. Constantin Goette

Dr. Constantin Goette specializes in corporate law and advises on corporate governance, directors' and officers' liability and compliance issues.

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