‘Corrosive’: Commission rejects greater revolving doors transparency

The controversial 2024 move of a senior EU antitrust official to a private law firm will for now remain shrouded in secrecy, the European Commission has said, despite formal warnings that the revolving door of staff to the private sector had a “corrosive” effect on public trust.  

The departure of Henrik Morch, a director from the Commission’s competition department DG COMP to Paul, Weiss earlier this year led to a blistering report from EU ombudsman, Emily O’Reilly, who said that such events fed euroscepticism and undermined EU interests.  

In a letter published on Tuesday (24 September), EU Human Resources Commissioner Johannes Hahn said he had “no legal basis” to comply with O’Reilly’s demand to publish details of restrictions placed on Morch’s work at his new employer.  

“The restrictions imposed on the former DG COMP senior official’s post-service employment … will be disclosed as part of the next annual report,” due in the first part of 2025, Hahn said in the letter dated 5 August, brushing off O’Reilly’s request to publish “without delay”. 

“The former DG COMP senior official’s post-service employment was assessed thoroughly, in a proportionate way and on its own merits,” Hahn added. 

The Commission said it was now obliging former staff to publicly declare that restrictions had been imposed, but they won’t have to detail exactly what they are.  

In principle, ex-staffers may face a cooling-off period or be barred from accepting certain clients, and those involved in particular legal cases aren’t ever allowed to work on them from outside, the letter added. 

In this case, the Commission implemented internal rules “in a sound manner with a view to preventing any risk of a real, potential or perceived conflict with the Commission’s legitimate interests,” Hahn said, adding: “The European Ombudsman has not found any single instance of maladministration, as part of her latest three inquiries” on the topic.

The move of Morch after 30 years at the Commission was announced in an 8 May press release, in which New York-based Paul, Weiss cited his “extensive experience” in handling merger cases as a benefit to clients, prompting a furious reaction from O’Reilly.  

“The clear impression is that the Commission has allowed one of its senior officials to work for a non-EU company that anticipates major benefits from that inside knowledge,” O’Reilly said in a May statement. In previous inquiries she has lamented that many of the staff restrictions ordained by the EU are in practice impossible to monitor or enforce.  

O’Reilly is expected to formally close the Morch case tomorrow, without making further formal proposals, but this isn’t the first such controversy to cross her desk.

Her attention was also drawn to the cases of Carles Esteva Mosso, a deputy director-general at DG COMP who become an antitrust partner at Latham & Watkins, and that of Adam Farkas, executive director of the EU’s banking agency, who moved to head lobby group the Association for Financial Markets in Europe.

The issue is also likely to be in the news again as many of the executive’s 27-strong College of Commissioners are due to depart when a new mandate begins later this year – and there’ll be significant attention on where they head to.

The 2016 move by former Commission President José Manuel Barroso to US banking behemoth Goldman Sachs drew significant criticism, leading to a reform of the Commission’s Code of Conduct.

Paul, Weiss did not immediately respond to a request for comment.