Overview
Today's Deep Dive is 1,152 words and a 7-minute read.
The UK government announced that it plans to roll out the new Foreign Influence Registration Scheme (FIRS) next summer, after a protracted delay of the planned 2024 launch. FIRS requires individuals and entities to register arrangements intended to influence UK politics at the direction of foreign governments or political parties. The delay was reportedly to allow the new Labour government time to review the program, which had been revised following concerns from business and civil society groups that it could deter investment and hinder press freedom. The current effort to move forward on its implementation is taking place against the backdrop of domestic concerns of covert foreign influence and espionage and the unfolding story of likely Russian interference in the Romanian presidential elections.
Beyond facing additional compliance requirements in the UK, businesses may face new restrictions and damage to commercial interests and reputational risks, depending on which countries the UK government includes on the more restrictive “enhanced tier” of FIRS. The UK’s FIRS may also be followed by similar measures in the EU and other European states, reflecting growing apprehension around foreign involvement in politics that could complicate the international business environment.
FIRS: Injecting Transparency into Foreign Influence Operations
FIRS creates a register for foreign lobbyists as a measure to strengthen UK national security by rooting out covert efforts directed by foreign powers. Those working on behalf of foreign powers will be required to register their identity, description and purpose of activities, start and end dates and specifics on the entity or foreign power directing the activity, or face criminal prosecution.
Compared to the US Foreign Agents Registration Act (FARA), FIRS is more limited in scope, focused on activities related to influencing decisions and actions of the UK government, political parties and elections at the direction of a foreign power. What constitutes direction by a foreign power is also more nuanced, with control, not funding, a defining element.
FIRS has two tiers: the political influence tier and the enhanced tier. The political influence tier requires registration only when working for non-UK government entities and political parties and does not require registration for work with foreign businesses, charities, think tanks, etc. The registration requirement is within 28 days of entering into an arrangement with a foreign power; non-compliance risks criminal fines and up to two years in prison.
The enhanced tier applies to arrangements with specified foreign powers or foreign entities – a list of which has yet to be announced (or even decided). Persons have 10 days to register under the enhanced tier and the penalties for non-compliance are greater – criminal fines and/or up to five years of imprisonment. Hostile states, such as Russia, Iran and North Korea, will likely be included on the enhanced tier; there is an ongoing debate over China, with security hawks pressing for inclusion, creating challenges for Labour’s “reset” policy towards Beijing.
There are exemptions for news publishers (political influence tier only), diplomats (both tiers) and legal work (both tiers). Unlike FARA, FIRS does not include public communications. The latter is excluded so as to not impinge upon free speech, but it creates a potential loophole which foreign powers can exploit to influence elections covertly through the media – mainstream or social.
Heightened Threat Perception on Risks of Covert Foreign Influence
In the FIRS FAQS, the UK government explicitly states that FIRS is not a register of foreign spies, and registration does not mean the individuals are engaged in undesirable or unlawful activity. Yet, the political context behind the development of FIRS is the growing national security concern that unfriendly foreign powers are seeking to covertly influence British policymaking and elections. A UK government investigation found that Russia interfered in the December 2019 general elections, and there were strong suspicions that Russia influenced the 2016 Brexit referendum. More recently, there have been several cases related to alleged Chinese-controlled agents with close contacts among the British political elite and an associated heightened threat perception of covert foreign influence.
The stakes are high, with covert foreign influence seen as a direct threat to democratic systems. This month, Romania became the first European country to cancel an election over alleged Russian interference. While details are still emerging, the political crisis demonstrates the vulnerability of democratic nations to foreign meddling. With the final results in from the December 6 election, a virtually unknown candidate from the pro-Russian, political far right, Călin Georgescu, won first place, securing 23% of the vote. He ran on a platform of building a self-sufficient Romanian economy, nationalizing foreign companies, ending aid to Ukraine, removing the US missile systems hosted in Romania, and expressed pro-Putin views.
Because he did not win an absolute majority, a run off election was scheduled. Before the run off took place, Romania’s current president, Klaus Iohannis, declassified five intelligence files related to the campaign investigation which found unusual social media activity kicking into high gear two weeks before the election, promoting Georgescu. The messaging focused on social divisions, coordinated misinformation and tapped into economic frustrations and nationalist sentiments, while discreetly promoting pro-Russian positions. While Romanians are strong supporters of Ukrainian sovereignty and deeply skeptical of Russia from their years under the Soviet hammer, the messaging resonated with anti-establishment sentiments.
In a controversial step, the Romanian Constitutional Court annulled the election results in what was arguably an undemocratic action. Georgescu and his allies initiated a lawsuit against the Central Electoral Bureau and several state institutions, seeking to overturn the Constitutional Court’s decision, while threatening the judges with “many years in prison.” While the matter is tied up in the courts, citizens are divided, seeking more proof of meddling and a clearer path on when new elections will be held.
Implications for Businesses
International businesses face a more complex compliance requirement in Europe for lobbying as governments focus on increasing transparency for foreign influence. The UK scheme is still being negotiated and once the “enhanced tier” states are set, businesses may face new restrictions and damage to commercial interests and reputational risks, depending on the outcome of the debate over China’s inclusion.
The UK is not alone in advancing new lobbying rules. Germany amended its Lobby Register Act earlier this year, widening the scope of activities included under their framework. Notably, under the new rules, companies that engage third-party lobbyists are also required to register and more information is required in the registration process, including consulting areas, activities, funding and expenses.
The EU is also focused on minimizing foreign influence and has proposed a new directive to harmonize national rules pertaining to foreign representation by non-EU country governments in EU member states. Individuals funded by non-EU countries or acting as intermediaries would be required to register under the new directive in addition to national registers.
The push for greater transparency into foreign influence operations is likely to gather force, given the larger political context of geostrategic competition and accompanying shifting of alliances and spheres of influence.
