| Welcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union. An EU leaders' summit this week will highlight the brightening outlook for the continent after a very tough year. The latest draft of their joint communique — circulated ahead of a meeting of European affairs ministers today in Luxembourg (where the wording will be finalized) — is full of good news. Leaders will vow to restore free movement and travel, despite the spread of more contagious variants. They'll welcome the progress in deploying the bloc's jointly-funded stimulus and the prospect of a "robust, inclusive and sustainable recovery," according to the draft we've seen. They'll rejoice at the easing of tensions in the Mediterranean, which brought Greece and Turkey to the brink of conflict last summer. Of course, contentious issues that may cause the usual summit drama remain — including migration and paying Turkey for hosting millions of refugees. There's also no agreement on how to move forward on international corporate taxation and the bloc's banking union. The best-case scenario is these issues will be papered over for now, and we'll be spared an all-nighter. After all, summer is upon us. — Nikos Chrysoloras What's HappeningEU Enlargement | Bulgaria won't have an easy time at the meeting of European Affairs ministers today, with its peers increasingly exasperated at Sofia's refusal to permit the formal start of accession negotiations with North Macedonia. With positions remaining entrenched, don't expect any movement. Here's what the row is about. Rule of Law | Ministers will also take stock of the rule-of-law situation in Hungary and Poland, following the latest furor in Brussels with Viktor Orban's crackdown against the LGBTQ community. The real risk for Warsaw and Poland is that the Commission will trigger a sanctions mechanism stripping them of access to EU funds. That's how the new rules will be applied, according to the draft guidelines we've seen. Draghi Stays | Mario Draghi has cemented his position in Italy and his political partners are beginning to assume he'll remain in power until his term ends in 2023. That's the assessment of half a dozen senior officials from all the main parties and inside the government, Chiara Albanese reports from Rome. Spanish Reconciliation | Spain's cabinet is expected to issue pardons today to nine Catalan separatists who were jailed for their role in the illegal independence referendum of 2017. It's a high-stakes gamble for Prime Minister Pedro Sanchez, risking a ferocious backlash from conservatives who are opposed to any kind of reconciliation with the separatists. YouTube Liability | Google's YouTube will find out today from the EU's top court whether it can be held liable for copyright-infringing uploads on its platform. An adviser to the EU's Court of Justice last year said the law doesn't go as far as to hold online platform operators, such as YouTube, directly liable for illegal uploading. In Case You Missed ItFace Recognition | The EU's data-protection watchdogs called for a "general ban" on the use of artificial intelligence to identify people in public spaces, warning of the "extremely high risks" to privacy. The call for action follows new rules proposed by the Commission in April to impose strict limits on the use of facial recognition and other such AI applications. Belarus Sanctions | EU governments agreed to sanction several sectors of Belarus's economy including industries connected to petroleum and the soil nutrient potash, as well as dozens of individuals and entities, as the bloc increases pressure on President Alexander Lukashenko. This is what foreign ministers decided. Price Pressures | European Central Bank President Christine Lagarde said accelerating U.S. inflation, which prompted the Federal Reserve to shift its view of price risks, will have only a limited impact in the euro area. Meanwhile, European natural gas extended its unprecedented rally as supply curbs sent prices to the highest in almost 13 years and stoked concerns over energy inflation. Brexit Divisions | Five years after the knife-edge Brexit referendum, the U.K. remains deeply divided over leaving the EU, a study found. A repeat vote would yield a narrow preference for staying in the bloc, according to the report, which shows how much Prime Minister Boris Johnson still has to do to convince Remain voters of the merits of the move. Dead Seas | Unfortunately, we have bad news for people planning a much-needed vacation. A slimy substance known as "sea snot" from Turkey's Sea of Marmara may spread to adjoining waters rich in marine life along some of Europe's top beaches. While it may be too late to save the Marmara from the thick layer of marine mucilage caused by pollution, authorities are rushing to try and protect the Black Sea and the Aegean. Chart of the Day Swedish Prime Minister Stefan Lofven lost a confidence vote in parliament, toppling his minority coalition and plunging the largest Nordic economy into political chaos. If Swedes are forced to head to the polls early, it would be the first time since 1958. Today's AgendaAll times CET. - 9 a.m. EU General Affairs Council in Luxembourg to discuss Western Balkans, rule of law
- 9:30 a.m. EU top court rules on whether YouTube can be held liable for copyright-infringing uploads
- 10 a.m. EU Trade Commissioner Valdis Dombrovskis, German Chancellor Angela Merkel and Austrian Chancellor Sebastian Kurz take part in conference by German business lobby BDI
- 2 p.m. Press conference following EU-U.S. Justice and Home Affairs ministerial meeting
- Commission President Ursula von der Leyen visits Latvia, Germany and Italy for the next legs of her NextGenerationEU tour
- EU-Montenegro and EU-Serbia Intergovernmental Accession Conference
- Italy's Draghi previews EU summit in Rome parliament
- Spain to issue pardons for jailed Catalan separatists
- Serbian President Aleksandar Vucic is expected to submit a report to parliament about the Brussels negotiations that failed to mend ties with Kosovo
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