Two national officials working on 2007-2013 strategy page ...

Animal health NEW TREATY Interview
Member states cautious over Ratifications could start Two national officials working on
2007-2013 strategy Page 6 in December Page 11 the Eureka initiative Page 20

EUROPOLITIcs

The European affairs daily Tuesday 23 October 2007 N° 3398 35th year

Focus Competition Table of Contents
Microsoft agrees to EU’s
Delay on ETS interoperability conditions 
revision confirmed
By Nathalie Vandystadt  Instance, which confirmed the Commis-
By Anne Eckstein sion’s analysis on the abuse of dominant
The European Commission is closing position and its record fine of €497 mil-
a chapter in the case pitting it against lion (see Europolitics 3373). Microsoft
The revision of the EU’s Emission Trad- Microsoft for nearly a decade. After has already paid the bill. “This judge-
ing Scheme (ETS) is at a standstill.
The European Commission, which “almost daily” contacts in recent weeks ment sets a precedent” with regard to the
with the group’s
had planned to present its proposals CEO, Steve
for a revision of the mechanism on 5
December, has decided to postpone Ballmer, Com-
petition Com-
its presentation, probably until 23 missioner Neelie
January 2008. The proposals were to
be part of a package that also includes Kroes obtained
satisfaction on
burden sharing by the EU member the morning of
states for future leregdisulcattiiovensproofpoCsOa2l
emissions and a 22 October. She
announced the
setting renewable energy objectives. news to the press
For Commission spokesperson
Barbara Helfferich, this decision is within hours.
The US soft-
anything but surprising, given the ware giant has
“extreme complexity” of the matter.
The initial date of 5 December was a finally agreed to © MaxPPP
comply with the
“particularly ambitious” target, she interoperability Kroes: “There is no more reason to impose any further fines on Microsoft”

added. That said, however, this delay requirements set by the EU executive in firm’s future market behaviour, noted the
looks like a faux pas in the run-up to
the 13th Conference of Parties to the its competition decision of March 2004. commissioner.
In other words, the Redmond-based Microsoft also accepted the interoper-
Convention on Climate Change and group will have to provide its competi- ability conditions imposed by Commis-
the Kyoto Protocol, which opens on
4 December in Bali (Indonesia). The tors with all the technical information sioner Kroes. Developers of open source
required for the development of software software will now have access to its infor-
European Union, which intends to for work group server operating systems mation. Royalty rates will be cut to a
keep its leadership on combating cli-
mate change, wanted to show with (business IT networks) compatible with nominal one-time payment of €10,000.
its Windows operating system. Royalties for a worldwide license includ-
its new ‘climate and energy’ package Until today, Microsoft had fought the ing patents will be slashed from 5.95% to
that it is earning its leadership role.
The least that can be said is that it has many injunctions by the EU executive 0.4% of earnings on the licensed prod-
ordering it to cease its unfair competition ucts, or less than 7% of the royalty origi-
missed the boat.... practices. On 17 September, Microsoft nally claimed by Microsoft, explained

lost its case before the EU Court of First the commissioner. (continued on page 4)

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ISSN 1811-4121

EUROPOLITICS N° 3398 Tuesday 23 October 2007

Contents N° 3398

Top Stories NEW TREATY Interview
Ratifications could start Two national officials working on
Animal health in December Page 11 the Eureka initiative Page 20
Member states cautious over
2007-2013 strategy Page 6

Business & competitiveness Financial services, banks, Purchase of Ingersoll Rand
insurance by Doosan cleared.................................18
Competition: Microsoft agrees to Acquisition of Alcogroup approved.......18
EU’s interoperability conditions  ............1 Financial crisis management: Purchase of Nord Est by 21
Internal market: Furniture Merkel, Sarkozy and Brown Centrale Partners cleared......................18
moved, but house still there....................4 schedule spring appointment..................9
Research and development: Creation Interview
of a European Research Area to Social affairs
become the main goal.............................5 with two national officials working
Space: Commission gets clear Health: Subsidiarity, the cornerstone on the intergovernmental Eureka
mandate for space policy initiatives........5 of EU health action................................... 10 technological research initiative
“The two programmes, ARTEMIS
Sectoral policies Institutions and ITEA 2, are complementary”.........20

Maritime policy: Satisfied CPMR Treaty of Lisbon: Ratifications
welcomes blue paper ..............................6 could start in December already...........11
Animal health: Member states Committee of the Regions: CoR
cautious over 2007-2013 strategy............6 becomes a politically reinforced entity.... 12
Climate change: Airlines and EU/Poland: EU welcomes pro-EU
Parliament not on same wavelength.......7 Civic Platform’s election victory ..........12
Climate change: Portugal’s 2008-2012
quota allocation plan adopted.................7 Enlargement
Structural Funds: Commission finalises
adoption of Luxembourg’s NSRF ............. 7 Enlargement: New treaty gives member
Justice and Home Affairs: Ireland states an exit clause for first time.............. 13
to participate in measures to freeze
terrorist funds...........................................8 Defence & security

Defence: Defence policy is
enshrined in new treaty.........................14

Economic & monetary affairs, In Brief
taxation
Serafina buy of Intelsat approved..........15
EMU: EU government deficit Cooperation against
down in 2006...........................................8 cigarette smuggling................................15
EU/IMF: Still no Union voice Panel of ‘wise men’ to
on voting reform......................................8 study future of EU.............................15
Taxation/Customs union: Solana to meet new Iran negotiator......18
Commission amends regulation Blackstone’s takeover
on duty-free allowances............................... 9 of Hilton cleared...................................18

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Tuesday 23 October 2007 N° 3398 EUROPOLITICS

Microsoft impose any further fines on Microsoft,” hope that will be the case, but I am sure
said Kroes. She nonetheless stressed that Microsoft will react on its side.” As
(continued from page 1) that “the technical documentation must for new cases, the commissioner said
The group claims 31 protocols with pat- evolve as products evolve”. she and her services were still closely
ents, of its 154 protocols. involved and that their work would bene-
The next step fit consumers. She again said the Micro-
Last March, the Commission had It remains to be seen what will be soft case was “unique” – the group con-
threatened to impose additional fines on trols 95% of the software market. “Size,
Microsoft, saying the prices it planned decided with regard to “past unreason- sector, nationality and market share are
to charge for the interoperability infor- able pricing” singled out in the statement unimportant for me. What counts is the
mation were totally “unreasonable” (see of objections addressed to Microsoft consumer,” she commented, adding that
Europolitics 3259). Microsoft had already last March. The commissioner said she this 22 October is a very important day
paid a second fine of €280.5 million hoped to reach a decision “as soon as pos- for consumers all over the world. “For
imposed in July 2006 for having failed to sible,” but gave no further details. Micro- years, the consumer has been the victim
provide “complete and accurate” techni- soft could be liable for daily penalties of of a fool’s bargain. As from today, there
cal information allowing interoperability up to €3 million. will be more competition on the infor-
of its Windows system with competitors’ mation technology market,” concluded
products. Neelie Kroes also commented that she the commissioner. n
does not expect Microsoft to appeal the
“As of today, there is no more reason to ruling of the Court of First Instance. “I

Internal market

Furniture moved, but house still there

By Dafydd ab Iago Alan Riley, an EC competition law profes- were needed to finally adopt a proposal
sor at City University in London, argues for the European company statute. Ger-
Time will tell to what extent Competi- that without the competition principle as hard Huemer, director for economic and
tion Commissioner Neelie Kroes is correct one of the key interpretative articles of the fiscal policy at craft and SME association
in summarising the reform treaty as merely treaty, the development of competition law UEAPME, makes no artificial distinction
shifting furniture around, whilst leaving and EU competitiveness will suffer. “The between internal market issues and other
the house intact. Kroes is, of course, not fundamental development of competition matters. He heckles continued unanimity
referring to the replacing of the words law into hitherto protected sectors and its in taxation, whilst welcoming further EU
‘common market’ by ‘internal market,’ but ability to limit the impact of state interfer- competence in Justice and Home Affairs.
to the removal of the words ‘free and fair ence on the competitive process will be “Citizens moving around freely will help
competition’ from the preamble. Accord- compromised,” he argued. the internal market,” said Huemer. “As
ing to Kroes, integrating competition into long as you have unanimity on taxation,
the concept of the ‘internal market’ clarifies Time will tell who is right on how the we will remain far away from being able
that one cannot exist without the other. The Union’s shared competence to establish an to support the internal market effectively.
Internal Market and Competition Protocol internal market will develop. This compe- Harmonising rules on VAT, for example,
as a legally binding confirmation ensures, tence is first set out in Article 3 by noting that is blocked, even though this would be very
believes Kroes, undistorted competition as the Union “shall work for the sustainable beneficial for SMEs,” said Huemer.
an integral part of the internal market. development of Europe based on balanced
economic growth and price stability, a highly BusinessEurope sees major general
“This means that the present legal situa- competitive social market economy, aiming advantages from an EU with more efficient
tion, which has prevailed for over 50 years, at full employment and social progress, and functioning and greater legal personality,
is maintained,” explained Kroes, replying a high level of protection and improve- greater use of qualified majority voting and
to a parliamentary question by MEP Søren ment of the quality of the environment”. more stable Presidencies, as well as with a
Bo Søndergaard (GUE-NGL, Denmark) Additionally, under Title 1, Article 22a, the strengthened external dimension under the
on the consequences of the omission of Union “shall adopt measures with the aim of high representative for foreign affairs and
‘free and fair competition’ from the pream- establishing or ensuring the functioning of security policy. General conditions sur-
ble of the draft Treaty of Lisbon. “Competi- the internal market, in accordance with the rounding the internal market are also seen
tion is the best means to preserve the inter- relevant provisions of the Treaties”. as being strengthened by greater institution-
nal market and to protect consumers. The alisation of the Eurogroup and an increased
protocol, which will form an integral part At the Association of European Cham- role for the Commission with respect to the
of the reform treaty and which will have bers of Commerce and Industry (Euro- Stability and Growth Pact. More specifi-
the same legal value as Treaty provisions, chambres), Director of Legal Affairs cally, the European employers’ federation
acknowledges this,” added Kroes. However, Catherine Pham does not expect major also welcomes the legal basis provided for
changes. “But I hope for an accelera- intellectual property rights and the recogni-
tion of procedures with the reform treaty tion of the role of social partners and the
reducing the time to adopt legislation,” Tripartite Social Summit. n
said Pham. She points to the 25 years that

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EUROPOLITICS N° 3398 Tuesday 23 October 2007

Research and development

Creation of a European Research Area to become the main goal

By Jim Brunsden the measures necessary for the implementa- concern the free movement of workers.
tion of the ERA. This is a new legal base, Article 40 provides for the co-decision
The most noticeable change contained in which is not contained in the title devoted procedure to be used for the adoption of
the draft Treaty of Lisbon (the reform treaty), directives or regulations in this area.
as regards research and development policy, The EU already has the
is the establishment of a direct legal base for ability to act on CONTINUITY 
the building of a European Research Area. Other legal bases for R&D policy will not
ERA-related issues 
The new Treaty on the Functioning of significantly change under the new treaty.
the EU states that the EU should build a to research and technological development The EU will continue, once the treaty comes
European Research Area (ERA) in which in the EC Treaty (Title XVIII). into force, to have a multi-annual framework
“researchers, scientific knowledge and tech- POLITICAL IMPETUS  programme to fund R&D activities. The
nology circulate freely”. This concept of the various elements of this, such as the specific
ERA, a term not mentioned in the existing The nature of this change, however, programmes and the rules of participation,
EC Treaty, is a broader idea than the goals is not as dramatic as might first appear. will continue to be adopted using the same
previously set out for the EU in R&D policy. The establishment of a direct legal base types of legislative procedures as before (eg
The goals set out in the EC Treaty are focused for actions to build the ERA may well co-decision, consultation). Article 171 of the
more narrowly on the need to promote cross- provide a political impetus. However, the EC Treaty, which allows the EU to set up
border cooperation between businesses, EU already has the ability to act on ERA- Joint Undertakings (such as the proposed
research institutes and universities. related issues using legal bases found in Joint Technology Initiatives) will remain
other parts of the EC Treaty. Legislative unchanged. The same applies to Article
The new treaty also states that the Euro- measures relating to researchers’ mobility, 169, which provides for the Commission
pean Parliament and Council can, using for example, could already be proposed on and groups of member states to carry out
the ordinary legislative procedure, adopt the basis of Articles 39 and 40 TEC, which joint research programmes. The voting pro-
cedures for these kinds of initiatives will also
be the same as before. n

Space

Commission gets clear mandate for space policy initiatives

By Jim Brunsden No specific article on space exists in the base from Article 156 of the EC Treaty
current EC Treaty. As a result, under the (relating to Trans-European Networks),
Space will be recognised, in the draft reform treaty, the European Commission and which is being examined under the
Treaty of Lisbon (reform treaty), as an area will have for the first time a clear mandate co-decision procedure.
in which the EU has a shared competence to propose initiatives in this policy area.
with its member states. The importance of this change, however, PROGRAMME 
should not be overestimated. There is The new treaty will state that the mea-
Article 172a of the new Treaty on the already a European Space Policy. It was
Functioning of the EU gives the Union drawn up by the Commission and the sures to be adopted by Parliament and
a clear mandate to take initiatives. The European Space Agency (an intergovern- Council, to implement the Space Policy,
article states that the EU shall draw up a mental body with 17 member states: the may take the form of a ‘European space
European Space Policy. To achieve the old EU15 + Norway and Switzerland), programme’. This is also nothing new.
goals of this policy, it may “promote joint and approved by the Space Council (a An early draft of this programme was pre-
initiatives, support research and techno- joint meeting of the EU Council of Min- sented by the Commission at the same
logical development and coordinate the isters with relevant ministers from Norway time as the Communication setting out
efforts needed for the exploration and and Switzerland) in May 2007. Equally, the Space Policy (SEC(2007)504). The
exploitation of space”. the EU already has legal bases it can use programme will be a detailed implemen-
to take initiatives related to space policy, tation plan for the Space Policy, and the
Measures in this area will be adopted and has used them. final version is set to be adopted by minis-
by the European Parliament and Coun- ters in autumn 2008.
cil using the ordinary legislative proce- Examples of legislative proposals from
dure, but cannot involve any harmonisa- the Commission include the proposal for Taking this into account, the strongest
tion of the laws and regulations of the a regulation on the further implementa- change that one can anticipate is that,
member states. tion of the European satellite radio navi- because of Article 172a, the Commission
gation programmes EGNOS and Galileo will have a clear authority to propose mea-
(COM(2007) 535), which takes its legal sures related to space policy, without first
seeking a request to do so from Council. n

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Tuesday 23 October 2007 N° 3398 EUROPOLITICS

Maritime policy

Satisfied CPMR welcomes blue paper 

By Anne Eckstein in Florence about “frustrations” while presenting a mission, these rules are not, are barely,
primary analysis of the document. On or are badly respected. Finally, the
It is with satisfaction tainted with frus- the positive side, he notes the acknowl- delegates regretted that the European
tration – even worry – that the maritime edgement of the concepts of the Euro- Commission does not plan to create a
regions welcomed the publication by pean maritime space and of integrated specific directorate-general: any self-
the European Commission of its blue maritime policy, as well as the proactive respecting policy needs a management
paper on the EU’s Maritime Policy. nature of the blue paper, which proposes body, all the more when it is a ques-
29 actions. tion of an ‘integrated’ policy for which
“The maritime policy is not an end in coordination is essential.
itself, and the process begun today is only Also considered as important advances:
the start,” responded Fisheries and Mar- that the social and employment dimen- Joe Borg noted these worries and indi-
itime Affairs Commissioner Joe Borg, sions are taken into account, along cated that the Commission would pres-
during a debate dedicated to this topic with safety and maritime surveillance, ent, in 2008, a road map and guidelines
on 19 October by the General Assem- maritime transport, energy, research, for national maritime policies, on the
bly of the Conference of Peripheral clusters, dismantling of ships, tourism, condition that the regions identify what
Maritime Regions of Europe (CPMR), and the environmental section. As for best suits them.
which took place in Florence (Italy). “frustrations,” he notes the insufficient
“We cannot do everything all at once. position granted to regions, the absence The Maritime Policy and the action
That’s impossible,” he added, asking of management for maritime basins and plan are to be taken, he says, as a “tool
the regions to show patience. A mes- of long-term perspectives (the goal is box,” which member states, regions and
sage which was well received, accord- currently set for 2009) and unanswered local authorities can draw on, and invites
ing to CPMR President Claudio Mar- questions on the funding of this new them to assume their responsibilities. As
tini, for whom they must not drag their policy. for the financial question, Borg admitted
feet to pass from speeches to acts under that it will have to be broached during
pain of arousing more disenchantment These concerns were widely shared the review of the financial perspectives
regarding Europe, and to announce the by the national delegates, in particular in 2009, and that eventually the new
appointment of a working group respon- concerning the application of the sub- policy will have to have its own budget
sible for the day-to-day follow-up of sidiarity principle, “which must not only heading.
implementing the new policy. be devolved to member states, but more
to regions and local authorities”. Several Portuguese Secretary for State for
In content, the future Maritime Policy questions were also raised concerning Defence and the Sea Joao Mira Gomes
as proposed represents an “important the need to take into account the reali- said that his government would actively
step forward even if the blue paper is ties and specific needs of the islands and continue the work: a ministerial con-
below the hopes aroused by the green to rigorously apply the rules. ference takes place on 22 October in
paper of June 2006,” said Jean-Yves Le Lisbon - an interministerial meeting
Drian, president of the Brittany region of The Baltic Region is protected by charged with preparing a position for
the CPMR, who did not hesitate to talk numerous conventions but, stressed the Council, to be supported during the
the representatives of the Baltic Com- European Council in December. n

Animal health

Member states cautious over 2007-2013 strategy

By Luc Vernet cific study on this matter, which will be of the Community that it was necessary
presented by the end of 2008. to reinforce the sanitary safety of imports
European Commissioner for Health into the Union.
Markos Kyprianou presented, on 22 Beforehand, Commissioner Kyprianou
October in Luxembourg, to agricul- intends to propose to member states an The main argument raised by sceptical
ture ministers of the EU27, his draft action plan in the field of animal health. member states regarding the draft aiming to
Community strategy for animal health It will constitute a first step before the control the bulk of EU actions on prevention
(2007-2013). drafting of a framework law integrating came from Belgium. This member state is on
aquaculture, he specified. This legisla- guard over the risk of seeing breeders, if they
Faced with criticisms formulated by tive act should allow everything to be are not compensated at 100%, not alerting
several member states regarding the idea, collected in a single text, like it was the public authorities as quickly as possible
at the centre of his text, of sharing the done for the regulations on food. The in the case of a disease affecting their farm.
cost of management of epizootic crises Community framework constituted till For its part, the Portuguese EU Presidency
with professionals through insurance and present multiple texts principally dating announced its wish to reach, before the end
mutual funds, the Cypriot commissioner from 1988-1995. Furthermore, the com- of the year, a consensus among the EU27 on
indicated that he was going to lead a spe- missioner agreed with certain countries conclusions regarding the strategy. n

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EUROPOLITICS N° 3398 Tuesday 23 October 2007

Climate change

Airlines and Parliament not on same wavelength

By Anne Eckstein ered for a General Assembly in Madrid hope to reduce emissions by a further 25%
on 19 October, the position adopted on 3 in the next 15 years. It reiterates the efforts
Though it accepts the principle of October by the EP’s Environment Com- already made in terms of improvements in
participation by the air transport sector mittee (see Europolitics 3385)1 would cost technology and operations, investments in
in the European Emission Trading the sector some €160 billion over the next modern fleet and a more efficient use of
System (ETS) as a “useful” instrument ten years, if the European Union acted European air space. “If Europe wants to
to manage airplane emissions, the Asso- unilaterally. That would probably result, it take the lead in the aviation and environ-
ciation of European Airlines (AEA) believes, in a barely measurable reduction ment debate, it must come up with a prac-
nonetheless refuses to follow those who, aindCevOas2taetminigsseioffnesctg,lnoboat lolynlbyuotnitEwuirlol pheaavne ticable and non-discriminatory scheme,
within the European Parliament, “seem carriers’ financial stability but also on eco- and not shoot itself in the foot with a
to be more interested in penalising nomic growth and tourism, especially in system that will punish its own carriers,”
European airlines and their passengers the new EU member states. insists the association. n
than in the environmental benefits such
a system might deliver”. The AEA stresses that, taking account of (1) Vote planned for November’s plenary
the renewal of their fleets, member airlines session.
For the leaders of this association, gath-

Climate change

Portugal’s 2008-2012 quota allocation plan adopted

By Anne Eckstein cerns, inter alia, the coherence of plans with their annual allocation. Finally, considering
meeting the Kyoto commitments of the EU that the purchase of Joint Implementation
On 22 October, the European Commis- and the member states, actual verified emis- (JI) and Clean Development Mechanism
sion approved, under conditions, Portugal’s sions, and technological potential for reduc- (CDM) credits by public authorities will be
proposed national plan for allocating TCraOd2- ing emissions, non-discrimination, and EU a key measure for the achievement of Portu-
emission allowances for the Emission competition and state aid rules. To this end, gal’s Kyoto target, the Commission specifies
ing Scheme (ETS) from 2008 to 2012. This the Commission is asking the Portuguese that the maximum amount of allowances
plan provides for an authorised allocation authorities for certain changes to their plan, that it approved is based on a thorough scru-
of 34.8 million tonnes of tConOn2e,sw(h3.i1c%h )isina including supplying the necessary informa- tiny of Portugal’s intention to set up a dedi-
decrease of 1.08 million tion on how Portugal will treat new entrants cated carbon fund and invest a minimum
relation to the initial proposal from Lisbon and on the fact that the maximum overall value of €348 million from 2007 onwards
(35.9 million tonnes). amount of Kyoto project credits (emission- for the purchase of such credits. n
The Commission evaluates allocation saving projects carried out in non-EU coun-
plans against twelve criteria set out in the tries under Kyoto Protocol rules) which may (1) Directive 2003/87/EC, modified by Directive
directive establishing the ETS1 which con- be used may not represent more than 10% of 2004/101/EC.

Structural Funds

Commission finalises adoption of Luxembourg’s NSRF

By Isabelle Smets operational programmes that each country According to the new regulation relat-
may implement. Negotiations between the ing to European Structural Funds, 60% of
A ceremony for the signature of Lux- Commission and member states are now expenditure in the countries and regions
embourg’s National Strategic Reference continuing on the operational programmes, resulting from the ‘convergence’ objective
Framework (NSRF), which describes how which describe more specifically the invest- must be allocated to the priorities following
this country will invest the €65.27 million ment priorities of the states. More than one from the Lisbon Strategy. This figure rises
granted by the 2007-2013 Cohesion Policy, third of the 450 operational programmes to to 75% for the ‘competitiveness’ objective.
took place on 22 October in Luxembourg. be implemented in this programming period According to the Commission, these objec-
The document was officially adopted by the have already been approved by the Commis- tives have been reached, since its evaluation
European Commission on 8 October. sion. From the moment of this adoption, it of the NSRF demonstrates that 62% of the
is up to the member states – and, if neces- investments associated with the objective of
The Commission has finalised the adop- sary, the regions – to select the thousands of convergence and 77% of those associated
tion procedure for this country’s National projects which will originate each year and with the objective of competitiveness will
Strategic Reference Framework (NSRF). which will benefit from support in accor- be allotted to the priorities following from
NSRFs define the investment strategies of dance with the EU’s Cohesion Policy. the Lisbon Strategy. n
each member state and propose the list of

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Tuesday 23 October 2007 N° 3398 EUROPOLITICS

Justice and Home Affairs

Ireland to participate in measures to freeze terrorist funds

By Jim Brunsden to pick and choose which JHA measures to or economic gains”. Although the UK will
participate in (known as an ‘opt-in’) should officially keep its ‘opt-in’ power concerning
Ireland has made it clear that it will par- not apply to measures designed to freeze Article 67a measures, in reality it has also
ticipate in all EU measures to freeze terrorist terrorist funds. As a result, Ireland will be stated its intention (in Declaration No 52 of
assets, under the new draft Treaty of Lisbon. expected to participate in the adoption and the new treaty) to participate in all of them.
implementation of such measures on the
A new provision has been added to the same basis as other member states. The EU’s In another declaration (No 54), also added
protocol on the position of the UK and competence to carry out such activities will since the draft version of the treaty was pub-
Ireland in the area of Justice and Home be set out in Article 67a of the new Treaty lished, Ireland notes that it can, at any time,
Affairs (No. 4), since a draft version of the on the Functioning of the European Union. decide to completely give up its right to pick
treaty was published on 5 October. This This article states that the European Parlia- and choose which JHA measures it partici-
provision, added at the request of the Irish ment and Council, acting by co-decision, pates in. The Irish government states that it
government, makes it clear that its power “shall define administrative measures with intends to carry out a review, within three
regard to capital movements and payments, years after the new treaty enters into force,
such as the freezing of funds, financial assets to assess the extent to which it still needs to
retain its special opt-in/opt-out abilities. n

EMU

EU government deficit down in 2006

By Christophe Garach Denmark (+4.6%), Finland (+3.8%), Esto- and from €6,929,011 million to €7,151,270
nia (+3.6%), Bulgaria (+3.2%), Ireland million between 2005 and 2006.  
According to an Eurostat report released (+2.9%), Sweden (+2.5%), Spain (+1.8%),
on 22 October, the government deficit sig- Luxembourg (+0.7%), Netherlands (+0.6%) Specific amendments: Eurostat has
nificantly decreased in the eurozone and and Belgium (+0.4%). In all, 21 member amended the deficit and debt data notified
in the EU27 for 2006. In the eurozone, states recorded an improved government by Belgium for 2005 and 2006 in relation
the government deficit decreased by 1% in balance relative to GDP in 2006 compared to the assumption by government (FIF
absolute value, from 2.5% of GDP in 2005 to 2005. Conversely, the government debt – Fonds de l’infrastructure ferroviaire) in
to 1.5% in 2006. In the EU27, it fell from (in million euro) increased both in the euro- 2005 of the debt of the railway company
2.4% to 1.6%. In 2006, the largest govern- zone and in the EU27: although, expressed SNCB. Eurostat has amended the deficit
ment deficits in percentage of GDP were as a percentage of GDP, the figures have data notified by the United Kingdom for
recorded by Hungary (-9.2%), Italy (-4.4%), decreased (from 70.3% to 68.6% for the consistency of recording of UMTS licences
Portugal (-3.9%), Poland (-3.8%) and Slova- eurozone and from 62.7% to 61.4% for the proceeds. n 
kia (-3.7%). In contrast, ten member states EU27), the volume of debt has risen, from
registered a government surplus in 2006: €5,677,221 million to €5,801,886 million The Eurostat document is available at 
ec.europa.eu/eurostat

EU/IMF

Still no Union voice on voting reform

By Brian Beary in Washington  states made separate declarations on how the most dynamic economies, many of which
IMF’s voting system should be reformed. G7 are emerging and transition economies”.
The lack of an EU stance in the ongoing finance ministers (France, Germany, Italy,
move to reform voting quotas at the Inter- the United Kingdom plus the US, Japan and CURRENCY EXCHANGE RATES 
national Monetary Fund was evident at Canada) said it “should better reflect [...] the Elsewhere, Monetary Affairs Commis-
the annual meeting of the IMF’s Financial growing weight and role of dynamic mem-
Committee in Washington on October 20. bers, many of which are emerging markets”. sioner Joaquin Almunia gave a somewhat
Italy’s Finance Minister Tommaso Padoa- downbeat economic forecast, saying the “out-
Schioppa, who chaired the meeting, said Finland, Denmark, Sweden, Estonia, look for the next two years appears less favour-
afterwards “the EU has only one money – it Latvia and Lithuania backed “a tripling of able than before the financial turbulence”.
should consolidate”. But he admitted it was basic votes” for low-income countries. Italy, Almunia said the weak US dollar – it hit a
“difficult” legally because some of the issues Malta and Portugal said “we are ready to record low of US$1.4304 against the euro on
on the IMF’s agenda fell outside the EU’s consider to go beyond their doubling”. Bel- 19 October – was causing “headwind”. The
remit.  “We did not discuss that today,” he gium, Austria, the Czech Republic, Hun- weak Chinese yuan was mentioned too, with
said. Instead, various groups of EU member gary, Luxembourg, Slovakia and Slovenia G7 ministers urging an “accelerated appre-
backed “a higher calculated quota to the ciation” of its exchange rate. n

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EUROPOLITICS N° 3398 Tuesday 23 October 2007

Taxation/Customs union

Commission amends regulation on duty-free allowances

By Christophe Garach goods below that amount. For land travel to import duties1; 2. the list of annexes
(including inland waterways), the allow- enumerating the goods that may be
Following on from the Ecofin Coun- ance is set at €300. The recasting of the imported duty-free and that are not sub-
cil’s political agreement of 28 November directive will enable the member states to ject to quantitative limits (equipment
2006 for revision of Directive 69/169/ for the blind, educational, scientific and
EEC on duty-free allowances for travel- Technically, duty-free cultural products, among others).
lers (see Europolitics 3196), the Euro- allowances concern
pean Commission has now adopted an VAT and excise duties In contrast with the amended direc-
amended implementing Regulation normally levied on goods tive, which had to be adopted unani-
(918/83) under the written procedure. brought in by travellers mously in Council, the implementing
The reform (set to enter into force on 1 entering European regulation may be adopted by a qualified
January 2008) is tied to the enlargement majority of the finance ministers (Article
of the Union. It aims to simplify regu- territory 26 of the EC Treaty on customs union).
lations and customs clearance. Techni- In all likelihood, the regulation will be
cally, duty-free allowances concern VAT reduce further the duty-free allowance for approved under the written procedure
and excise duties normally levied on travellers under age 15 (except for tobacco before the end of the year. n
goods brought in by travellers entering and alcohol, where the minimum age is
European territory. set at 17). The states may also lower the The amended regulation is available at
thresholds if travellers have their primary www.europolitics.info/web/external-file/
As suggested in the Commission’s ini- residence in border regions (within a pdf/gratuit_en/210330-en.pdf
tial proposal, the final agreement by the radius of 30 km of the border) or if they (1) Items used as evidence or for similar
finance ministers provides for two cases, are border-region workers. purposes in courts or other official bodies of
depending on the means of transport used. the member states; also concerned are several
For air and sea travel (inland waterways The amended regulation also con- types of sound recording equipment used for
are excluded), an allowance of €430 is set, firms: 1. the list of items not subject the transmission of information.
with passengers not having to pay taxes on

Financial crisis management

Merkel, Sarkozy and Brown schedule spring appointment

By Christophe Garach an important role in the development of be a question of analysing in detail the
a global response to these events,” under- issue of the liquidity of financial institu-
The management of financial crises line the three signatories. tions. The subject is not new: currently,
will certainly be one of the topics on the supervision relies on the solvency ratio
agenda of the spring European Coun- The letter proposes six axes for reflec- of financial bodies. The idea is to add
cil. In the margins of the recent Lisbon tion, on which the three heads of state a new parameter based on a liquidity
summit, Germany, France and the estimate that it would be necessary to act ratio which would allow for a better
United Kingdom signed, on 19 Octo- more quickly and more effectively even if appreciation of the financial situation of
ber, a joint declaration requiring the it means implementing new regulations institutions.
European Commission and the Ecofin and even if several proposals result from
Council to present to the heads of state international negotiations. It should be 2. The letter also insists upon the
and government in March 2008 a full noted that, in substance, the majority of “transparency of the contingent liabili-
progress report on work related to the the suggestions are not exactly innova- ties of banks”. This lack of transparency
management of financial crises.  tive: whether they concern the “role of partly explains the financial crisis of this
the evaluation agencies” or “the proper summer.
To recall, an impressive road map was circulation of information on operations
already ratified during the last Ecofin of securitisation and other structured 3. Lastly, it calls for the acceleration of
Council (see Europolitics 3386 and 3390) financial products,” these suggestions the debate on cross-border cooperation
and an initial meeting scheduled for the already appeared in the working docu- and the management of financial crises.
spring summit. But the German chancel- ment devised by the Economic and
lor, the French president and the British Financial Committee. The letter ends with a commitment:
prime minister clearly wanted to give the three signatory countries proclaim
more urgency to this work than previ- The joint letter by the three heads their intention to implement the five
ously anticipated. “Faced with the recent of state does, nevertheless, linger on recommendations of the Financial
turbulence, [...] as a global financial several points: Stability Forum on funds in order to
market, the European Union should play provide a boost: careful banking stan-
1. In connection with the evalua- dards (Basel II), liquidity, securitisation,
tion of complex financial tools, it will evaluation and operation of funds. n

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10 Tuesday 23 October 2007 N° 3398 EUROPOLITICS

Health

Subsidiarity, the cornerstone of EU health action

By Nathalie Vandystadt terms of public health in the EU,” said position of DG Health and Consumer
an EU source following the European Protection was very clear: it called for an
The EU’s reform treaty has gone slightly Council of 22 and 23 October, which extension of its legal mandate because the
further in addressing public health paved the way for the new document. current Article 152 had become insuffi-
than the current legislation. However, The Danes blocked what they considered cient. “With laws on the safety of blood
member states have seized the opportu- to be a ‘transfer of sovereignty’. Thus the and human tissues already in place, it
nity to underline the subsidiarity princi- new treaty does not contain what was the had no scope to propose health laws,”
ple, which characterises this field. That main innovation in the Constitutional says this source.
is to say that the 27 insist that they will
only confer upon the EU the power to The term ‘human health’ Still according to this source, the arti-
legislate where they feel they themselves has been replaced by cle ‘public health’ in the defunct Con-
would be less effective. Europolitics had ‘physical and mental stitution was drafted with precaution,
provided much the same analysis based health’ such that it might be interpreted to cover
on the proposal submitted by the Portu- contagious diseases like AIDS, a flu pan-
guese EU Presidency at the Intergovern- Treaty, under Article 152 (public health): demic, tuberculosis, but also non-conta-
mental Conference (IGC) for a reform measures pertaining to “monitoring, gious diseases, such as obesity or cancer.
treaty, which replaces the rejected EU early warning of and combating seri- It could have also addressed alcohol and
Constitution (see Europolitics 3358 and ous cross-border threats to health” have tobacco, among others. “The cross-border
3336). This remains true after the EU been relegated to a paragraph that calls aspect of these diseases is such that they
heads of state and government, attending for “promoting measures”. Above all, affect all member states to some degree.
an informal summit on 18-19 October this paragraph rules out “any harmoni- Therefore effective measures cannot be
in Lisbon, approved the reform. Under sation of the laws and regulations of the taken strictly at the national level,” says
‘definition and implementation of policy member states”. this expert. Public health protection with
and action’, the EU has taken onboard regards to tobacco and alcohol, how-
the demands concerning the protection In the Constitutional Treaty, which ever, was also included in the paragraph
of human health. was rejected just two years ago by France excluding any harmonisation in the
and the Netherlands, these provisions Constitutional Treaty. This of course is
The EU’s objective is to reach “a high were included so that measures could be unchanged in the reform treaty.
level of health care” for Europeans. The established, in the case of shared com-
term ‘human health’ has been replaced petences between the EU and member “Continuation”
by ‘physical and mental health’. The EU states, to face common safety concerns Nevertheless, according to the Com-
now gives due attention to these issues, by (quality and security standards for organs
way of two green papers, one on mental and substances of human origin, blood mission, this is not a step back but rather
health, the other on healthy diets and and blood derivatives, veterinary and phy- a “continuation,” allowing it to act in
physical activity. The  new treaty states that tosanitary measures aimed specifically at favour of public health. Although it
the EU “encourages cooperation between public health protection, etc) Harmonisa- would have welcomed, with some enthu-
member states” in order to “improve the tion would therefore have been possible siasm, the possibility of harmonisation in
complementarity of health services in with regards to monitoring serious cross- the face of cross-border threat, the Com-
cross-border areas”. The text encourages border threats to health. But, according mission still believes that the new treaty
“in particular initiatives aiming at the to an EU source, for Copenhagen “the brings improvement.
establishment of guidelines and indica- transfer of competences means ‘no una-
tors, the organisation of exchange of best nimity’, hence ‘harmonisation’, which Measures setting high standards of
practice, and the preparation of the nec- implies directly a transfer of sovereignty, quality and safety will be extended to
essary elements for periodic monitoring and therefore a referendum”. cover medicinal products and devices
and evaluation. The European Parliament for medical use under the co-decision
shall be kept fully informed”. This will dash certain hopes. “Since procedure (Council plus European Par-
Danish reservations 2004, nobody is in a position to explain to liament). A declaration, however, clari-
me what type of law might hold the carrot fies that these measures must respect
However, unlike in other sectors, public – the incentives – but not the stick – the “common safety concerns”.
health has lost ground when compared to possibility of coercing member states,”
the defunct Constitution. “To get Den- said a Brussels-based public health con- Furthermore, their objective is to
mark onboard without a referendum, we sultant. He adds that during the Intergov- set high standards of quality only if
had to recall the current dispositions in ernmental Conference negotiations over “national standards within the single
the Constitutional Treaty in 2004, the market cannot afford a high level of pro-
tection for human health”. This is but
another manifestation of subsidiarity,
a principle so crucial to member states
when it comes to the health of their
citizens. n

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EUROPOLITICS N° 3398 Tuesday 23 October 2007 11

Treaty of Lisbon

Ratifications could start in December already

By Célia Sampol referendum despite the different views from determine whether this is in fact the case. In
within his coalition. 2005, Denmark was meant to hold a refer-
The European Union has a new treaty. endum on the draft Constitution but it was
However, it still has to be ratified by the 27 France will also ratify the treaty in par- subsequently cancelled when the whole rati-
member states, some of which may even liament. The President, Nicolas Sarkozy, fication process was suspended. Denmark
hold referenda. argues that the text is in fact nothing more also voted ‘no’ in the first referendum on the
than a treaty amending the previous trea- Maastricht Treaty in 1992.
Thus far, only Ireland has announced, ties and therefore does not require public
through Prime Minister Bertie Ahern, that approval. The French government intends As for the British, nothing is sure. The
it will hold a referendum. This is hardly a to launch the ratification process of the sim- Labour Prime Minister, Gordon Brown, has
surprise since the Irish constitution requires plified EU treaty on 14 December, the day mentioned repeatedly that it is not necessary
a referendum before ratifying EU texts. The after the date scheduled for the signing of the to hold a referendum because the new treaty
referendum is expected to take place in May treaty, announced the French Prime Min- does not contain any major changes and
or June 2008, although it may be postponed ister, Francois Fillon, on 21 October. The more importantly, all the ‘red lines’ requested
since this date coincides with another ref- government also plans to propose the text to by the United Kingdom have been respected.
erendum on ‘children’s rights’. And even the Constitutional Council before submit- He is, however, under a lot of pressure from
though the leader of Fianna Fail (the centre- ting it to the two chambers in parliament, Eurosceptics in England, who have not forgot-
right nationalist group) has said that he will which would then be expected to adopt it ten the promise made by Tony Blair (Brown’s
do everything in his power to ensure a large in the same terms, so that it can be ratified. predecessor) that any future EU treaty would
‘yes’ majority, Bertie Ahern may well be dis- However, the government will have to win be put to the people for approval. This group
appointed. The Irish ‘no’ vote in the first ref- the support of the opposition if it wishes to is mounting a strong campaign, calling for a
erendum on the Treaty of Nice in 2001 has have a three-fifths majority in parliament. referendum with support from the Tories as
not been forgotten. The leader of the Socialist Party, Francois well as certain labour supporters. Brown is
Hollande, has said that his party would therefore keen to proceed with the ratifica-
The two countries which voted ‘no’ in “adopt a responsible attitude,” although he tion as soon as possible before the campaign
2005 to the draft EU Constitution will not has doubts as to whether the ratification really gains momentum. According to one
be organising referenda this time. Following will be possible in December and is leaning British diplomat, the aim is to ratify the text in
the advisory opinion issued by the Council more towards January or February 2008. the first half of 2008.
of State, the Dutch government decided
on 21 September not to organise this type The British question mark For the rest, Poland and the Czech Repub-
of ballot on the grounds that the new EU And then follow all the unknowns. The lic, which were both hesitant during the
treaty had no impact on the national consti- negotiations on the treaty, are not expected
tution. The Prime Minister, Jan Peter Balk- first is Denmark, which may be tempted to to organise referenda although a final deci-
ende, has always been strongly opposed to a hold a referendum. Its national constitution sion is still pending. All countries want to
specifies that any transfer of sovereignty must ratify the text as soon as possible so that it can
be approved by the people. Legal experts are come into force on 1 January 2009, bringing
therefore busy examining the new treaty to to an end all the institutional reforms. n

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12 Tuesday 23 October 2007 N° 3398 EUROPOLITICS

Committee of the Regions

CoR becomes a politically reinforced entity

By Isabelle Smets In concrete terms, can we accept a deluge ing its composition. A new provision (Article
of pleas against acts which would violate the 256a, Paragraph 5) also gives the possibility of
The Committee of the Regions (CoR subsidiarity principle? This would not be in reviewing “the nature of the composition” of
- Articles 256-263 and 265 of the Treaty on the interest of the CoR. For Jordi Harrison, the Committee “at regular intervals, to take
the Functioning of the Union) can be satis- the head of the cabinet of President Michel account of the economic, social and demo-
fied with the new treaty. Since its creation Delebarre, pleas should even be “extremely graphic changes in the Union”. It will act,
in 1994, every review of the treaties has rein- rare”. But in the CoR, they are not refusing then, on a proposal from the Commission.
forced it powers and refined its political role. to show their pleasure and they believe that
This time has not been an exception to the this new power makes its opinions more Like today, the members of the CoR will be
rule. Certainly, the committee remains... a credible. Thanks to work which, according named by the Council, deciding by qualified
committee; it is not becoming an EU insti- to Harrison, should be organised in advance, majority. But their term in office increases
tution, in the legal sense of the term, as it at the moment that legislation is being pre- from four to five years, to come into line with
has asked again and again since its creation. pared. “If we succeed in organising ourselves those of the Parliament and the European
But it obtains new rights: the right to be able at that moment, we could put forward an Commission. The president and his office
to directly refer to the EU Court of Justice opinion which could be better understood, will be appointed for two and a half years
in case of a violation in the subsidiarity prin- because there is this sword of Damocles. I (currently two years). Symbolically, the CoR
ciple, at least concerning the texts for which think that we will gain in influence.” – which asserts loud and clear its role as a
it is necessarily involved in (it is the new political entity – welcomes office terms being
protocol on subsidiarity which grants it this As the Nice Treaty already states, the made equal. Just like the reinforcing of rela-
right) and the right to revert to the Court to number of members of the CoR cannot tions with the European Parliament which, as
defend its own prerogative (new Article 230, exceed 350, plus an equal number of substi- was already the case for the Commission and
Paragraph 3). tutes. Conversely, the number of represen- the Council, receives the power to summon
tatives per country will no longer be fixed the CoR and moves into the ranks of the insti-
in the treaty. It is the Council of Ministers, tutions which must consult it. For the Parlia-
unanimously deciding on a Commission ment, consultation of the CoR was until now
proposal, which will adopt a decision regard- only a possibility (though widely used). n

EU/Poland

EU welcomes pro-EU Civic Platform’s election victory

By Joanna Boguslawska-Kania won 41.64% of the vote and PiS 32.04%. been increasing the number of his demands
This would translate into 208 seats out of the towards his EU partners, fiercely demand-
The European Commission has hailed 460-seat parliament for PO and 164 seats for ing that the Ioannina compromise be legally
the results of the 21 October elections in PiS. Only two other parties which passed binding, threatening otherwise to veto the
Poland, expressing its confidence in future the electoral threshold of 5% will join PO adoption of the Reform Treaty and under-
“fruitful cooperation” with the new govern- and PiS in parliament: the Polish Farmers mining initiatives such as the European day
ment in Warsaw. The pro-EU liberal party Party (PSL), which is the Civic Platform’s against the death penalty, which enjoyed full
Civic Platform (PO) won the elections. preferred coalition partner, and the Left and support among other member states.
Democrats coalition group (LiD). PSL is
“I would like to emphasise the impor- likely to secure 35 seats and LiD will most Leaders across Europe were clearly
tance of Poland’s contribution to the Euro- probably obtain 52. Former junior coalition relieved at the outcome of the elections.
pean Union and the European spirit of the partners the anti-EU League of Polish Fami- The leader of the Socialist Group in the
Polish people,” said European Commission lies (LPR) and the populist Self-Defense European Parliament, Martin Schulz, said
President José Manuel Barroso in a state- (Samoobrona) party faced a crushing defeat that the people in Poland “have sent a clear
ment on 22 October. He also sent a “per- in the elections. Neither party will be in message that Poland’s future lies in working
sonal message” to Donald Tusk – the leader parliament after securing 1.28% and 1.54% closely with their European friends rather
of the Civic Platform and the candidate for of the vote respectively. Voter turnout was than adopting anti-European positions at
the prime ministerial post – congratulating nearly 54% - the highest result since 1989. virtually every opportunity”. A government
him and expressing his hope for a positive headed by Tusk is expected to play a calmer,
engagement by the new government towards a sigh of relief more co-operative role within the EU. “The
the EU. Preliminary results indicate that the Although only in power for two years, the Platform now has to ensure that Polish poli-
ruling conservative Law and Justice Party tics is led back to the heart of European inte-
(PiS) led by Prime Minister Jaroslaw Kaczyn- government led by PiS leader Jaroslaw Kac- gration and away from the margins that PiS
ski has been heavily defeated by the liberals. zynski had earned a reputation as a difficult has pushed it into,’’ PO Deputy Chairman
Based on an unofficial count of 90.87% of partner for the EU. Driven by nationalistic Bronislaw Komorowski said shortly after the
the ballots cast across the country, PO has interests, Kaczynski has, in recent months, results of the elections were announced. n

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EUROPOLITICS N° 3398 Tuesday 23 October 2007 13

Enlargement

New treaty gives member states an exit clause for first time

By Joanna Boguslawska-Kania to show “commitment to promoting such Although the Copenhagen criteria are in
values together”. To date, under Article 49, fact enshrined in the treaties already in force,
Despite growing ‘enlargement fatigue’ would-be member states had to “respect the they do not directly refer to the accession
among EU citizens following the ‘big bang’ principles of the EU” such as liberty, democ- process. Some countries feared that putting
enlargement in May 2004 and the smaller racy, respect of human rights and fundamen- the Copenhagen criteria directly into the
scale enlargement in 2007, EU leaders have tal freedoms and the rule of law. Moreover, article governing enlargement procedure
decided not to toughen up accession crite- countries wanting to become members will would mean that they would come under
ria for potential newcomers. But for the first have to notify not only the Council but also the EU Court of Justice’s jurisdiction, allow-
time in the history of European integration the European Parliament and national parlia- ing non-EU states to challenge the EU.
they have decided to give member states the ments of their application for accession. The
right to withdraw from the Union. Although national parliaments will not, however, have A mechanism for negotiation
to date none of the current members has any role in further stages of the accession Article 35 of the reform treaty will confirm,
publicly stated its intention to leave the EU procedure. Experts say that these changes
(and the queue to join the EU is still a long are only “cosmetic” and do not create any for the first time, that any member state may
one), the Union is now equipped with a additional requirements towards potential decide to withdraw from the EU. This would
legal mechanism making it possible not only newcomers. They do, however, point to the be done in accordance with that country’s
to join but also to exit the EU. new sentence which has been added at the own constitutional requirements. The new
end of the article, which says that “the condi- treaty sets out a mechanism for negotiation
Following ten months of discussions on tions of eligibility agreed upon by the Euro- and conclusion of such a withdrawal agree-
the new treaty, focusing, inter alia, on future pean Council shall be taken into account”, ment with the other member states.
EU enlargement, member states decided as something more than just a minor change.
only to slightly change Article 49 of the According to Piotr Kaczynski, a researcher No special political criteria have been
Treaty on the EU (TEU), which defines the at the Centre for European Policy Studies attached to this procedure. The member
conditions of eligibility and the procedure of (CEPS) in Brussels, this new requirement state has to notify the European Council
accession to the Union. enables the EU to expand the current so of its intention and then negotiate arrange-
called ‘Copenhagen criteria’ by adding new ments for its withdrawal. The withdrawal
According to the new Article 34 of the draft enlargement conditions, namely integration agreement is then concluded on behalf of
Treaty of Lisbon, accession countries will capacity. The wording of Article 34 falls short the Union by the Council, acting by a quali-
have to respect the EU’s ‘values’ as defined of the expectations of France or the Nether- fied majority, after obtaining the consent of
in the 2004 IGC rather than its ‘principles’. lands, which wanted the accession criteria to the European Parliament. From the date
They will need to respect the “values of be much stricter. The Netherlands insisted of entry into force of the withdrawal agree-
the inviolable and inalienable rights of the on including the Copenhagen criteria in the ment, the treaties cease to apply to the state
human person, freedom, democracy, equal- main body of the new treaty to make them in question. The state, which has withdrawn
ity and the rule of law” and will be obliged legally binding on countries seeking acces- from the Union is, however, allowed to apply
sion. This proposal was, however, rejected. again for membership. Such request is sub-
ject to the accession procedure referred to in
Article 34 of the reform treaty. n

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14 Tuesday 23 October 2007 N° 3398 EUROPOLITICS

Defence

Defence policy is enshrined in new treaty

By Nicolas Gros-Verheyde has no jurisdiction over defence matters the other member states shall have an
(Article 240a TFEU). “obligation” of aid and assistance “by all
Along with the foreign policy of which the means in their power”. This obliga-
it is an inherent part, defence policy has Member states’ different views and dif- tion does not affect the “specific charac-
been given a prominent place in the ferent military capacities explain these ter” of the security and defence policy
reform treaty, a promotion from its virtual safeguards. The treaty mentions reser- of certain member states (neutral or
non-existence in previous treaties. It also vations, moreover, and the necessity of bound by special agreements) or NATO
has a new name: the European Security preserving the autonomy of NATO, in agreements (Article 27(7) TEU).
and Defence Policy (ESDP) has been particular at the request of Britain.
renamed the Common Security and Solidarity clause. “The Union and
Defence Policy (CSDP). As established But the repeated ambition is “the pro- its member states shall act jointly in a
by the Intergovernmental Conference in gressive framing of a common defence spirit of solidarity if a member state is
2004, ‘Petersburg’ military-civilian tasks policy that might lead to a common the object of a terrorist attack or the
are enlarged, certain financial means are defence” (Article 11 TEU). The tran- victim of a natural or man-made disas-
put into place, relations between states sition to a common defence shall be ter. The Union shall mobilise all the
are clarified (common defence clause decided by the European Council instruments at its disposal, including the
and solidarity clause) and intervention acting unanimously; it will recom- military resources made available by the
mechanisms are refined (groups of states, mend to the member states to adopt a member states.” This clause may be used
permanent enhanced cooperation and decision in accordance with their own to prevent the terrorist threat, to protect
European Defence Agency). Since some constitutional rules (Article 27(1) TEU) democratic institutions and the civilian
of these provisions (EDA and enlarge- population and to assist a member state
ment of Petersburg tasks) have been ENLARGED TASKS “at the request of its political authorities”
implemented in advance, the most note- Definition. The mission assigned to (Article 188 R TFEU). It is implemented
worthy innovation is permanent struc- by a decision adopted by the Council,
tured cooperation, a sort of avant-garde the Union is to ensure “an operational on a joint proposal from the Commis-
or core group of countries wishing to take capacity drawing on civil and military sion and the high representative. Where
European defence policy forward. assets”. The Union may use that capac- a decision has defence implications, the
A NOT YET COMMON POLICY ity on missions outside its territory for Council must act unanimously and the
peacekeeping, conflict prevention and European Parliament must be informed.
The framers of the new treaty went strengthening international security in The European Council must carry out a
to great pains to provide limits for the accordance with the principles of the regular assessment of the threats facing
defence policy to keep it from spilling United Nations Charter. The perfor- the Union.
over onto national powers. It is clearly mance of these tasks resides on capabili-
stated that “the provisions governing the ties provided by the member states. The This clause was implemented in
Common Security and Defence Policy states agree, moreover, to make these advance following the terrorist attacks
do not prejudice the specific charac- capacities available and “progressively in March 2004 in Madrid. It has been
ter of the security and defence policy to improve” them. supplemented with a provision on civil
of the member states. The EU and its protection (see separate article).
member states will remain bound by Petersburg tasks. In addition to
the provisions of the Charter of the humanitarian and rescue tasks, and OPERATIONAL MEANS
United Nations and, in particular, by combat forces in crisis management, Permanent structured cooperation.
the primary responsibility of the Secu- already found in the previous treaty, the
rity Council and of its members for the reform treaty enlarges the scope of such This is the main innovation of the new
maintenance of international peace and missions – which were launched during treaty. The states wishing to take part must
security” (Declaration 30). the war in former Yugoslavia, in June agree to provide combat troops that can
1992, at a meeting of WEU Foreign and be deployed outside the EU, with all the
What is more, unanimity is the rule Defence Ministers in Petersburg (near necessary support elements (transport,
in decision-making on defence policy Bonn). These now encompass: joint dis- logistics, etc) and at brief notice (five
and the adoption of legislative acts is armament operations, military advice to 30 days) for a period of four months.
ruled out (Article 17 TEU). There is and assistance tasks, conflict preven- This cooperation may be implemented
no possibility of a switchover to quali- tion and peacekeeping tasks, as well as immediately upon the treaty’s entry into
fied majority (Article 280H TFEU). In post-conflict stabilisation. All these mis- force. Any state wishing to participate
the same spirit, the EU Court of Justice sions may contribute to the fight against shall notify the high representative.
terrorism (Article 28 TEU). The decision establishing the coopera-
tion shall be taken within three months
Common defence clause. Inspired following notification. A member state
by the WEU Treaty, the new EU treaty may also decide to sign up at a later
establishes an obligation of mutual date. Decisions on the creation(...)
defence. If a member state is the victim
of an armed aggression on its territory,

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EUROPOLITICS N° 3398 Tuesday 23 October 2007 15

of cooperation, and those on the admis- but now also has the task of promoting har- 2. The Council may set up special
sion or suspension of member states, monisation of operational needs. It obviously funds made up of contributions from the
are taken by qualified majority. On the keeps its other tasks as well: helping to evalu- member states to finance preparatory
other hand, within the structured coop- ate observance of capability commitments, actions for Petersburg and CSDP tasks
eration, decisions must be adopted by research and development, strengthening of not covered by the EU general budget.
unanimity (Article 27(6) and 31 TEU the industrial and technological base of the The Council of Ministers must act by
plus Protocol 4). defence sector. The statutes, seat and operat- qualified majority on a proposal from
ing arrangements of the European Defence the High Representative (Article 26(3)).
Group of member states. The Coun- Agency shall be decided by qualified major-
cil may “entrust the execution of a task, ity (Article 30 TEU) WHO IS IN CHARGE?
within the Union framework, to a group The high representative (see separate
of member states in order to protect the FINANCIAL MEANS
Union’s values and serve its interests”. The treaty maintains the prohibition article) conducts the Union’s CSDP,
The states participating in the task must making proposals and executing the
keep the Council informed regularly on charging military or defence opera- policy as the Council’s representative
on its progress on their own initiative or tional expenditure to the Union’s gen- (Article 9e TEU).
at the request of another member state eral budget. Such expenditure must be
(Article 29 TEU). borne by the member states on the basis The European Parliament must be regu-
of gross national product, “unless all larly consulted by the high representative
(Simple) enhanced cooperation. members of the Council, acting unani- on the main aspects and basic choices of
Since the restrictions set out in the mously after consulting the European the CSDP and on how the policy evolves.
Treaty of Nice are abolished, this possi- Parliament, decide otherwise”. Parliament’s views must be “duly taken into
bility may apply to the CSDP. consideration”. Special representatives
There are two exceptions, however: may be involved in briefing the European
European Defence Agency. Created in 1. The Council may adopt a decision Parliament. The national parliaments may
anticipation in 2004, on a decision of the guaranteeing rapid access to credits ear- be involved in debate on defence, since
Thessaloniki European Council, the Euro- marked for the urgent financing of ini- the Conference of Community and Euro-
pean Defence Agency is legally enshrined in tiatives concerning preparatory activities pean Affairs Committees (COSAC) may
the treaty and has guaranteed autonomy. Its of Petersburg tasks. The European Par- convene an interparliamentary debate
remit is also broader: the agency is no longer liament must be consulted. twice a year on the subject. n
limited to crisis or armament management,

In Brief

Serafina buy of Intelsat approved October, in a five-day OLAF conference summit, that his idea for the appointment
in Budapest on international operational of a group of distinguished figures charged
The European Commission granted cooperation in the fight against cigarette with reflecting on the longer-term future
clearance on 22 October to the acquisition smuggling and cigarette counterfeiting by of the EU (2020-2030) has met with
of sole control of Intelsat by Serafina information exchange. The ‘cigarette task considerable interest. At the European
Holdings Limited (both of Bermuda), group’ provided nearly 40 customs and law Council on 13 and 14 December in
formed by funds managed by CIE enforcement agencies with an opportunity Brussels, Portuguese Prime Minister and
Management II Limited (UK). Serafina is to share their experiences. As cigarette Council President-in-Office José Sócrates
a special purpose vehicle company formed smuggling and counterfeiting affects not will propose a remit for such a group,
and managed by BCP Funds, a group of only the EU and member states’ revenue suggested by France last summer. The
private equity investment funds. Intelsat but also the employment of EU citizens, group of ten to 12 persons would have the
provides global voice, data, video and OLAF considers supporting the fight task of “reflecting on the future of the EU
wholesale internet communications services against cigarette smuggling and cigarette and its place in globalisation, echoing the
via satellites. counterfeiting a priority and plans to concerns of British Prime Minister Gordon
continue to organise ‘cigarette task group’ Brown, but without re-opening institutional
Cooperation against cigarette conferences in the future.  debates,” explained President Sarkozy.
smuggling Originally, the French proposal concerned
Panel of ‘wise men’ to study discussion of the question of the EU’s
Experts from the EU27, non-EU countries future of EU borders and the continuing enlargement
(Croatia, Egypt, Russia, Ukraine and of the Union, in particular the Turkish
the USA), Europol, the World Customs French President Nicolas Sarkozy accession, to which Sarkozy is opposed.
Organization and the European Anti-Fraud announced, on 19 October at the Lisbon
Office (OLAF) participated, from 15 to 19

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16 Tuesday 23 October 2007 N° 3398 EUROPOLITICS

EU Agenda

Tuesday 23 October n (*) Infrastructure for the Schengen October to take part in the 3rd EU-DKRP
Information System SIS environment Economic Workshop. This forum allows
European (regulation) - Report by Carlos Coelho for an exchange of ideas between North
Parliament (EPP-ED, PT) Korean economic officials and MEPs
n Mobilisation of the European and European business leaders. The EP
Plenary session Globalisation Adjustment Fund - Vote on delegation will consist of Chair Hubert
9:00-23:59 Strasbourg, Plenary report by Reimer Böge (EPP-ED, DE) Pirker (EPP-ED, AT), Jas Gawronski (EPP-
Chamber 15:00-18:00 ED, IT) and Glyn Ford (PES, UK). After
n Budgetary procedure 2008 - joint debate the 4-day visit, they will be joined by Astrid
9:00-10:00 n 2008 budget: Section III - Commission Lulling (EPP-ED, LU), Petya Stavreva
n Contribution of taxation and customs - Report by Kyösti Virrankoski (ALDE, FI) (EPP-ED, BU), David Martin (PES, UK)
policies to the Lisbon Strategy - Report by n 2008 budget (sections I, II, IV, V, VI, and Philip Claeys (ITS, BE) for a visit to
Sahra Wagenknecht (GEU/NGL, DE) VII, VIII, IX) - Report by Ville Itälä (PPE- South Korea, where they will meet with
DE, FI) lawmakers and government officials.
10:00-12:20 - Key Debate Contact: Lorinc Redei, Press Service,
n Results of the informal summit of heads 18:00-19:30 [email protected], (32-2) 28
of state and government (Lisbon, 18-19 n Question Time to the Commission 32379 (BXL), (33-3) 881 74912 (STR), (32)
October 2007) - Council and Commission 0498.98.32.83
statements 21:00-24:00
n Price rises - Joint debate Other events
12:30-13:30 n Foodstuffs - Oral question EPP-ED to Ettore Majorana Prize - Erice -
n Votes Commission Science for Peace 1988-2006 - Award
n Pursuant to Rule 43 (1) n Consumer Protection - Oral question ceremony
n (***) EC-Chile association agreement PES to Commission 18:00-22:00 Strasbourg, European
(following the accession of Bulgaria and n Significant increases in food prices and Parliament, outside Plenary Chamber (first
Romania) - Report by Helmuth Markov consumer protection - Oral question UEN floor) - LOW
(GEU/NGL, DE) to Commission n 18:00-19:00 Award of the prize to
n (*) EC-Swiss Confederation Agreement n Tobacco smoke: policy options at EU Helmut Kohl
on Scientific and Technical Cooperation - level - Report by Karl-Heinz Florenz (EPP- n Speeches by the EP President Hans-Gert
Report by Angelika Niebler (EPP-ED, DE) ED, DE) Pöttering, Prof. Zichichi, the Erice Prize
n (*) Community plant variety rights n (***) Protocol amending the TRIPS President and Helmut Kohl.
- Report by Neil Parish (EPP-ED, UK) Agreement - Recommendation by Gianluca Contact: Leone Rizzo, (32-2) 28 31473
Susta (ALDE, IT) (BXL), (33-3) 881 76677 (STR)
Pursuant to Rule 131 n (***I) Qualifications framework for
n (***) Nuclear energy (ratification by lifelong learning - Report by Mario Council of
Slovenia of the Protocol amending the Paris Mantovani (EPP-EP, IT) Ministers
Convention) - Report by Giuseppe Gargani
(EPP-ED, IT) The President’s diary Agriculture and Fisheries Council
n (*) First and the second amendments to 18:00-18:30 Strasbourg, European 2007-10-22/23, Luxembourg
the UN/ECE Espoo Convention - Report Parliament
by Miroslav Ouzký (EPP-ED, CZ) n 18:00 Speech in honour of Helmut Kohl Plenary meeting of the Commission
n (*) Access of Bulgaria and Romania to at ‘Ettore Majorana Prize - Erice - Science 2 of the Assembly of European
the Convention on the protection of the for Peace’ Regions and Seminar “Social and
EC’s financial interests - Vote on report by Health Policies in the outermost
Jean-Marie Cavada (ALDE, FR) Delegations regions”-with assembly of European
n (*) Infrastructure for the Schengen Delegation for Relations with Korea Regions
Information System SIS environment 9:00-19:00 North Korea (Pyong Yang) 2007-10-22/24, Azores/Terceira
(decision) - Report by Carlos Coelho (EPP- Three Members of the EP’s Delegation
ED, PT) for Relations with the Korean Peninsula
will visit North Korea from 23-27

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EUROPOLITICS N° 3398 Tuesday 23 October 2007 17

e-Health web meeting-with Assembly devoted to trade protection tools Advocate General : Ruiz-Jarabo Colomer
of European Regions n Commission legislative and work n Judgement C-112/05 Commission v
2007-10-22/24, Azores/Terceira programme 2008 Germany
n General framework directive addressing Freedom of establishment
2nd “peer review” on the prevention labour immigration Case C-112/05
of alcohol-related harm-with n Directive on the conditions of entry and Failure of a Member State to fulfil
Regional Assembly residence of highly skilled workers obligations - Articles 43 EC and 56
2007-10-22/24, Azores/Terceira n White paper on health strategy EC - Conditions for the privatisation
n Communication on the results of the of Volkswagenwerk GmbH - Allocation
Web “Alive” Meeting-With Assembly consultation relating to the Green paper of special rights to certain shareholders
of European Regions «Modernising labour law to meet the - Mandatory State representation on
2007-10-22/24, Azores/Terceira challenges of the 21st century» the supervisory board of the company,
n Communication on undeclared work irrespective of the numbers of shares held
Work meeting of the group for n Communication on Economic Advocate General : Ruiz-Jarabo Colomer
equal opportunities between women Partnership Agreements n Judgement C-403/05 Parliament v
and men-With Assembly of European Commission
Regions Travel and visits External relations
2007-10-22/24, Azores/Terceira n Commissioner Andris Piebalgs takes part Annulment of the Commission’s decision
in International Energy Week( (Moscow) approving a project on the security of the
Presidency, High Representative and n 13.00 – Mr Jacques Barrot participates in borders of the Philippines (ASIA/2004/016-
Commission at the Council of Europe the «Minsterial Conference on Motorways 924; budgetary line 19 10 02) adopted
2007-10-23, Strasbourg of the Sea and Logistics» (Lisbon) in compliance with Council Regulation
(EEC) No 443/92 of 25 February 1992, on
EDSP Crisis Prevention and the Court of Justice financial and technical assistance to, and
resolution of Conflicts in Africa economic cooperation with, developing
2007-10-23, Lisbon Grand Chamber countries in Asia and Latin America (OJ
9:30 1992 L 52, p. 1)
Informal Meeting of the Directors n Judgement C-273/04 Poland v Council Advocate General : Kokott
of the Anti-Doping Laboratories New accessions n Judgement C-440/05 Commission v
2007-10-23, Lisbon Annulment of Article 1.5 of Council Council
Decision 2004/281/EC of 22 March Police and judicial cooperation in
Conference the European Social 2004 adapting the Act concerning the criminal matters
Fund: Educating and Training for conditions of accession of the Czech Annulment of Council Framework
Employment and Cohesion Republic, the Republic of Estonia, the Decision 2005/667/JHA of 12 July 2005
2007-10-23, Lisbon Republic of Cyprus, the Republic of Latvia, to strengthen the criminal-law framework
the Republic of Lithuania, the Republic for the enforcement of the law against ship
Ministerial Conference-Motorways of Hungary, the Republic of Malta, the source pollution (OJ L 255, 30.09.2005, p.
of the Sea and Logistics Republic of Poland, the Republic of 164)
2007-10-23, Lisbon, Gare Mar Slovenia and the Slovak Republic and the Advocate General : Mazák
adjustments to the Treaties on which the
Ministerial Conference – European Union is founded, following the Court of First
Motorways of the Sea and Logistics reform of the common agricultural policy Instance
2007-10-23, Lisbon, Gare Marítima de (OJ 2004 L 93, p. 1) - Infringement of the
Alcântara principles of non-discrimination, equal First Chamber
treatment and good faith. 9:30
Troika COMEP/COMAG/COMEM with Advocate General : Poiares Maduro n Judgement T-405/04 Borco-Marken-
Russia n Judgement Joined Cases C-11/06, C- Import Matthiesen v OHMI (Caipi)
2007-10-23, Lisbon 12/06 Morgan Intellectual property
Citizenship of the Union Community trade mark - Action brought
European Preliminary ruling - Verwaltungsgericht against Decision R 912/2002-2 of the
Commission Aachen - Interpretation of Articles 17 EC and Second Board of Appeal of the Office for
18 EC - Refusal to award an education or Harmonisation in the Internal Market
Weekly meeting training grant (‘Ausbildungsförderung’) to a (OHMI) of 6 August 2004 dismissing the
Strasbourg, 13.00 national who is residing and pursuing studies appeal brought against the decision of the
On the agenda: in another Member State on the ground that examiner refusing registration of the word
n meeting preceded by a working lunch that national has not completed at least the mark ‘Caipi’ for goods in Class 33
first year of those studies in an established
situated within the national territory

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18 Tuesday 23 October 2007 N° 3398 EUROPOLITICS

n Hearing T-131/06 Rykiel Création Single Judge Economic and
and Diffusion de Modèles v OHMI - 9:15 Social Committee
Cuadrado (SONIA SONIA RYKIEL) n Judgement T-138/05 Commission v
Intellectual property Impetus 23/10/2007 - Lisbon, Portugal
Community trade mark - Action for Company law n Presentation by Mr Simons, rapporteur
annulment brought by the applicant Action founded on an a jurisdiction clause of the TEN exploratory opinion on
for the figurative mark ‘SONIA SONIA seeking an order against the defendant for ‘Motorways of the Sea and Logistic’ in the
RYKIEL’ for goods in classes 3, 9, 14, the reimbursement of a part of the amount Ministerial Conference on ‘Motorways
18 and 25 against the decision of the of advances paid by the Community in of the Sea and Logistics’ organised by the
First Board of Appeal of the Office for respect of the contracts ‘COP 493 - Invite’ Portuguese Presidency.
Harmonisation in the Internal Market and ‘TR 1006 - Ausias’, entered into
(OHIM) of 30 January 2006 in Case R under European Parliament and Council 23/10/2007 - Brussels
329/2005-1 annulling the Opposition Decision No 1110/94/EC of 26 April 1994 n Interview of President Dimitriadis by
Division’s decision which rejected the (OJ 1994 L 126, p. 1) and in respect of the Commission Direct on the EESC role in
opposition brought by the proprietor of contract ‘V 2043 - Artis’ entered into under communicating Europe
the national marks ‘SONIA’ in respect of Council Decision 90/221/Euratom, EEC of
goods in classes 24 and 25 23 April 1990 (OJ 1990 L 117, p. 28)

In Brief

Solana to meet new Iran negotiator activities in the hotel sector in Germany construction equipment, forklifts and
(in particular in Dresden and Mainz). machine tools. Bobcat and Doosan are
Javier Solana was preparing for a meeting However, given the modest presence both active in the sale of construction and
on familiar territory with the Iranian of Blackstone and Hilton as well as the earthmoving equipment in the EEA. The
nuclear negotiator Ali Larijani on 23 existence of strong competitors on the new entity would face numerous effective
October in Rome. But he will meet a new market for hotel accommodation in these competitors and there were only limited
face from Iran. Said Jalili, a close colleague cities, the Commission concluded that the overlaps between the parties’ activities when
of President Mahmoud Ahmadinejad, proposed transaction would not give rise looking at types of individual equipment,
has replaced Ali Larijani out of the blue, to competition concerns on this market. stated the Commission. 
after a surprise resignation on 19 October. Blackstone, via Galileo and Worldspan, is
A change interpreted by many experts also engaged in the market for electronic Acquisition of Alcogroup approved
as a sign of Tehran taking a harder line global distribution systems, an activity that is
on the nuclear dossier, which would put vertically linked to Hilton’s hotel activities. The European Commission granted
the relaunch of negotiations that Solana But the Commission noted that the new clearance on 22 October to the acquisition
had hoped for in jeopardy. Officially, Iran entity would have neither the ability nor the of joint control of Alcogroup SA (Belgium)
denies any change in position and has incentive to create supply problems or to by EDF Energie Nouvelles (France)
not cancelled the meeting with the EU close off competitors on this market.  and Alcofinance (Belgium). EDF EN is
representative. This change in plans was active in the production of electricity from
welcomed with caution by EU diplomats. Purchase of Ingersoll Rand by renewable energy sources, in particular
In Rome, Solana will try to discern Jalili’s Doosan cleared wind power, hydro power, biomass and
intentions and evaluate the chances of solar energy. Alcofinance and Alcogroup
short-term diplomatic progress. If this is The European Commission approved, on 22 both produce, distribute and sell ethanol.
not the case, new sanctions seem to be October, the purchase of Bobcat, Ingersoll
inevitable. (SFA) Rand Utility Equipment and Ingersoll Purchase of Nord Est by 21 Centrale
Rand Attachments (together ‘Bobcat’), Partners cleared
Blackstone’s takeover of Hilton three business units of the Ingersoll Rand
cleared Company of the US, by the South Korean The European Commission cleared, on
company Doosan Infracore Co Ltd. Bobcat 22 October, the purchase of the French
The European Commission approved, is active worldwide in the manufacture and company Nord Est SA by 21 Centrale
on 20 October, the takeover of the US- sale of compact construction equipment Partners, a French capital investment
based Hilton company, active in the hotel and agri-business equipment. Doosan is a management company, controlled by
industry, by Blackstone, a US-based asset conglomerate company active worldwide Edizione Holding S.p.A of Italy, a holding
manager. The Commission stated that in a wide range of industries, including company in the Benetton Group. Nord Est
there is an overlap between the parties’ is active in the packaging sector. 

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