Brussels Brief - November 24, 2006
November 24, 2006
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KEY DEVELOPMENTS
Trade: EU Accepts WTO Ruling on GMOs
James Arneill
The European Union has announced that it will not appeal against a WTO ruling, issued in September, which condemned its four year moratorium on imports of genetically modified organisms (GMOs). The complaint, originally brought in 2003 by Argentina, Canada and the US, resulted in a finding that the EU had applied a “de facto moratorium” on GMO imports between 1999 and 2003, which had resulted in “undue delay” thereby violating international trade rules. Further national bans imposed by six Member States on a number of GMO products, which the Commission had since approved as safe, were also found to be in violation of WTO rules. Although the moratorium itself was lifted in 2004, the Commission has asked for a “reasonable period of time” to work with Member States in order to deal with the national bans, which are still in place.
Trade: EU in WTO Consultations with India Over Alcohol Duties
Michal Cieplinski
The European Commission has requested formal consultations with India pursuant to the WTO’s Dispute Settlement Understanding regarding India’s import regime for spirits and wines. The EU decision to request consultations follows an investigation which concluded that access to the Indian market for spirits and wines is severely restricted due to high duties and restrictions on retail distribution in certain Indian States. The key issue at stake is the high additional duties levied on imported spirits and wines. These duties are levied in addition to customs duties and raise the duty burden to between 177 per cent and 540 per cent depending on the import price of the products. A request for consultations is the first stage in the WTO dispute settlement process. If the dispute cannot be satisfactorily resolved in consultations, which normally last for at least 60 days, the EU may ask for constitution of a WTO Panel to rule on the legality of India’s import regime for spirits.
Aviation: ECJ set to Scrap Bilateral Deal Between US and Netherlands
Philip Torbøl
According to Advocate General Mengozzi, the Netherlands have breached EU law by maintaining their bilateral aviation agreement with the United States that provides Dutch airlines exclusive landing rights in the United States when departing from the Netherlands. The Advocate General's opinion (preliminary advice to the Court) was given in a case brought before the European Court of Justice (ECJ) by the European Commission against the Netherlands and confirms judgments from 2002 against eight other Member States for negotiating, applying or keeping in force aviation agreements with the US. A year ago, the EU and the US negotiated an “open skies” agreement to replace those bilateral agreements, but the deal has currently stalled due to US reluctance to relax their ownership restrictions.
Agriculture: Commission Urges Further Efforts in Restructuring EU Sugar Industry
Geert Dierickx
The European Commission is calling for renewed efforts by agricultural ministers and the sugar industry to further renounce quotas with a view to making the restructuring process a success for the sugar industry. EU sugar reform provided for a restructuring fund financed by sugar producers with effect from 1 July 2006. This fund had the function of assisting the restructuring process needed to render the industry more competitive. In order to ensure balance on the market after a four-year transition period, the objective is to take approximately 6 million tonnes out of the total quotas. During the first year, about 1.5 million tonnes of the total quotas were renounced under the restructuring scheme. At present, the declared intentions to renounce the respective quotas for 2007/2008 amount to only 0.7 million tonnes, which is far below what is required to balance the market. Given that the deadline for applications for 2007/2008 is 31 January 2007 and that consultations could take up to 45 days, restructuring intentions must be announced by early December.
Employment: Public Consultation on the EU Labour Market
Elena Kostadinova
The European Commission has launched a public consultation entitled “Adapting labour law to ensure flexibility and security for all”. The consultation will be followed by a Commission Communication on labour law reform in the EU. The initiative revives the discussion about flexibility in standard contracts, the introduction of certain forms of non-standard contracts and the adaptation of social protection systems at an EU level. The Commission has indicated that it would consider proposals for legal definitions of “worker”, “self-employed” and “minimum requirements on the working conditions of all workers regardless of the form of their work contract”. The discussion follows failed legislative initiatives to amend the Agency Workers’ Directive and the Working Time Directive.
State Aid: Commission Opens Investigation into Financial Support to DHL and Leipzig/Halle Airport
Patrice Corbiau
The European Commission has opened an in-depth investigation into possible aid granted by the German Land of Saxony to DHL and Leipzig/Halle airport, via the financing of the construction and operation of the new southern runway at Leipzig/Halle airport and financial guarantees endorsed by Saxony. These expansion works are linked to DHL’s decision to establish its European express parcel hub at the same airport. The Commission has doubts that the financial arrangements have been carried out by Saxony under conditions that would be acceptable to a market investor. The Commission also wants to ensure that DHL does not receive State aid in addition to the investment aid to DHL already approved by the Commission under the EU Multisectoral Framework on regional aid for large investment projects. In the Commission’s view, there is a risk that any further aid would distort competition in the European express parcel market.
State Aid: Commission Endorses Investigation into Distribution of Postal Savings Bonds in Italy
Mélanie Bruneau
The European Commission has decided that the remuneration paid by Cassa Depositi e Prestiti, a State-controlled financial body, to Poste Italiane, the universal postal service provider in Italy, for the distribution of postal savings books is consistent with market conditions and therefore does not constitute State aid. However, the Commission has opened a formal investigation under the State aid rules into the remuneration paid to Poste Italiane for the distribution of postal bonds. This remuneration may be higher than the market price and could therefore confer an economic advantage on Poste Italiane and constitute illegal State aid. The opening of an in-depth investigation gives interested parties one month to comment on the measure.
Trade: Commission Proposal to Ban Cat and Dog Fur in the EU
Elena Kostadinova
The European Commission has proposed a Regulation to prohibit the production, import, export and marketing of cat and dog fur in the EU. The proposal is a result of increasing concerns of EU citizens and EU Member States about imports of cat and dog fur, mainly from Asian countries. Such fur is then traded on the EU market in various forms – on clothing, as personal accessories or in children’s soft-toys. There are suspicions that such fur is declared as synthetic or other types of fur. Fifteen Member States have already adopted diverging measures to address the problem. The Regulation aims at harmonising Member States’ legislation and establishing a system of information exchange on the detection of cat and dog fur. The proposal raises two interesting issues. What is the correct legal basis for the Commission to act in this area and would any such restrictions be compatible with WTO obligations?
Monday 27 November – Friday 1 December 2006
COUNCIL MEETINGS
Economic and Financial Affairs Council (ECOFIN) (28 November 2006)
Employment, Social Policy, Health and Consumer Affairs Council (EPSCO) (30 November – 1 December 2006)
COURT OF JUSTICE
Judgments
Competition
Joined Cases C-376/05, C-377/05 A. Brünsteiner
Energy policy
C-413/04 Parliament v Council
C-414/04 Parliament v Council
Environment and consumers
C-32/05 Commission v Luxembourg
C-293/05 Commission v Italy
Opinions
Approximation of laws
C-381/05 De Landtsheer Emmanuel
Environment and consumers
C-342/05 Commission v Finland
C-326/05 P Industrias Químicas del Vallés v Commission
Freedom to provide services
C-432/05 Unibet
Free movement of goods
C-170/04 Rosengren and Others
COURT OF FIRST INSTANCE
Judgments
Customs union
T-382/04 Heuschen & Schrouff Oriëntal Foods v Commission
Intellectual property
T-43/05 Camper v OHMI - JC (BROTHERS by CAMPER)
