Brussels Brief - May 18, 2007
May 18, 2007
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KEY DEVELOPMENTS
Internal Market: New Rules on Manufacturing Standards for Road Vehicles
Marta Becerra
On 10 May 2007 the European Parliament voted in favour of extending the scope of the Directive on Car Type-Approval to trucks, vans, buses and trailers. Up to now this harmonised approval system was restricted to passenger cars, motorbikes, mopeds and agricultural tractors. From now on, all road vehicles approved for sale in one EU Member State will be allowed to be marketed anywhere in the EU without further tests. This removes barriers to trade among Member States and reduces the administrative burden on manufacturers. In addition, the new rules will improve environmental and safety standards.
Taxation: Commission Launches “Taxes in Europe” Database
Geert Dierickx
The European Commission’s collaboration with the Member States' Ministries of Finance has resulted in a new online information tool on taxes in the EU. For each Member States’ income tax, VAT, excise duties, as well as social security contributions, the tool contains information on the legal basis, assessment base, main exemptions and applicable rate(s). The new tool does not include customs duties and tariffs as these are regulated at EU level, although such information is available via the Commission’s TARIC database. The yearly updated tax database gives direct and free access to information that was previously only available in part. Furthermore, the online tool fosters transparency by allowing an easy comparison between the various taxation systems in the EU.
Competition: Antitrust Proceedings Against RWE and ENI
Sara Bacchio
The European Commission has announced the opening of separate competition proceedings against the German energy company RWE and the Italian energy company ENI for allegedly abusing their respective dominant positions in their national wholesale natural gas markets. ENI is suspected of capacity hoarding and strategic underinvestment in the transmission system in Italy. RWE is accused of hindering competitors’ access to capacity on gas transport infrastructure in Germany. The Commission’s preliminary view is that such behaviour of both companies was aimed at excluding potential competitors from the market (ie, so-called market foreclosure) and thus possibly constitutes an infringement of the EC Treaty. Both cases are being launched on the basis of information gathered during dawn raids carried out in May 2006.
State Aid: Commission Opens In-Depth Investigation into Italian Chemical Companies
Benoît Keane
The European Commission has launched an in-depth investigation into restructuring aid of around EUR 20 million to the Italian companies NGP and Simpe. NGP was created in 2003 through the separation of the polyester polymer business of Montefibre. NGP ran into financial difficulties in 2004. In July 2005 an agreement to safeguard the production of polyester polymer was signed with regional authorities and by several companies located on the site. In September 2005 NGP set up a new company Simpe which took over the polymerisation assets. However, the State aid rules prohibit new companies from receiving restructuring aid. In addition, companies that receive restructuring aid must finance 50 per cent of the restructuring costs. The Commission is investigating whether the aid was in compliance with these aspects of the State aid rules.
Internal Market: Hedge Funds, Asset Management and the Financial Implications of Ageing
Alana Tervo
On 8 May 2007 the European Council adopted conclusions on three interlinked issues relating to financial markets. First, although they recognised that hedge funds foster the efficiency of the financial system, they called on creditors, investors and national authorities to remain vigilant to the potential risks posed by hedge funds. Second, the Council called on the Commission to revise EU legislation on undertakings for collective investment in transferable securities (“UCITS Directive”). Finally, to address the financial implications of ageing, the Council asked the Commission to consider the development of a single pension market for retirement products and requested that Member States work for increased participation and contribution levels of households in non-statutory pension schemes.
Internal Market: Malta and Cyprus Set to Join Eurozone in 2008
Bróna Heenan
The European Commission and the European Central Bank have given the green light for Malta and Cyprus to join the Eurozone. The final decision will be taken by the EU Finance Ministers in July, after consultation of the European Parliament and following a discussion by EU leaders at their June summit. If all goes well, Malta and Cyprus will join the 13 existing Eurozone members in January 2008, the last to join being Slovenia in January 2007. While both countries have inflation rates within the required thresholds, their public deficits are slightly higher than the EU’s 60 per cent limit. However, the public deficit limit has not been strictly applied in the past in relation to Italy, Belgium and Greece and has not been an obstacle in relation to Malta and Cyprus either.
Mergers: VB Autobatterie Acquires Part of FIAMM, Subject to Remedies
Jérôme Cloarec
The European Commission has approved VB's takeover of FIAMM’s automotive battery business. Both companies supply batteries to car and truck manufacturers as well as to providers of replacement parts. VB, a joint venture of the US firm Johnson Controls and the German company Robert Bosch, is the leader in the European market of automotive starter batteries. The Commission's in-depth investigation concluded that the transaction would seriously limit the ability of car and truck manufacturers to switch to alternative suppliers. However, the Commission considers the remedies proposed by VB to be sufficient to preserve competition. These remedies include divesture of manufacturing capacity and of some key FIAMM brands relevant to the replacement part markets of Italy, Austria, the Czech Republic and Slovakia.
Pharmaceuticals: Faster Access to Better Medicines – the Innovative Medicines Initiative
Helen Kinghorn
The Innovative Medicines Initiative (IMI) is a proposed partnership between the European Commission and the European Federation of Pharmaceutical Industry and Associations. Its objective is to lead and reinvigorate research and development within the European bio-pharmaceutical industry and, in the long term, to provide faster access to better medicines for EU citizens. This goal will be realised through the provision of funding to European Public-Private Collaborations, consisting of academic institutions, SMEs, bio-pharmaceutical companies, regulatory authorities and patients. The proposed budget will comprise a contribution of EUR 1 billion from the European Union’s 7th Research Framework Programme for the period 2007 – 2013, matched by the provision of research and development resources from the bio-pharmaceutical industry. (See Brussels Brief of 20 April 2007).
Competition: ECJ Rejects SGL Carbon Appeal
Philip Bentley QC
The European Court of Justice (ECJ) has rejected SGL Carbon’s appeal against the Court of First Instance’s (CFI) judgment that reduced to EUR 9 million the European Commission’s fine in respect of SGL Carbon’s participation in a cartel in the isostatic graphite sector. The ECJ’s ruling confirms two well-established points. First, when setting fines for competition infringements in the EU, the Commission does not have to take into account the amount of fines imposed by other competition authorities for infringements in other territories. Second, it is not for the ECJ to substitute its own assessment for that of the CFI concerning the proper amount of the fine.
NEXT WEEK’S EVENTS
Monday 21 May – Friday 25 May 2007
COUNCIL MEETINGS
Competitiveness Council (21 – 22 May 2007)
Education, Youth and Culture Council (24 – 25 May 2007)
COURT OF JUSTICE
Judgments
Agriculture
C-45/05 Maatschap Schonewille-Prins
Environment and consumers
C-376/06 Commission v Portugal
C-361/05 Commission v Spain
Freedom of establishment
C-43/06 Commission v Portugal
Free movement of capital
C-157/05 Holböck
Free movement of goods
C-172/06 Commission v Spain
Industrial Policy
C-394/05 Commission v Italy
Social policy
C-364/06 Commission v Luxembourg
C-375/06 Commission v Portugal
C-359/06 Commission v Austria
Opinions
Approximation of laws
C-84/06 Antroposana and Others
Convention on jurisdiction
C-98/06 Freeport
External relations
C-403/05 Parliament v Commission
Freedom of establishment
C-438/05 The International Transport Workers' Federation and The Finnish Seamen's Union
Freedom to provide services
C-195/06 Österreichischer Rundfunk
Principles of Community law
C-341/05 Laval un Partneri
State aid
C-199/06 Centre d'exportation du livre français
COURT OF FIRST INSTANCE
Judgments
Competition
T-289/01 Duales System Deutschland v Commission
T-151/01 Duales System Deutschland v Commission
Environment and consumers
T-198/05 Mebrom v Commission
T-216/05 Mebrom v Commission
Intellectual property
Joined Cases T-241/05, T-262/05, T-263/05, T-264/05, T-346/05, T-347/05, T-29/06, T-30/06, T-31/06 Procter & Gamble v OHMI
Research, information, education, statistics
T-500/04 Commission v IIC
