ISSN 1725-2423

Official Journal

of the European Union

C 318

European flag  

English edition

Information and Notices

Volume 49
23 December 2006


Notice No

Contents

page

 

II   Preparatory Acts

 

European Economic and Social Committee

 

429th plenary session, held on 13 and 14 September 2006

2006/C 318/1

Opinion of the European Economic and Social Committee on Sustainable development as a driving force for industrial change

1

2006/C 318/2

Opinion of the European Economic and Social Committee on The territorial governance of industrial change: the role of the social partners and the contribution of the Competitiveness and Innovation Programme

12

2006/C 318/3

Opinion of the European Economic and Social Committee on The contribution of IT-supported lifelong learning to European competitiveness, industrial change and social capital development

20

2006/C 318/4

Opinion of the European Economic and Social Committee on Services and European manufacturing industries: Interactions and impacts on employment, competitiveness and productivity

26

2006/C 318/5

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council establishing the European Globalisation adjustment Fund COM(2006) 91 final — 2006/0033 (COD)

38

2006/C 318/6

Opinion of the European Economic and Social Committee on the Proposal for a directive of the European Parliament and of the Council on the exercise of voting rights by shareholders of companies having their registered office in a Member State and whose shares are admitted to trading on a regulated market and amending Directive 2004/109/EC COM(2005) 685 final — 2005/0265 (COD)

42

2006/C 318/7

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council establishing common rules for the provision of basic information on Purchasing Power Parities and for their calculation and dissemination COM(2006) 135 final — 2006/0042 (COD)

45

2006/C 318/8

Opinion of the European Economic and Social Committee on the Proposal for a Decision of the European Parliament and of the Council on a paperless environment for customs and trade COM(2005) 609 final — 2005/0247 (COD)

47

2006/C 318/9

Opinion of the European Economic and Social Committee on Implementing the Community Lisbon programme: Proposal for a Directive of the European Parliament and of the Council on payment services in the internal market and amending Directives 97/7/EC, 2000/12/EC and 2002/65/EC COM(2005) 603 final — 2005/0245 (COD)

51

2006/C 318/0

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council on the law applicable to contractual obligations (Rome I) COM(2005) 650 final — 2005/0261 (COD)

56

2006/C 318/1

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council on type approval of motor vehicles with respect to emissions and on access to vehicle repair information, amending Directive 72/306/EEC and Directive …/…/EC [COM(2005) 683 final — 2005/0282 (COD)]

62

2006/C 318/2

Opinion of the European Economic and Social Committee on Social tourism in Europe

67

2006/C 318/3

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council concerning structural business statistics COM(2006) 66 final — 2006/0020 (COD)

78

2006/C 318/4

Opinion of the European Economic and Social Committee on the Proposal for a Directive of the European Parliament and of the Council amending Council Directive 91/477/EEC on control of the acquisition and possession of weapons COM(2006) 93 final — 2006/0031 (COD)

83

2006/C 318/5

Opinion of the European Economic and Social Committee on the Communication from the Commission to the Council and the European Parliament on a Thematic Strategy on the Urban Environment COM(2005) 718 final — {SEC(2006) 16}

86

2006/C 318/6

Opinion of the European Economic and Social Committee on The future outlook for agriculture in areas with specific natural handicaps (upland, island and outermost areas)

93

2006/C 318/7

Opinion of the European Economic and Social Committee on Meeting the challenges of climate change — The role of civil society

102

2006/C 318/8

Opinion of the European Economic and Social Committee on the Disposal of animal carcasses and the use of animal by-products

109

2006/C 318/9

Opinion of the European Economic and Social Committee on the Proposal for a Council Regulation laying down special measures to encourage silkworm rearing (Codifed version) COM(2006) 4 final — 2006/0003 (CNS)

114

2006/C 318/0

Opinion of the European Economic and Social Committee on the Proposal for a Directive of the European Parliament and of the Council amending Council Directive 76/769/EEC relating to restrictions on the marketing of certain measuring devices containing mercury COM(2006) 69 final — 2006/0018 (COD)

115

2006/C 318/1

Opinion of the European Economic and Social Committee on the Communication from the Commission to the Council and the European Parliament on improving the economic situation in the fishing industry COM(2006) 103 final

117

2006/C 318/2

Opinion of the European Economic and Social Committee on the Proposal for a Council Regulation on glucose and lactose (codified version) COM(2006) 116 final — 2006/0038 CNS

122

2006/C 318/3

Opinion of the European Economic and Social Committee on Belarus Civil Society

123

2006/C 318/4

Opinion of the European Economic and Social Committee on Immigration in the EU and integration policies: cooperation between regional and local governments and civil society organisations

128

2006/C 318/5

Opinion of the European Economic and Social Committee on European Works Councils: a new role in promoting European integration

137

2006/C 318/6

Opinion of the European Economic and Social Committee on Civil society participation in the fight against organised crime and terrorism

147

2006/C 318/7

Opinion of the European Economic and Social Committee on Quality of working life, productivity and employment in the context of globalisation and demographic challenges

157

2006/C 318/8

Opinion of the European Economic and Social Committee on Making European citizenship visible and effective

163

2006/C 318/9

Opinion of the European Economic and Social Committee on the Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions A Roadmap for equality between women and men 2006-2010 COM(2006) 92 final

173

2006/C 318/0

Opinion of the European Economic and Social Committee on Pan-European transport corridors 2004-2006

180

2006/C 318/1

Opinion of the European Economic and Social Committee on The energy supply of the EU: a strategy for an optimal energy mix

185

2006/C 318/2

Opinion of the European Economic and Social Committee on the — Proposal for a Directive of the European Parliament and of the Council on compliance with flag State requirements — COM(2005) 586 final — 2005/0236 (COD) — Proposal for a Directive of the European Parliament and of the Council on common rules and standards for ship inspection and survey organisations and for the relevant activities of maritime administrations — COM(2005) 587 final — 2005/0237 (COD) — Proposal for a Directive of the European Parliament and of the Council on port State control — COM(2005) 588 final — 2005/0238 (COD) — Proposal for a Directive of the European Parliament and of the Council amending Directive 2002/59/EC establishing a Community vessel traffic monitoring and information system — COM(2005) 589 final — 2005/0239 (COD) — Proposal for a Directive of the European Parliament and of the Council establishing the fundamental principles governing the investigation of accidents in the maritime transport sector and amending Directives 1999/35/EC and 2002/59/EC — COM(2005) 590 final — 2005/0240 (COD) — Proposal for a Regulation of the European Parliament and of the Council on the liability of carriers of passengers by sea and inland waterway in the event of accidents — COM(2005) 592 final — 2005/0241 (COD) — Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners — COM(2005) 593 final — 2005/0242 (COD)

195

2006/C 318/3

Opinion of the European Economic and Social Committee on the Proposal for a Directive of the European Parliament and of the Council amending Council Directive 89/552/EEC on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities COM(2005) 646 final — 2005/0260 (COD)

202

2006/C 318/4

Opinion of the European Economic and Social Committee on the GALILEO programme: successful establishment of the European supervisory authority

210

2006/C 318/5

Opinion of the European Economic and Social Committee on the Communication from the Commission on the promotion of Inland Waterway Transport NAIADES — An Integrated European Action Programme for Inland Waterway Transport COM(2006) 6 final

218

2006/C 318/6

Opinion of the European Economic and Social Committee on the Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions — Bridging the Broadband Gap COM(2006) 129 final

222

2006/C 318/7

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 417/2002 on the accelerated phasing-in of double-hull or equivalent design requirements for single-hull oil tankers and repealing Council Regulation (EC) No 2978/94 COM(2006) 111 final — 2006/0046 (COD)

229

EN

 


II Preparatory Acts

European Economic and Social Committee

429th plenary session, held on 13 and 14 September 2006

23.12.2006   

EN

Official Journal of the European Union

C 318/1


Opinion of the European Economic and Social Committee on Sustainable development as a driving force for industrial change

(2006/C 318/01)

On 14 July 2005 the European Economic and Social Committee, acting under Rule 29(2) of its Rules of Procedure, decided to draw up an opinion on Sustainable development as a driving force for industrial change.

The Consultative Commission on Industrial Change, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 31 August 2006. The rapporteur was Mr Siecker and the co-rapporteur was Mr Činčera.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 14 September), the European Economic and Social Committee adopted the following opinion by 98 votes to 11 with 11 abstentions.

Part 1: Summary of the EESC's conclusions and recommendations

A.

In January 2003 the EESC adopted an own-initiative opinion entitled Industrial change: current situation and prospectsAn overall approach. The goal of that opinion was not only to provide an overview of the most pressing industrial change issues and trends, but also to highlight the role of the CCMI and its future work. Among the areas of responsibility assigned to the CCMI in this context the following were to be found:

‘analysing industrial change and its causes from the economic, social, territorial and environmental points of view, as well as assessing the impact of industrial change on sectors, firms, workforces, territories and the environment.

seeking common approaches to promoting sustainable development […].’

The abovementioned opinion also stressed the need to ‘combine competitiveness with sustainable development and social and territorial cohesion’ in keeping with the Lisbon strategy. Moreover, it proposed a working concept of ‘industrial change’ that embraced both the developments affecting companies and the interaction of these with their environment.

So far, the CCMI has focused mainly on assessing the impact of industrial change on sectors, firms, employees, territories and the environment. The aim of the present own-initiative opinion is to examine how sustainable development can be a catalyst for industrial change.

B.

That same opinion concluded that change in the European industrial sector has often been approached from the restructuring angle but that it is a much more dynamic concept. The business world is closely linked to the European political and social environment in which it develops and which, in turn, influences the process of industrial change. Fundamental industrial change comes about in two ways: through radical action and through gradual adaptation. Precisely, the aim of this own-initiative opinion is to consider how sustainable development as Brundtland defined it (a development that meets the needs of today without endangering the supply of the needs of future generations) can act as a catalyst for gradual and proactive industrial change.

C.

The opinion provides, in the main, examples from the energy and related sectors but the same processes as described here can be applied to others. The reasons for this choice of sectors are several:

the Brundtland definition of sustainable development implies the need to move towards renewable natural resources;

energy is a cross-sector issue;

lessons to be learned from the introduction of new technologies in this field may be extrapolated to other sectors;

the 25 Member States currently import about 50 % of their required oil and gas; this could rise to 70 % by 2030, at which time the Commission predicts most suppliers will hail from ‘geopolitically uncertain zones’.

D.

The moment when a particular technology becomes available is determined by R&D. The moment when it is actually put in use is determined by the market, however. The gap between the two can also be influenced by politics. Thanks to a balanced mix of policy measures — subsidies, promotion, taxes — business in Sweden and Japan began at an early stage with the technological development of heat pumps and solar panels respectively. Partly as a result of this, these countries have succeeded in building a market-leading position.

E.

The EESC reaffirms that the three pillars of the Lisbon strategy are of equal importance. However, it is often stressed that there is scope for environmental and social considerations only against a background of a healthy, growing economy. That is an overly simplistic explanation of the strategy as the reverse is also the case. Certainly there is no scope for a healthy, growing economy against a background of a sick environment or of a society driven by social dissent. The Committee welcomes the actions that have been taken in this field and which are described in Annex 2 of the Commission Communication on the Review of the Sustainable Development Strategy — A platform for action (1).

F.

Sustainability is not just one of the options on a list; rather, it constitutes the only possible course of action in order to secure a viable future. The concept of ‘sustainability’ is an overarching one and is therefore not restricted to the environment, but also embraces economic and social sustainability issues. Continuity of a business is a form of economic sustainability which can best be achieved by maintaining profitability. Europe can contribute to this by strengthening competitiveness through innovation and by stimulating research and development through active policy and a mix of targeted measures (see, for example, Sweden and Japan).

G.

Social sustainability means allowing people to live healthy lives and to generate an income while guaranteeing a reasonable level of social security to those who are not able to do likewise. The EESC maintains that Europe can contribute in this area by striving for a society that enables people to maintain their vocational skills, by offering them decent work in a safe and healthy working environment and in a climate where there is room for both workers' rights and fruitful social dialogue.

H.

The eco-industry offers a lot of opportunity for economic growth. Europe has a strong position in a number of sectors in this industry. In order to retain and develop its strengths and to achieve similar positions in other sectors, the EESC feels that Europe has to display greater ambition.

I.

An industrial policy directed at sustainable development can contribute to the competitiveness of the entire European economy, including not only to the new rising sectors, but also to the traditional industrial sectors. The EESC wants the European Commission to support such a policy. Examples described in this opinion show that well thought-out and implemented support schemes (combination of taxation, feed-in tariffs, promotion and regulation) during the introduction of new environmental technologies can help to create a market for these technologies that can then be developed further without support. Any support mechanism must be clearly degressive as the cost of state aid should not restrict the international competitiveness of other industries.

J.

The EESC notes that subsidies and incentives are not always efficient and can incur large financial costs with little economic effect if used improperly. Subsidies and regulations should help the market start up and develop initially until the technology is ripe to permit survival without any support. The key factors of successful support are as follows:

right duration;

proper specification;

degressive in time;

announced well in advance;

cooperation between government and private sector.

K.

Sustainable development is not to be limited to a European context, as it has a global dimension. European sustainability policy should be endowed with instruments to prevent reallocation of labour to other regions. In order to ensure a level playing field, a two-pronged approach is needed: internally to the EU on the one hand and externally to the EU on the other. Regarding the former, appropriate instruments should be introduced to ensure that social and environmental costs resulting from non-sustainable production methods within the European Union be internalised in the price of goods to promote the main thrust of the report of the World Commission on the Social Dimension of Globalisation for policy coherence amongst the ILO, WTO, IMF and World Bank (see CESE 252/2005). In terms of the latter, the EU should make every effort in relevant international fora (in particular WTO) to include non-trade concerns such as fundamental social and environmental standards into international agreements on trade to facilitate the upgrading of the sustainability policies of Europe's competitors. Countries such as the United States, India and China have an unfair economical advantage compared to Europe as long as they are not bound by the Kyoto protocol's CO2 reduction targets. Those agreements should be implemented on a global scale as trade can only be really free when it is also fair.

Part 2: Arguments to support the opinion

1.   Overview

1.1

Our economy is currently based on the availability of cheap energy and raw materials. But supplies are finite, which is partly why they are becoming considerably more expensive. Structural and technological change which are possible, are needed and Europe has to contribute to that change so as to help European industry to meet that challenge. Sectors which involve high levels of consumption of energy and raw materials have to turn to more sustainable production in the future in order to reduce the drain on natural resources. Because these sectors will still be needed in the future as the production of starting and semi-manufactured materials is the basis of industrial value.

1.2

Sustainably producing European energy-intensive industries which compete internationally must not be forced out of the market by competitors from outside the EU using less sustainable production methods. To prevent this occurring a level playing field must be created for those sectors in cooperation between civil society and government.

1.3

The greatest challenge confronting us is the development of a sustainable society which can maintain the present level of prosperity and at the same time neutralise the negative side-effects of current patterns of consumption. One of the main conditions for this is that we learn to cover our energy needs differently and transition to a different form of industrial production.

1.4

The need for gradual transition to a more sustainable model of society is beyond dispute. There are several reasons for that requirement. Experts differ on the period of time fossil fuels will be available for a reasonable price, but everyone agrees that they will become increasingly rare and expensive. In addition, and due to our consumption habits we are facing one of the greatest threats of our age: climate change.

1.5

Ideally, the best way to stop these processes would be to stop burning fossil fuels as we are at present. However, in the short term this is both politically and economically impossible. We have to adopt other approaches, for something has to change — if not as fast as desirable, then at least as fast as possible.

1.6

By applying the trias energetica  (2), a model whereby more efficient energy use can be stimulated in three steps, a start can be made in the short term on moving towards more sustainable consumption and production. These steps are:

reducing demand for energy through more efficient consumption;

making maximum use of sustainable, renewable energy sources;

applying efficient technologies that enable the use of remaining fossil fuels in a cleaner way.

1.7

For this a package of measures is needed both to put these three objectives into effect and to bring about a switch to more sustainable industrial production. These measures must be based on an economic and strategic calculation. When making such calculations, there inevitably comes a time when choices have to be made between conflicting interests. We must not avoid these conflicts. So-called ‘win-win situations’ do exist and policies should always be directed towards their creation, but, in practice, that can be very hard. In such a case, choices have to be made between opportunities for sustainable change and the protection of existing interests, taking into account the natural rise and decline of any one sector over another. Such existing and conflicting interests should be made transparent and addressed.

1.8

The concept of sustainability dictates that economic, environmental and social aspects of the development of European society are equally important. This opinion will:

focus primarily on renewable energy sources and the striving for energy and raw-material efficiency (chapters 2 & 3);

look at the opportunities of sustainable development in a selection of sectors (chapter 4);

address a number of the social aspects (chapter 5).

2.   Renewable energy sources

2.1   Introduction

2.1.1

Every year the Earth absorbs 3 million exajoules (EJ) of solar energy. Total reserves of fossil fuels amount to 300 000 EJ, 10 % of total annual insolation. Total annual energy use is 400 EJ. The 3 million EJ of energy absorbed are available in the form of 90 EJ of hydroelectric power, 630 EJ of wind energy and 1 250 EJ of biomass. The rest is available as solar energy (3). Thus, in fact there is enough sustainable energy to cover our needs. Accessing it is the problem.

2.1.2

As, given the cost aspect and the lack of appropriate technology, renewable energy sources will not be able to meet rising energy demand in the short term, other energy sources will be needed. There is potential for fossil fuels to be used cleanly, for example by removing the CO2 and subsequently storing it to prevent its release into the atmosphere. The development of technology for capturing and storing CO2 is in full swing: a dozen or so pilot installations are already either in the startup phase or under construction in Europe, North America and China. The use of this technology can be expected to break even as early as 2015/2020.

2.1.3

The duration of support schemes for renewable energy is crucial, as premature withdrawal may jeopardise the new industry, and on the other hand, prolonged support is not efficient. Typically, support can be gradually phased out, as R&D and economies of scale push the price of the technology lower. Proper specification of the support scheme is also of high importance. Finally, it is important that support schemes be announced in advance so that business has time to prepare for the new market conditions.

2.1.4

The nuclear energy debate is becoming increasingly important, as is shown by the Green Paper on a European Strategy for Sustainable, Competitive and Secure Energy (4) and the Conclusions of the March 2006 European Council on this subject. In some countries there is a majority in favour of nuclear energy, in others a majority against — mainly because of the waste problem (5). Nonetheless, nuclear power will for some considerable time continue to be indispensable for meeting strongly growing energy demand, as it is an emission-free energy source and as the volume of waste is relatively low by comparison with the energy generated. In the long term nuclear fusion may provide a solution to the drawbacks of nuclear fission.

2.1.5

It should be noted that hydro-electric power sources do not form a subject of a specific paragraph, as this technology (apart from tidal energy) is considered both fully-fledged and fully operational. This should not be seen as detracting in any shape or form from its importance in the sustainability context.

2.2   Biomass

2.2.1

Biomass is organic material from plants and trees specially cultivated for energy purposes. Wood and fast-growing crops are used with a high yield per hectare. By-products from agriculture, the main emphasis being on food, are also used as biomass. Examples are straw and sugar beet crowns. Biomass streams can also be obtained from residues, e.g. waste arising from planting and maintenance and in households, businesses and industry. Examples are fruit, vegetable, and garden refuse, waste timber, manure, slurry, sawdust and cacao shells.

2.2.2

Biomass can be used to (partially) replace fossil fuels. Annual consumption of fossil fuel energy is 400 EJ. Annual availability of biomass energy is 1 250 EJ. But this does not mean that an immediate switch is possible. On the basis of available technology it is currently possible to produce 120 EJ of energy from biomass. Current world consumption of biomass energy is 50 EJ (6). A limited increase in the use of biomass for fuels is therefore possible in the short term, but technological breakthroughs will be needed to enable the potential to be exploited.

2.2.3

A number of initiatives have produced promising results. In Austria there has been a sixfold increase in the use of biomass for district heating, and in Sweden an eightfold increase has been achieved over the last ten years. In the USA more than 8 000 MW of the installed generation capacity is based on the use of biomass. In France 5 % of energy used for heating is produced from biomass. In Finland bioenergy already accounts for 18 % of total energy production and the aim is to increase this to 28 % by 2025. In Brazil ethanol is produced on a large scale as a fuel for cars, currently ethanol provides roughly 40 percent of Brazil's non-diesel fuels (7).

2.2.4

The development of biomass is important from a number of points of view:

a.

Environmental policy: the life cycle of biomass as a renewable material has a neutral effect on CO2 and SO2 emissions. Moreover, when biomass is used on a large scale it is possible to close the mineral and nitrogen cycles.

b.

Agricultural policy: in Europe agricultural land has been taken out of production. It is estimated that 200 million hectares of agricultural land and 10 to 20 million hectares of marginally productive land could be used for the production of biomass as a source of raw materials and energy. The need for more extensive agricultural production must be seen against the backdrop of the need to preserve Europe's rich landscapes, achieve the EU's objective of halting the loss of biodiversity and ensuring sufficient area is set aside for nature protection. Appropriate account of balance in all these areas will need to be taken.

c.

Social policy: in global terms 11 new jobs are created for every megawatt of installed production capacity. If the use of biomass as an energy source in Europe were to rise from 4 % of energy needs in 2003 to around 10 % in 2010 (8), this would mean 160 000 new jobs.

d.

Regional policy: biomass can be used as a decentralised source of energy where conversion takes place close to the production site by means of small-scale power generation plants. This can promote social stability at regional level, particularly in economically disadvantaged areas.

e.

The requirement to produce green electricity: a European directive requires European electricity producers to produce a certain percentage of their electricity from renewable energy sources. This percentage varies from country to country, but is rising steadily. Provision is made for penalties (or the withdrawal of subsidies) if the percentage targets are not met. Clearly, the production of electricity from biomass, either on its own or by burning it together with coal, will make a significant contribution to meeting the targets for green electricity.

2.3   Wind energy

2.3.1

Worldwide the theoretical potential of wind energy is more than twice forecast electricity needs in 2020. This potential and its steadily improving competitive position as a result of technological advances make wind energy an essential replacement for fossil fuels. Wind energy can never cover all needs because of its fluctuating supply.

2.3.2

Over the last few decades installed generation capacity using wind energy has increased spectacularly. The capacity of commercial turbines has grown from 10 KW (rotor diameter 5m.) to more than 4 500 KW (rotor diameter more than 120 m.) (9). Over the last eight years installed generation capacity using wind energy has grown at an annual rate of more than 30 % (10). According to projections by the European Wind Energy Association (EWEA), total wind energy capacity will be sufficient in 2020 to cover 12 % of electricity needs. This implies an increase in wind energy capacity from 31 GW at the end of 2002 to 1 260 GW in 2020, growth of 23 % per year. The market leaders and biggest exporters are the United Kingdom, Denmark and Germany, and the main export markets are China, India and Brazil. The situation is going to change in China where the wind energy machinery industry is growing rapidly. Compared to 2004 the number of producers in China grew by 60 % in 2005. This implies that the European wind machinery industry may face the same scenario as the solar panel industry and lose massive market share to its Chinese competitors.

2.3.3

The wind energy sector is still to some extent dependent on various support measures. The most important of these is the price which producers receive for the energy they sell to the grid, together with the certainty of a guaranteed price level for the next ten to twenty years. Thanks to these measures the wind energy sector is a fast-growing industry in some Member States. The disadvantage is that these measures lead to large, centralised wind energy parks making large profits rather than a fine-meshed network of small, decentralised wind energy power plants. Public opinion is increasingly turning against this large-scale phenomenon. Of course at the end of the day wind energy also has to be able to survive on its own without subsidies and feed-in tariffs.

2.3.4

The research and development effort needs to be stepped up in order to further improve the competitive position of wind energy. Constant attention also needs to be paid to legal guidelines and political objectives. Further major challenges are posed by the development of new locations for wind parks at sea and the elimination of uncertainties regarding the implementation of wind energy.

2.3.5

The development of wind energy is important from a number of points of view.

a.

Environmental policy: wind energy is a clean form of energy without emission of CO2 or other pollutants. Its availability fluctuates but is enormous.

b.

Social policy: in 2002 wind energy contributed to employment to the tune of 20 jobs per megawatt of installed capacity. However, as a result of learning effects in the design, manufacture and installation of turbines, employment is not increasing in proportion and the employment impact is expected to fall to 9.8 jobs per megawatt of installed capacity in 2020. This means that employment in the wind energy industry will increase from around 114 000 jobs in 2001 to some 1.47 million jobs in 2020 (11).

c.

Regional policy: due to the support schemes wind energy develops into large, centralised wind energy parks. Because of their profits they are very attractive for investors. The public opinion is turning against this development as it is in favour of fine meshed networks of small, decentralised wind energy power plants.

2.4   Solar energy

2.4.1

There are two ways of using solar energy: to provide heating and hot water, and to produce electricity (12). Solar heating systems are relatively simple and cheap and are already used in many countries.

2.4.2

The main reason to aim for the large-scale use of solar energy is the fact that it is inexhaustible. It has enormous potential worldwide and is, providing it is well designed and constructed, very environmentally friendly.

2.4.3

Solar energy can be harnessed almost anywhere in the world in the variety of ways: from very small systems in remote places through solar panels on the roofs of houses to large solar power generation plants.

2.4.4

Solar heating systems are in widespread use. The largest market for these systems is China, mainly because gas and electricity distribution infrastructure is lacking in rural areas. In such cases solar energy is the most efficient solution. Another large market is Turkey. Between 2001 and 2004 the worldwide sale of solar panels grew by between 10 and 15 % annually. China took 78 % of total world production and Turkey 5.5 %.

2.4.5

In Europe, Germany, Austria, Spain and Greece are major markets for solar heating systems. The governments of Germany and Austria offer financial incentives for the installation of such systems. In some regions of Spain the installation of such systems in new buildings is compulsory. As a result of these support measures Germany and Austria are by far the largest producers of solar heating systems in Europe and account for 75 % of European production. This pales into insignificance, however, compared with the production of such systems in China. Europe has produced 0.8 million m2 and China 12 million m2. The main reason for this is that the Chinese government recognised the importance of solar heating early on and stimulated the production of these systems with a variety of measures in its five-year plans.

2.4.6

Despite its inexhaustibility, solar-generated electricity at present accounts for only a small proportion of our requirements. This is because the cost of solar generation is still considerably higher than electricity from gas or coal-fired power stations. In order to break the vicious circle of low use and high prices solar energy should be used as much as possible as this will lead to major economies of scale in production and installation. And only then can the technology be further renewed and improved.

2.4.7

Moreover, the generation of electricity using relatively small units of variable yield (depending on the sun) requires a different approach to energy than hitherto. The switch to solar energy is something for the medium term, but it is very important that development in the sector be strongly promoted.

2.4.8

Although the photovoltaic (PV) market is growing rapidly, there are in fact only three major markets: Japan, Germany and California. These three areas account for 80 % of global production of solar energy systems. This is encouraged by high subsidies and by paying households a good price for electricity generated in this way. Worldwide production of solar cells in 2004 was equivalent to generating capacity of 1 150 MW. Adding this to the approximately 3 000 MW of generating capacity already installed at the end of 2003 means that in 2005 total capacity grew to around 4 500 MW.

2.4.9

The Japanese market was created in 1994 by a programme of incentives involving 50 % subsidies. The subsidy was reduced by 5 % each year and 2004 was the last year of the programme, in which a 5 % subsidy was available. As the programme created significant demand, Japanese industry benefited from economies of scale. Prices fell each year by 5 %, which kept the consumer price stable. Although the subsidy is no longer available, the market continues to grow at about 20 % annually. This stable demand made it possible for Japanese companies to invest in R&D and in new manufacturing technologies. As a result Japan currently accounts for some 53 % of the world market.

2.4.10

Germany has gone through a similar process, but about five years behind, beginning in 1999. A combination of low-interest loans, subsidies and stable prices for the sale of electricity to the grid resulted in rapid growth of the PV market. As early as 2001 Germany overtook the USA in terms of installed capacity. Local producers developed and half European production (13 % of world production) now comes from Germany. The launch of a new support programme in 2004, with stable purchase prices for electricity guaranteed for the next 20 years, has given the process a new impetus. The German market is now the fastest growing in the world, some 40 % in 2004 and 2005. This domestic demand makes it possible for German manufacturers to develop their production and to switch production to export markets once the domestic market begins to be saturated.

2.4.11

The development of solar energy is important from a number of points of view.

a.

Environmental policy: solar energy is a clean form of energy without emission of CO2 or other pollutants. Its potential is enormous, as every year the earth absorbs 3 million exajoules (EJ) of solar energy. In comparison, the total reserves of fossil fuels is estimated at 300 000 EJ.

b.

Social policy: the development of solar energy will create jobs in designing, improving, producing and installing solar energy systems. On the other hand, jobs will be lost as less big centralised power plants will be needed.

c.

Regional policy: solar thermal energy can be used in distant, poor areas where there is no infrastructure for the distribution of energy. It is a cheap solution for heating and for the supply of hot water.

2.5   Geothermal energy

2.5.1

Geothermal energy can be used by means of heat pumps for heating and cooling buildings. These pumps use only a fraction of the quantity of gas or electricity used by conventional heating/cooling systems. The energy used for heating (or cooling) is taken from the environment (air, water or earth) (13).

2.5.2

The largest markets for heat pumps are the USA, Japan and Sweden, which together account for 76 % of total installed capacity. They are followed by China, France, Germany, Switzerland and Austria. The European market has grown from 40 000 units in 1997 to 123 000 units in 2004. The total market grew by 18 % in 2004. The manufacture and installation of heat pumps is concentrated in countries where governments offered strong financial and other incentives.

2.5.3

Sweden is a good example of this approach. The Swedish government has encouraged the use of heat pumps since the 1990s with measures such as direct financial subsidies, tax breaks and promotional activities. But new legislation applicable to the construction sector laying down detailed temperature requirements for heating systems also contributed to the growth in the use of heat pumps.

2.5.4

In this way a market was created in Sweden for the manufacture of heat pumps. The country now has an established heat pump industry, with three major players on the global market and 50 % of European demand. The Swedish heat pump market is now self-sustaining. The number of heat pumps in use is growing steadily, even without government support measures. More than 90 % of new buildings in Sweden are now equipped with a heat pump.

2.5.5

A similar development has taken place in Austria, where regional government subsidies equivalent to 30 % of the cost of purchasing and installing heat pumps have been available. Austria now has seven heat pump manufacturers. In both countries it was the combination of direct financial support, building regulations and promotional campaigns which ensured that a heat pump industry could develop which is now able to operate without support.

2.5.6

The development of geothermal energy is important from a number of points of view.

a.

Environmental policy: geothermal energy is an inexhaustible, clean and energy saving energy source. Its potential is enormous, as the outer 6 kilometres of the earth's crust stores energy that amounts up to 50.000 times that of all known the known oil and gas stocks in the world (14).

b.

Social policy: the development of geothermal energy will create jobs in designing, improving, producing and installing geothermal energy systems. On the other hand, jobs will be lost as less big centralised power plants will be needed.

c.

Regional policy: geothermal thermal energy offers people in distant areas without any infrastructure for the distribution of energy a cheap solution to provide in their own need of heating and hot water. Electricity is required in order to exploit geothermal energy, but significantly less than is required for direct heating and hot water supply.

3.   Raw material efficiency

3.1

It is not only energy from fossil fuels which is finite, but also reserves of metallic, mineral and biological raw materials for industrial production (15). There is extensive use of raw materials in the industrialised world: 20 % of the world's population consumes more than 80 % of all raw materials.

3.2

This consumption pattern is incompatible with the sustainable use of the natural resources available to us. Based on the assumption that reserves of raw materials are our common heritage and that current and future access to them is a universal and inalienable right, Europe will have to reduce its use of raw materials fourfold by 2050 and tenfold by 2080 (16). The EESC is satisfied with the initiatives in this field like dematerialisation and the Environmental Technology Action Plan (ETAP).

3.3

In the final analysis, every product involves damage to the environment: whether during production, use or disposal at the end of its life cycle. The cycle has many phases: the extraction of raw materials, design, production, assembly, marketing, distribution, sale, consumption and disposal. At each stage different players are involved: designers, manufacturers, dealers, consumers, and so on. An integrated production policy attempts to improve coordination of these phases (for example by taking optimum recycling into consideration at the design stage) in order to enhance the environmental performance of the product throughout its life cycle.

3.4

With so many different products and players involved, it is not possible to draw up one uniform measure that solves all problems. A whole array of policy instruments is required, both voluntary and binding. These instruments have to be implemented in close cooperation with the public and private sectors and with civil society.

3.5

Consumer organisations should also play a more stimulating and supporting role than hitherto. Up until now, many of these organisations have focused mainly on obtaining the best possible product for the lowest possible price. In practice this means that production is not achieved in the most sustainable way.

3.6   Combined heat and power (CHP)

3.6.1

Using the heat produced in the process of generating electricity means a sharp improvement in the efficiency of energy use, despite the technical limitations arising from the distance between the place where the heat is produced (industrial environment) and the place where it is consumed (in the home), which causes a great deal of energy to be lost. Micro-CHP units can operate primarily to meet thermal needs of a building with electricity as a by-product. Alternative products can be configured for electricity demand first with heat as a by-product. Most sales to date have been heat-led micro-CHP, although fuel cells are more commonly configured to satisfying electricity demand.

3.6.2

CHP technology can circumvent this limitation, and at the same time it offers an economic challenge for European industry. CHP is mainly used to heat residential housing and shops and it produces electricity as a by-product. By 2004 some 24 000 units had been installed. CHP can be used with various energy sources. The most promising of these is hydrogen (fuel cell) technology, but this technology first needs to be further developed.

3.6.3

Thanks to subsidies for end users of CHP plant, Japan has made the most progress in developing this technology, partly because fuel cell technology is being strongly promoted there by the automotive industry. The Japanese government wants Japanese industry to develop a leading position in fuel cell technology, as it has already done in solar energy. To this end Japan is promoting and financing research and development and providing purchase subsidies to end users at an early stage of market development.

3.6.4

The development of CHP is important from a number of points of view:

a.

Environmental policy: it is a cheap and energy-saving energy source. On top of that it is very clean, hot water and power produced with CHP leads to 20 % less emission of CO2.

b.

Social policy: the development of CHP will create jobs in designing, improving, producing and installing CHP systems. On the other hand, jobs will be lost as less big centralised power plants will be needed.

4.   Implications of sustainability for a range of sectors

The growth of sectors engaged in research and development in the field of renewable energy technologies shows that there are considerable economic opportunities in sustainable development. These opportunities do not only exist in those sectors where sustainability technologies are being directly developed but also in those in which new technologies have to be implemented.

4.1   Transport

4.1.1

The transport sector is one of the largest users of fossil fuels. In this sector there are promising opportunities for the sustainable use of energy as the numerous useful recommendations in the CARS 21 final report illustrate (17). In addition, better planning of urban development and infrastructure and more intensive use of ICT technology opens up prospects for improving transport efficiency. Combined with further improved combustion engine technology, this will lead to a substantial energy-saving. In the short term there are also promising opportunities for switching partially to other fuels, such as natural gas or fuel from biomass (BTL). In the longer term hydrogen offers attractive opportunities. The hybrid technology now being developed is also a promising interim solution.

4.1.2

The maximum potential market share of fuel from biomass is estimated at 15 %. The EU has set a target of a 6 % market share by 2010. An initial pilot project for producing fuel from biomass on a large scale is already up and running.

4.1.3

Natural gas produces lower CO2 emissions than either petrol (-16 %) or diesel (-13 %) and could take a larger market share given a favourable tax regime. In that way a stable market could develop for both producers and users. The technology is already there. The opportunities are particularly great in relation to urban public transport, as this would enable optimum use to be made of gas filling stations. A 10 % market share would be possible by 2020 (18).

4.1.4

Examples in other countries (particularly Brazil) show that this kind of market share cannot be achieved merely by ensuring that bio-fuel is available. Flanking policies –such as tax incentives, targeted legislation and regulation and promotion– are needed to encourage the consumer to make the switch.

4.1.5

Another side of the coin is that increased use of bio-fuels originating from environmentally sensitive areas (such as palm-oil from South-East Asia) may lead to a large scale destruction of rainforests as these are replaced by palm-oil plantations. The world knows 23 big ecosystems, 15 of which are exhausted or heavily polluted according to a recent study by the United Nations.

4.2   Construction

4.2.1

In construction — e.g. housing — there is enormous potential for more sustainable techniques. It is already possible to build zero-energy houses at little additional cost, particularly considering that any additional costs are quickly recovered from energy savings. Building in this way costs on average 8 % more than traditional construction methods. Economies of scale could narrow the gap to 4 % within ten years. Norman Foster, one of the world's most famous architects, once stated that, if you look at the total costs of a building over a period of 25 years, the actual building costs are only 5.5 %. The costs of occupying the building (energy, large- and small-scale maintenance, interest rate on mortgage/lease) account for up to 86 % over that same period of time. So, while building in a sustainable way may be slightly more expensive in the short term, it is considerably cheaper in the medium to long term.

4.2.2

In Germany and Austria energy-efficient construction is growing faster than in the rest of Europe. The Passiv Haus Institut in Germany has commissioned housing designs which use very little energy by using solar energy in combination with efficient, air-tight insulation. More than 4 000 houses of this type have now been built in Germany and more than 1 000 in Austria. The principle is also increasingly being used in the construction of commercial buildings.

4.2.3

The municipality of Freiburg has laid down new rules on energy-efficient construction. These rules are an integral part of every lease or purchase agreement which the local authority enters into with builders and property developers. In this way the local authority is making optimum use of its legal powers in order to promote energy management on a large scale. The agreements state that any construction on land purchased or leased from the local authority must be done in accordance with energy-efficiency guidelines; buildings are to be designed to make maximum use of solar energy and roofs must be suited to the installation of solar panels. In areas where buildings are constructed in this way savings of 40 % are achieved on hot water use.

4.3   Industry

4.3.1

The Committee welcomes the Commission's approach to industrial policy taking account of sustainability concerns, as promulgated in its Communication entitled Implementing the Community Lisbon Programme: A policy framework to strengthen EU manufacturing — towards a more integrated approach for industrial policy (19). The achievement of the Lisbon goals requires a competitive European industry. Therefore the EESC welcomes the setting-up of a High Level Group on Competitiveness, Energy and the Environment, one of the seven major cross-sectoral policy initiatives designed to reinforce the synergies between different policy areas in the light of competitiveness considerations. The Committee also welcomes the efforts made by the European industry itself in this field.

4.3.2

At present, industry remains largely dependent upon fossil fuels. However, in numerous instances the choice of electric process permits the use of all types of primary energy sources while, in the majority of cases, simultaneously making for energy savings (20). There are also ways of exchanging residual energy between industrial complexes and other sectors or residential complexes. Thus, the residual heat of the Europoort industrial complex is used to heat the largest greenhouse complex in north-western Europe, 20 kilometres away in Westland.

4.3.3

Crude oil is the basis for the chemicals industry but in the future less of it will be available. An alternative is biosynthesis, the production of basic chemicals from biomass using bacteria, a very complex but also promising area. In recent years a great deal of progress has been made in relation to our knowledge of the genetic make-up of micro-organisms such as bacteria. New technologies make it possible to modify these organisms genetically so that they convert the original material into specific substances. The bacteria become a sort of programmable mini-reactor.

4.3.4

At present the food and pharmaceuticals industries use this micro-organism technology, e.g. in the production of cheese, beer and penicillin. The opportunities for bioconversion are considerable in these sectors too, but the chemicals industry is now also beginning to take an interest in the technology. A whole series of reaction steps are needed to obtain substances from crude oil and purify them. The technology needs to be developed much further but it is theoretically possible to switch to the direct conversion of biomass into basic chemicals and other products. This will reduce the need to use oil, with all the attendant economic and environmental benefits — emissions reduction, closing of the circuit and management of the chain.

4.3.5

Energy-intensive sectors may encounter particular problems in ensuring gradual transition to renewable energy sources. The level of sustainability of production is a direct function of the level of technology employed and no major improvements in this domain are to be expected in the near future. The steel and aluminium sectors in Europe, for instance, are already performing well in this area. Whereas the steel industry is investing a great deal in new technologies for more sustainable production, especially through the ULCOS project (Ultra Low CO2 Steelmaking, the largest European steel project ever) and expects CO2 emissions to be halved by around 2040, the production of primary aluminium in Europe is characterised by a remarkably high–level use of renewable energy (44.7 %). Since the energy used in producing secondary aluminium out of aluminium scrap is only 10 % of the energy needed for the production of primary aluminium there is a major potential for energy saving in this sector. However, aluminium scrap in the European market is being purchased massively by China through governmental incentives aimed at saving energy.

4.3.6

The European steel industry also does well in the field of raw material efficiency and recycling. Half of the world's steel is produced using scrap metal. Optimum use is also made of recycled waste. At the Corus plant at IJmuiden 99 % of waste is re-used either on site or externally.

4.3.7

Although the use of fossil energy sources as a raw material for industrial production will, to a great extent, be unavoidable for the foreseeable future, the use of newly developed materials will help save energy in the applications area, e.g. by reducing weight in vehicle manufacturing. In order to promote such innovation the European industry has to preserve its international competitiveness, beginning with the extractive industries where the value-creation chain starts.

5.   Social aspects

5.1

The need for gradual transition to sustainable production is unavoidable and undisputed. Deindustrialisation, the transfer of production to other regions and increasing competition from developing economies has led to uncertainty and fear. In this climate people have tended to believe that switching to more sustainable production will adversely affect Europe's competitiveness, hinder the growth of industry and destroy jobs, and that it is bad for the economy and for employment.

5.2

There have been negative effects on employment in Europe. In Germany studies predict that 27 600 jobs will be lost by 2010 due to the Emissions Trading Scheme (ETS), rising to 34 300 by 2020 (21). Yet another 6 100 jobs will be lost in Germany by 2010 as a result of the implementation of the renewable energy law (22). Finally the implementation of the Kyoto-protocol agreements will have destroyed another 318 000 German jobs by 2010 (23). These figures must be set against the number of jobs created, which shows that a policy geared towards climate protection goals really entails ‘industrial change’: for example, the EUR 16.4 billion for which the renewable energies sector in Germany accounted in 2005 and the 170 000 jobs that have so far been created in this sector (24). With production amounting to EUR 55 billion (2004), the environment and climate protection sectors in Germany currently provide some 1.5 million jobs and contribute EUR 31 billion to German exports (2003), thus helping to secure many more jobs (25).

5.3

However, the impact is not only negative. A survey of job losses in Europe shows that less than 5 % of jobs lost have disappeared as a result of the transfer of production to other regions (26). In spite of methodological limitations arising from data collection techniques, this survey remains a useful source of information, particularly when taken in tandem with other relevant indicators. It could be argued further that only a small percentage of that job-loss is due to environmental legislation.

5.4

There has also been a growth in jobs. The eco-industry engaged in research and development in the field of sustainable technologies is a dynamic sector which is increasing employment by 5 % annually. This sector, with more than two million direct, full-time jobs, now provides as many jobs in Europe as the pharmaceutical and airspace industries (27).

5.5

An OECD study (28) has shown that sustainable production does not by definition lead to higher costs. In the long-term it can even reduce costs to some extent. Moreover, sustainable output can be counterbalanced against these costs. Clear commercial advantages, environmental legislation and ancillary regulation lead to investment in sustainable innovation, encourage more efficient use of raw materials, strengthen brands, improve the image of businesses and ultimately lead to greater profitability and employment. In order to be successful this process needs a common approach based on shared responsibility from business, labour and government.

5.6

To be avoided at all costs is that European industry suffers a significant competitive disadvantage when compared to regions outside the EU due to higher costs resulting from environmental and social laws and regulations. When Europe sets standards for sustainable production for its own industry it is unacceptable and beyond reason if, at the same time, it allows producers from outside the region to bring products to the market that are not produced in compliance with those standards. To stimulate sustainable production a two-pronged approach is needed: internally to the EU on the one hand and externally to the EU on the other.

5.6.1

Regarding the former, appropriate instruments should be introduced to ensure that social and environmental costs resulting from non-sustainable production methods within the European Union be internalised in the price of the goods to promote the main thrust of the report of the World Commission on the Social Dimension of Globalisation for policy coherence among the ILO, WTO, IMF and World Bank, as pointed out in the EESC opinion on ‘The Social Dimension of Globalisation’.

5.6.2

In terms of the latter, the EU should make every effort in relevant international fora (in particular WTO) to include non trade concerns such as fundamental social and environmental standards into international agreements on trade to facilitate the upgrading of the sustainability policies of Europe's competitors. Countries such as the United States, India and China have an unfair economical advantage compared to Europe as long as they are not bound by the Kyoto protocol's CO2 reduction targets. Those agreements should be implemented on a global scale as trade can only be really free when it is also fair.

5.7

The European eco-industry now has roughly a third of the world market and generates a trade surplus of more than EUR 600 million. In 2004 exports grew by 8 %, and this is a growth market because in the future all countries, even China and India, will increasingly switch to sustainable products and production processes.

5.8

The sustainable, innovative society towards which we have to move needs a thorough information campaign aimed at citizens and consumers to raise awareness and to provide a broad social basis. It also needs well-trained workers. In the recent past, Europe paid too little attention to this. The English text of ten European directives in this area (sustainability, innovation) has been scanned for the words ‘training’, ‘learning’, ‘skilling’ and ‘education’, and only the first of these occurred, once, in one directive.

5.9

A number of Commission communications which preceded these directives dealt at length with the need for training. That interest was entirely missing in the directives, however. Communications are just words, whereas directives are deeds. A policy is not what you say, it is what you do. The EESC welcomes the fact that a lot of attention is paid to the importance of education in the new EU industrial policy and encourages the Commission to continue in the same vein.

5.10

In the Lisbon Strategy Europe has set itself the objective of becoming by 2010 the most competitive knowledge-based economy in the world with more and better jobs and greater social cohesion. A well-trained workforce is needed to build and maintain this kind of society. If we do not invest enough in training our workers, not only will we not achieve the Lisbon objectives by 2010. We will never achieve them.

Brussels, 14 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  COM(2005) 658 final, 13.12.2005.

(2)  Energy triad — an approach to energy sustainability developed by Delft University of Technology.

(3)  Source: Energie Centrum Nederland, www.ecn.nl.

(4)  COM(2006) 105 final, 8.3.2006.

(5)  Eurobarometer issues 227 (on nuclear energy and waste, June 2005) and 247 (Attitudes towards Energy, January 2006.

(6)  Source: Energie Centrum Nederland, www.ecn.nl.

(7)  www.worldwatch.org.

(8)  Biomass Action Plan, Communication from the Commission (SEC(2005) 1573).

(9)  Source: Energie Centrum Nederland, www.ecn.nl.

(10)  Sources: www.ewea.org and www.wind-energie.de.

(11)  Source: Energie Centrum Nederland, www.ecn.nl.

(12)  See Appendix I.

(13)  See Appendix II.

(14)  Source: Informatiecentrum Duurzame Energie.

(15)  See EESC opinion entitled Risks and problems associated with the supply of raw materials to European industry.

(16)  Review of the European Sustainable Development Strategy.

(17)  CARS 21 High Level Group: Competitive Automotive Regulatory System for the 2st century.

(18)  Source: COM(2001) 547, Directive 2003/30/EC on the promotion of the use of biofuels and other renewable fuels for transport, ALTERNATIVE FUELS REPORT OF THE ALTERNATIVE FUELS CONTACT GROUP DECEMBER 2003.

(19)  COM(2005) 474 final, point 4.1.

(20)  See Electricity for more efficiency — Electric technologies and their energy savings potential (July 2004):

http://www.uie.org/library/REPORT_FINAL_July_2004.pdf.

(21)  ‘Zertifikatehandel für CO2-Emissionen auf dem Prüfstand’, 2002, Arbeitsgemeinschaft für Energie- und Systemplanung (AGEP)/Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI).

(22)  ‘Gesamtwirtschaftliche, sektorale und ökologische Auswirkungen des Erneuerbare-Energien-Gesetzes (EEG)’, 2004, Energiewirtschaftliches Institut an der Universität zu Köln (EWI, Köln), Institut für Energetik und Umwelt (IE, Leipzig), Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI, Essen).

(23)  ‘Das Kyoto-Protokoll und die Folgen für Deutschland 2005’, Institut für politische Analysen und Strategie (ipas) in cooperation with the International Council for Capital Formation (ICCF).

(24)  German Environment Ministry press release No 179/06 of 10.7.2006.

(25)  German Environment Ministry press release No 81/06 of 20.4.2006.

(26)  www.emcc.eurofound.eu.int/erm/.

(27)  Hintergrundpapier ‘Umweltschutz und Beschäftigung’ Umweltbundesamt, April 2004.

(28)  www.oecd.org/dataoecd/34/39/35042829.


23.12.2006   

EN

Official Journal of the European Union

C 318/12


Opinion of the European Economic and Social Committee on The territorial governance of industrial change: the role of the social partners and the contribution of the Competitiveness and Innovation Programme

(2006/C 318/02)

At its plenary session of 19 January 2006, the European Economic and Social Committee decided, under Rule 29(2) of its Rules of Procedure, to draw up an opinion on The territorial governance of industrial change: the role of the social partners and the contribution of the Competitiveness and Innovation Programme.

The Consultative Commission on Industrial Change, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 31 August 2006. The rapporteur was Mr Pezzini and the co-rapporteur was Mr Gibellieri.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 181 votes to two with eight abstentions.

1.   Conclusions and recommendations

1.1

The March 2006 European Council centred on the relaunch of the Lisbon strategy for growth and employment and on an integrated, governance-based approach to the new challenges of globalisation.

1.2

The EU must be committed to securing innovative, competitive and sustainable development for its people, in order to secure greater economic and social cohesion and spark the generation and development of new businesses, new professional profiles and more and better jobs, while preserving the European social model and focusing on a knowledge-based economy.

1.2.1

The Committee is strongly convinced that without ‘a new governance cycle based on partnership and ownership’ (1), all Europe's efforts at boosting competitiveness and employment will be in vain, and that new models for governance must be adopted and implemented rapidly and widely.

1.2.2

The Committee feels that both the seventh RTD Framework programme (FP7) and the new CIP are still excessively top-down in their outlook and do not yet allow for the appropriate level of integration and responsible participation of public and private development players at local and regional level, optimising the essential role of the social partners to promote sustainable and lasting growth.

1.3

The European Union ought to encourage this type of partnership at local level with authorities and economic players and especially with the social partners, not least through the two instruments mentioned above, in order to nurture a new generation of territorial pacts for development within the context of globalisation (2).

1.4

The EESC is convinced that there is no one form of governance to suit all. Each regional/local tier must seek the formula that best services the requirements of local or regional governance, while remaining compatible with the national, European or international frame of reference.

1.5

There are however certain common features:

structured civil and social dialogue;

regular public assessment of the quality and impact of the actions taken;

the training of development agents and integrators;

structured bridges between academia, industry and government;

high-quality education and training structures;

connection with networks of centres of technological and scientific excellence;

the creation/strengthening of advanced groupings (districts, high-tech parks, production and financial conglomerates, etc.);

an equipped, sustainable, attractive and IT-friendly region;

effective and accepted structures for reaching consensus and decision-making, based on public involvement.

1.5.1

Lastly, it is absolutely essential that this integrated regional policy include a structured social dialogue, not least by making more of existing local/regional economic and social councils with the social partners and representatives of organised civil society and by establishing effective forms of economic and social partnership (3).

1.5.2

In this respect, the route indicated by the EESC should be followed, involving the ESCs and similar bodies of individual European countries in a structured dialogue with the EESC.

1.6

The success of this new form of governance depends increasingly on the capacity to pinpoint the most effective degree of proximity for managing problems and finding solutions, in accordance with the principle of subsidiarity, while also maintaining a coherent framework and shared vision with other levels of intervention (4).

1.7

The Committee is convinced that the practice of exploring possible routes, actions and measures with a medium- to long-term view, shared by means of foresight exercises, can make a real bottom-up contribution to the cultural growth of society and can help to enrich the choices of politicians and administrators. Most importantly, it can also nurture and strengthen the local interaction between technological, economic, social, political and cultural sectors necessary for ensuring sustainable and competitive development.

1.8

First and foremost, the social partners and representatives of organised civil society must be involved in forming a clear understanding of strengths and weaknesses with a view to finding new niches on the internal and international market.

1.9

Globalisation generates competitive pressure to modernise, innovate and move up the value chain, and enables goods and services to be produced and distributed more efficiently and cheaply. However, there is a danger that if nothing is done in time, it will generate new divisions and fragmentation in the economic and social fabric, particularly at local and regional level.

1.9.1

This, in the Committee's view, necessitates the formation of new areas of responsibility as soon as possible in order to guide the public through the changes. Joint training measures should be set up for district managers, business leaders and financial and credit system managers, to be implemented in conjunction with politicians, public sector officials and local and regional authority managers.

1.10

Only an integrated and jointly-framed territorial approach will ensure that knowledge accumulated through investment in research and development, innovation and education can generate the capacity for innovation, giving the European industrial base a competitive edge and enabling it to attract human and financial resources.

1.10.1

In that context, it is of the utmost importance to examine new ways of attracting human resources to a region, not least by improving work-life balance and introducing incentives, especially for white collar and highly qualified workers, such as managers, researchers and industry experts, securing for them sufficiently attractive benefits in their working life.

1.11

The new CIP programme (2007-2013) cannot be looked at in isolation from the Community's other regional policies and programmes. It aims to address the issues by means of a three-pronged approach: the Entrepreneurship and Innovation Programme; the ICT Policy Support Programme; and the Intelligent Energy Programme.

1.12

In that light, the Committee is in favour of strong coordination of the CIP with regional and cohesion policy and cross-border, transnational and interregional cooperation measures as well as with the VIIth RTD framework programme (FP7). A significant part of the latter's ‘Capacities’ programme is also devoted to developing R&D in SMEs, the Regions of Knowledge, support for innovation and innovative services for companies and the necessary links between the world of training and that of enterprise.

1.13

The Committee believes it is essential that these initiatives be carefully coordinated to secure synergy and avoid overlaps or inconsistencies. They should be restyled and taken on board by each region, giving priority to partnership for jointly-framed local development.

1.14

The Committee would reiterate, lastly, the views it has already expressed in a recent opinion on the subject of modern industrial policy: ‘What is missing is a clear link between the efforts at EU level, and the necessary involvement of governments, industry and stakeholders at national and regional level.’

2.   Definitions

The opinion refers to a number of concepts whose definitions are provided below.

2.1

Governance: anthropological literature draws a distinction between three types of Governance (5). Grassroots governance involves the local coordination of all players, and is characterised by a marked orientation towards all kinds of technology-related activities. Network governance shows a high level of coordination between networked players, in particular firms, research organisations and funding organisations. Dirigiste governance is based on a high level of coordination and central management of key aspects such as funding and research competence.

2.2   Socially responsible area  (6)

An area can be defined as being socially responsible when it gears its development towards sustainability, thus tying in the economic, social and environmental dimensions. An area can define itself as socially responsible if it succeeds in:

building social and environmental considerations into economic decisions;

using a shared system of values and a participatory methodology in decision-making processes;

encouraging good practice and continuous pooling of ideas among stakeholders, in order to boost innovation and competitiveness.

In order to plan for a socially responsible area, it is necessary to:

identify the community living there;

identify its guiding values.

2.3   The social capital of an area

Social capital can take many forms: cooperative or competitive cultures; a shared sense of community, or polarised interest groups; differing modes of learning. Cultural traditions and types of organisation can have a considerable impact on the obstacles that might obstruct the creation of a socially responsible area. A more in-depth study of the social resources available in an area (social capital) calls for a distinction to be drawn between: institutional capital, cultural capital, symbolic capital, psychosocial capital and cognitive capital.

Institutional capital: the capacity of the formal institutions in an area to concentrate on problem- solving, their capacity to act, their speed in decision-making, the quality of information available to organisations, their flexibility, and lastly existing inter-organisational relations.

Cultural capital: the heritage of a region's traditions, values and beliefs, the richness of its language, and lastly social relations and behavioural patterns (7).

Symbolic capital: the potential of a region to mobilise the energy necessary to secure its own development and its potential to provide an emblem for local companies.

Psychosocial capital: this is based largely on trust, on the conviction that there is a community and that it has the potential to develop and, lastly, on an awareness of the possibility of cooperation with groups and associations.

Cognitive capital is represented by collective know-how, not to be confused with the human capital of individuals. Cognitive capital resides in the knowledge infrastructure of organisations such as universities, research centres, cultural and professional organisations, companies and bodies responsible for social dialogue (8).

2.4   Foresight (9): the future as a social construct

The future has to be built. It is people who build it, through their actions and the sometimes unexpected consequences of them. It is not simply a matter of telling the future but of building it socially. The systematic consideration of probable or possible events can contribute to this process. The systematic study of the future is an area of research that seeks to shape a future that reflects our hopes more closely. The aim of foresight is not therefore to tell the future, but to imagine a future that is different from the present, made possible by factors such as changes in technology, lifestyle, working habits, regulations, world geopolitics, etc.

2.4.1

With a view to underscoring the guidelines established by the Lisbon European Council, the Commission laid the foundations for the European Research Area (ERA) (10), the financing for which was built into the VIth Framework Programme, with particular attention to territorial foresight (11). Later, in 2001, the Commission launched its ‘Science and technology foresight; links with the IPTS (12)’ unit, designed to promote foresight as a model for innovation.

2.5   Grassroots democracy

2.5.1

The idea of grassroots has gained importance in recent years along with other concepts such as subsidiarity. A grassroots culture enables members of the public to show they want to play a part in decisions relating to the social sphere. Thanks to new technologies, knowledge is spreading at a speed and on a scale that were previously unthinkable.

3.   Reasons

3.1

As the third millennium begins, the EU is facing profound structural changes that in the space of just a few years have revolutionised the world environment in which the European economy works and competes. These include the following in particular:

the workforce present on the open market has doubled with the entry of more than two billion people into the market economy area governed by the WTO;

the economic revolution brought about by globalisation has altered firmly-established economic models, tilting the balance between supply and demand;

new economic competitors have emerged, some in groupings, and have joined the traditional market players;

companies are seen increasingly as integral parts of a system, providing integrated knowledge networks;

company success is increasingly dependent on the new form of public territorial governance that must operate within a shared strategic vision;

new forms of public and private governance at local and regional level coexist within a world context that shows strong demographic and economic imbalances;

on the new global liberalised market, new aggressive strategies for economic and commercial penetration have taken hold, targeting largely the weak points in foreign markets in order to gain a competitive advantage.

3.2

The Aho (13) report reiterated the need for new models of governance, in order to make Europe competitive and aware of the challenges to the system brought by structural change.

3.2.1

The adoption of this new model for governance requires:

a clear change to achieve a genuinely unified European market, in order to promote innovation and market new products and services, and countering the fragmentation that is the main barrier to investment, business and employment;

a review of EU worker mobility schemes: this should include channels for exchange and mobility between science, industry and government and between countries; new instruments for dialogue are also needed, to make more of the European knowledge-based social model and to sow the seeds for new generations of knowledge-based districts, new technology and industrial parks, poles of excellence, technological platforms and clusters;

a new common strategic vision, using participatory foresight instruments, to address internal social challenges and external economic challenges and to bridge the gap between political ideas and the practical need to involve all those regions wishing to be part of the knowledge-based economy;

the development in the regions of highly professional ‘development integrators’ (14);

support for the creation of the European Institute for Technology (15) in order to stave off a brain drain and attract professionals from other parts of the world so as to develop and boost research and innovation within the EU;

bold European measures to support vocational retraining and the preparation of relevant multidisciplinary profiles.

3.3

Research and development, design, manufacturing systems, logistics systems (16), marketing and client services are increasingly integrated as functions, acting together as a single entity that links clients with the inventors of new products.

3.4

Modern company structure has ever less to do with the availability of physical infrastructure and ever more to do with the ownership of intangible assets. It requires an equipped region, with structures for territorial governance, able to sustain the capacity to produce and distribute goods and services and to provide the best possible after-sales service.

3.5

Developing a clear regional or local identity, reflected in the social capital, is proving to be fundamental, both to prevent the risk of relocation, and because new business developments demand specific characteristics and a high quality of locally available services. These standards can be obtained only with well-trained staff with a high level of awareness.

3.6

Awareness of regional/local identity among the public, political decision-makers and social partners allows an integrated approach to environmental and social sustainability, which brings added value when it comes to attracting new investment.

3.7

Regional/local identity as a quality is based on a combination of belonging, recognition and empathy regarding a set of shared values and a shared vision of the future. Promoting regional/local identity involves:

transparent, participatory models of governance, made possible through: the distribution of powers among the various players and public and private decision-making centres, capacity building activities designed to secure an optimal organisational, management and operations structure, and the sustainable use of local resources, including transport, health services, physical resources, infrastructure and ITC services;

the development of a ‘pleasing’ image for the area;

SWOT analyses (17);

participatory foresight exercises, to foster awareness of a shared vision/path;

networking and the exchange of best practice between regions;

benchmarking exercises to secure comparative territorial advantages.

4.   The integrated territorial approach (ITA) and foresight systems for local and regional research and innovation

4.1   ITA and local human resources

4.1.1

There are various priority areas for actions when it comes to making the most of local human resources:

a shared common strategic vision (foresight) of medium- and long-term prospects for local and regional technological and innovative development;

structured social dialogue at local and regional level; in this respect it is essential that existing legal requirements regarding information and consultation are fully upheld (18);

training through high-quality structures designed to keep workers permanently skilled for the professional profiles necessary for future regional development, in a context of global competition;

the use of the many social tools available to assist workers hit both by unexpected market changes that exclude them from development possibilities and by local and regional decline in crisis areas;

policy geared towards social inclusion and respect for ethnic minorities;

intelligent and responsible management of flexibility to broaden opportunities for professional achievement (‘flexicurity’ (19));

full public involvement.

4.2   ITA and the development of a new, stronger form of entrepreneurship

4.2.1

An integrated territorial approach can encourage and promote the creation and development of businesses, SMEs in particular, by establishing a favourable environment. This involves:

cutting red tape and removing bureaucratic obstacles to the setting-up and development (in size, for instance) of companies;

providing structures for vocational and other training, apprenticeships and lifelong learning, managed by the social partners by means of bilateral bodies working on the basis of forward-looking projects;

establishing integrated networks between universities, companies and research centres with standardised work programmes, methodologies and structures, all geared towards technology transfer;

setting up and relaunching new industrial and technological knowledge-based districts and integrated industrial platforms: within these the players in the technology sector expand to take in new centres of learning and applied research and look beyond their immediate neighbourhood to develop production and distribution systems that focus on the shared values and strategies of ‘learning communities’;

establishing (e.g. through regional development agencies) networks of industrial and technology parks, in order to develop well-equipped regions, able to offer services to aid the development of new businesses;

improving access to sources of funding and credit, not least by implementing mechanisms such as those promoted by the JEREMIE initiative (Joint European Resources for Micro to Medium Enterprises) throughout the EU;

developing and disseminating mechanisms for corporate social responsibility;

promoting and strengthening systems for cooperation between social partners and local economic and social players, by boosting their institutional capacities and potential for social dialogue;

modernising the local digital system for communication between all political, economic and social players present in the area and the relevant public and private authorities and institutions. The focus should be on instruments such as e-government, e-business, e-commerce and distance working, as well as high-capacity broadband communication networks, such as the GEANT (20) network for data transmission and the GRID systems (21);

bolstering the values upheld by the JESSICA programme, aimed at the integration of city peripheries;

providing a physically, economically and socially secure environment for the public, companies and the world of work;

making the integrated territorial approach to local and regional industrial policy sustainable, by optimising environmental protection during economic and industrial change.

4.3   ITA, CIP and the seventh framework programme — Consistency with other Community policies

In 2005, the Heads of State or Government gave further political impetus to the relaunched Lisbon strategy, in particular by emphasising the way in which European values can underpin modernisation of the economy and society in a globalised world.

4.3.1

The March 2006 European Council set out the priorities to pursue in the context of the renewed partnership for growth and employment:

greater investment in knowledge and innovation;

unlocking business potential, especially of SMEs;

increasing new and sustainable employment opportunities for priority categories, especially for young people (22), women, older workers, people with disabilities, legal immigrants and minorities.

4.4

More specifically, the CIP Entrepreneurship and Innovation Programme ties into a coherent framework many activities designed to address key problems affecting competitiveness and innovation in the EU's economic and social fabric, by directing development towards innovative and productive measures, protecting the environment and making efficient and socially acceptable use of resources.

4.5

The FP7 specific ‘Capacities’ programme is intended to enhance capacity for research and innovation, in particular:

by meeting the needs of SMEs needing to outsource research activities;

by encouraging the transnational networks of Regions of Knowledge, in order to foster the emergence of clusters, metadistricts and technology and business parks, associating universities, research centres, companies and regional authorities;

by tapping into the research and innovation potential of the Convergence Regions and outermost regions, in conjunction with action through the Structural and Cohesion Funds.

4.5.1

Optimising the participation of SMEs in research and innovation activities will also involve the other FP7 specific programmes (i.e. ‘Cooperation’, ‘Ideas’, and ‘People’).

4.5.2

The need to make full use of research results is also fundamental and a common feature of all the programmes, and this is done most effectively at territorial level. In this light, there must be high levels of coordination, consistency and synergy with the Community's regional and cohesion policy instruments and other Community support instruments for regional cooperation and education and training.

4.5.3

Furthermore, the above-mentioned actions must be coordinated with regional policies related to the reformed European Structural Funds.

4.6

In order to be properly assimilated in the field, these initiatives, as well as being closely coordinated in order to secure synergies and prevent overlaps or inconsistencies, must also give priority to:

a receptive, well-equipped environment able to generate synergistic effects with relevant regional and local programmes, able to develop international research partner networks, in order to meet the transnationality criteria of European projects and translate research results into real competitive growth and higher employment, targeting current industrial change by means of permanent territorial networks promoting interaction between universities, industry and research centres;

advanced education and training structures designed to provide a functional response to the demands of economic and industrial development, based on knowledge: these structures should be based on training schemes geared towards new technology-production, distribution and consumption models, and on lifelong learning systems anticipating responses to industrial and market changes;

institutional and association-based capacity building and social dialogue initiatives, with a view to planning effectively and optimising research and technology transfer: all these elements must work to a vision shared by the economic and social players experiencing reality at first hand in the field and must be aimed at giving people new business and training opportunities, advanced qualifications and new professional profiles;

an integrated regional policy able to make the most of local development potential, enhancing capacity for change and innovative anticipation, in order to enjoy the benefits of new flows of goods and services, human resources and capital generated by globalisation;

consolidated social dialogue at regional/local level, as a key to maximising the benefits of anticipating industrial and market change and education and training flows; this dialogue must also deliver better job security and greater flexibility in the organisation of production, distribution and services.

4.6.1

The Committee feels that both the seventh RTD Framework programme (FP7) and the new CIP, on which it has already issued opinions, are still excessively top-down in their outlook and do not yet allow for the appropriate level of integration and responsible participation of public and private development players at local and regional level as is both necessary and desirable. This approach does not in effect give local players their rightful role as joint guardians of European governance.

4.6.2

The European Union ought to encourage this type of partnership at local level with authorities and economic players and especially with the social partners, not least through the two instruments mentioned above, in order to nurture a new generation of territorial pacts for development within the context of globalisation (23). These should involve all the stakeholders in economic and employment development, with a view to responding effectively to the challenges of the market and competitiveness, moving beyond local mindsets that are becoming dangerously restrictive in a world of interconnected realities.

4.7   ITA, participatory governance, the social partners and civil society

4.7.1

A considerable proportion of sustainable competitiveness measures fall within local and regional responsibility, making governance systems and cooperation between the various local and regional authorities, the various bodies and institutions, the social partners, companies, and civil-society players active in the field a priority.

4.7.2

With regard to the concept of governance, reference should be made to comments made previously by the Committee on the subject: ‘private stakeholders must act and take responsibility through tangible contributions and actions. […] Social and civil dialogue are important accompanying measures’ (24).

4.7.3

As far as strengthening social dialogue is concerned: ‘The EESC agrees […] that, by virtue of their sectoral knowledge, the social partners are able to play a special role in alerting the authorities.’

4.7.4

In the Committee's view, it is a matter of implementing streamlined, proactive and reactive jointly-framed social engineering and decision-making systems, able to maintain a high quality of political, economic and social democracy, without weighing down and holding back the development of actions and initiatives.

4.7.5

The development of a shared medium- to long-term vision is essential here, as is the identification and division of responsibility regarding agreed intermediate objectives, and the use of advanced and proven tools at regional level such as foresight.

4.8

The ITA is a governance strategy for the development of socially responsible regions.

4.8.1

In a context like ours, open to global competition, any governance strategy for socially responsible local and regional development must secure a sustainable trend towards economic development and high social standards. Such a strategy should in particular involve:

constant improvements in quality and the cognitive and innovative capacity of the local and regional production system, through systematic analyses and the jointly-framed forecasting of social, economic and technological development;

the development of global reference networks for the public and private sectors, ensuring a constant and clear two-way flow of interactions with the global market;

high levels of environmental and social sustainability in the development of both production and consumption;

efficient and consolidated processes for the formation and dissemination of knowledge, information and on-going training for technology operators, users and final consumers;

the preparation of ‘local and regional social balance sheets’ able to measure, monitor and assess the trends that help qualitative and quantitative objectives to be met, on the basis of shared standards and methodologies at European level.

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  See Presidency conclusions of the European Council meeting of 23-24 March 2006, paragraph 4.

(2)  See: Pacte Industrial de la Regio Metropolitana de Barcelona ( http://www.pacteind.org/eng/activities/) which states that The territory's competitiveness lies in the quality of the companies and their workers, …’.

(3)  See European Commission guidelines on cohesion policy: An active horizontal partnership (Social partners, organised civil society, administrators); An effective vertical partnership (European Commission, national governments, local and regional governments). See Regulation EC/1260/1999 of 21.6.1999 and COM(2002) 598 of 7.11.2002.

(4)  See ‘Grassroots democracy’.

(5)  P. Cooke et al, 1998, Regional Innovation Systems — The role of governance in a globalised world.

(6)  This concept underpins the new JESSICA programme, launched by DG Regio, financed by the EIB and aimed at particularly run-down city areas.

(7)  In anthropological terms, culture consists of forms of behaviour that are acquired and transferred through symbols, actions, signs and the fruit of intellect (Alberoni, Consumi e società).

(8)  F.Alburquerque et al, Learning to innovate, OECD seminar 30.9 — 1.10.1999 Malaga, Spain.

(9)  Definition of foresight: Systematic, participatory process that involves the gathering of information and the development of visions for the future, in the medium and long term, designed to direct decision-making and mobilise means for joint action.

(10)  COM(2002) 565 final of 16/10/2002.

(11)  http://www.cordis.lu/rtd2002/foresight/main.htm.

http://www.cordis.lu/rtd2002/foresight/main.htm.

http://www.regional-foresight.de/.

http://prospectiva2002.jrc.es/.

(12)  Institute for Prospective Technological Studies. This is one of the seven institutes that fall under the JRC (Joint Research Centre).

(13)  ‘Creating an innovative Europe’, report of the Independent Expert Group on R&D and Innovation, chaired by Esko Aho, January 2006.

(14)  People with social and technological experience who, with the help of technological poles, are able to help micro and small companies with innovation processes.

(15)  See European Council Conclusions of 15 and 16 June 2006.

(16)  See ‘European logistics policy’.

(17)  SWOT: Strengths and Weaknesses, Opportunities and Threats Analysis.

(18)  See ETUC document: ‘Restructuring and employment — Anticipating and accompanying restructuring in order to develop employment: the role of the European Union’ (ETUC Executive Committee, Brussels, 14 and 15 June 2005).

(19)  Flexicurity: the case of Denmark, ECO/167 — Rapporteur: Ms Vium.

(20)  The GEANT project grew out of collaboration between 26 National Research and Education Networks representing 30 countries across Europe, the European Commission, and DANTE (Delivery of Advanced Network Technology to Europe). Its principal purpose was to develop the GÉANT network — a multi-gigabit pan-European data communications network, reserved specifically for research and education use.

(21)  GRID: a system that integrates and coordinates resources and users that live within different control domains for example, the user's desktop vs. central computing, different administrative units of the same company, or different companies, and addresses the issues of security policy, payment, membership, and so forth that arise in these settings.

(22)  See, for instance, the ‘youth pact’ established by the French Government.

(23)  See Pacte Industrial de la Regio Metropolitana de Barcelona ( http://www.pacteind.org/eng/activities/) which states that The territory's competitiveness lies in the quality of the companies and their workers, …’.

(24)  See The road to the European knowledge-based societythe contribution of organised civil society to the Lisbon Strategy (exploratory opinion) — Rapporteurs: Mr Olsson, Ms Belabed and Mr van Iersel.


23.12.2006   

EN

Official Journal of the European Union

C 318/20


Opinion of the European Economic and Social Committee on The contribution of IT-supported lifelong learning to European competitiveness, industrial change and social capital development

(2006/C 318/03)

On 19 January 2006 the European Economic and Social Committee, acting under Rule 29(2) of its Rules of Procedure, decided to draw up an opinion on: The contribution of IT-supported lifelong learning to European competitiveness, industrial change and social capital development.

The Consultative Commission on Industrial Change, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 31 August 2006. The rapporteur was Mr Marian Krzaklewski. The co-rapporteur was Mr András Szücs.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 181 votes to six with eleven abstentions.

1.   Proposals and recommendations

1.1

The European Economic and Social Committee is convinced that the use of electronic media in teaching and training — (e-Learning) (1) should help the European Union to carry out activities aimed at increasing the effectiveness and quality of education, including job-based education and training. This, together with other measures, will reduce staff training costs, substantially improving the competitiveness of businesses, especially small and medium-sized enterprises.

1.2

The Committee believes that learning and training supported by information and communications technologies (ICT) are still inconsistent in the EU. This is caused by linguistic and cultural diversity and the immaturity of the relevant markets.

1.2.1

In order to change this, all educational institutions, including those active in the field of lifelong learning (LL) (2), should be more open to new forms of learning and be ready to use them on an ever wider scale, supporting the integration of knowledge and experience with a view to achieving synergy with the planned technological and economic development.

1.2.2

The Committee believes that the European Commission is best placed to establish a new policy in this context. The issue of communication and coordination is therefore particularly important for the Commission services, especially in the fields of education and the information society.

1.2.3

The time has come to acknowledge that e-learning has moved into the mainstream and the consolidation of professional knowledge in this field. This will ensure the application of consistent approaches and help to realise the added value of e-learning.

1.3

The EESC is convinced of the need for a greater awareness in the EU of ICT, in particular of the way these technologies can support training in industry and lifelong learning, e.g. through:

training provided mainly in the workplace, geared towards solving existing problems in a particular context;

methods and approaches recognising prior learning achievements — including those obtained through work and experience — and encouraging active involvement in learning activities, both independent and collaborative.

1.4

The EESC appeals to the EU institutions and the Member States to remember, when implementing development programmes connected with the establishment of the information society, that these processes must not lead to any form of exclusion. In other words, there should be no social, economic or regional barriers to access to electronic infrastructure as a learning tool.

1.4.1

The Committee stresses that the key condition for using ICT in lifelong learning, particularly in the Community's rural areas and small towns, is support from the EU and the governments of Member States for broadband internet connections (3) that provide access to e-learning systems. The situation is exceptionally difficult for such areas in the new Member States. This adds even more weight to the argument that there can be no place for any kind of barrier as far as access to broadband connections is concerned.

1.4.2

In this context, the EESC appeals to the Commission to recognise access to broadband as part of a wider strategy aimed at ensuring that eAccess is accorded the status of general interest.

1.5

The Committee believes that, as far as e-distance learning and training are concerned, special consideration must be given to the risk of a generation gap emerging, especially since an increasing number of activities in the field of adult lifelong learning will be undertaken using ICT.

1.6

In addition, the EESC would like to draw attention to the fact that e-learning should also be designed in a way that meets the needs of blind people. Given that the technical solutions in this area are well known, the authors of e-learning textbooks should take as a basis the set of rules drawn up by organisations representing the blind community.

1.7

The EESC is convinced that e-learning should be an effective tool for improving the competitiveness of enterprises and increasing their business potential, especially the potential of small and medium-sized enterprises, which have a key role to play in generating economic growth and creating jobs.

1.8

The Committee believes that broadening the scope of ICT-supported lifelong learning in the EU will have a major influence not only on increasing the competitiveness of businesses but also on enhancing the social capital of the people they employ, which should increase the value of European business capital.

1.9

The EESC notes that there is an urgent need to define a new role for civil society and for dialogue among the social partners as regards the promotion and establishment of IT-assisted lifelong learning in the EU's labour markets. Preparing all European societies for ICT-supported lifelong learning will help to build a European Knowledge Area as well as a knowledge-based society (4).

1.10

The Committee notes that less progress than expected has been made in the integration of ICT into learning and the professional consolidation of e-learning. Therefore, the competent authorities at EU and national level are called upon to take measures that will significantly increase the number of people taking up e-learning. Such a development has the potential to make a considerable contribution to the competitiveness and productivity of industry.

1.11

The EESC calls on the EU institutions to pay particular attention to the needs of SMEs, their networks and representative organisations with a view to ensuring they make the most of ICT for training purposes.

1.12

The Committee believes that teachers of modern technology and methodology (IT education) should be given long-term, systematic support through comprehensive programmes and incentives.

1.13

The EESC would like to stress that the European Commission should also pay special attention to the question of intellectual property rights in the field of IT education.

1.14

In the final conclusion of its proposals and recommendations, the Committee suggests following the example of terms already in use in the EU such as e-Europe, e-learning, e-skills etc. by introducing the term — e-LL (e-lifelong learning), thereby stressing the role of this form of learning and the need to develop and extend it within the eEurope action plan and the subsequent i2010 initiative.

2.   Introduction and reason for opinion

2.1

This opinion will examine the contribution of ICT-supported lifelong learning to competitiveness, industrial change and social capital development in the European Union.

2.2

In connection with the implementation of the Lisbon Strategy, lifelong learning is becoming one of the most important concepts in the EU's education policy and new educational programmes for the period 2007-2013 (5). Flexible and open methods of learning and training using ICT will certainly play a key role in the development of the knowledge-based economy.

2.3

Following the groundbreaking eEurope programme and measures to introduce e-learning, which have already led to some promising developments, there must be consideration of how to build on these accomplishments in terms of changes in industry, how to develop opportunities related to these accomplishments and how to sketch out future prospects.

3.   General comments

3.1

The importance of information technology in developing human resources was recognised by the European Parliament and the Council of the European Union (6), which approved a multi-annual programme (2004-2006) for the effective integration of ICT in education systems in Europe. The basic aim of this programme is to use ICT to facilitate high-quality education and training in the context of lifelong learning.

3.2

Open, flexible distance learning, together with e-learning, dominated the last decade, but it is now being looked at once again, this time in a broader context. ICT-supported learning or e-learning make our lives, education and work more flexible and are regarded as one of the main paths to achieving the goals of the Lisbon Strategy. Non-formal (7) and informal learning (8) and also job-based training are becoming more important.

3.3

The EESC opinion of 2004 on Improving the implementation of the Lisbon Strategy  (9) highlighted the need to examine the new opportunities provided by the knowledge-based economy and the importance of the increased expansion of information technologies and innovation processes.

3.3.1

It also drew attention to shortcomings in education systems and to the need for better integration of the social dimension.

3.4

Some of the initiatives taken by the Union in the last decade in the field of ICT-assisted learning produced exceptional results, while others demonstrated a lack of consistency and did not have the intended outcome in terms of numbers and quality.

3.4.1

Early models for e-learning were focused on individuals and the transfer of predetermined knowledge. They included virtually no tutorial support or assessment and were something of a disappointment to those who made early attempts to adapt to this form of learning.

3.4.2

Rapid technological progress, increased economic pressures and the different pace of government policy measures over the past few years, which were supposed to introduce ICT into education and training, have not done enough to promote the development of vocational skills.

3.5

It is planned that in 2010, 12.5 % of adults in the EU aged 25-64 will be involved in various forms of lifelong learning, compared with a current average of 10 % (10). Only by stepping up the expansion of ICT-assisted education and training can these objectives be achieved.

3.5.1

The challenges facing the education and training programmes of the Commission and the Member States are all the greater, given that over the next five years only 15 % of new jobs will be for unskilled workers while 50 % will require highly qualified staff (11).

3.6

A new EU initiative undertaken in connection with the i2010 Commission communication (12) is the e-Inclusion initiative. The term e-Inclusion refers to both the inclusion of ICT and the use of ICT as a means of achieving inclusion (13). The e-Inclusion policy aims to remove barriers to ICT use and to promote ICT usage with a view to preventing exclusion, improving economic productivity and employment opportunities.

3.6.1

An important aspect of e-Inclusion is e-distance learning, which is aimed at reducing or preventing the social marginalisation of occupational groups with limited access to traditional forms of education owing to their geographical location, social situation or special educational needs.

3.6.2

The benefits of distance learning are: not being tied to a fixed place of learning, the possibility of adapting the pace of learning to meet individual learning needs, the opportunity to make use of modern information technologies, the possibility for people from disadvantaged groups to improve their skills, etc.

3.6.3

In its recent opinion (14), the EESC called upon representatives of governments and business sectors to draw up and support measures on the subject of ICT education and training for the various social groups facing e-exclusion (15).

3.6.4

The implementation of the e-Inclusion programme is also linked to the promotion of digital literacy (16), which has become synonymous with the modern knowledge-based society. The recognition in the near future of digital literacy as one of the key skills in lifelong learning in the context, inter alia, of the recent EESC opinion (17), seems not only necessary but indisputable, too.

3.7

The promotion of e-skills  (18) is having an important influence on various aspects of industrial change. The term e-skills covers ICT practitioner, ICT user and e-business skills. Within the framework of the promotion of a wide-ranging e-skills agenda, the Commission recently proposed a series of measures, many of which were concerned with industry and boosting e-skills in the labour market as well as developing and promoting new e-competences (19).

3.7.1

The partnership between stakeholder representatives plays a key role in measures relating to both e-skills and the body of issues linked to the introduction of ICT-supported lifelong learning. Such stakeholders include:

trade unions;

representatives of businesses (as ICT users) who are dependent on a skilled workforce;

representatives of various industries who are responsible for introducing new technologies and are better informed about what type of qualifications are required;

representatives of the ICT industry;

researchers in the field of ICT and developers in this area;

researchers of the quantitative and qualitative aspects of e-skills;

policy makers in the field of education, research, business, innovation and the information society;

forecast specialists with a broad view of changes in society and the interaction between society and technology.

3.8

The expansion of broadband Internet access is of central importance to the achievement of the goals of the i2010 Strategy and those of the e-Inclusion projects. It cannot be limited exclusively to large towns and cities, but should also be available to the inhabitants of less developed regions (20).

3.8.1

It is worth considering that in the EU 15 some 90 % of businesses and households in urban areas have access to a broadband connection, but only 60 % in rural and remote areas; these differences are much greater in the new Member States.

3.8.2

Broadband is vitally important not only for enhancing business competitiveness and for the economic growth of regions, but also for the education and training sector, especially where e- learning is used in training programmes.

3.9

A policy discourse on this matter would currently be highly advisable if we are to improve the practice of lifelong e-learning and thus make this form of training more effective. The EU is best placed to give policy in this area a new direction.

3.9.1

Current policies give de-facto priority to introducing ICT into formal education institutions, notably schools and universities; far less attention is devoted to ICT and far fewer resources are allocated to promoting ICT usage in lifelong learning and non-formal/informal learning among adults.

4.   Specific comments

The contribution of IT-supported lifelong learning to European competitiveness and productivity

4.1

In keeping with the general thrust of the Commission communication of 2002 (21) and the EESC opinion on Training and Productivity, productivity can be said to be the key to making businesses and the European economies more competitive and also to economic growth. Improved productivity is to a large extent dependent on progress in ICT usage by businesses and on the ability of the workforce to adapt to the requirements of modern industry.

4.1.1

Despite the fact that electronic technology, which was the subject of much hype, failed to meet expectations in the initial stages of development, the e-sectors of society and the economy are actually showing unprecedented development and still have great potential.

4.1.2

In this context, the European Commission rightly recognises and values the importance of modern ICT in stimulating competitiveness and innovation and in the knowledge-based economy, especially in small and medium-sized enterprises.

4.2

The path to improving the competitiveness of the European economy has to be vocational education, through programmes and training that make use of ICT. The creation of cohesive, mobile and flexible education and training systems for job seekers, those preparing for work as well as for people employed in industry will increase the growth rate of knowledge and lead to important technological changes and innovations in manufacturing enterprises, which will increase their competitiveness.

4.2.1

In this context, the introduction of IT-supported lifelong learning in businesses and related areas should make them more competitive and help to enhance the social capital of the people they employ, and in so doing increase the value of European business capital.

4.3

Around 1994, there was a breakthrough in the implementation and use of e-learning when the industry — chiefly large corporations — started using this method on a wider scale in their in-company training and human resource development. This was a sign of maturity, when e-learning demonstrated the ability to deliver consolidated and sustainable solutions, overcoming the earlier period of simplistic promotional and marketing messages. In the meantime, SMEs have, for a number of reasons, come to represent a practically disadvantaged group of users of e-learning, where the application of this training method — and frequently, that of ICTs as well — is limited, and most SME employees risk being excluded from opportunities in the field of continuing education. Greater e-learning uptake could be a considerable boost to the competitiveness of SMEs and help to make them more effective. Competent authorities, both at EU and national level, should raise awareness of this and implement measures to promote the use of ICTs for training purposes in the SME sector.

The contribution of IT-assisted lifelong learning to the development of social capital

4.4

Social capital covers skills, information, culture, knowledge and individual creativity as well as relations between people and organisations. The importance of these resources for economic growth and its accompanying industrial changes should be assessed by examining the relationship between the development, promotion and use of such resources and the added value they create.

4.4.1

A high level of social capital has a direct impact on the ability to form a knowledge-based society that is creative, innovative, open to change and capable of forging long-term economic and social ties. One of the cornerstones of such a society is investment in research, education and training.

4.4.2

Social capital may be increased through the ability of the relevant stakeholders (see 3.7.1) to cooperate in the form of a partnership in all programmes and activities relating to ICT-assisted education and training, especially lifelong learning.

The contribution of IT–assisted lifelong learning to industrial change, with particular reference to investment in employee skills, the development of human resources and tackling unemployment.

4.5

E-distance learning and training can enable the systematic, faster and cheaper transfer of knowledge that is of key significance particularly in industry where it forms an important element of its human capital and facilitates the transfer of knowledge from research institutes to industry.

4.5.1

Well-educated workers who continually improve their qualifications are an important factor in determining the value of a particular firm or enterprise. They facilitate changes in production technology, its profile and adaptation to meet the needs of the labour market.

4.6

The European Commission has stressed (22) that, given rapid technological development and changing economic conditions, there is a need for long-term investment in the development of human resources, involving private individuals, businesses, social partners and public authorities. Unfortunately, EU countries show no clear trend towards greater public expenditure on education, which averages around 5 % of GDP, with significant and sometimes even dramatic differences between individual States.

4.7

Investment in the development of human resources has a direct impact on productivity growth and is also an attractive form of investment on both a microeconomic and a social level. Studies (23) show that each year of learning directly increases economic growth by around 5 % in the short term and by around 2.5 % in the long term. This is confirmed in the proposals of the European Council (24), which stressed that investment in education and training brings considerable benefits which far outweigh the associated costs.

4.8

Rapid technological development is leading to the emergence of modern production equipment that often has IT systems that can only be operated by ICT-literate staff. It is not always possible to recruit such staff immediately, but thanks to the large scale use of ICT in teaching and training, particularly in lifelong learning, it will certainly be easier to find such staff in the labour market.

4.9

For the reasons mentioned above, given the current changes in industry, it would be worth taking active steps to introduce ICT into lifelong learning without delay. This action should enable employees of European manufacturing firms and unemployed persons undergoing training to acquire new knowledge and skills more quickly. Unemployed people in particular should be guaranteed access to State-funded ICT training (25).

4.9.1

Unemployed people have little motivation to learn independently as they still have too few opportunities to apply the knowledge they have acquired. The best motivation is the real possibility of a new job resulting from a specific form of training or retraining, ideally provided by the company offering the employment.

4.9.2

This could create favourable conditions for ICT- supported lifelong learning, but in the areas where this would be most appropriate (agricultural areas with bankrupt production businesses, which is becoming common in the new Member States), the infrastructure is inadequate.

4.9.3

Infrastructure in these areas requires government and Union support, since IT companies are unwilling to cover the costs of Internet access for poor areas (small towns and rural areas).

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  e-Learning — The use of new multimedia technologies and the Internet to improve the quality of learning by facilitating access to resources and services as well as remote exchanges and collaboration.

(2)  Lifelong learning (LL) — An expression used to indicate that acquiring new knowledge is now considered a continuous process which does not end when one leaves school or university, but continues uninterrupted throughout one's professional life and even after retirement, spreading to embrace all stages of life and all social groups thanks, to a large extent, to the possibilities offered by e-learning (source: www.elearningeuropa.info).

(3)  Broadband Internet access — Communications channel with high capacity, enabling quick, easy access to information and e-learning systems (source: www.elearningeuropa.info).

(4)  Knowledge-based society — A society whose processes and practices are based on the production, distribution, and use of knowledge for the continued improvement of skills and full involvement in family and professional life and in society, COM(2001) 678 final.

(5)  An integrated action programme in the field of lifelong learning, COM(2004) 474 final, 14.7.2004.

(6)  Decision of the European Parliament and of the Council, No 2318/2003/EC on the eLearning Programme of 5 December 2003.

(7)  Non-formal learning takes place alongside the mainstream systems of education and training and does not typically lead to formalised certificates. Non-formal learning may be provided in the workplace and through the activities of civil society organisations and groups (such as in youth organisations, trades unions and political parties). It can also be provided through organisations or services that have been set up to complement formal systems. EU Commission, SEC(2000) 1832.

(8)  Informal learning — Learning based on everyday situations at work, in the family and during leisure time. It is neither organised nor formal (in terms of set goals, duration or resources). For the learner, non-formal learning often takes place unwittingly and does not usually lead to a certificate.

EU Commission, SEC(2000) 1832.

(9)  Improving the implementation of the Lisbon Strategy.

(10)  Modernising education and training: a vital contribution to prosperity and social cohesion in Europe, COM(2005) 549 final 30.11.2005.

(11)  Conclusions of the Council on education, youth and culture of 21.2.2005.

(12)  COM(2005) 229 final.

(13)  Ministerial Conference ‘ICT for an inclusive society’, Riga, 11.6.2006.

(14)  eAccessibility.

(15)  e-exclusion — exclusion from participation in electronic communication.

(16)  Digital literacy — one of the basic skills required to actively participate in the information society and the new media culture. It focuses on the acquisition of skills and abilities linked to new technologies, increasingly essential in everyday life. E-Learning Programme, 5 December 2003.

(17)  Opinion — Key competences for lifelong learning, May 2006.

(18)  Report — RAND Europe, ‘The Supply and Demand of E-skills in Europe’, IX 2005.

(19)  E-competences — competences in the field of ICT and skills and attitudes relating to ICT usage, which make it possible to carry out professional tasks at the appropriate level.

(20)  Communication of the European Commission: Bridging the Broadband Gap of 21.3.2006.

(21)  COM(2002) 262 final.

(22)  Commission communication: Investing efficiently in education and training: an imperative for Europe COM(2002) 779 of 10 January 2003 (5269/03).

(23)  De la Fuente and Ciccone: Human capital in a global and knowledge-based economy. Final report for the Directorate General for Employment and Social Affairs, European Commission, 2002.

(24)  Conclusions of the Presidency, European Council 23-24 March 2006 (7775/06).

(25)  Opinion: i2010 — A European Information Society for Growth and Employment.


23.12.2006   

EN

Official Journal of the European Union

C 318/26


Opinion of the European Economic and Social Committee on Services and European manufacturing industries: Interactions and impacts on employment, competitiveness and productivity

(2006/C 318/04)

On 19 January 2006 the European Economic and Social Committee, acting under Rule 29(2) of its Rules of Procedure, decided to draw up an opinion on the Services and European manufacturing industries: Interactions and impacts on employment, competitiveness and productivity.

The Consultative Commission on Industrial Change, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 31 August 2006. The rapporteur was Mr Calleja. The co-rapporteur was Mr Rohde.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 183 votes to three with four abstentions.

Conclusions and recommendations

This opinion advocates:

Overall statement

The importance of business services for the growth, competitiveness and employment levels of European manufacturing and service industries needs to be recognised. The use of competitive business services should be promoted through a set of coherent policy actions at European level. The 2005 draft action plan of the EU Business-Related Service Forum (BRSF) provides a good platform for further discussion.

Policy objectives and follow-up

The positive role of business services in the development of public and private manufacturing and service industries should be supported. This may be achieved by a variety of means. At EU level, the following actions are strongly recommended by the EESC:

direct and complementary actions to complete the internal market for business services and especially the removal of obstacles to the smooth operation of the sector (barriers hampering market integration, labour mobility and economic growth);

urgent recognition of business services as an integral part of any industrial policy; the European Commission should note this and take action to widen the scope of European industrial policy by integrating business services;

creation of a European Business Services Observatory to collect information, encourage research, stimulate debate and suggest and monitor implementation of policy recommendations;

reinforcement of social dialogue to follow up and assess changes in labour conditions and job opportunities resulting from the structural changes underpinning the new business service economy.

More generally, other measures need to be taken at market level and encouraged by public administrations, such as:

promotion of business services as a means to improve business and industrial performance and to achieve competitive advantages with low-cost and other competing countries in the global market;

encouragement of more extensive and effective use of business services by SMEs;

boosting of employment and enhancement of working conditions in business services as a means to improve productivity, service quality and living standards;

targeted training and re-training programs to strengthen the adaptability and improve the employability of workers affected by structural change.

R&D, innovation and digital delivery

R&D public-funded programmes, at national and EU level, should give particular attention to actions and projects aimed at boosting the production and use of innovative business services.

Attention should be paid to specific projects in the field of knowledge-intensive services in manufacturing, resulting in innovation and high productivity and growth prospects (e.g. ICT and R&D services).

Business services are a source of innovation in the knowledge economy. Research should be encouraged to further develop ‘service science’, in particular methodological know-how to be applied in business processes.

Intellectual property rights (IPR) and other protection mechanisms should be strengthened through enactment of pending patent legislation to encourage companies to invest more in R&D and innovation.

The role of ICT in service innovation has to be recognised and promoted with objectives such as ensuring delivery of services, particularly in SMEs, via high-speed broad-band internet access across Europe, while endeavouring to solve security and privacy issues relating to digital e-business networks. The European Commission's ‘i2010’ initiative plays an important role in this context.

Service engineering and standards

Service engineering is a new discipline useful as a basis for improving business services output quality through improved systematic planning. This innovative approach deserves to be developed as a speciality for research and education at universities, business schools and other training organisations.

Standards may play a useful role for higher quality services and more integrated EU markets. For that purpose, promotion of voluntary standardisation of services in general and of business services in particular should be encouraged.

Improving knowledge and employment in European business services

Finding solutions to strengthen human capital in the EU and to reverse the growing brain drain from EU research activities.

Introduction of new incentives to the private sector to increase its share of R&D activities in line with the Lisbon Strategy.

Improvement of data and information on business services and on services provided by industrial companies.

Improving transparency of business services' supplier markets.

Provision of more resources for better education, training, e-learning and language skills to enable development of cross-border business services.

Reasons

1.   Introduction

1.1

This Opinion examines the impact of business services on employment, competitiveness and productivity in European manufacturing industries and how this sector can be developed further, in line with the Lisbon programme. Attention is given to developments in the new discipline known as ‘service engineering’ and to the impact of externalisation/outsourcing of business services.

1.2

There is concern about the prospects of the European economy and how it will face up to the emergence of strong competition from low-cost economies. In Europe both manufacturing and services have lost many jobs to other countries with a comparative advantage in terms of costs and skills (e.g. China, in terms of manufacturing, and India, in terms of business services). In spite of these developments manufacturing continues to play a key role in Europe's economy. According to latest available statistics for 2004 the EU leads as the highest exporter of merchandise trade with a figure of over US $ 1 200 bn (1).

1.3

Manufacturing industry is considered to have remained the main source of technological change and innovation in the EU, but it is also noted that it failed to increase its activities in the high technology and higher value-added areas during the previous decade. Business-service related growth, in particular through the use of knowledge-intensive services, is a complementary channel for development of new technologies, new employment opportunities and acquisition of new competitive advantages. Business services provide also sources of non-technological innovation (e.g. organisational), which improve the intangible assets of firms and know-how of workers.

1.4

The remarkable shift in consumption towards services in highly developed economies does not indicate a trend towards de-industrialisation as is sometimes assumed. These developments can be seen as a statistical reflection of a deepening division of labour within developed economies and a disaggregation of previously integrated vertical value chains. Specialised service providers are now offering services that were previously performed in-house by manufacturing enterprises. New service enterprises have evolved and are supporting the effort of European industry to increase efficiency and to absorb new technologies that will spawn new and higher value-added products.

1.5

Recent research shows that the type of economy being developed is one in which services and manufacturing are integrated and complementary in nature. Demand for services exists wherever there is a strong industrial economy and develops as a consequence of this. They do not represent an exclusive alternative (2).

1.6

This Opinion does not advocate a special promotion of services at the price of neglecting manufacturing industries but it stresses the interdependence between manufacturing and the service sector (3). It highlights the positive potential for improvement and expansion of business services. The EESC emphasises the positive contribution of business services to increased productivity and competitiveness of the European manufacturing sector. Simultaneously, the business service sector improves its own productivity through innovation, including the rapid uptake of new technologies, by attracting more highly qualified employees and by improving working conditions (4).

1.7

Externalisation/outsourcing of services to specialised service providers who can exploit economies of scale and continuous process innovation has a positive impact on costs and productivity. Yet the uptake of knowledge and innovative business services by SMEs does not yet seem to be sufficient. Also the ability of employees to move from manufacturing to business services needs to be facilitated through appropriate re-training programs.

1.8

Today, domestic suppliers are providing most of business services. Yet, there is no guarantee that this will be the case in the future. A range of business services can be sourced from abroad at wider European level including new Member States and candidate countries or even globally, according to cost and opportunity (near-shoring and offshore outsourcing). The latest figures show that in 2004 the EU-25 had a positive balance of EUR 42.8 bn in trade in services (an increase of EUR 5.8 bn from 2003) (5).

1.9

There is a need for a permanent and thorough analysis of company structures and processes in order to identify those functions which can be bought from specialised business services' suppliers or networks of companies (shared services) who can handle such functions more efficiently by operating on a larger scale and by pooling their expertise. Though this might have an impact on employment in manufacturing, it may sometimes help to offset the potential negative effects of offshore outsourcing, maintain manufacturing industries in Europe and increase the demand of employment in business services. The reinforcement of qualified service jobs in businesses provides new competitive advantages.

2.   Challenges for European industry: a challenge for business services

2.1

All sectors of the European economy feel the effects of globalisation and the need for change in order to adapt to new circumstances. Industrial policy can play a positive role in this context. In its Communication Fostering structural Change: an Industrial policy for an enlarged Europe  (6), the European Commission stated that it intends to develop an appropriate industrial policy to accompany industrial change:

European industry has to cope with a process of structural change which is beneficial overall and which should be encouraged by policies that facilitate the development and use of knowledge;

economic internationalisation offers opportunities to European industry as long as industrial policy supports the necessary evolutions and active labour market and social policies prevent a negative impact on workers;

EU enlargement offered not only the extension of the internal market but the possibility of re-organising value chains across the continent to make the most of competitive advantages of the new Member States;

the transition to a knowledge economy will be vital and a certain regulatory prudence will be necessary to avoid putting a strain on the industrial competitiveness of the new Member States.

The EESC advocates more rapid progress in concrete achievements of the EU Industrial Policy and the inclusion of business services within its framework.

2.2

More recently, the European Commission published a Communication on Implementing the Community Lisbon Programme: A policy framework to strengthen EU manufacturingtowards a more integrated approach for industrial policy  (7). Under this framework for industrial policy the Commission identified seven major cross-sectoral policy initiatives:

an intellectual property rights (IPR) and counterfeiting initiative;

a high level group on competitiveness, energy and the environment;

external aspects of competitiveness and market access;

new legislative simplification programme;

improving sectoral skills by identifying relative skill requirements and gaps;

managing structural change in manufacturing;

an integrated European approach to industrial research and innovation.

The neglect of services in general and of business services in particular is a serious shortcoming of this Communication. The EESC calls for business services to form an integral part of any industrial policy and urges the European Commission to widen the scope of future industrial policy approaches by integrating business services. An effective industrial policy will also have to take into account the social and employment implications of industrial change. This means more emphasis on lifelong learning and support to facilitate mobility of employees.

2.3

Europe needs to embrace more widely and deeply Information and Communication Technologies (ICT). Intensification of ICT and its integration in industry is as important as it is in business services. In terms of IT take-up, Europe lags behind its key competitors. The IT expenditure in 2004 per capita was EUR 732 for Western Europe, EUR 1 161 for the USA and EUR 1 012 for Japan. The IT spending in terms of percentage of domestic GDP was 3.08 % for Western Europe, 4.55 % for the USA and 3.59 % for Japan (8). The European Commission's task-force on ICT competitiveness plays an important role in this context.

2.4

The productivity gap of European manufacturers is often attributed to the lack of technology take-up and insufficient exploitation of the potential of ICT, in particular by SMEs. The problem does not seem to be caused by the costs of hardware. The problem is the lack of ICT knowledge and expertise in SMEs, which makes it difficult for them to cope with the rapid changes in, and the increased complexity of, ICT. A ‘digital divide’ that separates small from medium-sized companies exists with the consequence that the full potential of ICT and e-business models has not yet been realised (9). The role of business services is important to make the ICT sector efficient and thus procure sustainable productivity gains.

2.5

The internal market for services in general, and for business services in particular, is not complete and many obstacles do exist hampering efficiency, competitiveness and creation of new employment opportunities. A large number of barriers were recognised in the Report on ‘The state of the internal market for services’ (10), but some progress has been made by implementing the Lisbon Strategy. On top of the regulatory aspects of the business services markets, complementary policies such as those indicated in this document are needed to ensure the necessary EU competitiveness in the global market as well as social and economic progress.

3.   The importance of business services and their interaction with industry

3.1   Definition of business services

Business services are traditionally defined as a sub-group (NACE 70-74) within the business-related services (i.e. business services plus transport services, communications, distributive trade and financial services) (11). The criterion for the definition of both concepts is the clientele to which the services are directed. They are not services mainly addressed to final consumers, but rather to enterprises. They are real activities that influence first the competitiveness of companies (they are not incompatible with the service provision to consumers) through their use as intermediary inputs in the value chain and also through the quality and innovation gains resulting from the interaction between supplier and client and service. Business services have the particular characteristics that most of them can be performed in-house or be contracted out (outsourced) to an external specialised firm.

3.2

Business services is a group of very heterogeneous activities ranging from professional services (e.g. engineering, accountancy, legal services) to high-value-added services (e.g. ICT services, management consultancy), personnel services (e.g. selection of personnel, outplacement, temporary work) and business support services, including those with low added value (e.g. cleaning, security, catering) and those with rising added value (such as energy management, supply and treatment of water and other fluids, and air and waste processing). In these groups of activities, labour and social conditions deserve particular attention.

Table 1.   Major services required for the performance of enterprises (functional approach) (12)

FUNCTIONS IN ENTERPRISES

MAIN BUSINESS-RELATED SERVICES

 

FUNCTIONS IN ENTERPRISES

MAIN BUSINESS-RELATED SERVICES

Administration

Management consultancy

Legal services

Auditing and accounting

 

Information Management

Computer and IT services

Telecommunications

Human Resources

Temporary work

Recruitment of personnel

Professional training

 

Marketing and sales

Advertising

Distributive trades

Public relations

Fairs and exhibitions

After-sales services

Financial Intermediation

Banking

Insurance

Renting and leasing

 

Transport and logistics

Logistics

Transport services

Express courier

Production and technical function

Engineering and technical Services

Tests and quality control

R&D services

Industrial design

Maintenance and repair of equipment

 

Facility management

Security services

Cleaning services

Catering

Environmental services/

waste disposal

Energy and water services

Real Estate (warehouses)

3.3   The place of business services in the economy

Business services are an important element of the European market economy. However, the most important feature of business services is that they are present in, and integrated into, every stage of the value chain. Growth of business services is usually explained by the migration of employment from manufacturing industry to services due to the outsourcing of the services functions. But the reasons for growth are multiple. Changes in production systems, more flexibility, stronger competition on international markets, the increasing role of ICT and knowledge and the emergence of new types of services are other important factors. ‘According to Structural Business Statistics, the business-related services sector (excluding the financial services) constitute[d] 53 % of total employment in the EU market economy in 2001, while manufacturing ha[d] a share of 29 % (or around 29 million persons employed) […]. Total value added by business-related services constitute[d] 54 % in 2001 compared to 34 % for manufacturing’ (13).

3.4

Today more and more manufacturing companies venture into services themselves. Not only do they offer after-sales services, but to an increasing extent discover the value added through selling their expertise in engineering, design or process innovation to other companies as part of their business. A new hybrid company model is emerging that includes enterprises with manufacturing/service activities. Customers are increasingly looking for ‘solutions’ rather than simply products, and it is often the ability to provide additional services that gives a manufacturing company its competitive advantage.

3.5

Lack of specific statistical data on business services  (14). There is a lack of statistical information on the demand for services. The interrelationship between the various sectors is not sufficiently documented. Information on service activities and their contribution to the EU Member States' economies should hopefully be improved through a revision of the NACE classification system, which is expected in 2007. The revised classification will provide better insight into the structure and development of the services sector (15). Information on the extent to which industrial companies provide services is also lacking.

3.6

Fragmentation and scarcity of information and analysis related to business services. The EESC finds that there is a need for a European Business Services Observatory to collect information, encourage research, stimulate debate and suggest and monitor implementation of policy recommendations. An observatory or similar action would lead to a better understanding of the new high-speed developments of the sector and serve as a meeting point between policy-makers and stakeholders.

3.7

Standardisation of services. The further acceleration in voluntary standardisation of services based on market needs and sound evidence includes raising base-line safety, quality and performance and promoting competition and innovation in service delivery. This challenge has to be taken up by CEN, ISO and national standardisation bodies. The development of voluntary standards in the service sector would certainly stimulate the trade in services across borders and help to foster the internal market for services.

4.   How business services improve industrial competitiveness (16)

4.1

Business services are of major importance in helping the SME sector realise its potential contribution to innovation and growth. There is evidence that the most dynamic SMEs make extensive use of business services. In the face of the pressures of internationalisation, greater use of these services by a wider range of SMEs needs to be promoted.

4.2

National innovation capacity.

The ability of a nation to produce new ideas and to commercialise a flow of innovative technologies over the long term are influenced by a range of factors (17):

overall innovation infrastructure;

essential framework conditions/flanking policies;

interconnection of the overall innovation system;

general systems of education.

4.3

85 % of EU research concentrates on manufacturing (US 66 %) and no reliable figures exist for a breakdown of service sector R&D activities. Out of total manufacturing R&D, 87.5 % is conducted in eight specific areas (chemicals, mechanical engineering, office machinery, electrical machinery, semi/conductor-communications, instruments, motor vehicles and air- and spacecraft).

4.4

In terms of absolute expenditure the EU has failed to close the gap with the US on R&D; indeed, this gap has increased over the last decade.

4.5

More focus on R&D funding into high-tech and knowledge-intensive (high margin) services is of paramount importance for the competitiveness of European industry. The ‘3 % objective’ (18) would be easier to achieve if governments increased their financial commitments and if the private sector was encouraged and assisted to invest more in this regard including business services.

4.6

A European Institute of Technology as proposed by the European Commission in a recent Commission Communication (19) is useful, yet technology needs to be accompanied by effective business and organisational strategies.

4.7

The impact of innovative functions of business services is tabulated below:

Table 2.   Innovative functions of business services (20)

Innovative functions

Principal elements of innovation

Business services (some representative sectors)

Technological Innovation

Greater integration of technology

Use of existing technology

Adaptation of technology to business needs

Efficiency in the advanced processes of information and communication

Automation of routine processes

Flexibilisation of productive structures

Quality improvement

IT services

Engineering services

Design services

Telecommunications Services

On-line services of electronic communication

Quality control services

Organisational innovation

Efficiency of internal organisation

Articulation of control and coordination processes

Improvement of human factor selection, training and utilisation

Improvements in the different functional specialisations

Management consulting and management

Audits and legal services

Manpower services (selection, training and temporary employment).

Strategic innovation

Flexibility for dynamic environments

Positioning in complex markets

Strategic information regarding alliances

Information regarding product adaptation

Information regarding location and markets

Defence in a conflicting legal environment

Management services

On-line services

Audit services

Legal services

Fairs and exhibitions services

Marketing services

Commercial innovation

Product competitive design

Innovative commercialisation

Taking advantage of opportunities

Search and relations with the client

Innovative Marketing

Image concern

Design services

Fairs and Exhibitions

Publicity

Direct Marketing

Public relations

After-sales services

Operational innovation

Functional division of labour

Concentration on key tasks

Operational capacity concern

Image concern

Linguistic services

Courier services

Security services

Operational services

Source: Rubalcaba (1999) Business services in European Industry; European Commission, Brussels.

4.8

Some of Europe's most innovative companies are to be found in business services, but the overall level of R&D in the service sector is too low and unstructured. New services and business models often emerge from costly and time-consuming attempts and failures by individual enterprises. It is necessary for the EU to support research in selected areas in order to update the know-how of companies in leading global cutting-edge technologies.

4.9

It is important to find ways to improve the access of SMEs to research results and underpin them in their short-term product development.

4.10

If companies are to invest more in innovation and R&D, appropriate protection of intellectual property rights has to be secured by the European Commission and action has to be taken to implement the pending proposal on the patenting of computer-implemented inventions.

4.11

Better legislation and regulation is necessary.

5.   The EU knowledge creation system

5.1

A radical overhaul of the EU knowledge creation system is needed. This includes:

re-orienting R&D activities to high-technology ICT-producing enterprises;

stopping the brain drain from the EU to the US (twice as many EU researchers move to work in the US compared with the opposite inward flows; 40 % of US R&D is carried out by EU-trained scientists);

increasing total expenditure on research to achieve the Lisbon target of 3 % of GDP;

ICT-user skills, digital literacy and e-business skills have to be regarded as key competencies; curricula must integrate ICT skills at an early age;

advanced fixed and mobile broadband will be the infrastructure of the knowledge-based economy in this century. The i2010 initiative launched by DG Information Society in 2005 plays an important role in this context.

6.   The role of ‘service engineering’

6.1

Service innovation has been the subject of intense discussion and research mainly in Germany since the mid-90s. Service engineering generated much of the momentum for both academic and practical work in this field. This has developed into a technical discipline concerned with the systematic development and design of service products using suitable models, methods and tools. Although service engineering also embraces aspects of service operations management, the development of new service products is a key focus. At the same time service engineering is also concerned with the design of development systems, in other words with service-related questions of general R&D and innovation management.

6.2

Fundamental research into new business models, methods and tools will give service engineering a valuable boost. Integrated approaches for co-engineering physical goods, software and services will become an established feature. Finally, the growing harmonisation of service standards will encourage the specification and efficient development of new services (21).

6.3

Service engineering is one of the few fields in the service sector that has been substantially shaped by European research. Closer integration in international networks and the systematic development of an independent service engineering community are essential in order to sustain a leadership role in this field in the future (22).

7.   The importance of digital delivery of services

7.1

A shift to intensification of online delivery. There is increasing attention to the growth and impact of ICT-enabled international sourcing of information technology services and business-process services. There is a re-orientation of business services by the application of ICT and a shift to more intensive online delivery. The emphasis is on digital delivery in areas such as software services, R&D and technical testing services, consulting services and HRD and labour-supply services. This is mainly market-driven because of:

new customer demands and expectations;

the push to enhance market reach and expand markets;

quality improvements and depth of customer relations;

gains in operating efficiency and economies of scale;

cost reductions by improving and expanding low-cost production and delivery options.

7.2

Exploring the potential benefits of offshoring for the EU economy. New global challenges are building up in the ongoing provision of outsourced services from any point of the world. Europe should therefore be ready to provide and export high-quality services to the rest of the world. Digital delivery and related e-business support is bound to increase. International offshoring of business-related services is today focussing on back-office functions (e.g. IT services, financial and accounting services, call-centre functions). In the higher value-added services such as IT engineering, research and analysis, the EU is still holding its own. However, technological development, availability of skills and related costs in the global market are bound to affect decisions by European companies to a larger extent in the future. This is a challenge for the European labour market to provide more high skilled employment opportunities and avoid unemployment (23).

7.3

Impediments to general digital delivery of services. There are impediments to the development of digital delivery that should be thoroughly investigated and solutions found so that European business service firms can be more aggressive and expand more outside EU borders. Such impediments include the lack of standards and interoperability, trust and security in e-commerce, the lack of investment in fixed and mobile broadband infrastructure and the still too low uptake of ICT by SMEs.

8.   The employment potential in business services

8.1

Employment in business services has grown impressively over the past few decades. Annual growth rates between 1979 and 2002 stood at around 4.5 % annually, which was far above the rates of any other economic sector. The share of business services employment in total employment stood at 9 % in 2003 in EU-15 and at 8.6 % in EU-25. The services sector in general and business services in particular will play a key role in providing new employment in the future and compensate for decreasing employment in manufacturing industries.

8.2

Table 3 below shows how employment in business services increased up to 2002 as compared to the total economy.

Table 3.   Annual growth rates in business services employment, 1979-2002 (24)

Country

Total economy

Business services

Real Estate

Renting

Professional services

Contract R&D

IC services

Operational services

LU

2,6

7,6

5,2

4,4

7,5

6,5

12,4

7,4

PT

0,4

6,9

6,5

5,5

6,7

7,7

8,1

7,0

IE

2,0

6,4

5,3

4,6

6,0

0,8

10,5

6,5

IT

0,5

6,4

4,4

8,0

6,1

4,1

6,5

6,7

DE

0,6

5,3

4,2

3,4

4,5

2,9

6,5

5,8

FI

0,1

5,4

1,0

1,6

4,3

3,3

8,5

6,0

ES

1,1

5,4

3,7

6,0

4,9

3,2

7,4

5,8

NL

1,6

4,7

3,7

5,3

4,1

3,4

8,1

4,7

AT

0,3

4,8

1,4

2,6

4,3

4,0

9,6

4,8

SE

0,2

4,7

1,2

2,7

4,3

4,2

6,1

4,7

EL

0,8

4,6

5,9

3,4

4,2

4,0

8,1

4,8

UK

0,4

3,3

4,8

2,2

2,8

-0,4

6,9

3,5

FR

0,5

3,2

1,3

4,1

2,5

1,7

4,7

3,8

DK

0,3

3,1

1,5

2,8

1,8

-0,8

5,8

4,3

BE

0,3

3,6

3,9

0,9

3,2

-1,7

5,0

4,0

EU15

0,6

4,4

3,3

3,3

3,9

1,7

6,4

4,7

US

1,4

4,7

1,6

3,5

3,5

2,9

8,8

5,3

8.3

Dynamic employment growth in services and in knowledge-intense business services in particular is a characteristic attribute of modern economies. Although the levels of employment in business services as well as the growth rates vary from country to country in Europe, it can be stated that ‘there is no poor country with many business services and no rich country where business-service jobs are scarce’ (25).

8.4

It can be expected that the growth of employment in services and in particular in knowledge-intensive business services will continue though at slightly more moderate rates. Nevertheless, according to the table 4, these will be higher than those projected in other economic activities. Growth rates are expected to be essentially higher in the new Member States where development of services starts from substantially lower absolute levels.

Table 4.   Employment trends across Western European sectors

Image

Note: Western Europe is defined as EU15 + Norway + Switzerland.

Source: Cambridge Econometrics Press Release, What has happened to the Lisbon agenda? November 2005.

8.5

A special feature of employment in business services is the high levels of education attainment. As the EU labour force survey shows, in 2003 the employment share of ‘high-skilled’ jobs was at 41 %, up from 38 % in 1998. The level of low skilled was at 17 % down from 25 % in 1998. The fact that most of the jobs in business services require high- and medium-level skills also poses a challenge to the educational systems in Europe (and in particular the lifelong learning policies) as the structural change of European industries will require more people to move into business services from other employment areas. Rigorous application of the Lisbon education 2010 agenda will be of paramount importance against this background. Table 5 shows the education attainment levels across several sectors.

Table 5.   Education attainment levels by major economic activity and business services, EU15, 2003 (26)

Image

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  WTO Trade Statistics, 2004.

(2)  Business Services in European Industry, Luis Rubalcaba-Bermejo — EU Commission, 1999.

(3)  Summary of final report: ‘The significance of competitive manufacturing industries for the development of the services sectors’, Kalmbach et al., University of Bremen, December 2003.

(4)  See the EESC Opinion on ‘European business competitiveness’, that highlights the importance of guaranteeing appropriate social conditions while seeking to increase productivity and competitiveness. See, in particular, §§ 2.5 to 2.5.3; in § 2.5.2, for instance, the EESC states that it is ‘urgent for Europe to be made more competitive under conditions ensuring its economic and social development, its cohesion, its jobs and its environment’.

(5)  Eurostat News Release 17/2006, 13.2.2006.

(6)  COM(2004) 274 final. EESC Opinion adopted on 15.12.2004 (rapporteur: Mr van Iersel, corapporteur: Mr Legelius), OJ C 157, 28.6.2005, p. 75 onwards.

(7)  COM(2005) 474 final. EESC Opinion adopted on 20.4.2006 (rapporteur: Mr Ehnmark), OJ C 185, 8.8.2006, p. 80 onwards. See also the CCMI Complementary Opinion (rapporteur: Mr Pezzini).

(8)  EITO 2005, p. 263.

(9)  E-Business Report, 2005.

(10)  COM(2002) 441 final, 30 July 2002.

(11)  See the European Commission Communication entitled ‘The competitiveness of business-related services and their contribution to the performance of European enterprises’ (COM(2003) 747 final, 4 December 2003), which may be accessed at

http://europa.eu.int/eur-lex/en/com/cnc/2003/com2003_0747en01.pdf (see, in particular, § I.2 and box 1).

(12)  Source: The competitiveness of business-related services and their contribution to the performance of European enterprises (COM(2003) 747 final), Annex I (‘Classifications of services and additional figures’), which may be accessed at

http://europa.eu.int/eur-lex/en/com/cnc/2003/com2003_0747en01.pdf.

(13)  COM(2003) 747 final, § II.2, p. 11.

(14)  See ‘A sectoral survey of relocation: a factual background’ (in particular pages 107 and 177-179), commissioned by the CCMI and used as a basis for its Information Report entitled ‘A sectoral survey of relocation’ (rapporteur: Mr van Iersel, co-rapporteur: Mr Calvet Chambon).

(15)  Report of the EU Business-Related Service Forum, June 2005.

(16)  See COM(1998) 534 final and COM(2003) 747 final.

(17)  Stern, Furman, Porter, 2002.

(18)  See the EESC Opinion on FP7: In keeping with the Lisbon strategy, ‘the spring 2002 European Council in Barcelona [defined] quantitative objectives for the support of research activities, with total research expenditure in the EU set to rise to 3 % of GDP by 2010, with two-thirds of funding coming from the private sector (the 3 % objective). The Committee would point out, however, that, in the light of the global investment race, this objective is a “moving target”. Those who fail to reach it in time fall even further behind’ (§ 2.5).

(19)  COM(2006) 77 final.

(20)  Extracted from the publication entitled The Contribution of Business Services to European Employment, Innovation and Productivity, by Luis Rubalcaba and Henk Kox, forthcoming by Palgrave-Macmillan.

(21)  Service engineeringmethodical development of new service products, by Hans-Jorg Bullinger, Klaus-Peter Fahnrich, Thomas Meiren.

(22)  Thomas Meiren, Fraunhofer Institute for Industrial Engineering, Stuttgart, Germany.

(23)  European Forum on Business Related Services, 2005 Report.

(24)  ‘The Contribution of Business Services to European Employment, Innovation and Productivity’ by Luis Rubalcaba and Henk Kox (to be published in 2006 by Palgrave-Macmillan).

(25)  Rubalcaba, Kox, 2006, p. 42.

(26)  Source: Rubalcaba and Kox (2006), based on Eurostat data, Labour force Survey, 2004.


23.12.2006   

EN

Official Journal of the European Union

C 318/38


Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council establishing the European Globalisation adjustment Fund

COM(2006) 91 final — 2006/0033 (COD)

(2006/C 318/05)

On 27 March 2006 the Council decided to consult the European Economic and Social Committee, under Article 159 § 3 of the Treaty establishing the European Community, on the abovementioned proposal.

The Consultative Commission on Industrial Change, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 31 August 2006. The rapporteur was Mr van Iersel and the co-rapporteur was Mr Gibellieri.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 170 votes to ten with fifteen abstentions.

1.   Executive summary

1.1

The EESC welcomes the proposal from the European Commission concerning the setting up of a European Globalisation Fund (hereafter EGF). The EESC agrees with the objective of intervening via the EGF in cases where immediate and extensive social problems for workers arise as a consequence of serious and unforeseeable economic disruptions.

1.2

The EESC agrees that the Member States themselves have primary responsibility and that the EGF should intervene only at the request of a Member State and after a corresponding decision of the budgetary authority. The rules have to be clear.

1.3

During times of severe disruption, anticipatory policy, dynamic entrepreneurship, regional responsibility and timely measures and cooperation by the relevant stakeholders — business, the social partners, government, regional authorities and others — are key. The EGF as an instrument of EU solidarity has a complementary function. To be credible the expectations must not be raised too high.

1.4

The specific actions, financed by the EGF, must fit into the overall planning of all stakeholders concerned. The EGF should not intervene in areas where the Member States have exclusive competence. It should be made clear that the Fund is targeting specific employment opportunities for people in urgent economic circumstances.

1.5

The EESC calls on the Commission to ensure active involvement of the social partners in processes aimed at creating employment for workers made redundant. Achieving the objective of ‘quick reintegration’ of redundant employees into the labour market is usually a tough job. Evidence shows that such processes take a lot of time.

1.6

Strict coordination between the various existing instruments, particularly between the EGF and the Structural Funds, should be guaranteed in order to increase effectiveness and coherence.

2.   The Commission's proposal

2.1

In March 2006 the Commission submitted a proposal for a European Globalisation adjustment Fund (1). It is aimed at providing specific, one-off support to facilitate the re-integration into employment of workers in areas or sectors suffering the shock of serious economic disruption.

2.2

Serious economic disruption can imply economic delocalisation to third countries, a massive increase of imports or a progressive decline of the EU market share in a given sector. The major criterion for the EGF is more than 1 000 redundancies in a company or in a group of companies in regions with a higher than average rate of unemployment.

2.3

Eligible actions under the EGF should create conditions for a quick re-integration of people who have lost their jobs into the labour market. The assistance is supplementary to national provisions and targeted regional programmes. Measures to be included are: retraining, relocation assistance, assistance for business start-ups and supplementary income benefits.

2.4

The EGF will intervene only at the request of a Member State. The amount paid by the EU may not exceed 50 % of the total estimated cost of the complete set of measures envisaged by the Member State.

2.5

There is no specific financial provision for the Fund in the Financial Perspectives. It will be financed through under-spends and decommitted funds. Each deployment will be decided by the budgetary authority, which means that full responsibility lies with the Council and the EP.

2.6

A detailed budget procedure is foreseen. The Member States shall take responsibility for the management of actions supported by the EGF. The Commission shall have a supervisory role. In cases where the amount is under-spent reimbursement shall take place.

2.7

The Commission shall carry out an ongoing evaluation on the results, criteria and effectiveness of the regulation as well as an ex-post evaluation. From 2008 on, the Commission will present an annual report on the implementation of the Fund, including evaluations.

3.   Background to the EGF

3.1

The proposal, aimed at demonstrating the EU's solidarity with workers made redundant as a result of sudden changes in world trade patterns, is based on the conclusions of the European Council of December 2005. As a compromise, it is part of the deal on the Financial Perspectives. An impact assessment has been carried out (2) containing relevant information about the content and scope of the EGF.

3.2

The EGF is separate from the Structural Funds and will serve as one of the EU instruments needed to further the adaptation and competitiveness of the European economy (3).

3.3

The Structural Funds aim at long-term anticipative actions based on a multiannual approach, whereas the EGF is not envisaged for restructuring purposes. It aims specifically to address individuals in regions affected by serious shocks in world trade patterns. Such infrequent but critical situations may require one-off, time-limited individualised support. Some objectives of the EGF are not covered by the Structural Funds.

3.4

To a certain extent the US Trade Adjustment Assistance (TAA) programme of 1962 has served as an example. The TAA aims to correct the asymmetry between the adverse effects of trade opening and international liberalisation for specific individual cases or regions and their overall benefits. A comparison between the TAA and the EGF, though, is not easy because of the difference in culture between the US and the EU and the different criteria involved.

3.5

The EGF should function in accordance with the best practice identified by OECD, which specifies the need for a clear identification of groups of trade-displaced workers and the provision of assistance for limited periods of time in line with the principles of cost-effectiveness, transparency and accountability.

3.6

The EGF aims to contribute to the development of a ‘flexicurity’ approach in the Union, a balance between flexibility and employment security and will complement the multi-annual strategic priorities and policies of the Structural Funds.

4.   General comments

4.1

The Regulation initially refers to the overall positive effect of globalisation on growth and jobs in the EU. But the EESC notes that, at the same time, visible and adverse effects at sectoral and regional level are quite possible. The EGF will be a specific instrument in view to enhancing reemployment opportunities towards workers affected by serious economic disruption. It is a pity that the impact assessment (4) has not carried out an analysis of concrete cases.

4.2

Given that the fourth recital of the Regulation requires that activities of the EGF be ‘coherent and compatible with the other Community policies and comply with its acquis’, the proposals should be closely examined by a range of Commission policymakers, in particular DG Competition, in order to avoid any unjustified allocation of state subsidies.

4.3

The EGF represents a concrete step by the European Union towards tackling the consequences of serious shocks in external trade and the global market. For the future, a similar instrument might be considered to mitigate the negative consequences of the internal trade and EU single market (e.g. delocalisation within the EU, taxation policy).

4.4   Intervention criteria

4.4.1

Strict intervention criteria are required. However, the criterion mentioned in Article 1: ‘support for workers made redundant because of changes in world trade patterns leading to a significant adverse impact on the regional or local economy’, is rather vague. The Member States have primary responsibility for submitting applications for Fund contributions. The Commission should guarantee an equal application of the criteria in all cases and to all Member States.

4.4.2

The burden of proof regarding applications lies with the Member States. Application will be examined and close monitored by the Commission, involving the use of guidelines and financial support will be allocated by the budgetary authority on a case-by-case basis. This will involve a process of learning by doing and by practical experience, for the Commission, for the Member States and for the budgetary authority alike. Ambiguities must be avoided: the same rules and approach must be valid and applied across the Union.

4.4.3

As regards the minimum level of redundancies in specific regions, the intervention criteria laid down in Article 2 are clearly defined. The criterion ‘1 000 employees’ is not limited to one company, but it includes downstream and upstream producers.

4.4.4

Usually the rationale for reducing the number of employees will be based on a range of factors, such as modernisation, rationalisation, change of production methods, and, indeed, international trade patterns. Rarely will one specific factor prevail totally.

4.4.5

The American TAA has been taken as an example. But, again, in the Commission's description of the functioning of the TAA the link between changing trade patterns and governmental actions aimed at softening their effect on redundancies is rather vague. Moreover, the criteria and the history of application of the TAA are quite different from what is envisaged in the EU.

4.4.6

GF funding will be sought in the event of economic shocks and unforeseeable circumstances. However trends of change are usually already visible before the real impact of this change is felt. Good business management involves taking pre-emptive actions in good time.

4.4.7

This means that any planned national and EU support measures will have to take into consideration the way in which companies and the social partners themselves have anticipated change. For instance, how relevant are support measures, if business and social partners have neglected to identify in good time developments which might threaten markets and/or employment?

4.5   The definition of eligible actions

4.5.1

The difference between the Structural Funds and the EGF is threefold: a) difference in scale: EUR 44 billion versus EUR 500 million per year, for the future programming period 2007-2013; b) difference in approach: long-term and anticipative on broad issues of modernisation versus short-term and targeted on a quick re-integration of workers in the labour market; and c) because of their volume and scope the Structural Funds tend to be bureaucratic, whereas for the EGF a non-bureaucratic approach is aimed at.

4.5.2

A strict distinction between the Structural Funds and the EGF must be ensured. The EGF is by definition short-term and time-limited and is focussed on specific cases. In the longer run additional commitments of Structural Funds can be foreseen in the framework of a broader regional context. In cases where actions are complementary the different philosophy and structure of each Funds must be respected.

4.5.3

It will not be easy to create conditions for a ‘quick’ reintegration of redundant employees into the labour market, if the context and circumstances are not favourable, such as in the case of regions primarily dominated by one industrial activity, backward regions, or where there is a lack of education and retraining facilities on the ground, etc. Special attention should be addressed to middle and senior management in order to avoid any brain drains. In these particular cases a combination of EGF and Structural Funds is probably needed, as well as the best possible use of the EURES network to promote opportunities for mobility across Europe. A lack of effective coordination might pose problems. In this respect the provision of Art. 5(3) requires special attention.

4.5.4

The eligible actions set out in Art. 3 must be taken together with the provisions of Arts. 5 and 6, in particular regarding the interrelationship and interaction between regional, national and EU actions. As EU actions are complementary to regional and national measures, experience gained in the past in the EU — like those in RESIDER, RECHAR and RETEX — and in other situations could be helpful, taking into account that the EGF has not been entrusted with any restructuring role.

4.5.5

In specific cases it may be useful to employ the sectoral approach used in modern industrial policy, in examining analyses and in determining the use of instruments.

4.5.6

It is of particular importance and concern to a number of Member States that income-related and labour market policies remain a national responsibility and that the Commission is prevented from interfering in national competences. Consequently, within the complete set of measures drawn up by a Member State to address a particular crisis, the EU contribution must focus explicitly on individuals and on fostering the re-entry of redundant employees into the labour market. At this point, the EESC refers to the application criteria of the former social chapter of the Coal and Steel Community which may help to avoid institutional overlap and conflicts.

4.6

The budgetary authority has a crucial role to play. We welcome the fact that the Regulation duly prescribes in detail the financial procedures to be followed.

4.7

The Regulation is drafted for specific emergency cases, which as a rule require fast and effective action. This means that in applying the rules bureaucracy must, of course, be minimised, whereas at the same time due caution is required. The objective should remain the provision of effective support in the shortest possible time frame.

4.8

In the (recent) past, in a number of cases, successful restructuring has been carried out, even in complicated cases. Although concrete cases are always unique, the broad spectrum of restructuring shows that concentrated regional efforts of all stakeholders, often supported by their governments, with a clear focus on creating conditions for new or reinforced industrial and service-related business and redeployment, have fostered success.

4.9

In most cases economic and social plans have been made in close cooperation between the national government, regional authorities and the social partners, who have generally organised round tables and involved all stakeholders in the region.

4.10

Regarding the new EGF, similar procedures need to be foreseen and implemented in order for the Fund to be a success. To that end, representatives of the Commission shall have to participate directly in such gatherings and meetings at regional and local level.

5.   Specific comments

5.1

Although the budgetary allocation of EUR 500 million for the EGF has been established by the Commission through statistical simulations based on concrete cases, its amount should be assessed and possibly adjusted annually on the basis of the evolving situation and of the real feedback of the fund application.

5.2

Article 2 specifies serious economic disruption as the trigger for EGF intervention. The EESC calls on the Council to discuss the definitions of the phenomena mentioned in the introductory paragraph of this Article, before the Regulation comes into force. Overly broad definitions may hamper effective decision-making later on by the budgetary authority. Too narrow definitions may have the same effect. A Council discussion may help to clarify the dilemma and strike a balance. Such discussion may also be a useful input for the Commission's guidelines.

5.3

The reasons for such intervention must be clearly stated. Anticipative actions by business itself as well as by the social partners and other stakeholders should be taken into consideration. This could also be included in the Commission's guidelines.

5.4

As part of the annual evaluation, and also with a view to possible modification in accordance with Article 20, an assessment of the intervention criteria as laid down in Article 2 (number of workers involved, territorial dimension and employment indicators) should be considered in order to ensure that the intervention criteria are also flexible enough to cope with the diversity of specific regions, in particular regarding small countries with primarily small and medium-sized companies.

5.5

Article 3 sets out in (a) and (b) the actions eligible for EGF financial intervention. The EESC notes that income-related areas such as retirement rights and social benefits are an exclusive competence of the Member States. The EGF should be restricted to financing various kinds of education and training facilities and framework conditions. In specific circumstances this may include wage-support for individuals, who have a job or are job-seeking.

5.6

Article 10(1), fixes the maximum contribution by the EGF at 50 % of the total set of measures envisaged by the Member State. The EESC does not wish to query the level of this percentage. It points, however, to the fact that a relation exists between the level of financial contribution by the EGF and the number and the dimension of the cases that will be dealt with.

5.7

With regard to Article 12 the EESC proposes that paragraph 1(b) read as follows: ‘evidence that the criteria laid down in Article 2 and the requirements of Article 6’ are met.

5.8

The EESC considers that the social partners and other stakeholders in the regions have to be involved at every stage of the EGF procedure. The EESC and the Committee of the Regions should also be informed by the Commission.

5.9

From 2008 on the Commission will present annual reports on the EGF. Such ex-post evaluation may be subject to debate by the Council. Article 20 provides for a formal review of the Regulation by December 2013. The EESC recommends that the Commission also include an assessment of the EGF in its White Paper ahead of the interim discussion on the EU budget due by 2009.

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  Proposal for a Regulation establishing the European Globalisation adjustment Fund, March 2006, COM(2006) 91 final, 2006/0033 (COD).

(2)  Impact assessment regarding above-mentioned regulation, SEC(2006) 274/2.

(3)  EU Competitiveness and Industrial Location, Bureau of European Policy Advisors to the Commission, BEPA (2005), 26 October 2005.

(4)  SEC(2006) 274.


23.12.2006   

EN

Official Journal of the European Union

C 318/42


Opinion of the European Economic and Social Committee on the Proposal for a directive of the European Parliament and of the Council on the exercise of voting rights by shareholders of companies having their registered office in a Member State and whose shares are admitted to trading on a regulated market and amending Directive 2004/109/EC

COM(2005) 685 final — 2005/0265 (COD)

(2006/C 318/06)

On 31 January 2006 the Council decided to consult the European Economic and Social Committee, under Article 95 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for Economic and Monetary Union and Economic and Social Cohesion, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 20 July 2006. The rapporteur was Mr Cassidy.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 83 votes to 9 with 18 abstentions.

1.   EESC conclusions and recommendations

1.1

The EESC welcomes the Commission proposal as barriers to cross-border voting provide distortions of the single market.

1.2

Share blocking, i.e. the obligation to deposit or block shares for a few days before a general meeting to be able to vote still exists in several EU countries. Indeed, the practice is mandatory in some. It is an expensive practice, which prevents shareholders from negotiating shares in advance of the general meeting. It is also considered by the majority of institutional investors as one of the greatest obstacles to voting. Article 7 of the proposed Directive eliminates any proposal to ‘block’ shares by requiring them to be deposited ahead of the general meeting. The EESC particularly welcomes this, though aware that the number of countries where this is still permissible is limited.

1.3

The EESC believes that the Directive should acknowledge the drive for better regulation and draws attention in particular to paragraph 34 of the Interinstitutional Agreement on better lawmaking of December 2003, paragraph 34 of which encourages Member States to ‘draw up, for themselves and in the interests of the Community, their own tables, illustrating as far as possible, the correlation between this Directive and their transposition measures, and to make them public’.

1.4

The EESC would like to see greater use of electronic voting to improve transparency and to encourage shareholder participation but believes this should be left to the companies concerned but wishes Member States to avoid imposing obstacles to wider use of electronic participation in general meetings.

1.5

Following from the preceding paragraph, the EESC expects a wider use of secure Internet voting perhaps including the use of SMS. This should be encouraged but not imposed by an EC Directive.

1.6

The EESC particularly welcomes the proposals for Proxy Voting set out in Article 10. It especially welcomes the removal of constraints on Proxy Voting whereby, in some Member State, ‘Proxies’ are restricted to relatives of the shareholders.

1.7

The EESC supports the idea that Member States may set a single date, with reference to a specified number of days before the general meeting, and may provide the company shall not be obliged to respond to questions which are submitted after that date.

1.8

The EESC would like to see a strengthening of Article 5 concerning the supply of information to shareholders prior to a general meeting.

2.   The Commission's proposal

It deals with obstacles to cross-border voting for shareholders.

2.1

Due to the recent spate of scandals connected with poor Cooperate Governance in the EU and in the USA, there is a need to encourage shareholders to play a more active part by voting at general meetings. The proposal under consideration is aimed at protecting the rights not only of shareholders in the EU but elsewhere in the world too.

2.2

This proposal aims to improve Corporate Governance in EU listed companies by enhancing the rights shareholders are able to exercise in relation to company meetings. In particular, it seeks to achieve this by ensuring that shareholders owning shares in companies registered and listed in another Member State may vote without difficulty at company meetings.

2.3

The draft Directive addresses the following four significant issues:

(a)

the abolition of ‘share-blocking’;

(b)

sufficient advance notice for meetings (including a requirement that all general meetings of shareholders be called with at least 30 days' notice);

(c)

removal of legal obstacles to electronic participation;

(d)

the ability to vote without attending the meeting.

2.4

This proposal is one of the short-term measures put forward in the communication from the Commission to the Council and European Parliament of 21 May 2003 (1) entitled ‘Modernising Company Law and Enhancing Corporate Governance in the European Union — a Plan to Move forward’.

2.5

The Commission notes that the process of voting at company general meetings differs widely across Member States and is often a complex procedure. It is further complicated when shares are held across EU borders.

2.6

The Commission believes that existing legislation at EU level does not address sufficiently the cross-border voting problem. At present, under Article 17 of Directive (2004/109/EC) the ‘Transparency Directive’, companies are required to make a limited amount of information available in relation to company meetings. But the Transparency Directive does not deal with the shareholder voting process.

2.7

Voting can be a complex process. Shares are often held on behalf of investors by intermediaries. Where this is the case, voting can involve a chain of events which encompasses companies, registrars, custodian banks, investment managers, central securities' depositories and proxy voting agencies.

3.   Options

3.1

There is no guarantee that the market will react quickly enough to improve shareholders' rights nor that appropriate legislative change will take place in all Member States to deal with the problem of the complexity of the voting process.

3.2

A Commission Recommendation has no legal force but would offer flexibility for Member States to implement it into the national systems on the basis of Commission guidelines.

A Recommendation would not guarantee the introduction of minimum standards in key areas which are the origin of cross-border voting problems and increased costs, such as share-blocking where what deters investors is the possibility that such a requirement be present at national level.

3.3

A Regulation would introduce a uniform treatment, irrespective of Member States laws. It could also guarantee the introduction of a tight common framework for cross-border related issues. It would have the additional advantage of avoiding Member States ‘gold plating’ a directive.

The Commission believes that the costs of a regulation could be significant since it would not be possible to offer flexibility across the differences that characterise legal traditions in EU Member States.

3.4

A Directive would allow for differences in Member States' practices, preventing imbalance between different classes of shares and shareholders and favouring basic, minimum standards.

4.   Costs and benefits

4.1   Benefits

4.1.1

The main beneficiaries from the proposal, in the short term, will be institutional investors that currently own cross-border shares in their portfolios. The existence of costs, associated with obstacles to cross-border voting means that investors are unable to become as actively engaged in the governance of companies as they may wish.

4.1.2

Over the longer term, the proposal may encourage smaller investors, who are currently deterred from holding cross-border shares by the high costs associated with voting, to increase their holdings in such shares. This will enable them to further diversify their portfolios so reducing risk. Overall, in the longer term, the proposal should give rise to greater liquidity in European capital markets.

4.1.3

Currently, a number of obstacles to cross-border voting exist. Share blocking remains a problem in some countries and is perceived by many investors to represent a serious obstacle to voting. In this respect it represents an obstacle to the efficient operation of cross-border capital markets. In addition, there is confusion among investors as the precise nature of blocking arrangements across EU States. This too represents a serious cost for investors, which would be reduced by the draft directive.

4.1.4

There is an unfair distinction between domestic and cross-border shareholders regarding the information made available to cross-border shareholders relating to a general meeting. The Commission draft ensures that adequate and timely information is available across all markets and should, therefore, help to alleviate this problem.

4.1.5

The jurisprudence of the European Court of Justice (ECJ) emphasizes the need for Member States to avoid abuse by one class of shareholders prejudicial to other classes.

4.1.6

Proxy voting and re-registration requirements are often costly and there is some evidence based on the Commission Impact Assessment to suggest that the level of these costs effectively discourages small funds from voting. The Commission's proposal should simplify the process for the appointment of proxies and clarify who can be appointed as proxies and enhance the rights of proxies in certain countries.

4.1.7

In cases where the Chairman of the meeting holds shareholders' Proxies, he/she should be obliged to vote them strictly according to those shareholders' wishes.

4.2   Costs

4.2.1

A uniform notice period, as proposed, would introduce an element of inflexibility for those Member States, which require only a 14 days notice period for the calling of an Extraordinary General Meeting (EGM).

4.2.2

The requirement to produce written answers to shareholders' written questions is essential.

4.2.3

Articles 5 and 7 of the draft Directive laid on 30 days between the record date and the date of the meeting in order to assist shareholders in being able to vote their shares.

5.   Specific comments

5.1

The EESC welcomes the Commission proposal as barriers to cross-border voting provide distortions of the single market.

5.2

As the financial sector is an important influence on the economy and on employment growth, anything which inhibits shareholder participation should be discouraged. The Commission proposal sets out to do that.

5.3

Currently cross-border voting is a priori more expensive for non resident shareholders than those resident in the country in which the company concerned has its shares quoted, it is an example of market distortion.

5.4

The Committee believes that there are too many constraints at present, which make proxy voting in some Member States unduly cumbersome.

5.5

Share blocking, i.e. the obligation to deposit or block shares for a few days before a general meeting to be able to vote still exists in several EU countries. Indeed, the practice is mandatory in some. It is an expensive practice, which prevents shareholders from negotiating shares up to weeks in advance of the general meeting. It is also considered by the majority of institutional investors as one of the greatest obstacles to voting.

5.6

The EESC shares the Commission's view that the late availability of information relevant to a general meeting or its incompleteness or resolutions in summary form or short noticed periods are among the major obstacles which non-residents face when seeking to exercise their rights as shareholders. All relevant documents including auditor's reports, replies to shareholders' questions and notices convening general meetings, and the motions to be submitted to such meetings should be made available electronically as well as physically.

5.7

Article 8 concerns participation in the general meeting by electronic means. As technology moves so rapidly, the Commission is proposing that Member States ‘shall not prohibit the participation of shareholders in the general meeting by electronic means.’

5.8

The Commission's text does not specifically deal with the problem of ‘barer’ shares, communication with whom currently is largely through newspaper advertisements. The EESC believes that electronic communication is more modern, quicker and certainly cheaper.

5.9

Article 10 clarifies the arrangements for Proxy voting and abolishes the arrangements whereby certain companies impose restrictions as to the person who can be granted a Proxy.

5.10

The option of doing nothing, in other words to leave the present situation as it is does not recommend itself to the EESC. The obstacles make cross-border voting prohibitively expensive for small shareholders and very costly for institutional investors.

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  COM(2003) 284 final ‘Modernising Company Law and Enhancing Corporate Governance in the European Union — A Plan to Move Forward’.


23.12.2006   

EN

Official Journal of the European Union

C 318/45


Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council establishing common rules for the provision of basic information on Purchasing Power Parities and for their calculation and dissemination

COM(2006) 135 final — 2006/0042 (COD)

(2006/C 318/07)

On 20 July 2006 the Council decided to consult the European Economic and Social Committee, under Article 262 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for Economic and Monetary Union and Economic and Social Cohesion, which was responsible for the Committee's work on the subject, adopted its opinion on 20 July 2006. The rapporteur was Mr Santillán.

At its 429th plenary session, held on 13 and 14 September (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 182 votes to 3 with 12 abstentions.

1.   Conclusions and recommendations

1.1

The EESC welcomes the proposal for a Regulation establishing a legal basis for the implementation of Purchasing Power Parities (PPP), since this will improve the transparency, timeliness and quality of the whole process of PPP production, at both Community and national level.

1.2

Given the importance of the issue addressed by this proposal and the need for binding rules that define the competences of the Commission and Member States and establish uniform bases for the calculation and dissemination of information on PPP, the Committee recommends the immediate approval of this draft Regulation.

1.3

Nevertheless, the EESC notes that currently, due to cost reasons, the Commission (Eurostat) calculates PPPs by countries, not by regions (1). However, these calculations are used, inter alia, to evaluate the economic performance of regions. Existing information shows that — within the Member States — there are sometimes considerable regional differences in the prices of goods and services. Although the statistical institutes that gather basic information apply spatial correctors, it is essential that such correctors adequately prevent distortions in calculating PPPs. Therefore, it is recommended that Member States make every effort possible, both economically and technically, to ensure that spatial correction coefficients reflect as precisely as possible geographical differences in prices.

1.4

For the reasons stated above, the minimum period of six years for the revision of the spatial coefficients seems too long and should be reduced. Similarly, since the frequencies stipulated in the draft Regulation for the provision of basic information are minimum frequencies (2), information on prices should if possible be supplied every two years (3) (the draft stipulates a minimum of three years).

1.5

Generally speaking, it should be stressed that an effort is needed to increase the efficiency of the EU's statistical apparatus, in terms of both technical and human resources and coordination between Eurostat and national statistical institutions, which have important responsibilities in the calculation of PPPs.

2.   Purchasing Power Parities (PPPs)

2.1

The Eurostat-OECD PPP Programme was established in the early 1980s to compare, on a regular and timely basis, the GDP of the Member States of the European Union and of the OECD (4). As such, PPPs are types of currency conversion rates that convert economic indicators expressed in nominal national currencies to a common artificial currency called Purchasing Power Standard (PPS), which equalises the purchasing power of different national currencies.

2.2

Economic volume aggregates in PPS are obtained by dividing their original value in national currency units by the respective PPPs. GDPs of countries expressed in PPS by using PPPs as conversion factors reflect a pure volume comparison, since the price level component has been eliminated.

2.3

PPPs are both price deflators and currency converters. With the launch of the euro in the euro-zone Member States, for the first time prices can be compared directly between those countries, although the euro has a different purchasing power, depending on national price levels. Therefore, for the non-euro-zone countries PPPs are currency converters and eliminate the effects of different price levels, while for the euro-zone countries they fulfil only the latter, price-deflator function.

2.4

PPPs are calculated using a basket of comparable goods and services, taking into account, inter alia, the Classification of Individual Consumption by Purpose (COICOP (5))and the Classification of Products by Activity (CPA). The groundwork is carried out in one or various cities within the economic territory (generally only in the capitals of Member States). Most Member States apply spatial correctors in order to take account of regional differences, although there are some Member States that only take into account data from the capital because their small geographic area means that there are no regional differences.

3.   PPPs and Gross Domestic Product (GDP)

3.1

GDP reflects the results of all activities of economic operators within a given economic territory and within a given period, usually a year. GDP is calculated in accordance with a system of national accounts, which, for the EU, is the European system of integrated economic accounts 1995 (ESA-95). GDP can be measured from the production, the expenditure and the income side. For PPP purposes the expenditure measure is particularly important. It reveals the extent to which the goods and services produced (or imported) by the economy of a country are used for private consumption, public consumption, capital formation or exports.

3.2

In order to obtain a real comparison, it is necessary to use conversion factors (spatial deflators), which reflect the differences in the level of prices between countries. Exchange rates cannot be used as they usually reflect elements other than price differences alone.

3.3

Therefore, PPPs between various countries' currencies have been specifically developed to be appropriate for use as spatial conversion factors.

4.   Uses for PPPs

4.1

Initially the major users were international organisations such as Eurostat, the IMF, the OECD, the World Bank and the United Nations. But over time the use of PPP statistics has spread and now there are many users: government agencies, universities, research institutes, as well as public and private enterprises. Banks use PPPs for their economic analyses and to monitor exchange rates; individuals and their employers use them to calculate remuneration when they move from one country to another.

PPPs may also be used in transnational collective bargaining on wages.

4.2

PPPs are vital indicators for the EU from both the economic and political angles. Firstly, the rules state that they are to be used for the Structural Funds (6). Secondly, they are an obligatory benchmark for the Cohesion Fund (7). Nevertheless, it should be pointed out that in the first case (Structural Funds) the calculation is based on per capita gross domestic product (GDP), while in the second (Cohesion Fund) it is based on gross national product (GNP). The draft Regulation under consideration here refers only to GDP (8).

4.3

PPPs are also used for establishing the correction coefficients to be applied to the remuneration and pensions of officials and other servants of the European Communities (9).

5.   Proposal for a Regulation

5.1

The purpose of the proposed Regulation is to fill a legal vacuum by establishing a legal framework for the calculation of PPPs. It is aimed at improving transparency and the quality of the data provided by the Member States, through common rules for the provision of basic information (Art. 1). The intended objective would not only benefit Eurostat as coordinator of the results, but also the statistical institutions of each country.

5.2

Definition of roles and responsibilities. The Commission is to be responsible, through Eurostat, for coordinating the basic information, calculating and publishing PPPs and adjusting methodology in consultation with Member States (Art. 4.1), while Member States are to provide basic information, issue written certification of the survey results and ensure the validity of the data (Art. 4.2).

5.3

The statistical institutions of the Member States are to transmit the basic information to Eurostat in accordance with common parameters and in a common technical format (Art. 5 and Annex I).

5.4

The statistical units are those defined in Council Regulation (EC) No 696/1993 or others to be established at a later date (Art. 6), and the Commission and the Member States are to set up a quality control system (Art. 7).

5.5

Eurostat calculates PPPs once a year (Art. 8) and will be responsible for publishing these at an aggregated level for each Member State (Art. 9).

5.6

The draft Regulation does not require Member States to undertake surveys solely for the purpose of establishing the correction coefficients to be applied to the remuneration and pensions of Community officials and other servants (Art. 10).

5.7

Temporal and spatial adjustment coefficients. PPPs are calculated from the national annual average prices (Article 2(2)). Given that ‘data collection may be limited to one or more locations within the economic territory’ and furthermore ‘to a specific period of time’, Member States should apply a temporal adjustment coefficient (dating back no more than one year) and a spatial adjustment coefficient (dating back no more than six years) (Annex I Methodology, sections 2 to 4).

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  There are 254 NUTS 2 regions. Regulation (EC) No 1059/2003, annex 1.

(2)  Annex I, Methodology, 2.1.

(3)  The prices in question are ‘prices of consumer goods and services and related representativity indicators’, ‘prices of equipment goods’ and ‘prices of construction projects’.

(4)  Nevertheless, the origins of international price and volume comparisons of GDP can be traced back to the experimental comparisons carried out by the Organisation for European Economic Cooperation (OEEC) in the 1950s.

(5)  System used by international bodies (United Nations, IMF etc.).

(6)  According to Council Regulation 1260/1999, the Structural Funds apply to those regions whose per capita GDP, measured in PPPs, is less than 75 % of the Community average. This is also the case for those countries that have subsequently joined the EU (Annex II of the 2003 Act of Accession).

(7)  With regard to the Cohesion Fund, Article 2(1) of Council Regulation (EC) 1164/1994 of 25 May 1994 states that the Fund applies to ‘Member States with a per capita gross national product, measured in purchasing power parities, of less than 90 % of the Community average’.

(8)  Article 3 includes the following definition: ‘“Purchasing Power Parities” or “PPPs” means spatial deflators and currency converters, which eliminate the effects of the differences in price levels between countries, thus allowing volume comparisons of GDP components and comparisons of price levels’.

(9)  The Staff Regulations of Officials of the European Communities and the Conditions of Employment of other Servants of the European Communities, Annex XI, Art.1 (‘The economic parities shall be calculated in such a way that each basic component can be (…) checked by a direct survey at least once every five years’.


23.12.2006   

EN

Official Journal of the European Union

C 318/47


Opinion of the European Economic and Social Committee on the Proposal for a Decision of the European Parliament and of the Council on a paperless environment for customs and trade

COM(2005) 609 final — 2005/0247 (COD)

(2006/C 318/08)

On 17 January 2006 the Council decided to consult the European Economic and Social Committee, under Article 95 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 12 July 2006. The rapporteur was Mr Burani.

At its 429th plenary session, held on 13 and 14 September (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 190 votes with three abstentions.

1.   Introduction

1.1

The Commission's proposal concerns a new electronic customs project which should ultimately make the European customs system fully automated, interoperable, secure, accessible and efficient, on a completely electronic and paperless basis. This is the necessary adjunct to implementation of the new Community Customs Code proposed by the Commission (1), on which the EESC has issued a separate opinion.

1.2

Adopting the proposed computerised system requires a joint and coordinated effort by all the Member States, with respect not just to customs, but also to border agencies other than customs, which will have the task of putting the concepts of the single window and the one-stop shop into practice. These two objectives will make customs procedures easier, faster and less costly for operators, and facilitate risk management controls by customs authorities.

1.3

The Member States have already invested substantially in setting up computerised customs systems, but there are considerable differences between these, in terms both of their level of sophistication and of rules and data used. Thus the current state of harmonisation is inadequate, and there is the even more serious problem, as yet unresolved, of lack of interoperability between systems.

1.4

Interoperability will allow information to be exchanged between customs authorities in the different countries. Evidencing concern for citizens, the proposal also makes it possible to provide interfaces with trade, not just to allow implementation of the single window principle, but also to guarantee exchange of information. When it is fully effective, the new computerised system will represent a decisive step towards realising a single internal market, with only external borders — if only where customs are concerned. It is also important to remember that the global nature of markets means relations with third countries must be taken into account, a factor that is not mentioned in the Commission document.

2.   General comments

2.1

The Commission notes that the computerisation objectives for interoperable systems could also have been achieved by setting up a centralised customs system. However, it says that such a solution is not possible for various reasons, including the difficulty of transferring responsibility from the Member States to the Commission, which would go against the principles of subsidiarity and proportionality. However, the real reason is probably that the Member States are loath to relinquish their prerogatives, knowing that a portion of customs revenues falls directly under the Community budget. The EESC believes that Community customs management should be one of the long-term objectives of the Union; this has advantages in terms of simplicity, reliability and cost, as well as the possibility of interconnecting with other EU and third country systems. With the potential delays to the implementation of the basic systems developed by each of 25 member countries, there is a need to evaluate whether it would not be preferable to implement fully automated systems such as the Automated Import System and Automated Export System linked through a Single European Access Point.

2.2

The Commission's initiative is necessary in the first place because introduction of the new Customs Code requires that procedures be consistent with the new rules. It is also one of a series of measures adopted in various sectors in the context of eEurope and eGovernment (2); more specifically it follows up on the commitments made in 2003 in the Commission's communication to the Council on ‘A simple and paperless environment for Customs and Trade’ (3). However, those commitments were already made — at least with regard to introducing a paperless environment — in the ‘Customs 2007’ programme (4) and confirmed in the 2004 changes to the Customs Code regulation (5).

2.3

The EESC welcomes the main innovations introduced with the system proposed by the Commission: networking of national systems, the setting-up of an interface for operators based on a single window, the possibility of submitting customs clearance requests electronically and integrated risk management are undeniably major advances, provided the costs to the tax-payer and to operators are sustainable. It would therefore be as well to consider the impact of these radical changes on customs officials (resources, training, career paths, adaptation).

2.4

However, the EESC wishes to make some comments on the integration of computer systems and their complementarity. The Commission aims to achieve full interoperability of customs systems: this means that customs authorities must be able to exchange information with each other and with ‘other authorities involved in the international movement of goods’. This definition clearly does not include authorities responsible for collecting VAT; however, a link between customs and VAT staff could be useful, at least in certain cases and for certain goods, in order to control counterfeiting of origin marking. This is nothing new, of course, but it is a phenomenon that is on the increase: goods imported from third countries are often circulated (with payment of VAT) within the Community bearing labels of European origin or false ‘European’ labels.

2.5

The EESC would also draw attention to the second recital of the proposal for a decision: ‘The pan-European eGovernment action … requires measures to increase the efficiency … to help combat fraud, organised crime and terrorism ….’ The intention is clear; what is less clear is how the objective can be achieved by the provisions contained in the proposal. Collection of customs data cannot be used for other purposes without setting up a system for communicating with other systems.

2.5.1

In December 2004 the Council adopted the Hague Programme based on a Commission assessment (6) and a European Parliament recommendation of 14 October 2004. This programme sets out a series of measures and actions to strengthen EU security, with a view to ‘securing police, justice and judicial cooperation’. A follow-up document (of 10 June 2005) presented an action plan for implementing the Hague Programme, which referred to a Council of Justice and Home Affairs ministers resolution of 30 March 2004 on customs cooperation, and a communication on the fight against cross-border trafficking in restricted or prohibited goods. In another follow-up document (7) customs cooperation was again cited as a priority issue. All the projects envisaged in the above-mentioned documents concern the availability of information for law enforcement purposes, a matter which is also mentioned in the Hague Programme. Given the overall context and the nature of the projects under way, it seems obvious to the Committee that in designing a computerised customs system intended to last, it is essential to ensure that, when the system starts operating or at a later point, the customs database interacts with other systems, especially with internal, European and third country security systems. Respect for privacy, professional secrecy and data protection must, of course, always be paramount.

2.5.2

This concern is not raised at all in the Commission document, except in the quote in point 2.5 above. Nor, on the other hand, does the Commission's explanatory memorandum anywhere mention the Hague Programme; the section ‘Consistency with the other policies and objectives of the Union’ mentions only the Lisbon strategy and the eEurope and eGovernment initiatives. Notwithstanding Article 3(d) — which is discussed below — such a major omission cannot be coincidental, and the Commission should clearly explain the reasons for it. In any case, the fact remains that it would not be acceptable to simply postpone an initiative which should be adopted without delay.

2.5.3

When it was drawing up this document, the Commission organised six seminars in the space of two years; it consulted users; and it discussed the matter in the Customs Code Committee, the Customs 2007 electronic customs group and the Trade Contact Group. But there is no mention of contacts with Europol, OLAF or other directorates-general of the Commission. A system cannot be planned solely according to the requirements of its direct users; if it must be designed to connect with other systems, there must be an understanding of their characteristics and needs. The EESC thinks that the reservations it expressed in its opinion on the Community Customs Code are now being borne out in so far as there is no proper awareness of the interdependence between different public administrations in the fight against crime.

2.5.4

A complete change in approach along the lines indicated in the previous point would probably be difficult owing to the time constraints fixed by the programme with respect to implementation. However, it would surely be possible now to provide for security measures for ‘sensitive goods’ (e.g. arms, explosives, nuclear materials, machines and equipment for the chemicals, nuclear or defence industries, narcotics, alcohol and tobacco). Such measures could form the basis for surveys that would be forwarded to the relevant authorities automatically or on request.

2.6

In accordance with the subsidiarity principle, the financial burden on the Community budget is that required to ensure system interoperability, a single interface and customs portals. This cost is estimated at EUR 180 million, divided into incremental annual appropriations, starting at EUR 4 million in 2006 and rising to EUR 111 million from 2011. The EESC endorses this, but is puzzled by the decision to charge the cost of national customs portals to the Community budget. Even though portals are in principle available to all operators, whether national or from another EU country, it is likely that each will be used principally by national operators. It would therefore make more sense for the cost of portals to be borne by individual Member States rather than by the Community. Of course, the terms would be different if the Commission were talking about European portals, which it does not refer to explicitly.

2.7

As regards implementation deadlines, the Commission has drawn up a list of milestones which are mandatory for all the Member States. These are based on the date of publication of the Decision in the OJ: three years for adopting interoperable automated customs clearance systems, registration systems for economic operators and information portals; five years for setting up a network of single access points and an integrated tariff environment corresponding to Community standards; and six years for providing single window services. The EESC considers these deadlines, especially the first one, to be rather optimistic: three years is not a long time bearing in mind that this has to include several months for testing the programmes and sharing information with the other parties involved. Moreover, not all Member States have the same level of computerisation or availability of financial and human resources. If failure by one or more Member States to meet the deadlines forced the Commission to grant extensions, this would jeopardise the efficiency of the system and above all its credibility. Therefore the current Multi-Annual Strategic Plan (MASP) needs to be revised taking into account:

the need for all Member States to have fully implemented the system before it goes live, and

the need for business to have a minimum of 12 months in which to prepare systems, after receipt of full requirements from customs in their Member State. Industry and trade should not be obliged to submit the Summary declarations for imports and exports before homogenous systems are fully operational.

3.   Specific comments

3.1

Article 2: Objectives. The objectives include seeking a common approach to the control of dangerous and illicit goods. It would be advisable to re-formulate this objective in the light of the EESC's suggestion in point 2.5.4.

3.2

Article 3: Data exchange. Under Article 3(d), customs systems must allow data to be exchanged with ‘other administrations or agencies involved in the international movement of goods’. The EESC has already expounded its views on the inadequacy of this definition (see point 2.5 ff.). If the Committee's suggestion that the Hague Programme be included under the heading ‘Consistency with the other policies and objectives of the Union’ is taken on board, the wording of this point must be adapted accordingly. Whatever happens, the text must be worded more clearly so that it is not open to interpretation: it is not clear whether it refers to ‘administrations … involved in the international movement of goods’, as an alternative to ‘agencies’, or whether the reference is to ‘administrations’ in general; if the latter is the case, it should be clearly specified that by using this term the Commission wishes to signal a new approach that is consistent with the Hague Programme. The current rather vague wording and its interpretation leave too much room for uncertainty.

3.3

Article 4: Systems and services, and timetable. As noted in point 2.7 above, the deadlines for implementing the system seem over-optimistic: the Commission should discuss them again, from a technical point of view, with the Member States and with their bodies that are directly involved, so as to be sure that all those concerned explicitly guarantee they are capable of completing the tasks within the required time frame.

3.4

Article 9: Resources. The article divides responsibility for the human, budgetary and technical resources required between the Commission and the Member States: the former is responsible for the Community components and the latter for the national components. The article is correctly formulated, but it must be read in conjunction with Article 10 as regards the meaning and substance of the terms ‘Community components’ and ‘national components’.

3.5

Article 10: Financial provisions. This article is also properly formulated, but its interpretation might be problematic. The third paragraph states that the Member States shall bear the costs of the national components, ‘including interfaces with other governmental bodies and economic operators’. It must be assumed that portals — which generally operate in the language of the Member State and are tailored to the needs of that country's economic operators — will be considered national components. However, the explanatory memorandum (see point 2.6 above) states that portals are regarded as Community components, which would not be an obvious interpretation to anybody reading only the text of the article. The EESC thinks that this point should be revised: in substance, if the EESC's comments are accepted, and otherwise at least in form, for the sake of transparency.

3.6

Article 12: Reports. Member States must submit a report by 31 December each year on progress made and results achieved. The Commission in turn sends a consolidated report to the Member States by 31 March each year, which should include the results of any monitoring visits and other controls. There is nothing exceptionable about this in principle, but the Committee wonders what the implications of ‘monitoring visits’ are and whether their results should be made public.

3.7

Article 13: Consultation with economic operators. This article states that the Commission and the Member States shall ‘regularly’ consult economic operators at all stages of the preparation, development and deployment of the systems and services provided for. Consultation is to take place through a mechanism which brings together a representative selection of economic operators on a regular basis. The EESC considers this type of mechanism to be consistent with normal Community practice and with the principles of consultation and transparency; however, experience shows that consultation must not draw attention to too many disparate demands and contradictions that might create obstacles which would take a long time to overcome and require unreasonable compromises. The consultative phase should therefore be compatible with the need to reach a prompt decision.

3.8

Article 14: Accession and candidate countries. This article states that the Commission shall inform accession and candidate countries about initiatives taken and progress made in the various phases, and allow them to take part. The wording here is vague: it is not clear whether the countries in question may take part actively or only as observers; whether they are allowed to introduce parallel customs systems with a view to their accession; and in such cases whether they would be entitled to funding from the Community budget. The EESC asks that the wording of this provision be made more transparent.

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  COM(2005) 608 final.

(2)  Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions, COM(2003) 567 of 26.9.2003.

(3)  COM(2003) 452 of 24.7.2003, quoted in the EESC opinion on the Customs Code.

(4)  COM(2002) 26 of 21.3.2002, subject of EESC opinion in OJ C 241 of 7.10.2002.

(5)  COM(2003) 452 of 4.8.2003, subject of EESC opinion in OJ C 110 of 30.4.2004.

(6)  COM(2004) 401 final.

(7)  COM(2005) 184 final.


23.12.2006   

EN

Official Journal of the European Union

C 318/51


Opinion of the European Economic and Social Committee on Implementing the Community Lisbon programme: Proposal for a Directive of the European Parliament and of the Council on payment services in the internal market and amending Directives 97/7/EC, 2000/12/EC and 2002/65/EC

COM(2005) 603 final — 2005/0245 (COD)

(2006/C 318/09)

On 18 January 2006, the Council decided to consult the European Economic and Social Committee, under Article 47(2) and Article 95 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 12 July 2006. The rapporteur was Mr Frank von Fürstenwerth.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 191 votes to one, with three abstentions:

1.   Summary

1.1

The European Economic and Social Committee (EESC) agrees with the European Commission that, for the establishment of the internal market, it is essential that all internal frontiers in the Community be dismantled so as to enable the free movement of goods, persons, services and capital. A key element in this process is a properly functioning single market in payment services. Such a market, however, is not yet in place. Following the successful introduction of the euro, the EESC now also supports the establishment of a Single Euro Payments Area (SEPA).

1.2

The EESC backs the European Commission's efforts to establish a proper legal framework for a Single Euro Payments Area and feels that the proposal for a directive points the way forward.

1.3

The Committee welcomes the action already taken by the European Commission and the European banking industry to establish a Single Euro Payments Area, the (really quite ambitious) aim of which is to make cross-border euro payments within the European single market simple, convenient, safe and cheap.

1.4

The Committee notes, however, that, in submitting this proposal for a directive, the European Commission has selected a very broad-based approach to the rules in this area that clearly goes beyond the legal framework required for cross-border payment services. The EESC is thus concerned that, not least given the transposition periods required by the Member States and payment service providers and users, the target of establishing the Single Euro Payments Area in 2008 could be missed because of an overloaded legal framework that goes beyond what is necessary to achieve the objective at hand. The Committee urges that more consideration be given to self-regulation and co-regulation tools.

1.5

All that should be needed to achieve the European Commission's objective of launching the Single Euro Payments Area in 2008 is to establish the legal basis for cross-border direct debits and to rework the requisite legal provisions set out under Title II (Payment service providers) and Title IV (Rights and obligations in relation to the provision and use of payment services) of the proposed directive (in relation, among other things, to the authorisation, revocability and refund of direct debits as set out in Title IV). This would make it possible to meet the 2008 launch date for the Single Euro Payments Area.

1.6

Not least in the light of the legal provisions already in place, the EESC feels that the principle of better regulation is only served by focusing on those areas that really do require regulatory action. Hence, in the interests of both providers and users of payment services, the basic premise of the proposed directive should be to promote and facilitate payments, not to hamper them by red tape that ultimately makes the systems more expensive and thus less acceptable to users.

1.7

The EESC would point to other issues arising in connection with the establishment of a single market in payment services, which it is not possible to resolve here. These include the security of electronic payments and related factors. The question of access to a current account, without which it is now virtually impossible to take part in economic life, is also becoming an increasingly important issue in the Member States.

1.8

The EESC recommends a series of specific changes to the proposal for a directive.

2.   Content of the draft directive

2.1

The proposal for a directive is designed to establish a uniform legal framework for SEPA, the main purpose of which is to facilitate cross-border payments. The proposal seeks to harmonise the different legal provisions in place in the Member States so as to:

enhance competition between national markets by creating a level playing field;

increase market transparency for payment service providers and users; and

standardise the rights and obligations of payment services providers and users.

The main provisions of the proposed directive are as follows:

2.2   Right to provide payment services to the public (Title II)

2.2.1

The harmonisation of market access requirements of non-credit institution payment service providers is designed to create a level playing field, instil more competition in national markets and reflect market developments in recent years, triggering market entry of a new generation of providers, i.e. payment institutions.

2.3   Transparency and information requirements (Title III)

2.3.1

Clear and consistent rules on transparency for payment services are intended to enhance competition by boosting user choice and protection. The European Commission is proposing information requirements for payment services to replace national rules.

2.4   Rights and obligations of users and providers of payment services (Title IV)

2.4.1

The proposal for a directive sets out the core rights and obligations of users and providers of payment services. The provisions are designed to make users more trustful of electronic payment systems and thus to secure the efficiency and acceptance of such systems.

3.   General comments

3.1

The European Economic and Social Committee supports the objective of the draft directive to establish a Single Euro Payments Area, particularly for cross-border payment services. The establishment of a single market in payment services is long overdue and should, as planned, be launched in 2008.

3.2

The European Commission has selected a very broad-based approach to the rules in this area. Indeed, some of the rules go beyond the legal framework required for a Single Euro Payments Area. This is particularly true since harmonised legal provisions are already in place for credit transfers (Directive 97/5/EC on cross-border credit transfers, Directive 2002/65/EC concerning the distance marketing of consumer financial services, and the E-money directive (2000/46/EC)).

3.3

Maintaining established, cost-effective and efficient procedures is no barrier to a Single Euro Payments Area. On the contrary, such procedures can be built upon as a conduit to standardisation, thereby safeguarding the level of security and efficiency that has already been achieved while at the same time making a high-calibre Single Euro Payments Area a reality through intelligent interface management. Guided by the principle of better regulation, the EESC advocates keeping the proposed provisions to the minimum required to improve payments within the European single market and urges that more consideration be given to self-regulation and co-regulation tools.

3.4

The EESC considers the Single Euro Payments Area to be a key prerequisite for transparent product development across Europe, with payment service providers free to compete with each other in a way that also benefits clients. Moreover, the EESC considers it important that consumers retain the existing freedom to use the payment instruments of their choice so that due account can be taken of customer preference.

3.5

One difficulty is access to payment systems by payment institutions that do not hold a banking licence. In the interests of fair competition, this requires a uniform level of prudential supervision. The fear otherwise is that competition will be distorted and that the operability and safety both of payment transactions and of payment service providers (e.g. bankruptcy) will be compromised.

3.6

The Committee recommends confining the proposed directive to the provisions — set out in Title II (Payment service providers) and Title IV (Rights and obligations in relation to the provision and use of payment services) — that are needed for any future European direct-debit scheme (in relation, among other things, to the authorisation, revocability and refund of direct debits). This should still make it possible both to adopt the directive and to transpose it into national law within the prescribed time frame so that the 2008 launch date for SEPA (including uniform conditions for payment service providers and SEPA Direct Debit) can be met.

3.7

The Committee very much welcomes the provisions of Article 79 of the proposal, under which, no later than two years after the directive is adopted, the Commission is to present an implementation report to the European Parliament, the Council and the European Economic and Social Committee.

4.   Specific comments

4.1

The Committee would make the following specific comments about the proposal for a directive:

4.2   Article 2(1) — Third-country transactions should not be included

4.2.1

Article 2(1) includes within the geographical scope of the directive payments to and from countries outside the European Union and the European Economic Area (third countries). This goes considerably beyond the objective of establishing a uniform legal framework within the European single market. Moreover, this provision may well lie outside the EU's legislative remit and also raises difficulties in that the European legislator is in no position to ensure that corresponding provisions are adopted in third countries. It is therefore wholly inappropriate to impose (as Article 67 does) strict liability for the execution of the transaction in a third country on the payment service provider of the payer without corresponding rules being in place in the third country.

4.2.2

The Committee recommends that the scope of the directive be confined to payment services within the European single market.

4.3   Articles 5 et seq. — A uniform level of prudential supervision is an essential element of fair competition

4.3.1

The prudential requirements that apply to the market access of payment institutions that do not hold a banking licence (Articles 5 et seq.) should diverge from those that apply to the banking sector only insofar as a payment institute is not comparable with a fully licensed bank. The fear otherwise is that competition will be distorted to the detriment of banks and that the operability of payment systems will be severely compromised. Moreover, if payment institutes that do not hold a banking licence do not meet the same conditions as banks in terms of risk-based equity, managerial competence and reliability, business plans, and the organisation and ongoing supervision of business operations, including any necessary sanctions, then the imposition of a rule granting such institutes access to payment systems could also undermine the integrity and operability of the European direct-debit scheme currently in the pipeline. Above all, however, consumer confidence in SEPA would be perennially compromised without an appropriate level of prudential supervision. This also includes the question of bankruptcy protection and the necessary arrangements for holding client funds separately.

4.3.2

The EESC therefore feels it is essential that all payment institutions should be subject to the same prudential supervision requirements in relation to the risks and dangers of payment transactions and that appropriate supervisory bodies should be equipped with the requisite powers.

4.4   Articles 30 et seq. — Information requirements must not be too formalised

4.4.1

The EESC agrees with the Commission that clear and consistent transparency rules are of key importance for consumers — and for the acceptance of SEPA. The information must be clear and easily understandable and must be presented in a readable form. Too varied and too frequent information may be counterproductive, however, and may make the situation less rather than more transparent. Moreover, private SEPA users need different information from commercial ones. The Commission also sows confusion — and generates extra costs — when it imposes different transparency requirements on similar cases. The Committee would draw particular attention in this regard to the distance marketing directive.

4.4.2

The selected approach to harmonisation — full harmonisation and mutual recognition — may well pose problems for consumers and consumer protection. The possibility cannot be discounted, for instance, that consumer protection standards will be lower than those already in place in individual Member States.

4.4.3

The provisions relating to the method of providing information under Article 30 should also be simplified. Particularly in cases where users are to be informed about changes in contractual conditions (Article 33) and about executed payments (Article 36) and received payments (Article 37), it should be possible, where this is the agreed custom, to retain the current practice — which is inexpensive for users — of making the information available via account statements or via online banking. It should also be possible to meet the information requirements using price tables or by posting the data on the internet. It should be stated in more explicit terms (Articles 31 und 37) that the prices of the various service elements covered by an aggregate fee need only be indicated separately to the client in cases where individual service elements involve separate and/or different product constellations.

4.4.4

For incoming and outgoing payments, it is important, from a user perspective, not only that a clear indication is given of both payer and payee, but also that the full payment reference data are included in the transfer details. This is the only way to secure fully automated referral for outstanding items and sums due.

4.5   Article 41, second sentence — All kinds of authorisation must be permitted

4.5.1

The EESC agrees with the Commission's approach whereby a payment transaction is to be considered as authorised only if the payer has consented to the payment order addressed to the payment service provider. Under the second sentence of Article 41, payers are required to give their consent by means of ‘explicit’ authorisation of ‘a payment transaction or a series of transactions’. The wording here is unclear. To require an explicit authorisation for each and every direct debit within a contractual relationship would impose serious constraints on any efficient and cost-effective direct-debit scheme.

4.5.2

To ensure the continued use of what consumers too perceive to be tried-and-trusted, cost-effective procedures such as direct debits, the directive should be geared towards minimum coordination rather than any full harmonisation that brooks no exceptions.

4.6   Article 48(2) and (3) — The burden of proof in cases of disputed payment transactions is not properly balance

4.6.1

Consumers will not accept SEPA if, in cases of disputed authorisation, they are faced with insurmountable difficulties relating to evidence. The EESC backs the Commission's efforts to facilitate matters for users on this front.

4.6.2

That said, such an approach must not result in the payment service provider being blocked from producing any counterevidence in the case of gross abuse. Yet, Article 48(2) makes it impossible for, the payment service provider to bring forward evidence of gross negligence or even intent on the user's part. If, however, it is no longer possible to bring forward evidence that a payment service user did in fact act with gross negligence or even intent, then this too is nothing short of an invitation to disregard any normal safekeeping requirements and to abuse the system. A rule of this kind also very much limits the scope to offer certain electronic payment methods.

4.6.3

The EESC would advocate fair burden-sharing. The onus is thereby on the payment service provider to furnish evidence that the holder of the payment verification instrument did in fact order the payment. If, however, the payment was made using special security features incorporating recognised safeguards against improper use, then the prima facie evidence should stand, i.e. that the payment service user either authorised the payment himself or herself or has at least acted in a grossly negligent manner. Moreover, no undue limits should be placed on national courts' scope to consider the evidence, especially since Member States' civil procedure laws are not harmonised.

4.7   Article 49 — Legal certainty must be established in the case of unauthorised payment transactions by introducing uniform cut-off periods for refunds

4.7.1

In the explanatory memorandum to the proposal for a directive, the European Commission makes the point that payment systems are used in some 231 billion transactions within the Community each year. This fact alone makes clear the need, at a certain point, for legal certainty as to whether a transaction was authorised or not. In order to establish an appropriate degree of legal certainty, the refund claim by the payment service user in the case of unauthorised payment transactions should be time-limited. The time limit should be fair. The EESC considers a time limit of one year to be appropriate.

4.7.2

Under Article 45, payment service users are, rightly, required to check their account transactions regularly and to raise any objections against unauthorised payment transactions without undue delay. It is therefore a consistent and balanced move to limit the refund claims of payment service users in respect of unauthorised payments to one year. This would give both payment service providers and payment service users the requisite legal certainty that, on expiry of that period, the payment is considered final. A one-year period would also tie in with the record-keeping requirement under Article 44.

4.8   Articles 49 and 50 — Liability allocation requires further consideration

4.8.1

The EESC feels that liability must be allocated in an appropriate way between service provider and user. Only then will consumers use the payment service concerned and only then will payment service providers be able to offer the service at reasonable prices.

4.8.2

The strict liability of the payment service provider for unauthorised payments proposed under Article 49 makes sense, in the EESC's view, provided users handle their payment verification instrument with the requisite care and in compliance with the contractual requirements.

4.8.3

The EESC feels that, as provided for under Article 50, it is appropriate to limit to EUR 150 the liability of users who, despite having taken the requisite care, fail to notice the loss of the payment verification instrument but duly notify the loss the moment it comes to their attention. However, users who fail to notify the loss without undue delay, even though they are obliged to do so under Article 46, thereby also depriving the payment service provider of the opportunity to avert or limit any damage, should be given no special treatment, in terms of the liability they bear, to the detriment of those users who do exercise the requisite care.

4.9   Article 53 — The refund period must be clearly fixed

4.9.1

The period during which a refund may be claimed is a key feature of the European direct-debit scheme. It is essential that all those involved in the payment procedure are able to determine when, precisely, the period ends during which a refund may be claimed on authorised payments. There is no guarantee of this, however, as the first sentence of Article 53(1) states that the period begins once information has been provided to the payer, yet neither the payee nor his or her payment service provider knows when the payment service provider of the payer actually informed the payer of the payment transaction on his or her account.

4.9.2

The reason is that, in practice, the interval for providing bank account statements varies widely. Sometimes, statements are provided only every quarter, sometimes every week, and sometimes even on a daily basis. This is a question of user preference and cost. Depending on the frequency of the information provided, therefore, the refund period may, to take these examples, be three months plus four weeks, one week plus four weeks, or even one day plus four weeks. It is thus more or less impossible to determine when the payment becomes final. This would pose a virtually insoluble problem for — and seriously jeopardise — the European direct-debit scheme currently in the pipeline.

4.9.3

The EESC therefore proposes that, in line with Article 53(1), a four-week period should start when the customer is informed, but should end at all events eight weeks after the entry on the payer's account.

4.10   Articles 60, 61 and 67 — A clear distinction must be made between the obligations of the payment service providers involved in executing the payment

4.10.1

Articles 60, 61 and 67 indicate that the payment is deemed to have been executed once the amount is credited to the payee's account. This represents a break, for no apparent reason, with existing European law on credit transfers. It lumps together the contractual obligations of the payment service provider of the payer on the one hand, and the payment service provider of the payee on the other. The payment service provider of the payer would thus subject to a requirement which is incumbent only on the payment service provider of the payee and which cannot be verified by the payment service provider of the payer.

4.10.2

The EESC therefore proposes retaining the principle governing payment rules currently enshrined under the European directive on credit transfers and applicable in a uniform manner across all the EU Member States. Under this principle, the payment service provider of the payer is responsible for the transaction until it reaches the payment service provider of the payee), while the payment service provider of the payee is responsible until the amount is credited to the payee's account.

4.11   Articles 60, 61 and 67 — The execution periods must be practicable

4.11.1

The EESC considers it essential that the execution periods be such that they represent a clear improvement on the present position, but that the technical implementation does not involve unreasonably high costs which would then make payments more expensive.

4.11.2

The execution periods of one banking business day provided for under Articles 60 and 61 (day on which the payment order is accepted plus one banking business day) could, under present circumstances, be too ambitious. Under the current European directive on cross-border credit transfers, the standard period is six banking business days (day on which the order is accepted plus five banking business days, plus one day for the funds to be credited = five days for the payment service provider of the payer to credit the payment service provider of the payee, plus one day for the payment service provider of the payee to credit the payee), although some deviation from these rules is possible. A number of regional and smaller payment service providers are indicating that they will be unable to meet this requirement. The planned (maximum) execution period (one day for the payment service provider of the payer to credit the payee) would be one sixth of the time frame permitted at the moment. According to payment service providers, the technical implementation of this rule would also involve unreasonably high costs, thus inevitably making payments more expensive. The European banking sector has entered into a voluntary commitment under the Credeuro Convention for a maximum execution period of three banking business days for euro payments, and a standard execution period of three banking business days for payments in other European currencies.

4.11.3

In the event that competitive disadvantages are suffered by regional and smaller payment service providers, the EESC recommends that an execution period of three days be set for an appropriate transitional period. This is not, however, to affect provision being made for shorter execution periods for purely national payment transactions (Article 64).

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


23.12.2006   

EN

Official Journal of the European Union

C 318/56


Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council on the law applicable to contractual obligations (Rome I)

COM(2005) 650 final — 2005/0261 (COD)

(2006/C 318/10)

On 24 February 2006 the Council decided to consult the Economic and Social Committee, under Article 262 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 26 July 2006. The rapporteur was Mr Frank von Fürstenwerth.

At its 429th plenary session, held on 13/14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 191 votes to one, with five abstentions:

1.   Summary of EESC conclusions and recommendations

1.1

The European Economic and Social Committee welcomes the Commission's plan for a European regulation on conflict-of-law rules in the field of contractual obligations. The regulation will develop European conflict-of-law rules in a logical way and close a loophole in the current system of Community law. The regulation is useful and necessary for the development of a single European area of justice, since the 1980 Rome Convention (1) that currently regulates this field is in need of modernisation but, as a multilateral agreement, the prospects of that happening are doubtful and would in any case involve time-consuming negotiations.

1.2

The Committee offers its encouragement to the Commission and urges it to complete its work as rapidly as possible, taking account of the proposals set out below, so that the regulation can enter into force.

1.3

The Committee welcomes the Commission's efforts to introduce full harmonisation so as to close the legislative gap that exists due to the absence of any European legal act applicable to the Member States in the field of conflict-of-law rules for contractual obligations. This will make matters much simpler for those applying the law, who, given that the regulation will be directly applicable in all Member States, can, in future, work on the basis of a single set of identical rules. The regulation is a necessary complement to the proposed Rome II regulation (2), which has reached an advanced stage in the legislative process. Together with the Rome II regulation, the present document will ensure that, for the first time, the EU has a (more or less) complete system of conflict-of-law rules on contractual obligations.

1.4

The Committee urges the Community legislative bodies to incorporate the following amendments:

Article 3(1)(3) should be changed into a rule of interpretation,

Article 3(3) should be amended so that a subsequent choice of the law applicable to consumer contracts may be made after a dispute has arisen,

the introduction of less rigid rules than those set out in Article 4(1) on the law applicable to particularly circumstanced exceptional cases should be considered,

with reference to Article 5, it should be checked whether and under what conditions the freedom to choose applicable law may also be granted in cases in which a company operates in the consumer's country or directs its activity to that country,

Article 22(c) should be deleted.

Work on the regulation should be completed as rapidly as possible so that it can enter into force.

1.5

The Committee is pleased to note that Ireland intends to become a party to the regulation on a voluntary basis. It regrets that the regulation will not apply in the United Kingdom and Denmark, as the impact of harmonisation will not be felt as strongly as could otherwise have been the case. The Committee urges the Commission to use all possible means to bring about the application or adoption of the regulation in these two countries.

2.   General comments

2.1   Grounds for the initiative

2.1.1

The regulation creates a unified set of conflict-of-law rules on contractual obligations in the EU. Admittedly, such a set of rules has to some extent already been in place since 1980, when the majority of western European states decided to conclude the Rome Convention. Other states subsequently acceded to the Convention. The vehicle of a multilateral convention was chosen because, at that time, the EC Treaty did not provide a legal basis for the adoption of an appropriate legal instrument by the Community. After over twenty-five years of applying the Convention, it is widely acknowledged as a real step forward, and the solutions which it provides remain broadly applicable today. However, revision and modernisation are needed to remedy certain acknowledged weaknesses. Given that the Rome Convention was a multilateral agreement, it can only be revised on the basis of a new round of negotiations, which would be time-consuming and uncertain in terms of outcome. However, this is no longer necessary as the TEC now includes a legal basis for a Community legal act in this area (Articles 61(c) and 65(b) of the TEC). To make it easier to apply the law, rules should be identical in all EU Member States. This means that the only possible legal instrument is a regulation.

2.1.2

In 2004 the Commission conducted a public hearing on the basis of a 2003 Green Paper (3). A large majority at the hearing were in favour of a regulation. The EESC (4) and the EP (5) have also spoken out in favour of modernising the Rome Convention and converting it into a European regulation.

2.2   The legislative background

2.2.1

The regulation should be seen in the context of the Commission's activities in the field of civil law and procedural civil law, which contribute to establishing a uniform European legal area and facilitating public access to the law. The Committee has on several occasions commented on a series of Commission proposals (6).

2.2.2

The initiative ties in particularly closely with the Commission's work on conflict of substantive laws, i.e. its proposal for the Rome II regulation. Rome II is complementary to Rome I and the two are entirely compatible.

2.3   Legal base/Subsidiarity/Proportionality/legal status

2.3.1

The regulation aims to harmonise conflict-of-law rules in the field of contractual obligations. The legal base for the harmonisation of conflict-of-law rules is Article 61(c) TEC, cf. Article 65(b) TEC. This means that the Commission is empowered to act where this is necessary for the smooth operation of the internal market. In the Committee's view this condition is met, as harmonising conflict-of-law rules will help to ensure equal treatment of economic operators in the Community in cross-border cases, increase legal certainty, simplify application of the law and thus promote willingness to enter into cross-border business. It also promotes the mutual recognition of legal acts by making it easier for nationals of other Member States to check that they are legally sound.

2.3.2

These objectives cannot be achieved through measures at the level of individual Member States, and they require EU action. EU action in this area is consistent with the subsidiarity and proportionality principles (Article 5 TEC).

2.4

The Commission has rightly chosen to use the form of a regulation, as, unlike a directive, it does not leave the Member States any room for manoeuvre in implementation; this would result in legal uncertainty, which should be avoided.

3.   Specific comments

3.1   Material scope, application of third-country law (Articles 1, 2)

3.1.1

The regulation is intended to apply to contract law conflict rules in civil and commercial matters (Article 1(1)). The Commission could therefore use the terminology of Council Regulation (EC) No 44/2001 (Article 1), which is also used in the proposed Rome II regulation, as this is clearly defined. The exclusion of tax, customs and administrative matters follows logically. Although it is not necessary to mention it, there is no harm in doing so.

3.1.2

The regulation is not intended to cover the entire area of conflict between civil law systems, not even to the extent of making it applicable to individual cases, for example to the evaluation of a contract law case. The Commission is well advised not to aim too high and thereby make the project unwieldy. Thus, the exclusion of questions involving the status or legal capacity of natural persons (Article 1(2)(a)) is justified, as these matters are traditionally dealt with in conflict-of-law rules by means of separate instruments (so far, nearly always multilateral agreements (7)) in view of their social implications. The exclusion of obligations arising from family relations and maintenance, and from property, marriage, wills and successions (Article 1(2) (b), (c)) is warranted for similar reasons, or should be dealt with in separate legal instruments.

3.1.3

The exclusion of obligations arising under the bills of exchange or cheques (Article 1(2)(d)), is justified by the fact that these matters are adequately dealt with in separate agreements (8), the scope of which extends beyond the Community and the continued existence of which should not be called into question.

3.1.4

The exclusion of arbitration agreements and agreements on the choice of court (Article 1(2)(e)) has to do with the fact that these matters are covered by international civil procedural law, as they can be better dealt with in this context and to some extent are also regulated in agreements whose applicability extends beyond the EU. The same arguments apply to evidence and procedure issues (Article 1(2)(h)).

3.1.5

The exclusion of company and association law matters and issues concerning legal persons in Article 1(2)(f) is unavoidable, as the issues in question are so closely bound up with the company statute as to require regulation in this context. Trusts are a specific feature of Anglo-American law. They were already excluded in the Rome Convention (Article 1(2)(g)), which the regulation rightly follows (Article 1(2)(g)).

3.1.6

The exclusion of obligations arising out of a pre-contractual relationship (Article 1(2)(i)) refers to matters of tort. These are part of the proposed Rome II regulation and their exclusion is therefore justified.

3.1.7

The Committee is pleased to note that Ireland intends to become a party to the regulation on a voluntary basis. It regrets that the United Kingdom has not decided to follow suit. In Denmark the regulation will not apply (Art. 1(3)) until an agreement on application is concluded by Denmark and the Community or until Denmark voluntarily transposes it into national law. The Committee urges the Commission to use all possible means to bring about the application or adoption of the regulation in these two countries. Opting out by individual Member States would undermine the objective of Europe-wide harmonisation of conflict-of-law rules which the regulation is intended to achieve. It would be unfortunate if the Rome Convention continued to apply to those countries as there will be discrepancies between the Rome Convention and the Rome I regulation. This might mean that, depending on the location of the court before which a case is heard — a matter which, despite the Brussels and Lugano Conventions and Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments (the Brussels I regulation) is still somewhat arbitrary — the same case could produce different judgements. Such a state of affairs would be difficult to accept in the Community.

3.1.8

The regulation requires the specified law to be applied, whether it is the law of a Member State or that of a third country (Article 2). In so doing it follows a recognised standard in conflict of laws, which prohibits discrimination against other systems of law. The Committee endorses this approach. If the circumstances of a case require that a system of law be applied, it makes no difference whether or not it is that of a Member State.

3.2   General rules on applicable law (Articles 3, 4)

3.2.1

Article 3(1) declares that in principle it is the law chosen by the parties which applies. The Committee welcomes this provision, which reflects the principle of contractual freedom, which is a basic principle of contract law and ties in with the acknowledged standard of private international law. It is broadly consistent with the provisions of Article 3(1) of the Rome Convention, which are generally felt to be appropriate. The Committee endorses this approach. However, it sees a risk that, when applying this standard in practice, courts could attempt to establish a hypothetical will of the parties without adequate evidence to support it. Such a risk should be ruled out and this point should ideally be clarified in the recitals (No 7). Article 3(3) puts such emphasis on the freedom of choice of applicable law that the parties may choose a different law at any time. Although the Committee welcomes this in principle, it feels that there is a potential threat to the protection of consumers, who might be unable to fully anticipate the consequences of such a step. The Committee suggests that such subsequent changes in the law chosen to apply to consumer contracts should — in line with the rule on agreements on the choice of jurisdiction (Article 17(1), Brussels I regulation) –only be allowed after a dispute has arisen, as the consumer will then be on the alert and will act more cautiously.

3.2.2

On the basis of the parties' agreement on the choice of courts, the third sentence of Article 3(1) presumes that they have chosen the law of the Member State in which the court is situated (unless they have explicitly chosen a different law). This provision reflects an endeavour to align forum and law. Alignment usually makes it simpler to pass judgment. However, the Committee has its doubts as to whether such strict wording of the rule would not interfere with the intention of the parties. It would be better to tone down and re-word the rule so that it simply guides interpretation of the second sentence, for example as follows:

‘In particular, this choice should take account of the court chosen by the parties.’

3.2.3

The Committee would like to discuss one aspect in greater depth, as it is of central importance for the future of the European legal area, i.e. the possible creation of an ‘optional instrument’ or 26th regime by the European Community. This would mean that the parties could opt for Community civil law, an idea which is currently under discussion. Work has begun on a Common Frame of Reference (CFR), which could represent a first step in this direction. Article 3(2) includes a clause which gives parties the option of such supranational rules. At present this possibility is not straightforward in private international law, and the Committee therefore strongly welcomes this development. This would for the first time allow parties to use European standard contracts, which to a large extent would be genuinely harmonised and would represent a significant step towards completion of the Internal Market (9).

3.2.4

Article 4(1) includes rules on the law applicable to a variety of contracts; in terms of content, these amplify the provisions of Article 4(2) of the regulation, which are taken from the Rome Convention. Under the Rome Convention, these rules could only have been derived by interpreting Article 4(2). Although the Commission's proposed rules can be seen as ensuring greater legal certainty, this happens at the price of rigidity and inflexibility, barring any exceptions even when individual circumstances may warrant them. The Committee is concerned that this is a retrograde step relative to the Rome Convention which could have negative repercussions, as cases are conceivable in which the rigid rules on the applicable law could, exceptionally, result in an inappropriate solution. In such exceptional cases, the option for judges to apply a more appropriate law might possibly lead to a more satisfactory outcome. Admittedly, if the goal of legal certainty and predictability in terms of the applicable law is to be met, such waivers cannot under any circumstance be allowed to result in judges invoking the applicable law in an arbitrary way; they will therefore have to give very careful consideration and deliver a very solidly reasoned judgement. With this in mind, the Committee suggests considering an amendment to the regulation.

3.2.5

The Committee understands what the Commission is trying to achieve in Article 4(1)(f). However, it would point out that, because of the grounds on which they are substantiated, many industrial property rights are assignable under conditions that differ from those provided for under the law of the rightholder's country of habitual residence. As Article 4(1) does not establish applicability of the law of the place of habitual residence in substantiating the legal relationship, a change in the applicable law due to a subsequent change in the rightholder's country of habitual residence would raise difficulties in such cases in relation to the legal basis of property rights. The Committee recommends that the Commission look into this problem and propose an appropriate solution.

3.3   Specific rules on applicable law (Articles 5-17)

3.3.1

The Rome Convention rules on consumer contracts have often been criticized and there have been numerous calls for their revision; Article 5 is a thorough re-working. The Committee feels that the Commission has taken a step in the right direction, as the complex application of two different sets of laws to the same case required by Article 5 of the Rome Convention will be avoided in future. There is no doubt that a consumer who signs contracts with a person who pursues a trade or profession needs protection, including in the area of conflict-of-law rules. In most cases, this is ensured by applying the law of the Member State in which the consumer has his habitual residence (Article 5(1)), as this is the law which consumers know (best), the language of which they can speak and on which it is easiest to obtain professional advice. In addition, the proposed text stipulates that the activity of the company must have been directed to or conducted in the country in which the consumer has his habitual residence. Professionals tend to prefer application of home-country rules, as this is more convenient for them; the Commission's proposal serves their interests by allowing this in other cases, in line with the Rome Convention. However, the Committee wonders whether it is really necessary to deprive the parties to consumer contracts within the meaning of paragraph 2 of any possibility of choosing applicable law. In the Committee's view, it is much more likely that consumers would also benefit from the possibility of choosing the applicable law, at least provided that certain protective measures are in place, which they — as the less experienced and weaker party to the contract — undeniably need. The Committee therefore recommends that the Commission review these provisions once again with the above in mind.

3.3.2

The provisions for employment contracts (Article 6) reflect the fact that employees are in particular need of protection. These provisions are taken from Article 6 of the Rome Convention, with additional provisions to duly reflect developments in the field of dependent employment. The addition of the words ‘or from which’ is a change arising from ECJ case law relating to Article 18 of the Brussels Convention. However, in the absence of a precise definition in the regulation itself or of clarification in the recitals, the Committee is unclear as to what constitutes ‘temporary’ work in another country (Article 6(2)(a)). It is vital to put this right, as the ‘temporary’ nature of employment is of particular relevance to the rule for determining the applicable law. Nor can this shortcoming be remedied by falling back on Article 2 of the directive on posting workers (10), as this does not contain a precise definition either. Moreover, the Committee finds it difficult to understand why a provision is needed for ‘territory subject to no national sovereignty’ (Article 6(2)(b)). Perhaps this refers to drilling platforms in international waters. This should at least be clarified in the explanatory memorandum.

3.3.3

Article 7 deals with representation in legal transactions, an area which is only partially regulated in the Rome Convention, and does not include the legal relationship between agents and third parties. Closure of this loophole is timely (Article 7(2)). It is difficult to answer the question of which law should be applied here as the interests of both agents and third parties are concerned. In cases of agents exceeding their authority or acting without authority, third parties are usually more in need of protection. The proposed text aims to strike a balance between the interests of both sides and therefore meets with the Committee's approval.

3.3.4

The issue of mandatory rules is a difficult one; where possible, the results of the choice of law by the parties should not be impeded more than absolutely necessary, and application should not be hindered by rules which are extraneous to the governing law. Article 8 is broadly consistent with Article 7(2) of the Rome Convention. The regulation takes into account relevant ECJ case law (11) in defining mandatory rules and making them applicable. For those applying the law, such cases are associated with the difficulty that there is no longer a uniform basis for assessing a case, and that non-harmonised or even contradictory rules are supposed to be applied and brought in line with one another. This is time-consuming, technically complicated and results in greater legal uncertainty. However, given the situation with regard to alignment of national laws, the Committee does not feel that there is any alternative, especially seeing that even legal theorists are overwhelmingly in favour of applying such rules in conflict-of-law cases.

3.3.5

On the whole, the remaining Articles 10–17 present few problems in the Committee's view and no detailed comments are necessary, especially when they simply take over the provisions of the Rome Convention.

3.3.6

Given the growing frequency of distance contracts, Article 10 (formal validity of the contract) meets the need for simpler rules on formal validity of contracts or unilateral acts by introducing additional rules on the applicable law.

3.3.7

Voluntary assignment and contractual subrogation of the creditor's rights from the creditor to a third party discharging the debt, which is a feature of many systems of law, serve the same purpose in economic terms (12). The proposed text does well to deal with both in Article 13. Article 13(3) introduces a new conflict-of-law rule on the question of which law should determine whether the assignment may be relied on against third parties. This rule rightly follows the solution adopted by the United Nations Convention on the assignment of receivables in international trade of 12 December 2001.

3.3.8

Article 14 includes a conflict-of-law rule for a statutory subrogation, which is a feature of most systems of law. A conflict-of-law rule is therefore necessary. Article 15 completes Article 14 with a conflict-of-law rule on joint liability of multiple debtors in the case of statutory subrogation. Although it would have made sense to combine this with Article 14 in a single rule, no change is needed here.

3.4   Other provisions/final provisions (Articles 18 — 24)

3.4.1

The matters dealt with in Chapters III and IV are predominantly technical rules consistent with general standards in conflict of laws and require no detailed comment. This applies in particular to Article 19 (Exclusion of renvoi), which is consistent with Article 15 of the Rome Convention, Article 21 (States with more than one legal system), which is consistent with Article 19 of the Rome Convention, Article 20 (Public policy), which is consistent with Article 16 of the Rome Convention and Article 23 (Relationship with existing international conventions), which is consistent with Article 21 of the Rome Convention.

3.4.2

The habitual place of residence (Article 18) of a person plays a central role in current private international law when determining the applicable law. Although determining the habitual place of residence of a natural person is unproblematic, doubts may arise in relation to legal persons. The regulation disposes of such doubts in an appropriate way by declaring the main place of business to be the decisive criterion. It would not have been appropriate to model this provision on Article 60 of Council Regulation (EC) No 44/2001, as this regulation generally takes the place of permanent residence rather than that of habitual residence as the criterion, and also as the threefold solution adopted there would have meant less legal certainty.

3.4.3

Sub-paragraph (c) of Article 22 is difficult to understand. What it seems to be stipulating is that Community legal acts adopted at a later stage may include conflict-of-law rules of their own, which could override application of the regulation. However, existing achievements in harmonising private international law should be preserved in future. Dispersal of legal sources with substantively divergent rules is to be avoided. If the need for special rules should arise in future, they should be integrated into the regulation.

The Committee suggests deleting sub-paragraph (c).

3.5   Annex I

3.5.1

The third and fourth items listed in the Annex are the ‘second non-life insurance Directive’ and the ‘second life assurance Directive’. Apart from the fact that the latter directive has been repealed and that presumably the intended reference is to the life assurance Directive (13) which replaced it, both of these bullet points cause problems, although the Committee would not go so far as to call for their deletion. However, it would definitely draw the Commission's attention to the major problems to which the proposal gives rise. A golden opportunity to simplify and harmonise conflict-of-law rules and to solve problems in the relevant area is being squandered as a result. Used in conjunction with Article 22 (a), the third and fourth bullet points of Annex I would mean that the regulation could not be applied to conflict of laws on direct insurance contracts (14) covering risks located within the EU, as this is regulated by these two directives.

3.5.2

However, conflict-of-law rules on insurance contracts covering risks located outside the EU, on insurance of risks inside the EU (although only if contracts are concluded with a non-EU insurance company) and on re-insurance contracts are very much within the scope of the regulation. This would perpetuate a situation which has already led to confusion on the part of those applying the law (15). Since enactment of the insurance directives, the conflict-of-law rules for insurance contracts differ from general conflict-of-law rules for contracts (Article 1(3) of the Rome Convention), even though insurance contracts also entail contractual obligations. There were no objective reasons for drawing this distinction, other than that at the time of concluding the Rome Convention work had not yet begun on the second generation of insurance directives, and it was decided to wait and see what kind of regulatory framework would emerge before determining the conflict-of-law rules (16). However, this reason no longer applies.

3.5.3

Private international law rules were at odds with the directives, which are influenced by regulatory law. Without specialist knowledge, lawyers applying the law would not expect to find them. The division between various cross-cutting and sector-specific legal sources complicates private international law on insurance. For the sake of legal consistency, a comprehensive approach superseding special rules would be desirable.

3.5.4

There is no point in incorporating the private international law of the directives in the Rome I regulation without substantive changes, as it would maintain different rules for insurance contracts with risks located inside and outside the EU without good reason. This cannot be justified by reference to regulatory law. Insurance companies are regulated according to the country of establishment principle, which in any case tends to lead to a discrepancy between regulation and risk location for cross-border operations. The situation for insurance contracts covering risks inside and outside the EU is not the same. It makes sense to bring insurance contracts covering risks located inside the EU within the scope of the regulation's general rules on applicable laws. Due to the introduction of rules on the choice of law by the regulation, the insurance sector and its clients in the non-consumer segment would in future benefit from enhanced choice-of-law options. An intelligent choice of law from the contract law perspective would make it possible to offer identical products throughout Europe, obviating much of the necessity to develop separate products. In the past, problems in this area have deterred insurance companies from making much use of the freedom to provide services for anything less than coverage of major risks. In terms of choice of law, only consumers are in general need of protection, including in the area of insurance. Compared to them, businesses and the self-employed enjoy a lesser degree of protection, but do not have full freedom in choice of law, and do not require any special protection. They have sufficient business experience to understand the risks which they are taking in operating outside their home country's system of law or to recognise when they need legal advice.

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  Rome Convention on the law applicable to contractual obligations, 19 June 1980. Current version: OJ C 27, 26.1.1998, p. 36.

(2)  COM(2006) 83 final, 2003/0168 (COD).

(3)  COM (2002) 654 final.

(4)  Opinion of the European Economic and Social Committee on the Green Paper on the conversion of the Rome Convention of 1980 on the law applicable to contractual obligations into a Community instrument and its modernisation. INT/176, 29.01.2004.

(5)  European Parliament Resolution on the prospects for approximating civil procedural law in the European Union (COM(2002) 654 — COM(2002) 746 — C5-0201/2003 — 2003/2087(INI)), A5-0041/2004.

(6)  The following examples should be mentioned:

 

the adoption of the 1968 Brussels Convention in the form of a regulation; Council Regulation (EC) No 2001/44 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, OJ L 12, 16.1.2001, p. 1, and the EESC opinion on the subject, OJ C 117, 26.4.2000, p. 6 (rapporteur: Mr Malosse),

 

the Regulation creating a European enforcement order for uncontested claims, Regulation (EC) No 805/2004 of the European Parliament and of the Council of 21 April 2004 creating a European Enforcement Order for uncontested claims, OJ L 143, 30.4.2004, p. 15, and the EESC opinion on the subject, OJ C 85, 8.4.2003, p. 1 (rapporteur: Mr Ravoet),

 

the Regulation on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters, Council Regulation (EC) No. 1348/2000 of 29 May 2000 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters, OJ L 160, 30.6.2000, p. 37, and the EESC opinion on the subject, OJ C 368, 20.12.1999, p. 47 (rapporteur: Mr Hernández Bataller),

 

the Council Regulation on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters, Council Regulation (EC) No. 1206/2001 of 28 May 2001 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters, OJ L 174, 27.6.2001, p. 1, and the EESC opinion on the subject, OJ C 139, 11.5.2001, p. 10 (rapporteur: Mr Hernández Bataller),

 

Council Regulation (EC) No 1346/2000 of 29 May 2000 on insolvency procedures, Council Regulation (EC) No 1346/2002 of 29 May 2000 on insolvency procedures, OJ L 160, 30.6.2000, p. 1, and the EESC opinion on the subject, OJ C 75, 15.3.2000, p. 1 (rapporteur: Mr Ravoet),

 

the Consumer Credit Directive, (COM(2002) 443 final of 11.9.2002). See the EESC opinion on the subject, OJ C 234, 30.9.2003, p. 1 (rapporteur: Mr Pegado Liz),

 

the Council Directive on unfair terms in consumer contracts, OJ L 95, 21.4.1993, p. 29.and the EESC opinion on the subject, OJ No C 159, 17.6.1991, p. 35 (rapporteur: Mr Hilkens),

 

Green Paper on a European order for payment procedure and on measures to simplify and speed up small claims litigation (COM(2002) 746 final), and the EESC opinion on the subject, OJ C 220, 16.09.2003, p. 5, (rapporteur: Dr von Fürstenwerth),

 

Proposal for a Regulation of the European Parliament and of the Council creating a European order for payment procedure, and the EESC opinion on the subject, OJ C 221, 8.9.2006 (rapporteur: Mr Pegado Liz).

(7)  Cf. the various Hague Conventions, for example the Convention relating to the settlement of the conflict of the laws concerning marriage of 12.6.1902, the Convention on the law applicable to maintenance obligations towards children of 24.10.1956, the Convention on the law applicable to maintenance obligations of 2.10.1973, etc.

(8)  The Geneva Convention providing a uniform law for bills of exchange and promissory notes of 7 June 1930 and the Geneva Convention providing a uniform law for cheques of 19 March 1931.

(9)  If an optional instrument/26th regime ever comes into being, this would then claim to be the best of all possible systems of civil law. If it were agreed to apply this instrument rather than a national system of law, there would logically no longer be any need to align it with national laws or allow interference on the grounds of national mandatory rules (or even public policy considerations — Article 20). Instead, choice of the optional instrument would lead to a fully unrestricted application of this set of rules, as it would represent the generally acknowledged standard in the EU. As Article 3(2) already allows in principle for the choice of such an instrument, this would also be the logical place to create the conditions enabling the benefits of the optional instrument to be put into practice. It should be explicitly stated that Article 8 is without effect if it is agreed to apply a supranational system of law (the same applies to public policy — Article 20).

(10)  Directive 96/71/EC of the European Parliament and of the Council of 16 December 1996 concerning the posting of workers in the framework of the provision of services (OJ. L 18, 21.1.1997, p. 1).

(11)  Cases C-369/96 and C-374/96 of 23.11.1999.

(12)  Note: this is only clear from the French language version of the proposal; incomprehensibly, in the German language version it has not been translated, as German law lacks an equivalent legal instrument. However, for the sake of completeness it should at least be paraphrased.

(13)  Directive 2002/83/EC of the European Parliament and of the Council of 5 November 2002 concerning life assurance, OJ. L 345, 19.12.2002, 1.

(14)  In distinction to re-insurance contracts.

(15)  At present, the situation is as follows: according to Article 1(3) of the Rome Convention, insurance contracts are excluded from the scope of the Convention, provided that they are direct insurance contracts, but only if the risk is located in the EU. When this happens cannot be deduced from the Rome Convention itself, but from the insurance directives. However, the Rome Convention applies to re-insurance contracts and to risks located outside the EU.

(16)  Giuliano/Lagarde, Rome Convention on the law applicable to contractual obligations, OJ C 282, 31.10.1980, p. 13.


23.12.2006   

EN

Official Journal of the European Union

C 318/62


Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council on type approval of motor vehicles with respect to emissions and on access to vehicle repair information, amending Directive 72/306/EEC and Directive …/…/EC

[COM(2005) 683 final — 2005/0282 (COD)]

(2006/C 318/11)

On 31 January 2006 the Council decided to consult the European Economic and Social Committee, under Article 95 of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 12 July 2006. The rapporteur was Mr Ranocchiari.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 13 September), the European Economic and Social Committee adopted the following opinion by 180 votes to three, with 11 abstentions.

1.   Conclusions and recommendations

1.1

The EESC agrees that it was necessary to promote the continued improvement of car emission levels by means of legislation, gradually introducing increasingly ambitious objectives. It therefore welcomes the Commission's proposal, which marks a further step in this direction.

1.2

The EESC also endorses the Commission's decision to opt for a regulation rather than a directive and its choice of legislative procedure, which provides for a co-decision-based regulation, supplemented by a comitology-procedure regulation for the more technical aspects, drawn up with the assistance of a regulatory committee.

1.3

The Committee must nevertheless point out that the draft regulation in its current form poses considerable problems for the industry and for the Member State government departments responsible for vehicle type approval and registration.

1.3.1

In particular the EESC recommends changing the dates of entry into force of the new rules contained in the proposed regulation to 1 January 2010 (for the type approval of new types of car) and 1 January 2011 (for new registrations) or, alternatively, 36 months and 48 months after the publication of the new regulations in the EU Official Journal. The EESC also recommends maintaining a further period of one year for class II and III N1 vehicles (1).

1.3.2

The EESC agrees with the limits proposed for vehicles with diesel engines. It has doubts, however, as to the need to further tighten the limits for vehicles with engines running on petrol or gaseous fuels.

1.3.3

The EESC believes that the exemption enabling certain M1 passenger vehicles (2) that perform specific functions or are used for work (e.g. minibuses) to be approved in accordance with the limits laid down for light commercial vehicles (N1) should be preserved. It therefore asks the Commission to provide a more precise and restricted definition for such vehicles than that given in the current directive.

1.3.4

The EESC recommends that the proposed regulation not contain rules that would be better covered by other regulations or directives already in force.

1.3.5

Lastly, the EESC asks the Commission to revise those points in the proposed text that could give rise to administrative uncertainties, by making full use of the support of national experts who deal with problems relating to the type approval and registration of motor vehicles on a day to day basis.

2.   Reasons and legislative context

2.1

Until now, emissions from cars (M1 vehicles) and light commercial vehicles (N1 vehicles) have been regulated by Directive 70/220/EEC and subsequent amendments. The most recent updates, commonly referred to as Euro 4 (3), came into force on 1 January 2005 (new vehicle types) and 1 January 2006 (new registrations) respectively.

2.2

The present proposal provides for a tightening of the rules on motor vehicle emissions, by adopting a regulation to replace the current directive. The reason for this choice of legal instrument is that the regulation and thus its objectives will be directly applicable in the Member States without having to be transposed into national law as would have been the case for a directive. The existing directives are repealed.

2.3

The Commission proposes a two-pronged legislative approach:

a)

a regulation of the European Parliament and the Council, defining general principles, will be approved by means of the co-decision procedure (‘co-decision proposal’);

b)

a regulation defining technical specifications will be adopted by the Commission with the assistance of the Committee on adaptation to technical progress (‘comitology proposal’).

2.4

In addition, an economic impact assessment of the proposed regulation has been published, including estimates of the costs of the measures to be taken to bring vehicles into conformity with the reduced emission levels planned.

3.   Content of the proposal

3.1

The draft regulation, referred to in Community jargon as ‘Euro 5’, applies to cars and light commercial vehicles fuelled by petrol, natural gas, LPG and diesel. It establishes limit values for emissions of pollutants originally considered by the Commission to be a priority, such as particulate matter (PM), nitrogen oxides (NOx), carbon monoxide (CO) and hydrocarbons (HC).

3.2

More specifically, the proposal imposes the following restrictions on the tailpipe emissions of positive ignition (petrol and gaseous fuels) and diesel vehicles:

A 25 % reduction in NOx and HC is proposed for engines fuelled by petrol and gaseous fuels.

An 80 % reduction in particulate emissions is proposed for engines fuelled by diesel, requiring the installation of diesel particulate filters (DPF). A 20 % reduction in NOx emissions is also planned.

The Commission supplements its proposals on tailpipe emission limits with rules on the durability of emission testing systems, in-use compliance checks, on-board diagnostics (OBD), evaporative emissions, idling speed emissions, crankcase emissions, smoke opacity, and fuel consumption measurement.

3.3

Lastly, the Commission provides for measures relating to access to vehicle repair information for operators working outside the network of authorised dealers. It is proposed that this information should be more accessible via web sites, in a standardised format developed by an international technical committee (OASIS standard (4)).

3.4

The Commission proposes that the regulation should take effect:

as of 18 months and 36 months after publication in the EU Official Journal for new models and for all newly registered vehicles (class I passenger cars and light commercial vehicles) respectively,

as of 30 months and 48 months for new models and for all newly registered vehicles (class II and III light commercial vehicles) respectively,

this would mean the possible introduction of the proposed new standards for passenger vehicles as of the first half of 2008.

4.   General comments

4.1

The EESC welcomes the Commission's decision to opt for a regulation rather than a directive. As a result, as it is not necessary to transpose the regulation into national law, it will become immediately and simultaneously applicable in all the Member States.

4.2

The EESC endorses the new two-stream legislative procedure, while stressing the need for the two regulations — one the product of co-decision, the other of comitology — to be published in the Official Journal simultaneously. The industry needs both pieces of legislation in order to complete the engineering of technical devices to meet the new standards.

4.3

The EESC welcomes the plan to introduce tighter limits on diesel emissions.

4.4

The EESC recognises that technology to reduce the particulate (PM) emissions of vehicles with diesel engines is now available and that the proposed limit values will require its generalised use.

4.5

The Committee does, however, have considerable concerns regarding the proposed regulation's economic impact assessment:

first, in striking contrast to the working methods of the CAFE programme (5) (Clean Air for Europe), none of the results obtained by the models used for assessing the cost-benefit ratios of the measures to be taken in the various sectors causing air pollution have been made available in the way suggested by CARS 21 (6);

the economic impact assessment refers only to the additional costs generated by the entry into force of the new limits on car emissions and the corresponding reduction in pollutants emitted in tonnes/year. It does not therefore allow for any comparative assessment of the cost-benefit of measures that could be implemented in other sectors, using the CAFE models;

the figures for the ‘Euro 5’ scenario proposed by the Regulation, which were estimated by the group of independent experts (7) chosen by DG Enterprise for that purpose, have been cut by 33 % to take into account the economies of scale arising from the increased volume of production, without any explanation for the choice of percentage (8);

more specifically, the group of independent experts' estimates of the cost of measures to be taken on vehicles to bring them into line with the various emission-reducing scenarios already include a 30 % reduction in the price of precious metals. Precious metals are one of the key elements in post-processing systems for exhaust gases and their market value has a major influence on the cost of such systems. The above hypothesis is not justified by the fact that over the last five years the price of platinum has risen steadily.

4.6

The EESC also has concerns regarding the dates of implementation of the regulation:

the 18-month period following the entry into force of the new regulation is not sufficient, as it takes at least three years to bring into production a known technology that has not yet been applied to specific models,

the draft regulation should either confirm 1 January 2010 as the date of entry into force of the new requirements for the approval of new types of vehicle or impose a 36-month period from the date the regulation is published, subject to clarification of the limit values and testing protocols,

the industry has planned, in agreement with its suppliers, to introduce the Euro 5 standards by 2010/2011, as was clearly indicated in the Commission's communication on fiscal incentives in January 2005 (9). Changes to the various models and related production processes have already been planned, the deadline for introducing Euro 5 is already very tight and the timetable cannot therefore be made any tighter.

4.7

Lastly, in Article 5(4) the Commission sets specific requirements for type approval, without providing any further guidelines or instructions. The EESC is concerned that the absence of such instructions makes it impossible to assess the real impact of the proposal on vehicle engineering and the environment.

5.   Specific comments

5.1

In Annex 1, Table 1 of the draft regulation, Euro 5 limit values are given for HC and NOx emissions from positive ignition petrol-fuelled vehicles. There is a 25 % reduction, taking HCs to 75mg/km and NOx to 60mg/km. However, there is no justification for this reduction of the Euro 4 limit values in the results obtained by the Auto Oil II programme on air quality, and neither the CAFE analysis nor the Thematic Strategy on Air Pollution document (10) envisages an NOx or HC level reduction scenario for these vehicles.

5.2

As far as the CAFE results are concerned, the EESC concludes that in terms of benefits to air quality there is no clear justification for the measures set out in the draft regulation as regards:

NOx limit values: the proposed reduction would place an additional obstacle in the way of cutting fuel consumption and thus CO2 emissions from petrol-fuelled cars, which is the greatest challenge facing industry today. Meanwhile, the environmental benefits would be completely negligible given that, according to CAFE data, petrol-fuelled vehicles account for only 4 % of total NOx emissions from vehicle transport (11);

HC limit values: the new limit proposed would prove an insurmountable obstacle to vehicles that run on natural gas, which offer considerable environmental benefits. 90 % of these vehicles' HC emissions consist of methane, a gas that is well-known for being stable and non-pollutive and is also void of aromatic hydrocarbons; the CO2 emissions of these vehicles are 20-25 % lower than those of petrol fuelled vehicles. If the 25 % reduction in HC fuels introduced by the regulation were to be confirmed, it would no longer be possible to produce and market natural gas-run vehicles, which would have a negative impact on CO2 emissions. This would also run counter to the substitution objectives set by the Commission in its communication on alternative fuels (12).

5.3

The Commission proposal does away with the exemption enabling M1 passenger vehicles with a weight of over 2.5 tonnes (but under 3.5 tonnes) to be type approved in line with the limits for light commercial vehicles (N1).

5.3.1

The EESC believes that a distinction should be drawn between heavy vehicles designed to perform specific tasks and those often bought as a fashion statement and for mounting kerbstones in big cities. Examples of the former include:

vehicles designed to carry seven or more passengers: these vehicles perform a local transport function (e.g. minibuses, shuttles, campervans and vehicles designed for specific purposes, such as ambulances). The ability to seat a large number of passengers and the greater load-carrying capacity imply the design of a heavier, taller and wider vehicle with a specific gear box and thus slightly higher emissions;

off-road vehicles, with a maximum weight of over 2.5 tonnes: these vehicles are essential work tools for rural communities, as well as for the emergency services and public utility organisations, and have many other important functions, including military purposes. For this reason, their specific needs are taken into consideration by various legislative systems and they should continue to benefit from special treatment;

production volumes in these two market segments are extremely small and their emissions account for a negligible share of total motor-vehicle emissions. Their impact on air quality is therefore negligible providing the rules for light commercial vehicles are applied.

5.3.2

The EESC does not agree with the Commission that the conditions no longer apply to justify M1 category vehicles weighing over 2.5 tonnes being type approved within the limits intended for light commercial vehicles. The Committee does however accept the need to define more clearly which vehicles can benefit from the exemption.

5.3.3

The indiscriminate removal of the exemption for all heavy M1 vehicles would lead to a switch to petrol engines, with a corresponding increase in fuel consumption and thus CO2 emissions.

5.4

The EESC agrees with the Commission that access to vehicle repair information and effective competition in the market for vehicle repair and information services are necessary to facilitate the free movement of vehicles in the internal market. This has been confirmed in Regulation 1400/2002/EC on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices in the motor vehicle sector as well as in Directives 98/69/EC and 2002/80/EC and elsewhere.

5.4.1

Nevertheless, the EESC would point out that it is necessary to provide unrestricted and standardised access to vehicle repair information, since, in practice, vehicle manufacturers tend to spread this information across different media and documentation structures. It causes considerable barriers to independent multi-brand aftermarket operators, especially small enterprises that predominate on the independent repair market in the EU. Therefore, the EESC supports the Commission proposal to include in the regulation a requirement that vehicle repair information also be available through websites in a standardised format.

6.   Comments and specific recommendations

6.1

The draft regulation makes a number of references to future Directive XXX/XX/EC. As this directive will modify the Framework Directive on type approval, it would be preferable to indicate clearly that the reference is to the ‘Framework Directive on type approval 70/156/EEC, as modified by Directive XXXX/XX/CE’.

6.2

The 13th recital introduces the requirements for a standardised method of measuring fuel consumption and for customers and users to have access to objective and precise information. However, these are already binding requirements under Directive 1999/94/EC and it is therefore quite unnecessary to mention them again.

6.3

The EESC would point out that the text of Article 2(1), Article 4(1) and Article 5 of the draft regulation is unclear. More specifically:

6.3.1

Article 2(1) lists the motor vehicles concerned by the regulation. Article 4(1) and Article 5 then appear to require that all vehicle models covered by the regulation (i.e. those listed in Article 2) comply with the following long list of requirements: tailpipe emissions; low ambient temperature emissions; evaporative emissions; on-board diagnostic (OBD) systems; durability and anti-pollution devices; emissions at idling speed; crankcase emissions; CO2 emissions and fuel consumption; smoke opacity.

6.3.2

The above would however involve an unjustified increase in the number of tests to be conducted at the type approval stage. For instance, measuring emissions at idling speed or evaporative emissions for a diesel vehicle is totally unnecessary. It would be less ambiguous and more appropriate to use the table proposed in Directive 70/220/EEC (13), Annex I, Figure 1.5.2.

6.4

The EESC would point out lastly that the scope of the regulation is not clear in the case of category M vehicles (passenger vehicles) with positive ignition engines, with the exception of those running on NG and LPG. Articles 4 and 5 of the regulation seem to extend the entire set of requirements to M2 and M3 category vehicles, whereas, in the past, M vehicles weighing more than 3.5 tonnes (which are extremely rare in Europe) had only to comply with requirements on idling speed and crankcase emissions.

6.5

Article 4(3) underlines the manufacturer's obligation to provide the buyer with technical information on vehicle emissions and consumption. As this obligation is already laid down in Directive 1999/94/EC, as modified by Directive 2003/77/EC, this paragraph is redundant.

6.6

Article 10 deals with the type approval of non-original replacement components. It bans the sale and installation of replacement catalytic converters unless they are of a type that has been approved within the meaning of the regulation. It is not clear whether the Commission intends to limit the use of such converters to vehicles registered before 1992 (and thus to pre-OBD vehicles), ruling them out for more recent vehicles. Furthermore, the need for type approval should be extended to any other non-original components of emission control systems, such as particulate filters.

6.7

Article 11(2) authorises Member States to introduce financial incentives for the installation of retrofit systems (14) that bring the tailpipe emissions of in-use vehicles into line with the limits set by the regulation. The Commission does not however state which procedures should be used to demonstrate that these systems conform with requirements, nor does it state whether such procedures are already available.

6.8

Article 17 gives a list of Directives (15) that will be repealed 18 months after the date of entry into force of the regulation. This gives rise to the following comments:

if the Commission intended to include all the Directives that amend Directive 70/220/EEC on vehicle emissions and Directive 80/1268/EEC on fuel consumption, the list is incomplete (e.g. Directive 70/220/EEC has undergone 18 modifications, but only six of those are mentioned). A simpler approach might be to use the following wording: ‘Directive 70/220/EEC, as most recently modified by Directive 2003/76/EC, and Directive 80/1268/EEC, as most recently modified by Directive 2004/3/EC, are repealed with effect from …’.

6.8.1

The proposed repeal of the above-mentioned directives on vehicle emissions and fuel consumption 18 months after the entry into force of the regulation raises some serious problems.

6.8.2

This date would in fact coincide with the date for the entry into force of type approval standards, albeit only for new M1 vehicles introduced by the manufacturer. M1 models already type approved before that date may still be registered for a further 18 months, without a further type approval being required. Similar conditions apply for class II and III N1 vehicles: new models have a further 12 months to be type approved, whereas those that have already been type approved and have still to be registered are granted a further 30 months.

6.8.3

The problem lies in understanding how the certificate of conformity required at registration can be issued if it necessarily refers to a repealed directive.

Brussels, 13 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  Category N vehicles are goods vehicles with at least four wheels. They are divided into three classes: N1, N2 and N3, on the basis of maximum weight: N1< 3 500kg; N2< 12 000kg; N3>12 000kg. The N1 class is also subdivided into 3 subclasses: NI, NII and NIII, also on the basis of weight.

(2)  Category M covers passenger vehicles with at least four wheels. They are divided into three classes (M1, M2, M3) based on the number of seats and their maximum weight: M1< 9 seats; M2> 9 seats and < 5 000kg; M2> 9 seats and < 5 000kg.

(3)  OJ L 350 of 28.12.1998, Directive 1998/69/EC.

(4)  OASIS, Organisation for the Advancement of Structured Information Standards.

(5)  CAFE — Clean Air for Europe. This programme was launched by Communication COM(2001)245. It is designed to develop an analytical strategy for assessing directives on air quality, the effectiveness of programmes running in the Member States, ongoing monitoring of air quality and the dissemination of information to the public, the revision and updating of emissions limits and the development of new monitoring and modelling systems.

(6)  CARS 21 — Competitive Automotive Regulatory System for the 21st Century. This is a group of experts made up of representatives of the Commission, the European Parliament, the Member States, industry, trade unions, NGOs and consumers. Its task is to make recommendations for improving the competitiveness of the European automobile industry, while giving consideration to the relevant socio-environmental aspects.

(7)  At the meeting of the Motor Vehicle Emissions Group (December 2005), DG Enterprise handed out the document produced by the group of independent experts, which set out the results of the analysis carried out on the technology/cost ratio for vehicles falling within Euro 5.

(8)  SEC(2005) 1745, Impact Assessment for the present draft regulation, §6.2. Scenarios of the Regulatory Approach, Table 1 — Scenario G, p. 13.

(9)  SEC(2005) 43, Commission Staff Working Paper, Fiscal incentives for motor vehicles in advance of Euro 5.

(10)  COM(2005) 446 final.

(11)  Information available on the IISA, International Institute for Applied Systems Analysis, website.

(12)  COM(2001) 547 final, whose objective for replacing traditional fuels with natural gas was set at 5 % by 2015 and 10 % by 2020.

(13)  This table identifies the tests to be carried out by vehicle type.

(14)  The term retrofit means the installation of a mechanism on a vehicle that is already in use in order to further restrict emissions.

(15)  Directive 70/220/EEC, Directive 80/1268/EEC, Directive 89/458/EEC, Directive 91/441/EEC, Directive 93/59/EEC, Directive 94/12/EC, Directive 96/69/EC and Directive 2004/3/EC.


23.12.2006   

EN

Official Journal of the European Union

C 318/67


Opinion of the European Economic and Social Committee on Social tourism in Europe

(2006/C 318/12)

On 19 January 2006, the European Economic and Social Committee, under Rule 29(2) of its Rules of Procedure, decided to draw up an opinion on: Social tourism in Europe.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 26 July 2006. The rapporteur was Mr Mendoza Castro.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 14 September), the European Economic and Social Committee adopted the following opinion by 138 votes to two, with four abstentions.

A.   PART ONE: ANALYSIS OF CURRENT SITUATION

1.   Introduction

1.1

To tie in with the various opinions it has been drawing up as a contribution to the framing of a European tourism policy, the European Economic and Social Committee has decided to draft an opinion on social tourism, analysing its origins, development and current situation in Europe, the experiences of different Member States and the values it represents. In particular, the opinion will make recommendations aimed at public and private institutions with a view to enhancing social tourism in Europe and making it accessible to all. This opinion also contributes to the current debate on European tourism policy by looking at social tourism as an integral part of the European tourism model.

1.2

Tourism in Europe: state of play and future challenges. There have been various studies, reports and opinions discussing the situation of tourism from a wide range of angles: the economic, social and environmental aspects; the high importance of tourism in the European and various national economies; its positive contribution to wealth and employment in Europe. All of these factors combine to create a picture of strong potential, stability and growth. However, it is also pointed out that tourism brings with it various internal and external problems and threats in the short, medium or long term: seasonality, the use or abuse of natural resources, poor appreciation of cultural heritage and the local environment, and concerns over terrorism affecting the safety of local people and tourists. These factors mean that tourism raises some major challenges that will need to be addressed if it is to follow the path of sustainable development. These challenges include the accessibility of tourism to all, its real contribution to the development of many undeveloped countries around the world, environmental sustainability, respect for the Code of Ethics for Tourism, job stability and quality, and a contribution to world peace. For such a strategic industry as tourism in Europe, these challenges — and many others — are a necessary step towards a better quality of life for all.

1.3

Tourism policy in the European Union. On 6 April 2005, the European Economic and Social Committee adopted an opinion on Tourism policy in the enlarged European Union , which analysed in detail both current tourism policy, in the light of the Constitutional Treaty, and the repercussions of the present and future enlargement. The opinion welcomes the role of tourism as supporting, coordinating and complementary to other European policies. For example, tourism has strong links with employment and social policy, the improvement of quality, technological research and development, consumer protection, environmental policy and other very diverse policies. In particular it should be pointed out that the present opinion aims to pinpoint and analyse the contribution of social tourism to employment and social policies. The EESC, in the context of various opinions on tourism, is promoting European policies that focus on creating a European tourism model based not necessarily on legislation but on values. Social tourism and the values associated with it could form a key part of this model, and help to establish and disseminate it.

1.4

The challenge of the Lisbon agenda and social tourism. Attention should be given to the challenge that the Lisbon agenda raises for tourism, especially social tourism. As the strategic objective of the agenda is to make Europe ‘ the most competitive and dynamic knowledge-based economy in the world, capable of sustained growth, growth providing more and better jobs and greater social cohesion ’, it will be necessary to analyse whether social tourism contributes effectively and positively to this goal, how it achieves this, and how its contribution could be enhanced. As will be explained in the course of this opinion, the EESC believes that while this contribution is real, it could be strengthened. Measures will therefore be proposed for the various players involved in social tourism.

1.5

Background to the opinion. There is a wide variety of background material to this opinion, both in terms of theory (studies, reports, journals) and practice (actual examples of social tourism initiatives in Europe). There have been a great many contributions from public and private institutions; among these, it is worth mentioning the EESC's opinion of 29 October 2003 on Socially sustainable tourism for everyone which includes social tourism among 100 initiatives (point 5.5.2); also worth citing is the opinion of 6 April 2005 on Tourism policy in the enlarged EU , which includes the European social tourism project as a potential pilot project for European institutional cooperation.

2.   The concept of social tourism

2.1

The right to tourism as a keystone of social tourism. Everyone has the right to rest on a daily, weekly and yearly basis, and the right to the leisure time that enables them to develop every aspect of their personality and their social integration. Clearly, everyone is entitled to exercise this right to personal development. The right to tourism is a concrete expression of this general right, and social tourism is underpinned by the desire to ensure that it is universally accessible in practice. Thus social tourism is not marginal or extraneous to tourism in general, which is a major industry in the world, in Europe as a whole and in various Member States in particular; on the contrary, it is a way of putting into practice this universal right to participate in tourism, to travel, to get to know other regions and countries — the very foundation of tourism. It should be highlighted that this right is enshrined in Article 7 of the Global Code of Ethics for Tourism approved by the World Tourism Organization in Santiago de Chile on 1 October 1999 and adopted by the United Nations on 21 December 2001.

2.2

Definition of social tourism. There are many ideas about what social tourism really is, making it difficult to define the concept precisely. While the various institutions that have covered the topic use widely differing methods (such as the identification of content, expected results, aims, ideas and beliefs), they always base themselves on one tenet: everybody, including the least privileged, has the right to rest, relaxation and time off from work on a daily, weekly and yearly basis. According to the International Bureau of Social Tourism (BITS), social tourism is ‘all the concepts and phenomena resulting from the participation in tourism of low-income sectors of the population, made possible through well defined social measures’. BITS is currently in the process of revising this definition, expanding it to include the contribution tourism makes to development and solidarity.

2.2.1

According to the European Commission (1), ‘social tourism is organised in some countries by associations, cooperatives and trade unions and is designed to make travel accessible to thehighest number of people, particularly the most underprivileged sectors of the population’. This already dated definition is being revised in the wake of the technical meetings held in recent years. The EESC does not believe that either definition is precise enough; however, as is often the case in the social sciences, an exact definition is less important than the identification of specific features.

2.2.2

Consequently — and without any intention of giving a precise definition of social tourism, but starting from the premise that tourism is a general right which we should try to make accessible to everyone — we can say that an activity constitutes social tourism whenever three conditions are met:

Real-life circumstances are such that it is totally or partially impossible to fully exercise the right to tourism. This may be due to economic conditions, physical or mental disability, personal or family isolation, reduced mobility, geographical difficulties, and a wide variety of causes which ultimately constitute a real obstacle.

Someone — be it a public or private institution, a company, a trade union, or simply an organised group of people — decides to take action to overcome or reduce the obstacle which prevents a person from exercising their right to tourism.

This action is effective and actually helps a group of people to participate in tourism in a manner which respects the values of sustainability, accessibility and solidarity.

2.2.3

Ultimately, just as tourism in general is an integrated activity involving various sectors, branches of activity and spheres of development, social tourism subsumes all those initiatives which make tourism accessible to persons with special needs, at the same time generating social and economic benefits for various sectors, activities and groups.

2.3

History of social tourism

Although the emergence of social tourism activities as we know them today is not clear, they may have originated in the organisations that specialised in holidays based on physical exercise in the mountains, which arose at the beginning of the 20th century, or the holiday camps for children from underprivileged families that emerged in Switzerland and France.

The public authorities began to get involved in the early forms of social tourism after the Second World War. This involvement was connected with workers' movements, with some European countries (France, Italy, Portugal and Spain) organising social tourism activities, while others (UK, Netherlands) simply adopted a non-interventionist attitude.

It was in the 50s and 60s that efforts to promote social tourism really took off and many organisations, associations and coordinating bodies emerged, including the Brussels-based International Bureau of Social Tourism (BITS), which still carries out extensive promotional and representative work today.

2.4

Basics of social tourism. According to BITS, social tourism is based on five criteria:

2.4.1

The right of the majority to enjoy tourism. It is perhaps the desire to make this right a reality that justifies and underpins most strongly the various social tourism initiatives. The number of people who today benefit from a period of holiday has grown considerably as a result of the spread of tourism throughout society, but there are still many groups which, for various reasons, have no access to holidays. Lack of funds is the most common factor preventing this right from becoming universal. It is unlikely that the public authorities could or would use public funds to guarantee the right to tourism or holidays. Different countries respond to the issue in a variety of ways: some are more committed for social reasons, while others are less proactive in addressing a situation which prevents holidays from becoming accessible to all. It is important to stress that social tourism can or should in no way be equated with tourism of an inferior quality or type; quite the contrary, the hallmark of social tourism activities must be the greatest concern for overall quality as regards both facilities and service.

2.4.2

The contribution of social tourism to social integration. Tourism is a powerful driver of social integration, fostering contact with other cultures, places, customs and, especially, people: without travel, holidays and tourism, it would be impossible for people to meet, talk and acknowledge one another as fundamentally equal, yet culturally different. This cultural exchange and enjoyment of leisure time is an important means of personal development, both for tourists and for those who receive them in their local environment. The cultural exchange generated by tourism is especially valuable for young people, enhancing their intellectual development and enriching their view of the world. In the EU's case, social tourism could be effective in helping to build the Citizens' Europe. It is important to stress that the general opinion is that social tourism holidays should not be differentiated from tourist holidays in general, but should help with social integration. General tourist holidays should provide social tourism groups with suitable conditions for enjoying their holiday and not the other way round. Clearly this implies that an effort has to be made not only as regards facilities, but also the type of service and hence the special training that workers in the sector should receive.

2.4.3

Creation of sustainable tourism structures. In reality, infrastructures in tourist destinations and areas cannot always be called sustainable, particularly since tourism has often developed under conditions of short-term profitability, abuse of natural resources and occupation of the best areas — usually coasts and mountains. Social tourism, which focuses more on the social conditions than the economic aspects, can help to build or rehabilitate tourist destinations while meeting economic, social and environmental sustainability criteria. The way in which the various kinds of social tourism are managed is a key factor in the sustainability of tourist destinations and areas. If sustainability is, essentially, the balance between various aspects of human activity, then social tourism is a sustainable development tool for many less developed countries which see tourism as a source of economic activity that can lift them out of poverty.

2.4.4

Contribution to employment and economic development. Tourism is possibly already and will certainly one day become the most powerful global industry, and one of the greatest contributors to employment, development, wealth and quality of life in its beneficiaries. While social tourism contributes to this economic strength, it is not yet sufficiently aware of its own power, its economic importance and, indeed, its ability to make the choice of destinations conditional on sustainability. Social tourism companies and bodies need to look beyond economic criteria when developing their activities. One criterion that should be used is the creation of stable, high-quality employment, which is key to the sustainable development of a tourist destination. In particular, social tourism's contribution (whether it be great or small) to combating seasonality is a basic criterion when aiming for quality and stability of employment, and should form an integral part of the European tourism model. Public-private partnerships in the management of social tourism can serve as a useful instrument and indicator for meeting this criterion.

2.4.5

The contribution of social tourism to global development. It has been mentioned above that tourism, particularly social tourism, can provide many communities with an escape route from underdevelopment or industrial crisis and the collapse of mining, industrial or farming activities. The conditions required for the development of social tourism are the same as those needed for an area and its inhabitants to see tourist activity as a driver of development. Insofar as communities can earn their livelihood from tourist activity, the local economy and social stability will be strengthened. As recommended by many international bodies, tourist activity is a good antidote to wars and disasters of all types. Tourism signifies welcome, exchange, the enhancement of local assets, friendship and communication between people, as opposed to war, which represents aggression, invasion and the destruction of nature. If one only loves what one knows, then tourism can encourage people to become closer and learn about each other, thus promoting peace, harmony and development. Social tourism can and should be reinforced, and should help to promote the conditions of equality, justice, democracy and well-being that enable the mutually-supportive development of all peoples around the world.

2.5

Principles and conditions of social tourism and its management. It is important to analyse the factors and criteria that characterise social tourism and the way it is managed so as to distinguish those aspects that can and those that cannot be labelled ‘social’. In line with BITS, we can indicate some of the criteria that determine the general concept of tourism:

the basic aim should be to increase the accessibility of tourism to all groups for whom such tourism is difficult, or to one particular group;

it should be open to a wide variety of user groups and sectors. It should also be open to different forms of management and social tourism practitioners;

groups at which activities are aimed should be properly defined: social categories, age groups, persons with disabilities, and always meeting the criterion of non-discrimination on the grounds of race, culture or social situation;

initiatives and objectives should be included that are humanist, educational, cultural and relate to personal development in general;

there should be transparency in the economic side of the activity, with profits reduced to the level necessary to meet the social objectives;

the tourism product should add non-monetary value;

there should be a clear desire to integrate the tourist activity into the local environment in a sustainable manner;

human resources should be managed in a way that promotes job satisfaction and integration, focusing on the quality of employment of social tourism organisation employees.

These and similar criteria can be used as guidelines for action by those managing social tourism, and to identify the activity.

2.6

Company profitability and social tourism. Social tourism is, quite rightly, an economic activity (although not exclusively so), and it should be governed by the basic principles of return on investment and the profit necessary to pursue and achieve its basic goals. Only businesses which are competitive and profitable in the broadest sense can operate effectively, safely and with guarantees for consumers. The varying situation of social tourism today shows that the businesses and organisations devoted to this activity are profitable once they have established their structure and have the right market and appropriate prices. It is worth noting that social tourism organisations create jobs both throughout the year and during low-occupancy periods, thus helping to provide employment for the workers affected.

2.7

Social profitability of tourism. Although social tourism is an economic activity, it is also clearly a social activity, bringing benefits in this field. Visitors benefit on their holidays, tourism workers benefit in their work, and society as a whole gains. In the EU's case, social tourism is having an increasing impact on the construction of the Citizens' Europe and will surely continue to do so. Travel within Europe by as many citizens as possible can only lead to greater knowledge, understanding and tolerance.

2.8

Concepts and views of social tourism in Europe. Social tourism today means different things in the different EU Member States that operate such programmes, but there are three points in common:

the real ability to have free time to go on holiday;

the financial ability to travel;

the existence of a channel, structure or instrument making these rights accessible in practice.

2.8.1

Thus, social tourism would include all travel and activities organised by trade unions, for family reasons, for religious reasons, organised by companies for their workers, organised by public institutions, for people with disabilities, young people or senior citizens with low incomes, and various other situations.

2.9

Social tourism bodies. There are also various bodies which work in and manage social tourism throughout Europe, including:

national federations or consortia;

public establishments, focused on social tourism or with activities relating to it;

social tourism, sporting or cultural associations;

cooperation bodies;

trade unions;

joint enterprises.

3.   Social tourism players and their roles

3.1

The European institutions. The European institutions are displaying a growing interest in social tourism, as illustrated by the various studies, opinions, reports and conferences being organised, promoted or coordinated by the Parliament, the Commission and the EESC. Essentially, their activity focuses on gathering, classifying and circulating the wide range of experiences acquired by European countries. In particular, the role being played by the Commission is to promote new experiences in each country, and to bring together those responsible in the various countries with a view to cooperating on transnational initiatives. At present, the Commission's role does not seem to include acting as general coordinator of social tourism experiences at EU level. It is worth noting the recent survey conducted by the Tourism Unit of DG Enterprise, which looked at EU citizens' participation in holidays and the reasons why some 40 % of them do not take part in tourist activities. It does not seem unfeasible that the Commission might one day take on the role of general coordinator for a social tourism platform at European level. This role would not necessarily call for financial contributions from the European institutions in order to develop such a joint transnational platform.

3.2

Member States' governments. As pointed out above, the involvement of Member States' governments in social tourism activities varies greatly for historical, ideological and social reasons. In some countries, the government, whether national, regional or local, provides significant financial aid. These funds are often aimed at various groups: young people, senior citizens, people with disabilities, underprivileged people, etc. Governments are currently taking steps to go beyond the national limits of their social tourism programmes with various types of transnational exchanges.

3.3

Employers. It is important to note that there are initiatives such as ‘holiday vouchers’, whereby employers contribute financially to help facilitate holidays for their staff. Furthermore, as mentioned, it should be borne in mind that social tourism is a major economic activity with great potential and, as such, attracts entrepreneurs from the tourism sector who see it as a means to boost their activities as service providers or intermediaries. One noteworthy initiative is the Spanish company Mundo Senior (‘Senior World’) which comprises various large tourism companies and was set up originally to manage the social tourism programme of the Ministry for Labour and Social Affairs, and which has expanded its social scope and activity by offering specialised tourism products for senior citizens. Clearly, the competitiveness criterion is not hindered by the social nature of this activity. In the future, there will need to be public-private partnership initiatives to develop profitable social tourism programmes both within Member States and between different countries.

3.4

Workers. Ever since social tourism first emerged, trade unions, as the bodies which defend workers' rights, have had a strong presence in tourism, as a means of obtaining benefits for their members. This presence is illustrated through support for physical infrastructure, holiday complexes, guest houses, etc. and for specialised services. Experiences and commitment levels vary from country to country, but in almost all countries there is some kind of social tourism activity stemming from trade unions. It is worth mentioning the trade union organisations of the newest Member States, which are seeking a valid model for social tourism and relations with more experienced bodies. It is also worth mentioning an interesting study that was carried out by BITS in May 2005, relating to various trade unions' tourism activities for workers and listing one by one the activities currently existing in the 25 EU countries. It is a useful source of information and analysis about the current state of play.

3.5

Specialised associations. These associations include the consumer cooperatives that in certain countries (Italy and the UK) have extensive networks of agencies organising social tourism, together with the youth and environmental organisations operating in this field, and the associations belonging to the social tourism bodies themselves, such as the BITS, which carries out important support, coordination and promotion work.

3.6

Groups involved directly and indirectly in social tourism. Evidently, the beneficiaries themselves are the main players in the various social tourism programmes and activities. It is they who benefit first from the economic advantages that enable them to enjoy their leisure time and holidays, taking part in the sporting or cultural activities that appeal to them. Secondly, they benefit from tourism that is respectful of geographical resources, heritage and the environment, and the relationship between the beneficiaries and the inhabitants of the host areas. Together, these activities help to foster mutual knowledge, relaxation and well-being. Local communities in which social tourism is practiced also benefit from employment, economic activity and development.

4.   The reality of social tourism in Europe today

4.1

Theoretical, legislative and planning context. In Europe, the theoretical, legislative and planning framework for social tourism is not very extensive at present; however, there are a number of studies and reports that aim to inventory and carry out comparative analyses of the various examples of social tourism in Europe. Some of these are listed as technical and documentary references in Part D of this opinion.

4.2

Various practical experiences in Europe. As indicated above, during the course of the study group's work, at the hearing held in Barcelona on 4 and 5 May 2006 and from the information on experiences described at the conference ‘Tourism for all’ organised by BITS and the Commission, it has been possible to single out and become familiar with many practical initiatives in Europe which may be described as manifestly successfully. It is not for this opinion to study these experiences in detail, but we do consider it appropriate to mention some of the most important which will undoubtedly help to raise the profile of social tourism and can serve as a guide for others working in the social tourism sector, or for those states or areas that, for various reasons, do not have programmes in this field.

4.2.1

The French Agence Nationale pour les Chèques-Vacances (ANCV) [National Holiday Vouchers Agency] had a turnover estimated at around EUR 1 billion in 2005. It was set up in 1982 as a ‘public body with industrial and commercial character’ and after more than 23 years of activity it remains a useful social policy tool for tourism.

4.2.1.1

Its objectives are threefold:

to help the maximum number of people possible to go on holiday, especially those on low incomes;

to provide free use through an extensive network of tourism professionals able to respond efficiently to all requests;

collaborate in the development of tourism, helping to achieve a more even spread of tourism across the regions.

4.2.1.2

It should be mentioned that holiday vouchers are received annually by some 2.5 million people and benefit some 7 million travellers. The ANCV has more than 21 000 affiliated organisations which participate in its financing and some 135 000 tourism and leisure practitioners are involved in providing services.

4.2.1.3

In addition, its programme helps to provide holidays for especially underprivileged groups, groups of disabled people, young people, etc. by means of holiday grants to the tune of EUR 4.5 million. The Agency also invests considerable sums in the modernisation of social tourism amenities.

4.2.1.4

Overall it would appear that the programme's continuity and profitability is assured; economic studies will, doubtless, show that the impact of its economic activities enable it to recoup the financial outlay.

4.2.1.5

The Agency's objectives for the next few years are to continue extending and disseminating its services among users and tourism practitioners. Perhaps these objectives could include a transnational dimension to the programme by means of agreements with European countries; the benefits would undoubtedly be mutual, exemplary and of great economic and social importance.

4.2.2

The IMSERSO social tourism programme in Spain has similar aims but uses a different approach and instruments. It helps more than one million people annually to go on organised trips, in groups, in the low season, and especially older people. The Spanish State invests about EUR 75 million annually in the programme, but through various tax mechanisms (VAT, tax on commercial and professional activities, corporate profits and income of physical persons), increased revenue from social security contributions and savings on unemployment benefits, the programme brings in some EUR 125 million and is therefore economically highly profitable. The social and economic profitability of the programme is clear as it has enabled broad sections of the elderly population to travel for the first time, to get to know other cities and places, broaden their social relations on an equal footing, improve their physical fitness — and the quality and user satisfaction is reasonable.

4.2.2.1

Furthermore costs are recouped at a rate of EUR 1.7 for every EUR 1 invested in the programme.

4.2.2.2

Mention should be made of the impact of this programme on employment, estimated at about 10 000 workers who would otherwise be unemployed in the low season as the hotels and other establishments and businesses remain open.

4.2.2.3

The programme is constantly expanding and evolving, seeking out new forms of social tourism with greater cultural, health and social value, such as stays in spas, undoubtedly successful, or cultural tours and events.

4.2.2.4

As in the case of France, there is broad scope for expanding the programme, not only within the country but also abroad. At present the Spanish Imserso has already reached an agreement with its Portuguese counterpart on an exchange of tourists and is studying doing the same with France. This could be an exportable model of great value for the rest of Europe.

4.2.3

Other experiences. Besides these two major social tourism programmes in Europe, there are other good examples, perhaps more limited, targeted more at more clearly defined users, but no less valuable for that. Such is the case of the example analysed at the Barcelona hearing, namely the Plataforma Representativa Estatal de Discapacitados Físicos (PREDIF) [Representative State Platform for Physically Disabled People] which focuses on a very specific group but successfully manages a programme of holidays for this group.

4.2.3.1

Different, but also very interesting and worth mentioning is the shared initiative of three organisations, one from the UK (Family Holiday Association), one from Belgium (Toerisme Vlaanderen) and one from France (Vacances Ouvertes) which coordinate to facilitate ‘tourism for everyone’ in their three countries.

4.2.3.2

Social tourism activities can also be found in other European countries, including Portugal, Poland and Hungary, where the trade unions play an important role, and in Italy where the programme is sponsored by the consumer cooperatives. To conclude, it can be stated that the variety of initiatives, user numbers and diversity are on the increase throughout Europe.

4.2.3.3

Similarly, it must be noted that some regions and municipalities are developing social tourism initiatives in one form or another, e.g. the Autonomous Community of the Balearic Islands with its Plan OCI 60.

4.2.3.4

At regional level too, the government of Andalusia (Spain) is developing the Residencias de Tiempo Libre [Leisure Time Guest Houses] programme, along with the Conoce tu Costa [Know Your Coast] programme, which involves cooperation between the regional administration and local councils to encourage tourism by older people within the Autonomous Community.

4.2.3.5

Mention should further be made of the presence of social tourism on the European Union's tourism portal, www.visiteurope.com, which is intended as a consultation site for all tourist activity in Europe, including social tourism.

4.3

General assessment of social tourism. Social tourism brings many values to European society, including:

satisfaction for beneficiaries, not just through the direct activity of taking a holiday, but also through the ‘special’ nature of this leisure activity;

the human dimension and values of the activity;

improvement in the well-being and personal development of beneficiaries and the hosting community;

profitability and economic gain for the tourist industry, particularly by extending the high season;

benefits from the creation of stable, high-quality employment year-round;

maintenance of sustainability in host areas;

enhancement of the local environment and its natural, social and cultural resources and heritage;

boosting of knowledge and exchange between EU countries.

4.3.1

This whole set of values, together with the successes that social tourism has already achieved, the prospects for growth, and the research into and introduction of new products, all make for a highly positive general assessment of social tourism in Europe from all angles.

4.3.2

Such an all-round positive assessment means that we can dub social tourism a ‘miracle’ in that all the practitioners and users obtain all kinds of benefits: economic, social, health, employment, European citizenship … no one is harmed by this activity … the bottom line is that it would be difficult to find a human economic activity that is so universally recognised and supported.

4.3.3

Accordingly it is not difficult for this opinion to warmly commend proposals and formulas which would (i) consolidate and improve existing programmes and (ii) extend their benefits to broader sections of the population.

B.   PART TWO: PROPOSALS

5.   Towards a European social tourism platform

5.1

Prerequisites. It has been shown above that, regardless of the definition given of social tourism or how it is financed or managed, it is a powerful, profitable and stable economic and social factor, which meets its objectives whilst satisfying its beneficiaries, contributing to employment and reducing the seasonal nature of tourism. Indeed, it is an activity that is of great value throughout the world, particularly in Europe. The aim, therefore, is to examine how the beneficial effect of social tourism can be extended more widely to individuals, companies and society as a whole.

5.1.1

It is not easy to subsume under a single name a Europe-wide social tourism action: we can speak of a platform, project, project, initiative … and although these terms do not necessarily signify the same thing they all allude to an organised activity, with clear objectives, of supranational European scope. In this opinion, given that it is intended as a general proposal, these terms are used interchangeably in the hope that the work of this future platform will suggest a suitable name.

5.1.2

Nevertheless, it is clear that tourism in Europe does suffer from various shortcomings and medium-term threats, such as:

the serious, growing phenomenon of seasonality in the tourist industry, both in northern and central Europe as well as on the Mediterranean coast, where areas are deserted during low season and adequate year-round infrastructure is lacking;

under-use of human resources during low and shoulder seasons;

significant growth in the working population due to emigration, which makes it necessary to increase economic activity in order to maintain the same standard of living;

difficulty for the tourism industry to maintain sufficient year-round price and occupancy levels in order to maintain profitability in the medium term;

objective limits to the number of bedspaces that can be utilised for the purpose;

for development to be sustainable in the tourism industry, it is necessary to increase the added value of each tourist area throughout the year: increasing the quality (and, as a result, the price) or average annual occupation by increasing the season during which tourist establishments are open;

the emergence of numerous tourist destinations throughout the world offering competitive and innovative products and services. This new competition should, above all, serve to stimulate quality and competitiveness.

5.1.3

There are also factors that represent clear opportunities in terms of the viability of a possible European social tourism platform or project:

gradual increase, in absolute and relative terms, of citizens who are not working but have pensions and a sufficient standard of living in Europe;

gradual increase in life expectancy of Europeans;

increase in the average amount of leisure time that a person has throughout their life, particularly when they are older;

reduction in transport costs due to the boom in low-cost airlines, which favours mobility and tourism;

growing cultural awareness level which encourages responsible, sustainable tourism;

good and successful experiences with social tourism programmes throughout Europe;

accession of countries to the EU, which increases the market and the possibilities and opportunities for travel.

5.2

A European social tourism platform could have various objectives:

to generalise and extend existing programmes and number of users of social tourism throughout Europe, until every country has its own programme;

to harness the transnational nature of existing programmes through bilateral or multilateral cooperation programmes;

to establish the conditions for designing and implementing a European social tourism platform, in which the potential beneficiaries are European citizens who can visit other countries in an affordable and sustainable manner; in this context, it would be useful to find out how many Europeans have never visited another European country, as this group would probably be quite numerous and would underpin the programme;

to promote the gradual implementation of European-scale social tourism in which as many states as possible participate.

5.3

Players and groups involved in the European social tourism platform. The groups or players that could be involved include:

organisations that currently manage social tourism programmes in the various countries;

trade union organisations and cooperatives interested in the development of the programme;

employers in the tourism sector (in its broadest sense) interested in improving the sustainable profitability of their establishments;

national, regional and local governments interested in taking action in the field of tourism, its improvement, and the personal and social development of their citizens;

the EU and its institutions, interested in boosting and promoting employment, economic activity and European citizenship; given the supranational dimension of the platform, the EU institutions should also have the task of coordinating and monitoring the conditions under which the programme is developed, including heading up its establishment;

social tourism organisations, especially BITS.

5.4

Key aspects of European Social Tourism. In order for a European social tourism platform to be socially and economically viable, it must meet the following criteria:

It must be aimed at the most economically, territorially or socially underprivileged groups, or groups with disabilities, particularly those with a physical or mental disability, or which find it difficult to travel for geographical reasons (such as Europe's islands). This means being responsible for partial, fair and equal financing, irrespective of the length of the holiday and stays, as a way of compensating for the situation of the underprivileged in the broadest sense.

Overall, it must be economically and socially profitable in the short, medium and long term, at both public and private levels.

It must create stable, high-quality employment throughout the year. Centralised management and an effort to maximise stays in tourist establishments would be necessary to meet the employment objective.

It must be implemented during low occupancy seasons.

It must be sustainable and ensure personal and social enrichment both for beneficiaries and host communities.

It must maintain high-quality services commensurate with the objectives.

It must take the form of public-private cooperation.

If these conditions were met, social tourism would doubtless become a key component of the European tourism model.

5.5

Public-private cooperation in the project. The feasibility of the programme may well be dependent on — but could also benefit from — effective public-private cooperation in its planning, design and management. It would seem at least possible, although not easy, to find organisations and businesses in Europe that are willing to undertake the development of a European social tourism platform.

6.   Effects and results of a European social tourism platform

6.1

On growth and employment. Should this platform be implemented in its various phases, the effects on growth and employment would be major, and would surely help to achieve the objectives of the Lisbon summit. The IMSERSO programme undertaken in Spain, for example, clearly shows the beneficial impact of social tourism on safeguarding and creating jobs during the low season.

6.2

On the effective right to access tourism. Although, according to the statistics available, around 40 % of the population do not currently go on holiday, the European social tourism platform would aim and no doubt help to reduce this percentage substantially and make tourism for all a reality, as well as helping the peoples of Europe to get to know each other better.

6.3

On the European tourism model. In its various opinions on tourism, the EESC has expressed its belief that it is possible to build a European tourism model based not on legislation, but on widely accepted and applied values. One of the values that could be included in this model is undoubtedly universal access to tourism — tourism for all. The European social tourism platform could significantly help to boost the European tourism model.

7.   Contribution of tourism, particularly social tourism, to the construction of a European identity and dimension

7.1

In recent years it has become evident that the European venture is not a short or easy task, and even today there are still many uncertainties and difficulties to overcome. Social tourism could be a powerful tool to boost information and understanding between individuals and solidarity between peoples. It could help to build the Citizens' Europe not through sacrifice or struggle, but through the enjoyment of leisure time, travel and holidays. Young people, especially, are a group that are likely to travel more during high season — a period when student residences are unoccupied and could temporarily play host to tourist initiatives similar to the Erasmus programme.

7.2

Tourism could be a good way to build the Citizens' Europe. The various groups involved, the tourism industry and local communities could together bring their interests into line, in a way that is pleasant and accessible to all.

C.   PART THREE: CONCLUSIONS AND RECOMMENDATIONS

8.   Conclusions

8.1

A first general conclusion to be drawn from this opinion's analysis of the situation of social tourism in Europe today is that it is an environmentally, economically and socially sustainable activity, and an activity of the first order in each of these three spheres.

8.2

The economic, social, health and integration benefits that all the users and practitioners participating in the programmes gain are widely acknowledged and of considerable added value.

8.3

The various social tourism user groups and in particular people with a disability and/or reduced mobility get an enormous boost towards their full integration as individuals.

8.4

On the ground, social tourism in Europe is characterised by a wide variety of practitioners, forms of development, public objectives, financial instruments, etc. which enrich it, diversify it and contribute to its development and evolution.

8.5

In particular we can conclude that the profitability of social tourism is compatible with and positively linked to economic profitability.

8.6

It is economically feasible and socially desirable for each European country to develop a national social tourism programme with a diversity of approaches and management forms.

8.7

It is economically feasible and socially desirable to establish a transnational European social tourism platform.

8.8

Every social tourism activity should incorporate a set of sustainability and job-creation values in line with the Lisbon strategy.

8.9

Social tourism can be highly valuable tool for the creation of a Citizens' Europe, embracing all citizens; the role of young people is particularly important in this process.

8.10

Social tourism is an activity that displays some of the values which can be incorporated into the European tourism model.

8.11

All local communities throughout Europe could benefit from social tourism, due to its contribution to the protection of cultural and local heritage.

8.12

In conclusion, social tourism today is a mature activity practiced in many of Europe's Member States, with good management and organisational structures. It is ready to progress towards implementation in all countries, making its services transnational and thus increasing the quality and quantity of its objectives.

9.   Recommendations

9.1

The basic recommendation for potential users of social tourism programmes is clearly to encourage them to participate in an activity such as tourism, to which they have a right but to which they may not have had access for a whole host of reasons. Social tourism clearly promotes integration, greater knowledge and personal development, and as such participation in its activities is desirable.

9.2

With regard to the wide range of practitioners who are involved in managing the various social tourism programmes, first we should acknowledge the benefits of their work, their dedication to their organisation's mission and the care they put into providing an accessible but high-quality service to users. But we should also encourage them to go on improving their products and services, investing in improvements to infrastructure, innovating with new products, especially with a transnational dimension. The coordination of programmes and formation of associations between the organisations responsible are a good way of improving and exchanging experiences.

9.3

With regard to businesses in the tourism sector, we would recommend that they take part wholeheartedly in social tourism activities. The values of social tourism are compatible with good business management, competitiveness and profitability, in the short term but particularly in the medium and long term, and make it possible to secure the jobs of many workers over the whole year.

9.4

With regard to national, regional and local institutions and governments, we would advise them to establish social tourism programmes on account of their social but also economic benefits. The additional revenue from taxes and contributions, the savings on unemployment benefits, are clear incentives to provide fair subsidies to economically, socially or physically disadvantaged groups, in the certainty that the costs will be recouped with interest.

9.5

Our recommendation to the European institutions is to bear in mind that social tourism is an important activity which shares objectives with tourism and social policy, is an activity which merits recognition, development, specialised technical assistance, support and incentives (not necessarily economic). Guidance, technical coordination, dissemination of experience and a forum for concluding transnational agreements are among the tasks that the Commission especially, through its tourism unit, can provide with its own resources in order to set up an effective European social tourism platform. The Commission's leadership in these aspects of promoting social tourism would undoubtedly be a valuable tool for achieving the objectives and monitoring initiatives.

9.6

All institutions should consider boosting their policies to eliminate all types of barriers in communications infrastructures and in accommodation and tourism service infrastructures. The case of Europe's islands clearly illustrates how their geographical situation strongly affects mobility and access to tourism for their citizens.

9.7

Given its political, social and economic dimensions, the European Parliament should launch initiatives to promote a debate and resolutions encouraging social tourism in Europe.

9.8

The EESC concurs that this opinion should be known, published and distributed as the Barcelona declaration on social tourism in Europe, and serve as its contribution to the 2006 European Tourism Forum and this year's World Tourism Day.

D.   PART FOUR: TECHNICAL AND DOCUMENTARY REFERENCES

The different concepts of social tourism: the evolution of supply and demand, European Commission, Directorate-General XXIII, Tourism Unit, 1993.

Montreal Declaration: towards a humanist, social vision of tourism, BITS, September 1996.

Global Code of Ethics for Tourism. World Tourism Organization, Santiago de Chile, 1 October 1999.

Report on the seminar on assistance for holidays in the European Union, European Parliament, Strasbourg, March 2000.

The concepts of tourism for all and social tourism in the European Union, BITS, Bruges seminar, June 2001.

Report on the results of the survey on Tourism for all, June 2001.

Opinion: Socially sustainable tourism for everyone, EESC, October 2003.

Study on the Holidays for the Elderly programme, Spanish institute for migration and social services (IMSERSO), Spain, May 2004.

European Forum on Social Tourism, BITS, Budapest, April 2005.

Report on tourism and development, European Parliament A6-0173/2005, May 2005.

Report on new prospects and new challenges for sustainable European tourism, European Parliament A6-0235/2005, July 2005.

Tourism for all. Action plan of the Spanish representative committee for people with disabilities (CERMI), December 2005.

Consultation on tourism activities and holidays for workers, BITS, Brussels, May 2005.

European conference on social tourism, economic growth and employment, Government of the Balearic Islands, Palma de Mallorca, November 2005.

Conference on Tourism for all: State of play and existing practices in the EU, European Commission, Directorate General for Enterprise, Tourism Unit, January 2006.

World Social Tourism Congress. Towards a tourism based on development and solidarity. Aubagne (France), May 2006.

Brussels, 14 September 2006.

The President

of the European Economic and Social Committee

Anne-Marie SIGMUND


(1)  The different concepts of social tourism: the evolution of supply and demand, Directorate-General XXIII, Tourism Unit, 1993.


23.12.2006   

EN

Official Journal of the European Union

C 318/78


Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council concerning structural business statistics

COM(2006) 66 final — 2006/0020 (COD)

(2006/C 318/13)

On 27 March 2006 the Council decided to consult the European Economic and Social Committee, under Article 285(1) of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 26 July 2006. The rapporteur was Ms Florio.

At its 429th plenary session, held on 13 and 14 September 2006 (meeting of 14 September), the European Economic and Social Committee adopted the following opinion by 130 votes, with seven abstentions.

1.   Background

1.1

On 20 December 2000, the European Council decided to launch a ‘Multiannual programme for enterprise and entrepreneurship, and in particular for small and medium-sized enterprises’ (1). This new reference framework was intended by the European Union to improve the competitiveness of enterprises in a knowledge-based society, to simplify and facilitate their legal, administrative and financial environment, and above all to foster research and innovation, give them easier access to services and Community programmes and promote entrepreneurship.

1.2

In early 2003, the European Commission presented its Green Paper on Entrepreneurship in Europe (2), in which it stressed the need for targeted support and called for strategic policies to promote the industrial and manufacturing sector, which has been experiencing a perilous slow-down for years now in Europe, above all when compared with other areas of the world.

1.2.1

The principal actions proposed to support and increase the entrepreneurial spirit in Europe were:

bringing down barriers to business development and growth,

balancing the risks and rewards of entrepreneurship,

encouraging a more favourable attitude in society as a whole towards the establishment of new businesses.

1.3

In 2004, following a consultation of stakeholders based on the Green Paper, the Commission presented an action plan on entrepreneurship (3) which took account of the new responses received and built on the Multiannual Programme for Enterprise and Entrepreneurship.

1.4

At both national and European level, key issues such as industrial policy, support for services, and employment as an engine of economic growth are closely linked to priorities in the employment and social spheres, which are an important goal of the European Union's policy decisions. In this area, too, the European institutions have taken a number of initiatives in recent years, including the presentation of an annual plan by Member States.

1.5

The Luxembourg Summit of 1997 launched the European Employment Strategy (EES), which would later be seen as a key element of the Lisbon Strategy. It is the Lisbon Strategy, in fact, which set the goal of modernising the European economy by cutting unemployment and creating highly skilled jobs. These goals can only be achieved if attention is paid to social policies and to policies providing equal opportunities among all levels of the population. This is in effect a sine qua non, prior to a substantive restructuring of the economic system, for achieving a higher growth rate and a ‘healthy’ economy.

1.6

Other elements that were to be included in this ambitious project are the European Research Area, a complete integration of markets and the creation of an SME-friendly environment. In its proposal on the Competitiveness and Innovation Framework Programme (2007-2013) (4), the Commission itself states that the promotion of technologies and research is directly linked to exploiting opportunities offered by the market to new products, services and business practices. The willingness to take risks and try out new ideas on the market should also be nourished. Insufficient innovation is one of the main causes of Europe's disappointing growth.

1.7

On the social cohesion front, there was a call for immediate interventions in the fields of education/training and social protection. To ensure coordination between Member States when formulating their policies, an open method of coordination was mooted through which best practices and performances in the different fields would be exchanged and disseminated.

1.8

It was thanks to the mid-term review of the Lisbon Strategy that in 2005 the European Commission was able to present its Communication on growth and employment (5), which focused attention on two important points: bringing about solid and sustainable economic growth and creating ever more and better jobs. These goals were thought to be achievable through a synergy of the Community and national levels.

2.   General comments

2.1

The process of change in the economy and manufacturing spheres is continuous and fast moving: the various industrial sectors and their operators adapt and innovate to keep abreast of market evolution, endeavouring to remain competitive and create ever greater growth and profit opportunities.

2.1.1

In a market such as the European one, where businesses evolve at break-neck pace and traditional sectors (manufacturing, commerce, distribution, etc.) encroach upon one another, the demarcation line between the different types of operation can be difficult to define. Moreover, when it comes to assessing and classifying businesses, it is becoming more and more difficult to determine where the main thrust of their activity lies (whether in commerce, agriculture, manufacturing, cottage industry, services, etc.).

2.1.2

The growth of the social economy to a point where it now accounts for a large and increasing part of the European market makes it difficult for statistical data to keep pace with a situation of constant flux and renewal. Eurostat officials say they have found it difficult to define this field because social economy activities are not always registered as business activities. However, the Committee thinks that no effort should be spared in order to measure the increasing importance of the social economy sector, which is crucial for the achievement of the Lisbon Strategy objectives. Absence of such data is an obstacle to a better understanding of developments of the business world and the market place.

2.1.3

The importance of obtaining structural statistics on the European Union's businesses — updated and focused above all on their activity, competitiveness and output — has been established. In stressing the importance of statistical support, it should be remembered that the collection and subsequent processing of data involves what could be substantial investments in human and financial resources, especially for small businesses.

2.1.4

Economic growth is an absolute priority for all the countries of the European Union, as the European Council and other European institutions have reiterated on countless occasions. This economic growth must necessarily be accompanied by the creation of new and better jobs. In all sectors, but especially in manufacturing and the services sector, this must be done in a way that fuels growth itself and allows Europe's citizens to reap the benefits.

2.2

The European development model differs from others in the considerable role attributed to the social component and to the very notion of sustainable economic growth. This must be borne in mind whenever the European institutions intend legislating in their sphere of competence.

2.3

This means that a very clear idea of the real state of European industry is needed if truly effective, useful and coherent legislation is to be framed. Political choices should be based on an analysis of the real situation and the problems involved and offer solutions that embrace as many elements as possible, seeking to anticipate the impact that decisions will have on that situation from all angles (political, economic, legal, social, national and subnational).

2.4

Statistical data are undoubtedly a crucial instrument for a thorough and effective analysis of reality. The work Eurostat has carried out since its inception is a valuable and indispensable support for the European Union's decision-making and political processes.

2.4.1

Statistical data are of fundamental importance because they can measure, study and describe the numerous and diverse aspects of the reality on the ground. The availability of statistical information is cardinal for the formulation and evaluation of policies, for the management of public services and functions, for a better legislative framework and for regular ongoing monitoring of the success and the progress delivered by the policies adopted.

2.5

This is true for all areas of the European Union's competence. For this reason Eurostat, supported and assisted by the statistics institutes of the Member States, is charged with compiling and providing up-to-date and reliable data. Of crucial importance in recent years have been the data collected in the fields of economy and finance, agriculture, demographic policies, social security, business, scientific research, environment, transport and, no less important, the world of industry and its attendant market indicators.

2.5.1

To have an idea of the importance attributed to the European business world and its development, one need look no further than the initiatives the Commission and the Council have taken on this front in recent years.

3.   The proposal for a regulation on structural business statistics

3.1

Council Regulation (EC, Euratom) No 58/97 adopted by the Council on 20 December 1996 has been amended no fewer than four times in the last decade, and this is the latest proposed recast, intended to improve the coherence of analyses and applicability of polices and strategies for supporting European industry and manufacturing.

3.1.1

To respond to the increased need for statistics, the Commission proposes a number of improvements, paying particular attention to services, which have been at the centre of considerable discussion in recent months because of their economic importance and their potential, which is not entirely reflected at EU level. The Commission also adds an annex on the demography of enterprises and business services.

3.2

The Commission has confirmed that no detailed and recent statistics are available for a raft of activities, mostly related to business services; the new proposal is therefore an opportunity to adapt the provisions in force so that economic and manufacturing activities can be compared with those in services.

3.2.1

In addition, the Commission has considered it necessary to have harmonised data on the demographics of businesses (start-up, operation and wind-up) and their impact on employment to support strategic recommendations on the spirit of enterprise. The ‘demographic’ data of businesses already feature in the structural indicators used for monitoring the goals set by the Lisbon Strategy. It is in this context that the Commission's proposed recast should be examined.

3.3

The proposal identifies the NACE code, normally used by the Commission's services for all statistics on economic activity, as the reference instrument for collecting statistical data (6). The NACE code has itself been revised and updated to provide a better understanding of trends in the EU's economy and manufacturing.

3.4

NACE REV. 1.1, the reference indicator, is simply an update of NACE REV. 1 and does not represent a significant reorganisation. The purposes of the revision was to reflect:

new activities that did not exist when NACE REV. 1 was drawn up;

activities which had become more important since the drafting of NACE REV. 1 as a result of changes in technology or in the economy;

the correction of errors in NACE REV. 1 which were already apparent at the time, i.e. not reflecting any changes in the philosophy of the operation.

3.4.1

The latest version of NACE, bringing new modifications and revisions, is currently at its second reading in the European Parliament and will be launched in the coming months.

3.5

The collection of statistics, defined by the field of application (Article 2), is organised in modules, as set out in Article 3 of the proposal for a regulation:

a common module for annual structural statistics;

a detailed module for structural statistics in industry;

a detailed module for structural statistics in trade;

a detailed module for structural statistics in construction;

a detailed module for structural statistics in insurance;

a detailed module for structural statistics on credit institutions;

a detailed module for structural statistics on pension funds;