15.11.2012   

EN

Official Journal of the European Union

C 351/1

1.1

The EESC feels that long-term, sustainable and smart growth is not possible without a process of catching up. It therefore feels that the triple objective of the Europe 2020 strategy, i.e. smart, sustainable and inclusive-cohesive growth, is generally appropriate; however, in order to achieve these objectives, a well-balanced macroeconomic policy mix and structural reforms together with more and better instruments are needed.

1.2

Intelligent implementation of the strategy has become all the more important in this period of major challenges. We need to build on the existing strategy, to fine-tune and adjust it to the new macro-economic situation. We need to strike a new balance between responsibility and solidarity.

1.3

In order to achieve the requisite change of emphasis the EU needs to show that it has the necessary political will and a specific vision of substantially closer integration. At the same time, it is vital to enrich the various forms of multilevel cooperation between Member States and the regions, and to achieve "more and better" Europe.

1.4

In the EESC's view, governance in support of economic policy and development must be further strengthened, with more abundant and diverse government funding, and support for faster structural reforms in the Member States.

1.5

The EESC feels that it can endorse the general approach and emphasis of the regulatory framework for implementation of the EU 2020 strategy, i.e. the Multiannual Financial Framework (MFF) and the Common Strategic Framework (CSF).

1.6

At the same time, the EESC emphasises that measures in support of stability, growth, employment and poverty reduction are not sufficient; it is essential to widen the range of existing instruments.

1.7

Responsibilities have to be clearly divided between the European Union and the Member States. In the interests of strengthening foundations for growth, implementation of measures such as a European banking union (European regulation, monitoring, bailouts and guarantees of bank deposits), together with the issuance of project bonds, should be accelerated. The role of the European Central Bank should be strengthened.

1.8

In the Committee's opinion, it is not enough just to define "frameworks" for development policies. By stepping up targeted investments, and implementing pan-European, cross-sectoral, multi-dimensional programmes at European level, the objectives can be achieved more quickly. Given that completion of structural reforms is currently the vital issue in many countries, development policies must support such reforms.

1.9

In order to combine smart and inclusive growth, one possibility is to increase employment as a goal and to encourage networks covering a wide range of activities. To this end, the Single Market needs to be consolidated in numerous areas.

1.10

However, cohesion policy must not remain purely focused on boosting the economy and competitiveness. All the funds and programmes should be more tailored to the social goals of the Europe 2020 strategy such as job creation, social services, combating poverty, education and training, etc.

1.11

The EESC feels that individual proposals for the 2014-2020 period, such as the planned development of macro-regional strategies, should be backed with the requisite instruments.

1.12

If extended to other common European objectives, and with the involvement of private-sector funding too, the Connecting Europe Facility could be a good example of closer integration.

1.13

Reconciling the EU 2020 strategy and cohesion policy requires a strategy and associated instruments which are European in scale while also taking the local and regional dimension into account. Work on drawing up a European Territorial Strategy must be accelerated.

1.14

In our opinion it is vital to ensure much broader involvement of experts and public opinion in preparing decisions. We therefore suggest defining a 12th thematic objective in the Common Strategic Framework, in order to strengthen "communication and social dialogue".

2.1

Over the last few years - partly due to international changes, partly due to enlargement of the EU, the crisis and Europe's response to it - the EU has become more complex, with a greater tendency to multi-speed integration, and more divergent national interests.

2.2

The threat of social and political conflicts has grown, and political extremism is gathering momentum. We need to acknowledge that overcoming the economic, financial and social/solidarity crisis will remain Europe's main challenge, up to the middle of this decade. Unfortunately, in many Member States output has fallen significantly. A conflict has arisen between financial stability and growth. Without growth, efforts to achieve stability and solidarity are also in conflict.

2.3

The EU 2020 strategy was not designed with this situation in mind. The strategy took the crisis into account, but it did not anticipate that it would last so long or be so serious.

2.4

The EU needs both fiscal consolidation and an effective programme for growth. There are some grounds to hope that the drop in demand that is resulting from the indispensible fiscal consolidation can be offset in the long term if that consolidation is done in an intelligent and balanced way.

2.5

In the EESC's view, the multi-annual financial framework (MFF) proposed by the Commission for the 2014-2020 period represents a relatively acceptable compromise. If we can succeed in increasing the EU's own resources and making more efficient and effective use of them, while focusing them on objectives which are directly linked to the EU 2020 strategy and structural reforms, this will support economic development.

2.6

However, the proposal does not sufficiently address catching-up issues and social tensions. The (undoubtedly very significant) financial assistance provided to countries struggling to achieve budgetary stability has exhausted the capacity of donor countries.

2.7

Cohesion policy must not remain purely focused on boosting the economy and competitiveness. All the funds and programmes should be more tailored to the social goals of the Europe 2020 strategy such as job creation, social services, combating poverty, education and training, etc.

2.8

Relatively significant changes are taking place in the field of cohesion policy. The focus here has shifted to strengthening macro-and micro-economic conditions together with territorial convergence. However, in order to ensure the EU 2020 strategy is implemented in harmony with inclusive/cohesive growth, a paradigm shift is needed. Cohesion policy funds are not donations or subsidies; they are part of European investment policy, and must be used efficiently.

2.9

In order to achieve inclusive and sustainable growth, alongside traditional criteria, there is an vital and growing role for certain "soft" factors, e.g. the situation in terms of healthcare and demographics, as well as educational quality and trends; at the same time, there is more and more interest in a healthy environment. Recent documents pay very little attention to the possibility of providing the requisite Community support in this area.

2.10

The European Commission has published a proposal on opening the labour market with the aim of reversing negative trends. Subsidies could boost both supply and demand. It is particularly important to ensure the transferability of pension rights and to dismantle the various legal, administrative and fiscal barriers.

3.1

The expected dynamic development resulting from the EU 2020 strategy is not adequately reflected in simplification and increased efficiency of the institutional system, nor are adequate additional resources being made available to this end.

3.2

In difficult situations it is vital to make maximum use of intellectual resources. It makes sense to strengthen permanent and/or temporary analytical, advisory, monitoring and early warning bodies alongside legislative and executive bodies. For example, such bodies could look at the following issues:

3.3

It is of fundamental importance to ensure that the European Union operates transparently and to strengthen participatory democracy. It would be useful to make much greater use of online forums, and in cases where face-to-face discussions are more effective, high level and broad ranging conferences could be organised and/or supported, in parallel with debates in national parliaments. It is recommended to strengthen EU communication, and inform the public of certain European negotiations; in a more limited number of cases, online monitoring or details of voting could be made accessible to all.

3.4

The three objectives of the EU 2020 strategy are extremely ambitious. However, as several EESC opinions have emphasised, there is a mismatch between the timeframe envisaged and the available resources, particularly in view of "historical" experience, which has been both negative as in the case of the first "Lisbon" strategy, and positive as in the case of the rapid and effective economic governance measures which have already been mentioned here.

3.5

From the point of view of procedures and implementation, the measures and legislative proposals envisaged in order to achieve EU 2020 objectives and make use of cohesion and structural funding only broadly reflect the lessons learned during the period up to 2013.

3.6

The principles and thematic proposals set out in the Common Strategic Framework (CSF) offer good prospects for progress towards "more" and "better" Europe. However, they are not sufficient to translate these prospects into reality. Some countries will have to change their approach to planning if we are to work out the details.

3.7

Over the past few decades, particularly in the field of research and development, and in major infrastructure projects (in the latter case inevitably given the intrinsic nature of the tasks) a broad European approach has emerged, which can be adapted at regional level. The EU's strategies, including the 11 thematic objectives, have shortcomings in terms of sectoral economic policies and multidimensional regional development programmes.

3.8

A future regional development strategy could define objectives and instruments to encourage macro-regional economic and social cooperation in areas such as:

3.9

Over the past decade the potential offered by urban systems on the one hand, and on the other the accumulated tensions within them, have appeared in unmanageable concentrations.

3.10

Networking between individual European urban centres, hubs and concentrations of highly developed activities in line with the concept of excellence could be a good example of dynamic and cohesive, but sustainable development.

3.11

The vision of a connected Europe, as part of a macro-regional strategy, could add the thematic guidelines needed for political and institutional, economic and social integration to infrastructure elements, thus helping to achieve objectives more effectively at macro-regional level. This broader approach would still be compatible with proportionate and fair distribution of resources.

3.12

In a previous opinion, the EESC also recommended identifying a new European framework for integrated project concepts of "special European interest".

3.13

It is worth considering full implementation of a European Energy Community, given that with political support the EU could speak with one voice in international forums, at the same time as more effectively representing the strategic, economic, environmental and social aspects.

3.14

In the absence of conceptual progress at European level, legislative proposals and financial frameworks for the 2014-2020 period will once again push Member States in the direction of individual and often ineffective solutions.

3.15

The EESC could do justice to its role if, on the basis of its composition, it uses its expertise and a sophisticated methodology to express knowledge reflecting relations between economic interests, social values and the criteria determining the sustainability of growth.

4.1

The EU 2020 strategy, the regulatory system supporting implementation of the cohesion funds in the post-2014 period, and the Common Strategic Framework are examples of an awareness of what integrated development involves.

4.2

However, the EESC feels that global competition requires not just awareness, but the planning and implementation of more specific, wider ranging programmes.

4.3

The overarching goal to be achieved through the smart and inclusive growth envisaged by the EU 2020 strategy is to boost the EU's production and reception capacity at macroeconomic level, at the same time as ensuring constant and sustainable improvement in the quality of life for ordinary Europeans at microeconomic level, based on quantitative and qualitative employment growth.

4.4

In order to achieve effectiveness and efficiency, plans for the use of European funds must take into account that there are certain interconnected, interdependent activities which may be presented as specific multi-dimensional and integrated clusters.

4.4.1

Such objectives, which span multiple sectors, are of macroeconomic relevance and therefore influence the competitiveness of the European Union. In such cases, it is vital to focus on organisations participating in the development process or directly impacted by it and which are linked in terms of production or services.

4.4.2

Territorial (regional and local) networks of stakeholders in (or beneficiaries of) development processes, and the system of relations between them, must be taken into account in planning processes.

4.5

Analysis and planning of the two above systems of interaction, together with EU-level support, will make it possible to achieve the combined impact of smart and inclusive growth.

4.6

In the past decade, largely due to EU-financed infrastructure development, the European structure of such manufacturing processes has fundamentally changed, resulting in the development of production tools and culture in backward regions, renewing education and vocational training, at the same time as boosting employment, income and consumption.

4.7

Development of the spatial structure of the economy is determined by conditions which can be ensured at microeconomic level; these conditions are closely linked to the criterion of "sustainability" envisaged by the Strategy.

4.8

Factors such as the education, age and vocational training of employees, their general work culture, expansion of employment, and the quality of services are important here. The health of the local population, the quality of the environment, and course the business and physical infrastructure, as well as the level of logistical systems, are also important prerequisites.

4.9

Such coordinated development capable of bringing together macro- and microeconomic levels is a key factor in European competitiveness.

4.10

Provided funding is used efficiently and effectively, a change in its focus could be justified by the following arguments:

4.11

With regard to EU support for economic sectors (particularly in the form of non-repayable subsidies), it is generally agreed that small and medium-sized enterprises engaged in innovative activities and declining industrial regions affected by structural changes are the areas where funding is most needed. In relation to production networks, the concept of "entrepreneurship" may require the stepping up of support for SMEs in individual underdeveloped regions or cities, if growth which is both smart and inclusive or allowing areas to catch up is to be achieved.

4.12

In the case of well functioning innovation chains, clusters and local production systems, it would be worth considering whether to ensure greater flexibility both for large companies established in a particular region, and for suppliers, by providing them with various forms of combined financing.

4.13

Healthcare is one example of how a multidimensional strategy can be developed. Health sector networks range from health and environmental education to the various related manufacturing sectors, and include training, with the involvement of the environmental sector, the healthcare sector, medical tourism, biological research, equipment manufacture and the associated higher education activity, experimental and innovative industrial parks together with the small and medium enterprises operating within them; at the same time, all of these fields interact with such networks. The "grey" economy is playing an increasingly important role here.

4.14

The EESC has analysed the role of the social economy as a key factor in policies to achieve inclusive growth in several opinions.

4.15

The economic and financial interaction of activities capable of comprising networks of similar type to those mentioned as examples could have a major impact on structural reforms in Member State budgets, which in turn could change social attitudes and behaviour.

4.16

A macro-level approach to regional development could strengthen polycentric European territorial restructuring, thus consolidating both the requisite concentration of activities, and, by taking advantage of different local conditions, sharing tasks within a network, in line with the ideal of sustainability.

15.11.2012   

EN

Official Journal of the European Union

C 351/6

1.1

The aim of this opinion is to contribute to the information and discussions on and potential development, at Community level, of legislative or other measures to protect children and young people from certain types of advertising that use children improperly or target them in a harmful way, or expose them by any means to messages that could harm their sound physical, mental or moral development.

1.2

At stake here is the protection of the basic rights of children in the EU, as set out in the United Nations Convention, in Article 24 of the European Charter of Fundamental Rights, and in Article 3(3) of the TEU. These rights have been well interpreted in the Commission's Communication Towards an EU strategy on the rights of the child (COM(2006) 367 final), in the Multiannual Community programme on protecting children using the internet and other communication technologies (COM(2008) 106 final) (1), and in the EU Agenda for the Rights of the Child (COM(2011) 60 final).

1.3

Advertising which wrongfully uses children for purposes unrelated to matters which directly concern them is an affront to human dignity and to their physical and mental integrity and should be banned.

1.4

Advertising aimed at children involves additional risks depending on the age-group involved, with harmful consequences for their physical, mental or moral health. Particularly damaging are incitements to over-consumption, leading to debt and the consumption of food or other products which are harmful or dangerous to their physical and mental health.

1.5

In more general terms, the particularly violent, racist, xenophobic, erotic or pornographic content of some advertising can have irreversible effects on children's physical, mental, moral and civic development, triggering outbursts of violence or sexual precociousness.

1.6

The EESC considers that these issues need to be analysed very thoroughly and placed within an EU framework, in keeping with the principles of subsidiarity and proportionality. This is not just a matter of safeguarding fundamental rights: it is also necessary because differing national regulations jeopardise the smooth operation of the internal market. The EESC therefore recommends that a universal minimum age for advertising specifically aimed at children be set at the European level.

1.7

The EESC considers that special emphasis must be placed on empowering, informing and educating children, from a very young age, about the proper use of information technologies and about how to interpret advertising messages. These subjects should be included in school curricula at all levels. Parents should also be equipped to help their children to interpret advertising messages.

1.8

The EESC believes that the public in general and, more particularly, families and teachers, should also receive information and training to help them protect children more effectively.

1.9

The EESC calls on advertisers and sponsors, using both self-regulation and co-regulation initiatives (not only those already adopted but also ones to be promoted) to adopt and apply the highest levels of protection of children's rights and to see that they are enforced.

1.10

The EESC considers that the Community legal framework does not meet current needs for protecting children's rights with regard to advertising messages, and specifically those conveyed by audiovisual media, on the internet and via social networks. It urges the Commission to give urgent thought to the need to adopt more restrictive, cross-cutting measures to effectively guarantee these rights.

1.11

The EESC calls on the European Parliament and national parliaments to resolutely continue their tradition of upholding the rights of children in this special field.

2.1

The EESC advocates a social market economy which is properly regulated so as to promote healthy and fair competition and a high level of consumer protection, with a view to completing an internal market as a means of improving Europeans' living and working conditions, while showing due regard for the values of human dignity, freedom, democracy, equality, the rule of law and respect for human rights.

2.2

In this context, the EESC acknowledges that advertising, in all its forms, plays a major role, which has been well summarised by the International Advertising Association (IAA), whose viewpoint highlights in particular its role in disseminating innovation, encouraging creativity and entertainment, providing incentives for competition, and extending choice. The EESC also recognises that advertising acts as an important source of information and clarification to consumers, which is the justification and basis for its regulation at the Community level.

2.3

In an opinion of this nature and with this goal in mind, it would make sense to dedicate a section to the influence of the media in general, especially television, the internet and social networks, which have become the most important vehicles for advertising messages to children and young people as both users and mere passive viewers. It would also be useful to study the way in which children's behaviour in relation to social media varies according to their age and social background, including the well-known phenomenon of children choosing "idols" and "social behaviour patterns" or "lifestyles" as definers of personality, which are exploited by advertising methods (2). Nevertheless, due to space constraints, these will have to be taken as read, with all aspects of this issue being well-known and agreed on, specifically as regards the role that the media referred to above play in informing, training, educating and entertaining young people and the time young people spend on them. Some of these aspects have been or are currently being addressed in other EESC opinions (3).

3.1

With regard to advertising that uses children, it is worth highlighting the aspects of human dignity and the rights of the child, expressly enshrined in a number of international conventions and by the European Union, in particular in provisions of the Charter of Fundamental Rights (Articles 1 and 2c) and especially Articles 24 and 32.

3.2

The EESC considers that Community-level harmonisation is needed to ensure a universal ban on advertising that makes undue and improper use of images of children in areas not directly linked to them.

4.1

Up to a certain age, children do not filter advertising, especially when the message is overblown and the same advert is repeated again and again. Children tend to accept all messages as truthful and can thus be persuaded to become compulsive consumers. This effect becomes stronger the more disadvantaged a child's socio-economic background. The messages and warnings contained in advertising are not understood by children and cannot be considered to play any preventive or dissuasive role.

4.2

What is more, the perception of advertising varies from one age-group to another. Up to the age of five, children are incapable of understanding the difference between scheduled programmes and advertising; even after that age, they still do not recognise advertising's persuasive role. This skill only develops around the age of eight and even then, not in all children. However, this still does not mean that they are able to recognise messages as one-sided, emphasising the positive aspects of the product in question and ignoring the more negative ones.

4.3

When older children view advertising as a piece of entertainment, its impact is greater, and their greater ability to process advertising messages does not necessarily render them immune to advertising and its intentions because other, more sophisticated and equally effective, persuasion techniques can be used to influence their behaviour.

4.4

Developing children's cognitive and interpretational skills by means of media education programmes enables them to interact more effectively with advertising. However, greater media literacy and better understanding of advertising on the part of both parents and children are not enough to counter the harmful effects of advertising aimed at children. It is essential to prepare children for their future role as consumers by focusing on media literacy and empowerment from the earliest age. This does not, however, solve the immediate problem of the overblown, repeated nature of advertisements, nor can it reach all children, especially those from more disadvantaged socio-economic backgrounds and those most affected by the harmful effects of advertising.

4.5

Studies show that the mediating role of the family is important in mitigating the effects of advertising. Nevertheless, children, including very young children, increasingly have access to a television and internet in their bedroom, making this a solitary and unsupervised activity. Another factor that increases children's exposure to advertisements and marketing techniques is the growing presence of the internet in the daily habits of even the youngest children. As is rightly pointed out in the draft EP report currently being drawn up, the internet is young people’s companion, often more than the family, school and friends.  (4) Recent studies, such as Kids online, show that 38 % of children between the ages of 9 and 12 already have an online profile, and this figure rises to 78 % for 13-16 year olds. Many brands of toys and games have websites on which children can play and have fun online, but where they are also targeted by persuasion and brand loyalty strategies.

4.6

With regard in particular to incitement to excessive consumption leading to over-indebtedness, some marketing messages aimed at children can stimulate consumption habits marked by excess, creating artificial desires that do not match real needs and generating a false concept of "happiness". Statistics show that 54 % of adolescents feel pressurised to buy certain products purely because their friends have them; in other words, consumption ultimately becomes a factor for social inclusion.

4.7

There is a causal link between exposure to certain advertisements and pestering parents to buy things. Family conflict linked to exposure to advertising and demands to buy things occur in all families, but especially in those with the lowest socio-economic status, whose children spend most time in front of the television. Due to a lack of finances or a lesser ability to discuss matters, low-income families ultimately pay the highest price for advertising.

4.8

Consumerism stimulated by advertising also has the effect of drawing large numbers of children and young people to certain brands, which creates difficult situations for those who do not have access to the same products. One such situation is known as "brand bullying" in schools, which severely affects children who do not use certain brands; it can create behavioural problems or great personal unhappiness, sometimes driving them into situations of exclusion, violence and suffering that can in turn lead to crime in the form of petty theft or robbery.

4.9

As regards advertising that encourages the consumption of unhealthy food or other products that are harmful or dangerous to physical and mental health, we should emphasise the influence that children have on food-purchasing decisions, especially on the preference for ready-made dishes or fast food. The draw towards poor eating habits is a constant factor in advertising aimed at children. Obesity among children is already a huge problem. According to Consumers International, one in 10 children worldwide is overweight or obese; 22 million children below the age of five are now classified as overweight, and the main cause is the consumption of highly-processed products that are rich in sugars and fats.

4.10

The figures for the exposure of children to food-related advertising, especially in children's programmes, are high, and have been rising with children's growing use of television, the internet and social networks. Furthermore, the nature of adverts has changed, as they now contain more sophisticated product-marketing techniques which make them more persuasive (5).

4.11

Advertising can also have implications for eating disorders such as anorexia and bulimia. Children and adolescents are exposed to the body types and appearances of the young people featured in advertisements. The impact on young people, especially girls, of a slim body type promotes an ideal of beauty that encourages eating behaviour that can put lives at risk.

4.12

Indeed, the American Psychological Association considers that advertising aimed at children under the age of eight should be restricted (or banned altogether) given the inability of children of that age to process the persuasive intent of adverts. The aim of this ban would be to limit the damaging effects of advertising on the promotion of unhealthy eating habits, on conflict between parents and children over demands to buy products that are advertised, and on exposure to violence (6).

4.13

The Committee considers that these concerns, which are already covered by legislation in some Member States (7) and non-European countries, should be incorporated at EU level, setting a minimum age for advertising specifically aimed at children, as suggested in the report by the MEP Kyriacos Triantaphylides (8) and reaffirmed in the EP Resolution of 22 May 2012 (9).

5.1

In terms of advertising that can seriously affect the mental and moral development of children, even when not specifically aimed at them, the most significant is advertising that encourages violence or certain types of violent behaviour, such as advertisements for toys or games that glorify violent behaviour.

5.2

Reliable studies show the damaging effects of exposure to violence in certain advertisements broadcast by audiovisual media, particularly when it promotes aggressive behaviour, greater receptiveness to violence and increased hostility. Mental health itself can be affected by this consumption of violent content, leading to anxiety, fear, sleep disturbance and hyperactivity.

5.3

Celebrities are increasingly used in advertisements for products that could damage health, such as alcohol or tobacco. Associating a lifestyle deemed to be attractive with such products stimulates the desire to use them and creates a positive perception of them.

5.4

Children's normal psychological and moral development is also affected by advertising containing erotic or pornographic content that encourages perverse, perverted or excessive sexual behaviour. A great deal of advertising is sexist and sexual in nature, and uses women as objects of desire, often in an inferior or subservient, not to say subjugated, position. Also, the excessive sexual charge or erotic, if not pornographic, content lead to the early sexualisation of children. Despite the fact that certain well-known brands have been forced to withdraw advertising that contributes to the hyper-sexualisation of children, and despite civil society's outrage at the abuse of images of minors' bodies in advertisements, there is no clear legal European-level definition of such situations.

5.5

Although this area is regulated in a number of Member States (albeit in highly different ways, which prevents the smooth operation of the internal market and cannot be justified by fundamental cultural reasons), the Committee considers that it is also worthy of consideration at Community level.

6.1

Given the current framework, it must be stated that national legal provisions and the procedures regarding children adopted by professionals in the field of advertising (meaning commercial communication in the broadest sense of the word) are anything but uniform in the different Member States.

6.2

For its part, the Community legal framework is unnecessarily complex and confusing, and in most cases is differently transposed and implemented in the Member States. The Commission itself recognises this in its Communication entitled A coherent framework for building trust in the Digital Single Market for e-commerce and online services  (10), in its report on Protecting children in the digital world  (11) and in the European Strategy for a Better Internet for Children  (12). Most Member States have confined themselves to a minimalist transposition of the relevant Community directives, while others (13) apply stricter standards, which even ban advertising targeting minors (14).

6.3

Rightly, none of the provisions contained in Community legislation considers that in order to protect minors and human dignity, any "prior checks" should be carried out, in line with the fundamental principles of freedom of expression, as firmly established by the European Court of Human Rights with regard to the European Convention on the matter.

6.4

The fundamental error lies, however, in the Council Recommendation of 1998 on Achieving a comparable and effective level of protection of minors and human dignity, whose first stated concern is the competitiveness of the European audiovisual and information services industry. The recommendation treats action on audiovisual or "online" content that could be harmful to minors or human dignity as falling outside the legislative powers of the European Union (15) and ultimately views these aspects as a matter of "taste and decency" that does not fall within the scope of Community regulation (16).

6.5

In terms of what is universally mandatory, Member States are only required to ensure that television programmes (which should be understood to include commercial communications) do not include any programmes which might seriously impair the physical, mental or moral development of minors, in particular programmes that involve pornography or gratuitous violence, unless preceded by an "acoustic warning" or accompanied by a "visual symbol", except where it is ensured, by selecting the "time of the broadcast" or by "any technical measure", that "minors in the area of transmission will not normally hear or see such broadcasts".

6.6

Current legislation has abandoned the restrictions on inserting adverts, where this does not seriously impair the integrity of programmes, on the grounds that there are now "increased possibilities for viewers to avoid advertising". This legislation takes no account of the specific characteristics of the child, which it deems to be a passive viewer.

6.7

The only explicit Community-level prohibitions in place today apply to tobacco products, medicinal products and medical treatment available only on prescription, and to "surreptitious" or "subliminal" advertising. However, this ban does not extend to "product placement" (which nevertheless should "in principle, be prohibited") in cases "where the viewer is adequately informed of the existence of product placement". Moreover, there are "strict criteria" for the advertising of alcoholic beverages.

6.8

Only in this last regard is it stated that advertising should not specifically target minors. In all other aspects relating to harm to the physical, mental or moral development of minors (such as directly inciting children or indirectly inciting their parents to purchase goods or services that are advertised, taking advantage of their lack of experience or their credulity, or advertising "included in children’s programmes, of foods and beverages containing nutrients and substances with a nutritional or physiological effect, in particular those such as fat, trans-fatty acids, salt/sodium and sugars"), the rules in force merely offer general recommendations or make reference to "codes of conduct".

6.9

It should also be pointed out that although the Directive on unfair commercial practices contains a provision on unfair practices targeting "a clearly identifiable group of consumers who are particularly vulnerable" specifically because of "their age or credulity", it has not been interpreted as prohibiting the above practices and nor has it been transposed or implemented to this effect in the Member States (17).

6.10

Apart from these EU law provisions, other traditional instruments establish core principles that in turn underpin the latest developments in fundamental EU legislation (the Lisbon Treaty and the European Charter of Fundamental Rights).

6.11

At the same time, both internationally and in the different Member States, professionals in the field – and in particular, the EASA (18) – have developed a set of provisions for self-regulation of their commercial practices that clearly demonstrates their commitment to protecting children. This does not remove the need, stated in a number of international and Community bodies, to guarantee a high level of respect for children and their protection in order to ensure their physical, mental and moral development, with concern for their own interests, their wellbeing and the preservation of the family environment and ties.

7.1

The market for advertising and marketing in Europe is highly competitive, is dependent on the whims of fashion and is particularly vulnerable to the effects of the economic and financial crises. Major differences in national regulations in the field of advertising can not only influence results, but can also form a barrier to its growth in the internal market and be a source of discrimination and less fair competition. In particular, advertising aimed at children and young people is booming, but the significant differences in national regulations and divergent requirements mean that advertising agencies do not operate on a level playing field; this leads to higher costs as a result of having to adapt their campaigns to meet different legal obligations and requirements. These differences also encourage agencies to adopt less scrupulous competitive practices, in an attempt to circumvent these problems and win market share. Legislative harmonisation that imposes similar conditions across Europe, completing the internal market in this area, could make a significant contribution to creating a more transparent market in which all advertising agencies are able to carry out their business on the basis of their skills and capabilities with the aim of meeting consumer demand effectively, rather than taking advantage of differences in national legislation, to the detriment of healthy and fair competition.

8.1

To date, the Community directives that have regulated advertising at EU level have commonly taken as their legal base the treaty provisions concerning completion of the internal market, today Articles 26 and 114, albeit heavily modified. This is certainly a major concern, but should not be the sole concern. Other Community initiatives, whose aims more specifically target television broadcasting, instead took as their legal base the text that at the time applied to the right of establishment and to services, now corresponding, albeit with substantial changes, to the current Articles 49 et seq. and 56 et seq. Lastly, in more recent initiatives on child protection and child pornography, but still prior to the current Lisbon Treaty, the legal base used was taken from the provisions referring to cooperation in criminal matters.

8.2

It is worth recalling that the current Lisbon Treaty enshrined substantial changes in all of these aspects and offers a range of new possibilities for Community action, which we must be able to interpret and implement. The most important innovation was the incorporation of the European Charter of Fundamental Rights into primary EU legislation, followed by the change to the legal nature of cooperation in criminal and civil matters and lastly, the changes made to a number of the Treaty's provisions, such as those concerning completion of the internal market, consumer protection and respect for human dignity. The Commission also recently based its proposed data protection regulation on the European Charter of Fundamental Rights and the abovementioned Lisbon Treaty provisions.

8.3

The issue of advertising that targets children and young people is, first and foremost, an issue of citizenship and the protection of fundamental rights; Articles 1, 3, 24, 33 and 38 of the Charter, as referred to above, provide a substantive legal base that amply justifies the need for Community action. To these we should definitely add Articles 2, 3(5) and 6 TEU and Articles 4, 9 and 10 TFEU.

8.4

In this field, in addition to the Member State governments, whether in the Council or in the area of enhanced cooperation (Article 20 TEU), national parliaments also have an important role to play under the terms of Article 12 TEU and are called on to shoulder this responsibility.

8.5

Completion of the internal market is also one of the most important goals in this field, hence the coverage of Article 3(3) TEU and Articles 26 and 114 et seq. TFEU. Furthermore, Articles 12 and 169 TFEU open up new possibilities for consumer protection. With regard to procedural aspects, Articles 67 et seq., especially Articles 81 and 82 TFEU, provide the bases for a civil and criminal framework that will help complement the legal framework for child and youth protection in this field.

8.6

Lastly, the Community-level approach to this matter adheres to the principles of subsidiarity and proportionality (Article 5(3) and (4) TEU), in that its goal for the cross-border dimension cannot be achieved to a sufficient degree by the Member States within their national systems alone. The objective of the initiative could therefore be better achieved by action at EU level, in accordance with the subsidiarity principle. Furthermore, the scope of the initiative should be confined to aspects which pose specific practical problems. It should not address aspects that can be more appropriately regulated by national legislation, thereby giving due regard to the principle of proportionality.

15.11.2012   

EN

Official Journal of the European Union

C 351/12

—

it is important for efforts to combat discrimination to be integrated into all spheres of activity and incorporated into both the EU budget and national budgets;

—

there is a need for indicators to gain information about the situation;

—

the implementation of non-discrimination should be connected with the Europe 2020 strategy;

—

appropriate and effective enforcement and monitoring mechanisms should be identified at both European and national level;

—

there is a need for more and better jobs in order to safeguard and improve the economic independence of vulnerable groups;

—

it is important for responsibility for families and households to be shared fairly between the sexes, and for social security entitlements to be individualised;

—

institutional structures need to be developed, for example to set up a European Disability Committee;

—

there is a risk that the economic and social crisis will increase intolerance, xenophobia, racism and homophobia throughout Europe;

—

integration is a complex, long-term social process, with many dimensions and many stakeholders involved, particularly at local level.

3.1.1

The Fundamental Rights Agency published two reports in 2009 (8) analysing the situation for LGBT people; some of the agency's conclusions are set out below. One initial conclusion is that there is a hierarchy of grounds for discrimination, with protection against discrimination on grounds of sex, race and ethnic origin being stronger than protection against other forms of discrimination. However, Member States are increasingly tending to give all discrimination grounds the same level of protection.

3.1.2

According to the FRA, 18 of the EU's Member States have gone beyond the minimum requirements in implementing the Employment Equality Directive with regard to discrimination based on sexual orientation. The majority of Member States have therefore introduced legislation providing protection against discrimination based on sexual orientation outside the area of employment. Around 20 Member States have an authority responsible for addressing discrimination based on sexual orientation.

3.1.3

The FRA's reports also discuss freedom of movement for LGBT people, which is an important element of the single labour market in the EU. In this connection, it is worth noting that family law is a national legislative competence, which means that different Member States have different rules regarding same-sex couples. Countries also have different traditions in terms, for example, of attitudes towards same-sex marriage and partnerships, but this means, among other things, that problems may arise when people exercise their rights with regard to the free movement of persons.

3.1.4

The FRA notes that same-sex couples encounter significant barriers in exercising their rights in terms of freedom of movement, whether they are married, in a registered partnership or in a long-term stable relationship. The agency points out that, in many circumstances, this constitutes direct discrimination and that Member States' obligations under the Free Movement Directive (9) should be clarified.

3.2.1

The Court of Justice has heard two cases relating to discrimination based on sexual orientation: Römer and Maruko. In the Römer case, the court held that the Employment Equality Directive precluded a pensioner who had entered into a registered life partnership receiving a supplementary retirement pension lower than that granted to a married pensioner, and that there was direct discrimination on the ground of sexual orientation because, under national law, the people concerned were in a legal and factual situation comparable to that of a married person as regards pensions.

3.2.2

In the Maruko case, the court likewise held that the directive precluded legislation under which, after the death of his life partner, the surviving partner did not receive a survivor's benefit equivalent to that granted to a surviving spouse. However, it also held that it was for the national court to determine whether a surviving life partner was in a situation comparable to that of a spouse. In addition, it noted that there were significant discrepancies within the EU and that there was a general lack of equivalence between marriage and other forms of legally recognised relationship.

3.3.1

Difficulty of being open about sexual orientation in the workplace: Studies show that LGBT people are often "invisible" on the labour market, most often due to fear of victimisation. In many cases they also avoid socialising with colleagues to avoid being "outed". Above all, people were found to be afraid of informing superiors in the workplace of their sexual orientation. Openness is significantly below average in certain sectors, such as the military and the church.

3.3.2

Specific problems make work difficult: LGBT people on the labour market are in a different position from other vulnerable groups because openness about their sexual orientation impacts their working life. It is common for LGBT people to develop strategies to avoid exposing their sexual orientation, such as changing the subject or leaving a conversation in the workplace. Studies show that these constant efforts to negotiate the workplace have an impact on health and productivity. The discrimination to which lesbian, gay, bisexual and transgender people are exposed in the EU leads to shame-based emotional exclusion, which has consequences both for the individual and for labour-market participation. In the EESC's view, the EU's various institutions need to work actively to combat the exclusion this entails.

3.3.3

Problems accessing labour market rights: When people are the targets of discrimination on the basis of their sexual orientation, it is important for them to have access to complaint mechanisms and to a national authority that handles complaints regarding such discrimination. Many Member States simply do not have any such authority.

3.3.4

Unwillingness to make complaints: The number of documented cases of discrimination on the grounds of sexual orientation is remarkably low. This is probably due to LGBT people being unwilling to come out publicly, and possibly to a lack of awareness of their rights. There is also a risk that they could lose their job if they complain. In some cases it is important for people who make complaints to be protected by society to counteract the negative consequences of complaining.

3.3.5

Lack of knowledge: A Eurobarometer survey showed that there were shortcomings in people's awareness of anti-discrimination legislation. Almost half (45 %) of EU citizens are unaware that there are laws against discrimination on the grounds of sexual orientation when appointing a new employee. An ETUC study also showed that there was a lack of awareness among trade unions regarding LGBT policies and activities. This lack of awareness of employment rights is reflected in a general lack of information and data about the situation and experiences of people with different sexual orientations. Studies found that levels of awareness regarding sexual orientation and gender identity in the workplace are very low. This general lack of awareness makes it very difficult for people with different sexual orientations to discuss gender identity or discrimination based on sexual orientation with employers and trade unions. There is therefore a case for working to raise awareness, particularly where it is currently low, to improve knowledge of EU citizens' rights.

3.3.6

Legal protection and other measures to reduce discrimination: In some countries, the introduction of legal protection and better support for equal rights at national level has helped to increase public awareness more generally, which has also had a positive impact on trade unions and employers. The FRA's study makes little mention of employers' responsibility, which highlights the important of the responsibility of management. Diversity management and an open culture have a positive impact on workplaces with regard to LGBT people. Diversity management may not necessarily prevent discrimination, but it is an important first step within an organisation.

3.3.7

Extent of discrimination: A number of studies have been carried out to map the extent of discrimination against LGBT people in the workplace. They have concluded that up to half of this group are not open about their sexuality at work, and that between a third and half of those who are open encounter direct discrimination or insulting comments and prejudice in the workplace.

3.3.8

A number of projects have been undertaken within the EU involving employers, trade unions and the voluntary sector; the Commission provided financial support for these projects, which boosted their legitimacy. In France, employers and trade unions in one sector have concluded an agreement on equal rights for same-sex families. The Swedish trade union confederation Vision provides training on LGBT issues with the aim of raising awareness about discrimination in the workplace. Experience has shown that it is perfectly possible to work together to change the situation on the labour market for people with a different sexual orientation. The Committee notes with regret that activities of this kind are a rarity and it therefore calls on the European Commission to popularise best practice and on the social partners to be much more active in combating discrimination against LGBT people in the workplace.

15.11.2012   

EN

Official Journal of the European Union

C 351/16

1.6.1

At EU level policy-makers should:

1.6.2

EU Member States should:

1.6.3

Local authorities and civil society, including the social partners, should:

3.1.1

The EU Labour Force survey (7) shows that the trend of migrant entrepreneurship varies across the EU, with the share of migrant entrepreneurs in total employment being 1.5 to 2.9 percentage points higher than natives in the United Kingdom, France, Belgium, Denmark and Sweden. However there is a lower share of migrant entrepreneurs when compared with natives in Portugal, Spain, Italy, Greece, Ireland, Germany and Austria.

3.1.2

Regionally there is a higher overall rate of self-employment (native and migrant) in southern Europe and central and eastern Europe. However, in central and eastern Europe, migrants tend to have a higher self-employment propensity than the natives, while the opposite is true in southern Europe.

3.1.3

This over-representation of migrants in self-employment in Poland, the Slovak Republic, the Czech Republic and Hungary is partly due to relatively flexible visa regulations for migrant entrepreneurs and the employment situation in these countries. Southern European countries’ lower rates of migrant entrepreneurship may be a consequence of the fact that migrants in these countries may not have had time to build the necessary human, physical and social capital to start a business as they might not be fluent in the native language, or may have difficulties getting their qualifications recognised.

3.1.4

Data on the number of new entrepreneurs in a given year also suggests that migrants tend to be more entrepreneurial than natives. During the period 1998-2008, the average annual number of new migrant entrepreneurs doubled in Germany (to over 100 000 per year) and in the United Kingdom (to almost 90 000 per year). In Spain and in Italy the average annual numbers increased by 6 times (to over 75 000 per year), and 8 times (to 46 000) respectively. In France there has been a small increase (to 35 000) over the same period (8).

3.1.5

In addition, migrants are more entrepreneurial in relative terms with respect to their population than natives. For example in the UK, while migrants represent 8 % of the UK population, they own around 12 % of all UK SMEs.

3.1.6

This finding is consistent with a recent US study that reveals that the immigrant share of small business owners is 18 %, compared with their proportion of the overall population of 13 %, and of the labour force of 16 % (9).

3.2.1

While transitions into entrepreneurship from one year to another are higher among migrants, transitions out are also higher. This lower survival rate can indicate that self-employment is a mechanism to move into wage employment or it can indicate a higher failure rate of migrant firms. For example, in France, only 40 % of the firms owned by foreign nationals were still operating five years after their creation compared with 54 % for French nationals (10). The OECD study (11) found that even after controlling for qualifications, experience and other factors, migrant businesses are 27 % less likely to survive relative to native businesses.

3.3.1

The range of activities that migrant entrepreneurs undertake in their host countries is as wide as that of natives. This transformation, from businesses that cater mainly to populations from their ethnic enclaves, is due partly to the increasing educational attainment of many migrants, as well as shifts in the economic structures of post-industrial societies.

3.3.2

In Europe, although a high proportion of foreign-born entrepreneurs work in sectors more traditionally associated with migrant businesses (i.e. wholesale and retail trade), many work outside the traditional ethnic business sectors, with almost 18 % of migrant entrepreneurs in the construction sector; around 8 % in the professional, scientific and technical sector; around 6 % in manufacturing and another 6 % in human health and social work.

3.4.1

The general profile of migrant and native entrepreneurs is similar in that they tend to be skilled and male, with more than three out of four being over the age of 35. Migrant and native entrepreneurs are on average older than wage and salary workers. This result might be explained by the need to accumulate enough social and physical capital, as well as experience, before being able to start a business.

3.4.2

Migrant entrepreneurs have a higher average educational level than their native counterparts with around 30 %-40 % of migrant entrepreneurs having a tertiary education.

3.4.3

Almost two-thirds of migrant entrepreneurs have been in the receiving country for more than ten years compared with just above 50 % for migrant wage earners.

3.4.4

Migrants from different regions of origin have different propensities to become entrepreneurs, with Asian migrants having the highest propensity and Latin-American and African migrants the lowest. Differences in education and wealth may explain an important part of the differences in entrepreneurship behaviour between migrant groups. An additional explanation is that some origin countries traditionally have a higher share of entrepreneurs in their economies, and individuals that migrate from such countries are more likely to establish a business in the recipient country.

3.4.4.1

It should be noted that the migrant experience by region of origin isn't homogeneous. For example, figures from the UK indicate that if the employment rates of its Pakistani migrant community matched those of their Indian counterparts, the proportion of male and female workers in this group would rise by 24 % and 136 % respectively, an increase of some 96 000 people in work.

5.1.1

The EU Labour Force Survey (1998 – 2008) highlights the positive contribution of migrant entrepreneurs to employment, even though most entrepreneurs (native and migrant) employ only themselves.

5.1.2

They create on average between 1.4 and 2.1 additional jobs. However, the comparisons with native entrepreneurs suggest that migrant entrepreneurs create relatively fewer jobs. The exceptions to this general observation are the Czech Republic, Hungary, the Slovak Republic and the United Kingdom, where migrant entrepreneurs seem to create more jobs than native entrepreneurs.

5.1.3

This contribution to overall employment has been increasing over time. From 1998 to 2008, the number of individuals employed by migrant entrepreneurs increased in Spain, Italy, Austria, Germany, and the Netherlands, while in the United Kingdom and France, the contribution to employment has been consistently high. For example, in both 2007 and 2008, migrant entrepreneurs annually employed more than 750 000 individuals in Germany, around half a million in the United Kingdom and Spain, almost 400 000 in France and around 300 000 in Italy.

5.1.4

In relative terms, this contribution to employment is equivalent to between 1.5-3 % of the total employed labour force. The countries where migrants contribute the most to overall employment are Luxembourg (8.5 %) and Ireland (4.9 %). While data limitations do not allow us to establish whether migrants employ mostly other migrants or not, some studies have shown that migrants employ natives as well as other migrants.

5.2.1

Migrant entrepreneurs’ contributions are not limited to job creation, they also contribute to the overall economic growth of the receiving country. It is very difficult to gather true empirical evidence as regards the actual contribution to the EU economy, however, there is data from the UK which shows that their contribution is estimated at GBP 25 billion to the UK economy per year - 6 % of the total SME Gross Value Added (GBP 430 billion in 2007) (14).

5.2.2

This compares with a US study that shows small businesses in which immigrants make up half or more of the owners contribute an estimated USD 776 billion per year – 13 % of total small businesses (USD 6 trillion in 2007).

5.2.3

Another indication is data from France which shows that in 2009, immigrants in France received EUR 47.9 billion from the French state (welfare, housing, education, etc.), but they contributed EUR 60.3bn. In other words, immigrants contributed a net EUR 12.4bn to public finances (15).

5.2.4

The EESC believes that the EU contribution could be higher if migrant entrepreneurs working in the informal economy could be given the support needed to make the transition to the formal economy.

5.3.1

There is also evidence that migrant entrepreneurs help create trade opportunities for the receiving country by lowering trade-related transaction costs with their countries of origin, using their contact networks and knowledge about the markets in their countries of origin. For example in Sweden, 22 % of foreign-owned businesses target their goods and services, at least partially, towards the international market, compared with 15 % of native-owned businesses (16). It has also been shown that a 10 % increase in the migrant stock in Sweden has been associated with a 6 % increase in exports and a 9 % increase in imports on average (17). This finding suggests that migrants can play an important role as facilitators of foreign trade by reducing implicit trade barriers with their countries of origin.

5.3.2

Another example is the UK. Migrant entrepreneurs provide direct access to a growing Diaspora community, with an estimated disposable income in excess of EUR 30 million, as well as opening up new business opportunities in global markets such as India, China and countries in Africa, the Caribbean and Latin America.

15.11.2012   

EN

Official Journal of the European Union

C 351/21

1.1

The EESC already issued an opinion on Domestic violence against women  (1) in 2006, highlighting civil society's concern about this matter. The recommendations set out at that time continue to hold true and are, therefore, not repeated in this opinion.

1.2

In its capacity as representative of organised civil society, and being aware that gender-based violence - including domestic violence - is a matter which concerns us all, the EESC reaffirms its commitment to combat this scourge in every way possible, weighing up a number of options, including that of holding a biennial debate on the issue.

1.3

The EESC recommends that European institutions and EU Member States:

2.1

Violence against any individual is an attack on their dignity, on their physical and psychological integrity and human rights and on the principles of a democratic society.

2.2

Since States have an obligation to respect, protect and promote their citizens' rights, they should invest substantial public resources in specialist services and staff able to fulfil this obligation.

2.3

Public violence is condemned in society and society supports government measures taken to clamp down on and punish those perpetrating such violence.

2.4

However, there is another – more silent – form of violence, perpetrated in people's homes and affecting the victims in a possibly more brutal manner: domestic violence.

All members of a family may be occasional or constant victims of various types of violence which can lead to their death.

2.5

While all of these types of violence warrant attention, concern and action on the part of the authorities, the fact is that the group most systematically affected by this are women – domestic violence is one of the main causes of female mortality. This opinion is therefore focusing on domestic violence against women.

2.6

The European Union defines violence against women as being: "any act of gender-based violence that results in, or is likely to result in, physical, sexual or psychological harm or suffering to women, including threats of such acts, coercion or arbitrary deprivation of liberty, whether occurring in public or in private life" (3).

2.7

Despite efforts over the last few decades by public authorities and various sections of society, organised or not, this form of violence is still viewed as a private problem when, in truth, it is a problem for society as a whole.

2.8

Domestic violence is a crime that must be sanctioned by law. The EESC acknowledges the efforts made by different countries in the EU to impose tougher measures on perpetrators. Nevertheless it is also important to identify the underlying causes of this phenomenon and the strategies needed to eradicate it, including a better understanding of the phenomenon by men.

2.9

Furthermore, the economic crisis is seriously harming social policies in many EU countries. Basic public services such as health, education and social support are being cut back at a time when families – particularly women – need them most. Special help-lines for women are being shut down, as are shelters for battered women; the budgets of national gender equality departments are being slashed and prevention and awareness-raising campaigns in the media are being cut back too.

2.10

The persistence of gender stereotypes and a patriarchal society, in addition to the economic inequalities and discrimination against women in jobs, wages and access to other economic resources, together with a lack of economic independence, limit women's capacity to act and make them more vulnerable to domestic violence.

2.11

The current economic crisis and the policies that have been pursued supposedly to counter it, together with the process of liberalising economies and privatising the public sector, not only reinforce the gender-based division of labour but also increase inequalities, exacerbating the conditions which give rise to violence.

2.12

The World Health Organization (WHO) (4) has recognised the damaging effect of globalisation on social structures. Anarchic globalisation may give rise to worse forms of violence against women, including trafficking of human beings.

2.13

Women belonging to minority groups, female migrants, women in poverty living in rural or remote communities, women serving a prison sentence, women in institutions, women with mental and physical disabilities and elderly women are more at risk of experiencing violence.

2.14

This own-initiative opinion will seek to take stock of domestic violence against women in Europe, provide an overview of the measures taken to date and spark greater awareness of this problem in society.

2.15

As the voice of organised civil society, the EESC is willing to set up, in conjunction with organisations concerned with this type of violence, a forum for discussing proposals to eradicate such violence and to share examples of good practice that could lead to effective prevention measures.

3.1

In 2011, the Council of Europe adopted a convention on preventing and combating violence against women and domestic violence (5). This is the first legally binding international instrument which creates a global legal framework aimed at preventing violence, protecting victims and convicting the perpetrators. Its aim is to alert people to the fact that there should be greater equality between men and women, because violence against women is rooted deeply in gender inequality and perpetuated by a culture that is patriarchal and indifferent to this situation.

3.2

The convention takes into account all types of violence (physical, psychological, sexual harassment, forced marriage, female genital mutilation, harassment, sterilisation and forced abortion), irrespective of the victim's age, ethnic or national origin, religion, social origin, immigrant status or sexual orientation.

3.3

To date, this convention has only been ratified by one (6) of the 20 countries that have signed it (7), some with reservations (Germany, Serbia and Malta). The EESC calls on the European Union and all of its Member States to sign, ratify and implement the Istanbul Convention as soon as possible.

4.1

45 % of women in the EU say they have suffered gender-based violence at some point. Between 40 % and 45 % say they have suffered sexual harassment at work. It is estimated that in Europe, seven women die every day as a result of gender-based violence (8).

4.2

This phenomenon, moreover, has a major economic impact: it is estimated that violence against women in the 47 member states of the Council of Europe has an annual cost of at least EUR 32 billion.

4.3

A survey carried out by Euro barometer in 2010 showed that the public (98 % of those surveyed) is largely aware of this phenomenon and that it is prevalent in society (one in four people said that they knew a woman who was a victim of domestic violence and one in five said they knew a perpetrator of domestic violence).

4.4

As early as 1980, the second World Conference on the Status of Women established that violence against women was the crime glossed over the most in the world. Thirteen years later, the World Conference on Human Rights in Vienna recognised that women's rights were human rights. Member States of the European Union undertook to comply with the fundamental objectives of the 1995 Peking Action Programme.

4.5

In the final declaration of the second European Summit of Women in Power (Cadiz, March 2010) (9), 25 ministers and numerous political leaders from throughout the European Union recognised that there was still much to be done before gender-based equality was achieved and that violence against women was a persistent problem and a serious violation of human rights. It stated that sexist stereotypes continued to generate discrimination and warned that the younger generations were copying sexist behaviour.

4.6

The European institutions have issued a variety of documents containing analyses and proposals for action, some of which are set out below:

4.7

On the other hand, Member States – although not on a widespread basis – have been producing legislation aimed at criminalising domestic violence, taking more drastic measures against perpetrators, making domestic violence a public crime, etc.

4.8

Despite the fact that there are still insufficient reliable and comparable statistical data on domestic crime at both national and European level, the figures available are alarming enough for there to be no doubt as to the magnitude of the problem (10).

4.9

Despite the figures and more rigorous legislation, there is still a widely held view that we are living in an egalitarian society, and this view could undermine the debate not only on domestic violence but also on other types of violence and inequalities between women and men in terms of pay differences, promotions at work, etc.

4.10

One type of violence that is often overlooked, because it is invisible to the outside world, is psychological violence. It is time to break the silence on this issue and acknowledge that psychological violence is a breach of human rights, which should be incorporated into legislation on gender-based violence.

4.11

Women who survive psychological violence are often severely traumatised and need holistic, multidisciplinary support in a secure environment for recovery. Having been forced to live in total social isolation, without being able to provide tangible proof of violence against them, they fear that no one will believe them. Their recovery is dependent on care providers believing what they have to say.

4.12

Domestic violence affects not only its direct victims but also those who witness it or who are aware of it. This holds particularly true of children, whose emotional fragility makes them especially vulnerable, with the effects potentially haunting them for the rest of their lives.

4.13

Although domestic crimes are not confined to attacks on women, the question is why other crimes committed in the home environment, such as paedophilia (90 % of cases being perpetrated by family members), are deemed to be loathsome, and yet in domestic violence cases, we still try to look into the reasons which lead the perpetrator to commit such crimes.

5.1

It is important to answer the fundamental question as to why these crimes are, in many cases, deemed to be socially excusable and why very often the reason for the violence is placed at the door of the woman who has been attacked. The cultural and social reasons frequently given for such crimes, in addition to being wrong, merely help maintain the status quo.

5.2

The idea that domestic violence is rooted in antiquated cultures and traditions is based on the incorrect presumption that culture is a static set of beliefs and practices. On the contrary, culture is being shaped and reshaped constantly. Precisely because culture is heterogeneous, incorporating competing values, it has the capacity to evolve.

5.3

Culture is intimately linked to the exercise of power: standards and values acquire authority when those parties defending them hold power or positions of influence.

5.4

Women are also protagonists here, influencing the culture in which they live. Their participation in society and in culture is vital for transforming mentalities, practices and customs which are pernicious to their image and their circumstances.

5.5

Hence the importance of discussing the under-representation of women at different levels of power: as long as this question is not properly resolved and women are not adequately represented economically, socially and politically, in keeping with their number and their skills, the problem of violent acts committed against women will be difficult to solve or solved far too slowly. Although public policies to counter gender-based violence have an important role to play, the traditional image of women's role in society will only change when women have access to power on an equal footing with men.

5.6

The gender-identification models that have for centuries established passivity, submission and obedience as female virtues and aggression, strength and action as male virtues have constructed a type of personal relationship that has for centuries placed women in a position of inferiority and dependence.

5.7

Relationships based on identity-giving models that require one partner to submit to the other are no longer acceptable and men and women should question their stance on such models. This questioning should be underpinned by the affirmation of values such as freedom, independence and personal fulfilment.

5.8

In many cases of femicide (11), a large proportion of the victims had already reported acts of violence or threats. This demonstrates the importance of preventive work. In too many cases precautionary measures which would protect victims from their aggressors are not taken.

5.9

Preventive work can and should include, inter alia:

5.10

Departments specialised in protecting the victims of domestic violence need to have staff with specialised training and enough resources to ensure that measures adopted can be properly implemented; without adequate resources, such measures will not be effective.

5.11

It is very important to create places with multidisciplinary support where women can be heard, understood and believed. Psychological, cultural and religious factors and local customs ingrained in society over centuries, all interact in the phenomenon of domestic violence. There is no one single cause and it cannot be tackled with policy or penal measures alone. Coordinated multidisciplinary support which prevents women being exposed to repeated violence is a fundamental element in combating this phenomenon. Particular attention should be paid to women with disabilities and immigrant women, who are even more vulnerable. This type of support should also always include indirect victims of violence, especially children.

5.12

It is necessary to change the pattern of security which is associated too closely with organised crime, terrorism, attacks on people and goods, and drug trafficking in people's minds, and almost never associated with the dangers that many women risk in their own homes or at their places of work. If we were to incorporate more humanist criteria in the concept of security, attaching priority to prevention, many lives would be saved. New technologies can offer increased protection, such as that provided by electronic bracelets which prevent attackers at large in society to go anywhere near their victims when a restraining order has been placed on them.

5.13

Statistics on domestic violence do not properly describe the phenomenon because they are not able to take into account the real scale of the problem. For this reason it is urgent to standardise the criteria for registering domestic violence so that data can be comparable across Europe.

5.14

Governments should raise the profile of and support (also financially) the work of civil society organisations (women's organisations, human rights organisations, trade unions, etc.), without falling into the trap of controlling them or reducing their autonomy.

5.15

One area of particular importance is education. This can both perpetuate models and discriminatory practices, as well as bring about a transformation of mentalities and individual and collective attitudes. Schools should promote non-sexist and mixed-sex education based on equal rights and opportunities, endeavouring to ensure full personal development that has no connection with stereotypes and gender-determined roles and which rejects any type of discrimination victimising women. Schools can play a part in breaking down stereotyped images of male and female roles as commonly portrayed in the media. Schools can provide an excellent observatory for gender-based violence.

5.16

So that schools can play this valuable role, it is essential that teachers' initial and continuous training incorporate gender-based violence, including domestic violence. There should be constant periodical reviews of curricula and schoolbooks to eliminate all sexist language once and for all.

5.17

Another area of key importance is health. Placing women and teenagers at the centre of health strategies can strengthen the belief that violence against women at home is a risk variable and not an isolated problem.

5.18

Periodic, systematic reviews of registration and notification procedures should be carried out, thereby making sure that professionals are not burdened with excessive red tape and systems which are neither flexible nor sustainable. These procedures should provide an opportunity to register health problems as a risk variable (for example, in family planning and pregnancy consultations), as well as clearly differentiating between urban and rural needs.

5.19

In all sectors relating to the problem of gender-based violence, steps must be taken to ensure that a) awareness-raising campaigns and training are effective and adapted to actual circumstances, with the necessary means and resources available and b) regular mapping exercises are carried out to guarantee that any information provided is correct.

5.20

As regards awareness-raising campaigns and training, it is important to differentiate between awareness-raising (directed at all staff working in an organisation), training (given to everyone in contact with victims, with a view to helping detect the problem) and specific training (which everyone helping the victims should receive). Particular attention should be paid to the training of police officers and judges, given their role in dealing with complaints and prosecuting aggressors. Their approach can help transform a traumatic experience into renewed hope. There is also a need for penitentiary institutions to develop in-prison programmes for female survivors and male perpetrators of gender violence, as well as to make prison staff from all EU Member States more aware of this issue.

5.21

Lastly, by tackling the problem of domestic violence against women as a human rights issue, governments' responsibility for preventing, eradicating and punishing this type of violence is highlighted, as is their duty to report on how to meet these obligations.

5.22

Linking gender-based violence to human rights gives access to an important set of mechanisms for holding countries responsible at international and regional level, from human rights treaties and international criminal courts to the European regional human rights system (European Court of Human Rights – a Council of Europe instrument).

5.23

Tackling violence against women as a human rights question leads us to a holistic, multi-sectoral response, which adds a human rights dimension to the work carried out in all sectors. It forces us to consolidate and speed up initiatives in all spheres for preventing and eradicating violence against women, including in the courts, health, local and regional development policies and humanitarian aid, amongst other areas.

15.11.2012   

EN

Official Journal of the European Union

C 351/27

a)

corruption involving acts condemned by all;

b)

corruption involving acts condemned by only part of the population; and

c)

corruption involving practices extensively tolerated by the population.

—

there is an awareness that corruption is not a "necessary evil" and that there are countries and systems in the world which operate without it;

—

associations are starting to form, not just to bring corruption to light but to explain its economic and social impact to the public;

—

several countries have taken the route of adopting new legislation to combat corruption;

—

people are becoming aware of the need to establish the rule of law, including the fight against corruption and privileges;

—

a number of elected representatives, including minority representatives, are coming onto the scene and putting the fight against corruption on the political agenda;

—

people guilty of corruption have been sentenced in a number of high-profile cases;

—

anti-corruption bodies have been set up in various countries.

15.11.2012   

EN

Official Journal of the European Union

C 351/31

1.1

Due to the personal and societal impact of social networks and their future development and consequences, the EU institutions need to prioritise the adoption of binding and non-binding supranational measures leading to self-regulation or, preferably, co-regulation, in line with the Digital Agenda, to foster responsible and intelligent use within a dynamic Digital Single Market and to prevent the problems associated with its inherent risks. The EESC believes the ideal situation would be to have "model laws" on which to base international regulation. However, until this becomes possible, we need to find an EU-level solution.

1.2

Should measures leading to self-regulation or co-regulation be adopted, they would have to be temporary and their application would have to be evaluated at regular intervals, and if they are not applied, binding measures should be adopted.

1.3

In practical terms, the EESC urges the Commission to incorporate awareness-raising and educational campaigns in the promotion of digital literacy, primarily for the most vulnerable groups, in order to prevent or mitigate the unwanted effects of using social networks inappropriately. There should also be specific courses on parental supervision and mediation to reinforce reporting points for illegal content online (hotlines) so that they can also address this inappropriate use of networks.

1.4

In order to enhance these initiatives, spreading good practice among providers in meeting their obligations has to be combined with advertisement control or the monitoring of users' very early access at a very young age, which together could help eradicate a negative perception of social networks and, at the same time, draw attention to their potential opportunities and synergies. There is also the issue of addiction to social networks; users should be made aware of this, and parents of young adolescents - who are the group most at risk - should be warned.

1.5

The right to privacy needs to be protected in the face of intrusions into people's private lives in the context of labour relations and the use of new technologies, especially social networks, with the social partners regulating the matter in the relevant agreements.

1.6

Finally, the EESC reiterates (1) that it looks forward to the publication of a Code of EU Online Rights that summarises existing digital user rights in the EU in a clear and accessible way and focuses on promoting the responsible use of networks, preventing related behavioural problems and eradicating practices that can be considered as unfair or harmful, especially with regard to hyper-contextualised advertising.

2.1

This own-initiative opinion serves three objectives:

2.2

The overall growth of the digital society, experienced in recent years, and the more specific ongoing growth of virtual communities have highlighted the need to adopt policies for promoting the responsible use of social networks, not to mention preventive policies and policies that provide protection against related risks and problems.

2.3

The ongoing development and spatial spread which have characterised social networks since their inception force us to continually redefine the concept and, as a result, how to approach it. Nevertheless, it is possible to agree on a number of basic and key characteristics in order to identify the relevant areas for action.

2.4

In this context, we can consider that social networks, as forms of voluntary social interaction in a complex situation, are fuelled by dynamic exchange in an open positive feedback system.

2.5

Consequently, the wide variety of social networks and their uses, not to mention their users and content, has resulted in an emerging and ongoing process that involves establishing precise rules about the way they function. This is why it would be useful to carry out periodic fieldwork on this issue and to find out more about users' membership of one or more specific networks, which would also provide guidance for technology-neutral rules which are needed in a process of flexibility that can adapt to this field.

2.6

Furthermore, the actions advocated in this opinion contribute to the EU objective of smart, sustainable and inclusive growth under the Europe 2020 Strategy (COM(2010) 2020). As a result, we need to incorporate within the concept of social networks, the knowledge society, crowd-sourcing, the promotion of more active and responsible users, and an efficient virtual market, or the collaborative spirit and social integration.

2.7

More specifically, not only do we need to improve infrastructure to ensure high-speed, safe and non-discriminatory access, which excludes nobody, by promoting responsible digital citizenship, but also to secure the effective exercise of rights for citizens in the digital environment (freedom of expression and information, protection of personal data and privacy, requirements for transparency and universal telephone and functional internet services and a minimum quality of service) (COM(2010) 245 final/2).

2.8

Privacy is a vital aspect of social network use. The EESC has already presented its views on the proposal for a General Data Protection Regulation, stating its unequivocal support for the right to be forgotten and the preservation of privacy by default, i.e. consent cannot be implied, it must always be given expressly or explicitly.

2.9

Default security and privacy standards must be established for internet search engines, in order to ensure that their profiles are not indexed and that very sensitive data is protected.

2.10

Furthermore, the market must be better managed in this sector, with respect both to the integration of providers and to compliance with concrete and binding measures concerning their practices, including those relating to advertisement control, use of available data or the generation of related business opportunities (e.g. risk insurance policies covering the rights of social network users).

2.11

Nevertheless, in a context of shared responsibility users must respect the instructions and guidelines put forward by the relevant institutions concerning the intelligent and responsible use of social networks ("users' social responsibility"). This makes it possible to optimise available resources and enhance the advantages offered in terms of information dissemination and transparency in a framework for cooperation that fosters learning and multicultural enrichment, and going far beyond the objectives of each network. However, legality is sometimes established on the basis of a mistaken assumption that users are informed and aware, when statistics show that in reality barely one in a thousand users read the conditions.

3.1

The development of social networks has accelerated in recent years, resulting in a spectacular rise in the number of users. In 2010, the total number of users worldwide was believed to have reached one billion (23 % higher than the year before), most of whom were young. Country-by-country data on social network coefficients can be consulted via the world maps of social networks created for this purpose.

3.2

The proportion of young social network users far outstrips users from other age groups. In Europe, according to Eurostat, 80 % of internet users aged 16 to 24 used the internet for this purpose in 2010, compared with 40 % aged 25 to 54, and under 20 % aged 55 to 74 (see the Commission's Risk and Safety survey). Further information on this issue is provided in an opinion that the EESC is currently drafting on advertising that targets children.

3.3

Social networks offer their users a wide variety of possibilities. A social network allows users to get in touch with friends and family who are far away, make new friends, exchange information, exchange multimedia information, develop working relationships, present projects, build social and professional acquaintanceships, and express or defend ideas and causes, etc. These possibilities have been increased to a great extent in areas such as image transmission, infographics and videos with the most recent social networks such as Instagram, Pinterest and Tumblr, whose user numbers have already exceeded those of YouTube, LinkedIn and Google +.

3.4

However, users value, above all, the importance of being able to share content immediately with many people, especially those they have not met through social networks (family, friends, acquaintances), even though they use social networks, at a secondary level, to get to know new people.

3.5

The context of a new relationship model enhances the positive aspects associated with the development of social networks, and in particular, its contribution to (3):

3.6

The usefulness of social networks continues to grow as their application is extended to more and more areas in response to their users' reasons for belonging to them, which include family and social contacts; the exchange of business and entertainment information; hobbies and leisure time; friendships and relationships; access to knowledge and learning development; working and professional environments; civic participation and voluntary work; or discussions about opinions and ideas, etc.

3.7

We need to remember that "internet-based virtual community spaces present and perceive themselves as identical to the physical world where the rules of the game in that environment are not set by the user. When users register they accept contractual rules set by the service provider, although they may be presented to users as free of charge. Nevertheless, a transaction has taken place: we have provided our personal data. When we register on a social network, we do not usually check the legal information, we do not know how our data might be used, or how the environment is configured, who has access to our data and for what purpose" (El Derecho Fundamental a la Protección de Datos: Guía del Ciudadano ("A citizens' guide to the fundamental right to data protection"), Agencia Española de Protección de Datos (Spanish data protection agency), January 2011 (https://www.agpd.es/portalwebAGPD/index-ides-idphp.php)).

3.8

Nevertheless, social network users have the impression that these virtual spaces belong to them and that they are the ones who are creating and controlling the content and information being added. Since these social networks give their users the impression that they are playing an active role as well as a sense of freedom, users may fail to realise that others are deciding and controlling the rules of the game, and that, as a result, they are the ones who have real power over its support and entire content, and who therefore set the restrictions they deem fit (for instance on the users' age, which does not restrict access in practice).

3.9

At the same time, a commitment is being promoted to adopt a code of ethics to safeguard the values of using social networks appropriately for their designated objectives, either in the form of voluntary self-regulation or co-regulation on this issue, in order to control activities.

3.10

Nevertheless, this does not alter the fact that social network users expose themselves to various risks by using these networks. Some of these risks are common to internet use and shared with other applications. However, problems specifically associated with social networks, albeit present in all forms of internet use, are greatly accentuated in the case of these networks because of some of their features, such as the accumulation of data from millions of people; the predominance of young users with no previous training in the intelligent and responsible use of social networks, not to mention warnings regarding their risks (neither parents nor teachers are, as a rule, in a position to lay down rules for appropriate use based on their own knowledge and experience). To this we should add, ignorance of the risks and challenges entailed by such novel and overwhelming development as that of social networks, which places internet users in a situation that borders on the experimental.

3.11

Under these circumstances, societal anxiety is the response to this combination of fast-changing technology and social spaces that are new to minors and which their parents have never experienced. This is however also marked by sensationalism and myth-making, and is generating inappropriate policy responses (UNICEF report entitled Child Safety Online).

3.12

The different associated risks are as follows: psychological trauma caused by insults communicated by means of such services; the sexual harassment of children and young people (cyberabuse, cyberbullying and grooming); psychological harassment in an organisational context perpetrated by superiors, colleagues and subordinates (mobbing); harassment at work due to employers impinging on their staff's private lives or the overuse of smart phones; the posting of photographs or videos of naked or semi-naked adolescents, either by themselves or by others (sexting); explicit advertisements for prostitution and "escort" services; the sexualisation of children via social networks, frequent breaches of privacy, reputation and personal dignity; attacks on the physical and mental wellbeing of site users; incitement to violence, racism and xenophobia; dissemination of totalitarian ideologies which are fascist in nature or advocate Nazism; and suicides by young people, allegedly as a result of certain intimate details being made public through these networks.

3.13

Legal professionals have pointed out that the general terms and conditions of use of many of these networks transfer the copyright of user-generated content from the user to the platform, which is something that most internet users do not realise.

3.14

Risks associated with others using social networks for criminal or harmful activities, especially targeting minors are compounded by other risks generated by the users themselves, which can interfere with their ordinary personal, family, professional and social lives. There is also the risk associated with "online payments", which could encourage children to shop.

3.15

There is also the risk of creating a false identity through deception, self-deception or fantasy. Moreover, it makes it easy to fudge the line between intimacy, privacy and public life and encourages melodramatic and narcissistic behaviour, even where it does not distort reality (Enrique Echeburúa and Paz de Corral). Furthermore, excessive virtual communication has been seen to undermine the quality of human relations, replacing strong and direct relationships with much weaker and often uncertain ones. As a result, users may end up feeling isolated and may even use a virtual life as a substitute for real life.

3.16

This leads social network users to lower their guard and readily accept offers of friendship from strangers, with the result that within a matter of a few hours' conversation, they immediately give out sensitive, intimate and personal information such as their address, telephone number, their parents' names, i.e. the type of information used in questions designed to retrieve forgotten passwords. This can then open the way to finding out other confidential information regarding place of work, future projects and software use.

3.17

In conclusion, as pointed out in studies on this issue, social network users allow strangers into their group of friends on the mere basis of a good profile photo and are willing to reveal all sorts of personal information after a short online conversation. When you consider that most of these networks are built on the idea that these "friends" can have unrestricted access to each member's information and data, it is not difficult to see that one of the practical consequences of generally and indiscriminately accepting anyone you know - or do not know - as a friend, is that anything you share on a social network becomes, de facto, freely accessible.

3.18

This is why it is essential to focus on preventive information campaigns within the Safer Internet Programme to give advice about reading the various services' use and privacy policies before using them, thinking carefully before deciding to post information, using passwords, weighing what information we wish to reveal and controlling who has access to it, contact lists or the risks of infection by a computer virus and, in particular, on available sources of assistance if you have been a victim of irregular conduct of any type on a social network. Similarly, teacher training initiatives and educational materials have to be developed for early civic and digital education.

3.19

To this end, it is very important for the Commission's programmes to provide assistance for user associations and NGOs that are genuinely independent from the public and economic authorities, and which function democratically.

4.1

The World Health Organisation estimates that one in four people have a problem caused by excessive use of new technologies. Children and adolescents are the most vulnerable to this type of addiction since although they are the most accomplished users, they are also the most immature.

4.2

These addictions are also known as "non-toxic", "non-substance" or "non-chemical" addictions. Many experts believe that we should not use the word "addiction" in its strict sense when speaking about "new addictions", "social addictions", and "non-substance addictions". Others believe that it is just as appropriate to use this word as it is when speaking of addictions to work, shopping or sex, for example.

4.3

Excessive use of virtual social networks can lead to isolation, low output, indifference to other issues, behavioural problems and loss of income, not to mention sedentarism and obesity. In short, dependency and the fact that lifestyle is dictated by the habit are in line with the central nucleus of addiction. It is not the type of behaviour involved that characterises addiction to social networks but the type of relationship that the user has with it (Alonso-Fernández, 1996; Echeburúa and Corral, 2009).

4.4

These addictions have an impact on mental health involving episodes of anxiety, depression, obsessions, sleep disorders, personality changes, often resulting in mistreatment, brawls, traffic and work accidents, or self-harm.

4.5

To this we must add problems that have a direct impact on the users' physical health, i.e. physiological problems such as neck pain, tendinitis, carpal tunnel syndrome, eyesight problems, self-neglect, sleeplessness and altered eating habits.

4.6

Internet use -whether or not it is excessive- is associated with psychosocial variables such as psychological vulnerability, stress factors, and family and social support. Some risk factors are specific to the excessive use of social networks among young people.

4.7

Some warning signals (doing without sleep, neglecting important activities, receiving complaints from someone close about one's use of networks, constantly thinking about the network, repeatedly failing to ration online time, losing all sense of time, etc.) appear before the problem becomes an addiction. Listening to these warnings before it is too late can - in combination with the development of evaluation and diagnostic tools - help early detection and subsequent therapeutic treatment.

4.8

Furthermore, public resources and preventive actions are also needed for this purpose (information campaigns, education programmes, digital literacy, assistance services, traceability and notification of risks, etc.), focusing attention on the special needs of the most vulnerable groups.

4.9

Physical and psychological symptoms including mood swings, irritability, impatience, unhappiness, anxiety have been noted in situations where users are forced to go offline, cannot get something done, or when the connection is slow (Estévez, Bayón, De la Cruz and Fernández-Liria, 2009; García del Castillo, Terol, Nieto, Lledó, Sánchez, Martín-Aragón, et al., 2008; Yang, Choe, Balty and Lee, 2005).

4.10

Some personality traits or emotional states can increase psychological vulnerability to addictions: impulsiveness, dysphoria (abnormal state of mind experienced subjectively as discomfort and characterised by mood swings); incapacity to cope with unpleasant stimuli, both physical (pain, insomnia, fatigue) and psychological (aversions, worries, responsibilities); and exaggerated thrill-seeking (Estévez, Bayón, De la Cruz and Fernández-Liria, 2009; García del Castillo, Terol, Nieto, Lledó, Sánchez, Martín-Aragón, et al., 2008; Yang, Choe, Balty and Lee, 2005).

4.11

Sometimes, however, a personality problem underlies the addiction, e.g. excessive timidity, low self-esteem, body image dissatisfaction, or inappropriate approach to everyday difficulties. Prior problems (depression, ADHD, social phobia, and hostility) can also increase the risk of getting hooked on the internet (Estévez, Bayón, De la Cruz and Fernández-Liria, 2009; García del Castillo, Terol, Nieto, Lledó, Sánchez, Martín-Aragón, et al., 2008; Yang, Choe, Balty and Lee, 2005).

4.12

Parents and teachers play a key role in prevention strategies aimed at instilling healthy attitudes towards the use of social networks. It has also proved helpful to get help from "buddies" (more experienced and risk-aware friends who can help their peers or younger friends to identify and avoid risks), who would be seen as online protectors.

4.13

Finally, it is a matter of fostering – through appropriate use – the many opportunities offered by social networks, which often impact on very important issues such as our work or consumption (Salcedo Aznal Alejandro, ¿Sociedad de consumo o redes de consumidores? Esbozo para un análisis social del consumidor actual ("Consumer society or consumer networks? Outline for a social study on today's consumers"), 2008), which are beyond the scope of this opinion. We should therefore undertake all necessary reforms to prevent – in application of labour law – unacceptable intrusions into people's private lives, through the use of new technologies (mobile phones, emails, social networks). To this end, the social partners should conclude agreements based on the principles of the Council of Europe's recommendation on this issue.

15.11.2012   

EN

Official Journal of the European Union

C 351/36

1.1

Almost a quarter of a century on from the publication of the 1988 Cecchini report, the issue of the "cost of non-Europe" has re-emerged and appears a pertinent, useful perspective from which to take forward the debate on pursuing European integration. However, while the Cecchini report looked at the issue solely from the angle of the single market, it is now essential to go much further than that and discuss the costs of not completing economic and monetary union in Europe. These costs are already extremely high and could grow even more if nothing is done.

1.2

The problem becomes quite acute in a situation where – under pressure from the financial markets as well as new binding institutional rules – the Member States are compelled to step up their efforts to cut their debt. But how can this be done without jeopardising the growth which the financial markets are also calling for? The right way to proceed in order to avoid getting caught in an endless downward spiral and reducing a considerable part of the European population to poverty and destitution would be to pool a certain amount of expenditure at European level and to pursue more ambitious policies. This would enable the EU to create a virtuous circle of growth, construct an economic, industrial and technological identity that will hold fast in the context of globalisation and to defend our social model which has to a large extent made Europe what it is today.

1.3

There are doubtless several methodological and technological disadvantages to raising the issue of the costs of non-Europe in the way suggested in this opinion, but it will serve, most importantly, to allow logically indisputable arguments to be put forward for resolving the current crisis and pursuing and completing genuine economic and political union in Europe. Basically, an irrefutable case has to be made to convince public opinion in the various Member States to find solutions to problems by moving the needle on the subsidiarity gauge towards more and better Europe, at a time when certain political forces are trying to make it the scapegoat.

1.4

In this regard, parts of the EU 2020 strategy are extremely useful, and its aim of promoting genuine convergence particularly through common policies and objectives and closer coordination between Member States at all levels and in areas where the European approach is non-existent or embryonic is to be welcomed. Nevertheless, it could be asked whether the strategy is up to the challenge of achieving genuine economic and political union which can reinforce Europe's position in a globalised world and whether – as things stand – it will come to a happier end than the Lisbon Strategy.

1.5

We believe it is necessary to go further, bursting into the scheduled six-monthly discussions of both the EU-17 and EU-27 euro area leaders and pushing our leaders and citizens to wake up to the need for a Copernican revolution in relations between Member States, Europe and the world. Looking at the "costs of non-Europe" affecting us today and in danger of affecting us in the future is a very good way of advancing in that direction. We must use the evidence for economic, political and strategic benefits to thwart the eurosceptics and call public opinion to witness the fact that Europe is not the problem but must be seen as the solution.

1.6

This approach has the advantage of reducing costs, optimising expenditure and maximising opportunities and provides an appropriate response for meeting current challenges and finding a positive way out of the crisis which will benefit everyone.

1.7

In view of all these factors, a much broader analysis of the costs of non-Europe is needed than that proposed in the study commissioned by the Commission on The cost of non-Europe: the untapped potential of the European single market. We do not need yet another report (good though it is likely to be) to clutter the shelves of our libraries and be consulted from time to time by a few very specialised experts.

1.8

The EESC therefore calls on the Commission first to make an as exact an estimate as possible of the full set of costs of non-Europe outlined in this opinion and of their impact on employment and growth. As a second step, we propose that the EU 2020 strategy include calculated objectives for reducing these costs accompanied by a clear action plan and a systematic evaluation of its progress.

2.1

The question of the cost of non-Europe has been raised by the EESC from different angles in several opinions issued in recent years (1). The debate on non-Europe was revived by the European Parliament and the Commission in late 2010, and the Commission has also commissioned an ambitious study updating the work of the Cecchini report (2)  (3).

2.2

The Parliament and the Commission must have opted for this subject and method largely because the Single Market Act II is in preparation, although their papers also stressed the need to address this specific subject and use the scientific evidence (4) the approach would produce. The relatively complex models used by the Cecchini report led at the time to an increase of between 4.5 % and 7 % of EU GDP (for the 12 Member States), with the projected creation of a further 2 to 5 million jobs in the unified area. However, these estimates were based on a methodology and basic hypotheses that are open to some criticism and challenges. Furthermore despite their success in communication terms, as far as we know these forecasts have never been reviewed in any way and thus their accuracy has never been evaluated ex post  (5).

2.3

The EESC welcomes the return of the matter to centre stage, but is surprised that this is happening almost a quarter of a century after the publication of the Cecchini report. However, the way of addressing it – using the same old methodology and calculating once again the potential economic impact of removing barriers to trade in the single market – is at best restrictive and at worst simply inadequate for at least two related reasons.

2.4

The first is the danger of getting caught up in a debate on the costs of non-Europe that is purely technical (not to say technocratic), while – despite the existence of extremely complex tools that could be used – what may seem technical is often only an illusion in the social sciences.

2.5

The second – even more fundamental – reason is that current circumstances are completely different. In 1988, the debate focused essentially on the state of the common market, rebaptised the "single market". In this sense the Cecchini report was very useful, as it accurately pinpointed and calculated the obstacles and delays. In so doing, it provided grounds for a recovery plan and contributed to the drive which resulted notably in the Delors plan and its 1992 goal.

2.6

In 2012 it is no longer the single market which is the core of the issue. Not only has the building of the single market progressed considerably in the last quarter of a century but, above all, the context has developed substantially and now includes at least five new key factors which were not present in the late eighties: 1) globalisation is much more advanced, with the arrival on the international market of emerging countries such as Brazil, India and, above all, China, whereas Europe's competitors in the 1980s were primarily developed countries; 2) Europe is now made up of 27 countries whose levels of development, economic structures and social systems are more disparate than was the case in the 1980s; 3) European integration has evolved considerably, with various key institutions such as the euro and the ECB now in place; 4) an economic crisis worse than any since the 1930s is still ravaging Europe, having now become a sovereign debt crisis; and lastly 5) the imperative need for the EU Member States to cut their debts in the coming years.

2.7

In view of these factors, we suggest that the debate be based on the costs of non-Europe in a very different way. The handicap beleaguering Europe now is not so much delays in building its internal market (which, by the way, benefits our competitors as well as Europeans), as the overriding need to establish a strong economic, industrial and technological identity in the context of multi-polar globalisation characterised by increasingly tough competition, from the emerging powers especially, during an unprecedented systemic crisis.

2.8

Discussion therefore needs to consider all the costs of non-Europe resulting from the failure to complete European integration. These costs extend far beyond those which might be occasioned by any remaining barriers to intra-Community trade. The EESC is aware of the difficulties of taking such a broad and political approach to the matter, but it is the only approach that we believe makes sense in the current situation (6).

3.1

Sixty years ago, Europeans' dream of living in peace became reality with the creation of the first European community, the ECSC. The journey towards integration was slow but sure up until 1992. Over the last 20 years, EU enlargement to 27 Member States has undeniably signified a great step forward, but it is the only real progress achieved. The deepening of the EU announced as long ago as the early 1980s has been forgotten. The single currency, the internal market, the cohesion policies or the CAP are certainly major steps forward but incomplete and, above all, not enough to establish a genuine Union.

3.2

Once the subject matter of the debate has been decided, there is, of course, the matter of the debate itself. What does the cost mean? What does non-Europe mean? What, even, does "non" mean? Potentially, everything can be seen as Europe or non-Europe. It is objectively difficult to single out the instruments, policies and public goods concerned, to isolate their respective impact, to determine at what level they would be most effectively employed (European, national or local), to decide in what terms to express the costs and benefits and even over what timeframe they should be analysed (and the list of difficulties does not stop there). Given all these factors, reaching agreement on a rigorous methodological approach and moving beyond agreement on general matters is no easy matter. The European Parliament memo on the methodological aspects helpfully clarifies the issue and perfectly illustrates how complex it is.

3.3

However, whatever the approach, the definitions – even the broadest definitions – of the concept do not enable part of the essential public goods (such as peace or the free movement of persons), produced by European integration in a little over half a century, to be included in the debate.

3.4

Without wishing to attempt to calculate their contribution to Europeans' well-being or to rewrite history (what would have happened if European integration had not taken place in its current form?), it is worth pointing out – at a time when it is becoming more and more in vogue to talk about the costs of Europe – that the history of our continent has not always been such as we have experienced from 1945 to the present day. Peace, prosperity, fundamental rights (as enshrined in the EU Charter (7)), free movement of persons and goods, the possibility of using the same currency across borders, price stability and other benefits which are part of our daily life are currently perceived by many of us (particularly the younger generations) to be absolutely normal, a kind of natural state: border controls between France and Germany would be seen as a tedious oddity while the spectre of a war between European countries resembles a bad-taste joke. Clearly, it would be difficult, if not impossible, to say what the situation would have been like today had we stayed within the bounds of national frameworks, but it does not seem unreasonable to state that European integration has at the least facilitated the emergence of these public goods and has made them very apparent and natural to everyone.

3.5

Does that mean they are now here for ever? This remains uncertain. The possibility of a civil war would have seemed just as absurd and unlikely in Yugoslavia in the eighties, but that did not prevent the extremely bloody wars after the country split up. The other successes, which took years to achieve, can be reversed: establishment of border controls or questioning the validity of the euro area are subjects which commentators, Eurosceptic and/or populist political parties and – increasingly often – traditional political movements have no hesitation in raising in various contexts.

3.6

Lastly, without going into the most extreme scenarios, the question of the cost of non-Europe will be inescapable if certain key institutions, such as the single currency, totally or partially fail. The UBS Bank has recently produced a study (8) which, despite many weaknesses in its methodology, evaluates the costs of leaving the euro at 40-50 % of GDP for a "weak" country in the first year alone. Even for a "strong" country (such as Germany), this cost would come to 20-25 % of GDP for the first year alone, or EUR 6 000 to 8 000 per inhabitant. This does not include the destabilising political effects, potential "currency wars" with successive competitive devaluations, a resurgence of protectionist policies nationally and the potentially disastrous impact on the expectations of economic operators. These could plunge Europe into an extended slump for several years. No-one can predict the potentially disastrous consequences of these events, but we can expect considerable endeavours to form major new geopolitical configurations, giving rise to new alliances which would be potentially destabilising for Europe as a unified political and economic bloc.

4.1

Contrary to the populist ideas being voiced in certain political quarters in numerous EU countries, in particular since the outbreak of the 2008-2009 crisis and its various manifestations since, current economic problems are not related to excesses by eurocrats in Brussels but to the fact that European integration is fundamentally incomplete. The stated aim of building a monetary and economic union has in practice never been achieved. The shameful disinterest displayed by Member States and the European institutions, constantly putting off the work necessary to achieve genuine economic integration and the processes necessary for legitimate and democratic decision-making in the Member States (some of which have gained considerable media attention), have ended up – in the face of an asymmetric external jolt of unprecedented violence – causing a spiralling lack of confidence in the markets. This state of affairs is costing all EU countries more and more in terms of competitiveness, growth and jobs, social cohesion and even democratic legitimacy in Europe.

4.2

The limits of establishing monetary union without real economic union have become apparent as they have led to divergence rather than convergence. Now, Europe no longer has the time to wait for things to come about naturally as history runs its course. The choice is either moving rapidly forward to complete genuine European economic union, including an effective mechanism allowing it to withstand asymmetric shocks, or bearing the potentially explosive costs of non-union in the future.

4.3

The current difficulties dogging the euro, which is essentially an incomplete currency, reflect this situation. The relative levels of public debt in the euro area as a whole, and even of most of the European countries considered to be under threat, are lower than those of other countries described as developed, such as the United States, the United Kingdom and Japan. However, whereas the dollar, the pound and the yen are seen as the currencies of true, mature powers, the euro suffers from its image as a currency whose sovereignty remains rather unclear (9), from a restrictive mandate conferred upon the European Central Bank and from the lack of any real economic governance at European level. For all these reasons, it is vital to achieve a genuine European economic union with rules – including rules that are binding – and clear responsibilities at every level. Only wide-ranging political reform, which would confer the political legitimacy needed on such a union, can make this a reality.

4.4

It is difficult to measure the full costs of this lack of confidence in the markets, which is, moreover, to a large extent responsible for the current recession. However, simply as a result of risk premiums levied on certain Member States in the current period, the cost of non-Europe for public budgets could be evaluated at between 0,4 % and 1,5 % of GDP in 2012 (i.e. between EUR 9 billion and EUR 36 billion) and up to 1,8 % and 2,4 % of GDP in 2013 and 2014 (i.e. EUR 42 billion and EUR 56 billion) respectively for the whole euro zone, with marked differences between countries, of course (10).

4.5

Successfully completed economic integration including, in particular, closer budgetary and fiscal integration subject to strict conditions and monitoring, would have been able to eliminate these risk premiums by putting mechanisms for pooling resources in place at European level (such as eurobonds or other instruments) instead of endless improvised, ad hoc emergency containment measures when the situation becomes untenable. The Member States and the EU must find the courage not to act reactively but to adopt coherent institutional reforms and a plan of action in order to find a global response to the current crisis that will set out a genuinely credible vision for the future.

4.6

Recently some steps have been taken in this direction. Regrettably they do not go far enough.

5.1

At the Brussels summit on 9 December 2011, reviving the discipline of the Maastricht stability pact, the parties undertook to slash the Member States' deficits by instituting now automatic penalties for infringements of the golden rule. Under pressure from the financial markets and new binding rules, the Member States will now be obliged to step up their efforts to cut their debt.

5.2

The basic question put to the political leaders of several European Member States faced with the situation of public debt is a case of trying to square the circle: how to reconcile the lack of confidence in the markets, as everyone is demanding, while – almost simultaneously – kick-starting growth? One way to solve this unsolvable equation is to abolish needless duplication between Member States by working together to achieve economies of scale and, at the same time, lay the foundations for future budgetary recovery at EU level. In this way, it would be possible to avoid or at least curb the depression-inducing effects of beggar-my-neighbour austerity measures, without crippling the public services provided while, at the same time, doing something about the problem of the wastage resulting from 27 – frequently uncoordinated – different policies in the same areas. Clearly, this idea is impossible to implement with a Community budget of only 1 % of GDP and totally incompatible with the suggestion of cutting budgetary expenses across the board, including at European level.

5.3

Total defence spending by the Member States came to nearly EUR 200 billion in 2010 but, in the view of many experts, national defence policies are still fragmented and generally ineffective (11). Despite many European- and national-level initiatives, appropriations for equipment and R&D defence programmes (almost 20 % of the total budget) are practically the only area of genuinely pooled expenditure and even then, EDA estimates put this at 22 % in 2010 (12). Studies on this point have posited a savings potential of 32 % or EUR 13 billion for these budget headings alone if expenditure were pooled (13).

5.4

This reasoning could apply to other sovereign areas of the Member States, such as the diplomatic service, customs, border guards, civil protection, combating fraud, etc. Cutting costs in all of these spheres, despite possible disagreement over the exact amount of these costs, is purely a question of political will.

5.5

The fiscal cost of non-Europe is a consequence that simply adds to the budgetary cost. No framework based on common European interests has been established for fiscal competition between the Member States. As a result, mobile bases liable to relocation are undertaxed, while others are overtaxed, resulting in lost tax revenue (and thus a cost) for Europe and the Member States. This situation also leads to imbalance, injustice and above all heavy social costs which are bitterly resented by the general public.

5.6

As regards the social domain, the discussion on the cost of non-Europe is not new. European integration cannot be based solely on the principle of free trade, with competition and consumer well-being taking precedence over everything else and causing downward social levelling. It should be pointed out that, despite frequent allegations of "European diktats", there, too, the problem is not enough Europe rather than too much. Over and above the feelings of injustice and extremely high social costs, particularly in the current context, the conclusions of several studies show that non-Europe in this domain also levies a high economic cost (14). Thus, empirical data show that a fair and effective social policy contributes to macro-economic stability, not only by diminishing the impact of cyclical phenomena and promoting more effective allocation of resources, but also by fostering the well-being of citizens more generally (15). What is more, good social policies tend to reduce adverse selection, internalise some external factors and upgrade the labour force and "social capital" in the broad meaning of the term. The European Social Charter aimed to introduce some basic rules in this area for all the Member States. It now seems necessary to go further and envisage a structured framework for the convergence of social policies in order to reduce gross disparities and to ensure that worsening social imbalances and the general increase in poverty do not end up becoming serious obstacles to significant, balanced and sustainable economic growth.

5.7

Fiscal and social competition, which is very poorly regulated in an economic area with few barriers to the movement of goods, services and capital also fosters other trends which are highly damaging in a globalised economy. The gradual collapse of industry in several European countries is an undeniable reality which is vigorously opposed by citizens and poses strategic problems for our countries as these developments are extensive, would be difficult to turn around in the short or medium term and will thus have serious ramifications (16). The growing inconsistencies caused by national guidelines having primacy in the area of industrial policy have resulted in unilateral solutions which are less than optimal and sometimes even counterproductive (17), at a time when the emerging countries are applying confidence-inspiring industrial policies based on a weak currency and active government support (18). Rather than pooling or at least coordinating resources in order to meet these challenges, several major European countries are increasingly compelled, in the absence of a "European Energy Community" (19), to make bilateral agreements with third countries in areas as crucially important as energy and R&D (20). It is obvious that a European policy would undoubtedly be a much more effective solution.

5.8

The EU's R&D budget for the 2014 to 2020 period is 0.08 % of its GDP, which is 20 to 30 times lower than national budgets. One study concludes that every additional public euro invested in European-scale R&D subsequently brings in EUR 0,93 from the private sector (21). The Seventh Framework Programme for Community research (FP7, 2007-2013), which has EUR 50,5 billion in funding, shows that this is not just wishful thinking but that a common policy in the field is possible. The impact of the programme is huge: it is estimated that each euro spent by the framework programme results in time in an increase in industrial added value of between EUR 7 and EUR 14. In the long term, macro-economic studies carried out by DG Research predict that the Seventh Framework Programme will have enabled 900 000 jobs to be created by 2030, including 300 000 research jobs. In the same period, increased competitiveness will have resulted in an increase in EU exports of almost 1.6 % and a decrease in its imports of some 0.9 %.

5.9

Moreover, the common industrial policy must imperatively factor in environmental issues and be closely coordinated with EU energy policy. Managing energy issues nationally can give the illusion of making things easier in the short- or medium-term, but it can also prove very costly in the long term, leading to substantial dependence on hydrocarbon-producing countries and causing energy bills to soar. The answer could be to invest in development of energy infrastructure and dissemination of new energy sources with European-scale R&D (22). According to an Accenture study commissioned by DG Energy, use of renewable energies such as wind energy in the United Kingdom or solar energy in Spain, along with the interlinking of national networks, could cut European consumers' bills by some EUR 110 billion by 2020.

5.10

In the current crisis, the risk of long-term, potentially permanent unemployment is growing. That could prevent individuals from achieving self-fulfilment in the workplace and deny the European economy their potential. Such a situation conflicts with the goal of inclusive growth and calls for an intensive search for long-term solutions, which should, among other things, involve support for inclusive jobs from public funds, with the aim of maintaining working habits, and for retraining activities, with the aim of adapting people to the future needs of the job market.

15.11.2012   

EN

Official Journal of the European Union

C 351/42

1.1

EU citizens who inherit assets across national Member State borders are frequently faced with taxation in two or more different Member States (i.e. double or multiple taxation) and tax discrimination. These problems often impose undue hardship on citizens and hamper the achievement of the EU-2020 objectives. In an attempt to address these problems, the Commission presented a Communication in 2011 and an accompanying Recommendation.

1.2

The EESC is in favour of removing double/multiple and discriminatory taxation, and welcomes the approach adopted by the Commission which respects the tax sovereignty of individual Member States while calling for better interfacing of national tax systems.

1.3

It is however the opinion of the EESC that the Commission can be more effective in achieving the final aims of this exercise by:

1.4

The EU Taxation Observatory, whose creation under the auspices of the Commission has been suggested in EESC opinions (1) dealing with multiple and discriminatory taxation, could serve as the instrument through which the above recommendations are implemented.

2.1

EU citizens who inherit foreign property are frequently faced with a tax bill from more than one Member State (multiple taxation). Moreover, several Member States tax foreign inheritances more heavily than local inheritances (tax discrimination). In such cases, citizens may face undue hardship on the event of inheritance. In particular, small businesses may face transfer difficulties on the death of their owners.

2.2

Legal remedies are available to protect citizens against tax discrimination. These, however, are often not effective because of prohibitive costs. No legal remedies are available to protect citizens against multiple taxation, due to the rights of several Member States to claim taxation (2).

2.3

This is taking place within the context that the number of EU citizens moving from one country to another within the European Union increased by 3 million to 12.3 million between 2005 and 2010, and cross-border real estate ownership in the EU increased by up to 50 % between 2002 and 2010 (3). There is also a significantly increasing trend in cross-border portfolio investment. While citizens can be affected heavily by multiple or discriminatory inheritance taxation, EU Member States revenues from inheritances taxes account for less than 0.5 % of total tax receipts, with cross-border cases alone accounting for far less.

2.4

This situation is a serious obstacle to the freedom of movement of persons and capital within the Single Market, thereby hampering the achievement of the EU-2020 objectives. It is also in direct contrast with EU citizenship rights.

2.5

In an attempt to address these problems, the Communication and accompanying Recommendation issued by the Commission are intended to have the following effects:

3.1

The EESC is in favour of addressing multiple and discriminatory taxation, so as to uphold citizens' rights and promote the Single Market. The EESC has stressed this through a number of its opinions and in particular recommends the removal of multiple and discriminatory taxation for citizens as well as the enhancement of administrative simplification in cross-border situations (5).

3.2

As a result, the EESC welcomes the Commission Communication on Cross Border Inheritance Tax Obstacles because the Communication:

3.3

The EESC furthermore welcomes the approach adopted in the Communication which respects the tax sovereignty of individual Member States and advises them to seek better interfacing of national tax systems while removing discriminatory taxation within national tax frameworks.

4.1

It is however the opinion of the EESC that the Commission can be more effective in achieving the final aims of this exercise by:

4.2

The Commission could furthermore consider that the undertaking of these functions would form part of the mandate of an EU Taxation Observatory, whose formation under the auspices of the Commission has been suggested in EESC opinions dealing with multiple and discriminatory taxation (6). The Observatory would contribute to the more effective resolution of inheritance tax obstacles on an ongoing basis through research and investigations and provide fora for consultation, collaboration and agreement between different national tax jurisdictions.

15.11.2012   

EN

Official Journal of the European Union

C 351/45

—

access to loans;

—

access to venture capital;

—

access to capital markets.

—

the Competitiveness and Innovation Programme (CIP);

—

the EIB allocation for SME loans;

—

Cohesion policy funds;

—

the Risk Sharing instrument in FP7.

—

regulatory measures;

—

financial measures to improve lending and venture capital across the EU;

—

measures to improve the environment for SMEs.

4.1.1

The EESC supports the introduction of a harmonised regime for cross-border operations by VC funds. The proposal is laudable as it is likely to alleviate market deficiencies thanks to the creation of a "European Passport" enabling EU venture funds to market their products and raise capital on a pan-European basis. The EESC made a number of comments in its previous opinion on venture capital (4) and asks the Commission to take them into consideration.

4.1.2

The EESC strongly supports the study that the Commission will carry out in 2012 on the relationship between prudential regulation and venture capital investments by banks and insurance companies. The study should assess whether these instruments are creating an oligopoly of large international banks or need to be changed in the medium or long term.

4.1.3

As the majority of SMEs are small businesses (less than 10 employees), the EESC invites the Commission to pay special attention to micro venture funds. These funds invest in enterprises whose projects are not attractive enough for the attention of traditional venture capitalists but are too big or risky to attract capital from traditional lending sources. Such funds strengthen a company's capital base and develop entrepreneurs' business skills using coaching methods throughout the investment period (5). Member States are invited to propose tools such as specific taxation measures that could stimulate the development of those funds in order to fill the financial gap.

4.2.1

We welcome the Commission's proposals on taxation reforms for cross-border VC investments. The Committee invites the Commission and the Member States, at the same time, to propose clear measures to prevent tax avoidance and evasion.

4.2.2

As well as addressing the tax obstacles to cross-border transactions, the Commission should also ensure that Member States encourage tax reform in their own countries for SME financing schemes.

4.2.3

Good practices that exist in some Member States should be looked into and expanded across the EU and disseminated to SMEs (6). In a number of countries fiscal stimulus packages are already in place. An example of these could be Belgium/Flanders, which introduced a win-win-loan a few years ago, whereby individuals can lend money to SMEs and get a tax reduction in return. Another good example is the Dutch system known as the Tante Agaath loan  (7).

4.2.4

Tax exemptions such as France's ISF PME law (8) can also be of real benefit to high-growth SMEs. The EESC is in favour of such schemes as long as the amount of exempt taxation is reasonable and would not impinge on contributions to other equally important sectors.

4.3.1

The EESC supports the envisaged State Aid Modernisation proposal to simplify current state aid rules for SMEs. It takes note that the Commission will review the General Block Exemption Regulation and a number of state aid guidelines, including on risk capital, to achieve Europe 2020 objectives. The EESC urges that these rules be improved, simplified and clarified. Our Committee invites the Commission to ensure that state aid is only used to target market failure.

4.4.1

The EESC welcomes the fact that the MIFID directive proposes to develop homogeneous SME growth markets and make them attractive for investors thanks to the SME growth market label. However, the EESC suggests (9) laying down specific provisions and measures which will enable it to be implemented efficiently and effectively.

4.5.1

The Commission and Member States are invited to reduce accounting rules and reporting burdens for listed SMEs in Europe. The Committee acknowledges the fact the Commission presented a proposal for a directive simplifying and amending the Accounting Directives and, at the same time, a proposal revising the Transparency Directive. The EESC reminds the Commission to take on board its two opinions issued early in 2012 (10) and feels that SMEs need to free up resources to invest in their businesses in order to deliver further growth.

4.6.1

The EU needs to continue to be at the forefront in implementing the internationally agreed financial regulatory reforms. The EESC however notes that the various capital requirements implementing Basel III in the EU coming into force and currently being discussed (CRD IV/CRR) may cause various problems for SMEs (11).

4.6.2

The EESC supports the efforts of the European institutions to increase the resilience of the financial system, in order to avoid future crises. However, more regulation of the financial markets therefore cannot be made at the expense of the financing of small and medium-sized enterprises. The EESC fully supports the "Karas Report" adopted by the European Parliament in May 2012 which is a further step in the right direction towards a sensible and workable implementation in the EU of the "Basel III" rules on capital requirements.

4.6.3

The EESC takes note that the Commission will consult the European Banking Authority (EBA) within 24 months after the entry into force of the new Directive (CRD IV) and that the EBA will report on lending to SMEs and natural persons. The Committee urges the Commission to be fully involved in the reassessment of the risk weight by expressing its opinion on the report to be sent to the Council and the European Parliament.

4.7.1

The Commission envisages implementation of this Directive by 16 March 2013. The EESC presses Member States to act to ensure that SMEs can benefit more quickly from the system. It is also very important for the Commission to monitor the timely implementation of this Directive in all Member States. Furthermore, the Commission needs to follow-up very closely the way Member States implement Article 4(5), which gives them the possibility of lengthening the verification procedure to over 30 days, unless this would be grossly unfair to the creditor. The Commission should closely monitor Member States to prevent them from using this article to artificially delay payment, especially since delays in payments by public authorities have a significant impact on SMEs' cash flow and liquidity management.

4.7.2

In order to set an example, the EESC invites the European Institutions to pay their contractors on time and avoid imposing unnecessary administrative and financial burdens on them.

4.8.1

The EESC welcomes the European Commission's proposal for a Regulation on European Social Entrepreneurship Funds and reminds the Commission that improving access to appropriate capital for social enterprise needs to be high on the agenda. The EESC expressed its opinion (12) on that issue early in 2012. One of the challenges is the need to measure and report on the social effects and impact on society of portfolio undertakings. The EESC recommends undertaking a joint study at EU level in order to develop criteria and indicators to tackle such issues. The Committee reminds the Commission that such funds can only be one tool of many much-needed financial instruments that still need to be developed.

4.8.2.

The EESC also invite Member States to improve the recognition of different forms of social enterprises. If they had greater recognition, these businesses would see a reduction in the risk weight for loans granted to them and would no longer be disadvantaged in this area, compared to traditional businesses.

6.1.1

The EESC welcomes the proposal to bolster information to financial intermediaries and to encourage banks and financial institutions to provide their clients with all the necessary tools to help them find financing. Furthermore, the EESC considers it important to boost financial education for SMEs. Member States are strongly encouraged to participate in that exercise by setting up specific "investment readiness" programmes for SMEs in close cooperation with SME organisations.

6.1.2

One of the major problems for the vast majority of SMEs is that of access to specially tailored advice. The EESC supports the principle and the role of the Enterprise Europe Network (EEN) yet considers that its potential should be fully used (15). Consequently, the EESC suggests strengthening the financial advisory capacity of the EEN. It stresses, however, that SME organisations must be closely involved in this campaign as well and that it should be tailored to highlight the diversity of SMEs.

6.2.1

The Committee notes that the Commission has already worked on this issue ((SMEs' Access to finance surveys and SME Finance Index). It welcomes the proposal from the Commission to work more closely with bank federations and to gather advice from other institutions (ECB, EBA). The EESC recommends involving SME organisations and institutions at Member State level too. The EESC regrets that the Action Plan does not refer to reinforce cooperation with international organisations such as the OECD to produce data and statistics (16) on access to finance.

6.3.1

Purely quantitative rating models are often not suited to the evaluation of SMEs because they are too rigid. Using qualitative factors in addition to the common quantitative analysis is more than welcomed. Banks could therefore consider balancing their scoring methods for assessing SMEs' credit-worthiness with adequate room being left for “relationship banking”. This issue also needs to be addressed by exchanging best practices. The EESC regrets that some banks seem to be moving away from this idea rather than promoting it.

6.4.1

The EESC believes for instance that it is important to develop the link between business angels and early stage VC funds with later stage venture funds in order to ensure a healthy innovation finance chain. Moreover, initiatives to support greater dialogue at regional level between business angels, VC funds and local entrepreneurs are strongly encouraged.

6.4.2

Innovative approaches to venture funding ought to be looked into and implemented. One such approach is crowd funding, in which citizens, and not banks or specialists, invest in SMEs through an online platform, instead of the stock exchange market.

6.4.3

Tailored forms of hybrid capital (17) containing elements of grants, equity and debt capital (such as profit sharing loans) should be strengthened, because they suit SMEs better both in the early stages and throughout their life cycle.

7.1.1

Consideration should be given to developing a framework within which credit could be encouraged from lenders operating on the basis of a philosophy of risk- and profit sharing, since SMEs could certainly benefit from it. Phenomena such as participatory banking should be seriously considered by the Commission. The EESC would like the Commission to prepare a Green Paper as a basis for launching a debate on participatory banking at European level. Separate initiatives taken by countries such as the UK, France, Germany, Italy, Luxembourg and Malta are positive but may hinder further integration of the financial services industry within the EU. Furthermore, separate non-coordinated initiatives may not give the most efficient outcomes that this type of finance could achieve, such as risk sharing, profit sharing and a social approach to finance. The encouragement of micro-finance with specific investment policies referring to Islamic finance could also give rise to new entrepreneurial activities whilst helping to fight poverty in certain regions. In this context, a Commission communication envisaging, addressing and encouraging alternative financing methods should be developed to ensure that these are on a level playing field with financing methods such as conventional finance.

7.1.2

The EESC takes note that the Commission has analysed the work and the results obtained by credit mediators as well as problems faced by SMEs in their search for loan finance (18). The EESC invites all Member States to create such a function in order to improve transparency in the lending process. The Committee notes that Article 145(4) of the Capital Requirements Directive (CRD III), and Article 418 (4) of the proposed Capital Requirement Regulation (CRD IV) include provisions that allow SMEs to ask banks to inform them of their rating and scores. It would be important to fully implement these provisions in practice.

7.1.3

With regard to competition in the banking sector, the EESC asks the Commission to study the situation and ensure that there is enough competition in the banking sector within and between the different Member States in the field of financial products for SMEs. For example, there is the problem of funding loss (see below); at the same time, overdraft rates for small enterprises remain at a very high level, even though ECB bank refinancing interest rates are at a historically low level. Big companies can use alternatives (such as straight loans), but small enterprises cannot use these products.

7.1.4

Funding loss: In many Member States, charges are levied on businesses by banks when they repay their loans ahead of schedule. Whenever a loan is paid back earlier than envisaged in the contract, the bank charges this so-called "funding loss" fee to compensate for the fact that the bank might have to re-invest the money at a lower interest rate than the one they would have got if the loan was not paid back earlier than expected.

7.1.5

The problem, however, is that these funding loss charges are often quite high. Moreover, these charges are often not very clearly explained in the contract, which also refers to future, as yet unknown interest rates. This makes it very difficult for a business to estimate the possible funding loss charge in the event of early repayment. In any case, most businesses are not even aware of the obligation to pay a funding loss charge.

7.1.6

It is therefore crucial for banks to provide clearer information on such charges before any loan agreement is signed. In addition, the amount of the funding loss charge should be limited and reasonable.

7.2.1

The EESC is in favour of creating a single multilingual online database of different sources of finance, integrating European, national and regional measures to facilitate SMEs access to finance. The Committee invites the Commission to disseminate widely the practical guide (19) that it drew up providing information on how to access EUR 50 billion of public finance in the 27 Member States.

7.2.2

The EESC is of the opinion that, with regard to the "Horizon 2020" programme, a dedicated budget of 15 % of the overall programme and a single management structure are key to making the most of the innovation potential of SMEs. As regards the procedure, improvements must be made concerning financial and administrative issues. For instance, many SMEs participating in EU-funded research projects still face enormous VAT-related issues in their respective countries when participating in projects. Very often this is one of the main stumbling blocks to those actually participating from the start. Clear regulations relieving SMEs of these burdens should be implemented in all Member States. VAT should be recoverable in all circumstances in EU funded projects.

15.11.2012   

EN

Official Journal of the European Union

C 351/52

1.1

The European Economic and Social Committee (EESC) welcomes the Commission initiative to promote a secure, transparent and innovative payments environment throughout the EU. More efficient, modern and safer payment instruments are a precondition for expanding further benefits of the Single Market as well as strengthening the global competitiveness of the European economy.

1.2

The EESC appreciates the broad nature of the dialogue proposed by the Commission, which indeed encompasses main issues of the present and foreseeable landscape of payments in the EU. However, in order to have the full picture cash payments deserve further attention. Although gradually decreasing, cash remains the predominant means of payment in certain markets. Increasing national evidence shows that cash in principle is less efficient and significant resources could be saved if consumers switched to electronic payments. Certain Member States have made real progress in moving towards a cashless society. Nonetheless, the EESC believes that the true cost of cash is still not known to general public. Moreover, cash is considered to be a facilitator of the shadow economy. Therefore payment methods that help reduce shadow economy are less expensive and more secure and should be promoted by all stakeholders involved. The many benefits for all stakeholders concerned, but on the other hand as well the need for a reasonable cost for SME offering these payment methods to their customers should be considered in this context. Additional initiatives are needed in the Member States with the clear support of the Commission.

1.3

Card payments are the most popular non-cash payment instrument in the EU and worldwide. A growing consensus in the literature on economics considers non-cash payments to be more transparent in fiscal and economic terms and also cheaper for society as a whole, easy to use, safe and innovative. The EESC consequently supports the Commission's proposal to use such payments to reap the benefits of greater market integration. However, the Single Market opportunities are not yet fully exploited due to historical barriers and lack of standardisation and interoperability and to the discrepancies and shortcomings in the use of public information, which can be remedied through greater use in payments by payment cards, the Internet and mobile telephones. As a consequence, competition, innovation and efficiency have unrealised potential. The EESC calls for market initiatives to propose enforceable solutions as soon as possible, especially those at the same time favouring financial and digital inclusion.

1.4

The current legal uncertainty regarding interchange fee based business models hampers card, e- and mobile payments' growth and cash displacement. Clarity is of utmost importance for investment and innovations in payment systems. The EESC urges the Commission to stabilise the business environment for all operators. In line with SEPA objectives there should not be any differentiation of fees and other requirements both for domestic and cross-border transactions.

1.5

The access of information on the availability of funds on bank accounts requires careful consideration of many aspects including security, data protection, consumer rights, competition and compensation to account issuers. The EESC notes that entities seeking access should be regulated and supervised commensurate with their risk profile. The European legal framework should clearly reflect the obligations and responsibilities of the operators involved.

1.6

In many markets customers may not be ready to accept surcharging and therefore could shift to cash payments based on the impression that cash is free of charge. Even though consumers would be protected from abusive surcharging by the Consumers Rights Directive as from 13 June 2014, it is not straightforward how this protection will be ensured in a highly agile online environment.

1.7

E-payments are appreciated by customers on domestic markets. However, Pan-European solutions, based on internet banking, are pending. This therefore complicates the up-rise of e-commerce. The EESC calls on the operators of such systems to work on interoperability issues in an open and transparent manner and address missing issues in e-commerce as soon as possible.

1.8

The EESC calls on the Commission to ensure that m-payments from the early phase of their development will respect the principles of open access to platforms, portability of applications, security as well as avoidance of duplicate costs for operators wishing to accept these payments.

1.9

The EESC acknowledges the progress reached by market participants in curbing fraud at physical terminals. Currently, on-line fraud poses the biggest threat. Additional security measures should be implemented, but not at the expense of customers' convenience. If proposed by public authorities, security measures should be technologically neutral to the extent possible.

1.10

The EESC welcomes the on-going efforts to strengthen the current Single European Payments Area (SEPA) governance and supports intentions to centralise the "ownership" of SEPA, for instance under the umbrella of the SEPA Council. However, the EESC urges the Commission and the European Central Bank to work on details as soon as possible as the current de facto vacuum hinders implementation.

2.1

Completion of SEPA is one of the Commissions priorities for achieving the Single Market. The achievements of standardisation and interoperability supported by a harmonised legal framework are already available to operators in the form of SEPA credit transfers and SEPA direct debits, which by 1 February 2014 will replace the legacy schemes in the Euro area.

2.2

The scope of SEPA, however, is wider and encompasses other pillars. One of them is devoted to card payments, the most important payment instrument in the European Union as well as worldwide. E-payments, i.e. payments made over internet for purchases, are another such pillar. Nowadays these payments represent a tiny fraction of all non-cash payments, but double-digit growth is expected. The European Payments Council (EPC), which is the coordination and decision-making body of the European banking industry with regard to payments, extended their cooperation activities towards e-payments and developed the SEPA e-Payment Framework. Recently the EPC became the subject of a request for information by the Commission's DG Competition.

2.3

M-payments are the most recent pillar. The EPC in cooperation with other operators took coordinated actions regarding m-payments by preparing technical documents on interoperability guidelines and several white papers. M-payments are still at an early stage of development, but expectations are very high regarding their future status. Whilst card payments, e- and m-payments are different in their maturity, scale and business models, there is a general understanding shared by the European institutions and market operators that additional progress is required in terms of integration, transparency and competitiveness. There is a risk that detriments witnessed in existing business models may be replicated in forthcoming m-payments environment.

2.4

Every citizen, business or public administrator is engaged in payments activities realised either through traditional means of payment (e.g. cash) or modern payment services (e.g. e-payments). According to statistics from the European Central Bank (1), the total number of non-cash payments in the EU increased by 4.4 % to 86.4 billion in 2010 compared with the previous year, of which card payments accounted for the largest share (39 % or 33.9 billion). The value of card payments reached EUR 1.8 trillion, rising by 6.7 % on a yearly basis, which is more than three times the 1.8 % growth in the euro area's real GDP. Whilst there are significant differences in terms of card usage from one country to another, the general trend is that card payments are one of the most dynamic non-cash payment instruments.

2.5

The fact-finding survey carried out by the European System of Central Banks (2) showed that inter-change fees are not set and applied in a harmonised way throughout the European Union. The choice, structure, and level of inter-change fees differ in many ways and depend on a number of options and dimensions. The interchange fee is the main component of merchant fees. The Commission as well as national competition authorities assessed the competition aspects of interchange fees and took a number of decisions, some of which were related to cross-border activity, while others were restricted to the national level.

2.6

With regard to fee transparency, regrettably, no official surveys have been carried out and no comprehensive national or country-comparative statistics have been published on the costs paid by consumers, such as various fees and charges directly related to different means of payments, despite the fact that this information is available for national supervisors, most of whom do not make any of it available.

2.7

Despite on-going private initiatives towards standardisation, fragmentation still persists in certain transaction domains: between card acquiring and card issuing payment service providers, between card and terminal as well as between terminal and card acquiring payment service providers. However, often driven by diverging commercial interests or without clear implementation time-tables at this stage, they have yielded limited concrete results.

2.8

The significant investments and efforts by all operators in order to migrate from magnetic stripe to EMV-chip technology had a positive impact on driving down card fraud in face-to-face environment. However, the recent trend shows that remote card transactions, although having a minor share of all card transactions, already poses the biggest fraud threat. This issue has drawn the attention of supervisors and overseers who in 2011, under the umbrella of the European Central Bank, joined forces within the "SecuRe Pay Forum" in order to enhance the security level and public trust in electronic payment services and instruments. In 2012 the forum will finalise a set of technology-neutral recommendations for the security of internet payments.

2.9

The Commission's Green Paper deals with a whole set of payment issues, which if successfully addressed would provide the basis for more integrated and secure payment services provided either in traditional bricks-and-mortar shops or in fast developing electronic environment. With more competition, more choice and transparency for consumers, more innovation and more payment security and customer trust Europe has an opportunity to be at the cutting edge of what "making a payment" could mean in the 21st century.

2.10

The Commission describes the vision of integrated market, identifies the gaps between the current situation and the vision as well as the barriers causing these gaps. The Commission defines five broad measures aimed at accelerating market integration and reflects about how implementation should be governed. The first set is the largest in terms of questions and covers market fragmentation, access and cross-borders issues. The remaining ones cover respectively transparent and cost-effective pricing, standardisation, interoperability and security issues. The governance guidance is to apply to existing SEPA schemes (SCT, SDD) as well as cards, e-payments and m-payments.

3.1

The Community wide attitude regarding long-standing and future-oriented payments' issues - apart from SEPA credit transfers and SEPA direct debits - is still pending and is overarching for all operators in the Single Market. The EESC welcomes the Commission's Green Paper and expects proportionate follow-up actions in order to improve current shortfalls. The EESC calls that consumer interests on the availability of safe, efficient, convenient and rapid payments should be put at the centre of every payment transaction.

3.2

The Green Paper concentrates on electronic payments omitting, however, the still dominant role of cash which represents 80 % of payment transactions in Europe. The increased transparency of costs is equally relevant both for electronic payments and cash and should serve as primary reference when analysing non-cash payment means. The impression that cash is free is still common among the general public. Significant efficiency gains could be realised if payers changed their habits by using modern and less costly payments. Moreover, evidence suggests that the prevalence of cash payments has a positive correlation with the level of the shadow economy due to difficult traceability of cash payments. Therefore, the EESC encourages the additional initiatives taken by Member States with the clear support of the Commission in reconsidering the positioning of cash in modern economies.

3.3

In the EESC's view, additional measures aimed at increasing transparency, especially binding ones, should be considered carefully in order not to overload consumers with excessive information, which if provided at a wrong time (e. g. rush hours) and in complicated format could add confusion to shopping experience and disturb the check-out process for merchants.

3.4

International and several domestic card schemes base their business models on interchange fees that have been challenged to different extent by national competition authorities as well as by the Commission. The latter's decision of 2007 prohibiting MasterCard's cross-border interchange fee has been recently upheld by the General Court. The EESC notes that up to now interchange-based business models failed to keep up with SEPA vision, i.e. no difference of fees for cross-border and domestic transactions. Moreover, the self-regulating mechanism that ensured the decrease of interchange levels with the increasing volume of transactions as well as alternative pricing solutions applicable for low-value payments were missing. The EESC urges the Commission to stabilise the long-term business environment for all operators by also taking into account the lessons learned by other regions (e. g. Australia) that have adopted a regulation in this regard and by ensuring a level playing field between different card scheme business models.

3.5

The co-badging of different payment brands either on plastic card or on forthcoming mobile platforms should neither undermine the right of consumers to choose between brands nor restrict possible incentives for merchants. Co-badging is important for new schemes entering the market and consequently facilitates both choice and competition. In some cases one brand places additional mandatory requirements for transactions through its network even they are initiated by another brand. In the EESC's view it should be ensured that one brand should not be in a position to impose such processing requirements.

3.6

The EESC shares the view that the separation of scheme management functions from processing is a key element to create a competitive payments cards market as vertical silos may use cross-subsidising when competing with independent processors. Moreover, the current set-up is less favourable for the envisaged initiatives fostering the interoperability between processors. Therefore, the separation, ideally at corporate level, would enhance the integration and competition processes within a Single Market.

3.7

Under the current legal framework, payment and e-money institutions are not allowed to access payment systems designated under the Settlement Finality Directive. These essentially target large value and retail payments. Should the Commission plan any changes to the current framework, the EESC would urge it to consider the risk element the new participants (i.e. payment institutions and e-money institutions) could bring to the existing payment systems (infrastructures), bearing in mind for instance that they have no access to central bank funding.

3.8

The SEPA Cards Framework (SCF) as originally developed by the EPC should not restrict business models developed by other operators. Ideally, the SCF needs to be carefully reviewed within the new SEPA governance structure taking into account the input of all stakeholders.

3.9

The EESC is concerned that the entities that are neither regulated nor supervised seek access to the sensitive account information. Moreover, the obligations and responsibilities of the operators involved are not properly reflected in the European legal framework and may have unexpected consequences for consumers in case of data misuse or fraud. The access to information on the availability of funds on bank accounts should be carefully analysed taking into account such aspects as security, data protection, consumer rights, competition and compensation to account issuers.

3.10

Surcharging is the possibility for merchants to add a fee to the transaction value if a card is used. This option was recognised throughout the EU since the adoption of the Payment Services Directive, unless a Member State had explicitly prohibited it. The previous experience of surcharging applied in certain cases is not conclusive, at least in the short term. Early 2005 for instance, the Danes responded strongly to the imposition of fees on their domestic debit card scheme transactions, which dropped sharply while ATM cash withdrawals increased. Surveys conducted in other markets confirm this trend. Even though consumers would be protected from abusive surcharging by the Consumers Rights Directive as from 13 June 2014, it is not straightforward how this protection will be ensured in a highly agile online environment. The EESC takes a view that surcharging should not be encouraged as a Pan-European practice.

3.11

The card ecosystem is characterised by the lack of standardisation and interoperability. For instance, the terminal provider needs to go through up to seven certification processes in order to operate at EU level. The EESC calls on the private sector to join forces and produce concrete results, including in terms of implementation framework and ambitious deadlines. However, if market solutions are slow, the Commission should step forward with legislative proposals.

3.12

The availability of e-payment services is mainly restricted within national borders. The EESC calls on the operators of such systems to work on interoperability issues in an open and transparent manner and address missing issues in e-commerce as soon as possible. However, if the market does not deliver the expected results, the Commission should envisage regulatory requirements for the reachability of e-payment schemes at European level.

3.13

The EESC calls on the Commission to make sure that m-payments from the early phase of their development will respect principles of open access to platforms, portability of applications, security as well as avoidance of duplicate costs for operators wishing to accept these payments. Moreover, data protection authorities should support operators in their developing user-friendly solutions.

3.14

Security is key for public trust in payment instruments and should ideally be addressed in the designing phase. In the context of security it is crucial that any provider in the payment value chain is appropriately regulated and supervised. The EESC acknowledges the progress made by market participants in curbing fraud at physical terminals but notes that operators are exposed to fraud in on-line business. Security measures should not undermine customers' convenience and, if proposed by public authorities, should be technologically neutral to the extent possible. In this regard, the EESC welcomes the recommendations of the institutions participating in the SecuRe Pay Forum on the security of internet payments and ultimately their efforts to enhance the security level and public trust in electronic payment services. The correct implementation of these recommendations should be further monitored by the relevant authorities.

3.15

However, curbing fraud requires additional measures among relevant authorities of the Member States. In this regards the EESC welcomes the establishment of a new European Cybercrime Centre at Europol, which will be operational by 1 January 2013 and hopefully will become the competence centre in the EU's fight against fraudsters. This initiative was advocated by the EESC in its own-initiative opinion on combating fraud and counterfeiting of non-cash means of payments adopted on 23 October 2008 (3). The EESC notes that other measures defined in that opinion remain of high importance and should be considered as well.

3.16

Payments involve many stakeholders and their interests, though they may sometimes be diverging, should be taken into account when constructing the future payments landscape. The new SEPA governance should ensure openness, transparency and a level-playing field in this evolving and ambitious project. The EESC welcomes the on-going efforts by the Commission and the European Central Bank to centralise the "ownership" of SEPA, for instance under the umbrella of the SEPA Council. However, the EESC urges to speed up the process as the current de facto vacuum hinders its implementation.

15.11.2012   

EN

Official Journal of the European Union

C 351/57

1.1

The European Economic and Social Committee (EESC) supports the proposal of the European Commission (EC) for a Council Regulation on a European Foundation Statute (EFS), which will allow for the creation of the European Foundation (Fundatio Europaea). The EESC had called for this Statute (1) with the aim of facilitating cross-border activities and cooperation of public benefit foundations in the European Union and thus contributing to the promotion of economic and social cohesion in the EU.

1.2

The EESC now recommends that the European Parliament and the Council adopt the proposal without delay. Indeed, more than ever before, foundations are tackling issues that span national borders, issues that require an efficient organisational form. Foundations at the European level that are active in the areas of science, research and societal issues need a legal form that is recognised in every EU Member State.

1.3

The foundation sector itself and its representative organisations and networks at national and EU levels have repeatedly called for an EFS as the most cost-effective solution for addressing cross-border barriers and thereby stimulating foundation activities across Europe.

1.4

The Fundatio Europaea (FE) will be optional and will not replace local and national legislations. It will, however, give the opportunity to foundations opting for the statute to work in each country of the EU without the need to create local structures, provided that the foundation will be recognised in the country of origin of its creation.

1.5

The EESC agrees that the proposed action fully complies with the subsidiarity principle. EU action is necessary to remove national barriers and current restrictions encountered by foundations when they operate in several Member States. The current situation shows that the problem is not adequately covered by national measures and the transnational character of the matter requires a European framework to ensure the development of foundations whose mission is to work on a European scale. To meet this objective, an action taken by a Member State on its own would not guarantee optimal results in respect of the principle of the single market.

1.6

The rationale of the proposal is to create an innovative legislative framework which will be additional to existing national laws, which will remain unchanged in their form and scope. Member States will retain the ability and choice to maintain and develop national forms of foundations.

1.7

The EESC agrees with the choice of the Regulation for the proposal. It is the most appropriate legal tool to ensure consistency in the Statute in all Member States and to increase trust, as it requires a direct and uniform application of rules. This is further strengthened by Articles 47 and 48 on the cooperation between supervisory authorities, and with tax authorities respectively.

1.8

The EESC agrees with the core features of the EC proposal on an EFS, which aims to strike a balance between easy access to the Statute in terms of formation, and trustworthiness in terms of transparency and accountability.

1.9

The proposal includes tax elements which do not create a new regime but put automatically FEs on an equal footing with national public-benefit entities. This section of the proposal must be reviewed carefully as it must not jeopardise the much needed adoption of the proposed Regulation.

2.1

At Union level there is no possible way to harmonise the legal frameworks in which the public benefit purpose entities carry out their activities in the EU. Some estimated 50+ laws govern the formation and operations of foundations across the EU. Differences between civil and tax laws across the Member States make cross-border operations of those entities costly and cumbersome. In addition, legal, tax and administrative barriers hamper foundations' cross-border work. As a result, the cross-border channelling of funds and support to public benefit purposes remains largely underexploited.

2.2

To address these problems, the Commission tabled a proposal for a Regulation which sets a new European legal form intended to facilitate foundations' establishment and operation in the single market. This legal form will allow foundations to more efficiently channel private funds to public benefit purposes on a cross-border basis in the EU. This, in turn, should result in more funding being available for public benefit purpose activities and therefore, should have a positive impact on European citizens' public good and the EU economy as a whole.

2.3

The proposal lays down the main features of the FE, the methods of formation and the rules concerning organisation of the FE. Furthermore, the possibility of converting the FE back into a public benefit purpose entity or winding up is foreseen under certain conditions.

2.4

The regulation sets minimum supervisory powers of the supervisory authorities in each Member State, in order to enable them to effectively oversee the activities of the FEs registered in that Member State. It also provides for the automatic application to the FE and its donors of the same tax benefits as granted to domestic public benefit purpose entities.

3.1

The EESC has acknowledged in its previous opinion the significant contribution of foundations in numerous areas such as human rights, the protection of minorities, employment and social progress, protection of the environment and the European heritage, and the promotion of scientific and technological advances. They also play a key role in helping to achieve the goals of smart, sustainable and inclusive growth set by the Europe 2020 strategy.

3.2

Within the EU, people, goods, services and capital can generally move freely across borders, something that is not generally true for actions and resources devoted to public benefit purposes. This is the purpose of the creation of an FE, a new optional legal entity that stands alongside those legal forms already existing in EU countries.

3.3

The EESC considers that with the European Foundation Statute, foundations will benefit from more uniform conditions across the EU by using one legal tool and a governing structure which will be comparable in all Member States, and which will give greater legal certainty and fewer compliance costs.

3.4

The Statute will facilitate the pooling and scaling up of their expertise and resources. Having a recognisable European form for foundations will also stimulate cross-border initiatives and donations. Member States' economies are likely to see more funding become available for important fields such as research and education, social and health services, culture or the protection of the environment.

3.5

The EESC welcomes the fact that the EC proposal focuses only on public benefit foundations. It notes that the definition of public benefit purposes set out in Article 5 is based on a closed list of the most common purposes that can be found in the majority of Member States. This provides for increased legal certainty as to what is of public benefit, but may prove very cumbersome to update, as this could only be done by unanimity decision of the Council and consent of the European Parliament at the occasion of the first review of the Regulation seven years after its entry into force.

3.6

The EESC notes that the concept of "serving the public interest at large" could be refined in the Regulation and specify that the FE must have (an) identifiable public benefit purpose(s) and serves the public interest at large and/or a section of the public. The EESC would also recommend that the following elements be considered in determining whether a body provides or intends to provide public benefit:

3.7

The EESC welcomes other core characteristics of the EFS as set out in the proposed Regulation, which it had recommended in a previous opinion, including:

3.8

The EESC notes that the Regulation aims to facilitate the implementation of recent rulings of the European Court of Justice (2) giving the possibility to make transnational donations to FEs and treating the FE as a public benefit foundation under local tax law. The EESC believes that for tax purposes, the FE should be granted standard non-profit status in full respect of the competence and practice of the tax authorities of the Member State where the EF is tax-liable, to determine its tax treatment in accordance with applicable tax regulations at the national level. While the Member States cannot discriminate against FEs vis-à-vis national public benefit foundations, which is contrary to EU treaty and ECJ case law, they have the leeway to choose which tax regime applies. Member States should also specify what tax regime will apply to FEs, when several regimes for not-for profit organisations can be found in their jurisdiction.

3.9

Finally, the proposed Regulation should fully take into account recommendations made by the foundation sector to ensure that the final instrument on the one hand has a genuine European dimension without undue references to national provisions, and, on the other hand, is both comprehensive and straightforward which will maximise its future use.

4.1

As outlined in the aforementioned EESC's opinion, the essential advantages and benefits of the EFS would be fourfold i.e. efficiency and simplification, accountability, economic benefits, and political and citizen benefits. The EESC believes that the proposed Regulation strikes a good balance between these elements, while some proposals could be refined as explained below.

4.2

The EESC wishes to take note of the translation of specific terms in the proposal, namely the concept of public benefit, which in some languages may be translated as public utility or general interest and refer to a very specific type of existing national legal form with an interconnected set of rights and requirements. In particular this could lead to some confusion as to which national public benefit entities would be entitled to convert to an FE, unless this is clearly specified by the Member States.

4.3

The EESC considers that it is up to the Member States to specify which public benefit entities and foundations could convert to an FE or merge to form an FE. This would exclude by definition unincorporated entities, such as trusts, but would cover foundations with public benefit aims which in some EU Member States house non-autonomous funds, as well as public benefit endowed funds.

4.4

The EESC believes that given their public benefit character and tax status, FEs set up in perpetuity should spend their annual income in a reasonable period of time (e.g. within a period of 4 years), while securing the possibility of allocating part of their resources (e.g. one third) to maintain the value of and/or to grow their endowment. The latter would not apply to FEs which are set up for a limited period or to a spend-down foundation.

4.5

The EESC wishes to point out that the EC proposal's requirements in terms of transparency, particularly as far as the issue of external audit is concerned, are more demanding for the FEs in relation to the size of their required assets than existing requirements for national foundations across the EU. This may be a deterrent to the future use of the FE. Audit requirements should be effective only above certain threshold(s) (e.g. EUR 150 000) and/or an average number of at least 50 employees. For FEs with assets less than the proposed EUR 150 000 threshold, an independent examiner could be used instead of an auditor. Indeed, current practices show that 8 Member States do not require external audits, while, where they do, the thresholds may vary from over EUR 15 000 (Estonia) to over EUR 2,5 million (Poland) and employing over 50 staff (3). This proportionate approach as regards auditing does not discharge the FE from fulfilling other transparency and accountability provisions laid out in the Regulation regarding in particular regular (annual) public reporting.

4.6

While the FE should be able to pursue "related" economic activities, i.e. related to its public- benefit mission, the notion of unrelated economic activities may be more difficult to define. It might be clearer to allow the FE to undertake only indirect unrelated economic activities through another legal entity.

4.7

The EESC believes that the Regulation must set out provisions regarding the right of the FE's employees to be informed and consulted at the appropriate transnational level in situations where the FE has a significant number of employees in different Member States as follows:

4.8

The EESC believes that the Regulation as it stands creates de facto some completely new provisions for volunteers, while there is no European status/legal definition of volunteers, or their rights and duties. In the absence of such fundamental elements, the EESC believes that information and consultation of volunteers of the FE should be conducted according to applicable national laws. As regards the practical arrangements for the transnational information and consultation of volunteers, these should be determined primarily by means of an agreement between the parties in the FE. Here the idea is to not circumvent existing laws on and status of volunteers, as well as to not make the use of the FE too complex and cumbersome by adding requirements which are not to be found in real situations. The EESC also believes that volunteers' rights to information and consultation cannot compare with employees'; this would create unprecedented rights and legal complexities.

4.9

The EESC welcomes that the proposed Regulation follows its initial recommendations to delegate the oversight of EFs to competent designated authorities in the Member States on the basis of the commonly agreed EFS standards regarding registration, reporting and supervision requirements set forth in the EFS Regulation. Where such authorities do not already exist, the EESC believes that company registration authorities could play such a role. The EESC considers that it should be left to the discretion of the Member States to designate one or more authorities according to needs and practices.

4.10

Should the EU legislators wish to retain tax elements in the final Regulation, the EESC advises that they take due account of the approach which foundation practitioners would recommend. This could entail for instance a combination of the civil law instrument (the EC Regulation) and tax law requirements that Member States would consider essential (e.g. disbursement of the annual income in a reasonable period of time).

15.11.2012   

EN

Official Journal of the European Union

C 351/61

1.1

The Commission proposal for a directive on the enforcement of the directive on posting of workers is one of the proposals intended on the one hand to strengthen the rules on posting of workers and on the other to codify the existing legislation governing the right to take collective action in cross-border situations. These proposals represent a response to the debate following four EU Court of Justice judgments (Viking-Line, Laval, Rüffert and Luxembourg) about the balance between social rights and economic freedoms.

1.2

The EESC has in two opinions called for strengthening of the rules regarding posting of workers, by among other things clarifying and improving the provisions of the directive on posting of workers and by enhancing cooperation between the authorities of the Member States. The EESC welcomes the aims of the Commission's proposal for an enforcement directive, while stressing the importance of guaranteeing the protection of posted workers, respecting the various labour market models in the Member States and discouraging social dumping and unfair competition. The EESC therefore considers that the EU should put more emphasis on social aspects.

1.3

The EESC welcomes the intention to enforce the existing directive, focusing on better implementation and effective administrative cooperation among Member States. The original Directive plays a key role in promoting a climate of fair competition between all service providers (including those from other Member States) by guaranteeing both a level playing-field and legal certainty for service providers, service recipients, and workers posted for the provision of services.

1.4

In the EESC's view, it is important for the proposal to guarantee protection for posted workers and respect the Member States' different labour market models, but at the same time to increase the scope for cross-border trade, in particular by preventing unnecessary administrative costs.

1.5

In order to promote transnational provision of services in a climate of fair competition, it is important to have equal minimum conditions of employment according to national laws and collective agreements.

1.6

The elements in Article 3(1) of the directive should not be an exhaustive list but be used as part of an overall assessment where all the relevant factors are taken into account.

1.7

The directive should ensure greater respect for the autonomy of the social partners and the role played by them in various labour market models. The EESC reminds Member States of the responsibilities in terms of securing effective controls and considers it very important to review the list of measures after three years.

1.8

To protect the rights of workers the Member States should be able to oblige foreign service providers to designate a contact person with the necessary powers to negotiate on behalf of the company, and Article 11(3) should ensure that host country trade unions and other parties can defend the rights of posted workers in line with national practices.

1.9

The EESC finds the proposal on joint and several liability in subcontracting situations to be a crucial point in the proposed directive. It provides for protection of workers in the sector where subcontracting is most prevalent, while at the same time respecting employers’ need for certainty with respect to their liabilities. The EESC stresses, however, that the proposal must respect existing systems for several and joint liability in the Member States. The EESC strongly recommends Member States that do not have such systems to introduce them after consultation with the social partners. The EESC encourages the Commission, together with the social partners, to provide a more precise definition of due diligence, as has been done in some Member States. The EESC understands the concept of due diligence to mean, without prejudice to the social dialogue at the national level, that companies that perform adequate checks and controls of subcontractors should not be held liable.

2.1

The Commission's proposal for a directive on the enforcement of the directive on posting of workers is part of a package of proposals. Together with the enforcement directive, the Commission has presented a proposal for a regulation codifying the existing legislation governing the right to take collective action in cross-border situations (1). The Commission states that the purpose of both proposals is to create more and better jobs and to increase the EU's competitiveness by updating and improving the single market without compromising the rights of workers.

2.2

The Commission's proposal for a directive on enforcement of the directive on posting of workers includes the following:

3.1

The Commission notes that, although the number of posted workers represents a small proportion of the total EU workforce, there are a large number of posted workers in certain Member States and the phenomenon is becoming more and more common. There is a lack of reliable data, but it is estimated that around one million workers are posted each year. This is a very small proportion of the total workforce – less than 1 % of that of the current Member States – but it makes up around 20 % of cross-border labour mobility. The countries most affected are Germany, France, Luxembourg, Belgium and Poland.

3.2

The Commission proposal follows an intense debate, prompted by four EU Court of Justice judgments (Viking-Line, Laval, Rüffert and Luxembourg), about the balance between social rights and economic freedoms. In October 2008, the European Parliament adopted a resolution in response to the ECJ's judgments. The European social partners conducted a joint analysis of the Court of Justice rulings at the request of the Commission and the French presidency (in the second half of 2008).

3.3

These issues were also raised in the report on the relaunch of the Single Market presented by Professor Mario Monti in 2010. The report recommended guaranteeing and clarifying the application of the right to strike, and introducing a mechanism for informal solutions of labour disputes relating to application of the Directive.

3.4

The EESC addressed the issue of the Court of Justice rulings on the posting of workers directive in two opinions: The Social Dimension of the Single Market  (2) and Single Market Act – Twelve Levers  (3).

The EESC called for the following in its opinions:

4.1

The EESC notes the Commission's proposal for a directive intended to improve the enforcement of the posting of workers directive by clarifying the conditions for posted workers and to improve facilities for the relevant national authorities, companies and workers to cooperate and exchange information. The Committee believes it is important that the proposal should guarantee the protection of posted workers, respect the various labour market models in the Member States and be effective in its purpose of discouraging social dumping and unfair competition, as well as increasing scope for cross-border trade, especially by preventing unnecessary administrative costs. In order to promote the transnational provision of services in a climate of fair competition, it is important to have equal minimum conditions of employment according to national laws and collective agreements.

4.2

The EESC finds legal certainty to be of the utmost importance and notes the legal uncertainty concerning foreign workers who are posted by a temporary agency. These workers are covered by the Posting of Workers Directive and by the Directive on Temporary Agency Work. In order to resolve this ambiguity, the EESC proposes that the Enforcement Directive provide that temporary workers fall within the scope of the Directive, unless more favourable terms and conditions of employment are concluded pursuant to Article 5(3) of the Directive on Temporary Agency Work.

4.3

The Committee's position is that cross-border services are very important to the development of the internal market. In order to create political acceptance for the EU and increase solidarity within the Union, the EU should put more emphasis on the social aspects of its policies. For the full potential of the internal market to be realised, the EU must strengthen the social dimension. The proposal for a directive is a step in the right direction, but it does not do enough to satisfy the Committee's wishes. That would require further clarification and strengthening of the proposal.

4.4

The EESC supports the intention in Article 3(1) of the directive to address the issue of so-called letter-box companies, i.e. companies that have no real activities in the country where they are registered but exist for the sole purpose of avoiding obligations in the host country. In order to ensure clarity, legal certainty and consistency with Article 3(2), the assessment of whether an undertaking genuinely performs substantial activities in the country of establishment should be made through an overall assessment where relevant factors are taken into account, which means that the list should not be seen as exhaustive.

4.5

Article 3(2) of the proposal for a directive is intended to clarify when a worker should be regarded as carrying out his or her work temporarily in another Member State. The distinction between temporary and permanent work in the host country is very important because it determines which country's labour law is to apply and whether the situation can even be considered a posting. The EESC welcomes the clarifications contained in the proposal, in particular the reference to the need for an overall objective assessment.

4.6

The EESC welcomes the new information rules, but considers that Article 5(4) should also express absolute respect for social partners’ autonomy and the role played by the social partners in various labour market models. It is also necessary to ensure that the administrative burden of financing tasks such as translations is not transferred to the social partners. Initiatives taken by sectoral social partners in disseminating information should be supported.

4.7

It is important where checks are concerned (Article 7) that the authorities of the host country should have overall responsibility for monitoring abuse where a worker is posted temporarily from another country, and that the authorities in the country of origin should cooperate with the authorities in the host country. It should also be possible for these checks to be conducted on the initiative of the authorities in the host country and not just on that of the authorities where the company is established.

4.8

Article 9(1)(d) allows Member States to impose an obligation on foreign service providers to designate a contact person to negotiate, if necessary, on behalf of the employer with the relevant social partners in the Member State to which the posting takes place, in accordance with national law and practice. In some countries it may be sufficient to appoint a contact person, as the authorities can ensure compliance with laws and agreements. In other countries, with different labour market models, the contact person should have the power to represent the undertaking with the authorities and trade unions. The directive should therefore allow for different labour market models. Article 11(5)(b) should include a requirement to provide information on social security contributions/taxes and where they were paid.

4.9

Article 11(3) states that the Member States shall ensure that trade unions and other organisations which have a legitimate interest in ensuring that the directive is complied with may engage on behalf of the posted workers or employer in judicial or administrative proceedings. This article should ensure that host country trade unions and other parties can defend the rights of posted workers according to national practices.

4.10

The EESC finds the proposal on joint and several liability in subcontracting situations to be a crucial point in the proposed directive. It provides for protection of workers in the sector where subcontracting is most prevalent, while at the same time respecting employers’ need for certainty with respect to their liabilities. The EESC stresses, however, that the proposal must respect existing systems for several and joint liability in the Member States. The EESC strongly recommends Member States that do not have such systems to introduce them after consultation with the social partners. The EESC encourages the Commission, together with the social partners, to provide a more precise definition of due diligence, as has been done in some Member States. The EESC understands the concept of due diligence to mean, without prejudice to the social dialogue at the national level, that companies that perform adequate checks and controls of subcontractors should not be held liable.

15.11.2012   

EN

Official Journal of the European Union

C 351/65

1.1

The EESC welcomes the proposed Eco-Innovation Action Plan. It would particularly like to highlight the approach adopted in the plan for pinpointing and removing obstacles, as well as for consolidating the drivers behind positive developments.

1.2

It is not possible to have a "one-size-fits-all" definition of the term "eco-innovation", because within society (and between different cultures) there are quite different ideas as to what "innovative" and "progressive" mean. The Commission should therefore establish qualitative and, if possible, even quantitative award criteria which are as clear as possible, for the different areas where it wants to take action.

1.3

Companies which will benefit from the future action plan should be obliged to describe briefly, in a small additional study, where they themselves see the biggest obstacles to implementing their technologies and placing them on the market.

1.4

Eco-innovation supported by the EU must be propitious to resource conservation and be equitable and sustainable. Such support must be linked to the EU's sustainable development strategy criteria.

1.5

Particular attention should be paid to small, appropriate environmental technologies. As far back as its 2004 opinion on the "Realities and prospects for appropriate environmental technologies in the candidate countries" (1), the EESC pointed out that a plethora of alternatives to large-scale, centralised solutions were already in existence or should be developed. Appropriate, decentralised and small-scale technological solutions are often of no interest to research bodies or investors, since very little or no money at all can be made from them precisely because they are cheap, although they are nonetheless effective. The EESC recommends that the Commission incorporate into the new action plan the suggestions set out in that EESC opinion.

1.6

Existing directives and regulations, as well as structural fund and agricultural policy eligibility criteria, must be reviewed at regular intervals to check whether they need to be adjusted to the latest innovations in environmental technology.

1.7

Likewise, the Commission must at last compile the list of environmentally harmful subsidies and gradually abolish them. Nowadays it is no longer appropriate to support eco-innovation with a lot of money and effort, while at the same time contributing to environmental damage by implementing an unsuitable subsidy policy.

2.1

In order to implement and give concrete form to the Europe 2020 Strategy – the Commission's current political planning and governance tool – seven flagship initiatives have been launched, namely:

2.2

The Innovation Union flagship initiative is to be fleshed out inter alia by the Eco-innovation Action Plan (Eco-AP), although other flagship initiatives are also mentioned therein, such as the Resource Efficient Europe initiative and the Agenda for New Skills and Jobs.

2.3

The action plan points out that environmental protection technologies are not only able to open up fast-growing markets, but can also create many new jobs.

2.4

The plan builds on the old "Environmental Technologies Action Plan (ETAP)" from 2004. Its focus, however, is now no longer just on traditional research and the development of new "green" techniques and technologies. The new action plan should be viewed more as a package of measures based on a comprehensive idea of what eco-innovation is about; in addition, it examines the obstacles hindering the introduction of new technologies and how these obstacles can be removed and also the drivers behind the implementation of these technologies and how they can be fostered.

2.5

The Commission document contains interesting results from a survey on this subject, which describe both hindrances and drivers and quantify them to some extent.

2.6

The survey shows that unstable demand from the market and uncertain return on investment are two of the main barriers, while high energy and material prices, new regulations and standards, and access to knowledge are among the main drivers.