Brussels Brief - April 20, 2007
April 20, 2007
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KEY DEVELOPMENTS
Competition: Commission Fines Dutch Beer Cartel Members
Yannis Virvilis
The European Commission has imposed fines totalling EUR 273 million on the participants of a beer cartel in the Netherlands. This is the fourth national beer cartel uncovered by the Commission, the other three being in Belgium, Luxembourg and France. A fifth investigation in Italy closed without any charges being brought. The biggest fine in this latest case was imposed on Heineken (EUR 220 million), while the other companies fined were Grolsch and Bavaria. InBev, as the “whistle-blower”, received full immunity. What is remarkable is that the proceedings in this case lasted more than seven years, leading the Commission to reduce the fines for every company by EUR 100,000.
Competition: Statement of Objections in Alleged Cartel for Transport of Bulk Liquids by Sea
Juan Gutiérrez
The European Commission has confirmed sending a Statement of Objections to a number of undertakings, alleging a cartel arrangement for bulk shipping of liquids on deep sea routes. The Statement of Objections alleges that the undertakings concerned were involved in customer allocation, bid-rigging, price-fixing and the exchange of confidential market information. The Statement of Objections is based on information gathered during unannounced inspections carried out by the Commission in February 2003. Subsequently additional information was provided under the Commission's Leniency Notice.
Biotechnology: Commission Reviews Strategy on Life Sciences and Biotechnology
Bróna Heenan
As part of a mid-term strategy review, the European Commission has proposed some revisions in the areas of life sciences and biotechnology. These include steps to promote knowledge transfer by improving links between research organisations and industry, and the mobilisation of public and private funding. An example of the latter is the implementation of the Joint Technology Initiative on Innovative Medicine. The Commission will also encourage wide ranging informed debate on the risks and benefits in life sciences and biotechnology. Important issues include the use of human embryonic stem cells, animal cloning and genetic testing. The Commission will also ensure a sustainable contribution of modern biotechnology to agriculture. The Commission has dedicated funding of approximately EUR 8 billion in its seventh Framework Programme (2007-2013), EUR 6 billion to support health research and EUR 2 billion to support research into food, agriculture, fisheries and biotechnology.
Trade: South Korea to Start FTA Negotiations with EU in May
Marta Becerra
According to Korean President Roh Moo-Hyun, South Korea’s Free Trade Agreement (FTA) talks with the EU could be launched next May without significant resistance from the South Korean public. This declaration follows violent protests that took place during the negotiations for an FTA with the US, which was concluded on 1 April 2007. Following the European Commission’s Communication “Global Europe, Competing in the World”, South Korea, Asia’s third largest economy, has emerged as a priority FTA partner for the EU. Last year’s bilateral trade amounted to US$ 71 billion.
Institutions: Commission Launches Consultations on Access to Documents Regulation
Alana Tervo
The European Transparency Initiative aims to increase openness and accessibility of EU institutions, raise awareness over the use of the EU budget and make the EU institutions more accountable to the public. As part of this initiative the European Commission has launched consultations on the Regulation regarding public access to European Parliament, Council and Commission documents. These consultations were launched with a view to granting citizens better and easier access to documents of the Community institutions and agencies. The Commission has published a Green Paper, which contains an analysis of the implementation of the Regulation and relevant case law and suggestions for improvement, and opened a dedicated website. The consultations are open to the public at large and will last until 15 July 2007.
Environment: Hungary Dissatisfied with Decision on its NAP for 2008-2012 Emissions Trading Period
Elena Kostadinova
Hungary is dissatisfied with the changes that the European Commission has imposed on its national allocation plan (NAP) for the 2008 – 2012 period. In particular, the Commission rejected allocation of allowances to sectors which did not report emissions in 2005. This is the 19th NAP assessed by the Commission. NAPs determine (i) each Member States’ “cap” on the total amount of CO2 emitted by national installations and (ii) the number of emission allowances for each installation. The Commission approved Hungary’s annual allocation of 26.9 million tonnes of CO2 allowances, 12.4 per cent less than proposed. Hungary is considering whether to challenge the Commission’s decision before the European Court of Justice, a step already made by Slovakia and also being contemplated by the Czech Republic and Poland.
Taxation: ECJ Finds German Write-Down Losses on Shares Illegal
Geert Dierickx
Pursuant to Germany’s corporation tax law, German companies are taxed on their worldwide profits. With respect to the calculation of the profits, partial write-downs of a shareholding’s book value constitute operating expenses deductible in calculating profits. Remaining losses may be deducted in other years and carried back or forward as tax losses. However, the tax offsetting of such partial write-downs has been treated differently depending on whether the subsidiary concerned is established within or outside Germany. Losses from partial write-downs on shares in a German company can be offset against all the taxpayer’s income. The write-down losses related to shares in a foreign company can only be offset against foreign income of the same origin. According to the European Court of Justice (ECJ) (Case C-347/04), these German rules restrict freedom of establishment.
Environment: Commission to Act Against Shipping Emissions
Jérôme Cloarec
The European Commission will propose including shipping companies in the emissions trading scheme (ETS), the EU's principal tool for fighting global warming. In doing so, the Commission is reacting to the lack of concrete measures that should have been taken by the International Maritime Organisation to fight CO2 emissions. It is not yet known how and when the industry will be included in the ETS, but the Commission should draft legislation by the end of 2007. Global CO2 emissions from shipping are expected to increase by 75 per cent in the next 15 to 20 years. It is also becoming the biggest source of air pollution in the EU, which controls 41 per cent of the world's fleet.
NEXT WEEK’S EVENTS
Monday 23 April – Friday 27 April 2007
COUNCIL MEETINGS
General Affairs and External Relations Council (23 – 24 April 2007)
COURT OF JUSTICE
Judgments
Environment and consumers
C-135/05 Commission v Italy
Free movement of goods
C-348/04 Boehringer Ingelheim and Others
C-195/04 Commission v Finland
Intellectual property
C-412/05 P Alcon v Office for Harmonisation in the Internal Market
Social policy
C-358/06 Commission v Greece
Taxation
C-392/05 Alevizos
Transport
C-523/04 Commission v Netherlands
Opinions
Area of Freedom, Security and Justice
C-2/06 Kempter
Competition
C-202/06 P Cementbouw Handel & Industrie v Commission
Environment and consumers
C-186/06 Commission v Spain
Free movement of capital
C-451/05 Elisa
COURT OF FIRST INSTANCE
Judgments
Competition
T-109/02 Bolloré v Commission
T-126/02 M-real Zanders v Commission
T-129/02 Torraspapel v Commission
T-136/02 Papelera Guipuzcoana de Zicuñaga v Commission
T-132/02 Distribuidora Vizcaína de Papeles v Commission
T-128/02 Papeteries Mougeot v Commission
T-125/02 Papierfabrik August Koehler v Commission
T-118/02 Arjo Wiggins Appleton v Commission
T-122/02 Mitsubishi HiTec Paper Bielefeld v Commission
Law governing the institutions
T-264/04 WWF European Policy Programme v Council
