Brussels Brief - April 29, 2005
April 29, 2005
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KEY DEVELOPMENTS
Trade: Commission Launches Safeguard Procedure against Chinese Textiles
Philip Torbøl
Over the next two months, the European Commission will be investigating imports of Chinese textiles in nine product categories and will establish whether these have caused “market disruption” in the European Union (EU). The procedure could ultimately lead to a re-introduction of import quotas for these products, the imports of which have increased by between 51 per cent to 534 per cent since the beginning of the year. The nine product categories are T-shirts, pullovers, blouses, stockings and socks, men’s trousers, women’s overcoats, brassieres, flax or ramie yarn and woven fabrics flax. If the investigation shows that market disruption has indeed occurred, the Commission will initiate formal consultation with China at the end of the two-month period. However, should massive and imminent damage to the European textiles producers be evident at any time, the Commission could move directly to formal consultations without delay. If no agreement is reached following such consultations, the Commission may introduce safeguard measures limiting the import increase to 7.5 per cent on an annualised basis.
Trade: Council Approves Retaliation against Byrd Amendment
Nicola Chesaites
On 25 April 2005 the Council of the EU adopted the European Commission’s proposal to impose additional customs duties on certain United States (US) imports in retaliation against the so-called Byrd Amendment (see Brussels Brief, 8 April 2005). Additional duties of 15 per cent will take effect as of 1 May 2005 on certain agricultural, textile, machinery and paper products imported from the US and will continue to be imposed until the US ceases to apply the Byrd Amendment. Currently, however, a substantial increase in the forthcoming annual payments under the illegal US rules are anticipated. This would trigger an increase in the rate of additional customs duties that the EU could impose on US imports or an extension of the list of products to which those duties apply under the rules adopted by the Council. Canada, another of the ten countries authorised by the World Trade Organisation (WTO) to charge additional customs duties, will also impose such duties along with the EU from 1 May 2005.
Mergers: Commission Opens Second Phase Investigation into Johnson & Johnson’s Take-Over of Guidant
Yannis Virvilis
The European Commission has opened an in-depth investigation into the planned acquisition by the US healthcare group, Johnson & Johnson, of its competitor Guidant Corporation, a US company specialised in cardiovascular products. Based on its initial investigation, the Commission found that the acquisition could create competition problems because of the two parties’ horizontal overlaps in the markets for medical devices for the treatment of coronary and peripheral artery diseases and for cardiac surgery. The Commission also found that there is only a limited number of leading companies in Europe and worldwide in the markets in question. It now has approximately four months to take a final decision on this matter.
Mergers: Commission Approves Acquisition of Radianz by BT
Mélanie Bruneau
The European Commission has approved the acquisition by BT Group plc of the company Radianz. BT, based in the UK, provides telecommunication services on a worldwide basis. Radianz, a US-based company, is a provider of financial extranet services. Its shared infrastructure, called RadianzNet, enables financial companies to exchange information and execute trades over this secure extranet hub. The Commission has approved the acquisition, as the parties’ activities do not overlap and as alternative players can enter the market. Moreover, the Commission has considered that the vertical integration will not create a negative impact on the market for the provision of extranet services to the financial community nor on the upstream market for global telecommunication services.
Competition: Maritime Consortia Block Exemption Renewed
Javier Berasategi
The European Commission has renewed until 25 April 2010 a block exemption allowing shipping companies to enter into consortium agreements covering the maritime transport of cargo to or from one or more EU ports. The block exemption, first adopted in 1995 and previously renewed in 2000, automatically covers liner shipping consortia which have a market share of below 30 per cent (or 35 per cent if operated outside a so-called liner conference). The Commission has also introduced some minor amendments, including the notice period for penalty-free withdrawal from a consortium which has been extended by six months to a total of 24 months. In addition, this initial period now applies where the parties to an existing agreement have agreed to make substantial new investment in the maritime transport services offered by the consortium. Finally, one of the basic conditions for the grant of exemption to a consortium, namely the existence of effective price competition within the consortium, has been amended to take into account ‘individual confidential contracts’.
Internet: .eu Registration Expected at the End of 2005
Patrice Corbiau
The Board of Internet Corporation for Assigned Names and Numbers (ICANN) and EURid, the .eu registry, have reached an agreement on 21 March 2005. This agreement, now approved by the European Commission, confirms ICANN’s official recognition that EURid will be the organisation appointed by the European Union to operate the .eu Top Level Domain (TLD) for the next five years. Further to this agreement, the Internet Assigned Numbers Authority (IANA) will put the .eu TLD in the Internet root as soon as EURid has completed the final technical preparations. Before EURid can accept the first applications to register .eu names, it must accredit registrars (who will register domains on behalf of end users) and agree the details of registration policy with the Commission and other interested parties. End users should have the opportunity to register for the .eu extension at the end of 2005.
Environment: Commission Summons Five Member States to Lift GMO Bans
Philip Bentley QC
The European Commission has threatened Austria, France, Germany, Greece and Luxembourg with proceedings before the European Court of Justice (ECJ) if they do not lift their bans on the marketing of genetically modified organisms (GMOs). Under the “safeguard” clause of Directive 90/220/EEC, these Member States claimed that they were entitled to ban the marketing of certain approved GMOs on the grounds of a risk to human health or the environment. The competent EU Scientific Committee found, however, that the evidence provided by these Member States did not justify withdrawal of the original EU-wide marketing authorisation. The Commission now has two options. One is to pursue the regulatory “comitology” procedure, which would probably result in inaction at EU Council level, whereupon the Commission could itself take a decision requiring these Member States to withdraw their bans. The other is to commence infringement proceedings before the ECJ. The Commission has chosen the latter, no doubt because it is politically neutral.
NEXT WEEK’S EVENTS
Monday 2 May – Friday 6 May 2005
COUNCIL MEETINGS
No meetings scheduled for next week
COURT OF JUSTICE
Judgments
Company law
Joined Cases C-387/02, C-391/02, C-403/02 Berlusconi
Social policy
C-335/04 Commission v Austria
Opinions
New accessions
C-293/02 Jersey Produce Marketing Organisation
Social security for migrant workers
C-30/04 Koschitzki
COURT OF FIRST INSTANCE
Judgments
Intellectual property
T-22/04 Reemark v OHMI - Bluenet (Westlife)
T-359/02 Chum v OHMI - Star TV (STAR TV
Staff Regulations of Officials
T-398/03 Castets v Commission
T-30/04 Sena v AESA
