Brussels Brief - May 27, 2005
May 27, 2005
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KEY DEVELOPMENTS
Mergers: Joint Venture between Belgacom and Swisscom Approved by the Commission
Mélanie Bruneau
The European Commission has cleared the proposed joint venture for wholesale international telecommunications carrier services between Belgacom and Swisscom, the incumbent telecommunications operators in Belgium and in Switzerland, respectively. Under the proposed transaction, Swisscom will transfer its international telecommunications carrier services activities to BCIS, a company created by Belgacom in 2005 through a spin-off of all its existing international telecommunications carrier services activities and related assets. In return, Swisscom will take a 50 per cent shareholding in BCIS, Belgacom retaining the other 50 per cent. Despite Belgacom’s strong position in several Belgian telecommunications markets, the Commission concluded that the transaction does not raise horizontal or vertical competition concerns, and will not have a significant impact on the market for wholesale international telecommunications carrier services.
Trade: US-EU Dispute over Aid to Boeing and Airbus
Philip Torbøl
Disputes between the United States (US) and the European Union (EU) over their respective aid to Boeing and Airbus could be brought back before the World Trade Organisation (WTO). This follows a request by Airbus for United Kingdom (UK) aid to launch the European aviation giant’s A350 long-haul plane. In October 2004 the US lodged a complaint with the WTO regarding EU subsidies to Toulouse-based Airbus. In reply the EU alleged that certain defence research contracts constituted indirect US Government aid. In January 2005, the parties agreed to suspend their actions for 90 days to negotiate a phasing-out of the subsidies, but failed to reach agreement. EU Trade Commissioner, Peter Mandelson, has called for negotiations to be continued, arguing that litigation will not help. However, the US Government, while defending its defence contracts with Boeing, says that additional aid to Airbus, such as that requested for the launch of A-350, would trigger renewed US action before the WTO.
Environment: Emissions Trading - Commission Approves Italian Allocation Plan
Elena Kostadinova
The European Commission has accepted Italy’s plan for allocating CO2 emission allowances to Italian companies for the 2005-2007 trading period. Under the Kyoto agreement the EU has to reduce its emissions of greenhouse gases between 2008 and 2012 by at least 8 per cent below 1990 levels. Under the EU scheme, qualifying installations will be granted “emissions allowances” which can be traded throughout the EU. Member States must develop national allocation plans, including the total quantity of allowances for a specific period and the rules for allocation. The Commission objected to Italy’s initial proposal to allocate allowances for an average of 255.5 million tonnes of CO2 per year. Italy has now reduced its proposed allocation to 232.5 million tonnes, covering 1,240 installations, all of which qualify for trading. The Commission has now assessed the plans of 24 Member States. Assessment of Greece’s plan will be concluded soon.
Information Society: The Scope of the Universal Service Directive Should Remain Unchanged
Elena Kostadinova
The Universal Service Directive, in place since 2002, seeks to safeguard affordable access to communications services for all throughout the EU. Pursuant to Article 15 of the Directive, the Commission has published the results of its first examination of whether the current scope of universal service should be changed or redefined in the light of technological, social and economic developments, taking into account in particular mobility and data rates. It has concluded that there is no need to introduce new legal requirements for mobile and high-speed internet services at the moment because there is currently widespread affordable access to mobile communications, while broadband internet has not yet become necessary for normal participation in society. The deadline for comments on the Commission’s findings is 15 July 2005. The final position of the Commission is expected before the end of 2005.
Mergers: Commission Clears Reuters’ Acquisition of Telerate with Conditions
Yannis Virvilis
Following close cooperation with the US Department of Justice, the European Commission has imposed conditions on its clearance of the proposed acquisition of the financial data provider, Moneyline Telerate, by its major competitor, Reuters Limited. The Commission had recourse to the new referral mechanism in order to be able to examine a merger which would otherwise have had to be reviewed by 12 different Member State authorities. The Commission investigated two markets, the supply of real-time market data, and market data platforms (MDPs). For the first market the Commission found that no competition problems would arise out of the concentration. However, in respect of MDPs the Commission found that the parties are the only major providers and that their combination would lead to an incontestable worldwide market position. To remedy this, the parties agreed to grant a perpetual exclusive global licence for MDP products to US Hyperfeed Technologies, a provider of financial market data technology.
Consumer protection: EFSA Opinions on Two GM Foods
Philip Bentley QC
The European Food Safety Authority (EFSA) is responsible for the scientific assessment of genetically modified (GM) food and feed, which is an essential step in the political and legislative process of authorisation under regulation (EC) No 1829/2003. EFSA has just published two statements apparently designed to avoid misunderstandings about two recent opinions of its Scientific Panel on genetically modified organisms (GMOs). The first opinion concludes that Bt11 maize (not to be confused with Bt10 maize recently found to contaminate corn gluten coming from the US) will not cause an adverse effect on human health or the environment in the context of its proposed use. The second concludes that MON 863 maize is as safe as its conventional counterpart (not to be confused with the hybrid MON 863 x MON 810 for which a further study was requested and is currently under evaluation).
European Court of Justice: French Challenge against Ban on Cosmetics Tested on Animals Defeated
Nicola Chesaites
On 24 May 2005 the European Court of Justice (ECJ) ruled inadmissible the request of the French Government for partial annulment of Directive 2003/15/EC relating to cosmetic products. France sought to contest the legality of a provision in the Directive introducing a ban on animal testing for cosmetic products, a gradual ban in respect of ingredients for cosmetic products tested on animals, as well as a marketing ban on cosmetic products that have been the subject of animal testing or where their ingredients have been the subject of animal testing. The marketing ban is, however, subject to the existence of alternative testing methods that have been validated and adopted at EU level. The French, who lead the cosmetics industry in the EU, argued that the protection of animals is not an EU objective of sufficient general interest to justify such a restriction of the freedom to exercise professional activity. The provision in question, the result of almost ten years of legislative bargaining within the EU, was found to be one of the principle axes of the Directive and as such, could not be severed from the rest of the Directive. For this reason, the ECJ ruled that France’s application for annulment was inadmissible because partial annulment of the Directive would objectively alter the very substance of the provisions adopted by the EU legislature with regard to testing cosmetic products on animals.
NEXT WEEK’S EVENTS
Monday 30 May – Friday 3 June 2005
COUNCIL MEETINGS
Agriculture and Fisheries Council (30 May 2005)
Employment, Social Policy, Health and Consumer Affairs (2 – 3 June 2005)
Justice and Home Affairs Council (2 – 3 June 2005)
COURT OF JUSTICE
Judgments
Agriculture
C-330/04 Commission v Italy
Company law
C-394/02 Commission v Greece
C-15/04 Koppensteiner
Competition
C-53/03 Syfait and Others
Environment and consumers
C-282/02 Commission v Ireland
C-83/03 Commission v Italy
C-68/04 Commission v Greece
Freedom of movement for persons
C-136/03 Dörr and Ünal
C-454/04 Commission v Luxembourg
Freedom to provide services
C-89/04 Mediakabel
Free movement of capital
C-174/04 Commission v Italy
Free movement of goods
C-438/02 Hanner
Taxation
C-378/02 Waterschap Zeeuws Vlaanderen
Transport
C-266/03 Commission v Luxembourg
Opinions
Company law
C-525/03 Commission v Italy
Competition
C-334/03 Commission v Portugal
Environment and consumers
C-127/04 Master Declan O'Byrne
C-229/04 Crailsheimer Volksbank
Freedom of movement for persons
C-441/02 Commission v Germany
Industrial policy
C-33/04 Commission v Luxembourg
Intellectual property
C-37/03 P BioID v Office for Harmonization in the Internal Market
COURT OF FIRST INSTANCE
Judgments
Regional policy
T-272/02 Comune di Napoli v Commission
Staff Regulations of Officials
T-284/02 Dionyssopoulou v Council
T-105/03 Dionyssopoulou v Council
T-294/03 Gibault v Commission
