Brussels Brief - June 24, 2005
June 24, 2005
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KEY DEVELOPMENTS
Agriculture: EU Sugar Reform
Elena Kostadinova
The European Commission has proposed reforms to the Common Market Organisation for sugar following the Common Agricultural Policy (CAP) reforms of 2003 and 2004. The reforms come two months after the World Trade Organisation (WTO) ruled European Union (EU) sugar policies to be illegal in response to a complaint from Australia, Brazil and Thailand. The reform includes: (i) a 39 per cent price cut over two years beginning in 2006/07, (ii) compensation to farmers at 60 per cent of the price cut, and inclusion of this aid in the Single Farm Payment, (iii) abolition of the intervention system and replacement of the intervention price by a reference price, including introduction of a private storage system as a safety net in case the market price falls below the reference price, and (iv) a voluntary restructuring scheme lasting four years for EU sugar, isoglucose and inulin syrup producers, consisting of a high degressive payment to encourage factory closures. The reform also includes plans to earmark EUR 40 million to provide help to African, Caribbean and Pacific sugar producers that currently export sugar to the EU under a preferential scheme and who will be hurt by the price reduction.
Competition: Commission Adopts Decision on Coca-Cola Commitments
Yannis Virvilis
The European Commission has adopted a decision under the new procedure laid down in Article 9 of Regulation 1/2003, rendering the commitments offered by the Coca-Cola Company and three major bottlers of carbonated soft drinks legally binding. According to the Commission, this decision will benefit consumers because they will have a larger choice of carbonated drinks at better prices. The commitments ensure that Coca-Cola customers will remain free to buy and sell carbonated drinks from any supplier of their choice and that Coca-Cola will no longer offer fidelity rebates to its customers. In addition, Coca-Cola will no longer have the right to require that a customer who only wants to buy one of its best-selling brands, should also purchase other Coca-Cola products. Finally, where Coca-Cola provides a cooler to a retailer and no other chilled beverage capacity is available in that retail outlet, the retailer will be free to use at least 20 per cent of the Coca Cola cooler for any product of its choosing.
State Aid: UK State Aid for Channel Tunnel Rail Freight Services Approved
Nichola Chesaites
The European Commission has approved an extension of the payment of “Minimum User Charges” to English Welsh Scottish Railway International Ltd (EWSI) enabling rail freight services to continue to operate through the Channel Tunnel. Due to insufficient traffic, EWSI is still unable to meet the cost of these charges. The aid, estimated at around EUR 60 million, and for which approval has been extended for the period 1 May 2005 until 30 November 2006, was originally approved in 1998. It serves to compensate EWSI for expenditure on infrastructure and is therefore considered compatible with EU State aid rules. EWSI is to use its best endeavours to maintain freight services at least at a level broadly equivalent to that of today. It will also make traction available to other rail operators, at market rates, thereby reducing barriers to entry for competitors.
Consumer Protection: European Food Safety Authority Officially Inaugurated
Patrice Corbiau
The European Food Safety Authority (EFSA) has been officially inaugurated at its seat in Parma, Italy. This Authority, which has been up and running since early 2003, works as an independent agency to support the work of the European Union (EU) institutions in building on the framework of EU food safety legislation. EFSA has a wide range of responsibilities, from carrying out independent scientific assessments to disseminating new information and networking with other scientific bodies. In particular, EFSA provides risk assessments and material on food safety upon which basis the European Commission proposes regulatory action. EFSA also responds to scientific questions from the European Parliament and Member States and provides the public with understandable scientific information on a wide range of issues. As the globalisation of the food chain is continually throwing up new health risks, EFSA’s work contributes to maintain a high level of consumer protection and food safety throughout Europe.
Mergers: Commission Clears Acquisition of Travelex by Apax
Mélanie Bruneau
The Commission has cleared the proposed acquisition of Travelex Holding Limited (“Travelex”) by the investment funds Apax Europe V and Apax Europe VI (“Apax”). Travelex is mainly active in international payment services, retail and wholesale foreign exchange while Apax is active in private equity and investment funds management. Apax is also the parent company of Global Refund, a leading VAT refund service provider active worldwide, which uses Travelex, in some instances, as a VAT refund agent. The Commission examined the vertical relationship between Global Refund and Travelex and whether Travelex could discriminate against Global Refund’s competitors who seek to use Travelex as an agent. Given the wide range of actual or potential agents in most locations as well as the non-discrimination obligations and price controls imposed by airport authorities on Travelex, the Commission concluded that the transaction will not significantly impede effective competition.
Internal Market: Implementing Deadline for Directive on Markets in Financial Instruments Extended
Javier Berasategi
The European Commission has proposed a new Directive extending by six months (until 30 October 2006) the deadline by which Member States must implement Directive 2004/39/EC on markets in financial instruments (MiFID), previously known as the Investment Services Directive. The proposal also gives firms and markets another six months (until 30 April 2007) to adapt their structures and procedures to the new requirements. Meanwhile, the Commission is inviting comments on its third working document on implementing legislation for MiFID. While the first working document focused on transaction-reporting plus exchange of information between competent authorities and the second on organisational requirements for investment firms, this latest document deals mainly with issues of market transparency.
State Aid: French Aid for Passenger Ferry Annulled at Suit of Competitor
Philip Bentley QC
The Société Nationale Maritime Corse Méditerranée (SNCM) assures the public service obligations of scheduled maritime services between mainland France and Corsica, in return for financial compensation from France. In 2002 France notified the Commission of planned restructuring aid of EUR 76 million for SNCM, which the Commission authorised as being compatible with the common market. Corsica Ferries France (CFF), a competitor of SNCM, challenged the Commission’s decision before the European Court of First Instance (CFI). The CFI annulled the Commission’s decision on the grounds that it had erred in considering whether the amount of aid was at the minimum level necessary for the restructuring of SNCM. In particular, the Commission manifestly underestimated the amount of EUR 21 million available to SNCM from its own resources through sale of ships and failed to take into consideration the EUR 12 million available from sale of real property assets.
Environment: More Coal Use Pushes up EU Greenhouse Gas Emissions in 2003
Elena Kostadinova
The European Union has announced that its carbon-dioxide emissions rose in 2003, but it remains confident that it will meet its long-term goal of limiting the gases responsible for global warming. Emissions of carbon dioxide (CO2) and other greenhouse gases rose by 1.5 per cent in the EU-25 in 2003 compared with 2002 according to the latest inventory report by the European Environment Agency. EU-15 emissions went up by 1.3 per cent. Under the Kyoto Protocol on climate change, the EU-15 have to cut their combined greenhouse gas emissions, averaged over the 2008-2012 period, to 8 per cent below the 1990 level. EU emissions of greenhouse gases increased in 2003 due mainly to the rise in coal use for electricity generation. However, the European Environment Commissioner is confident that the EU will meet its Kyoto targets once new EU measures taken since 2003 are taken into account in the statistics. These include the EU Emissions Trading Scheme for CO2, which entered into force on 1 January 2005, the Directives on the taxation of energy products and the promotion of biofuels in transport.
NEXT WEEK’S EVENTS
Monday 27 June – Friday 1 July 2005
COUNCIL MEETINGS
Transport, Telecommmunications and Energy Council (27 – 28 June 2005)
COURT OF JUSTICE
Judgments
Agriculture
C-295/03 P Alessandrini and Others v Commission
Approximation of laws
C-537/03 Candolin and Others
C-30/05 Commission v Luxembourg
Competition
C-189/02 P Dansk Rørindustri v Commission
C-202/02 P Isoplus and Others v Commission
C-205/02 P Ke Kelit v Commission
C-206/02 P LR af 1998 v Commission
C-207/02 P Brugg Rohrsysteme v Commission
C-208/02 P LR af 1998 (Deutschland) v Commission
C-213/02 P ABB Asea Brown Boveri v Commission
Intellectual property
C-286/04 P Eurocermex v Office for Harmonization in the Internal Market
Principles of Community law
C-28/04 Tod's and Tod's France
Taxation
C-165/03 Längst and Others
Opinions
Agriculture
C-461/03 Gaston Schul Douane-expediteur
Community own resources
C-201/04 Molenbergnatie
Competition
C-451/03 Servizi Ausiliari Dottori Commercialisti
ELSJ
C-443/03 Leffler
European citizenship
C-96/04 Familiensache : Standesamt Stadt Niebüll (désignation du nom de naissance de l'enfant Leonhard-Matthias)
Freedom of movement for persons
C-330/03 Colegio de Ingenieros de Caminos, Canales y Puertos
Free movement of capital
C-513/03 van Hilten-van der Heijden
Free movement of goods
C-366/04 Schwarz
Social policy
C-144/04 Mangold
COURT OF FIRST INSTANCE
Judgments
Environment and consumers
T-158/03 Industrias Químicas del Vallés v Commission
Intellectual property
T-301/03 Canali Ireland v OHMI - Canal Jean (CANAL JEAN CO. NEW YORK)
Social policy
T-347/03 Branco v Commission
Staff Regulations of Officials
T-190/03 Olesen v Commission
T-439/03 Eppe v Parliament
