Brussels Brief - October 27, 2006
October 27, 2006
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KEY DEVELOPMENTS
Trade: Chinese Shoemakers Consider Challenge to EU Anti-Dumping Duties
Michal Cieplinski
China’s Aokang Group has hired legal counsel to challenge the European Union’s decision to impose anti-dumping duties on shoe imports. Aokang Group, China’s largest privately owned shoemaker, is preparing to file a challenge on the grounds that the new duties on Chinese shoes infringe EU/WTO law. Other Chinese shoe manufacturers are expected to follow Aokang’s lead. The challenge is supported by the Chinese Ministry of Commerce which claims that the anti-dumping measures taken by the EU lack sufficient legal and factual basis and could cause the closure of over 1,000 Chinese businesses. It is not yet known whether the challenge will be filed at the European Court of First Instance or via the Chinese Government before the WTO.
State Aid: Commission Prolongs Specific State Aid Rules for Shipbuilding
Patrice Corbiau
The European Commission has decided to prolong the Framework on State aid rules for shipbuilding by two years, until 31 December 2008. The current Framework, which came into force on 1 January 2004, takes into account the particularities that distinguish shipbuilding from other industries. In particular, this Framework contains favourable rules on innovation which allow State aid to shipbuilding of up to 20 per cent of the expenditure related to the innovative parts of projects. These rules, which are unique in EU State aid law, are designed to encourage shipyards to truly innovate and carry out projects that they would not undertake in the absence of public support. Since this Framework has been applied for a limited period of time and since only a few cases have been assessed under its rules, the Commission has come to the conclusion that it needs to acquire more experience with these rules prior to reviewing them.
Environment: Air Quality Directive to Second Reading in EU Parliament
Elena Kostadinova
The EU Council has achieved political agreement to reduce pollution thresholds in the EU Directive on ambient air quality and cleaner air for Europe, thus taking a stronger position than the EU Parliament. The Directive is one of the measures proposed pursuant to EU strategy on air pollution. This strategy establishes ambitious targets for improving human health and environmental quality by 2020 and includes a proposal to limit pollution from transport, agriculture and small industrial plants not covered by existing EU legislation. The Directive on air quality will consolidate EU clean-air legislation and introduce a limit on airborne concentrations of fine dust particles (particulate matter of a diameter less than 2.5 micrometers), which are believed to contribute annually to the premature deaths of 350,000 people across the EU. In addition, the Directive will require Member States to reduce people's exposure to this group of particles by 20 per cent between 2010 and 2019. The Directive will be subject to a second reading in the EU Parliament in 2007.
Consumer Protection: Commission Adopts Communication on Reducing Alcohol-Related Harm
Alexandra Rogers
The European Commission has adopted a Communication setting out a strategy to assist Member States in reducing alcohol-related harm. The document defines alcohol-related problems and emphasises the negative impact that hazardous alcohol consumption is having in the European Union. The document also outlines key areas of concern: drinking and driving, under-age drinking, commercial communications, consumer information, availability and price, protection of third parties, and data and research. Although Member States will retain the main responsibility for national alcohol policies, the Commission aims to promote co-operation and co-ordination between Member States. EU participation will involve the funding of projects through the Public Health and Research Programmes, facilitating the exchange of good practice information between Member States, and supporting education schemes. The Commission has also confirmed that it has no intention of implementing the strategy through new legislation.
State Aid: Commission Inquiry into France’s Guarantee to Finnish Electricity Producer TVO
Maria Scimemi
The European Commission has launched an in-depth investigation under EU State aid rules into France’s guarantee of a €570 million loan granted to the Finnish electricity producer, Teollisuuden Voima Oy (TVO), by a banking syndicate. The purpose of the loan was to enable TVO to purchase equipment from the French company, Areva/Framatome. The Commission’s initial investigation did not enable it to exclude the possibility that the provision of the guarantee has lowered TVO’s financial costs below the levels corresponding to market conditions. Through the in-depth investigation, the Commission aims to take a final view on the compatibility of the measure with the Single Market, having regard, in particular, to the amount of the guarantee premium paid by TVO.
Food Safety: GMO Test Imposed on Imports of US Long-Grain Rice
Philip Torbøl
The European Commission has obtained approval from the EU Member States to require mandatory testing for unauthorised genetically modified (GM) rice in all imports of long-grain rice from the United States. This decision follows two weeks of negotiations in which US authorities failed to satisfy EU demands for a common sampling and testing protocol ensuring consistent and accurate testing of long-grain rice consignments prior to their exportation to Europe. The measures are taken following the discovery four weeks ago of GM rice, LLRICE601, in long-grain rice imports from the US that had been certified free of GM products (see Brussels Brief of 15 September 2006). The tests will also be able to detect another unauthorised GM rice, LLRICE62, traces of which were recently found in US rice consignments to France.
State Aid: Commission Adopts Block Exemption Regulation for Regional Aid
Yannis Virvilis
The European Commission has adopted a new block exemption Regulation for aid promoting economic development of disadvantaged EU regions. Under this Regulation, regional investment aid schemes will no longer have to be notified by Member States if they fulfil a number of conditions, in particular that the Member State in question is able to calculate precisely the aid intensity as a percentage of the investment costs before the aid is granted, without the need for a risk assessment. Pursuant to Article 87(3) of the EC Treaty, State aid granted to promote the development of certain disadvantaged areas within the EU can be considered compatible with the Single Market. The new Regulation is based on the new Guidelines adopted in December 2005 for regional aid for the period 2007-2013.
Environment: Council Adopts New Directive on the Health of Farmed Fish
Geert Dierickx
The EU Council has adopted a new Directive, proposed by the Commission last year, aiming to improve the health of farmed fish in the EU by upgrading the current legislation and introducing a series of new measures. These new measures include more emphasis on disease prevention by applying stronger controls at each point in the production chain. In setting out clear-cut and harmonised EU rules, the new legislation should also help to boost competitiveness in the EU aquaculture sector and facilitate increased trade in fishery products.
Monday 30 October – Friday 3 November 2006
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