State Aid: Rescue Aid for Volare Airlines
Under its rules on rescue aid, the European Commission has allowed Italy to guarantee a liquidity loan of EUR 25 million to Volare Airlines SpA. It is the first time that Volare Airlines has benefited from any rescue aid. The aid in the form of a guarantee is limited to six months, and the loan meets the Commission's requirements for a minimum interest rate. In addition, the aid is granted on the grounds of serious social difficulties, threatening over 900 jobs, and is limited to that necessary to keep the company in business during these six months. Italy has undertaken to terminate the guarantee within eight days in the event that plans to sell the airline business of the company are realised.
Trade: EU Ends Procurement Sanctions Against US
Philip Bentley QC
In response to the lifting of US sanctions against certain EU Member States in the procurement area, the EU has ended its counter-sanctions against the US. The US complaint was that the EU 1993 Directive on procurement by utilities allowed Member States to give a three per cent price preference to EU suppliers, thus discriminating against US operators, especially in the telecoms sector. Since then, the EU telecoms market has become fully liberalised and so the US agreed to lift its sanctions on 1 March 2006, thereby enabling the EU to do likewise. It should be noted that the sanctions did not apply to contracts covered by the WTO Agreement on Government Procurement, to which both the EU and the US are signatories.
Internal Market: Commission Threatens Action on Clearing and Settlement of Securities
Unless market players come forward with effective and realistic changes to improve the clearing and settlement of securities (“CSS”) before the summer break, the European Commission will take action designed to enhance competition, reduce costs and speed up cross-border CSS systems. In the period 2001-2003 the Giovannini reports identified 15 public and private sector barriers to efficient and safe cross-border CSS and the Commission published a communication describing possible policies to tackle these inefficiencies. The industry suggested that they could make the necessary changes over a period of two years. However, in the absence of sufficient progress by the industry, the Commission has now issued its ultimatum.
Agriculture: EU Member States Agree to Cut Sugar Production
The European Commission reports that the EU Member States have agreed to its proposal for a 2.5 million ton (13.6 per cent) cut in the production of sugar, isoglucose, and inulin syrup production for one year. The proposed production cuts, which will be divided among Member States, are intended to facilitate the introduction of Europe’s new sugar regime by relieving pressure on the market. Surplus sugar production could impede implementation of the sugar reform due to (i) limited export possibilities, given WTO and budgetary constraints and (ii) the fact that the effects of the new sugar regime will not yet have been felt. The proposed cuts are thus expected to improve balance on the sugar market without creating new stocks of sugar. For more details on the EU sugar reform see Brussels Brief of 24 June 2005, 2 December 2005 and 24 February 2006.
Public Procurement: Consultation on CPV
The European Commission has launched consultations asking public authorities and businesses for their views on the updated version of the Common Procurement Vocabulary (CPV). The CPV is the EU-wide classification system that standardises the references used by contracting authorities to describe the subject matter of public procurement contracts. By inserting a nine-digit code corresponding to the field of interest, businesses are able to identify public procurement contracts offered by EU public authorities irrespective of the language of the tender notice.
Energy: Commission Proposal for EU Energy Strategy
A week before the G8 Energy Minsters’ meeting in Moscow, the European Commission has published a Green Paper on a European Strategy for Sustainable, Competitive and Secure Energy. The Paper provides new impetus for the completion of the internal energy market by proposing, inter alia, a European energy grid code and a European Energy Regulator. In point of fact, the Energy Strategy has a much larger scope encompassing security of supply, energy efficiency and sustainable energy practices to reduce environmental damage. The Commission proposes a common EU Energy Policy designed and controlled at EU level as a tool that will enable Europe to lead the search for energy solutions worldwide.
Consumer Protection: Rise in Non-Food Dangerous Products Identified in the EU
The European Commission has published its “Rapid Alert System” report for 2005. The main conclusion is that the number of non-food dangerous products marketed within the EU has risen sharply during the last year. Pursuant to the “Rapid Alert System”, Member States notify the Commission of the presence on their markets of products (other than food, pharmaceutical and medical products) that present a risk for the health and safety of consumers. More than half of the notifications in 2005 concerned electrical appliances and toys, mainly imported into the EU from third countries. The increase in notifications can be attributed partly to improved reporting by some Member States.
Philip Bentley QC
The European Commission has published its 21st annual report on barriers to trade and investment in the US. According to the report non-tariff barriers are now the major obstacle to increased EU-US trade, notably in the area of government procurement. A wide variety of discriminatory “Buy America” provisions are highlighted as well as those impacting on federally funded infrastructure programmes. Investment issues remain important. Notwithstanding the huge investment flows across the Atlantic, US restrictions continue, especially in the shipping, energy and telecoms areas. These problems are often compounded by the complexity of laws at individual US State level.
NEXT WEEK’S EVENTS
Monday 13 March – Friday 17 March 2006
Competitiveness Council (13 March 2006)
Economic and Financial Affairs Council (14 March 2006)
Transport, Telecommunications and Energy Council (14 March 2006)
COURT OF JUSTICE
Environment and consumers
C-332/04 Commission v Spain
C-518/04 Commission v Greece
Freedom of establishment
C-3/04 Poseidon Chartering
Law governing the institutions
C-177/04 Commission v France
Joined Cases C-131/04, C-257/04 Robinson-Steele
C-310/04 Spain v Council
C-103/05 Reisch Montage
Freedom to provide services
Joined Cases C-392/04, C-422/04 i-21 Germany
C-452/04 Fidium Finanz
C-214/05 P Rossi v Office for Harmonization in the Internal Market
C-13/05 Chacón Navas
Joined Cases C-439/04, C-440/04 Kittel
C-98/05 De Danske Bilimportører
COURT OF FIRST INSTANCE
T-226/04 Italy v Commission
T-15/02 BASF v Commission
T-26/02 Daiichi Pharmaceutical v Commission
T-31/04 Eurodrive v OHMI - Gomez Frías (euroMASTER)
T-129/04 Develey v OHMI (Forme d'une bouteille en plastique)
T-35/04 Athinaiki Oikogeniaki Artopoiia v OHMI - Ferrero (FERRÓ)
T-322/03 Telefon & Buch v OHMI - Herold Business Data (Weisse Seiten)