Insights Brussels March 2014

INSIGHTS BRUSSELS March 2014

INSIGHTS BRUSSELS..March 2014.


SECTORAL POLICIES................................................................................................. 4

Agriculture And Fisheries ................................................................................................................. 4

The European Parliament rejects Commission’s proposal on seed regulation .............................................................. 4 The European Parliament proposes new rules on organic farming ............................................................................... 4

Defence and Security Policy ............................................................................................................... 5

The European Commission unveils a Roadmap on maritime security .......................................................................... 5

Energy and Environment ................................................................................................................... 6

EU Member States divided over 2030 climate and energy framework .......................................................................... 6 Commission imposed fines on leading European spot power exchanges ..................................................................... 6 Eurostat says EU consumption down by 8% since 2006 ............................................................................................... 7

Financial Services .............................................................................................................................. 7

The European Parliament approves insurance mediation directive ............................................................................... 7 The European Commission about to adopt Long term financing package .................................................................... 8

Food and Beverage ............................................................................................................................. 8

The European Parliament rejects the Commission’s definition of nano-materials ..................................................................... 8 Parliament’s Environment Committee approved animal cloning regulation ................................................................... 9

Healthcare and Pharmaceuticals ...................................................................................................... 9

European Parliament approves new EU programme for Health .................................................................................... 9

Information and Communication Technology ................................................................................ 10

The European Parliament and the Council of Ministers reach an agreement on broadband deployment ................... 10 The European Parliament approves regulation on personal data ................................................................................ 11

Transport .......................................................................................................................................... 12

Fourth Railway Package: the European Parliament votes in a tense climate .............................................................. 12 Road safety: the European Parliament makes eCall compulsory from 2015 ............................................................. 13 Public consultation on maritime consortia exemptions to antitrust rules ...................................................................... 13


CROSS-SECTORAL POLICIES .................................................................................. 14

Competition ...................................................................................................................................... 14

The European Commission modernizes the State-aid rule book ................................................................................. 14

Consumers ........................................................................................................................................ 15

The European Commission launches Consumer Awareness Campaign .................................................................... 15 National authorities adopted Common position to protect app-buyers ........................................................................ 15

Intellectual Property Rights ............................................................................................................ 16

The Council anticipates the implementation of the unified European Patent ............................................................... 16

International Trade.......................................................................................................................... 17

Progress in negotiations on the Transatlantic Trade and Investment Partnership ...................................................................... 17

Research and Development .............................................................................................................. 18

Commission adopts its 2014-2020 Final Simplification Scoreboard ............................................................................ 18

Taxation ........................................................................................................................................... 19

European Finance Ministers revitalize the debate on FTT .......................................................................................... 19


SECTORAL POLICIES

The European Parliament rejects Commission’s proposal on seed regulation

On 11 March, the European Parliament in

plenary session rejected a Commission’s

proposal for a regulation of plant reproductive

materials (PRM) which aimed at consolidating

and updating legislation on the production and

making available on the market of PRM with a

view to ensuring quality and information for

users. Members of the European Parliament

rejected it claiming the proposal was failing to

simplify the rules and was not supporting enough

innovation. They also feared that the regulation

would give the Commission too much power and

leave EU countries without any leeway to tailor

the new rules to their needs. The Commission

decided not to withdraw its proposal and is

waiting for the vote in the Council of Ministers. If

the Council supports the Parliament’s rejection,

the legislation process will end.

As a consequence of this vote, the Parliament’s

Committee on the Environment (ENVI) decided

later during the month to exclude seeds from the

scope of another new regulation on official

controls in the food chain in order to be coherent

with the above-mentioned rejection of the

regulation on plant reproductive materials. The

text is now expected to be voted during the last

plenary session of April.

April: Vote in the Parliament during the plenary session

16-17 June: Vote in the Council of Ministers

The European Parliament proposes new rules on organic farming

On 25 March, the European Commission is

expected to present a proposal for revised rules

on organic farming. This initiative aims to better

regulate the EU organic market that had gone

through significant changes during the last 10

years: the size of the market growth by four

times just while products increased in number

and complexity. This fact incentivized the

Commission to launch a public consultation on

the future of organic farming in 2013. The results

showed that a large majority of European

citizens demand for stricter and harmonized

rules throughout the EU.

In line with consumers’ concerns, the

Commission’s proposal is expected to focus on

three objectives:

Agriculture And Fisheries


Strengthening rules on production and

improving controls systems;

Harmonizing the production rules in order to

increase competition within and outside the

Union;

Removing legal and administrative obstacles

to developing organic farming in the EU.

25 March: Presentation of the proposal

Defence and Security Policy

The European Commission unveils a Roadmap on maritime security

On 6 March, the European Commission

presented a Roadmap to establish a common

strategy for maritime security. This initiative

follows the meeting of the 28 EU Defence

ministers that took place in Athens on 20

February. The aim of the strategy will be to

establish a common maritime surveillance both

in territorial and high waters in order to address

issues as piracy, ship attacks or illegal

immigration. The strategy will seek to increase

coherence between the already existing cross-

sectorial policies and to enhance cooperation

between EU institutions, Members States and

sectorial actors. In this regards, the European

Commission will set four main targets:

Rationalizing the use of European and

National capacities;

Creating an effective international

partnership;

Increasing solidarity between Member States

while guarantying sustainable costs;

Improving research and innovation activities

related to the maritime security and

supporting staff training.

Despite these general policy orientations, some

observers note that the proposal actually lacks of

concrete initiatives: no new structures,

programmes, or regulation will be set in place.

Based on this Roadmap, EU Heads of State and

Government will now elaborate an EU Maritime

Security Strategy with a view to adopt it in June

2014.

June 2014: Adoption of an EU Maritime Security

Strategy by the Council


Energy and Environment

EU Member States divided over 2030 climate and energy framework

Following the presentation by the European

Commission in January of a new 2030 climate

and energy framework, the 28 EU Environment

and Energy ministers met in Brussels on 3-4

March to exchange views on the proposed

framework consisting of a binding objective to

reduce greenhouse gas emissions by 40%

compared to 1990 figures and a binding

objective to reach at least 27% of energy

renewables in the EU energy mix in 2030.

While Western European countries support an

ambitious framework ahead of the international

climate Summit in Paris next year, Eastern

European ministers have been vocally opposing

a quick decision on the framework, arguing that

an international agreement should come first.

Eastern European Ministers also repeatedly said

that fair burden-sharing is essential in order for

them to agree on a high greenhouse gas

emission target for 2030. If no formal decision is

expected during the first half of 2014, the first

orientation debates at ministerial level are set to

feed into the discussion of the upcoming

European Summit of 20-21 March. According to

draft leaked conclusions of the Summit, EU

Heads of State and Government might push

their final decision to the end of the 2014,

potentially representing a win for Eastern

European countries.

In the European Parliament, MEPs continue to

put pressure on the Commission and on the

Council to adopt even more ambitious

measures. MEPs called for binding targets of a

40% cut in CO2 emissions, a 30% target for

renewable energy and a 40% target for energy

efficiency by 2030. MEPs are also worried that

the Commission may try to bypass Parliament by

choosing a different legislative basis in the EU

treaty when tabling its final proposal, in October

at the earliest.

20-21 March: EU Summit discuss climate and energy issues

22-25 May: EU Parliament elections

June 2014: Review of progress towards meeting the

2020 energy efficiency target

June 2014: EU Council discuss energy and climate issues

September 2014: UN Climate Change Summit

October: Commission presents final 2030 package

December 2015: Paris Climate Change Summit

Commission imposed fines on leading European spot power exchanges

On 5 March, the European Commission has

imposed fines on the two leading European spot

power exchanges (short-term trading taking

place within the same day), EPEX (€3,6 million)

and NPS (€2,3 million), for having agreed not to

compete with one another for their spot

electricity trading services in the European

Economic Area. The cartel covered a period of

seven months in 2011-2012 and NPS and EPEX

received a fine reduction of 10% each for


agreeing to settle the case with the Commission.

Any person or firm affected by this anti-

competitive behaviour may now bring the matter

before the courts of the Member States and seek

damages.

This case occurred in a context of a more global

European approach to make it easier for victims

of anti-competitive practices to obtain damages.

The European Commission presented in June

2013 a draft Directive to cover this aspect of

anticompetitive behaviours.

Eurostat says EU consumption down by 8% since 2006

Eurostat, the statistical office of the European

Commission, published on February 17 figures

on gross inland energy consumption in the

European Union. Over the last two decades,

gross inland energy consumption in the EU,

which stood at 1 670 million tonnes of oil

equivalent (Mtoe) in 1990, rose to a peak of 1

830 Mtoe in 2006 and then decreased to 1 680

Mtoe in 2012. Between 2006 and 2012, gross

inland energy consumption in the EU28 has then

fallen by 8%.

According to Eurostat, the energy dependence

rate stood at 53% in 2012. The domestic

production of primary energy was 794 Mtoe in

2012. Nuclear energy (29%), accounted for the

largest share, followed by renewables (22%),

solid fuels (21%), gas (17%) and oil (10%).

Financial Services

The European Parliament approves insurance mediation directive

On 26 February during a vote in plenary session,

the European Parliament adopted a position on

the review of the directive on insurance

mediation, a reform proposed in July 2012 by the

European Commission to increase the protection

of policyholders by regulating insurance services

selling practices. The Commission’s proposal

has faced opposition by Members of the

European Parliament on two main aspects:

The “tying” practice (the practice consisting in

selling many insurance products in a

package) was banned in the Commission’s

proposal for consumers’ protection reasons.

Many MEP’s (including the rapporteur)

rejected this ban and supported instead new

rules limiting this practice without banning it

completely. According to the provisions

adopted, consumers should have now the

right to decide if they want to buy the different

components separately or as part of a

package and they should be fully informed

about the prices and the risk profiles of the

services.

The range of products covered by the reform

has also been increased: new requirements

on transparency, conflict of interest and


information provision have been included in

the draft Directive.

Representatives of credit providers’ welcomed

the vote while consumer’s organizations judged

it insufficient even if they concede some

improvement in the protection of consumers.

The European Parliament has now to find an

agreement with the Council.

April: start of negotiation with the Council

Mid 2014: possible final adoption of the directive

The European Commission about to adopt Long term financing package

On 27 March, the European Commission is

expected to adopt a follow-up communication to

the green paper on the Long-term financing of

the European Economy.

The green paper was drafted in order to address

a major problem for the European Economy: the

lack of long-term financing. The crisis has

weakened banks capacity to lend and new

institutional actors have to be involved in order to

finance future investments.

The Commission’s proposal sets actions around

six main areas:

Private finance: Involving private actors in

the long-term financing process;

Public finance: Rationalizing the use of

public finance for long-term financing;

Capital Market: Improving the effectiveness

of the market to boost long-term financing;

SME’s: Improving SME’s access to finance;

Infrastructure: Mobilizing private source in

infrastructural projects;

Cross-cutting factors: Adapting the legal and

tax framework for long-term financing.

On the same day the Commission will also adopt

a legislative proposal to revise the existing pan-

European legal framework on occupational

pension provisions (IORP).

27 March: presentation of the proposal

Food and Beverage

The European Parliament rejects the Commission’s definition of nano-materials

On 26 February, the European Parliament’s

Committee on the Environment (ENVI) rejected

the European Commission’s proposal for a

redefinition of “engineered nanomaterials”. The

Commission was putting forward a new definition

to adopt the finishing touch to the Food

Information Regulation (FIR) adopted in 2011,

and according to which, ingredients classified as

engineered nanomaterials should be clearly


indicated in the list of ingredients of any

commercialized product.

MEPs considered that the 50% threshold

required of nano-particles contained in an

ingredient to classify it as “nano” is considered

too low.

The European Consumers’ Organisation

expressed satisfaction toward MEP’s vote,

stating that Commission’s proposal would have

limited consumer’s right to be informed about

ingredients they consume.

N.A.: New Commission’s proposal

Parliament’s Environment Committee approved animal cloning regulation

On 20 February, the Committee on the

Environment (ENVI) approved the draft

regulation proposed by the European

Commission to ban animal cloning for food

production. Despite the positive vote, Members

of the Committee addressed formal and

substantial critics to the Commission.

From a formal point of view, MEP’s criticized

the choice of the Commission to choose a

consent procedure for the most important part

of the package. MEP’s stated that this very

sensitive file should have been dealt with the

ordinary procedure. The Parliament does not

have binding powers and will only be able to

approve or reject a compromise proposal

coming from the Council.

From a substantial point of view, MEP’s

blamed the Commission for not including in its

proposal rules to ban products obtained from

descendants of cloned animals (especially

coming from third countries where this

practice is legal). Members were also

expecting rules to guarantee the traceability

and the labelling of food from descendants of

cloned animals.

The final resolution is probably going to be voted

during the plenary session of April. This vote will

act as a warning signal addressed to the Council

ahead of the kick-off of its negotiations with the

Commission.

April: vote in the Parliament during the plenary session

April: start of the negotiations between the Council and

the Commission

Healthcare and Pharmaceuticals

European Parliament approves new EU programme for Health

On 26 February, the European Parliament in

plenary session approved with a large majority

the European Union Third Health Programme.

The vote confirmed the agreement negotiated

with the Council. The programme aims to

achieve four objectives:


Promote health, prevent diseases, and foster

supportive environments for healthy lifestyles;

Protect citizens from serious cross-border

health threats;

Support public health capacity to build and to

contribute to innovative, efficient and

sustainable health systems;

Facilitate access to better and safer

healthcare for Union citizens.

The budget made available for the new Health

Programme will be €449.4 million. This means

an increase of more than €100 million compared

to the last 2007-2013 programme. In most

cases, the European Union will provide grants

that will contribute for 60% of the costs of

supported project. This figure rises to 80% in

case of specific joint actions.

Access to funds will be facilitated by the creation

of a single point of contact. Potential candidates

for funding are national health authorities, as

well as public and private bodies, international

and non-governmental organizations.

On 11 March, the regulation has been adopted

by the Council. The publication of the annual

work programme 2014 is expected by May.

April/May: Publication of the 2014 work programme

The European Parliament and the Council of Ministers reach an agreement on broadband deployment

On 28 February, representatives from the

Council and the European Parliament reached a

compromise on a directive on the cost of

deploying high-speed electronic communications

networks. The aim of the directive is to improve

the coordination of civil engineering works in

order to reduce costs of deployment of high-

speed networks.

According to the European Commission, civil

engineering costs, like the repetition of

pavements digging, accounts for 80% of the cost

of deploying broadband. The new regulation will

in that respect introduce the obligation for

network operators to grant access to their

physical infrastructures for broadband

installation. The rule would be mandatory for

companies working in the following sectors:

telecommunications, energy, sanitation and

transport. Companies working in the drinking

water sector would be excluded because there

are too many sanitary issues related to this

particular sector. This rule already exists in some

Member States (France, Portugal and Belgium).

Furthermore telecoms operators will be able to

receive basic information about existing or under

construction infrastructure, through a single

information point that may be just an internet

portal. Regarding disputes, MEP’s obtained that

Information and Communication Technology


decisions made by the regulatory authority in

case of conflict will be binding.

Member States will not be forced to improve

infrastructures or to map their network. The only

controversial point is that, from 2017, new

buildings or those under “major renovations”

must be high-speed-ready.

The text has now to be formally approved by the

Council of Ministers and by the European

Parliament during its plenary session in April.

The new measures are expected to enter into

force in 2016.

April: Parliament’s formal adoption

April-May: Council formal adoption

2016: entry into force

The European Parliament approves regulation on personal data

On 12 February, the European Parliament in

plenary session approved by an overwhelming

majority a report by Jan-Philipp Albrecht

(Greens, Germany) on personal data protection.

The text introduces stricter rules for data

gathering and processing. Tougher sanctions in

case of violation of the European rules (5% of

the global turnover while the Commission

proposed 2%) are also introduced. Another

milestone of Albrecht’s report is the introduction

of the “right to be forgotten” which means that

users should have the right to have their own

data removed. The consent of the use of data

should also be clarified and become more

explicit especially when the data are transferred

to third countries.

Despite the large majority within the Parliament

to support the report, the text has been criticized

by associations such as Digital Europe which

fears that European companies would lose

competitiveness. Journalists and publishers

association also criticized the regulation

denouncing a limitation to freedom of press and

of expression. The press association claims for

an exemption “for journalistic and artistic

purposes” from the provisions on the “right to be

forgotten”. This exemption was originally

included in the Commission proposal.

The Parliament has now to find an agreement

with the Council and negotiations are likely to be

very intense especially because the text is

extremely dense and technical. The text will

probably be discussed in June during an

informal meeting among EU justice ministers. A

definitive agreement is unlikely to be reached

before the end of 2014.

June: informal meeting between Justice Ministers Early 2015: expected agreement in the Trilogue


Transport

Fourth Railway Package: the European Parliament votes in a tense climate

On 26 February in plenary session, the

European Parliament voted on the EU's fourth

railway package, aimed at fully opening up rail to

competition from 2019 by liberalising national

passenger transport, the last segment still

protected today.

In reality, though, many provisions will continue

to make it complicated for new players to enter

the market. In December 2019, barriers will be

removed and rail undertakings will have the

opportunity to directly offer passenger transport

services that compete with those of the

incumbent railway companies. However, given

the fact that most national lines are covered by

public service contracts (representing 90% of

national traffic), new players will have to wait

until 2022 for new provisions to apply on

tendering procedure to award public contracts.

And even after that date, Member States will still

be allowed to award direct contract: the

obligation to launch tendering procedure will be

compulsory only if the incumbent railway

company does not fulfil a certain number of

criteria such as punctuality, frequency of

services, customer satisfaction or quality of

rolling stock.

The Parliament also confirmed its rejection of the

separation between infrastructure manager and

incumbent rail operator, much to the

Commission’s disappointment. With this vote,

the European Commission considers that many

MEPs have continued to protect traditional

railway companies from competition and

technical problems. MEPs were also subject to

intense lobbying actions from Member States

and incumbent railway companies. Some 2,600

rail workers from 17 countries also

demonstrated, on 25 February in Strasbourg,

ahead of the European Parliament's vote.

Along with the measures on market

liberalization, the Parliament also approved the

technical simplification of the European rail,

since there are currently over 11,000 different

national technical and safety rules in each of the

28 member states, hampering competition and

“leading to excessive administrative costs”.

March-April: Council of Ministers examine the package

13 June: Transport Ministers Council

September: possible start for Trilogue negotiations

December 2019: passenger transport liberalization

December 2022: new rules for tendering procedure


Road safety: the European Parliament makes eCall compulsory from 2015

On 26 February, the European Parliament

adopted a regulation to make compulsory from

October 2015 onwards the installation in all new

models of cars and light utility vehicles of an

automatic dialling system for reporting road

accidents, a device also known as eCall. The

system automatically alerts emergency services

to the exact location of an accident, using the

emergency number 112. According to the

European Commission's estimates, it could save

almost 2,500 lives a year by allowing emergency

services to reach accident scenes more rapidly.

Some Members of the European Parliament also

raised some concerns about the protection of

privacy. MEPs consequently adopted some

restrictions on information supplied in the event

of an accident.

According to the automobile industry, the

deadline is very ambitious, as Member States

will need to deploy public service answering

points (PSAPs) to receive the call.

Before May: possible final adoption of the regulation 13 June: Transport Ministers Council

October 2015: obligation to install eCall devices in all

new models of cars

Public consultation on maritime consortia exemptions to antitrust rules

On 27 February, the European Commission

opened a public consultation to gather

comments on a proposal to prolong for another

five years an exemption of liner shipping

consortia from the application of EU antitrust

rules that prohibit certain agreements between

companies. The maritime consortia block

exemption regulation allows shipping lines to

enter into cooperation for the purpose of

providing a joint service. In light of the

comments received, the Commission will then

adopt a new Regulation before the expiry of the

current Regulation in April 2015. The

consultation will be open until 31 March 2014.

31 March: deadline for the public consultation

Fall 2014: Commission’s draft proposal presented

April 2015: expiry date for current exemption

April 2020: expiry date future exemption (if adopted)


CROSS-SECTORAL POLICIES

Competition

The European Commission modernizes the State-aid rule book

The European Commission is currently putting

the finishing touch to its new framework for state

aid rules to be presented in April. Since May

2012, the European Commissioner for

Competition, Joaquin Almunia has launched a

process of modernization of state aid rules with a

view to focus on how the rules should apply to

sectors that have traditionally been public but

where private companies are increasingly active.

Following preliminary works, the European

Commissioner is now ready to defend key

elements of new guidelines in the following

areas:

Energy and environmental state aid

guidelines: the public consultation on draft

guidelines ended on 14 February. With an

increasing penetration and decreasing costs

of renewable energy, the Commission wants

state aid rules to gradually move to a more

market friendly support of renewable energy

in the form of market premiums or certificate

schemes. Nine governments, (including

Austria, Denmark, France, Germany,

Luxemburg, the Netherlands, Poland,

Sweden and United Kingdom) published in

February a position paper to argue that the

new rules on the funding mechanism for

renewable energy and the opening-up of the

national funding systems for other countries

are too restrictive ;

Research, development and innovation

activities: the public consultation on draft

guidelines ended on 17 February. The

Commission seeks to offer Member States

more possibilities to channel state aid towards

boosting innovation and jobs, by clarifying

conditions for subsidized pilot and

demonstration projects, by facilitating the

validation of technologies vital for the

competitiveness and by creating a new

category of aid for construction and upgrade

of research infrastructure;

Agriculture and forestry sectors: the

Commission opened on 24 February a public

consultation on draft new rules on State aids

in the agriculture and forestry sectors and in

rural areas. The new rules proposed should

speed up procedures and significantly reduce

the administrative burden for public

authorities when dealing with State aids in the

agriculture sector. These drafts are made

public to inform institutions, public authorities,

organisations, companies and citizens who

can make comments by 24 March 2014.

Aviation: the European Commission launched

a public consultation in July 2013 and

definitely adopted the guidelines on 20

February 2014. It frames State aid for

investment in airport infrastructure, Operating

aid to regional airports and Start-up aid to

airlines to launch a new air route.

In 2012 and 2013, the European Commission

already adopted guidelines in the broadband

sector, in risk finance management, in regional


aid and in the promotion of important projects of

common European interest. The Commission

has also invited opinions on whether settlements

between tax authorities and individual

companies can constitute state aid. The

upcoming new framework will clarify key concept

related to the notion of state aid with a view to

contributing to a consistent application of these

notion across Europe.

24 March: deadline for public consultation on agriculture

and forestry

April: presentation of the new framework

Consumers

The European Commission launches Consumer Awareness Campaign

On 14 March in Thessaloniki, took place the

European Consumer Day. On the occasion the

European Commissioner for Consumer Policies,

Neven Mimica, announced the kick-off of the

Consumer Awareness Campaign. The new

consumer right directive will enter into force on

13 June giving to citizens key consumers rights:

Right to return products within 2 weeks;

Right to have defective products repaired or

replaced;

Right to be fully informed about products;

Right to be informed about the right address

to contact in case of complaint.

According to the Commission, the next step to

take is to inform consumers of their rights and

how to use them in practice. This step seems

fundamental to fulfil the scope of the legislation.

To address this issue the Commission is going

to launch next spring, the Consumer Awareness

Campaign. The initiative will focalize on

countries where awareness of consumer right is

low according to the latest consumer

scoreboard. Commissioner for Consumer

policies will visit Bulgaria, Cyprus, Greece, Italy,

Latvia, Poland, Portugal and Spain. A series of

formative events will be organized around his

visits.

Spring: Start of the Consumer Awareness Campaign

National authorities adopted Common position to protect app-buyers

On 27-28 February, the national authorities

within the Consumer Protection Cooperation

Network (established by a EU regulation) took a

common position on practice related to

applications purchase. According to data

processed by the European Commission, 80% of

the income of app-sellers comes from in-app

buys (buying services during the use of an

application to access full content). The aim of the

position is to avoid practice that may mislead


consumers. National authorities focused on 4

main issues:

Avoid consumer misleading by advertising

game as “free” when they are not;

Prevent children to purchase apps updated

versions;

Avoid charging consumers without an

explicit;

Provide information to consumers and

especially trader´s email address,

National authorities and the European

Commission will keep monitoring the industry

until a formal commitment and a detailed

agenda is set up with app-providers

Intellectual Property Rights

The Council anticipates the implementation of the unified European Patent

On 4 March, the EU 28 Justice and Home Affairs

Ministers adopted a proposal to modify the so

called “Brussels I” regulation which recognizes

national court judgments in civil and commercial

matters. This regulation was amended in order

to adapt the legal framework to the future unified

patent system which is expected to be

operational in 2016.

Despite this adoption, the unified European

patent will certainly be delayed. Currently only

two Member States (Austria and Malta) have

ratified the international agreement that establish

the court in charge of hearing disputes. Spain

and Poland decided to stay out of the deal while

Croatia was not part of the Union when the

agreement was signed one year ago. The other

Member States have to ratify the text through

their legislative chambers or by referendum

(such as in Denmark). The European Court will

have a central division in Paris, and two

branches: one in London specialized on

pharmaceutical patents and a second in Munich

focalized on engineering patents. The future

rules of procedure of the new body will be

published in summer 2014 by a preparation

committee. The unitary patent will entry into

force after the ratification of the agreement by at

least 13 countries including France, Germany

and the United Kingdom.

Summer 2014: Publication of the rules of procedure of

the European Patent Court 2016: expected unified European patent


International Trade

Progress in negotiations on the Transatlantic Trade and Investment Partnership From 10 to 14 March, representatives from the

European Union and the United States met in

Brussels to try to move a step forward in the

Transatlantic Trade and Investment Partnership

(TTIP) negotiations. Both sides reported “regular

progresses” without providing too many details.

According to observers, negotiators are now

trying to build consensus around the discussions

involving a large number of stakeholders in the

talks. In this context, the two sides published a

joint document analysing the potential benefits of

the agreement for Small and Medium

Enterprises (SMEs). The document highlights

how small businesses are negatively impacted

by non-tariff barriers during their

internationalization processes. Negotiators also

met around 300 representatives of business,

consumers and other relevant stakeholders.

The most controversial aspects that were

discussed are:

Market access: the offer made by the US on

tariffs removal is still considered insufficient

by the European side. According to EU

officials the EU aims to remove tariffs in 96%

of areas while the US wish to stop at 88%. On

that point the compromise could be to

elaborate a roadmap to remove tariffs on

different kind of goods gradually (immediate

removal, 3 years, 7 years and undefined).

Public procurement: The Commission would

like European Companies not to be

discriminated while competing to bid

procurement contracts in the US, especially at

the state level. Currently, the so-called Buy

American Act, encourages companies to

prefer US-made products in their purchases

Exclusive rights for well-known products like

feta cheese or Porto wine. Cheese made in

the US can be labelled and sold as

“Parmesan” while in the EU it cannot. The EU

asks the recognition of a Geographical

Indication protection while the US consider

that the European system is too broad and

unfair towards American producers. Europe

has already reached a similar compromise

with Canada claiming that this recognition

avoids consumers misleading.

Investor-State Dispute-Settlement (ISDS):

The US aims to strengthen companies’

position on legal disputes with States; on this

point the EU will launch in the next weeks a

three months public consultation. The

Commission is willing hold its decision until

the end of the public consultation results.

Germany already expressed concerns on this

point.

Data protection: The European Parliament is

demanding to include regulations addressing

how private data is collected by businesses in

the agreement.


Financial services: The US are still resisting

the European pressure on including financial

services in the deal.

A fundamental next step will be the visit of the

US President Barack Obama in Brussels on 26

of March when the Commission hopes he will

provide “political guidance”. Negotiators are

expected to meet again before the summer in

Washington.

26 March: US president Obama visits EU in Brussels

End of June: deadline of the public consultation

Summer: Fifth round of negotiations in Washington

Research and Development

Commission adopts its 2014-2020 Final Simplification Scoreboard

On 4 March, the European Commission adopted

a Final Simplification Scoreboard for the

Multiannual Financial Framework 2014-2020.

The text introduces 120 measures to simplify the

European Union funding rules. The aim of the

initiative is to facilitate the access to EU funding

for European businesses, towns, regions,

scientists and NGO´s but without reducing the

monitoring on how the money is spent. The

measures adopted include: a simplified

procedure to get reimbursement in research,

shorter deadline for payments to beneficiaries

(90 days) in cohesion policy and the introduction

of an electronic system (e-cohesion) for

beneficiaries to submit data in cohesion policy.

Nevertheless more is still to be achieved

especially at a national level. Around 80% of the

EU budget is implemented by Member States so

efforts to reduce administrative burdens on

beneficiaries should be continued at local and

regional level.

On the same day the European Commission

published a report (Innovation Union Scoreboard

2014) that evaluates the innovation performance

of the EU countries. Unexpectedly the figures

show that the effects of the crisis were not “as

severe as expected”. Generally the rate of

average EU innovation performance has

increased with Sweden, Denmark and Germany

still leading the ranking. The indicators

concerning convergence between Member

States performance also showed positive

results.


Taxation

European Finance Ministers revitalize the debate on FTT

On 19 February, Finance Ministers from 11

Eurozone Members had an informal meeting

outside the Ecofin Council to discuss the

introduction of the proposed Financial Transaction

Tax (FTT). Under the enhanced cooperation

procedure 11 countries are trying to reach a

political agreement or at least a joint declaration on

the FTT before the European elections of May

(Germany, France, Italy, Spain, Belgium, Austria,

Portugal, Greece, Slovakia, Slovenia and Estonia).

The discussion at a political level shows for the

very first time that despite the critics that followed

the stalemate of the proposition 11 Members are

still determined to introduce the rule. The key

questions that have been debated among

ministers mainly focus on:

The scope: Members are discussing about

applying the tax only to shares and to extend it

later to bonds and derivatives;

The principle of place of residence of the parties

to the transaction and/or the place of emission

of the taxable financial instruments.

Germany and France are discord on these

fundamental points. Both countries want to avoid

the risk that the new rules could lead to a flight of

capital outside the “FTT zone”. According to

observers this contrast may lead to a minimalist

compromise.

The only certain element is that the revenue

coming from this tax would be much lower that the

amount planned by the Commission (35 Billion

Euros).

May: next Ecofin Council


mailto:[email protected]



Insights Brussels March 2014

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