Select Committee on European Scrutiny Thirty-Eighth Report



Letter from the Secretary of State at the Department for Environment, Food

and Rural Affairs (Margaret Beckett) to the Chairman of the Committee



My Hon Friend the Parliamentary Under Secretary (Commons) and I represented the United Kingdom at the meeting of the Agriculture and Fisheries Council in Brussels on 23-24 September. The Scottish Minister for Environment and Rural Development also attended. This was the first meeting since the Agriculture and Fisheries Councils were combined.

The Council began its detailed consideration of the Mid-Term Review of the CAP published in July with a discussion of the proposals for the arable sector. I stressed the importance of securing further, meaningful reform of the CAP and recalled the importance that developing countries attached to improved trading conditions for agriculture, as they had stressed at the recent World Summit on Sustainable Development in Johannesburg. Officials will continue with detailed examination of the MTR package.

There was a public debate on the transport of live animals. I recommended better monitoring of animal welfare in transit and supported the case for reducing maximum journey times to eight hours. I noted that in remoter regions of the EU, specific concessions might be required but should be carefully controlled. There was, however, no agreement on an eight hour limit and further consideration will take place.

The Commission reported the latest information on BSE and scrapie in the EU, noting that there had been no significant development since its last report to the Council.

The Presidency reported the state of progress on the proposal for rules governing genetically modified food and feed and signalled its intention to seek political agreement on a compromise at the October Council. It also reported progress in the drawing up of an action plan for organic food and farming.

On fisheries, Commissioner Fischler presented to the Council a communication from the Commission on a Strategy for the Sustainable Development of European Aquaculture. The Council will discuss this substantively at a later date.

Substantive discussion on fisheries focused on the reform of the Common Fisheries Policy (CFP), and specifically on a paper presented by the Presidency identifying the multi-annual management of fisheries, fleet policy and enforcement of CFP rules as subjects for discussion. The UK supported a multi-annual approach to stock management under which a range of potential management measures would be specified, the widest range of which would need to be applied only to the stocks in the worst condition. On fleet policy the UK stressed that, in view of the gravity of the scientific advice all options should be considered by the Council, including capacity and effort reduction; we continued to support the ending of grants for vessel modernisation and construction and for the export of excess EU fishing vessels to non-EU countries. And we supported better, more even enforcement subject to provisions being adopted which are legally compatible with national jurisdiction and competence.

There continues to be a wide divergence between the views of a group of member states who, like ourselves, broadly support the Commission's proposed approach, and a group who oppose significant elements of it. Discussions will continue at future Councils.

Under AoB, the Commission reported on the Johannesburg Summit; producing countries sought an update on EC/US wines negotiations; France and others reported severe weather conditions that had damaged agricultural production; and Sweden raised the question of imports of organic produce.

Letter from the Parliamentary Under-Secretary of State for Competition,

Consumers and Markets at the Department of Trade and Industry

  (Melanie Johnson) to the Clerk of the Committee



I am writing to inform you that I represented the UK at the Competitiveness Council of Ministers ("CC") in Brussels on 30th September. This was the first meeting of the new CC formation, which is an amalgamation of the Internal Market, Industry and Research formations.

The five specific programmes of the sixth R&D Framework programme were adopted and there was political agreement on legislative dossiers covering public procurement (the utilities directive) and fertilisers (fertilisers regulation). In addition, there was political agreement on two company law dossiers: the updating of the First Company Law Directive on filing and disclosure of company documents in the light of new technology; and the modernisation of the EU Accounting Directives to take account of the adoption of International Accounting Standards as the reporting regime for the EU's listed companies.

Council Conclusions were adopted endorsing the Commission's Action Plan on Better Regulation and its rapid implementation.

There was a Presidency report on the proposed discussions at the Nyborg informal, of the methods of working of the new CC formation and a progress report on the proposed 25th amendment (including some overlap with the 23rd amendment) to the marketing and use of dangerous substances directive to include controls on further carcinogens, mutagens and substances toxic to reproduction.

There were Commission presentations on the streamlining of the annual economic and employment policy co-ordination cycles and two reports: the State of the Internal Market for Services and Second Biennial Report on Mutual recognition in the Internal Market.

The Commission also reported that bilateral talks with Korea had failed to reach agreement,

and the Commission confirmed that it would now implement the decision as agreed by the Council in June — namely to launch the WTO case against Korea together with the

reintroduction of the limited and temporary shipbuilding subsidies.

Over lunch Professor Jaap Winter reported on the consideration by the High Level Group on Company Law of corporate governance issues in the light of large-scale corporate collapses in the US. The Group's approach was to explore ways in which to improve standards of corporate governance, where necessary, and strengthen the role of shareholders within a flexible EU framework. When the formal session resumed conclusions supporting the development of an EU Action Plan were adopted without debate.

The UK voted in favour of political agreement on the public procurement directive and fertilisers regulation as well as the updating of the First Company Law Directive and the modernisation of the EU Accounting Directives. The UK was also in favour regarding the adoption of the five specific programmes of the sixth R&D Framework programme and the Council conclusions, on the Commission's Action Plan on Better Regulation and on the development of an EU Action Plan on corporate governance.

Letter from the Minister for Europe at the Foreign and Commonwealth Office

  (Rt Hon. Peter Hain) to the Chairman of the Committee




I am writing to you of the outcome of the General Affairs and External Relations Council in Brussels on 30 September, at which I represented the UK.

The Council approved the "A" points listed in document 12354/1/02 PTS A 44 and noted the resolutions, decisions and opinions of the European Parliament listed in document 11109/02.

Progress of work in other Council Configurations

The Council took stock of work in other Council configurations. The Presidency drew attention to discussions in the Agriculture and Fisheries Council (23/24 September) on the Mid-Term Review of the CAP and reform of the Common Fisheries Policy.

Preparation of the European Council in Brussels

The Council endorsed the draft annotated agenda for the next European Council meeting in Brussels (24/25 October), drawn up by the Presidency in the light of the Seville conclusions on improving the efficiency of the European Council.

The European Council is expected to focus in particular on enlargement. The European Council will address the outstanding issues with a view to presenting a common position to the candidate countries in early November. The European Council will have to decide which candidate countries fulfil the Copenhagen criteria and can therefore conclude accession negotiations at the European Council in December. It will also aim to resolve financial and budgetary issues (agriculture, structural funds, cohesion funds, internal policies and budgetary compensation); and institutional issues (QMV threshold, number of MEPs, order of post-enlargement Presidencies and transitional arrangements).

Future of Europe Convention

Convention Vice President, Giuliano Amato, presented a progress report on the Convention's work. This was followed by a short debate.





The Council examined a draft regulation establishing an EU Solidarity Fund, in the light of recent European floods. The regulation would enable the Community to offer financial assistance to Member States and candidate countries beset by major disasters.

Commission's Communication on Trade and Development

The Council held an open debate on the Commission's Communication on trade and development. The Council discussed the importance, in the light of recent major conferences on international development (Doha, Monterrey and Johannesburg), of the EU promoting greater coherence and effectiveness in its trade and development policies. I underlined the need to pursue reforms to enable developing countries to benefit from free trade with the EU, particularly in agriculture. The debate emphasised the importance of improved technical assistance, greater market access and reform of the CAP.

EU-Switzerland relations

The Council reviewed progress in negotiations with Switzerland, noting that negotiations were taking place on a range of issues, including taxation. Council Conclusions underlined the importance of achieving a successful outcome to the EU-Switzerland negotiations on taxation by the end of this year, noting that, without it, it would be difficult to conclude negotiations with Switzerland in other areas.

Russia: Kaliningrad

The Council welcomed the Commission's Communication on Kaliningrad, underlining the special effort the EU was prepared to make to accommodate Russian concerns, support efforts to promote the economic development of Kaliningrad, and to strengthen cross-border co-operation. The Council agreed that the Commission's Communication should provide the basis for discussions with Russia, in line with the conclusions of the Seville European Council. In particular, the following elements should be raised: possible use of a facilitated transit document (FTD) enabling transit for a time-limited period; financial assistance to Lithuania for implementing the 'Kaliningrad package'; the possibility of negotiating an early readmission agreement with Russia; and ensuring that customs procedures are sufficiently flexible.

New neighbours initiative

Following joint presentation by the High Representative, Javier Solana and Commissioner Patten, the Council reaffirmed its commitment to enhancing relations between the future enlarged EU and its Eastern neighbours, Ukraine, Moldova and Belarus. The main objectives include creating stability and narrowing the prosperity gap at the new borders of the Union. The Council will adopt more detailed Conclusions on this issue at a future session.

International Criminal Court

The Council reaffirmed its commitment to the early establishment of the International Criminal Court and its intention to secure the widest possible international support for the ICC. The Council adopted Conclusions on the ICC, including guidelines for Member States when considering the necessity and scope of possible bilateral agreements with the USA.



Western Balkans

The Council adopted Conclusions on a range of Western Balkans issues. This included a message to the people of Bosnia and Herzegovina in the run-up to the 5 October general election.

On the FRY, the Council recalled that a rapid adoption of the Constitutional Charter and Action Plan on internal market and trade and customs was essential for further progress towards the EU.

On the Former Yugoslavia republic of Macedonia, the Council welcomed the orderly conduct of the recent elections and looked forward to the rapid formation of a new government committed to the implementation of the Ohrid Framework Agreement and to the Stabilisation and Association process. The Council agreed to appoint Ambassador Alexis Brouhns the new EU Special Representative.

On Croatia, the Council reaffirmed its strong support for the international Criminal Tribunal for the Former Yugoslavia (ICTY) and called upon the Croatian authorities to co-operate fully with ICTY in the case of General Janko Bobetko.


The Council adopted Conclusions which expressed grave concern about the current situation in the Middle East, condemning the latest wave of violence and terrorism and those responsible. The Council welcomed the adoption of UNSCR 1435 and urged both parties to comply fully with this resolution and to return to the negotiating table. The Council welcomed the outcome of the Middle East Quartet meeting on 17 September and the elements for a 'road map' towards a comprehensive settlement. It urged the Palestinians to push ahead with the reform efforts and in particular to co-operate on reform of the Palestinian security services with Israel, the US, the EU and regional partners. The Council encouraged the Palestinians to hold free and fair elections in 2003 and expressed a willingness to offer appropriate assistance. The Council stressed the urgent need to alleviate the humanitarian situation and called on Israel to allow full access for international and humanitarian personnel.

Letter from The Minister of State at the Department for Transport (John Spellar)

to the Chairman of the Committee


3 OCTOBER 2002


The transport segment of the Transport, Energy and Telecommunications Council was held in Luxembourg on 3 October. I represented the United Kingdom. This is a summary of the outcome. Progress was noted on the Single European Sky and on the second railway package, the Danish Presidency's main priorities. The Presidency had hoped to reach agreement on Marco Polo and on the proposed revision of the transport trans-European network guidelines, but this was not achieved.

The Presidency gave a progress report on the Single European Sky. It hoped that the key remaining issues — civil/military co-operation, the legal base and the relationship with Eurocontrol — could be resolved to allow agreement at the December Council. This was endorsed by the Commission. The Presidency concluded that work would continue towards a political agreement in December, in line with the Conclusions of the European Council in Barcelona. We have supported this initiative throughout and I very much hope that agreement will be achieved.

The Presidency also gave a progress report on the work being carried out to update rules for allocating take off and landing slots, including, as a first stage, a proposed amendment to Regulation 95/93. The Presidency and the Commission agreed that progress was being made and hoped for agreement at the December Council. In my intervention I noted the importance of ensuring that slot allocation should be market-based and that existing trading systems should not be ruled out.

The Council held a policy debate on the proposed amendment to Regulation 295/91, on denied boarding compensation for air passengers. Ministers were asked to reply to three questions. The first asked whether the Regulation should apply to passengers whose flight is part of a package tour. Most Ministers were able to accept this, although a number had reservations. I was among those who spoke against, pointing out that the situation of inclusive tour passengers could form part of the imminent review of the Package Tour Directive. However, the UK could accept application to package tourists on scheduled flights. The second question addressed the proposed levels of compensation. Again various views were expressed, and the Commission agreed to be flexible on the issue. The third question concerned the period of compulsory advance notice to passengers. There was general agreement that this should be seven days. The Presidency concluded that on the basis of the points made in the debate, work should continue on the proposal.

The Commission presented a proposal to establish minimum levels of insurance cover for air carriers entering Community airspace. The intention was to ensure appropriate cover for all, in line with existing international requirements, but with appropriate flexibility for alternative arrangements where cover could not be obtained.

Ministers considered the current situation in the aviation insurance market. The Commission felt that the market was now sufficiently re-established to negate the need for

continued state support. A number of Member States made it clear that they wished to continue these schemes for the immediate future. The Presidency noted that ECOFIN would examine the issue on 8 October. It concluded that the Commission would examine any possible national extensions, on a case-by-case basis, in line with the state aid provisions of the Treaty. It also noted that work would continue on the examination of the proposed ICAO mutual scheme ("Global time").

The Presidency gave a progress report on the second package of railway proposals, and confirmed that this was one of its highest priorities. It hoped for agreement in December on the package, which includes the next stage of rail liberalisation and related safety measures. There were still some issues to be resolved, principally on the proposed European Railway Agency and on the market access proposal. The Presidency asked for further work to be done.

The Presidency sought political agreement on the Regulation establishing the Marco Polo programme, which would provide Community aid to improve the environmental performance of freight transport (by promoting the movement of freight from road to other modes). The discussion, which was held in public, centred on the total budget. Following two rounds of formal voting Ministers were able to agree on a level of Euro 65m, but the Commission could not agree. The Presidency concluded that work would continue on the proposal.

In another public debate, the Presidency sought political agreement on its proposed compromise on the draft revision to Decision 1692/96 on guidelines for the development of the transport trans-European network. Ministers were unable to agree on changes to the list of priority projects at Annex III to the Decision and work will continue on the proposal.

In a report on Alpine transit issues, the Presidency noted the recent discussions between the countries most directly involved, Austria, Italy, Germany and Greece, and that work was underway in a series of working parties established amongst them. The Commission said it would not issue further proposals on ecopoints. It accepted that there were delays with its proposals on infrastructure charging (which would preclude the need to extend the ecopoint system), but these were now expected by the end of the year. The Presidency concluded that there was hope for progress.

The Commission outlined the main points in its Communication on the development of the Galileo satellite navigation project: the establishment of the Joint Undertaking; service definition and frequencies; and relations with third countries. It hoped that disagreement on funding in the European Space Agency, which is delaying the setting up of the Joint Undertaking, could be resolved at the ESA Ministerial on 8 October. In the discussion on service definition, I raised the problems which would be caused by the Public Regulated Service (PRS), as envisaged in the Communication. Agreement with the US on interoperability with GPS was necessary, and there were provisions in the Communication which would render this impossible. We remained unconvinced about the need for a PRS. Following this discussion, the Presidency concluded that COREPER would examine all outstanding questions. I will be submitting to the scrutiny committees an explanatory memorandum on the Communication, setting out in more detail our position on the PRS.

Under other business, Belgium presented a paper outlining the problem of accidents to vulnerable road users as a result of blind spots on heavy goods vehicles. The Commission hoped that, by the end of the year, a Directive would be adopted requiring the fitting to new vehicles of the mirrors necessary to overcome the problem. It was examining the issue of retrofitting.

Two proposals were adopted as "A" points, ie without debate. These were: the conclusion of the Interbus agreement between the EC and 14 Central and Eastern European countries, establishing rules for buses and coaches carrying out occasional international services; and approval of the signing of an agreement on maritime transport between the EC and China.

There were two formal votes at this Council, both during the debate on the Marco Polo budget. I voted for the Presidency compromise at the second vote.

Letter from the Secretary of State at the Department for Work and Pensions

  (Andrew Smith) to the Chairman of the Committee




I am writing to inform the Committee of the outcome of the ESPHCA Council held in

Luxembourg on 8 October 2002. I represented the UK accompanied by Alan Johnson,

Minister of State for Employment Relations and the Regions.

This was the first meeting of the new Council formation as reconfigured at Seville. Its relatively light agenda was weighted towards Employment and Social Policy issues. There were no Consumer Affairs dossiers on the agenda, and only one Health item was tabled.

The key discussion centred on the review of the European Employment Strategy (EES).

The Council endorsed the Opinion of the Employment Committee and Economic Policy Committee on the future of the EES, which makes more explicit the linkages between the EES and achieving the targets set at Lisbon in 2000. The Employment Committee will now draft an Opinion on streamlining the Employment Guidelines and Broad Economic Policy Guidelines. Discussions will continue at the December ESPHCA and it is expected that the new Strategy will be signed off at the Spring Council in 2003.

The Presidency presented two progress reports without discussion: on agency work, which is likely to appear on the agenda for December's ESPHCA; and on a revised proposal for a directive protecting workers from the risks of exposure to electromagnetic fields and waves, which was remitted for further technical work. The Chairman of the Social Protection Committee reported that the Committee would agree new objectives on social inclusion at the end of October 2002. These would be approved at the European Council in Copenhagen in December. The Chairman also drew attention to two reports for the 2003 Spring Council: on long term care for the elderly and the recently submitted National Strategy Reports on pensions.

The Council held a brief debate on gender and marginalisation in the context of National Action Plans on Inclusion (NAPS incl). The Presidency called for more work to be done on appropriate indicators. All Member States agreed to give greater prominence to gender in the 2003 round of the NAPS incl.

In relation to health issues, the Council discussed the advertising, promotion and sponsorship of tobacco products elements of the World Heath Organisation Framework Convention on Tobacco Control. The Council agreed on how to proceed in light of the forthcoming negotiating round (the fifth) of the Intergovemmental Negotiating Body in Geneva (14-25 October 2002).

Under Any Other Business, the Presidency outlined how the Council would follow up the Johannesburg World Summit on Sustainable Development with a letter to the President of the General and External Affairs Council. There would be Council Conclusions in December. The Commission presented its plans for a Communication on the rights of the disabled people and for a conference on trafficking in humans.

Over lunch, Ministers had a political discussion on the proposal for the replacement of the Standing Committee on Employment with a Tripartite Social Summit on Growth and Employment.


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