3 Customs
| (28210)
5048/07
COM(06) 866
| Draft Regulation amending Council Regulation (EC) No 515/97 on mutual assistance between the administrative authorities of the Member States and cooperation between the latter and the Commission to ensure the correct application of the law on customs and agricultural matters
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| Legal base | Articles 135 and 280 EC; co-decision; QMV
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| Document originated | 22 December 2006
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| Deposited in Parliament | 9 January 2007
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| Department | Revenue and Customs
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| Basis of consideration | EM of 22 January 2007
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| Previous Committee Report | None
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| To be discussed in Council | May 2007
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| Committee's assessment | Politically important
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| Committee's decision | Not cleared, further information requested
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Background
3.1 Council Regulation (EC) No 515/97 is the legal basis for mutual
assistance between the administrative authorities of the Member
States with responsibility for ensuring the correct application
of the law on customs and agricultural matters. The Regulation
includes provision for a database, the Customs Information System,
which is used by the relevant authorities to post alerts of risks
of irregular operations by transmitting information for the purposes
of sighting, reporting, discreet surveillance or specific controls.
The document
3.2 This draft Regulation is to amend Regulation (EC) No 515/97
to reflect subsequent changes in other relevant instruments which
impact on the Regulation and, more substantively, to introduce
enhancements to the Regulation to improve the ability of Member
States and the Commission to more effectively prevent, investigate
and prosecute operations that are in breach of customs and agricultural
legislation by;
· introducing
a structured information exchange mechanism without prior request
from the receiving Member State, similar to that already in place
in the fields of value added tax and excise duties;
· setting
up a European data directory by allowing the Commission to negotiate
access to a variety of existing public and private sector databases
covering international trade, the content of which can be used
for analysis with the objective of detecting potential irregularities
and by making that information available to Member States' relevant
authorities;
· making
available to the relevant authorities of Member States, at their
request, the services and infrastructure of the Commission in
order to coordinate operational cooperation;
· allowing
a Member State, providing information to another Member State,
to give prior consent for onward transmission of that information
to a third country where an appropriate agreement or protocol
is in place;
· amending
the provisions on the control of personal data to conform with
current relevant Community law on data protection and including
reference to the establishment of the European Data Protection
Supervisor;
· extending
the functionality of the Customs Information System to include
strategic and operational analysis;
· creating
a database of past and current investigations for Member States
to check which other authorities have conducted similar investigations;
· designating
the Regulation as the basic act on which financing for the technical
and service infrastructure to support the systems and procedures
described in the Regulation is based; and
· amending
the scope of the Committee, which advises on the management of
the systems and procedures covered by the Regulation and which
is comprised of representatives from the Member States and chaired
by the Commission, to
reflect the new provisions contained in the
proposal.
The Government's view
3.3 The Paymaster General (Dawn Primarolo) tells
us that the Government supports improvements in the mutual assistance
mechanisms used by the Member States and the Commission to fight
fraud against the financial interests of the Community in the
field of customs and agriculture legislation and to effectively
control the borders to detect counterfeit goods and other illicit
dealings such as in drugs precursors. She says that insofar as
the draft Regulation is an updating exercise to reflect subsequent
changes in other legislation it has the Government's broad support.
But it has reservations about some of the ideas for extending
the scope of the existing Regulation.
3.4 The Minister says that the Government can support
the proposed provisions:
· allowing
for automatic data exchange;
· using
Commission services for operational cooperation; and
· on data
protection (but the Government is checking with the Information
Commissioner that he is also content).
3.5 The Minister then outlines the matters on which
the Government has reservations:
· setting
up a European data directory. The principle of using relevant
databases to assist the control authorities in their work is supported.
But there are concerns relating to the added value of doing this
at the level of the Community, as it is the relevant national
authorities who have the responsibility of analysing and managing
the risks for which they are responsible, to having liaison officers
posted to Brussels, which could be costly, resource intensive
and questionable, and to the legal basis on which the Commission
could have access to this information;
· giving
prior consent to forward information to a third country. The Government
can understand the administrative case for allowing a Member State
that provides information to another Member State to give prior
consent for onward transmission of that information to a third
country. But it wants confirmation that sufficient safeguards
are in place to ensure that information cannot be transmitted
to an inappropriate third country;
· using
data on the Customs Information System for analytical purposes.
There is no indication of what benefits having this analytical
function would achieve. The UK authorities, as with other Member
States, already carry out analysis on the information it collects
from a variety of sources; and
· creating
a customs investigations database. The principle is supported.
But there are concerns, as there were with a similar 3rd
Pillar database. The Government wants to be sure the investigations
to be covered are not already catered for by other databases,
or that the remit of other databases could not be extended, before
introducing yet another system.
3.6 The Minister concludes on the policy implications
that her department needs to consult further with the Department
for the Environment, Food and Rural Affairs and the Information
Commissioner's Office whilst reserving its position in the Council's
working group on the draft Regulation until there is sufficient
clarity for a considered view on the issues of concern.
3.7 As for the financial implications of the proposal
the Minister says that the Financial Perspective for 2007-2013
to support the requirements of Regulation (EC) 515/97 total €36.93
million (£25.64 million), but the Commission has not specifically
identified the costs related to the changes or new requirements
that spring from the draft amending Regulation. She says the Government
will need a more detailed explanation from the Commission of what
the funds are intended to cover and how the proposals are catered
for in the Financial Perspective. The Minister adds that, as the
provider of the infrastructure and services on behalf of the Member
States, most of the costs are borne by the Commission. Member
States use existing IT equipment to access and use the systems,
and incur minor extra costs when there are upgrades or new functionalities
to add. She says the Government will want to know if the proposals
will add significantly to what is done currently.
Conclusion
3.8 We can see that this proposal could add to
the effectiveness of the present Regulation governing mutual assistance
between the administrative authorities of the Member States with
responsibility for ensuring the correct application of the law
on customs and agricultural matters and for preventing fraud against
the financial interests of the Community. But we note the Government's
reservations on a number of matters. So before considering the
document further we should like to hear about developments on
these issues during negotiations, particularly in relation to
both data protection and the proposed European data directory.
Meanwhile we do not clear the document.
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