Documents Not Cleared
1 Marketing of construction products
| (29711)
10037/08
COM(08) 311
+ ADDs 1-2
| Draft Regulation laying down harmonised conditions for the marketing of construction products
Commission staff working documents: impact assessment and summary of assessment
|
| Legal base | Article 95 EC; co-decision; QMV
|
| Department | Communities and Local Government
|
| Basis of consideration | Minister's letters of 18 May 2009 and 10 March 2010
|
| Previous Committee Report | HC 16-xxv (2007-08), chapter 3 (25 June 2008); and HC 19-vii (2008-09), chapter 2 (11 February 2009)
|
| To be discussed in Council | 23-24 May 2010
|
| Committee's assessment | Politically important
|
| Committee's decision | Not cleared; further information awaited
|
Previous scrutiny of the document
1.1 When we first considered this draft Regulation
in June 2008, we noted that the Council had adopted a Directive
in 1989 ("the Construction Products Directive") which
specified conditions for the marketing of products used in the
construction of buildings and civil engineering works.[1]
The aim was to ensure that reliable information was presented
about products and to help establish fair competition in the EC's
single market.
1.2 If a product is marked with "CE"
(conformité européene) consumers know that
it has been assessed against a common European standard. CE marked
products should be accepted onto the market anywhere in the European
Economic Area. The CE mark indicates the characteristics of the
product but does not guarantee that it is suitable for a particular
purpose.
1.3 In May 2008, the Commission proposed the
repeal of the Construction Products Directive and its replacement
by this draft Regulation. It had two main reasons. First, the
1989 Directive has not succeeded in creating a single market for
construction products partly because of differences in the way
in which Member States have transposed the provisions into national
law. For example, some Member States (including the UK) have voluntary
CE markings whereas, in others, CE marking is compulsory. Second,
the Commission wished to make the requirements for the marketing
of construction products easier to apply, more effective and less
onerous for manufacturers (especially for small businesses).
1.4 The main differences between the Construction
Products Directive and the proposed Regulation are as follows:
- The Regulation would have direct effect. Member
States would not need to transpose it. So there would be no room
for Member State to apply the requirements differently in their
national legislation. The Commission's aim is to remove nationally-created
obstacles to fair competition in a single market for construction
products.
- The arrangements for assessing new and innovative
products which are not covered by harmonised standards would be
simplified and standardised.
- For unique products and products produced by
"micro-enterprises" (that is, enterprises with fewer
than 10 employees and an annual turnover of not more than €2
million) there would a simplified process for the assessment and
verification of the product's performance using Standard Technical
Documentation.
1.5 In June 2008, the Government told us that
the greatest change for the UK, if the proposed Regulation were
adopted, would be the introduction of mandatory CE marking. The
effects of mandatory marking would be felt especially by UK businesses
which trade only on the domestic market and which are, therefore,
less likely to be using the CE mark at the moment.
1.6 We concluded that the aims of the proposal
— simplification and clarification of the requirements for
the marketing of construction products and the removal of barriers
to the single market —seemed admirable. But the negotiations
had only just begun, the Minister's Impact Assessment of the proposal
was not yet available and the Government would be consulting stakeholders.
So we decided to keep the document under scrutiny and asked the
Government to send us a report on the consultations, a copy of
the Impact Assessment and progress reports on the negotiations.
1.7 In his Supplementary Explanatory Memorandum
of 4 February 2009, the Parliamentary Under-Secretary of State
at the Department for Communities and Local Government (Mr Iain
Wright) provided the information for which we had asked. He said
that, during the negotiations in the Council Working Group, the
Government had given broad support to the Commission's draft Regulation
subject to some amendments. It had opposed changes proposed by
the French Presidency and the European Parliament which, in the
Government's view, risked creating extra burdens for industry
and conflicting with the principle of subsidiarity.
1.8 The Minister enclosed with his Supplementary
Explanatory Memorandum the final version of the Government's Impact
Assessment. It takes account of the comments the Government received
from the industry and others when it consulted them about a draft
of the assessment. The main findings of the final Assessment were
as follows:
- the voluntary take-up of CE marking in the UK
is likely to be about 60%;
- a move to mandatory CE marking would probably
impose on UK manufacturers a one-off cost of £40 million
and subsequent annual costs of £7 million;
- it had not been possible to quantify the potential
benefits of the draft Regulation; and
- mandatory CE marking would have a disproportionately
adverse effect on the manufacturers (mostly small businesses)
of individual products made for a particular project.
1.9 The Government's consultations on the draft
Regulation lasted from July 2008 to January 2009. Key points from
the responses were:
- manufacturers who already use CE marking were
in favour of or neutral about the proposed move to mandatory marking,
whereas those who do not were opposed to the move; and
- there was strong and widespread opposition to
the proposal for a simplified process for the assessment and verification
of products made by micro-enterprises on the grounds that the
proposals were unclear, could cause confusion and might provide
insufficient checks on products which are safety-critical.
1.10 In our report of 11 February 2009,[2]
we noted that there were still disagreements between Member States
on some major questions. Moreover, it was by no means clear that
the amendments the European Parliament was likely to propose at
first reading would be acceptable. We decided, therefore, to keep
the document under scrutiny and asked the Minister for a further
progress reports.
The Minister's letter of 18 May 2009
1.11 In his letter of 18 May, the Minister told
us that:
- the European Parliament had adopted the draft
Regulation at first reading and had approved about 100 amendments
to it;
- there had been no prospect of a first reading
deal;
- the Government welcomed this because more time
was needed to find solutions to the remaining disagreements; and
- the Minister hoped that the Council and the European
Parliament would be able to reach a second reading deal in the
first half of 2010.
The Minister's letter of 10 March 2010
1.12 In his letter of 10 March, the Parliamentary
Under-Secretary of State (Lord McKenzie of Luton) says that the
main difference of opinion between Member States is about whether
the CE marking should be compulsory for all products. The Government's
position during the negotiations in the Council working group
has been that, if CE marking were to become mandatory, it should
be linked to national or local building/works regulations, which
set out the characteristics that are required for the product
to be used in a particular area. The Minister adds that:
"The view of some other Member States is that
the CE marking should be much broader, where many characteristics
must be declared. They claim that this is to guard against products
moving across borders with insufficient performance information,
and that if necessary, exemptions could be provided for certain
micro-enterprises. The UK has argued for a proportionate and clear
system for all businesses, not an onerous system for some and
a complex system of exemptions for others."[3]
1.13 The Minister says that there has also been
much debate about the Commission's proposals for simplified procedures
for the products of micro-enterprises and manufacturers of one-off
bespoke products. The Government now has a better understanding
of the provisions and thinks that they could be acceptable and
even beneficial to the UK.
1.14 The Minister tells us that many of the European
Parliament's first reading amendments were minor and acceptable.
But some were not, such as the proposal to require manufacturers
to declare whether their product contains a dangerous substance.
The Commission and a majority of Member States, including the
UK, believe that this would create an undesirable overlap with
the REACH Regulation.[4]
1.15 Finally, the Minister tells us that the
Spanish Presidency is aiming for a political agreement to the
Regulation at the Competitiveness Council on 23-24 May. He adds:
"If they [the Presidency] are to succeed in
this, then discussion on the key articles will need to be settled
in the next few weeks, and at that stage we would hope to be able
to submit this text to the Commons and the Lords committees for
consideration in advance of a vote. I intend therefore to write
to you again in March either to request that the scrutiny reservation
be lifted in advance of a Council vote, or to inform you that
there is still no agreement and negotiations are to continue."[5]
Conclusion
1.16 We are grateful for the Minister's helpful
progress report. It is clear that disagreement remains on some
key points and, most importantly, about whether the CE marking
should be compulsory and what special provision should be made
for small businesses. Moreover, the European Parliament has not
yet given the draft Regulation its second reading and we do not
know what amendments it will propose. Because these major uncertainties
remain, we shall keep the draft Regulation under scrutiny and
welcome the Minister's intention to write to us again when the
position is clearer.
2 Quality and safety of
human organs for transplantation
| (a)
(30265)
16521/08
COM(08) 818
+ ADDs 1-2
(b)
(30266)
16545/08
COM(08) 819
+ ADDs 1-2
| Draft Directive on standards of quality and safety of human organs intended for transplantation
Commission staff working documents: impact assessment and summary of assessment
Commission Communication: Action Plan on Organ Transplantation (2009-15): Strengthened cooperation between Member States
Commission staff working documents: impact assessment and summary of assessment
|
| Legal base | (a) Article 168(4)(a) TFEU; co-decision; QMV
(b) —
|
| Department | Department of Health
|
| Basis of consideration | Minister's letters of 19 May and 24 November 2009 and 18 March 2010
|
| Previous Committee Report | HC 19-iii (2008-09), chapter 5 (14 January 2009); HC 19-viii (2008-09), chapter 6 (25 February 2009); and HC 19-xiv (2008-09), chapter 5 (22 April 2009)
|
| To be discussed in Council | 7-8 June 2010
|
| Committee's assessment | Legally and politically important
|
| Committee's decision | (Both) Not cleared; further information requested
|
Background
2.1 Article 168(1) of the Treaty on the Functioning
of the European Union (TFEU) provides that action by the EU on
public health should complement national policies and be directed
to the improvement of public health and the prevention of illness
and disease. Article 168(2) requires the EU to encourage cooperation
between Member States to improve public health. Article 168(4)(a)
authorises the Council to adopt measures setting standards of
quality and safety for human organs, blood and other substances
of human origin. Article 168(7) requires EU action to pay full
respect to the responsibilities of the Member States for the organisation
and delivery of health services and medical care and says that
quality and safety measures adopted under Article 168(4)(a) "shall
not affect national provisions on the donation or medical use
of organs".
2.2 Similar provision was made in Article 154
of the EC Treaty; in particular, Article 168(4)(a) and 168(7)
TFEU are word for word the same as Article 152(4)(a) and Article
152(5) of the EC Treaty.
2.3 In June 2007, we considered a Communication
by the Commission on organ donation and transplantation.[6]
It suggested ways in which the EC and Member States might increase
the supply of organs and improve the quality and safety of transplantation.
The Commission advocated the preparation of an Action Plan to
encourage cooperation between Member States and EC legislation
to establish basic principles of safety and quality.
2.4 In our report to the House on the document,
we recognised the potential benefits of cooperation between Member
States to disseminate best practice and agree common standards
for the safety and quality of donated organs. But we endorsed
the Government's view that vigilance would be needed to ensure
that Community action was consistent with the principle of subsidiarity.
We also drew attention to the need to ensure that the proposed
Directive was compatible with the requirement in Article 152(5)
EC that any new legislation should not affect national provisions
on the donation or medical use of organs.
Previous scrutiny of the documents (a) and (b)
2.5 In January 2009, when we first considered
the draft Directive (document (a)) and the proposed Action Plan
(document (b)), we noted that these were the documents the Commission
had advocated in its Communication.
2.6 Document (a) specifies common quality and
safety standards for the donation, storage, transport and transplantation
of human organs. For example, it provides that Member States should
ensure that:
- there is a national quality programme to ensure
compliance with the requirements of the Directive;
- the donation of organs takes place in a "procurement
organisation" (that is, in a hospital or other body authorised
by the national competent body to procure organs in specialised
facilities which minimise risks of contamination);
- transplantation takes place in an authorised
"transplantation centre"; and
- all organs can be traced from donor to recipient
and vice versa and that the relevant data is kept for a minimum
of 30 years.
2.7 The Commission's Action Plan for 2009-15
(document (b)) includes proposals for cooperation between Member
States and the Commission to increase the number of organs donated
and improve access to transplantation. The Plan would not be legally
binding and each Member State would be invited to draw up its
own programme and set its own priorities.
2.8 The then Minister of State at the Department
of Health (Dawn Primarolo) told us that the Government supported
the proposed Directive but would argue strongly that the common
standards should be kept to the minimum necessary to ensure safety
and quality, should not be excessively bureaucratic and should
not impose requirements beyond those which are clinically justified.
2.9 In the Conclusion to our report of 14 January
2009,[7] we noted that
the Commission had cited Article 152(4)(a) of the EC Treaty as
the legal base for the draft Directive and that Article 152(5)
expressly said that the measures referred to in Article 152(4)(a)
'shall not affect national provisions on the donation of or medical
use of organs'. The Minister had told us that the Human Tissue
Act 2004 and the Human Tissues (Scotland) Act 2006 make national
provision on those matters. It was not readily apparent to us,
therefore, that the draft Directive complied with Article 152(5).
We asked the Minister for her views on the matter.
2.10 In her reply of 11 February 2009, she said:
"The Government's view is that there is a distinction
to be drawn between provisions about the quality of organs (which
are to be donated) and rules about donation of organs (such as
consent, who may receive an organ, priorities for receipt of an
organ, whether organ donation can take place at all, whether there
can be donations from living persons etc.). Making quality rules
about organs which are to be donated is not about donation of
organs, but rather a different matter — the quality of the
organs. The Human Tissue Act 2004 and the Human Tissues (Scotland)
Act 2006 make national provision in relation to consent and use
of organs and not in relation to the quality and safety standards
that should be applied to those organs. Even though parts of these
Acts may be amended by the Directive, for example to ensure that
quality and safety fall within the regulation of the Human Tissue
Authority, this would not affect the national rules on consent
and use of organs. Therefore the Government is content that Article
152(4)(a) provides sufficient legal basis for the Directive."
2.11 When we considered the Minister's reply,[8]
we agreed with her that a distinction can be drawn between, on
the one hand, legislation on the donation of organs and, on the
other, legislation on the quality and safety of organs intended
for transplantation. It appeared to us that she considered that
the draft Directive drew that distinction and did not contain
provision on the donation of organs. We found this surprising
because:
- Article 2 of the draft Directive specifically
stated that the Directive applies to the donation of organs intended
for transplantation;
- Article 13 required Member States to: ensure
that donations are voluntary and unpaid; prohibit advertising
of the need for or supply of organs with a view to offering or
seeking financial gain; and ensure that the procurement of organs
is done on a not-for-profit basis; and
- Article 15 contained mandatory requirements about
the action Member States should take to protect potential donors.
2.12 We remained doubtful, therefore, that the
draft Directive fully complied with Article 152(5) of the EC Treaty.
So we asked the Minister for her further comments.
The Minister's letter of 31 March 2009
2.13 In her reply of 31 March, the Minister told
us that, at the meeting of the Council Working Group on 6 March,
the Government had asked:
"for transplantation to be removed from Article
2 as it falls within Member State's competence.[9]
This view was supported by a number of Member States and we await
a draft revised text from the Commission to determine whether
the UK's concerns in this area have been addressed."
2.14 As to whether some provisions of the draft
Directive are inconsistent with Article 152(5) of the EC Treaty,
the Minister's letter said:
"In relation to Article 13 [which required Member
States to ensure that donations are voluntary and unpaid], it
is important for donations to be altruistic and voluntary as part
of ensuring that quality is not jeopardised, for example by people
abusing the system by hoping to gain financially. Article 13 also
seeks to prevent not just the remuneration for, but also the trade
and trafficking of, organs. The requirements under this Article
also help facilitate the lawful cross-border movement of organs
as there might be concerns that financial inducements in other
Member States might compromise the safety and quality of the donated
organ.
"In relation to Article 15 [which contained
mandatory requirements about the action Member States should take
to protect living donors], we believe that requiring that donations
are given with informed consent ('authorisation' in Scotland)
ensures that there is less of a risk of quality and safety being
undermined by other pressures, such as financial inducement, trade
and trafficking. Article 15 also facilitates movement across borders
by removing concerns that any organs might have been donated in
ways that might not satisfy UK requirements. We would draw to
the Committee's attention that this Article does not affect or
require any changes to the law on consent in Member States.
"We also draw to the Committee's attention that
there are precedents for regulation within the Blood Directive
and the Tissues and Cells Directive."
2.15 In the Conclusion to our report of 22 April
2009, we said that we continued to differ from the Minister's
view that the draft Directive complies with the requirement in
Article 152(5).[10] We
were not persuaded the requirements in Article 13 of the draft
Directive that donations be voluntary and unpaid were necessary
only or mainly to ensure the quality and safety of organs for
transplantation.
2.16 We also noted that Article 15(1) of the
draft directive provided that Member States:
"shall take all necessary measures to ensure
that potential living donors are provided with all the information
necessary, as to the purpose and nature of the donation, the consequences
and risks, and on alternative therapies for the potential recipient
to enable them to make an informed choice. The information shall
be supplied in advance of the donation."
2.17 It seemed to us, on a plain reading of the
Articles 13 and 15(1), that they are concerned solely with the
conditions for donation.
2.18 We asked the Minister to reflect further
on the question and tell us her conclusion when she provided her
next progress report on the negotiations. Meanwhile, we kept documents
(a) and (b) under scrutiny.
The Minister's letter of 19 May 2009
2.19 The Minister's reply of 19 May provided
a further explanation of the reasons why she believed that the
draft Directive complied with Article 152)5). She added, however,
that she has some sympathy with the Committee's arguments about
Article 15(1) of the draft Directive and that she would:
"consider entering a scrutiny reservation in
relation to Articles 13 and 15(1). Should this prove necessary,
this will ensure that the legal issues relating to these two Articles
are fully examined in the Health Working Party."
The Minister's letter of 24 November 2009
2.20 The main points of the letter of 24 November
from the current Minister (Gillian Merron) were as follows:
- the working group had discussed the draft Directive
on four occasions since June;
- most of the Government's concerns (unspecified)
had been "taken on board" by the Commission and other
Member States;
- but it would not be possible to judge how far
the UK's points had been accepted until the revised text of the
Directive was circulated in 2010; and
- in September 2009, the working group had discussed
the Committee's concerns about whether some of the Articles comply
with Article 152(5) of the EC Treaty and some other Member States
had "agreed that this issue needed examination".
2.21 The Minister also told us that the Government
had had discussions with the Commission and the Spanish Government
to make sure that its concerns about the Directive were well understood.
In particular, they had discussed the Government's concern that:
- as it stood, the draft Directive would require
the UK to authorise all hospitals engaged in organ donation and
transplantation. The Government thought that this could be unnecessarily
bureaucratic and hoped for greater flexibility;
- in the Government's view, the national competent
authorities should be able to delegate some of their functions
to other organisations; and
- the Government wished to ensure that the draft
Directive did not prevent Member States from setting national
standards which are more stringent than those contained in the
technical annex.
The Minister's letter of 18 March 2010
2.22 In her letter of 18 March, the Minister
tells us that the negotiations on the draft directive have gone
well and that nearly all of the Government's main concerns have
been addressed. She encloses the Spanish Presidency's revised
text of the draft Directive.
2.23 The Minister says that Article 13 of the
Commission's draft and the Presidency's revised text does not
affect the UK's legislation on the donation of organs because
the UK legislation already ensures that all donations from deceased
or living donors are voluntary and unpaid. But in the light of
our concerns about the compliance of the Directive with Article
152(5) EC (Article 168(7) TFEU), the Spanish Presidency has, for
example:
- added a new Recital 16 to the draft Directive.
It says that when donation is made for financial gain, the quality
of the donation process cannot be guaranteed. This is because
improving the quality of life or saving the life of the recipient
is not the main or unique objective of the donation. Moreover,
because of the prospect of gain, the clinical history given by
the donor might not be accurate because the donor or his relatives
might withhold vital information. That would create a risk to
the health or even the life of potential recipients; and
- omitted Article 15(1) (the provision in the Commission's
draft of the Directive which would have required Member States
to ensure that potential living donors are given all the information
necessary about the purpose and nature of the donation, the consequences
and the risks and any alternative therapies available to the potential
recipient).
2.24 Commenting on matters which were of particular
concern to the Government, the Minister says that Article 18 of
the Presidency's text contains a new provision which would enable
the national competent authorities to delegate their functions
to, or be assisted by, other appropriate organisations; and the
new Article 27(2) says that Member States would not be prevented
from maintaining more stringent quality standards than those set
out by the Directive.
2.25 The Government is seeking further amendments
to ensure that hospitals which are already registered under a
healthcare regulator are not required to obtain a separate registration
or authorisation specifically to carry out organ transplantation.
Finally, the Minister says that:
"The draft Organ Directive is currently being
considered by MEPs and a vote on the Organ Directive will be held
at the European Parliament's plenary session on 18 May. In the
meantime, negotiations among Member States and between the Presidency,
the Council and members of the European Parliament will continue.
Should a first reading deal be reached (which is likely in view
of the commitment on all sides to achieve this), the Council will
seek to adopt this Directive at Health Council on 7 and 8 June.
"In view of the progress made in negotiations
and the timetable described above, I am seeking your Committee's
clearance for the Organ Directive."
Conclusion
2.26 We are grateful to the Minister and her
officials for the regular and helpful reports she has sent us
on the progress of the negotiations.
2.27 In our view, the Spanish Presidency's
revised text of the Directive is a marked improvement on the original
draft proposed by the Commission. In particular we welcome the
new Recital 16 and the deletion of Article 15(1). We believe these
changes are necessary to comply with Article 168(7) TFEU.
2.28 But the negotiations are not yet over.
The Government will be seeking further amendments and it is not
known what changes the European Parliament may propose. For these
reasons and because of the importance of the donation and transplantation
of human organs, we think that it would be premature to clear
documents (a) and (b). We should be grateful, therefore, if the
Minister would send us a further progress report on the negotiations.
Meanwhile, we shall keep both documents under scrutiny.
3 Iceland's application
for membership of the European Union
| (31366)
6956/10
+ ADD 1
COM(10) 62
| Commission Communication: Commission Opinion on Iceland's application for membership of the European Union
|
| Legal base | Article 49 TEU; unanimity
|
| Document originated | 24 February 2010
|
| Deposited in Parliament | 3 March 2010
|
| Department | Foreign and Commonwealth Office
|
| Basis of consideration | EM of 18 March 2010
|
| Previous Committee Report | None; but see (31101) 15367/10: HC 5-xii (2009-10), chapter 2 (3 March 2010)
|
| To be discussed in Council | To be determined
|
| Committee's assessment | Politically important
|
| Committee's decision | Not cleared; further information requested
|
Background
3.1 Article 49 TEU states that:
"Any European State which respects the values
referred to in Article 2 and is committed to promoting them may
apply to become a member of the Union. The European Parliament
and national Parliaments shall be notified of this application.
The applicant State shall address its application to the Council,
which shall act unanimously after consulting the Commission and
after receiving the consent of the European Parliament, which
shall act by a majority of its component members. The conditions
of eligibility agreed upon by the European Council shall be taken
into account."
3.2 Article 2 states that:
"The Union is founded on the values of respect
for human dignity, freedom, democracy, equality, the rule of law
and respect for human rights, including the rights of persons
belonging to minorities. These values are common to the Member
States in a society in which pluralism, non-discrimination, tolerance,
justice, solidarity and equality between women and men prevail."
3.3 In Copenhagen, in June 1993, the European
Council concluded that accession will take place as soon as a
country is able to assume the obligations of membership by satisfying
the economic and political conditions required. The "Copenhagen
criteria" require:
— that the candidate country has achieved stability
of institutions guaranteeing democracy, the rule of law, human
rights and respect for and protection of minorities;
— the existence of a functioning market economy,
as well as the capacity to cope with competitive pressure and
market forces within the Union;
— the ability to take on the obligations of
membership including adherence to the aims of political, economic
and monetary union.
3.4 In December 2006, the European Council agreed
that "the enlargement strategy based on consolidation, conditionality
and communication, combined with the EU's capacity to integrate
new members, forms the basis for a renewed consensus on enlargement".
3.5 The Commission also notes that "the
Union's capacity to absorb new members, while maintaining the
momentum of European integration, is also an important consideration
in the general interest of both the Union and the candidate countries."
The Commission Opinion
3.6 Iceland addressed its application to the
Council on 16 July 2009. On 27 July the Council referred the application
to the Commission, seeking its Opinion. The Commission's Opinion
is its formal response to the Council. It is also communicated
to the European Parliament.
3.7 The Opinion recommends opening accession
negotiations.
3.8 The Commission has analysed Iceland's application
on the basis of the country's capacity to meet the Copenhagen
criteria. The method followed in preparing this Opinion is, the
Commission says, the same as used in previous opinions, mutatis
mutandis. The Commission has analysed both the present situation
and the medium-term prospects (medium-term being defined as a
period of three years).
3.9 In line with the renewed consensus on enlargement,
the present Opinion also identifies key policy areas likely to
require particular attention in the event of Iceland's accession
and provides initial impact estimates with regard to key policies
and sectors. The Commission says that it will provide more detailed
impact assessments for these key policy areas at later stages
of the pre-accession process. The report containing the detailed
analysis on which the Opinion is based is made public as a separate
document (Analytical Report for the Opinion on the application
from Iceland for EU membership).
The Government's view
3.10 In his Explanatory Memorandum of 18 March
2010, the Minister for Europe at the Foreign and Commonwealth
Office (Chris Bryant) notes that, as Iceland is already a member
of the EEA, the Opinion has been split into three sections: Chapters
covered by the EEA, Chapters partially covered by the EEA, and
Chapters not covered by the EEA.
3.11 He then says that "the Government welcomes
the Commission's Opinion of Iceland and fully supports Iceland's
EU membership application" and comments on the Opinion as
follows:
POLITICAL CRITERIA
"The Opinion states that Iceland is a functioning
democracy with strong institutions and deeply rooted democratic
traditions. Iceland's judiciary is of a high standard and the
judicial system is well established. There are some areas of concern
given the country's small population, notably the close links
between the political class and the business community. The procedure
for judicial appointments has also been highlighted as needing
improvement. The Commission stresses that mechanisms to reduce
the scope for conflict of interest will need to be strengthened."
ECONOMIC CRITERIA
"The Commission indicates that Iceland can be
considered a functioning market economy. Due to the impact of
the 2008 economic crisis Iceland has a large fiscal deficit, but
the government has been taking measures to reduce it. Fiscal consolidation
and the firm implementation of a credible fiscal strategy remain
key challenges. As a member of the EEA, Iceland has proved able
to withstand competitive pressures and market forces within the
EEA. The economic crisis has seriously affected the investment
capability of the private sector. However, provided appropriate
macroeconomic policies and structural reforms are implemented,
it could regain its capacity to sustain the competitive pressures
of the single market in the medium term."
LEGAL OBLIGATIONS OF MEMBERSHIP
"The Opinion covers the acquis as broken
down into 33 chapters for accession negotiations. In general,
alignment with the acquis is good as Iceland's membership
of the EEA means that its legislation is already aligned with
approximately two thirds of the acquis."
3.12 The Minister then says that "the following
chapters cover areas of the acquis which are of significance
to UK policy, and/or which may require particular attention in
accession negotiations", viz:
"Chapter 9 — Financial services is covered
by the European Economic Area (EEA) Agreement. Iceland is already
a member of the EEA. The Commission assesses that Iceland generally
applies the acquis on financial services but that some
improvements are necessary in order to fully implement the acquis,
in particular. Iceland must address the weaknesses in its financial
supervisory system and the deposit guarantee scheme at an early
stage. The Government has made clear that it is essential for
Iceland to meet its international obligations, including those
under the Deposit Guarantee Directive which is part of its obligations
under the EEA agreement.
"As the Committee will be aware, on 6 March
Icelanders voted 'No' in the referendum on the Icesave loan bill
agreed by the Icelandic government in December 2009. We hope further
talks with Iceland on this issue will resume soon. A satisfactory
resolution of the Icesave issue is necessary to rebuild the confidence
of the international financial community, aid the recovery of
the Icelandic economy and enable Iceland to meet the criteria
and obligations for EU membership.
"Regarding Chapter 11— Agriculture and
rural development, the Commission states that Iceland's agricultural
policy is not currently in line with the acquis and will
need to be adapted before accession. In particular, support measures
must be adjusted to align with EU competition and state aid rules.
Administrative capacity and the processing of agricultural statistics
are other areas which need strengthening. Iceland must also set
up an EU-compliant paying agency and an integrated administrative
and control system (IACS) to manage the common agricultural policy
(CAP). Iceland's possible accession is estimated to have a minor
impact on the CAP under the current acquis. It would probably
account for less than 0.1% of EU-27 CAP spending.
"The analysis on Chapter 13 — Fisheries
states that the Icelandic fisheries management system can be considered
as relatively successful, its overall design and implementation
is similar to those implemented in the EU. In its analysis, the
Commission states that Iceland will have to align with common
fisheries policy (CFP) instruments by accession. These instruments
include fishing capacity management, technical conservation measures
and integrated control measures. Iceland will also have to align
with the acquis in several other areas including the EU
principle of access to waters and EU internal market law. This
covers the right of establishment, the freedom to provide services
and the free movement of capital in the fisheries production and
processing sectors. The UK has an important relationship with
Iceland as a fisheries partner and looks forward to strengthening
it. DEFRA is in the process of consulting industry and other parties
on the best approach to take once negotiations open. The
Opinion indicates that Iceland's accession to the EU would have
a significant impact on the CFP as it stands. The CFP is currently
being reviewed and may be reformed, effective from 2013.
In its analysis of Chapter 27 — Environment,
the Commission indicates that there are several areas in which
Iceland does not fully meet the requirements of the nature protection
acquis, of which the protection of cetaceans (whales, dolphins,
and porpoises) is one. Iceland currently allows the hunting of
fin and minke whales. This is not in line with the EU common position
which does not permit whale hunting in EU waters. The Opinion
states that Iceland will have to undertake the necessary steps
to align with the acquis.
"There are a number of strong conservation minded
Member States, including the UK, who will strive for the effective
conservation of cetaceans. The Government would continue to argue
against any actions which would threaten the protection of cetaceans
within EU waters."
3.13 The Minister then notes that: the Opinion
has no immediate financial implications; that EU financial assistance
for enlargement is delivered via the Instrument for Pre-Accession
Assistance (IPA), with respect to which €1.6 billion will
be committed in 2010 for all eligible countries; and that, in
order for Iceland to be eligible for the IPA, a separate Regulation
must be passed.
The IPA Regulation
3.14 The Instrument for Pre-Accession Assistance
(IPA) is the Community's financial instrument for the pre-accession
process for the period 2007-2013. Assistance is provided on the
basis of the European Partnerships of the potential candidate
countries and the Accession Partnerships of the candidate countries.
The IPA provides assistance which depends on the progress made
by the beneficiary countries and their needs as shown in the Commission's
evaluations and annual strategy papers. Though it does not say
so specifically, the whole pre-accession process is predicated
on the need for support to help less-sophisticated countries reach
EU standards.
3.15 Against this background, the Commission
proposed to change Article 4 and Annex II of the IPA Council Regulation
to allow Iceland, as a potential candidate country, to access
funding from IPA. In his 24 November 2009 Explanatory Memorandum,
the Parliamentary Secretary at the Department for International
Development (Mr Michael Foster) professed himself "supportive
of Iceland's membership application", and therefore "the
principle of Iceland receiving IPA funds." He noted that
Iceland was already closely aligned to the EU through membership
of the European Economic Area and being a signature of the Schengen
agreement, and said that "as a country with a very small
administration, Iceland will need assistance to cope with the
burdens of accession negotiations, (e.g. translation costs) and
with the preparations for the administration of structural funds."
He also pointed out that it was anticipated that Iceland would
receive less than €10 million per year, and only for two
years, that this money would be found from within the existing
IPA financial framework (which amounts to €11.47 billion
in 2007-13) and was too small to affect significantly the percentage
of the instrument which was scored as ODA. He made no mention
of the ICESAVE controversy.
3.16 Although the Parliamentary Under-Secretary
made no mention of its role in this process, we were subsequently
informed by his officials that the proposed amendment required
the agreement of the European Parliament. He also made no mention
of the collapse of Landsbanki in October 2008 and its aftermath.
We therefore awaited further developments.
3.17 We were recently informed that the European
Parliament had given its support to the proposal as drafted, and
that it would therefore be presented to the Council "imminently".
We also received further relevant information from the Minister
for Europe.
The Minister's letter of 25 February 2010
3.18 In his letter, the Minister for Europe at
the Foreign and Commonwealth Office (Chris Bryant) likewise recalled
the events of last July, and continued as follows:
"The Commission has analysed Iceland's application
on the basis of the country's capacity to meet the criteria set
by the Copenhagen European Council of 1993.
"On 24 February 2010 the Commission published
their Opinion recommending opening accession negotiations and
a detailed Analytical Report. We are considering this carefully.
I will provide an explanatory memorandum in due course as normal
but I want to take this opportunity to highlight some key aspects
of the Opinion and our reaction.
"In its Opinion the Commission notes that Iceland
is a parliamentary republic with deeply rooted traditions of representative
democracy and assesses that it satisfies the political criteria.
It assesses that Iceland can be considered a functioning market
economy as required by the economic criteria. It further assesses
that Iceland has a generally satisfactory track record in implementing
its obligations under the EEA and is well prepared to take on
the obligations of membership. The Commission highlights a number
of areas where serious efforts will be needed to align legislations
with the acquis and ensure its implementation and enforcement
including: fisheries; agriculture and rural development; the environment;
free movement of capital; financial services; as well as customs
union; taxation; statistics; food safety, veterinary and phytosanitary
policy; regional policy and coordination of structural instruments;
and financial control. Fisheries negotiations are likely to be
particularly sensitive. We remain determined to see an early end
to Icelandic whaling.
"The UK Government has responded to the Commission's
Opinion by making clear both that we fully support Iceland's application
to join the EU and that it is essential that Iceland meets
its international obligations, including those under the Deposit
Guarantee Directive which is part of its obligations
under the EEA agreement. As the Committees will recall, after
the collapse of Landsbanki in October 2008 the Icelandic compensation
scheme had insufficient funds to reimburse all depositors as required
by the Directive. On 30 December the Icelandic Government agreed
the terms of a loan with the UK and Netherlands to enable Iceland
to discharge its obligations. However, the Icelandic President
refused to sign the bill into law it is now is due to be put to
a referendum in Iceland on 6 March. As I write, talks on the Icesave
loan are continuing between officials from HM Treasury together
with their Dutch colleagues and representatives from Iceland.
"The UK, along with every other Member State,
will want to consider the Commission's recommendation carefully
before deciding whether to open accession negotiations. The accession
process is based on strict criteria. Iceland — like all
candidate states — will have to meet these. The Commission
has made it clear that Iceland must address the weaknesses in
its financial supervisory system and the deposit guarantee scheme
at an early stage. A satisfactory resolution of the Icesave issue
is necessary to rebuild confidence of the international financial
community, aid the recovery of the Icelandic economy and enable
Iceland to meet the criteria and obligations for EU membership."
3.19 The Minister concluded his letter by saying
that he would keep the Committee informed of the progress of Iceland's
membership application.
3.20 There being no reason not to clear the draft
Regulation, we did so. We also reported this to the House because
of the level of political interest in the overall context.[11]
Timetable
3.21 The Minister now concludes his Explanatory
Memorandum by noting that: at the time of writing, EU Member States
are considering the Opinion; the issue is not on the agenda for
the Spring European Council; and it is not yet clear when the
Presidency will bring this issue to the Council for a decision.
Conclusion
3.22 The Minister makes no mention in his
Explanatory Memorandum of the European Parliament, and thus of
the meeting on 8 March — the day after the referendum[12]
— between its Foreign Affairs Committee and Štefan
Füle, Commissioner for Enlargement and European Neighbourhood
policy, on the Commission Opinion on Iceland's application for
membership. At that meeting, the Commissioner said that the outcome
of the referendum should not hinder the accession process as this
was a bilateral matter between Iceland, the Netherlands and the
UK; the European Parliament's rapporteur and others, including
the chair of the Parliament's delegation to Switzerland, Iceland
and Norway and the EEA, agreed that Iceland, the Netherlands and
the UK needed to resolve it by themselves and that it should not
affect the accession process.
3.23 We mention this not to take issue with
the Government's position, but rather to illustrate that there
are different, important views about the relevance of the Icesave
issue in this context.
3.24 The Minister says that there is no imminent
prospect of the Opinion being put to the Council or European Council.
We shall therefore retain the Communication under scrutiny until
the Minister is in a position to write to us with a clear timetable
and an explanation of what has changed in the interim, to include
what he knows of the then views of the Commissioner and of the
European Parliament.
1 Council Directive 89/106/EEC: OJ No. L 40, 11.2.89,
p.12. Back
2
See headnote. Back
3
Paragraph 8 of the Minister's letter of 10 March 2010. Back
4
REACH: the Registration, Evaluation, Authorisation and Registration
of Chemicals Regulation. Back
5
Minister's letter of 10 March, penultimate paragraph. Back
6
(28686) 9834/07: see HC 41-xxvii (2006-07), chapter 6 (27 June
2007). Back
7
See headnote. Back
8
See HC 19-viii (2008-09), chapter 6 (25 February 2009). Back
9
Article 2 of the draft Directive says:
"1. This Directive applies to
the donation, procurement, testing, characterisation, preservation,
transport and transplantation of organs of human origin intended
for transplantation.
"2. However, where such organs
are used for research purposes, this Directive only applies where
they are intended for transplantation into the human body." Back
10
HC 19-xiv (2008-09), chapter 5 (22 April 2009). Back
11
See headnote: (31101) 15367/10: HC 5-xii (2009-10), chapter 2
(3 March 2010). Back
12
Law 1/2010, known as the Icesave Bill, was rejected, with 93%
voting no, less than 2% yes and 5% spoiling their ballot papers,
within an overall turnout of 63%.
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