Select Committee on European Union Forty-Ninth Report


Letter from David Jamieson MP, Parliamentary Under Secretary of State to the Chairman

  I am writing to inform you that the next Transport Council will take place on 3-4 October 2002. I attach a copy of the draft agenda for your information. You will note that as it stands there are four items on the agenda on which a policy commitment may be sought. This is still very much a draft agenda, and will be subject to change before the Council takes place. However, I wanted to write in advance of the imminent Parliamentary Recess to advise your Committee of progress that has recently been made on the four dossiers for which political commitment is proposed.


  This was the subject of Explanatory Memorandum 12597/01, submitted to your Committee on 2 November 2001. The EM was referred to Sub-Committee B on 6 November 2001 (1,080 sift), who cleared it by letter on 19 March 2002.

  I wrote to you on 11 June advising that the Spanish Presidency would be looking to secure political agreement on the TEN dossier at the June Transport Council. Although this was not achieved, the Danish Presidency intends to work through COREPER to make further progress and the prospects for reaching political agreement at the October Council are reasonably good—at least in so far as the main text is concerned.

  However, there continue to be serious difficulties arising from the Commission's proposal to change Annex III (ie the list of priority projects agreed at the Essen and Dublin Councils). A majority of Member States, including the UK, is against making any change to the list until the more fundamental revision in 2004. But in the light of continuing Commission pressure, a number of those Member States have now, without prejudice to their position, requested further schemes for inclusion on the priority list. The Commission intends to establish a high level group to consider the relative merits of both the six projects it proposed originally and the 16 other schemes put forward by Member States. It is highly unlikely this issue can be resolved before December. The UK will be maintaining its line that there should be no changes to the list until 2004. Without prejudice to our position, we have, however, proposed the East Coast Mainline rail project for inclusion on any revised list. We will continue to argue that it is not appropriate to subject the list of priority projects to co-decision procedures.


  This was the subject of Explanatory Memorandum 5532/02 of 14 February 2002. The EM was cleared on 26 February 2002 (1,093 sift). The Presidency hopes to reach a General Orientation or a Common Position in October.

  The UK continues to support this proposal which mirrors the European Civil Aviation Conference's Safety Assessment of Foreign Aircraft Programme in which the UK actively participates. The proposal has yet to be discussed in detail by the Council's aviation working group and is expected to have its First Reading in the European Parliament in early September.


  This was the subject of my Explanatory Memorandum of 13 February 2002 (EM5129/02). The EM was sifted to sub-Committee D on 26 February 2002 (1093rd sift). It was not cleared, and details of the outcome of the Government's consultation exercise were requested.

  The Spanish Presidency held on Working Group meeting to discuss this proposal on 15 February, at which most Member States raised concerns about the high levels of compensation and the cost to airlines. Detailed consideration of the proposal has begun under the Danish Presidency, which has held two meetings since 1 July. The main point of contention continues to be the levels of compensation. A number of Member States have expressed interest in the levels suggested by the European Parliament's rapporteur (

300 for flights of less than 1,000 kilometres,

600 for flights of 1,000 kilometres or more but less than 3,500 kilometres, and

900 for flights of 3,500 kilometres or more). The Commission is currently reflecting upon this. The rapporteur's proposals have yet to be adopted by the Parliament, which is forecast to complete its first reading in October.

  The Department had 13 responses to its consultation. As expected, the airlines were most concerned at the levels of compensation while the charter airlines were concerned about the inclusion within the proposal of inclusive tour passengers travelling on charter flights. This is an issue which the UK has raised at Working Group, and for which several member states have expressed support. All airlines were concerned at the lack of definition of "cancellation" and at the lack of "exceptional circumstances" clause in the article on delays. The Air Transport Users' Council broadly supported the Commission's proposal.

  The Department has prepared a provisional Regulatory Impact Assessment (RIA) on the current proposal, which we hope to submit for your consideration shortly. It is not possible to be categorical in quantifying the financial costs to airlines resulting from the proposal, though we can provide a range of estimates. One leading European airline, for example, has calculated that, as drafted, the proposal would double its costs for denied boarding compensation to

15.6 million. However, given that the Commission has stated its intention to reflect upon the levels of compensation, we propose to delay submitting a formal RIA until the position is clearer. The impact on airlines would also be significantly different if their proposal to define "cancellation" is accepted. [This is yet to be discussed in working groups].

  The Presidency aims to reach political agreement on the proposal at the October Transport Council. It is not yet clear whether this is a realistic aim but if the proposal is ready for political agreement by then, we would envisage placing a Parliamentary scrutiny reserve.


  This was the subject of my Explanatory Memorandum of 11 March 2002 (EM 6093/02) which was sifted to sub-Committee B on 19 March 2002 (1,096th sift). It was cleared from scrutiny on 27 March 2002.

  Despite the efforts of the Spanish Presidency, Ministers were unable to reach political agreement on the proposed Regulation at the Transport Council on 17 June. The Marco Polo programme would offer Community financial support for modal shift projects, with a budget of

85 million and various thresholds for different types of eligible project. At the June Council I joined other Member States in arguing that there should be a reduced budget. Since that time, there has been little progress on this dossier. The proposal is expected to have its First Reading in the European Parliamentary in September.

16 July 2002

Letter from the Chairman to David Jamieson MP

  Thank you for your letter dated 16 July which Sub-Committee B considered at its meeting on 22 July.

  It was very helpful to have the situation on a number of documents, which have been subject to scrutiny by Sub-Committee B and Sub-Committee D, in advance of the October Transport Council. We look forward to hearing of any changes which might occur between now and 3-4 October. We trust you will tell us about decisions reached at the Council.

23 July 2002

Letter from John Spellar MP, Minister of State to the Chairman

  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 amongst 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 65 million, 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.

17 October 2002

Letter from the Chairman to Mr John Spellar MP

  Thank you for your letter dated 17 October reporting on the Transport part of the Transport, Energy and Telecommunications Council held in Luxembourg on 3 October. This was considered by Sub-Committee B at its meetings on 14 October and 28 October. We are very grateful for this summary of the outcome.

  We note in paragraph 8 of your letter you refer to the Presidency's hopes for an agreement in December on the second package of railway proposals (covered by your Explanatory Memoranda: 5721/02, 5723/02, 5724/02, 5726/02, 5727/02, and 5744/02). Sub-Committee B considered these documents at its 26 meeting on Monday 25 March. I wrote to you on 27 March saying that, while we welcomed the proposals in principle, we needed to look more closely at the detail. The Scrutiny reserve on these documents has been maintained.

  I should be grateful if you could give me a detailed account of how far negotiations have progressed on these documents, and how realistic the chances are of agreement in December.

30 October 2002

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