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Brussels, 31 May 2006

Competitiveness Council – Brussels 29 and 30 May 2006

Verheugen points:

Council conclusions on industrial policy

The Council adopted conclusions regarding the Communication for a modern industrial policy the Commission tabled in October 2005. The Council recalled the importance of a rapid and well coordinated follow-up to the Commission's Communication and a successful implementation of the seven horizontal and seven sectoral initiatives announced therein as an important contribution to achieve the goals of the Lisbon Strategy on growth and jobs; Community initiatives should take into account measures at national level reflecting the specific situation in individual Member States. The Council also stressed the importance of combining the horizontal and sectoral dimensions of EU industrial policy and welcomed the well balanced working programme outlined in the Commission's Communication. It further welcomed the setting up of the High Level Group (HLG) on competitiveness, energy and environment with a view to further enhancing the coherence of these policy areas which are crucial for sustainable growth and employment in Europe, and looks forward to the recommendations of the HLG on key issues such as the functioning of energy markets and the EU emission trading scheme.

Review of the EU sustainable development strategy

The Council had a policy debate based on a Presidency questionnaire. On 13 December 2005 it presented a Communication. The review aims at further developing the Sustainable Development Strategy rather than replacing it. It is committed to ensuring that links between European policy initiatives are exploited and tradeoffs assessed to achieve sustainability objectives. Vice President Verheugen noted that the Lisbon strategy for growth and jobs was an essential component of the overarching objective of sustainable development focusing primarily on actions and measures aimed at strengthening the economy and employment. Achieving the objectives of sustainable development is a long term ambition which necessitates a structural change of our economies by investing into new ways of production, technological innovation, energy efficiency and research and development. Without a competitive and dynamic economy it would be impossible for the EU to generate the necessary financial resources to achieve this objective. At the same time, the renewed Lisbon Strategy aims to ensure that economic growth is increasingly environmentally sustainable. Focus is placed on investment in environmental technologies that boost competitiveness and improve the environment, replacing old technologies with new ones that allow higher growth and reduce pressure on natural resources. Promotion of Eco-innovation is a key priority of Lisbon.

Better Regulation

The Council heard a progress report from the Commission and had an exchange of views (public debate). Commissioner Verheugen took stock of the latest developments.

In June 2005, the Commission endorsed the revised internal Guidelines for impact assessments (IA), which now serve to assess all major legislative and policy proposals in the priority list of the Commission's annual Work Programme. Impacts are examined on the economic, social, and environmental level. In March 2006, the IA Guidelines were updated so that assessment of administrative costs is now a compulsory and integrated part of impact assessments. An independent evaluation of the Guidelines, to be launched in 2006, will provide the Commission with conclusions about the performance of the current IA system and areas for further enhancement.

A new phase of the EU simplification work which builds on the past simplification work, but with a marked focus on the Lisbon Agenda objectives, was launched in October 2005. More than 350 pieces of EU legislation have been suggested by the Member States and stakeholders as suitable for simplification.

Screening of proposal adopted by the Commission before 1 January 2004: A total of 183 proposals pending before the Legislator since before 2004 were screened. Results: 67 pending proposals will be withdrawn, including 12 from after 01/01/2004. This represents 31% of the initial 183 examined pending proposals. Five proposals will be maintained but economic analysis of impacts will be presented.

Mr Verheugen announced that the Commission would launch a major exercise to measure the administrative costs arising from EU rules (or the way in which they have been implemented) in specific policy areas as part of the ongoing work on simplification, and will, on this basis, come forward with proposals for reducing these administrative costs where appropriate.

Space Policy

The Commission gave a progress report on the development of the European Space Policy and road map. For the preparation of the European Space Policy and related Programme (ESP), a series of milestones have been foreseen in 2006 and 2007 in order to involve as far as possible the main actors in the space sector in Europe, including Member States. The main objective is to have an ESP adopted by the College of the Commission in the first quarter of 2007 and endorsed by a Space Council under the future German Presidency of the EU in the second quarter.

The GMES conference in Graz on 19-20 April 2006 was a milestone conference by the Austrian Presidency in the implementation process of GMES, marking the end of a series of sectoral preparatory events. Around 200 people attended the conference. Vice-President Verheugen announced the competition for senior school pupils to devise a new name for GMES.

Services Directive

Ministers continued their discussions on the proposed directive on services in the internal market. The discussions were based on the amended version brought forward by the Commission in April (IP/06/442) which reflected closely the results of the first reading by the European Parliament in February this year. The Council reached political agreement on a draft directive which will now go to the European Parliament for second reading. The amended proposal aims to reduce regulatory fragmentation and to encourage and facilitate growth in cross-border service provision. It will remove barriers and enhance consumer confidence the aim is to help to create more growth and jobs in the EU by freeing up cross-border trade and investment in services. Businesses will find it easier to establish anywhere in the EU, saving time and money. They will also find it easier to provide services across borders – Member States will be obliged to remove unjustified obstacles. Consumers will have more choice, information and protection. And services providers will be properly supervised under enhanced provisions for cooperation between national authorities. The next stage will be the second reading in the European Parliament with the aim of adopting a final text during the Finish Presidency in the second half of 2006.

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