Competitiveness Council – 10-11 December 2012
European Commission - MEMO/12/960 07/12/2012
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Brussels, 7 December 2012
Competitiveness Council – 10-11 December 2012
The last Competitiveness Council under the Cyprus Presidency of the EU's Council of Ministers will meet in Brussels on Monday and Tuesday, 10 and 11 December 2012. Mr Neoklis Sykikiotis, Minister of Commerce, Industry and Tourism, will chair the Council. The European Commission will be represented by Vice-President Antonio Tajani, Commissioner for Industry and Entrepreneurship, Vice-President Joaquín Almunia, Commissioner for Competition policy, Commissioner Michel Barnier, responsible for Internal Market and Services, Commissioner Algirdas Šemeta, responsible for Taxation, Commissioner Tonio Borg, in charge of Health and Consumer Policy, Commissioner Máire Geoghegan-Quinn, responsible for Research and Innovation, and Androulla Vassiliou, Commissioner for Education, Culture, Multilingualism and Youth.
Monday, 10 December
Single Market Act II: adoption of Council's conclusions
The Single Market can do more to bring about new growth and jobs, to strengthen citizens' and businesses' confidence and to deliver concrete day-to-day benefits to them. Modernising and deepening the Single Market is a continuous exercise. The Single Market must respond to a constantly changing world where social and demographic challenges, new technology and imperatives, such as climate change, must be incorporated in policy thinking. This is why the Single Market Act II adopted on 3 October 2012 (IP/12/1054 proposes a second set of priority actions for new growth designed to generate real effects on the ground and make citizens and businesses confident to use the Single Market to their advantage.
The Council will adopt conclusions welcoming the Single Market Act II and calling for a rapid examination of the proposals for the twelve key actions of the SMA II. Commissioner Barnier will welcome the Council conclusions and will take the opportunity to recall that the first priority is to adopt the key actions of the SMA I.
Unitary Patent and International Agreement on the Unified Patent Court1: Presidency report on state of play and endorsement of the final package
Today, European patents have to be validated in each Member State individually and can be challenged separately in the national courts of each Member State. Obtaining patent protection in 25 Member States today costs about €32 000 (compared to €2000 in the US and €600 in China).
At the Competitiveness Council the Commission expects the Council to endorse the final package on the patent reform, i.e. the two regulations for the creation of unitary patent protection (one on how patent holders can obtain European patents with unitary effect that ensures uniform protection for their invention in the 25 participating Member States, and the other on translation arrangements) and the draft agreement on the Unified Patent Court. The European Parliament will vote on the package on 11 December so that the legislative procedure on the regulations for the creation of unitary patent protection could be finalised by the end of this year. The signature of the draft agreement could take place early 2013. The Commission hopes that the first unitary patent will be granted in 2014.
The final package includes a compromise on the last outstanding issue, i.e. the question of the deletion of Articles 6-8 of the regulation (substantive patent law). On the basis of the compromise, Articles 6-8 will be replaced by a new Article 5 which lays down the very basic principles of the unitary patent, including the uniformity of the scope and limitations, and refers to national law for the rest. At the same time, the content of the former Articles 6-8 will be integrated in the draft agreement on the Unified Patent Court. Additional negotiations became necessary after the European Council decided in June to delete Articles 6-8 of the Unitary patent protection regulation. This had re-opened the discussions between the co-legislators.
The patent reform package will enable inventors to obtain a European patent with unitary effect for 25 Member States (all Member States but Italy and Spain). This unitary patent will be granted by the European Patent Organisation (EPO) on the basis of a single application, with very limited translation requirements and at a considerably reduced cost. A single and specialised jurisdiction, the Unified Patent Court, will be set up as a common court for the Member States providing legal certainty for companies.
Revision of the European rules on public procurement: proposal for a Directive on Public Procurement and proposal for a Directive on procurement by entities operating in the water, energy, transport and postal services sectors (First reading)
As part of the Single Market Act (IP/11/469) tabled on 13 April 2011, the European Commission presented on 20 December 2011 its legislative proposals (IP/11/1580) on public procurement. The objective is to put in place more flexible and efficient instruments for the conclusion of public contracts and to ensure the optimal use of taxpayers' money in order to foster growth and job creation, thereby contributing to the objectives of the Europe 2020 strategy. The efficiency of public tendering has become a priority for all Member States in view of the current budgetary constraints.
On 20 February 2012, the Competitiveness Council discussed the conditions of access to the competitive procedure with negotiation and, on 30 May 2012, the deadline and conditions for the full transition to electronic communication for public procurement and the governance measures required for public procurement. It will now debate and aim to agree on the general approach to be followed in the negotiations with the European Parliament.
Commissioner Barnier will acknowledge the progress made on this important element of the Single Market Act and looks forward to starting trialogue negotiations as soon as possible.
Proposal for a Directive on the award of concessions contracts (First reading)
The main objective of the proposal is to ensure legal certainty for public authorities and bidders with regard to the award of concessions contracts. It lays down simple but fundamental rules guaranteeing transparency on the award of concessions to ensure and that public authorities get the best value for taxpayers' money and that EU companies, and in particular for SMEs, have access to business opportunities across the Internal market.
The Commission expects the Council to adopt a General Approach and the mandate to open negotiations with the European Parliament on the proposal for a directive on the award of concessions contracts.
Proposal for a Directive of the European Parliament and of the Council amending Directive 2005/36/EC on the recognition of professional qualifications and Regulation on administrative cooperation through the Internal Market Information System (First reading)
The Cyprus Presidency is due to present a progress report on the modernisation of the Professional Qualifications Directive. This proposal is one of the twelve levels of the Single Market I (IP/11/469), aiming at simplifying the mobility of qualified professionals within the EU.
Commissioner Barnier will welcome the progress of the discussions, notably on the European Professional Card, transparency of regulated professions and modernisation of the minimum training requirements for sectoral professions.
Council Conclusions on Industrial Policy
In the presence of Vice-President Tajani the Council will be invited to adopt Conclusions on the revised industrial policy of the Commission. The text will also highlight a number of sectoral illustrations of this new approach.
Europe needs its real economy now more than ever to underpin the recovery of economic growth and jobs and it needs to reindustrialise for the 21st century. Immediate action should contribute to revert the current downward trend and to promote the re-industrialisation of Europe. Currently industry accounts for about 16% of EU GDP. Therefore, the European Commission has set its goal that industry's share of GDP should be around 20% by 2020.
Europe's industry is well placed to assume this role: Europe is a world-leader in many strategic sectors such as automotive, aeronautics, engineering, space, chemicals and pharmaceuticals. Industry still accounts for 4/5 of Europe's exports and 80% of private sector R&D investment comes from manufacturing. If confidence comes back, and with it new investments, Europe's industry can perform better and start growing again.
On 10 October, the European Commission adopted VP Tajani's proposed strategy for bringing industry back to Europe.
This strategy will be based on four key pillars, namely strengthening investments in innovation (notably in 6 priority areas), fostering better market conditions, facilitating access to finance and recognising the crucial role of human capital and skills.
The Council is expected to welcome this strategy and encourage its concrete implementation by the Commission. In parallel, the Council should acknowledge four recent sectoral Communications, in the areas of construction and the security and automotive industries, as well the cultural and creative sectors.
Vice President Tajani will provide his views on the draft Council Conclusions presented by the Cyprus Presidency and welcome the strong signal given by Member States on the importance of industry in Europe's recovery path and the need to foster conditions for Europe to reap the benefits of the third industrial revolution.
In the context of serious difficulties, Vice President Tajani and the Council are expected to express their concern over the current situation of the automotive industry in Europe. The depressed levels of sales currently experienced on almost all European markets have exacerbated the structural problem of overcapacity in the European automotive industry. The Council will look at actions in the field of state-aid control and restructuring and the Commission is expected to make a strong call for European coherence of national measures in support of the automotive industry.
With 12 million sector-related jobs the automotive industry is vital for Europe's prosperity and job creation. The EU needs to maintain a world-class car industry, producing the most energy efficient and safe vehicles globally and providing high-skilled jobs to millions. To make this happen, the European Commission tabled on 8 November the CARS 2020 Action Plan aimed at reinforcing this industry's competitiveness and sustainability heading towards 2020.
The Commission proposes a massive innovative push by streamlining research and innovation under the European Green Vehicle Initiative. Co-operation with the European Investment Bank will be reinforced to finance an innovation boost and facilitate SME access to credit. An EU standard recharging interface will provide the regulatory certainty needed to facilitate a breakthrough for large scale electric car production.
Innovation in the automotive industry will also be stimulated through a comprehensive package of measures to reduce CO2, pollutant and noise emissions, to drive improvements in road safety and develop technologically-advanced intelligent transport systems (ITS).
In parallel, the Commission also proposes to address the immediate problems in the car sector. In response to a fall in demand on European car markets and plant closure announcements, the Commission will in November bring together car producers and trade union representatives and Ministers of Industry ahead the next Competitiveness Council to review measures for dealing with the present crisis in a co-ordinated way. The car industry is important throughout Europe and a European response is needed. This response should focus on addressing overcapacity, social and technological investment, as well as state aid and demand-side measures, followed by a discussion at the political level.
Many Ministers and the Commission are expected to call on the upcoming Irish Presidency to continue the discussion and monitor the implementation of the CARS 2020 Action Plan.
Modernisation of the State aid rules - impact on EU Competitiveness
Vice President Joaquín Almunia will present the European Commission's proposal on EU State Aid Modernisation, which will be followed by a policy debate. The reform of state aid policy is expected to be completed during 2013.
On 8 May 2012, the Commission presented the integrated strategy (IP/12/458). The main objectives are: (1) fostering sustainable, smart and inclusive growth in a competitive internal market, with efficient and effective aid measures contributing to the quality of public finance; (2) focussing on cases with the biggest impact on the internal market; and (3) streamlining rules and providing for faster decisions.
Within the framework of the State Aid Modernisation, the Commission presented on the 5th December 2012 proposals to amend two key state aid instruments: the Enabling Regulation and the Procedural Regulation. The Enabling Regulation allows the Commission to declare certain categories of aid compatible and exempt them from notification to the Commission. In this context, the amendment would allow to exempt new categories of aid, such as aid for culture, innovation or aid in relation to natural disasters. The Procedural Regulation sets out the rules governing state aid investigations and focuses mainly on two areas: improving the handling of complaints and ensuring that the Commission obtains complete and correct information from the market.
Both proposals would allow faster decision-making and the Commission to focus its enforcement on what matters most at the EU level. They are thus crucial elements of the State Aid Modernisation package.
Protection of intellectual property rights (IPR)
The Council is expected to adopt an action plan to combat IPR infringements for the years 2013-2017. This will build on the previous Action Plan (2009-2012) proposed by the Commission which aims at tackling the global problem of massive violations of IPR in trade of goods. In 2011 alone, the customs enforcement of IPR in the EU resulted in almost 115 million articles detained (IP/12/823). In a context where the competitiveness of economies is increasingly based on creativity and innovation, it is crucial to protect IPR properly.
The strategic objectives of the new Action Plan are therefore the following:
The Council is due to reach a partial agreement on the Commission's proposal for a Customs programme.
National customs administrations make a substantial contribution in helping to raise revenue for the EU and Member States' budgets every year and deliver considerable benefits to EU citizens and business, whether it is through blocking unsafe or illegal imports or facilitating trade. In order to build on this work and allow customs administrations in the Member States to be even better equipped to meet future challenges in these fields, the European Commission on 29 August 2012 adopted a proposal for the Customs 2020 programme.
The programme would run for 7 years from January 1 2014. Customs 2020 would support cooperation between customs authorities in the EU to help maximise their efficiency and facilitate the functioning of the Customs Union. It would facilitate networking, joint actions and training amongst customs personnel, while also funding IT systems to enable the development of a fully-fledged electronic customs in Europe.
Union Customs Code
The Council is due to hold an orientation debate on the Commission's proposal for a Union Customs Code.
The Commission proposal aims at recasting the Modernised Customs Code adopted in 2008 (MEMO/08/101) with a view to:
Thus, this recast would create the legal conditions for the streamlining and simplification of customs rules and procedures and facilitating the monitoring of customs transactions. Its rapid adoption is necessary to allow the modernisation and the proper functioning of the Customs Union.
Tuesday, 11 December
Relations between the EU and the European Space Agency
The Competitiveness Council will have a political debate on future relations between the European Union and the European Space Agency (ESA). This discussion follows a Communication adopted by the Commission on 14 November 2012.
This Communication defends the idea of a “rapprochement” of the ESA towards the EU environment, without ESA losing its defining characteristics which have made it a successful organisation.
Member States are expected to express their views on the future of EU-ESA relation and provide feedback on the initial ideas presented by the Commission and the way forward. This debate should feed into the work of the incoming Irish Presidency, which should take this discussion forward in the first half of 2013.
European Research Area
The Council is expected to adopt conclusions on the further development of the European Research Area (ERA) following the presentation by the Commission in July of its Communication: 'A Reinforced European Research Area Partnership for Excellence and Growth". The Communication set out five priorities and steps Member States should take to make the ERA a reality by 2014, as requested by EU leaders. The Council is expected to welcome the proposed priorities and actions, as well as the Commission's approach, including deepening through the involvement of research stakeholder organisations. Member States are to be invited to identify domestic measures needed to contribute to ERA and to present these in their National Reform Programmes starting from the 2013 European Semester. The Commission will be invited to develop a monitoring mechanism, while avoiding burdensome additional data gathering.
Commissioner Geoghegan-Quinn will welcome the Council's acknowledgement of the link between completing the ERA and the Europe 2020 growth and jobs strategy. She will call on Member States to start implementing needed reforms without delay, taking into account national circumstances. She will also emphasise that monitoring and reporting will be crucial and, in that regard, the Commission intends to present a first ERA progress report by the end of 2013.
The Council will review the final pieces of legislation related to Horizon 2020, the future framework programme for funding research and innovation from 2014 to 2020. The first concerns the specific programme laying down the implementation modalities and main goals of the programme: fostering excellent science, industrial leadership and meeting societal challenges. Second, the Council will take note of a report on the progress made regarding the Euratom proposal, which complements Horizon 2020 in the field of nuclear research. At their meetings in May and October, the Council already reached a so-called partial general approach (preliminary agreement pending the European Parliament's first reading) on the parts of the Horizon 2020 package related to the programme's objectives and rules for participation. Parliament has since adopted reports on the legislation at committee level but does not plan to vote on them in plenary until the outcome of the multi-annual financial framework (MFF) negotiations is known.
International cooperation in research and innovation
The Council will exchange views on the Commission Communication 'Enhancing and focusing EU international cooperation in research and innovation: a strategic approach' (IP/12/967). The Communication was adopted on 14 September and launches a new strategy for developing the Union's international cooperation actions in research and innovation, in particular with a view to preparing for Horizon 2020. Commissioner Geoghegan-Quinn will stress that, while continuing with the tradition of openness to third country participation, the new strategy proposes to focus international cooperation activities more strongly on the Union's strategic priorities.
European Institute of Innovation and Technology
The Council will seek to reach a 'partial general approach' (agreement pending adoption of the European Parliament's opinion) on the Strategic Innovation Agenda for the European Institute of Innovation and Technology (EIT). This follows a similar agreement (at the Competitiveness Council in October) on the EIT Regulation.
The EIT was established in 2008 to promote the competitiveness of Member States by bringing together excellent higher education institutions, research centres and businesses to focus on major societal challenges. The EIT operates through Knowledge and Innovation Communities (KICs) which each bring together 80-100 partners from across Europe. To date, three KICs have been created, focusing on climate change (Climate KIC), Information and Communication Technologies (EIT ICT Labs) and sustainable energy (KIC InnoEnergy).
The Commission has put forward two proposals concerning the EIT: the Strategic Innovation Agenda, which outlines its priorities for the future, and an amended Regulation, paving the way for its expansion. As part of its Horizon 2020 proposal, the Commission envisages significantly stepping up funding for the EIT (see IP/11/1479 and MEMO/12/839). On 28 November, the European Parliament's Industry, Research and Energy Committee (ITRE) voted in favour of allocating a 3.3% share of the total Horizon 2020 budget for the EIT in 2014-2020. The MEPs also called for the creation of up to four new KICs in 2014 from the following list: healthy living and active ageing, raw materials, urban mobility, food for the future, added-value manufacturing.
Marie Skłodowska-Curie Actions
The Council is also expected to reach a partial general approach on the re-named Marie Skłodowska-Curie Actions (MSCA), which will support excellent researchers and doctoral training (MEMO/12/830), including funding for industrial doctorates, joint doctorates and other innovative research training. The MSCA will also support exchanges of research and innovation staff within partnerships of universities, research institutions, research infrastructures, businesses, SMEs and other actors across Europe, as well as with non-EU countries to strengthen international cooperation.
On 28 November the ITRE Committee in the European Parliament voted in favour of increasing the budget share of the MSCA in Horizon 2020 from 7.4% to 8.3% and endorsed the main elements of the Commission's proposals. Among other things, this will mean an increase of the availability of doctoral programmes and an extension of the COFUND mechanism, which provides a link with cohesion funds.
Proposal for a Directive on alternative dispute resolution AND Proposal for a Regulation on online dispute resolution – Information by the Presidency
The Cyprus Presidency will inform the Council about the state of play on the ADR and ODR proposals. The co-legislators, with the participation of the Commission, negotiated the two proposals with a fast-track procedure.
The last trilogue took place on 5 December, during which all pending points were agreed on and a final agreement was reached.
Commissioner Borg will inform the Ministers on the agreement reached between the Council and the Parliament on the ADR and ODR proposals.
Mr Borg will also refer to the importance of the ADR/ODR proposals and highlight that the Commission will continue to work closely with the Member States to ensure the correct and timely implementation of the Directive.
Proposal for a Regulation on a Consumer Programme 2014-2020 - Information from the Presidency
The Cyprus Presidency will inform the Council of progress on the Consumer programme.
Commissioner Borg is expected to welcome the progress made so far, and state the Commission's view on the outstanding issues.
8th Consumer Markets Scoreboard - Information from the Commission
Commissioner Borg will have the opportunity to present the results of the 8th Consumer Markets Scoreboard. The Scoreboard is published in spring and autumn every year, and the autumn edition ranks some 50 consumer markets using indicators such as comparability of offers, trust in retailers, problems, complaints, satisfaction, switching, pricing and safety.
Mr Borg will highlight the link between the functioning of the consumer market and economic growth and promote the use of Scoreboard data domestically and at all stages of the European Semester process.
Commissioner Borg will also inform the Council about the key findings of the latest Scoreboard and express concern about the continued underperformance of some key services markets.
The UPC agreement is an intergovernmental agreement outside the scope of the EU. Therefore, there is no Commission proposal.