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C/01/18

5278/01 (Presse 18)

2326th Council meeting

- ECOFIN -

Brussels, 19 January 2001

President :

Mr Bosse RINGHOLM

Minister for Finance of the Kingdom of Sweden

CONTENTS

PRESIDENCY AND COMMISSION WORK PROGRAMMES - OPEN DEBATE

The Council held a public debate - transmitted by TV and internet to the press and wider public - on the Swedish Presidency's work programme for the next six months (which is reproduced in Annex) as well as on the Commission programme in this area for the year 2001.

Introducing the debate, the President made a presentation of the priorities of the Swedish programme which focuses on the following issues:

  • Increased employment and improved co-ordination of economic policy

  • Measures against harmful tax competition in order to improve the internal market

  • An integrated financial market in the EU

  • Economic policy dialogue with the candidate countries

  • Improved budgetary procedures and financial control

  • Strengthened EU profile in international economic and financial issues

Swedish Finance Minister RINGHOLM highlighted the challenges in economic policy which the EU is facing in the short and also in the longer term, noting that, fundamentally, conditions for continued favourable economic development are good. To bring this about, and in particular to improve further the employment situation, there was a need to ensure, through appropriate policies and disciplines, continued low inflation, low interest rates and further strengthening of public finances, and to pursue structural reform, essentially with regard to the tax and welfare systems, to meet the challenges of demographic change in the next decades. The President also underlined his conviction that enlargement will contribute to greater prosperity in the both candidate countries and existing Member States.

The Council also took note of presentations by Commissioners SOLBES and BOLKESTEIN of the Commission's intentions in the ECOFIN area for 2001. Commissioner SOLBES fully shared the Presidency's view that employment still was the major priority for the Union and that the good results of the last two years needed to be consolidated by implementing and appropriate policy mix in order to achieve the EU's short and long term objectives. He also emphasised that the full and speedy implementation of the economic and social reform agenda adopted by the Lisbon European Council would provide a key contribution to raising the long term growth and employment potential of the EU. He stressed that the Commission will play a full role in attaining these objectives and that progress made on these matters were key elements for the synthesis report to be presented to the Stockholm European Council.

With the same objectives in mind, Commissioner BOLKESTEIN elaborated in particular on the outlook and the work ahead for the establishment by 2005 - according to the action plan on financial services - of an integrated European financial market. He also addressed the problems of how to tackle the challenges of an ageing population and how to fight harmful tax competition. On financial services he recalled that currently 14 measures were under consideration by the Council and the European Parliament and that the Commission would table during the next six months ten more proposals to complete legislation in this area. He also recalled the Commission proposal of October 2000 concerning additional pension funds and announced a further communication on the taxation of pensions. Finally he stressed the urgency of the High level group's work on the code of conduct on business taxation with respect to the roll back of all potentially harmful measures which had been identified by the group.

The work programmes of the Presidency and the Commission were generally welcomed by Member States as ambitious and well structured. Ministers supported in particular the emphasis given by the Presidency to the problem of employment and the intention to establish a dialogue on economic and financial questions with candidate countries, to be launched on the occasion of the informal ECOFIN meeting in Malmö on 2-22 April. Several Member States also highlighted the need for rapid progress in the area of financial services and to secure the appropriate time at the ECOFIN for examining the final version of the report of the wise man's group presided by Mr LAMFALUSSY expected to be ready next month.

The ambitious plans for ECOFIN in preparing for the Stockholm Summit were seen as vital for a solid follow up of the Lisbon strategy as well as a good preparation for the discussions on the Broad Economic Policy Guidelines.

EXCISE DUTIES ON MINERAL OILS

The Council had a discussion on the prolongation of a number of derogations concerning reductions and exonerations of excise duties for certain mineral oils used for specific purposes. As a certain number of these derogations - 36 according to the Commission - had expired on 31 of December 2000 there is great urgency to reach a decision on this matter in order to fill the existing legal void.

The Council discussions were based on an amended compromise proposal presented by the Swedish Presidency - building on a previous French proposal - providing essentially for a two-year prolongation of the existing three road haulage derogations (for France, Italy and The Netherlands) and a six year prolongation of all other existing derogations. Most Member States could agree on the principles of a solution on the basis of the Presidency's compromise, but a number of details still remain to be worked out.

Under theses circumstances the Permanent Representatives Committee has been asked to continue work on the matter with the aim of reaching an early solution, at the latest at the next ECOFIN Council on 12 February.

Commissioner BOLKESTEIN has indicated that in the absence of a Council decision on the prorogation of the derogations, it was starting to prepare the legal procedures under the Treaty for breach of Community law with respect to the derogations, which no longer had a legal basis.

REPORT ON PUBLIC FINANCES

The Council held an orientation debate on a communication from the Commission(1) and a note of the Presidency on the contribution of public finances to growth and employment in the Member States.

The Council welcomed the communication of the Commission and considered it a good basis for the joint report by the Council and the Commission to be prepared for the Spring European Council in Stockholm.

Delegations agreed on the need to ensure long term sustainability of public finances, a prerequisite for high and sustainable growth, taking into account in particular the ageing population of the Union in the next decades. The increased employment rates, as called for in the Lisbon European Council conclusions, should make a major contribution to achieving this objective, but it may also be necessary to review national pension systems and Member States' ambitions for lower government debt levels. The situation varies among Member States and could require differentiated approaches.

Member States agreed on the need to reduce the tax burden on labour in order to increase the employment rates, but views differ on appropriate compensating measures. Reforms of tax and benefit systems should aim to stimulate employment, savings and investment.

The Council discussed criteria for assessing tax cuts and their implementation as part of the EU budgetary surveillance process of the Broad Economic Policy Guidelines. Ministers discussed the structure of public expenditure and the need to enhance investment in infrastructures and human capital.

The Council has asked the Economic and Financial Committee to pursue the debate on this subject in order to be able to adopt the joint Council and Commission report at its meeting on 12 March.

IMPLEMENTATION OF THE STABILITY AND GROWTH PACT - COUNCIL OPINION ON THE UPDATED CONVERGENCE PROGRAMME OF SWEDEN, 2000-2003

The Council discussed the updating of the Convergence programme of Sweden (2000-2003) and adopted the following opinion:

"THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and co-ordination of economic policies(2), and in particular Article 9 (3) thereof,

Having regard to the recommendation of the Commission,

After consulting the Economic and Financial Committee,

HAS DELIVERED THIS OPINION:

On 19 January 2001 the Council examined Sweden's updated Convergence Programme, which covers the period 2000 - 2003. The Council notes with satisfaction that the updated Programme envisages continued government surpluses throughout the period to 2003 as the Swedish authorities maintain their medium term objective of a budget surplus of 2% of GDP on average over the business cycle. The strategy of lowering the expenditure ratio, aided by tight expenditure ceilings and a balanced budget requirement for local governments, is accompanied by a lowering of the tax ratio. The Council considers this budgetary strategy appropriate. The Council further notes with satisfaction that the debt ratio is expected to fall below the reference value of 60% of GDP in 2000, and to continue to fall substantially over the remainder of the Programme period.

The macroeconomic scenario presented in the programme, with GDP growth of 3.9% and 3.5% for the years 2000 and 2001, appears realistic but for the years 2002 and 2003 no forecasts are presented and the update assumes a cautious 2.1% GDP growth, considered to be the trend growth rate.

The budgetary surpluses targeted in the updated programme provide a large enough safety margin for the general government balance not to breach the 3% of GDP deficit reference value in normal circumstances. The Council considers that Sweden continues to comply with the requirements of the Stability and Growth Pact. Furthermore, the Council welcomes the attention given in the programme to the long-term sustainability of public finances.

The Council notes that Sweden's strategy on this hinges on maintaining a surplus of 2% of GDP over a period of 15 years. By lowering debt and interest payments this will make room to cover much of the costs of ageing to be faced in later years. The Council also encourages Sweden to pursue other routes to restrict expenditure, since the programme recognises that Sweden may have difficulties in maintaining a tax ratio that is markedly higher than in most other countries.

The Council notes that Sweden at present comfortably fulfils the convergence criterion on price stability and that the continued achievement of the domestic inflation target is likely to be consistent with the ECB objective for price stability. Trends in Swedish long-term interest rates in recent years clearly reflect the favourable development of economic fundamentals, which is expected to continue in the future. Following from this, the spread of Swedish long-term interest rates against euro rates has narrowed during 2000, and Sweden continues to fulfil the interest rate convergence criterion. Regarding the exchange rate, although the krona has displayed less volatility in recent years, the Council re-iterates that Sweden needs to demonstrate its ability to stay in line with an appropriate parity between the krona and the euro over a sufficient period of time without severe tensions. To this end, the Council, as stated in its opinion on the updated 1999 convergence programme(3), expects Sweden to decide to join the ERM2 in due course.

In an environment of strong economic growth, continued wage moderation remains an important factor of stability and a moderate outcome of the wage negotiation round for 2001 and 2002 will be crucial in this respect. The indications are that new wage agreements should result in only slightly higher wage increases, but the risks are on the upside. In this context, the Council encourages Sweden to direct fiscal policy so that it supports monetary policy in the achievement of the inflation target, in line with the Broad Economic Policy Guidelines. While inflationary pressures have remained low in 2000 and are expected to be contained during 2001, there is a risk that the economy might overheat and threaten price stability if wage moderation were to weaken. In such a case, an expansionary fiscal stance in 2001 and 2002 would be inappropriate in the face of an economy where output is above or close to potential.

In order to obtain higher and sustainable economic growth, the strategy of previous Programmes is continued and structural measures are being undertaken with a view to enhance the supply side of the economy. Among these measures, the lowering of the very high tax burden will provide better incentives to encourage people to work, consistent with the Broad Economic Policy Guidelines. The Council welcomes these structural measures and encourages the Swedish government to continue these initiatives with determination and especially continue to reduce the high tax burden."

EMU STATISTICS

The Council endorsed a third report on the updating of EMU statistics, prepared by the Economic and Financial Committee, in accordance with the relevant Action Plan of September 2000 which was established following a report of January 1999 of the Monetary Committee on information requirements in EMU. It was decided to make this report public.

The report covers the following areas: quarterly national accounts, quarterly public finance statistics, labour market statistics, short term statistics, external trade statistics and publication of statistical data. It also deals with balance of payments, service statistics, and structural performance indicators and the importance of consistency.

During the debate the Ministers noted the progress made with the development of statistics in the euro area although more work is required in this area along the lines set out in the Action Plan of September last year. In this context it was noted that discussions should be continued in certain Member States with respect to efficiency and the setting of priorities as well as the financial resources to be devoted to these tasks.

The Council welcomed the intention of the Commission to present it in the near future with a set of proposals concerning the adaptation of the existing regulations in conformity with the Action Plan. It will consider these proposals as a matter for rapid adoption.

LUNCH ITEMS

  • Taxation of savings

The President informed his colleagues that letters had been sent, this very day, to third countries - Switzerland, Liechtenstein, Monaco, Andorra and San Marino - by the Presidency and the Commission inviting these countries to start discussions with the Community on the taxation of savings, with a view, according to the Feira agreement, to promoting the adoption of equivalent measures in those countries (with respect to those foreseen for the Community in the Agreement on the substantive content of the Directive on the taxation of savings agreed at the 27 November 2000 ECOFIN). A letter with the same content will be sent in the next days to the incoming US administration in Washington.

The Presidency hopes to begin discussions on a technical level next month, starting if possible with Switzerland and the US.

It is recalled that Member States with dependent or associated territories had been asked already in December to provide the Presidency with an update on the current state of play concerning discussions with their territories.

  • EUROGROUP MEETING - debriefing by the Belgian Presidency

Minister REYNDERS informed his colleagues on the work of the Eurogroup meeting, which took place on Thursday evening, 18 January. These discussions covered, in addition to the usual exchange of views, on the economic, financial and monetary situation and outlook and the coordination of Members States' policies, the Belgian Presidency work programme for 2001 and the monthly monitoring report by the Commission on the "Preparation for the changeover to the euro".

    ANNEX

  • WORK PROGRAMME OF THE SWEDISH PRESIDENCY FOR THE ECOFIN COUNCIL

    Growth in Europe has strengthened, with good conditions for continued favourable economic development. Our main task is to ensure a stable and long-term sustainable economic development. This requires low inflation, low interest rates and strengthened public finances.

    Economic policy in the EU faces two major challenges. Firstly, unemployment levels are still too high and full employment has not been reached. Secondly, the sustainability of public finances needs to be secured. Changes in the age structure of the population affect the development of society in several areas. This applies to the labour market and growth, as well as to public finances and social welfare.

    The European Council in Lisbon set a new strategic goal for the European Union. This goal is to, within the next ten years, become the world's most competitive and dynamic knowledge-based economy capable of sustainable economic growth with more and better jobs, and greater social cohesion. At the European Council in Stockholm, the Lisbon strategy will be followed-up for the first time. The ECOFIN Council will play a central role in the preparations for the summit meeting.

    The Presidency Work Programme has been drawn up with the aim of contributing towards an efficient and ambitious follow-up of the Lisbon strategy and speeding up the work on the strategy. Two important issues are the consequences that the demographic development has on economic policy, and the creation of an integrated financial market in the EU. This will involve implementing the Financial Services Action Plan and striving to achieve a legislative process that is both faster and more efficient.

    Tax co-operation will be furthered to improve the functioning of the internal market, and emphasis will be placed on the fight against harmful tax competition.

    The Presidency will attach great importance to ensuring the efficient use of EU funds. This work will be based on a restrictive stance with regard to the EU budget. The trend towards restrictive budget levels and an improved budgetary process in recent years must be continued. Priority will be given to the work on establishing new and modernised rules governing the budgetary process, financial management and control of EU funds.

    We shall strive to achieve greater transparency in the work of the ECOFIN Council. More information shall be made easily available to the citizens of the European Union.

    Increased employment and improved co-ordination of economic policy

    Following the summits in Lisbon and Feira, the Broad Economic Policy Guidelines have been accorded even greater weight in the co-ordination of economic policy in the EU. Other council formations are given increased opportunity to take part in the process. The ECOFIN Council will prepare the European Council's guiding discussion at the Stockholm meeting.

    Employment is a top priority for the Presidency. The ECOFIN Council will play an important role in the preparations for the Stockholm meeting. In order to achieve the goal of full employment and to finance the costs of an ageing population, the supply of labour must increase in each member state. The Presidency will therefore strive to set an interim objective with respect to the overall goal of increasing the total rate of employment to 70 per cent, and to 60 per cent for women, by 2010.

    The percentage of elderly in Europe's population is rising rapidly, which increases the need for sustainable public finances. The report assessing the contribution of public finances to growth and employment will provide an important basis for discussion at the Stockholm meeting on the consequences of an ageing population. The ambition of the Presidency is to reach a common view on how to deal with the problems of an ageing population.

    The Stability and Growth Pact is fundamental for the credibility of economic policy. A thorough examination of the updated stability and convergence programmes will take place in the beginning of the year. The Presidency wishes to promote greater emphasis on the long-term sustainability of public finances.

    The success of the euro is vital to the EU. On 1 January 2002, notes and coins in euro will be put into circulation in those countries which have adopted the euro. The Presidency will promote the good functioning of the economic and monetary union and the successful introduction of notes and coins in euro. Early political agreement on the regulation on the protection of the euro against counterfeiting will be sought.

    Well-functioning markets for goods, services, capital and labour are vital to increased growth and employment. The work on economic reforms needs to be strengthened further. This will be done by consistently following up the recommendations set out in the broad economic policy guidelines and by using structural indicators. An increased focus on subject areas in the peer review of the economies of member states should be aimed at. It is particularly important to ensure the sustainability of the systems for financing pensions and health and medical care.

    A strategy for sustainable development is to be established by the European Council in Göteborg. The strategy will deal with economic, social and ecological sustainability. The ECOFIN Council has prepared a sector strategy aimed at the integration of environmental aspects in economic policy. This integration is to be based on market-related instruments such as taxes, user fees and trade in emission rights. The Presidency will strive to further the development of these instruments.

    Measures against harmful tax competition in order to improve the internal market

    The Feira summit established guidelines for accomplishing the work on the tax package. The agreement reached at the meeting of the ECOFIN Council on 26-27 November 2000 represented a new milestone and laid the foundation for future work in this area. The Presidency, together with the Commission, is now responsible for the task of initiating discussions with third countries on the taxation of savings. Corresponding discussions with dependent and associated territories will be conducted by the member states concerned. In parallel with this, discussions on the Code of Conduct for Business Taxation, concerning the standstill and rollback of harmful tax measures, will continue within the framework of the Code of Conduct Group.

    The Presidency will work to achieve an agreement for a directive on VAT and e-commerce. Work will also be undertaken on the new proposal for a directive on invoicing (including electronic invoicing) and on the proposal to amend the rules governing the right to deduct and refund.

    In the area of excise duty, the Presidency will resume the work on the energy tax directive. We also intend to initiate work on the proposals regarding tobacco duty that the Commission is expected to present in the spring.

    An integrated financial market in the EU

    The creation of an integrated European financial market is an important condition for strong growth and high employment. This is to be accomplished while maintaining financial stability and a high level of consumer protection. During the Swedish Presidency, work will be undertaken on a number of directives contained in the Financial Services Action Plan concerning issues such as money laundering, distance marketing of financial services, investment funds (UCITS) and market manipulation. The goal of an integrated financial market is to be achieved by 2005.

    In mid-February 2001, the Committee of Wise Men under the chairmanship of Alexandre Lamfalussy will submit its final report for consideration by the European Council in Stockholm. The Committee has been given a mandate to review the regulation of securities markets in the EU. Its main task is to identify weaknesses in the implementation of Community regulations, to assess whether the present regulatory structure is sufficient to deal with the structural changes currently taking place within the area, and to propose solutions. Based on the conclusions of the Committee, the Presidency will in particular aim at bringing about a reform of the regulatory system in the financial services area, with a focus on a faster and more efficient legislative process within the EU. Such a reform is essential in order to achieve the goal of an integrated financial market by 2005.

    Economic policy dialogue with the candidate countries

    The Presidency will give top priority to the coming enlargement of the EU. The ECOFIN Council can, within the framework of its mandate and fully respecting the existing format for the accession negotiations, promote enlargement. During the Swedish Presidency, an economic policy dialogue will be initiated with the candidate countries. The dialogue will comprise issues concerning macroeconomic and financial stability in the candidate countries. The ministers of finance and the governors of the central banks of the candidate countries will be invited to the informal ECOFIN meeting to be held in Malmö on 20-22 April 2001.

    The Presidency also plans to invite representatives from the candidate countries to a dialogue meeting at the state secretary level. At this meeting, we anticipate a discussion on the experiences from the first round of pre-accession economic programmes.

    Improved budgetary procedures and financial control

    The observations of the Court of Auditors constitute a valuable basis for assessing the use and control of EU funds. The Presidency will devote much effort to preparing the annual report of the Court of Auditors, on which the Council's recommendation on the discharge of the Commission for the implementation of the budget for 1999 is based.

    There is a need to improve conditions for the budgetary work done by the Council. The Presidency will therefore initiate a discussion at the ECOFIN Council in March on priority issues concerning the budget for 2002. Conducting a discussion on priorities at an early stage will allow the Council to contribute to an improved budgetary process.

    The Presidency will attach high importance to improving financial control. The proposal for a new financial regulation comprises an important part of the Commission's reform work. The Presidency will strive to enable a decision on the regulation to be taken as early as possible.

    Strengthened EU profile in international economic and financial issues

    The Presidency intends to strengthen the economic dialogue with Russia with the aim of contributing to Russia's integration in the European economic and social sphere. The reform programme of the Russian government will form an important basis for this dialogue. Another important aspect of the dialogue concerns what can be done to facilitate investment projects of mutual interest to the EU and Russia within the context of the Northern Dimension.

    Extensive financial needs in the Western Balkans, including Serbia, will require substantial and well-balanced contributions from the EU. At the same time, the budgetary scope is limited. We must strive to reach agreements for financing solutions that respect the financial perspective. Financial contributions from the EU are intended to support sound economic policy in the countries in the region and to complement initiatives from other actors.

    The Presidency shall strive for the EU to develop a clear and well-motivated common view on a number of priority matters related to the International Monetary Fund (IMF). A number of areas in which a common view would be desirable have been identified. They include the representation of the EU in the IMF, a possible review of the quota system and the role of the IMF in the international financial system.

    --------------------------------------

    ITEMS APPROVED WITHOUT DEBATE

    (Decisions for which statements for the Council minutes have been made available to the public are indicated by asterisks; the statements in question may be obtained from the Press Office.)

    ECOFIN

    Court of Auditors - Special report on the Commission's control of the reliability and comparability of the Member States' GNP data - conclusions

    The Council has taken note of the special report No 17/00 of the Court of Auditors on the Commission's controls of the reliability and the comparability of the Member States' GNP data and has adopted the following conclusions:

    "The Council acknowledges the importance of the accuracy of Member States GNP data for the calculation of the Community's own resources and decisions on structural actions and EMU.

    In this context the Council welcomes the important harmonization efforts made since 1989 by the Member States following the initiatives of the Commission and the GNP Committee acknowledged in the report of the Court of Auditors and stresses that these initiatives should continue.

    The Council takes note with satisfaction that the improvements made by Member States have resolved virtually all problems identified by the Commission. The Council welcomes the Commission intention to continue to monitor the progress achieved by the Member States and to examine the criteria to be established by the GNP Committee to ensure comparability, exhaustiveness and reliability of GNP data.

    The Council endorses the recommendations of the Court to the Commission to take measures to better explain the way it verifies GNP and to improve the transparency of this process.

    The Council considers that the application of the European System of Accounts "ESA 95" to the calculation of GNP from 2002 will further improve their comparability and reliability."

    TAXATION

    VAT - minimum standard rate*

    The Council adopted a directive amending the sixth directive on the common system of VAT with regard to the length of time during which the minimum standard rate is applied by Member States.

    The Directive, which maintains the current minimum standard rate at 15 %, aims to prevent a growing divergence in the standard rates of VAT applied by the Member States from leading to structural imbalances in the Community and distortions of competition in some sectors of activity, at least in the period in which a new VAT strategy is being implemented to simplify and modernise current Community legislation on VAT, as set out in the Commission Communication of 7 June 2000.

    In a statement for the Council minutes Member States undertake as far as can be foreseen today that from 1 January 2001 to 31 December 2005 they will make every effort to avoid widening the current span of 10 percentage points above the current lowest standard rate applied by Member States.

    Mutual assistance for the recovery of claims

    The Council reached a political agreement, subject to a requested Opinion from the European Parliament on the change of legal basis, on the text of a Directive on the mutual assistance for the recovery of claims. The Directive aims to broaden the scope, to include direct taxation, of an existing directive on mutual assistance for the recovery of claims resulting from operations forming part of the system of financing the European Agricultural Guidance and Guarantee Fund, and of agriculture levies and customs duties and in respect of value added tax and certain excise duties. There is also agreement that the Directive shall come into force on 30 June 2002.

    In line with the agreement reached, the amended Directive would apply to :

      (a) refunds, interventions and other measures forming part of the system of total or partial financing of the European Agricultural Guidance and Guarantee Fund, including sums to be collected in connection with these actions;

      (b) levies and other duties provided for under the common organisation of the market for the sugar sector;

    (c) import duties;

    (d) export duties;

    (e) value added tax;

    (f) excise duties on:

      manufactured tobacco,

      alcohol and alcoholic beverages,

      mineral oils;

    (g) taxes on income and capital;

    (h) taxes on insurance premiums;

      (i) interest, administrative penalties and fines, and costs incidental to the claims referred to in (a) to (h) above, with the exclusion of any sanction of a  criminal nature as determined by the laws in force in the Member State in which the requested authority is situated.

    The Council will adopt the text of the Directive after the European Parliament has given its Opinion on the legal basis.

    EXTERNAL RELATIONS

    Association with Latvia - State aid

    a) Implementing rules for State aid

      The Council signified its agreement to the EU-Latvia Association Council, adopting by means of the written procedure, a Decision adopting the implementing rules for the application of the provisions on State aid referred to in Article 64(1)(iii) and (2) pursuant to Article 64(3) of the Europe Agreement establishing an association between the European Communities and their Member States, of the one part, and the Republic of Latvia, of the other part.

    b) Extension for State aid

      The Council signified its agreement that the EU-Latvia Association Council should adopt by the written procedure a Decision extending by five years the period within which any public aid granted by Latvia will be assessed taking into account the fact that Latvia is to be regarded as an area identical to those areas of the Community described in Article 87(3)(a) of the Treaty establishing the European Community.

    Relations with the Associated CCEE - rules of origin

    The Council agreed that the relevant Association Councils should adopt by the written procedure the following Decisions concerning the definition of the concept of "originating products" and methods of administrative cooperation :

      - amending Protocol 4 to the Europe Agreement with Romania;

      - amending Protocol 4 to the Europe Agreement with Czech Republic,

      - amending Protocol 3 to the Europe Agreement with Latvia, and

      - amending Protocol 3 to the Europe Agreement with Lithuania.

    JUSTICE AND HOME AFFAIRS

    Agreement with Norway and Iceland on certain asylum procedures *

    The Council adopted a Decision concerning the signing of the Agreement between the European Community and the Republic of Iceland and the Kingdom of Norway concerning the criteria and mechanisms for establishing the State responsible for examining a request for asylum in a Member State or Iceland or Norway.

    The agreement negotiated by the Commission with Iceland and Norway basically reproduces the obligations and rights contained in the Dublin Convention (concerning the criteria and mechanisms for establishing the State responsible for examining a request for asylum) and the EURODAC regulation (concerning the comparison of fingerprints for the effective application for the Dublin Convention).

    CUSTOMS UNION

    EC-Turkey Association Council

    The Council adopted a Decision of the EC-Turkey Customs Cooperation Committee amending decision N°1/96 laying down detailed rules for the application of Decision N°1/95 of the EC-Turkey Association Council.

    The Decision N°1/96 is amended in respect of the conditions under which movement certificates A.TR are issued and the subsequent verification of A.TR certificates.

    As from 1 January 2001, Turkey will apply for the products covered by Decision N°1/95 the same customs duties in respect of third countries as the Community.

    INTERNAL MARKET

    Directive on food additives other than colours and sweeteners

    As a result of the approval of the single European Parliament amendment by the Council, the Directive amending Directive 95/2/EC on food additives other than colours and sweeteners is deemed to be adopted in the form of the common position so amended, in accordance with Article 251(3) of the EC Treaty.

    EMPLOYMENT AND SOCIAL POLICY

    Employment package 2000/2001

    Following political agreement reached on the employment package 2000/2001 at the Employment and Social Policy Council of 27/28 November 2000 and endorsement by the European Council in Nice in December, the Council formally adopted:

    • the Decision on Guidelines for Member States' employment policies for the year 2001,

    • the Recommendation on the implementation of Member States' employment policies.

    For details see Press release no 13862/00 Presse 454.

    EDUCATION

    Mobility Recommendation

    The Council, following the agreement reached at the Education Council of 9 November 2000, formally adopted a common position on the proposed Recommendation on mobility within the Community for students, persons undergoing training, volunteers and teachers and trainers. The common position will now be forwarded to the European Parliament for a second reading in accordance with the co-decision procedure. (For details on the contents of the Recommendation refer to Press release no 12928/00 Presse 420.)

    CONVENING OF THE CONCILIATION COMMITTEE

    The Council having not been able to approve all the amendments to the common positions adopted by the European Parliament, a conciliation committee is convened, in accordance with the provisions of the co-decision procedure of the Treaty (Art. 251), as far as the following legislative acts are concerned:

    • the proposed Directive on the assessment of the effects of certain plans and programmes on the environment ("SEA Directive");

    • the proposal for a Decision amending Decision No 1692/96/EC on Community guidelines for the trans-European transport network as regards seaports and inland ports;

    • the proposed Directive amending Directive 92/23/EEC relating to tyres for motor vehicles and their trailers and their fitting.

    TRANSPARENCY

    Public access to Council documents

    The Council approved the reply to the eleventh confirmatory application made by Mr Tony BUNYAN in 2000, the Danish, German and Spanish delegations voting against.

    APPOINTMENTS

    Economic and Social Committee

    The Council adopted two Decisions appointing

      - Mr Fernando MORALEDA QUILEZ as a member of the Economic and Social Committee in place of Ms Juana BORREGO IZQUIERDO for the remainder of her term of office, which runs until 20 September 2002.

      - Mr Mario MINOJA as a member of the Economic and Social Committee in place of Mr Flavio PASOTTI for the remainder of his term of office, which runs until 20 September 2002.

    Committee of the Regions

    The Council adopted two Decisions appointing

      - Mr Mark EDGELL as a member of the Committee of the Regions in place of Mr Keith BILLINGTON, for the remainder of his term of office, which runs until 25 January 2002.

      - Mr Jochen RIEBEL as a member of the Committee of the Regions in place of Mr Franz Josef JUNG for the remainder of his term of office, which runs until 25 January 2002.

    DECISION ADOPTED BY WRITTEN PROCEDURE

    EXTERNAL RELATIONS

    Relations with Turkey

    The Council, which had adopted its common position on the 30 June 2000 on the Regulation of the European Parliament and the Council concerning the implementation of actions aimed at the economic and social development of Turkey, approved on 28 December 2000 by written procedure, the amendments proposed by the European Parliament on this matter at it second reading in September 2000.

    ________________________

    (1) Communication from the Commission to the Council and the European Parliament : The contribution of public finances to growth and employment: Improving quality and sustainability.

    (2) OJ L209, 2.8.1997

    (3) Council Opinion of 31 January 2000 on the updated convergence programme of Sweden, 1999- 2002 (OJ C60, 2.3.2000).


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