Brussels calling, Belgian EU Presidency, Business Newsletter, 18/10/2010, Issue 5

8/8/2019 Brussels calling, Belgian EU Presidency, Business Newsletter, 18/10/2010, Issue 5

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Belgian EU Presidency Business Newsletter

Brussels calling

18/10/2010 Issue 5

High expectations for the Commissionsupcoming Single Market Act!

The euro crisis and critical public debt levels in most EU

member states have clearly shown the need for enhanced

economic cooperation within the EU, as recently stated by

former Internal Market CommissionerMario Monti during his visit to FEB. In

order to ensure Europes economic

future in a globalised world, a fully

integrated internal market is needed

more than ever. However, the huge

potential of the EU single market to

drive growth and create jobs still

remains underexploited.

Almost 20 years after the launch of the

internal market, enterprises and SMEs in particular are

still facing important obstacles to sell their products and

services across the EU. This is due, inter alia, to a lack of

harmonization or gold-plating by member states in several

areas, such as consumer protection legislation. Furthermo-

re, access to credit for innovation remains difficult and

European research and development programmes are bur-

densome and complicated. This undermines SMEs capaci-

ty to reap the benefits of the single market, not to speak

about the long awaited EU patent, which would finally

strengthen their innovation capacity.

In addition, our companies need a well functioning capital

market to raise funds for their investments. Unfortunately,

important barriers to free movement still exist. One of

these is the widespread double taxation of dividends in a

cross-border context. Last but not least, as services are the

engine of growth and employment in Europe, the imple-

mentation of the services directive should be speeded up.

In this respect, absolute priority should be given to the

establishment of interactive single points of contact.

The Monti Report is a first step in the right direction to

revitalize the single market. What the business communityneeds now, are concrete actions. Hence, its expectations

regarding the upcoming Single Market Act are very high.

Editorial

Brussels calling - 1 -

CONTENTS Editorial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Competitiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Events & meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-3

In the spotlight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

EU Asia relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

In the spotlight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Climate change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

EU China relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

EU South Korea relations . . . . . . . . . . . . . . . . . . . . . . . . . 13

Justice and Home Affairs . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Transport, Telecommunications and Energy . . . . . . . . . . 16

Links . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Team presentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Diane Struyven,Director of the European

Department of the FEB

Daily updated info on http://eupresidency.vbo-feb.be

Competitiveness Council (October 11-12, 2010)

On October 11-12, a Competitiveness Council took place inLuxembourg. The agenda was fully loaded with internal mar-

ket, industry and research topics. On October 11, the Coun-

cil discussed dossiers relating to the internal market under

the chairmanship of Vincent Van Quickenborne, Belgian

Minister of Economy and Administrative Simplification. On

October 12, discussions centred around industry items, withsessions chaired by Jean-Claude Marcourt, Walloon Minister

of Economy, and around research, with talks presided by

Benoit Cerexhe, Brussels Minister of Scientific Research.

Competitiveness


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A first internal market dossier on the agenda on October

11 was the Single Market Act (officially a Commission

communication called Single market deliverping smart,

sustainable and inclusive growth) which is supposed to

be made public by Internal Market Commissioner Michel

Barnier on October 27. After a Commission presentation

outlining the most important elements in the document,

the Council held a public debate on the functioning of

the internal market. The Single Market Act will contain

dozens of initiatives to complete the EU internal market

by addressing gaps and extending it to new areas, and is

partially based on the report by Mario Monti on the fu-

ture of the internal market which was published in May

2010. At the Competitiveness Council, the Belgian Pre-

sidency invited the member state delegations to express

their views on a number of specific points:

the follow-up of the Single Market Act, i.e. the

process and instruments to monitor implementation,with specific attention to the removal of identified

internal market failures;

citizens confidence in the internal market, by focu-

sing on the proper enforcement of internal market

rules, the raising ofawareness of the internal market

benefits and the removal of difficulties encountered by

citizens when dealing with internal market rules;

the external dimension of the internal market, i.e.

methods to assess and monitor the competitiveness of

the EU compared to third countries;

the coherence of EU policies related to the internalmarket;

a roadmap for the Single Market Act, to be implemen-

ted in close cooperation with the European Commis-

sion and the European Parliament.

Second, the Commission briefed

the Council on the situation of

retail services in the internal

market. On 5 July 2010, it pu-

blished a Retail Market Monitoring

Report which analyzes the func-

tioning of the entire retail chainfrom suppliers to consumers from

different perspectives and identi-

fies issues preventing the retail

sector from realizing its full poten-

tial. Earlier, the Commission also launched a consultation

to determine future policy priorities, and on October 27 it

will organize a conference where stakeholders can express

their views on the matter.

Third, views were exchanged on the highly contentious

dossier concerning translation arrangements for a future

EU patent system (about which the fourth edition of this

newsletter reported extensively in the Internal Market

section). A political agreement was still not reached in the

EVENTS&MEETINGS

18/10/2010 Eurogroup meeting Brussels

18/10/2010 Fifth newsletter Brussels calling

18-19/10/2010 Conference (organized with thesupport of the Belgian Presidency) Implementation of European

legislation on biodiversity at anational level

Brussels

18-19/10/2010 Conference (organized with thesupport of the Belgian Presidency) Anticipating and managing re-structuring in a socially responsibleway. New partnerships to preserveemployment.

Brussels

18-21/10/2010 Plenary session of the EuropeanParliament

Strasbourg

18-29/10/2010 Tenth meeting of the Conferenceof the Parties to the Conventionon Biological Diversity (COP 10)

Nagoya, Japan

19/10/2010 Economic and Financial AffairsCouncil

Luxembourg

20/10/2010 International roundtable (organi-zed with the support of theBelgian Presidency) The role ofscience in food policy

Brussels

20/10/2010 Conference (organized with thesupport of the Belgian Presidency) Employment and poverty:the role of social partners in thefight against poverty and socialexclusion

Brussels

21/10/2010 Conference (organized with thesupport of the Belgian Presidency) Belgian Competition Day

Brussels

21/10/2010 Employment, Social Policy, Healthand Consumer Affairs Council

Luxembourg

21/10/2010 Conference (organized with thesupport of the Belgian Presidency) Contributions from scientific re-search to the risk assessment ofGMO

Brussels

21-22/10/2010 Informal Foreign Affairs Council Development cooperation

Brussels

25/10/2010 General Affairs Council Luxembourg

25/10/2010 Foreign Affairs Council Luxembourg

25-26/10/2010 Agriculture and Fisheries Council Luxembourg

25-26/10/2010 Conference (organized with thesupport of the Belgian Presidency) Closing the salary gap, discus-sion of professional gender inequa-lities in the employment market

Brussels

27/10/2010 Conference (organized with thesupport of the Belgian Presidency) Green triangle of knowledge(eco-technologies) for sustainableco-development

Brussels

27/10/2010 Conference (organized with the

support of the Belgian Presidency) International SeminarTechnological Top Region

Diepenbeek


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Council. On July 1, 2010, the European Commission tabled

a proposal advocating three official languages (English,

German and French) for the EU patent application process.

If the patent is granted, only one language version either

English, German or French would be legally binding

throughout the EU. The Commissions proposal was inten-

ded to make patent protection in the EU more affordable,simplified and legally certain than in the current fragmen-

ted system. This would be a great stimulus to innovation

in Europe and could yield savings to business of up to 250

million EUR per year. In the current regime however, a

European patent granted by the European Patent Office

(EPO) in Mnchen must still be validated in each of the

designated member states. Often the latter require a trans-

lation of the European patent in one of their official lan-

guages, making patent protection in the EU a very cost-

ly and administratively cumbersome business. It was cal-

culated that in the current regime, the validation of apatent in all 27 EU member states costs up to 25 000 EUR.

As a result, many companies choose to register their

patent only in a limited number of member states which

fragments the internal market. Moreover, due to this

incomplete geographical patent protection in the EU,

countries where a particular patent is not registered often

become hubs for counterfeit goods which can then circu-

late freely within the internal market.

Despite its obvious advantages, some member states are

still opposed to the Commissions proposal, in particular

Italy and Spain. This is problematic as the draft regulationestablishing translation arrangements must be adopted by

the Council with unanimity. In essence, Italy and Spain

claim that the three-language proposal does not create a

level playing field between companies in different EU

member states. Instead they propose an English monolin-

gual system or the recognition of one of their own langua-

ges in the future EU patent system.

It should be noted however that

member states did agree on the

importance of an enhancedpatent system in Europe to

boost the competitiveness of

European innovative

industries. A very large majority

of member states, led by France

and Germany, supports the

Commissions three-language proposal. There was also

broad agreement that any compromise may not imply sig-

nificant costs due to translation requirements and may not

result in legal uncertainty. In a letter to Vincent Van

Quickenborne, BUSINESSEUROPE stated that it is now

time for EU member states to act and reach a final decision

on this long lasting issue, in order to reinforce Europes

position in the global knowledge economy.

In order to address the Italian and Spanish objections to the

Commissions proposal, the Belgian Presidency recently

made a number ofconcessions. These included the full

reimbursement of translation costs for

companies not filing their application in

one of the three official languages consi-

dered, and a transition period duringwhich only English would be recognized

as official language until machine transla-

tions to other languages would be of suf-

ficiently high quality. However, this com-

promise was considered insufficient by

the Italian and Spanish delegation.

Nevertheless, Vincent Van Quickenborne and Michel

Barnier pointed out that a compromise is still possible

within two red lines, namely lower costs and improved

legal certainty.

Despite current disagreements, the Belgian Presidency felt

sufficiently encouraged to continue negotiations based on

the existing Commissions proposal with a view to achieving

EVENTS&MEETINGS

28/10/2010 Tripartite Social Summit Brussels

28/10/2010 FEB lunch debate with Connie He-degaard, European Commissionerfor Climate Action

FEB premises,Ravensteinstraat4, Brussels

28-29/10/2010 European Council Brussels

28-29/10/2010 Conference (organized with thesupport of the Belgian Presidency) Active labour market policiesfor the EU 2020 strategy: ways to

move forward

Antwerp

3/11/2010 Conference (organized with thesupport of the Belgian Presidency) The EU patent ten years on:time is running out

Brussels

8-10/11/2010 Conference (organized with thesupport of the Belgian Presidency) Careers and mobility of resear-chers

Brussels

8-9/11/2010 Justice and Home Affairs Council Brussels

9-10/11/2010 Conference (organized with thesupport of the Belgian Presidency) Financing the mobility of

higher education students andresearchers

Mons

10/12/2010 EU-India Business Summit Egmont Palace,Brussels

27-29/10/2010 Conference (organized with thesupport of the Belgian Presidency) Reshaping Europe : addressingsocietal challenges through entre-preneurship and innovation

Lige

28/10/2010 Conference (organized with thesupport of the Belgian Presidency) Electronic commerce 10 yearsafter the directive of 8 June 2000

Brussels


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an agreement by the end of its mandate in December. The Presidency

therefore announced plans to organize another ministerial meeting in

November to pave the way for a compromise. It reaffirmed its commit-

ment to a final agreement combining cost effectiveness and legal cer-

tainty with a fundamental respect for the EUs linguistic wealth. If nego-

tiations fail again, a smaller group of at least nine member states could

decide to use the enhanced cooperation mechanism foreseen in theEU treaties.

Fourth, the Council took note of the provisional agreement which was

reached with the European Parliament on the draft directive for com-

bating late payments in commercial transactions (late payments

directive). More information on this breakthrough can be found in this

newsletter in the respective In the spotlight article.

Fifth, the Council approved without discussion a number of items, inter

alia a directive establishing simplified rules in prospectuses for securi-

ties, a directive strengthening capital requirements and imposing condi-tions in remuneration policies in the banking sector, a regulation establi-

shing measures to safeguard the security of gas supply, and a directive

aimed at reducing administrative formalities for ships entering or leaving

EU ports.

On October 12, the Council focused, in the presence of Antonio Tajani

(European Commissioner for Industry and Entrepreneurship) and Mire

Geoghegan-Quinn (European Commissioner for Research, Innovation

and Science), on the Commissions communication on the Europe

2020 flagship initiative Innovation Union. EU Industry Ministers held

a discussion on the current situation and the future evolution of finan-

cing conditions for innovative enterprises. EU Research Ministers

expressed their views on how EU research programmes could better

support innovation and on ways to turn member states into more active

drivers of innovation.

The Innovation Union initiative focuses Europes innovative efforts on

challenges such as climate change, energy, food security, health and an

ageing population. It intends to trigger private-sector investment

through public-sector stimuli, and aims to remove obstacles which cur-

rently prevent the commercialization of innovative ideas. These include

the lack of finance, fragmented research systems and markets, slow

standard-setting and the insufficient use of the public procurement le-ver. Key elements of the Commissions communication on an Innovation

Union include inter alia:

European Innovation Partnerships which intend to mobilize stake-

holders in research projects to tackle important societal challenges

such as healthy ageing, energy, smart cities and mobility, water effi-

ciency and non-energy raw materials;

an Innovation Union scoreboard with 25 indicators;

measures to improve access to finance, such as a cross-border ven-

ture capital regime and stronger cooperation with the European

Investment Bank;

the completion of the European Research Area (ERA), implying

the cutting of red tape, the removal of obstacles to researchers

mobility and more coherence between European and national

research policies;

Late payments directive

On October 5, the Internal Market and Consumer

Protection committee of the European Parliament en-

dorsed the deal struck with the Council on September

13 regarding the draft directive for combating late

payments in commercial transactions. The final vote

by the full European Parliament is likely to take place

during the plenary session in Strasbourg in the week

of October 18. The Competitiveness Council of Oc-

tober 11-12 took note of the provisional agreement

reached with the European Parliament on October 5.

The proposal for a new late payments directive up-

dates the existing late payments directive which en-

tered into force in 2000. The new legislation aims to

address more effectively companies financial problems

due to the late payment of bills. This is especially

problematic for small and medium enterprises

(SMEs) which often face severe liquidity constraints.

The most important change to the late payments le-

gislation is the imposition of deadlines for the pay-

ment of goods or services. For business-to-business

transactions, the general rule will be a 30-day dead-

line. However, contracting parties are allowed to fix a

deadline of 60 days if this is explicitly stated in the

contract and if it is not grossly unfair to the creditor.

An interpretation of the term grossly unfair is fore-

seen, but an objective application of the concept re-

mains difficult. For commercial transactions between

public institutions and business, the general rule is

also a 30-day deadline, which can under certain con-

ditions be extended to 60 days, but not more. An

exception to the general rule is foreseen for public

entities providing healthcare, to which member states

may grant a payment term of up to 60 days. The new

late payments directive also regulates the interest

rate which may be charged on overdue payments

(i.e. the reference interest rate plus at least 8%) and

the compensation for costs of recovery (minimum

40 EUR). Finally, the draft directive foresees a verifi-

cation period of 30 days for ascertaining that the pur-

chased goods or services comply with the contract

terms, with extensions possible under certain condi-

tions. However, such verification periods may not be

used to delay payment unnecessarily.

The new legislation aims to ensure transparency, avoid

loopholes and create a level playing field. Finding a

compromise has not been easy however due to the

question to what extent the term of payment aspect of

contractual freedom may be limited.

In the spotlight



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dedicated budgets for public procurement of innova-

tive products and services;

a legislative proposal to speed up and modernize stan-

dard-setting;

a modernized EU intellectual property regime, which es-

sentially implies the establishment of a cost-effective EU

patent.

The outcome of EU ministers discussion will serve as input

to the European Council in December which will be devoted

to research, development and innovation. The Belgian Presi-

dency already proposed draft Council conclusions on the

Innovation Union text.

A study ordered by the European

Commission pointed out that an

increase of the research and develop-

ment (R&D) share of EU gross domes-

tic product (GDP) to 3% could resultin up to 3,7 million extra jobs and a

GDP increase of up to 5,4% by 2025.

In the field of industry, the Council approved conclusions on

a new political framework for tourism in Europe. In its

conclusions, the Council states that actions in support of

tourism may inter alia be organized to stimulate its competi-

tiveness and promote its sustainability. However, the EU is

not allowed to harmonize national laws in the field of

tourism. Tourism is currently the third sector in the EU in

terms of employment and turnover (employing almost 10

million people in 1,8 million enterprises and generating over

5% of the EUs gross domestic product (GDP)).

In the field of research, EU ministers first of all adopted con-

clusions on the simplification of EU research programmes.

The conclusions underline that a better balance must be

found between sound management of funds, financial con-

trol mechanisms and trust in researchers and that a clearer

and rationalized European research and innovation landsca-

pe is required. The European Commission is invited to acce-

lerate the administrative procedures for the publication, vali-

dation, selection and granting of research projects and as

such shorten the time-to-grant. In addition, the Commis-

sion should already take some actions with regard to the

7th Framework Programme (FP7), inter alia the provision

of clear guidelines and further reduction of paperwork, the

improvement of the research participant portal, the improve-

ment of access to information on parti-

cipation and research call results, the in-

troduction of more flexibility in the com-

position and size of consortia and the

development of synergies with other EU

research programmes and instruments.

Second, the Council gave green light

for the launch of three so-called Joint

Programming Initiatives (JPIs) for

research, addressing three major societal challenges:

agriculture, food security and climate change;

cultural heritage and global change;

a healthy diet for a healthy life.

JPIs are a new EU research initiative which aims to ad-

dress common challenges which member states cannot

deal with alone, by bringing together researchers, existing

research evidence and national funding bodies and by sha-

ring tools, techniques and other resources more efficiently

among member states. The first JPI was launched in Decem-

ber 2009 and aims at combating neurodegenerative

diseases (e.g. Alzheimers).


Europe Asia Meeting (October 4-5, 2010) &Asia Europe Business Forum (October 4, 2010)

Europe Asia Meeting (political summit)On October 4-5, the 8th Asia Europe Meeting (ASEM 8

see boxed text) took place at the Royal Palace in Brussels.

The EU was represented by European Council President

Herman Van Rompuy (who chaired the meetings) and

European Commission President Jos Manuel Barroso.

Other excellencies included Naoto Kan (Prime Minister of

Japan), Wen Jiabao (Prime Minister of China), Lee Myung-

bak (President of South Korea), Nguyen Tan Dung (PrimeMinister of Vietnam), Abhisit Vejjajiva (Prime Minister of

Thailand), Julia Gillard (Prime Minister of Australia), Angela

Merkel (German Chancellor), Nicolas Sarkozy (President of

France), Jos Luis Zapatero (Prime Minister of Spain) andYves Leterme (Prime Minister of Belgium).

Several topics were on the agenda of ASEM 8. A first topic

was quality of life, i.e. how to ensure greater prosperity

and more dignity for all citizens the overarching theme of

this ASEM. A second important topic was sustainable de-

velopment. Third, views were exchanged on global securi-

ty dossiers. A fourth point for discussion were regional

matters.

At the end of the conference, two sets of ASEM conclusions

were adopted. A first set the Brussels Declaration onmore effective global economic governance specifically

deals with the economic and financial situation, which was

considered a priority number one by Asian and European

EU Asia relations


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leaders. A second set the Chairs Statement on grea-

ter wellbeing and more dignity for all citizens contains

shared points of view regarding various other dossiers.

In the first declaration on effective global economic gover-

nance, European and Asian political leaders agree to give

new momentum to the cooperation between the two con-

tinents with a view to inter alia the promotion of strong,

sustainable, balanced and inclusive growth, and the res-

toration of market confidence. They pledge to streng-

then the sources of growth, conduct structural reforms

and move away from excessive public deficits, non-sustai-

nable debts and development gaps. The measures taken

by European governments to ensure a proper functioning

of the sovereign debt market are welcomed. The G20 is

encouraged to make rapid progress with strengthening

the resilience and transparency of the financial system.

This includes stronger liquidity and capital adequacy rules

for financial institutions, the elimination of excessive leve-rage practices, more attention to moral hazard associated

with systemically important financial institutions, and

increased regulatory oversight over hedge funds, credit

rating agencies and over-the-counter derivatives. Leaders

also agree that the financial sector should bear a fair share

of the cost incurred by governments during the recent

financial crisis. With regard to the International Monetary

Fund (IMF), credibility and legitimacy need to be enhan-

ced through a quota reform to give emerging markets a

stronger voice in the governance of the institution. Con-

cerning developing countries, actions should be taken to

encourage more sustainable models of development,

which should combine market access and cross-border

investments, international assistance, debt initiatives and

technology transfers. Finally, European and Asian leaders

call for a successful conclusion of the Doha Develop-

ment Agenda in the framework of the World Trade Orga-

nization (WTO). Protectionism is rejected and adherence

to open markets is confirmed.

The second more general ASEM 8 declaration (Chairs

Statement) first of all addresses aspects of the three sus-

tainable develop-ment pillars, i.e.

economic develop-

ment, social cohesion

and environmental

protection. With

regard to economic

development, Asian

and European lea-

ders recognize the

importance of inter alia a balanced outcome of WTO nego-

tiations, innovation, the dissemination of clean technologies,intellectual property rights, the integration of financial mar-

kets, and information and communication technologies

(ICT). The relaunch of the ASEM Economic and Trade

Ministers meetings is also encouraged. Concerning environ-

mental measures, leaders state that these may not lead to

arbitrary or disguised restrictions on international trade.

With regard to social cohesion, it is agreed to promote

decent work, adhere to fundamental principles of theInternational Labour Organization (ILO) and to encourage

an effective dialogue between social partners to promote

mutual understanding on issues of productivity, working

conditions, remuneration and economic change. Partner-

ships with the private sector may facilitate the prepara-

tion of the workforce for future opportunities in strategic

sectors such as green industries, healthcare and elderly

care. Leaders also call for the sharing of experiences and

technical assistance in implementing social welfare policies.

Furthermore, the challenges related to overwhelmingly

young populations (e.g. access to basic education, child

labour) as well as rapidly ageing populations (e.g. pension

systems) are touched upon. Regarding environmental pro-

tection, leaders underline the legitimacy of the United Na-

ASEM is a forum for dialogue between Europe and Asia where

a large variety of topics is discussed. It was established in 1996 in

Bangkok, where the first ASEM summit was held. Currently there

are 48 members. These include all 27 EU member states, 16

Asian countries (including China, India, Japan and Indonesia), 2

international organizations (the European Commission and the

Secretariat of the Association of Southeast Asian Nations(ASEAN)), and 3 new member countries since this years ASEM

summit, i.e. Russia,

Australia and New

Zealand. As such,

ASEM covers virtu-

ally the whole of

the European and

Asian continents.

Together, the 48

ASEM partners re-

present roughly half of the worlds gross domestic product

(GDP), almost 60% of the worlds population and 60% of global

trade. ASEM does not replace Europes bilateral relations and

negotiations with Asian countries, but complements them.

Economic ties between the EU and the Asian ASEM countries

(including Russia, Australia and New Zealand) are increasingly

important. Between 2000 and 2008, goods trade nearly doubled.

In the first half of 2010, the EU ran a trade deficit with its Asian

partners of 129 billion EUR. China and Russia account for half of

Asian ASEM exports to the EU and almost two thirds of imports.

On the European side, Germany and France are responsible for

more than half of EU exports to Asian ASEM partners.

ASEM summits with heads of state or government take placeevery two years. ASEM also meets in other ministerial configu-

rations to discuss specific topics, such as finance, transport, edu-

cation or culture. The next summit with country leaders, ASEM 9,

is scheduled to take place in Vientiane (Laos) in October 2012.

Asia Europe Meeting (ASEM)


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tions Framework Convention on Climate Change (UNFCCC)

and express their shared willingness to urgently achieve a fair,

effective and comprehensive legally binding outcome. They

also recognize the principle of common but differentiated

responsibilities according to countries capabilities, and

that economic development and poverty eradication remain

overriding priorities for developing countries. The fast-start

financing commitments of developed countries to support

developing countries in their preparation for climate change

are welcomed. Furthermore, the declaration calls for the

development, transfer, deployment and dissemination of

affordable, safe and environmentally sound energy tech-

nologies, as well as the diversification of sources, routes and

types of energy supplies. The importance of sustainable for-

est and water resources management is stressed as well,

and both Asia and Europe urge the 10th meeting of the

Conference of the Parties to the Convention on Biological

Diversity (COP 10) in Nagoya (on October 18-29, 2010) toagree on an international regime for the restoration and

preservation of biodiversity. Finally, the declaration

expresses the rising interest of ASEM partners to develop

an international carbon market to raise the necessary funds

for the transition towards a green low-carbon economy.

Other points addressed in the more general ASEM 8 de-

claration include global issues, like sea piracy, terrorism

and transnational organized crime, disaster prevention and

relief, human security and human rights, nuclear non-proli-

feration and the reform of the United Nations (UN) system.

Regarding cooperation on sustainable development, lea-

ders confirm internationally agreed development goals,

including the Millennium Development Goals (MDGs), as

their guiding princi-

ples. The declaration

also includes state-

ments on regional

issues, namely Irans

nuclear program, the

recent Afghan elec-

tions, the renewed

Middle East peaceprocess, the political situation in Myanmar and the division

of the Korean peninsula. A last part of the declaration

deals with soft aspects of Europe-Asia relations, namely

people-to-people contacts and civil society interactions.

The political leaders take note of the conclusions of the

Asia Europe Business Forum (see below), which took

place on October 4.

In the margin of ASEM 8, several other important events

took place. First of all, on October 5, the launch offree

trade area (FTA) negotiations between the EU and

Malaysia was announced. The agreement is expected to

cover inter alia tariffs and non-tariff barriers, public pro-

curement, competition policy and sustainable develop-

ment. Second,Japan has expressed its wish to negotiate a

commercial agreement with the EU on the short term, fol-

lowing the signature of a deep FTA between the EU and

South Korea. Third, the EU and Vietnam signed a new

Partnership and Cooperation Agreement as a framework

for cooperation on various topics, such as business, trade,

investment, energy, education and training, poverty allevi-

ation and human rights. The two parties also agreed to

launch as soon as possible technical preparatory discus-

sions for a bilateral free trade agreement. Fourth, Euro-

pean Commission President Barroso had a discussion withthe Prime Minister ofThailand about ongoing negotiations

on a Partnership and Cooperation Agreement. Finally, the

EU and India discussed their plans for an FTA, just

before bilateral negotiations continued on October 6 in

New Delhi. Earlier, the EU and India announced their

intention to finalize negotiations by the end of 2010. The

negotiations are contentious due to the question of the

inclusion of social and environmental norms in the text.

Asia Europe Business Forum

Parallel to the political summit, the Federation of Enter-prises in Belgium (FEB) organized the 12th edition of the

Asia Europe Business Forum (AEBF), which took place in

the Egmont Palace in Brussels on October 4. The overar-

Ministerial conference on flexicurity

On October 4-5, the Belgian Presidency organized a ministeri-

al conference in collaboration with the European Commission,

under the title Flexicurity to the benefit of workers: makingtransitions pay. The conference took place in Ghent and was

presided by Jolle Milquet, Belgian Minister of Employmentand Equal Opportunities. European Commissioner for

Employment, Social Affairs and Inclusion Lszl Andor was also

present. Both of them underlined that flexicurity only makes

sense when its two aspects, flexibility and security, are proper-

ly balanced and lead to better jobs, upward mobility and ta-

lent development.

The conference mainly focused on the security aspect of flex-

icurity. Participants had in-depth discussions on the factorsthat contribute the most to the development ofhigh-qualityprofessional transitions. The latter include inter alia transi-tions from school onto the labour market and transitions within

the labour market. Views were exchanged on the issue of

school dropouts, the improvement of qualifications, trainingand life-long learning. The conference also addressed

increased worker vulnerability due to the multiplication ofso-called atypical labour contracts, which have led to a seg-mented labour market in some EU member states. Especiallywomen, youth and older people are affected by this.

Flexicurity has become a guiding principle for the EUs strate-

gy concerning employment. It could facilitate the transition

towards a green low-carbon economy. It should be noted how-

ever that the flexibility aspect of the concept is at least asimportant as the security aspect in this perspective.

In the spotlight


8/17


ching theme of AEBF was the financial services industry.

More than 180 high-level representatives from the finan-

cial and public sector in Europe and Asia, as well as from

industry at large, exchanged views on the opportunities

and challenges posed by the financial services industry

to both continents. More than 40 ASEM countries were

represented. Herman Daems, member of the Board of

Directors of FEB and President of BNP Paribas Fortis Bank,

chaired this AEBF edition.

The opening session in the

morning was attended by

inter alia His Royal Highness

Prince Filip of Belgium, Bel-

gian Foreign Affairs Minis-

ter Steven Vanackere, and

Lim Hwee Hua, Second

Minister of Finance in Sin-gapore. The importance of

the dialogue between Asia

and Europe in the fields of financial sector supervision and

the financing of the economy was stressed.

Then followed three plenary sessions: a first one on the

restoration of financial stability, a second one on an

integrated market for financial services, and a third one

on the growing role of Asia on the worlds financial

stage. The plenary sessions were followed by a keynote

speech by Dominique Cerutti, President and Deputy CEO

of NYSE Euronext. He emphasized that the traditional

financial centres in Europe and the United States (e.g.

London, New York) are still dominant, but that the latter

are gradually being joined by Asian centres, such as Hong

Kong, Singapore, and even Seoul, Beijing, Shanghai and

Shenzhen. He underlined that a sound regulatory frame-

work will be the key driver of competitiveness for financial

services centres in the future.

Next item on the programme were three paral-

lel breakout sessions, one on financing trade

between Europe and Asia, a second on therole of finance in reaching sustainable deve-

lopment, and a third on climate change chal-

lenges. One of the guest speakers in the latter

session was Jos Delbeke, Director-General at

the European Commissions Directorate-Ge-

neral Climate Action led by Commissioner

Connie Hedegaard. He stressed the need for a

comprehensive climate agreement in which the United

States and China should also find their place. The incor-

poration of all major emitters will stabilize carbon mar-

kets, Jos Delbeke said. He defended the EUs market-based approach the EU Emissions Trading Scheme (EU

ETS) which currently already has a turnover of around

100 billion EUR per year. He also stated the open charac-

ter of the EU ETS, which can be linked to emission-redu-

cing projects abroad through the Clean Development

Mechanism (CDM). It is our mission to create a global

carbon market out of the EU ETS, Jos Delbeke said.

Several countries around the world are currently in the

process of setting up similar cap-and-trade systems which

put a price on carbon and aim to gradually reduce green-

house gas emissions. Finally, Jos Delbeke emphasized the

importance of market-based instruments to raise the ne-

cessary money to fight climate change. Government

money alone will not be sufficient for that, he stressed.

At the end of the day, AEBF chairman Herman Daems pre-

sented the conclusions of the business summit. In their

joint statement, European and Asian business leaders first

of all call for caution and a determination to act sensibly.

An increased interdependency makes uncoordinated uni-

lateral communications and actions counterproductive andpotentially detrimental to all, the statement reads. The

conclusions consist of two parts: a first part with financial

recommendations and a second part with general recom-

mendations for the promotion of a business-friendly

environment.

The financial recommendations include first of all the res-

toration of financial stability, mainly through an interna-

tionally consistent regulatory and supervisory framework

which avoids overregulation, contains the risk of regulatory

arbitrage and creates a level playing field. In this perspec-

tive, the importance ofsustainable public finances were

also stressed. Second, an integrated market for financial

services, complemented by regional financial integration,

is called upon. Third, participants to AEBF agree that the

financial services industry should in the first place serve

the needs of a changing world. Support to SMEs and

micro-enterprises as well as a contribution to sustainable

development and

the fight against

climate change are

very important in

this respect.

The general re-

commendations for

the promotion of a

business-friendly

environment in-

clude, first and

foremost, a reference to the importance of a balanced

and ambitious conclusion of the Doha Development

Agenda in the framework of the WTO. The multilateral

process can be complemented by bilateral and regionaltrade agreements. A second important point concerns

intellectual property (IP) protection. ASEM leaders are

encouraged to establish and maintain a strong and cost-

HRH Prince Filip & Thomas Leysen(FEB)

[email protected]


9/17


United Nations Climate Change Conference sessions of the Ad-Hoc Working Groups(October 4-9, 2010)

In the run-up to the United Nations (UN) Climate Conferen-

ce to be held in the Mexican city of Cancn from November

29 to December 10, a last formal negotiation session took

place in Tianjin, China from October 4 to 9. As to prepare

a global climate agreement for the period post 2012, UNclimate negotiations were launched at the end of 2007.

Until now, the talks did not yield any notable

results however.

Nonetheless, Christina Figueres, Secretary-

General of the United Nations Framework Con-

vention on Climate Change (UNFCCC), said the

Tianjin meeting produced some concrete results.

More specifically, negotiators have produced a

draft text in which they identify what is

doable in Cancn and what will be left after-wards. The text, which will be submitted to the

Cancn conference, includes key operational ele-

ments such as finance, technology, capacity

building and the future of the Kyoto Protocol.

Notwithstanding the fact that negotiators could not come

to an agreement on the allocation of the 30 billion USD

fast start fund, views on a new fund of long-term finance

to cope with change have converged significantly. As a re-

sult, Christina Figueres expressed confidence that the issue

will be resolved in Cancn.

European Commissioner for Climate Action, Connie

Hedegaard, was less enthusiastic however. She said that the

progress made was very patchy and much too slow .

Mrs. Hedegaard especially criticized the lack of progress

made in translating key elements of the Copenhagen

Accord into UN texts. In addition, the Commissioner stated

that signs of backtracking on the Copenhagen Accord

by certain parties are an extra cause for concern about the

balance of the Cancn package.

Nonetheless, Connie Hedegaard expressed her belief that a

satisfactory outcome can still be reached in Cancn. The

Commissioner said that the Tianjin

meeting resulted in a convergence

of views and that next months cli-

mate conference must result in a

balanced package of decisions that

takes global climate action forward.

She also said that the content of the

package is gradually becoming

clearer, especially in terms of criti-

cal issues such as climate change

finance, technology cooperation,reducing tropical deforestation and

adaptation to climate change.

Furthermore Mrs. Hedegaard said

that the EU will do its utmost

through intensive bilateral and multilateral contacts with its

partners - including host country Mexico - to help ensure

that Cancn achieves the strong outcome that is needed to

keep the international fight against climate change on

track. She also mentioned that it is vital for the EU that the

decisions taken in Mexico capture the progress made so far

in the international climate negotiations. They should be

starting point for reaching an ambitious and legally binding

climate agreement as soon as possible.

Climate change

effective patent system and enhance enforcement of

patent rights. Also in the field of IP, counterfeiting

remains an impor-

tant issue. Third,

cooperation

between Asia and

Europe is requiredin the field ofener-

gy (in view of

increasing energy

efficiency and deve-

loping alternative

energy technologies), commodities (in view of commodity

substitution and cleaner technologies) and climate

change. With regard to the latter, it is stressed that the

private sector could do more if provided with clarity, pre-

dictability, flexibility, and a fair level playing field achieved

through a global framework agreement. Fourth, ASEM

governments are encouraged to adopt ambitious and

compatible information and communication technology

(ICT) policies in favour of increased market access. Finally,the AEBF conclusions underline the need to strengthen

interregional cooperation between SMEs.

The AEBF conclusions were submitted to the ASEM politi-

cal leaders which took note of them during a lunch debate

on October 5. The next ASEM business summit is expec-

ted to take place in 2012.

Asia Europe Business Forum

[email protected]


10/17


EU China Summits (October 6, 2010)

EU-China political summitOn October 6, a high-level political summit between the EUand China took place in Brussels. China was represented by

its Prime Minister Wen Jiabao, whereas European Council

President Herman Van Rompuy and European Commission

President Jos Manuel Barroso were present on behalf of

the EU. The politicians ex-

changed views on various

topics.

A first point on the agenda

concerned trade and in-

vestment. The EU stressed

the importance of improved

market access, a better

investment climate, more

effective enforcement of intellectual property (IP) rights and

the opening up of the Chinese public procurement market.

Trade barriers on both sides must be reduced or removed.

In addition, China is often criticized by Europe for not step-

ping up enough against technology theft, counterfeiting

and dumping practices. On the other hand, during the

political summit, Wen Jiabao urged the EU to recognize

China as a market economy. Such recognition would makethe country less vulnerable to anti-dumping charges under

the rules of the World Trade Organization (WTO).

Second, with regard to the global economic situation, the

EU representatives underlined the need to reduce global

imbalances. This does not only require struc-

tural reforms in Europe and China, but also

an appropriate exchange rate between the

yuan and the euro. Europe, as well as the

United States, have been accusing China of

keeping the value of its currency vis--vis

their currencies artificially low, as such un-

dermining European (and American) compe-

titiveness, economic growth and job creation.

During a meeting between Wen Jiabao on

the one hand, and Olli Rehn (European

Commissioner of Economic and Monetary Affairs), Jean-

Claude Trichet (European Central Bank President) and

Jean-Claude Juncker (Eurogroup President) on the other

hand, the euro zone chiefs stressed once more that

Chinese structural reforms should go hand in hand with an

orderly and broad-based appreciation of the Chinese

currency. Letting the adjustment fall entirely on Europewould be unfair and could undermine European economic

recovery. In June 2010, China did announce its intention to

reform its exchange rate regime and make yuan exchange

rates more flexible, but it was not exactly what we had

hoped for, Jean-Claude Trichet commented. Also

European Commissioner for Trade Karel De Gucht had

said earlier that there is a real problem with the value of

the Chinese currency. On October 4, at the beginning of

the Asia Europe Meeting (ASEM) in Brussels,Wen Jiabao

said that China intends to keep the relative value of

major reserved currencies stable. France, which will take

over the presidency of the G20 from South Korea in

November, intends to put the future of the global curren-

cy order on top of the G20 agenda. In 2009, the EUs

trade deficit with China amounted to 133 billion EUR. In

the first half of 2010, China was the EUs second most

important trading partner after the United States.

A third topic dealt with was global economic cooperation

and governance. Beijing has been asking for a reform of

the International Monetary Fund (IMF). The EU supported

Chinas call for a better representation of emerging econo-

mies in general and a shift of quota shares from overre-

presented to underrepresented countries to improve IMF

governance. However, The Commission and Council Presi-

dents underlined that enhanced representation should go

hand in hand with enhanced responsibilities in global

governance. The matter is expected to be addressed

during the G20 Summit in Seoul in November 2010. Theimportance of the G20 as a new forum for economic policy

coordination was also acknowledged.

Finally, the EU repeated its position with regard to the rule

of law and the respect for human rights in China. A

number of dossiers which

concern global security (e.g.

Afghanistan, piracy in the

Gulf of Aden) were also

discussed.

Prior to the EU-China politi-

cal summit, on September

30, BUSINESSEUROPE had

sent a letter to European

Council President Van Rom-

puy and European Commission President Barroso in which

the organization expressed its hope that the summit would

enable the EU to advance its economic relationship with

China based on the principles of reciprocity and global

responsibility. The letter stated that business leaders are

increasingly concerned about the deteriorating business

climate for foreign companies in China, due to Chinesepolicy initiatives such as the national indigenous innova-

tion policy, compulsory certification and licenses, state-

directed technology transfer and discriminatory pro-

EU China relations


11/17

Brussels calling

curement policies. BUSINESSEUROPE urged the two

Presidents to raise the following issues with priority:

Chinas revised offer to join the Government

Procurement Agreement of the WTO, which is consi-

dered insufficient;

the negotiation of a bilateral investment agreement withChina, which has not opened up its market for foreign

investments as much as the EU;

Chinas decision to reduce export quotas for rare earth

elements, which might result in strong price increases

and delivery shortages;

Chinas role in achieving an ambitious global agreement

to cut emissions and in facilitating private-sector coope-

ration on clean and energy-efficient technologies;

the sustainability of Chinese macroeconomic and

exchange rate policies.

The above issues were also dealt with extensively during the

EU-China Business Summit which took place on the same

day (see below).

EU-China Business SummitJust before the political EU-China summit, the Federation of

Enterprises in Belgium (FEB), the China Council for Promo-

tion of International Trade (CCPIT) and BUSINESSEUROPE

organized the 6th edition of the EU-China Business Summit

in the Egmont Palace in Brussels. The main theme this time

was innovation as a win-win solution for steady growth.

More than 500 participants,

both from the European and

Chinese public and private

sector, were present.

In the morning, four sessions

with high-level speakers on

various topics took place.

During a first session, parti-

cipants exchanged views on

how innovation can contri-

bute to the efficient use ofresources, and how coopera-

tion in research and development (R&D) can help in find-

ing new recycling applications and closing the material

loop. A second session dealt with the role ofinformation

and communication technology (ICT) in transport and

logistics. ICT-enhanced traffic management has the poten-

tial to make traffic flows significantly more efficient and to

reduce their environmental impact. In a third session, a

panel discussed the global race for talent. They talked

about which kinds of talents are needed nowadays to

strengthen innovative capacity in the future, and about the

requirements for educational systems to accommodate the

development of these talents. A fourth session dealt with

innovation in health and pharmaceuticals.

The highlight of the EU-China Business Summit was sche-

duled for the afternoon. After a presentation by consultancy

firm McKinsey & Company on what it takes to become

innovation champions in the 21st century, a political lea-

ders plenary ses-

sion took place.High-level speak-

ers in this session

wereWen Jiabao

(Chinese Prime

Minister), Herman

Van Rompuy

(European Council

President),Jos

Manuel Barroso (European Commission President) and

Yves Leterme (Belgian Prime Minister). In his opening

address, the Belgian Prime Minister underlined that Europe

and China share a firm belief in enterprise and trade as

well as the conviction that prosperity can be achieved

through excellence, hard work and innovation.

Yves Letermes introduction was followed by a speech by

European Commission President Barroso. He said that the

common worldwide challenges which Europe and China

face, imply huge commercial opportunities, but to make

mutually beneficial cooperation work, openness is required.

The European Unions economy is very open and we wel-

come more Chinese investment. At the same time there is

a general feeling that economic opennessin China could be greatly enhanced,

Barroso said. He underlined however that

European business people are not asking for

preferential treatment, but for a level playing

field with clarity, stability and predictability.

The Commission President touched upon a

number of European concerns regarding eco-

nomic ties with China, namely restrictions on

access to rare earths (i.e. a number of chemi-

cal elements which are mostly used in high-

technology products), Chinas IndigenousInnovation Product Accreditation Programme

(which favours Chinese-grown technology over foreign inno-

vation, e.g. in government tenders) and the enforcement of

IP rights. He reiterated Europes demand to let the

Chinese currency appreciate against the euro so that the

European economy recovery would not be hampered.

After President Barrosos speech, Chinese Prime Minister

Wen Jiabao took the floor. He left aside his prepared

speech on paper and decided to speak about issues which

currently concern European business leaders in order to

overcome misconceptions. Wen Jiabao offered three possi-

ble explanations of the general feeling that business con-

ditions in China have been deteriorating lately: Chinas

- 11 -

Jos Manuel Barroso

GatanMiclotte

[email protected]


12/17

Brussels calling

exchange rate policy, the Chinese investment climate and

the protection of IP rights in China.

With regard to Chinas management of yuan exchange

rates, the Chinese Prime Minister repeatedly urged EU

leaders not to put pressure on his country to let its cur-

rency appreciate. Doing so, he warned, might imply

the closure of many Chinese export-oriented firms which

could lead to social unrest in China. This would be a di-

saster for the world, he added. He also put

Chinese trade surpluses into perspective by

stating that the EU-China trade structure,

rather than an undervalued currency, lies at

the basis of the latter. He said that China

currently runs trade deficits with Japan,

Korea and ASEAN (Association of Southeast

Asian Nations) member countries. Wen

Jiabao emphasized that it is Chinas objec-tive to have balanced and sustainable

trade relations with the rest of the world.

Concerning Chinas investment climate and IP

rights, the Chinese Prime Minister assured the audience

that China would continue reforms to further open up its

markets. He claimed that foreign companies active in China

enjoy the same treatment as Chinese companies. Products

of your companies in China are Chinese products, he said.

We will protect your intellectual property.

Wen Jiabao also talked about a number of other topics.

With regard to the recent euro debt crisis, he said that

Europe is a strategic partner of China and that China

would not stand aside but take the necessary action in

case of future problems. He said that in recent months,

China purchased government bonds

from Greece, Iceland, Spain, Por tu-

gal and Italy. During a visit to

Greece on Octo ber 2, Wen Jiabao

offered to buy Greek debt in the fu-

ture to support a stable euro, show-

ing his willingness to work withthe EU to confront the financial

crisis. Concerning resources, Wen

Jiabao claimed that China would not

close its market for rare earth ele-

ments. A large share of the worlds reserves of rare earth

elements are located in China and recently there have

been indications that the country intends to lower its

export quota drastically for some of these elements. Ho w-

ever, Wen Jiabao stated that the country only has the sus-

tainable exploitation of these resources in mind. In this

respect, he condemned the ambiguous attitude of some

countries which on the one hand urge China to accelerate

extraction of rare earth elements and coal, and on the

other hand reprimand the country for the pollution it

causes. Wen Jiabao emphasized that it is Chinas objective

to make growth sustainable.

Finally, European Council President Van Rompuy took

the floor. He touched upon the conditions which Europe

and China need to fulfil in order to ensure steady econo-

mic growth in the coming years, notably innovation, the

promotion of the exchange of talents, a global level pla-

ying field characterized by undistorted competition and

strong economic cooperation in the frame-

work of the G20. For China, this implies

inter alia appropriate exchange rates and

the continuation of reforms. He concluded

by saying that Europes pillars for growth,

i.e. economic development, social cohesion

and environmental protection, are increa-

singly becoming Chinas pillars of growth

as well.

Finally, after the political leaders plenary

session, a business leaders plenary session

took place. On the European side, the panel

included among other participants Rudi Thomaes, CEO of

the FEB, and Philippe De Buck, Director General of BUSI-

NESSEUROPE. Rudi Thomaes mentioned a number of

challenges in EU-China business relations, such as stan-

dardisation, IP rights and a level playing field in market

access. At the end of the session, Philippe De Buck pre-

sented thejoint business declaration of the 6th EU-

China Business Summit.

The declaration states that European and Chinese authori-

ties should remain vigilant and continue pursuing neces-

sary improvements of business conditions in order to

sustain the economic recovery. A

return to protectionist measures

would be damaging to both

Chinese and European economies.

In this perspective, China and the

EU should join forces to move

towards a successful conclusion ofthe Doha Round negotiations in

the framework of the WTO.

Business leaders also express their

hope that an acceptable agreement

on Chinas accession to the WTOs Government

Procurement Agreement can be found. In addition,

European and Chinese businesses call for bilateral and

multilateral cooperation in the fight against counterfeiting

and piracy. With regard to innovation and creativity, the

exchange of talents between Europe and China should

be promoted and university cooperation should be

enhanced in order to encourage capabilities in science,

technology and innovation. Concerning the investment cli-

mate, businesses from both sides call upon their leaders to

- 12 -

Wen Jiabao

[email protected]

e


13/17

Brussels calling

EU Republic of Korea Summit (October 6,2010)

On October 6, the 5th EU South Korea summit took place

in Brussels. The EU was represented by European Council

President Herman Van Rompuy and European Commission

President Jos Manuel Barroso. South Korea was represen-ted by its President Lee Myung-bak.

Highlight of the summit was the signing of the

free trade agreement (FTA) between the EU

and South Korea, which was authorized by the

Foreign Affairs Council on September 16. The

FTA is the most ambitious ever signed by the

EU, requiring the two parties to eliminate 98,7%

of duties (expressed in trade value) for both in-

dustry and agriculture over a period of 5 years.

The agreement also addresses non-tariff barriers, competi-

tion and state aid, intellectual property, public procure-

ment, customs and trade facilitation. A dispute settlement

mechanism is also provided for. It has been agreed on the

EU side that the provisional application of the agreement

will start in July 2011, provided that the European Parlia-

ment has given its consent and that a regulation imple-

menting a bilateral safeguard clause has entered into

force. The Parliament is scheduled to vote on the latter

clause during its plenary session on October 19. With re-

gard to the FTA, Herman Van Rompuy stated that it sends

a strong signal that trade liberalisation is a key element for

the recovery of the world economy. Jos Manuel Barrososaid that the agreement demonstrates our belief in open

markets. South Korea is the EUs eighth largest trading

partner, with goods trade between the EU and South Korea

being worth around 54 billion EUR in 2009.

During the summit on October 6, the political leaders also

decided to upgrade their relations to a strategic partner-

ship. In May 2010, a new Framework Agreement betweenthe EU and South Korea was signed. It provides a basis for

strengthened cooperation

on major political and glo-

bal issues such as climate

change and development

cooperation.

The European and South

Korean representatives also

exchanged views on global

issues, such as the global economic situation and climate

change, as well as regional issues, like the situation on the

Korean peninsula, in Pakistan and Afghanistan, and the

developments in wider East Asia. They stressed the impor-

tance of G20 actions in securing the global economic

recovery and strengthening financial regulation and supervi-

sion. They agreed on the importance of trade for the eco-

nomic recovery, which implies an urgent conclusion of the

Doha Round in the framework of the World Trade Organi-

zation (WTO). Finally, the EU and South Korea pledged to

keep pursuing a high level of ambition to tackle climate

change challenges, and stressed the importance ofmarket-

based mechanisms to realize emission reductions.

improve investment conditions and remove impediments

to cross-border investment. Finally, regarding climate

change, the importance of the Clean Development

Mechanism (CDM) as a key instrument to reduce global

greenhouse gas emissions is underlined. EU and China

should intensify their cooperation in the development of

clean and energy-efficient technologies.

The next EU-China Business Summit will take place in

China in 2011.

EU South Korea relations

- 13 -

Justice and Home Affairs Council (October7-8, 2010)

On October 7-8, the Justice and Home Affairs Council helda meeting in Luxembourg. Several topics where on the

agenda, among which a Commission presentation and sub-

sequent ministerial discussion on draft directives on the

conditions of entry and residence of third-country

nationals in the framework of intra-corporate transfers

and for the purposes of seasonal employment. On July

15, 2010, the European Commission issued proposals fortwo directives regulating entry and residence conditions of

non-EU citizens coming to the EU in the framework of an

intra-corporate transfer or for the purpose of seasonal

Justice and Home Affairs


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employment. With the proposals, the Commission intends

to guarantee equal treatment throughout the EU to

admitted workers.

The draft directive regarding intra-corporate transfers con-

cerns highly qualified people, inter alia managers, specialists

and graduate trainees. The proposal first of all establishes

EU-wide criteria for

the admission of

applicants to an EU

member state, i.e. a

valid work contract

proving employment

with the employer in

question of at least

12 months, an

assignment letter

specifying the duration and location of the transfer, a validtravel document and evidence of sickness insurance. An

accelerated application procedure is foreseen, suggesting

that a decision must be taken within 30 days. If the out-

come is positive, the intra-corporate transferee would

receive a combined work and residence permit valid for a

specific period of time (1 to 3 years depending on the func-

tion of the concerned individual). Rejections would be open

to legal challenge. Furthermore, the draft directive stipu-

lates that admitted transferees must receive equal treat-

ment as compared to nationals in areas such as workers

representation, payment of statutory pensions and access

to public goods and services. The recognition of diplomas,

certificates and other professional qualifications is also pro-

vided for. To increase the attractiveness of EU member

states to intra-corporate transferees, a provision is included

regarding the treatment of family members and intra-EU

mobility. Finally, the proposal establishes the grounds for

refusal, withdrawal and non-renewal of permits and sets out

procedures to be followed when an application is received.

Simplified procedures would be possible under certain con-

ditions. Member states would however retain the right to

decide how many intra-corporate transferees they want

to admit to their respective territories.

The draft directive concerning seasonal workers regulates

for a large part the same issues as those addressed in the

directive on intra-corporate transferees, i.e. conditions of

entry and residence, seasonal workers rights, procedures to

be followed when an application is received, grounds for

refusal, withdrawal and non-renewal, the term within which

a decision must be rendered and the possibility of legal

challenge. Permitted individuals would receive a seasonal

worker permit, which would be valid only for the host

member state and for a maximum of six months. However,

a multi-seasonal worker permit is also foreseen, which

implies the issue of up to three permits covering up to

three subsequent seasons within one administrative act.

Again, member states would retain the right to decide howmany intra-corporate transferees they want to admit to their

respective territories.

During the Council discussion on the two draft directives,

EU ministers pointed out that the impact of the proposals

on national labour markets should be taken into account.

Some delegations asked for more flexibility, e.g. with re-

gard to the proposed duration of stay and the terms within

which a decision must be given. Another point of discussion

was whether third-country seasonal workers should be gi-

ven long-term visas instead of temporary residence per-

mits. Regarding social security benefits, several member

states questioned the principle ofequal treatment. Finally,

some ministers raised their doubts on whether the seasonal

workers proposal was in line with the subsidiarity principle.

Finally, the Council adopted without discussion a regulation

on administrative cooperation and the combating of value-

added tax (VAT) fraud. The regulation creates Eurofisc, a

network of national officials to detect and combat new

cases of cross-border VAT fraud.

Environment Council (October 14, 2010)

On October 14, the first formal Environment Council under

the ongoing Belgian Presidency was held in Luxembourg.

Apart from the EU Environment Ministers, the meeting was

also attended by EU Environment Commissioner Janez Poto-

cnik, Health and Consumer Protection Commissioner John

Dalli and Climate Action Commissioner Connie Hedegaard.Main points on the agenda were the adoption of conclusions

with regard to the EU policy for the upcoming United Na-

tions (UN) conferences on biodiversity and climate change,

a discussion about genetically modified organisms (GMOs)

and a discussion on the options for moving beyond the

20% target for reducing greenhouse gas emissions.

With regard to the UN conference on biodiversity, which

will take place in the Japanese city of Nagoya from October

18 to 29, the Council agreed on the main EU negotiating

positions and it reconfirmed the blocs main target of halting and restoring insofar possible biodiversity and ecosystem

services by 2020. Concretely, the Council acknowledged that

the EU will not meet the 2010 global biodiversity targets,

Environment



15/17

and that the objectives of the Convention on

Biological Diversity (CBD, see boxed text)

cannot be achieved given the current level of

resources. Therefore, the EUs policy at the

Nagoya meeting will be to strive for an am-

bitious, widely implemented new CBD stra-

tegic plan for the period 2011-2020, and to

increase the amount of resources to achie-

ve the plans timely implementation. How-

ever, given the current economic situation,

Joke Schauvliege, Flemish Environment Mi-

nister and current president of the Environ-

ment Council, stated that Europe will not come up with new

money for other countries. Furthermore, the EU will pursue

the agreement of a protocol on access to genetic resour-

ces and benefit sharing. Finally, the EU will also plead for a

stronger relationship among the Rio Conventions (the

CBD, the United Nations Framework Convention on ClimateChange (UNFCCC) and the United Nations Convention to

Combat Desertification (UNCCD)) to reach their objectives.

As for the UN climate change conference, to be held from

November 29 till December 10 in Mexico, the Council ex-

pects the Cancn meeting to result in the adoption of a ba-

lanced set of decisions that will provide a solid basis for a

binding, international climate agreement. Furthermore, the

main discussion topic was possible the continuation of the

Kyoto Protocol. In a joint statement, Joke Schauvliege and

Connie Hedegaard stated that, provided that this would be

part of a global framework engaging all major economies,

the EU would be willing to consider a second commitment

period under the Kyoto Protocol. As set out in the Com-

missions March communication, the Council also agreed to

adopt a step-wise approach in its strategy to secure an

international, legally binding

climate agreement.

Regarding GMOs, the Com-

missions proposal to let

member states decide for

themselves whether or notto allow the cultivation of

GMOs on their territory

provided that they are no

threat to the environment or consumers health was at the

center of the discussion. Since opinions on their impact on

the environment, public health, a possible fragmentation of

the common agricultural policy and the functioning of the

internal market diverge greatly among member states, the

authorization for the use of GMOs is almost impossible to

receive. Since the participants opinions did not converge,

no majority could be found for the Commissions proposal

among the Environment Ministers. As a result, until further

progress is made, the right to decide over whether or not to

allow GMOs still lies with the Commission.

Finally, the Council analyzed the options to move beyond

20% greenhouse gas emission reduction and it assessed

the risk of carbon leakage. More specifically, the Council

took note of the Presidency report on the follow-up of the

communication about a move beyond the 20% reduction

target and the risk of carbon leakage. In this context, theCouncil invited the Commission to further examine options

for a move beyond 20% and to further analyze the im-

pact it would have on member states. It was also decided

that the roadmap for a safe and sustainable low-carbon

economy by 2050, which is expected to be published early

2011, should also outline a long-term, low-development

strategy to put the 2020 target into perspective. Concretely,

the roadmap should set out a trajectory for emission reduc-

tions with intermediate targets for 2030 and 2040. Looking

ahead to the spring 2011 European Council, participants

decided to again address the options to move beyond 20%

after the Cancn climate conference.

In the light of this discussion, BUSINESSEUROPE warned

the Council for the detrimental effects of a unilateral

move to a 30% reduction target. In a letter to Joke Schau-

vliege, BUSINESSEUROPE wrote that, in the

absence of an international, legally binding

agreement, this would be counter-productive

for European business.

In the margin of the above item, the Council

took note of the progress made by the EU withregard to achieving its greenhouse gas reduc-

tion objectives. The Commission concluded that

25 out of 27 member states would meet, and

even overshoot their Kyoto targets.

Finally, the Council was briefed on a Commission proposal

that aims for the phasing-out of subsidies for the closure of

uncompetitive coal mines.

In the margin of the Environment Council, a directive con-

cerning the refund of value added tax (VAT) to taxable per-

sons established in a member state other than the one of

refund was adopted as well. The directive allows the dead-

line for refund applications to be extended from September

30 2010 to March 2011.


The Convention on Biological Diversity was signed by 150 heads of govern-ment at the 1992 Earth Summit in Rio de Janeiro. It is dedicated to promo-ting sustainable development, equal access to genetic resources and benefitsharing (for example, to facilitate the development of pharmaceuticals fromplant species) and to prevent biodiversity loss from persisting.

Since the European Commission estimated the annual cost of loss of ecosys-tem services on roughly 50 billion EUR, and as OECD countries barely spend3 billion EUR on biodiversity protection, the issue has gradually been clim-bing up the political agenda. Therefore, the European Parliament recentlyurged the EU to play a leading role at the biodiversity conference.

Convention on Biological Diversity (CBD)


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Brussels calling

Transport, Telecommunications and Energy(TTE) Council (October 15, 2010)

On October 15, the Council met in its Transport confi-

guration in Luxembourg under the presidency of

Etienne Schouppe, Belgian State Secretary for Mobility.

EU Transport Ministers reached a political agreement

on the Commissions proposal for a new Eurovig-

nette directive

the most recent

accomplishment of

the Belgian

Presidency. Theinitial directive

entered into force

in 1999 and

allowed member

states to levy user

charges (i.e. time-based charges or distance-based

charges such as tolls) on heavy goods vehicles (above

3,5 tonnes) to cover the costs of maintaining, opera-

ting and replacing road infrastructures that are part of

the trans-European network. If member states decided

to introduce such charges, the directive obliged them to

ensure that they would not result in discrimination, and

prohibited that charges were used to recover so-called

external costs (e.g. related to noise or air pollution),

which should be borne by society at large. The directive

intended to preserve the smooth functioning of the

internal market by preventing any abusive

and discriminatory charging by member

states.

The new directive proposed by the Commis-

sion in July 2008, over which political agree-

ment has now been reached, allows for theinternalisation of external costs and as such

implements the polluter pays principle in the

legislation. Concretely, member states will be

allowed to calculate tolls based not only on

road infrastructure costs, but also the cost of

traffic-based air pollution and noise (so-called

external cost charges). Charges will be diffe-

rentiated: they will vary depending on the type

of vehicle, emissions, the distance travelled, the location

and the time of road use. The directive eventually does

not introduce a specific congestion charge, but gives

permission to member states to modulate the infrastruc-

ture charge to take road congestion at peak hours into

account. The field of application of the directive would

be extended from only trans-European network motor-

ways to all motorways in Europe. Interoperable elec-

tronic systems (which have to be in place by 2012) willcollect the charges, and distributed receipts will clearly

indicate the amount of the external cost charges so

hauliers can pass the cost to their clients. Finally, the

directive includes a provision which recommends mem-

ber states to earmark part of the revenues generated

by the external cost charge for projects in the trans-

port sector.

By giving clearer price signals and differentiating char-

ges, it is expected that road users will change and

adapt their travel behaviour by better planning theirtransport, e.g. driving less polluting vehicles or avoiding

the rush hour. This should lead to greener and more

efficient transport.

The European Parliament already completed its first

reading of the draft directive in March 2009. The

Council however needed more time to come to an

agreement. Contentious questions included the use of

the revenues raised by the external cost charges and

the introduction of a specific congestion charge. The

text will now move back to the European Parliament

for a vote.

The Transport Council also exchanged views on the

future of transport in the coming decade. The discus-

sion will serve as input for thewhite paper the

European Commission

will draft on transport

policy for the coming

decade which will be pub-

lished by early 2011.

Ministers first of all dis-

cussed what the generalpriorities and strategies

of the future EU transport

policy should be to ensure

sustainability and address

other challenges such as

climate change and other

environmental issues,

migration, scarcity of fossil

fuels and urbanisation. Second, they expressed their

views on what measures should be taken to foster the

role of new technologies in the transport sector.

Transport, Telecommunications and Energy

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Website of the Belgian Presidency of the Council of the European Unionhttp://www.eutrio.be

Website of the Belgian EU Presidency of the Federation of Enterprises in Belgium (FEB)

http://eupresidency.vbo-feb.be

LINKS

Presentation of the European Department of the FEB

Diane StruyvenDirector of the European Department of the FEB Permanent Delegate to BUSINESSEUROPE

Tel: +32 (0)2 515 08 [email protected]

Michael VoordeckersAdvisor at the European Department of the FEBTel: +32 (0)2 515 09 [email protected]

Arnaud ThysenDeputy Advisor at the European Department of the FEBTel: +32 (0)2 515 09 [email protected]

Michiel HumbletIntern at the European Department of the FEBTel: +32 (0)2 515 08 [email protected]

Pieter-Jan Van SteenkisteIntern at the European Department of the FEBTel: +32 (0)2 515 09 [email protected]

TEAM PRESENTATION

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Brussels calling, Belgian EU Presidency, Business Newsletter, 18/10/2010, Issue 5

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Transcript of Brussels calling, Belgian EU Presidency, Business Newsletter, 18/10/2010, Issue 5