Insights Brussels April 2014

INSIGHTS BRUSSELS April 2014

INSIGHTS BRUSSELS.April 2014.


SECTORAL POLICIES................................................................................................. 4

Agriculture And Fisheries ................................................................................................................. 4

The European Commission sets its guidelines for the implementation of the Common Agricultural Policy ................... 4

Defence and Security Policy ............................................................................................................... 4

Defence ministers discuss the consequences of the Ukrainian crisis ............................................................................ 4

Energy and Environment ................................................................................................................... 5

The European Commission presents new State Aid rules for the energy sector ................................................................. 5 Obama calls on EU to reduce Energy dependency on Russia ...................................................................................... 6 The European Parliament endorses nuclear safety rules .............................................................................................. 6

Financial Services .............................................................................................................................. 7

The European Parliament adopts payment services package....................................................................................... 7 Agreement reached to improve information on investment products ............................................................................. 7 The European Parliament adopts new rules on non-financial corporate reporting ........................................................ 8

Food and Beverage ............................................................................................................................. 8

Healthcare and Pharmaceuticals ...................................................................................................... 9

The European Commission launches a public consultation on mhealth ........................................................................ 9 The European Commission approves a Joint Procurement Agreement for vaccines and medicines ............................ 9

Information and Communication Technology ................................................................................ 10

The European Parliament voted on ‘connected continent package’ ............................................................................ 10 EU definitively adopts the directive for a common mobile charger .............................................................................. 11 The European Commission launched a network for “MOOC” ..................................................................................... 11

Transport ........................................................................................................................................... 11

The European Parliament regulates noise-related operating restrictions at EU airports ............................................. 11 The European Commission intends to regulate the use of civil drones ....................................................................... 12 The European Commission wants to improve road haulage ....................................................................................... 13


CROSS-SECTORAL POLICIES .................................................................................. 14

Competition ...................................................................................................................................... 14

MEPs and consumers association unsatisfied with Google’s proposition ................................................................... 14

Consumers ........................................................................................................................................ 15

Consumers summit on digital age and data protection ................................................................................................ 15 The EU Court of Justice rules against additional costs in payment instruments ......................................................................... 15

Intellectual Property Rights ............................................................................................................ 16

European Commission’s White Paper on copyright still expected in June .................................................................. 16

International Trade.......................................................................................................................... 16

Obama’s visit to Brussels relaunches enthusiasm on TTIP ......................................................................................... 16 Chinese President also push for a EU-China Free Trade Agreement...................................................................................... 17

Research and Development .............................................................................................................. 17

The European Parliament debates on research on embryonic stem cells ................................................................... 17

Taxation ........................................................................................................................................... 18

The European Council formally adopts savings taxation directive ............................................................................... 18 The European Commission launches two public consultations on tax issues ............................................................. 18


SECTORAL POLICIES

The European Commission sets its guidelines for the implementation of the Common Agricultural Policy

On 2 April, the European Commission

published a “Special declaration” on the way it

intends to implement the Common Agricultural

Policy (CAP) reform. Contrary to what has been

adopted last December, the declaration

essentially dilutes the measures which were

originally meant to oblige all farmers to set

aside 5% of their land for an “ecological focus

areas” (EFAs). In the coming months the

Commission will issue further interpretative

notes that will make the EFA requirements

easier to meet. The aim of this measure was to

stimulate biodiversity but many stakeholders

opposed the rule because it would reduce

farmer’s productive capacity.

On 14 April, by the 28 European Ministers of

Agriculture the guidelines were backed.

Farmer’s representatives and several MEPs

welcomed the changes while environmental

associations and the Greens strongly criticized

the Commission for this choice.

Defence and Security Policy

Defence ministers discuss the consequences of the Ukrainian crisis

On 15 April, the 28 European Defence Ministers

and the NATO Secretary General Anders Fogh

Rasmussen, met in Luxembourg to discuss the

recent developments related to the Russian

involvement in the Ukrainian crisis. According to

European Defence Ministers, the crisis could lead

to reinforce European defence policies and to

boost the four main research programmes of the

European Defence Agency: refuelling aircraft,

drones, secure communication satellites and

cybersecurity.

The need for more effective European defence

policies has also been stressed by the United

States President Barack Obama during his visit in

Brussels on 26 March. Obama expressed

concerns about the declining “trend lines” in

Agriculture And Fisheries


European defence spendings and reminded his

European partners that “freedom is not for free”.

Although political attention toward this issue is

high, progresses in cooperation are slow and the

overall strategy remains still vague. Observers

remark that there are no recent updates on the

operational roadmap for maritime security that the

European Council is expected to adopt next June.

June 2014: Adoption of an EU maritime Security

Strategy by the Council

Energy and Environment

The European Commission presents new State Aid rules for the energy sector

On 9 April, the European Commission adopted its

new guidelines on State A id for energy and the

environment, after several weeks of Member

States’ and stakeholders’ consultation.

The new guidelines reflect developments on the

increasingly competitive renewables market.

According to the Commission, the way

renewables are supported by public resources

has created distortions of competition within

Member States and between countries. Under the

new provisions, Member States will now have to

take into account three funding criteria to ensure

the grant of state aid to a company:

the expected impact on GHG reduction of the

project;

the ability to upgrade environmental standards;

the capacity to accelerate the use of clean

technologies in the market.

The guidelines recognize in particular two

important sectors eligible for state aid: cross-

border energy infrastructure and capacity

mechanisms meant to secure adequate

electricity generation.

The new guidelines induce also major changes

for renewable producers. From 1 January 2015,

they will have to sell their electricity directly on the

market, although they will be eligible for aid in the

form of premiums. The guidelines also introduce

gradual competitive procedures for the grant of

public aid to renewables projects with the view to

become mandatory from 2017.

Last, the new guidelines exempt until January

2018 high electricity-using industries to finance

support programmes for renewable energy. This

provision reflects intensive lobbying by Berlin and

Paris to safeguard the competitiveness of their

energy-intensive industries. The European

Parliament’s Green party, as well as

environmentalists considered this measure

disproportionate and think this will be eventually

detrimental to small consumers.

2015: electricity producers sell directly on the market

2017: deadline for mandatory competitive procedures

for the grant of public aid

2018: deadline for the partial exemptions of electricity-

using industries


Obama calls on EU to reduce Energy dependency on Russia

On 26 March in Brussels, the President of the

United States Barack Obama promised to

increase cooperation with the EU on energy

issues. The diplomatic crisis with Russia

highlighted the need for Europe to reduce its

dependency on Russian imports of energy.

Currently, the EU imports around 35% of its oil

and 32% of its gas from Russia. According to the

Visegrád Group (an alliance of four Central

European countries – Czech Republic, Hungary,

Poland and Slovakia), these figures are much

higher for Central and Eastern European

countries (on average 70% of their total gas

imports are provided by Russia).

While the talks on the Transatlantic Trade and

Investment Partnership are still ongoing, Europe

calls on the US to authorize more licenses for

export into the open market. On that point the EU

wants the US to increase its exports of Liquefied

Natural Gas (LNG). Currently, US law authorizes

targeted energy exports only to countries with

which the US have free trade agreements. During

his speech in Brussels, President Obama stated

in this regard that there are ways to “accelerate

the process of diversification”.

He also underlined that Europe should not only

rely on the US but also focus on the development

of indigenous sources. Referring to shale gas,

President Obama said that “every possible

energy source has inconveniences”. The US

have become an energy exporter thanks to

hydraulic fracturing technique over the past ten

years. Questioned on this issue by a German

journalist, EU Energy Commissioner Günther

Oettinger stated: “We have to consider the option

of fracking in order to replace Russian gas”.

The European Commission intends to present in

June a roadmap on European energy

Independence. Energy issues will also be at the

heart of the next round of TTIP negotiations that

will take place in June in Washington.

June: EU Roadmap on energy dependency

June: 5th round of TTIP negotiations

The European Parliament endorses nuclear safety rules

On 2 April, the European Parliament supported

the framework adopted by the European

Commission reviewing the directive on nuclear

safety. The Parliament, which has no co-decision

powers on nuclear issues by virtue of the Euratom

Treaty broadly lent its support through the

adoption of a Parliamentary resolution (438 votes

in favour, 154 against and 37 abstentions). The

new directive will make it mandatory for Member

States to undertake peer reviews of the safety of

their plants every six years.

Green MEPs and environmentalists criticized the

results of the vote, claiming that the adopted text

is “scarcely binding” and “will not give the

necessary competence to nuclear safety

authorities to stop operators from taking

unnecessary risks”.

End 2015: deadline for the transposition of the directive

into national law


Financial Services

The European Parliament adopts payment services package

On 3 April, the European Parliament adopted the

regulation on multilateral interchange fees (MIFs)

and the revised payments directive (PSD2).

On the MIFs regulation, substantial modifications

in the text were introduced during the vote in the

Economic and Monetary Affairs Committee

(ECON). MEP’s decided to include commercial

cards in the scope of the regulation while the so

called principle of “honour all cards” rule was

removed. This rule required merchants handling

one of a major card’s to accept all of the same

network’s cards. The new regulation aims to

introduce caps to fees that can be applied to debit

or credit cards. Fees cannot exceed 0,3% of the

amount of the transaction for credit cards while

debit card will have a ceiling of 0,2% or a

maximum of 0,07 Euros. Even though there is no

evidence that the cap would directly reduce costs

for consumers the European Consumers

Organization welcomed the vote.

The PSD2 directive remained similar to the

Commission’s proposal. The directive introduces

provisions prohibiting most card surcharges

(additional fee charged when purchasing),

decreasing consumers’ liability in fraud and

strengthening security.

Despite this vote, it is unlikely that an agreement

will be reached with the Council before the

upcoming elections.

Autumn 2014: start of negotiations with the Council

2015: possible final adoption of the directive

Agreement reached to improve information on investment products

On 15 April, the European Parliament confirmed

the agreement reached with the Council and the

Commission on a set of rules to enhance

consumer’s awareness when purchasing

packaged retail investment products (PRIPs).

The new regulation make it compulsory to

enclose a “Key Information Document” (KID) for

retail investment products. The aim of this

regulation is to provide small investors tools to

assess risks and costs related to an investment

product. Furthermore, on Parliament’s request,

new provisions have been included in the

package to oblige retailers to warn consumers

when buying a complex product. However, the

application of this measure will depend on

national supervision so that its implementation

may be not harmonised at EU level. MEPs did not

succeed in including pension products and

corporate bonds in the deal.

Consumer organizations welcomed the deal

stating that this would increase transparency in

transactions. The Council has now to formally

adopt the text.


A recent study published by the Commission

estimates that PRIPs market generated around

10 trillion Euros in 2012.

May-June: Formal Endorsement by the Council

The European Parliament adopts new rules on non-financial corporate reporting

On 15 April, the European Parliament sitting in

plenary session approved by a large majority a

directive on disclosure of non-financial

information. Companies considered of “public

interest” and having more than 500 employees

will have to publish information concerning their

social and environmental policies, as well as the

respect of human rights, anti-corruption and

bribery issues on their board of directors.

According to the Commission the new rules will

apply for around 6000 companies in Europe.

May-June: Formal endorsement by the Council

Fall 2014: Publication in the official journal of the EU

Food and Beverage

Agreement reached on new rules for the promotion of agri-food products

On 15 April, the European Parliament confirmed

the political agreement reached with the Council

and the Commission on a new programme for the

promotion of agri-food products within the internal

market and in third countries.

Under the provisions adopted, the Commission

will provide €883 million between 2014 and 2020

to co-finance promotion and information

campaigns on European agri-food products. The

EU aid can reach between 70% and 80% of the

cost of selected campaigns depending on

whether applicants are from a single European

country or from several Member States. The

Commission believes that each euro spent in this

programme would generate €35 in return.

All agricultural products and processed products

are eligible including beers, chocolate, bread,

pastry, pasta, salt or corn. The case of wines was

originally excluded from the Commission’s

proposal but MEPs supported its inclusion with a

protected designation of origin (PDO) or

protected geographical indication (PGI) for wines.

The Council has now to formally adopt the text.

May-June: Formal Endorsement by the Council

1st December 2015: The program starts to apply


Healthcare and Pharmaceuticals

The European Commission launches a public consultation on mhealth

On 10 April, the European Commission launched

a public consultation on existing barriers and

issues related to the use of mobile devices (such

as smartphones and tablets) in the context of

health prevention and care. Mhealth applications

already help patients in a large number of daily

situations such as measuring vital signals,

providing fitness and dietary recommendations or

reminding to take a given medication.

With a view to raise stakeholders’ awareness on

EU rules on data protection, medical devices and

consumer legislation, the Commission has also

released a preliminary review of the EU

legislation applicable to lifestyle and wellbeing

apps. The aim of the public consultation is to

collect informations in order to address issues

such as:

The safety of mHealth apps and concerns

over the use of data;

The lack of interoperability among available

solutions;

The lack of knowledge of the legal

requirements applicable to wellbeing apps

and the conditions under which they should

comply with data protection rules;

The “nature” of these apps in the healthcare

legal framework and the extent to which it

should be considered as medical devices

requiring the “CE” marking

The EU is also funding research on mHealth; and

according to the Commissioner for the Digital

Agenda Neelie Kroes €95 Million will be invested

to finance projects during the next two years.

The public consultation will run until 3 July.

3 July: deadline for the public consultation

Fall 2014: Publication of the responses

2015: Follow-up on Commission’s proposal

The European Commission approves a Joint Procurement Agreement for vaccines and medicines

On 10 April, the European Commission approved

a joint procurement agreement that will allow

Member States to purchase jointly pandemic

vaccines and other medical countermeasures. All

Member States except Germany already

declared their intention to sign the agreement.

The new mechanism is voluntary and does not

imply any financial commitment. Through the

Joint Procurement Agreement, any EU country

can make a proposal to others to procure

medicines together.


This decision reflects the lessons learned from

the H1N1 influenza pandemic in 2009 (popularly

known as ‘swine flu’). At the time, many Member

States had to buy large quantities of vaccines at

non-competitive prices in order to face a

pandemic warning issued by the World Health

Organization (WHO).

The agreement will enter into force two weeks

after being signed by a third of the participating

Member States and the Commission.

2014: Ratification by Member States

The European Parliament voted on ‘connected continent package’

On 3 April, the European Parliament set down its

position in plenary session on a single telecoms

market (the so-called “connected continent

package”) ahead of the opening of negotiations with

the Council of European Ministers.

On the flagship measure of roaming fees, Members

of the European Parliament voted in favour of

scraping roaming charges for mobile phones from

15 December 2015. This obligation would apply for

voice, text and data services. MEPs included

nevertheless an exemption: if consumers use

roaming services to excess, capped charges could

exceptionally be imposed.

On the sensitive issue of net neutrality, the

European Parliament supported amendments to

the initial proposal from the European Commission

to include the principle of net neutrality in the new

rules and to shorten the list of exemptions for

slowing down Internet access and services (limited

to the cases of court order enforcement, network

security or prevention of temporary network

congestion). Under the new provisions, internet

access providers would be banned from slowing

down or blocking particular services.

Supporters of the net neutrality, spearheaded by La

Quadrature du Net, Green and Socialists groups in

the European Parliament, as well as the European

Commissioner for digital agenda, Neelie Kroes,

warmly welcomed the outcomes of the vote. The

package was approved with a large majority (534

MEPs in favour, 25 against and 58 abstaining) on

first reading before and will be eventually adopted

by the next Parliament. The Council of Ministers will

adopt its position in the coming months prior to a

final agreement, expected between now and the

end of 2015.

Mid-2014: Council position on connected continent package

By End 2015: final adoption of the package expected

Information and Communication Technology


EU definitively adopts the directive for a common mobile charger

On 14 April, the Council of European Ministers

adopted the directive on harmonisation of rules

for placing on the internal market equipment that

use radio spectrum. The directive seeks to

prevent harmful interference from a whole set of

devices (mobiles phones, modems, digital keys

for cars). This directive also includes the famous

measures requiring mobile phone manufacturers

to produce and use a common charger

throughout the Union by 2017.

The European Parliament already endorsed an

agreement on 13 March. Member states will have

now two years to transpose the rules into their

national laws and manufacturers will have an

additional year to comply.

2016: deadline for the transposition into national law

2017: deadline for manufacturers to comply

The European Commission launched a network for “MOOC”

On 27 March, the European Commission

launched a network of providers of MOOCs

(Massive Open Online Courses) related to web

and apps skills. MOOCs are quality university

courses online available to all. The new network

aims to map the demand for web-related skills

across Europe and to promote the use of MOOCs

for capacity-building in those fields.

According to the European Commission, Web-

related industry is generating more economic

growth than any other part of the European

economy, but hundreds of thousands of jobs

remain unfilled due to the lack of qualified staff.

April: opening of the network for MOOC providers

Mid-2014: opening of the network for participants

Transport

The European Parliament regulates noise-related operating restrictions at EU airports

On 16 April, the European Parliament definitively

approved the agreement reached with the

Council of Ministers to grant a prominent role to

regional and national authorities in defining

restrictions for noise-related operations at EU

airports, whilst ensuring that people living nearby

should be better informed. The regulation also

addresses noise-related health problems.

Meanwhile EU members will continue to have the

final say in this field despite the major impact of

the upcoming European legislation.

This agreement concluded the legislative process

initiated by the European Commission in

December 2011 which originally aimed at

establishing new rules governing decision-


making process on aircraft noise bringing EU law

into line with international principles. These

legislative changes are likely to increase the

importance of grassroots lobbying strategies

implemented by the Aircraft industry, NGOs and

other interested parties.

May: publication in the EU official journal

2016: entry into force of the regulation

The European Commission intends to regulate the use of civil drones

On 8 April, the European Commission presented

a set of new standards to regulate the operations

of civil drones. The civil drone market is expected

to grow significantly with an estimated share of

10% of the aviation market in 2024 representing

€15 billion per year. National rules, however,

differ considerably from one Member State to

another and industry representatives are calling

for more legal certainty. In its communication, the

European Commission seeks to address in

particular the issues raised on safety, security,

privacy, data protection, insurance and liability:

On safety issues, the European Commission

called the European Aviation Safety Agency

(EASA) to examine the standards in order to

ensure that the use of drones guarantee an

equivalent level of safety to 'manned' aviation

operations;

On privacy issues, the European Commission

want data protection authorities to monitor the

subsequent collection and processing of

personal data. The Commission will assess

how to ensure data protection rules apply fully

to remotely piloted aircraft and propose

changes or specific guidance where it is

needed;

On security issues, the European Commission

wants that EASA proposes specific legal

obligations for all players concerned so that the

risk of drones being used for terrorist ends is

reduced;

On liability and insurance, the current third-

party insurance regime has been established

mostly in terms of manned aircraft, where mass

(starting from 500kg) determines the minimum

amount of insurance. The Commission will

assess the need to amend the current rules to

take into account the specificities of remotely

piloted aircraft.

With a view to address more formally these

issues, the European Commission will open in the

coming months a public consultation and

undertake an impact assessment analysis, in an

effort to formulate legislative proposals. All this

work aims to meet the stated objective of the

European Council of December 2013 to ensure

the progressive integration of drones into

airspace as from 2016.

May: EASA examines safety and security issues

Mid-2014: public consultation and impact assessment

2016: deadline for drones’ integration into airspace


The European Commission wants to improve road haulage

On 14 April, the European Commission published

a report calling for simplification and clarification

of EU rules on road haulage. The report in

particular calls for the Member States to step up

their efforts in enforcing existing legislation more

effectively and consistently; support the need to

better apply social rules in road transport if the

sector is to attract new drivers, and be able to

handle the expected future demand for freight

transport; and stress the opportunity given to the

EU to improve the efficiency of its economy and

reduce greenhouse gas emissions from transport.

The report concludes that while some progress

has been made, removing the remaining

restrictions would help the European economy

and improve the environment.

No legislative proposal is yet on the agenda to

open up this market further but the current

European Transport Commissioner Siim Kallas

will provide his successor with a set of options to

improve the functioning of the market.


CROSS-SECTORAL POLICIES

Competition

MEPs and consumers association unsatisfied with Google’s proposition

On 31 March, the European Consumers’ Bureau

(BEUC) presented an official complaint to the

European Commission stating that the

commitments offered by Google last February are

insufficient to solve its abuse of dominant

position.

The dispute started in 2007 when Google was

accused to manipulate its search algorithm to the

detriment of potential competitors. Last February,

the American internet giant made an offer. If

Commissioner for Competition Joaquin Almunia

was willing to accept the deal, complainants

companies worried that concessions made by

Google would not address the matters and could

quickly become obsolete considering the

evolution of the sector. Complainants request to

make Google’s algorithm more transparent or to

regulate search-engines.

Concerns were also raised by members of the

Committee for Economic and Financial Affairs

(ECON) of the European Parliament during a

hearing with Commissioner Almunia.

According to observers, at least nine

Commissioners are hostiles to the signature of

the agreement including Commissioner for

Internal Market Michel Barnier and Commissioner

for energy Gunther Oettinger. On the other hand

Commissioner Almunia would like to leave office

with the issue being solved. The matter is

extremely intricate, especially because if the

Commission accepts the commitments, those

would be binding for five years. In this case

Google would be immune from European anti-

trust law for a long period of time. A majority vote

in the College of commissioners is required for the

commitments to be accepted.

May-June: Commission’s expected final decision


Consumers

Consumers summit on digital age and data protection

On 1-2 April in Brussels, took place the European

Consumer Summit 2014, the event focused on

the topic of the digital economy. Even if the

completion of the digital single market will not

become effective in the near future, the summit

aimed to debate on how consumers can fully

benefit from this market. According to the

Commission, once completed, the digital single

market could benefit each European consumer

€400 per year. Representatives from National

governments and authorities, MEPs, but also

consumers and business organizations attended

the event hosted by Commissioners for

Consumers Policy (Neven Mimica) and the digital

agenda (Neelie Kroes). The summit focused on

the following issues:

How best consumers can benefit and contribute

to the digital economy;

How effective protection of online consumers

rights can be assured;

What skills modern consumers need (including

the most vulnerable ones) to interact with the

growing complexity of the digital landscape;

How to promote a more consumer-oriented

digital environment that could build up

consumers trust.

March/April 2015: European consumers summit 2015

The EU Court of Justice rules against additional costs in payment instruments

On 9 April, the European Court of Justice ruled

against an Austrian mobile service provider for an

infringement of the directive on payments. The

telecommunication company was opposing a

decision from the Austrian court to ban the €3 fee

that the service provider used to charge to users

who decided to pay their bills through online

banking or paper transfer.

The court concluded that the directive gives

Member States the right to limit or prohibit the

right of the payee to levy charges on the payer in

relation to a given payment instrument. This

power is certainly applicable in the framework of

a contract between a mobile phone service

provider and a consumer. According to the Court,

Members States may generally prohibit payees

from levying charges on the payer whatever the

payment instrument is in case the national

legislation takes into account the need to

encourage competition and the use of efficient

payment instruments.

The Austrian Supreme Court will now have to

determine whether the national legislation is

consistent with the above mentioned condition.

2014: Decision by the Austrian Supreme Court


Intellectual Property Rights

European Commission’s White Paper on copyright still expected in June

After the closing of the public consultation on the

review of the EU copyright rules in March, many

observers expressed their concerns at a possible

delay in the presentation of the White Paper on

copyright, due to the record number of responses

(11 000). The European Commission, however,

confirmed that the timetable for early June will be

respected, and will therefore put extra staff to the

analysis of the responses.

The White Paper will lay down the political and

legislative priorities for the next few years on

copyright in the age of Internet. Options for

financial compensation for creators and private

copy charges may also be included in the White

Paper.

Early June: presentation of the White Paper on copyright

International Trade

Obama’s visit to Brussels relaunches enthusiasm on TTIP On 26 March, the President of the United States

Barack Obama met in Brussels the President of

the European Council, Herman Van Rompuy and

the President of the European Commission, Jose

Manuel Barroso. During the press conference,

Obama stressed the point that the Transatlantic

Trade and Investment Partnership (TTIP) will not

weaken consumers or environmental protections.

Since the beginning of the negotiations last July,

public concerns have risen among Europe, in

particular on the view that the agreement would

lower the cost of regulation imposed to business

by setting lower environmental or health

standards.

Furthermore Obama underlined his personal

engagement to conclude the deal in a short delay.

He agreed with the EU’s top officials that the core

of the deal should be achieved before the end of

the year. Both sides recognized that the TTIP is a

“strategic tool” in the current international

geopolitical framework and that a failure in the

talks could be interpreted by other countries as a

sign of weakness in the EU-US relations.

According to high level negotiators the agreement

should be wrapped up next year.

19-23 May: Fifth round of negotiations in Washington

End of June: deadline for the public consultation on

dispute settlement (ISDS)

2015: Final Agreement


Chinese President also push for a EU-China Free Trade Agreement

On 31 March, the Chinese president Xi Jinping

met in Brussels the Presidents of the three main

European Institutions: Martin Schulz (European

Parliament), Jose Manuel Barroso (European

Commission) and Herman Van Rompuy

(European Council). The first historical visit of a

Chinese president to the European Institutions

was made possible thanks to an easing in trade

relations.

Just three days ahead of this visit the

Commissioner for trade Karel De Gucht put on

hold an anti-dumping investigation concerning

two majors Chinese telecommunication

companies, while China terminated, just one

week before, an investigation on European wines.

Less than one year ago the EU and China were

about to start a “trade war”.

The aim of both parts is to deepen the EU-China

strategic partnership that was signed in 2003 and

that currently covers foreign policy, security,

climate change and international economic

governance. According to insiders, the Chinese

delegation mentioned the question of a free trade

agreement (FTA) with the EU which is currently

the first trading partner for China. Europeans

negotiators, on their side, think that it is too early

and that there has to be progress on investment

to prepare the field for a FTA but consider that the

deal could be made in the “medium term”.

Issues such as climate, human rights and the

Ukrainian crisis have also been discussed during

the meeting.

Research and Development

The European Parliament debates on research on embryonic stem cells

On 10 April, Members of the European

Parliament held a public debate following the

presentation of the “One of Us” initiative. The

initiative was supported by 1.7 million signatures

in over 18 EU Member States requesting the end

to European funding for both embryonic research

and the support of abortion in development aid.

For over four hours, four European Parliament

committees battled between the arguments in

favour and the arguments against, in front of

various associations following the debate. The

One of Us arguments certainly hit the mark with

the conservative fringe of the European

Parliament. But several associations and NGOs,

supported by Liberal, Socialist and Green MEPs

warned European decision-makers of the drifting

that come about from an initiative brought by ultra

conservative groups and anti-choices

movements.


The controversial issue will now pass to the next

European Parliament, before the European

Commission decides at the end of May whether

or not to take legislative action on this subject.

28 May: Commission decides on legislative follow up

Taxation

The European Council formally adopts savings taxation directive

On 24 March, the European Council formally

adopted the draft revised saving tax directive. This

dossier had been vetoed since 2008 by Austria and

Luxembourg. The aim of the new directive is to fill

gaps in saving taxation in order to tackle tax

evasion. The new directive will expand the field of

application of the Automatic Exchange of

Information (AEI) to many types of financial

products like life-insurance, pensions or investment

funds. Currently, the AEI is applied only to interest

payments on savings to non-residents and involves

26 Member States.

During a transition period, Austria and Luxembourg

will be allowed to levy a 35% tax at source rather

than joining the AEI. Furthermore Luxembourg

announced that it will end banking secret starting

from 1 January 2015.

According to observers, Austria and Luxembourg

lifted their veto because the Commission seems

close to conclude a similar agreement with five

European countries considered as “tax havens”

(Switzerland, Liechtenstein, Andorra, San Marino

and Monaco). The EU Commissioner for Taxation

Algirdas Semeta expects a deal to be reached with

these five countries by the end of the year.

OECD Members States are expected to introduce

new AEI standard next May while revised directive

need to be transposed into national legislation by

January 2016 and come into force in 2017.

15 April: Publication in the official journal

May: OECD introduces new AEI Standards

1 January: end of banking secret in Luxembourg

January 2016: deadline for transposition of the

directive into national legislation

2017: Entry into force of the regulation

The European Commission launches two public consultations on tax issues

On 10 April, the European Commission launched

two public consultations to collect informations on

taxation issues that European citizens may face

across Europe. The Commission’s final aim is to

eliminate expenses or administrative burdens that

European citizens living or investing in another EU

country have to face.

The first public consultation covers general tax

problems EU citizens may face while living abroad.


The second one focusses on border inheritance

rights.

Furthermore the Commission decided to set up an

expert group which will be in charge of examining

good practices within Member States in order to

avoid cases of double taxation. The expert group

task will also include the identification of other taxes

that may have a dissuasive effect on mobility within

the Union like vehicles taxation or e-commerce for

instance.

3 July: deadline for the public consultation


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Business

Insights Brussels April 2014