Wednesday, 30 May 2007

Banking on Europe: why the EU Consumer Credit Directive will Impair the Financial Services Sector

An EU Consumer Credit Directive, which is currently being discussed, will not only significantly alter the financial services sector but has so far failed to take into account a thorough impact assessment for the sector. Both the European Commission and the Council have failed to look at what the consequences of this directive would be. The Consumer Credit Directive – governing the agreements covering credit for consumers – was adopted in 1987 and has been pursued with minimum harmonisation. Therefore, there remain important differences in national regulations which have been considered by the Commission as obstacles to the internal market. Hence, the European Commission has been attempting to amend the Consumer Credit Directive – since 2002 – in order to achieve full harmonisation.

However, the Commission’s proposals did not reach agreement amongst Member States. The revised Directive aims at harmonising Member State laws, regulations and administrative procedures in relation to agreements covering credit for consumers. After a long period of negotiation, on 21 May, the Competitiveness Council reached a political agreement on the Commission's amended proposal for a Directive on credit agreements for consumers.

Nevertheless, the Dutch and Greek delegations voted against the proposal and Belgium and Luxembourg abstained. The Council’s negotiations have been focused in the following areas: standard information for advertising, pre-contractual information and contractual information to be included in credit agreements, right of withdrawal, early repayment of the credit and the creditor’s right to compensation and the calculation of the annual percentage rate of charge (APR). The consumers must be able to make an information decision concerning the conclusion of a credit agreement. Therefore, the Council agreed that Member States should provide pre-contractual information on a standard form as such standardisation would be easier for consumers to compare different offers.

Furthermore, consumers will have a period of fourteen days to withdraw from the credit agreement without giving any reason. In relation to early repayment the Council has granted creditors a limited right to compensation for early repayment of the credit. However, it only applies for fixed interest rate credits and: “where the reference interest rate is lower at the time of the early repayment than at the time of conclusion of the credit agreement.” Moreover, Member States “will have the right to provide that the compensation for the early repayment can be claimed by the creditor only on the condition that the amount of repayment within 12 months exceeds a threshold defined by Member States. When fixing the threshold, which should not be higher than EUR 10,000 Member States will take into account, for instance, the average amount of consumer credits in their market.”

As for contractual information, the creditors will have the opportunity of indicating their borrowing rate and the charges or of indicating the annual percentage rate of charge, or of indicating both. With regards to advertising information and pre-contractual information, creditors have to indicate the borrowing rate plus charges and the annual percentage rate of charge.

The Council’s common position will be adopted at one of the Council upcoming meetings which will be forward to the European Parliament for a second reading. According to EUobserver, German Justice Minister Brigitte Zypries, said that “the new legislation would bring clear practical advantages to Europe's borrowers, particularly in terms of boosting transparency so that they can make genuine comparisons among credit offers.”

It should be borne in mind that the banking industry is not pleased with the new rules introduced by the Directive. The financial sector believes that the new measures might make credits more expensive in the EU. Moreover, British Conservative MEPs have been criticizing the Directive. For instance, according to Euractive, Malcom Harbour has said: “whilst conservatives have always welcomed the opening up of new markets, the views of the financial services sector must be properly taken into account through an impact assessment. Both the Commission and the Council failed to look at what the consequences of this directive would be when they should have done so.”

Friday, 25 May 2007

Why EU Integration is no Longer One Small Step for British Taxpayers

The European Union has recently established negotiations for the foundation of a common European vision in space. It is important to look at this particular vision, since it is catastrophic attempt toward regressive European integration, leaving Britain no longer as an independent nation-state but as part of the empowered European bloc, looking to launch a common space policy. It is as damning as a European Army or the full completion of European government. The future of the EU is no longer about negotiating lower (or no) trade tariffs between nations but about absorbing 27 nation-states into a formalised European super state with an unrealistic view of putting mankind into space. That is not an agreement that Britain ever signed with the other European Member States. Nor is Britain an existing Cold War Power – so hopes for it to contribute in the great space race are unqualified.

However, the European Commission persists in its undemocratic endeavours. Last April, the European Commission considered a text on European Space Policy, debating a joint policy document by the European Commission and the Director General of the European Space Agency (ESA). With this Communication, the Commission made clear its hopes to develop several elements of a European Space Policy. What’s more, space is one of the areas that the Draft Constitutional Treaty envisaged turning into a European policy. But, even without the full backing of the European Parliament and even without the Constitutional Treaty, a European Space policy is well under way.

So, what’s the point? According to the European Commission, the European Space Policy aims at increasing coordination between the EU, their Member States and USA concerning space activity, providing a more flexible framework to ease European investment in space activities. The European space policy “will be based on the peaceful exploitation of Outer Space by all states and will seek: to develop and exploit space applications, to meet Europe's security and defence needs as regards space, to ensure a strong and competitive space industry, to contribute to the knowledge-based society by investing strongly in space-based science, to secure unrestricted access to new and critical technologies, systems and capabilities in order to ensure independent European space applications.” Essentially, the Commission wants the Member States to pool and share their space technology. It should be borne in mind that the Security and Defence policy are key areas of Member States sovereignty and not declared areas of responsibility for the EU institutions. Member States have been watching with great concern since the EU began interfering with Member State security interests.

The EU’s achievement for a space policy will rest upon its existing and controversial negotiations over a sustainable civil navigation satellite system, Galileo. It has asked that the Galileo satellite navigation system and Global Monitoring for Environment and Security (GMES) be used by the military – which has been met with strong opposition. Naturally, the Commission has been looking to extend its competence far beyond its current capabilities – and in order to do so, it has not sought the permission of Member States. It should be observed that Karl von Wogau, Chair of the European Parliament Subcommittee on Security and Defence, has argued recently, at a hearing to discuss the Commission proposal for an EU space policy that Europe “needs information satellites for military missions, to protect its external borders, to protect sensitive infrastructure and even to warn of tsunamis.” To achieve its aims, the European Commission has increased its expenditure on space.

But it’s not just a financial burden – it’s a major political disaster. With the fast-failing Galileo satellite navigation system project, Europe wants to have independence from the US’s own Global Position System (GPS). The EU has recently been asking for 2.4 billon euros to help their project along. This can be understood as a worrying threat since, as Bill Cash MP has already argued, the US would be unable to share information with the UK which “has serious implications for the US-UK relationship.” It will, in sum, severely affect the UK-US relationship on matters beyond a common space policy.

You might well ask – who will be funding the contentious Galileo project? A private consortium was meant to have deployed Galileo through a Public-Private Partnership contract. Galileo’s construction and operation was supposed to be financed by public and private funds. However, the private consortium of eight companies, did not meet the 10th May deadline issued by the Transport, Telecommunications and Energy Council to sign the contract. Neither do private investors seem interested in taking the risk to finance €4 billion of the European Galileo satellite navigation system.

Of course, given its political and financial gravity, the Commission has struggled to negotiate the finance and terms of the Galileo project. On 16 May, the European Commission adopted a Communication entitled ‘GALILEO at a crossroad – The implementation of the European satellite navigation programmes (GNSS)’, in response to an earlier request from the Transport, Telecommunications and Energy Council. The Commission recognised that the completion of the project had been seriously threatened. The Commission understands the failure of the current concessions in the negotiations and has even stressed that the negotiations for Public-Private Partnership contract be ended. Taking into account all the difficulties, the Commission now has the choice of stopping the programme or to continue in a slightly different context.

The EU is concerned that it will become dependent on the US for its future systems. According to the Commission, the option to not pursue Galileo would increase EU dependency on the US system. Therefore, “this would mean that the European Union would be dependent on military/dual use foreign systems and technologies for applications vital to the running of the society tomorrow.” Furthermore, it knows that Galileo is essential for the future of the European Space Policy. Therefore, the Commission favours the option of Galileo being financed by the EU budget. Put quite simply, the Commission wants to finance the building of Galileo satellite infrastructure with public funds.

According to EUobserver, Jacques Barrot has said that: “it's €400 million per year which equals about 400km of motorway.” The EU´s taxpayers will pay for Galileo as the Commission does not want to surrender on this issue. The future of Galileo will be decided by the EU’s Member States transport ministers in June. That is when we shall see – since the European electorates have no say in the matter – whether Europe is still one small step for the British taxpayer.

Thursday, 24 May 2007

EU Mobile Roaming Charges Confirmed

So, after long and difficult negotiations between the European Council, Commission and European Parliament, a compromised deal has been reached on the EU Roaming Regulation and Pricing. The new legislation was agreed by the European Commission, European Parliament and Council over ten months – undeniably, a record time.

On 23 May, the EU Parliament adopted, in its plenary session, and by a strong majority, the first compromise deal on new roaming charges. The EU Regulation will cap mobile roaming charges before the summer. According to the deal, the inter-operator tariff (wholesale charge), excluding VAT, will be capped at €0.30 per minute. This price cap (“Eurotariff”) will be further reduced in 2008 and 2009, to €0.28 and €0.26 respectively. The maximum retail charge, excluding VAT, for calls made abroad will be capped at €0.49 per minute and it will decrease by 3 eurocents per year. The maximum retail charge, excluding VAT, for calls received abroad will be capped at €0.24 per minute and will decrease by 2 eurocents in 2008 and 3 eurocents in 2009.

During the negotiations the most contentious issue was whether to decide to an “opt-in” or an “opt-out” model. Under the compromise deal adopted by the European Parliament, after the entry into force of the Regulation, mobile operators will have a month to make these price caps available to customers. The customers will have two months to decide if they want the new roaming tariff. However, if the customers do not react, they will get the eurotariff after two months.

However, the European Parliament also approved the so called “sunset clause” which means that the EU regulation will expire after three years. Therefore, it will be up to the Commission to consider if there is a need to propose a legislative act to extend this period.
The Transport, Telecommunications and Energy Council is expected to formally endorse the EU Roaming Regulation on 7 June. This regulation will be directly applicable in all EU Member States after its publication in the EU’s Official Journal.

However, if we look towards the effect such legislation will have on Mobile Phone operators, it should be noted that the EU Roaming Regulation is likely to lead to higher domestic costs (as well as other mobile services such as text messages).

Tuesday, 22 May 2007

Why Gordon Brown needs more than Balls to reform Europe

Jim McConalogue, Editor of the European Journal, argues on Conservative Forum that whilst Ed Balls does recognise some of the key challenges for the EU, his pledge for "reform" is in vain since it coexists with making "the case for a hard-headed pro-Europeanism" – and that is precisely what already exists under Blair. Read his article here.

Wednesday, 16 May 2007

EU Mobile Roaming Regulation is set for Success

Yesterday, we reported on the failed negotiations for EU price cuts on the mobile roaming charges. Today – that failure seems to have turned to success.

On 15 May, the Council Presidency and a delegation of MEPs have reached an agreement on cutting roaming fees within the EU. Under the compromise, “the average wholesale charge (excl. VAT) that a "visited" operator can levy on a roaming customer’s "home" operator for the provision of roaming calls will be capped at EUR 0.30 per minute.” They agreed that making a mobile call abroad should cost €0.49 per minute and this price would fall to €0.46 in the second year and to €0.43 in the third year. It would cost €0.24 per minute to receive a call while abroad and this price would fall to €0.22 in the second year and to €0.19 in the third year.

Furthermore, under the new deal, according to EUpolitix, “customers will have three months to decide whether to switch to the new tariff, after which people with a standard contract – without specialised roaming tariffs – will be moved automatically to the new fees.”

Now, the new deal must be approved by the European Parliament in the next Plenary Session, possibly on 22 May, and must be endorsed by the Council. In this manner, the EU Transport, Telecommunications and Energy Council will be able, during their meeting on 7 June, to formally adopt this first reading agreement. Hence, if both the European Parliament and the Ministers formally approve the deal, the law will come into force in July.

Tuesday, 15 May 2007

EU Mobile Roaming Regulation May Never Happen

You may recall that on 12 April 2007, we reported on how the European Parliament's Industry, Research and Energy Committee approved the Commission's proposal of July 2006 for an EU Regulation on mobile roaming in the Internal Market. The European Commission wants to reduce the charges mobile phone users have to pay for making calls abroad by up to 70%. In general, the Commission, Parliament and Council agree on the objectives of the EU Roaming Regulation, but unsurprisingly mobile operators do not share their enthusiasm.

It is important to recall that Europe's telecom industry has been lobbying against roaming regulation. The roaming service is estimated to be worth €8.5 billion a year. Telecom companies have seen the cut on retail prices as an unprecedented excessive government intervention in prices.

The current negotiations between the presidency, Commission and the European Parliament have not been as successful during the last few days. Not all Member States such as UK and France are in favour of wide roaming fees cuts. Unsurprisingly, an agreement has not been reached yet over the price cuts for making and receiving calls and whether consumers should be obliged to “opt in “or “opt out” of the Consumer Protection Tariff. Therefore, the vote on the Plenary Session, scheduled for the 9 May, has been postponed.

As a result, if Member States and the European Parliament do not reach an agreement until the next Plenary Session, due to be held around the 22 May, the EU Council of Telecom Ministers would not be able to formally adopt EU Roaming Regulation during their meeting on 7 June. Consequently, a second reading might be necessary and the law would not come into force before the summer.

Monday, 14 May 2007

Gordon Brown Must Call on Blair to not commit to Constitutional Treaty which would prejudice the UK position

Following Tony Blair’s announcement to leave office by 27 June 2007, but noting his promised attendance at a major European Council Summit on 21-22 June, The European Foundation demands that Gordon Brown must pressure Blair not to commit to the Constitutional Treaty before his departure or leave the UK position open to further EU obligations.

In wake of the French and Dutch referendums of 2005, when their respective electorates voted against a European constitution, and a recent poll (commissioned by Global Vision) in the UK showing that 65% per cent of the Europeans want Britain to have a referendum demanding a looser relationship with the EU, it is clear that now is the time for Gordon Brown to take stock of the UK political climate and hold a public referendum on a Constitutional Treaty and all existing treaties.

Following the European Parliament’s discussion on a draft report entitled The roadmap for the Union's Constitutional Process, the European Foundation openly condemns the ambitions of the UK to agree on such a roadmap for the Constitutional process, in ignorance of the French and Dutch referendums of 2005 and against the wishes of the British electorate. Within the UK, it is essential for Brown to take the reigns and hold a nationwide public referendum – thereby renegotiating the UK’s position on the new Constitutional Treaty and all existing treaties.

Roger Helmer MEP, adviser to The European Journal, called for five major amendments to the current roadmap text, which currently presents a roadmap for the EU’s Constitutional Process. Roger Helmer’s tabled amendments which have been submitted to the European Parliament include ‘Amendment 46’, asking that the draft “Recognises that the Constitutional Treaty has been firmly rejected by two of the Union's founding member-states; understands that the electors of France and Holland were not seeking slight changes or cosmetic alterations to the Constitutional text, nor were they rejecting one particular draft in favour of some other constitutional approach, but they were rejecting the concept of "More Europe" in its entirety.”

Blair’s meeting with French President Sarkozy must not create any further agreement on a Constitutional Treaty. It is simply not the place of the exiting Prime Minister to decide on the future commitments of the UK to the European Union – that is a job for the national electorate by referendum.

It is clear from Gordon Brown’s position after 27 June that in order to make the European Union an institution which is beneficial to Britain and the other Member States, and thereby achieve greater democracy among European nations, it is essential for the UK to hold a public referendum and thereby renegotiate its position not only on the new Constitutional Treaty but on all other existing treaties.

Bill Cash MP, Chairman of the European Foundation, said:
“The situation is a travesty. Firstly, there should not even be a Constitutional Treaty. Secondly, if either Blair or Brown does think it is necessary, it should not be signed behind the backs of the British people. It should be held to referendum. Thirdly, it is now time for Gordon Brown to take the reigns and pledge a referendum on the Constitutional Treaty and all other treaties.”

Surrendering British Justice: European Court of Justice Considers European Arrest Warrant

You may remember that in June 2002, the EU Council of Ministers adopted a framework decision on the European arrest warrant (EAW) and the procedures of surrender between Member States. The EU’s Member States were required to introduce legislation to bring the European arrest warrant (EAW) into force by 1 January 2004. The European arrest warrant replaces previous extradition procedures between the EU’s Member States. It aims at facilitating and speeding up surrender procedures for suspected criminals within the EU yet it raises major issues on justice.

The European arrest warrant is executed by the Member States on the basis of the principle of mutual recognition which means that a judicial authority decision of a Member State requiring the arrest of a person should be recognized and executed in the other EU´s Member States. Therefore, under the Framework Decision, if the 32 offences listed “are punishable in the issuing Member State by a custodial sentence or a detention order for a maximum period of at least three years and as they are defined by the law of the issuing Member State, shall, under the terms of this Framework Decision and without verification of the double criminality of the act, give rise to surrender pursuant to a European arrest warrant.” It is hard to believe but dual criminality – which means that the act in question must be a crime not only in the country in which it took place but also in the country of surrender – was abolished for 32 categories of offences. Furthermore, under the EAW, the EU’s Member States can no longer refuse to surrender their nationals but they can ask for their return in order to them serve sentences on its territory.

The European arrest warrant is a clear example of loss of Member State sovereignty. It should be observed that, under the European arrest warrant, someone could be extradited from Britain for offences which are crimes in another EU´s Member State but not here. This is a matter of justice! For instance, a British citizen could be surrendered for offences such as Holocaust denial, which is illegal in Germany and Austria but not in the UK. The EWA, quite plainly, undermines British law.

Not all the EU's Member States met the implementation deadline of 31 December 2003 – therefore, on 1 January 2004, the European Arrest Warrant (EAW) only entered into force in Belgium, Denmark, Finland, Ireland, Portugal, Spain, Sweden and the UK.

It should also be noted that not all the offences listed are considered criminal offences under the criminal law of all EU´s Member States. We have 27 different legal systems. Therefore, there is a blatant problem with the EU arrest warrant. At least with the previous extradition procedures, the dual criminality principle was not waived.

There have been arguments, in different Member States, that implementing the Framework Decision breaches national constitutional rights. For instance, in July 2005, the German Constitutional Court declared it “unconstitutional” to implement the Council Framework Decision on the European arrest warrant and the surrender procedures between Member States in German Law.

Earlier, in 2004, the association ‘Advocaten voor de Wereld’ brought an action before the Belgium Court of Arbitration (Arbitragehof) seeking the annulment of the Belgian Law on the European arrest warrant of 22 December 2003 which transposed the Framework Decision on the arrest warrant into national law. Consequently, the Arbitragehof referred for a preliminary ruling to the Court of Justice several questions regarding the validity of the Framework Decision. The ‘Advocaten voor de Wereld’ has argued that the subject-matter of the European arrest warrant should have been regulated by a convention and not by a framework decision. It also considers that waiving the verification of double criminality is contrary to the principle of legality in criminal matters as there is no precise and clear definition of the offences.

It has stressed that “the offences set out in that list are not accompanied by their legal definition but constitute very vaguely defined categories of undesirable conduct. The judicial authority which must decide on the enforcement of a European arrest warrant will have insufficient information to determine effectively whether the offences for which the person sought is being charged, or in respect of which a penalty has been imposed on him, come within one of the categories mentioned in Article 5(2) of that Law.”

Unsurprisingly, the European Court of Justice did not uphold the Belgium challenge against the European arrest warrant. It is a shame, as Anand Doobay, lawyer at the UK law firm, Peters and Peters has said (according to EUObserver): “if the European Court of Justice finds in favour of the arguments made by the NGO then this could have a dramatic effect on the legality of the Framework Decision itself, not just in Belgium.”

The ECJ gave its judgment on 3 May 2007. The Court ruled that the Framework Decision on the European arrest warrant is valid. The Court has stressed that: “the European arrest warrant could equally have been the subject of a convention, it is within the Council’s discretion to give preference to the legal instrument of the framework decision in the case where, as here, the conditions governing the adoption of such a measure are satisfied.” According to the ECJ “the Framework Decision does not seek to harmonise the criminal offences in question in respect of their constituent elements or of the penalties which they attract.” Therefore, “while Article 2(2) of the Framework Decision dispenses with verification of double criminality for the categories of offences mentioned therein, the definition of those offences and of the penalties applicable continue to be matters determined by the law of the issuing Member State.”

Another clear case of what happens when European Member States surrender justice policy to the EU – The European Arrest Warrant is a clear example of a loss of state sovereignty.

Wednesday, 9 May 2007

UK Wants European Border Intervention Teams to Control Borders

On 20 April 2007, the Justice and Home Affairs Council agreed on the creation of Rapid Border Intervention Teams. The European Parliament has also approved a report in the April Plenary Session on the Draft Regulation establishing a mechanism for the creation of Rapid Border Intervention Teams (RABITs) and amending the Council Regulation for that mechanism.

The Draft Regulation stresses that Member States “should have the possibility to request the deployment, in the framework of the Agency, of Rapid Border Intervention Teams comprising specially trained experts from other Member States to its territory to assist its national border guards on a temporary basis.” However, this action occurs in very exceptional and urgent situations, such as when a Member State has to deal with a huge influx of non-EU nationals trying to enter illegally.

In this context, the Rapid Border Intervention Teams would provide a rapid and effective response. The Draft Regulation establishes that the Rapid Border Intervention teams should gather Member States financial means and human resources to act in emergency situations at the EU’s external borders. Therefore, under the principle of “mandatory solidarity”, Member States will have to contribute deploying trained border guards at the request of the agency for external borders, FRONTEX.

The border guards’ salaries of those teams deployed in a host country will be paid by the countries of origin but the operation additional costs such as travel expenses and insurance will be paid by FRONTEX. As the European Parliament and the Council have reached an agreement on first reading, the regulation would be adopted as soon as possible in order to have the teams operational by the summer.

The UK does not take part in the adoption of this regulation, and therefore, is not bound by it. However, Ms Joan Ryan, the Parliamentary Under-Secretary of State at the Home Office, has explained to the European Scrutiny Committee “that the Government will not be opting into the draft Regulation because the UK was excluded from participation in the FRONTEX Regulation and the Government's challenge to the exclusion has not yet been decided by the European Court of Justice.”

The action was brought on 17 February 2005 against the Council of the European Union (Case C-77/05). The UK is seeking the annulment of the Border Agency Regulation (under Article 230 EC) as its exclusion from the adoption of the Regulation entails the “infringement of an essential procedure requirement.” The UK has argued that “the Council acted on the basis of an erroneous interpretation of the relationship between Article 5 and Article 4 of the Schengen Protocol.”

The protocol attached to the Amsterdam Treaty made special provisions for the UK and Ireland which were not parties to the Schengen agreement and Convention. Hence, they were not bound by the Schengen acquis unless the Government expressly decides to opt in. Nevertheless, as David Heathcoat-Amory has said “the British Government has opted into 48 immigration and asylum measures and once a decision has been taken by the Government to opt into a particular EU measure, it is irreversible.”

If the European Court of Justice sustains the UK’s challenge, the government wants to opt into the RABITs. Moreover, the government wants the UK border officers to participate in RABITs on a case by case basis. Consequently, the government “has proposed a council declaration, to be added to the protocols when the measure is adopted at the June Council, repeating the UK's support for Frontex, highlighting the participation of the UK in Frontex activities, and inviting the agency and its management board to explore ways in which the UK can likewise practically support the operations of RABITs.”

Why does the UK Government want to opt into such a scheme of regulations? Well, the government support for RABITs is not purely altruistic – it wants to protect the UK from those who want to enter into this country after they have first got illegally into another Member State. But the central question remains – why should the UK lose further control of its borders?

Tuesday, 8 May 2007

“Proposals on consular protection for EU citizens” is Attack on UK Sovereignty

On 28 November 2006, the Commission adopted a Green Paper on diplomatic and consular protection of Union citizens in non-EU countries – a paper which has recently been analysed by the House of Commons European Scrutiny Committee (ESC). The European Commission has highlighted the need for enhanced consular protection given to EU citizens in non-EU countries, particularly in crisis situations.

Under Article 20 EC, “Every citizen of the Union shall, in the territory of a third country in which the Member State of which he is a national is not represented, be entitled to protection by the diplomatic or consular authorities of any Member State, on the same conditions as the nationals of that State. Member States shall establish the necessary rules among themselves and start the international negotiations required to secure this protection.”

In the Green Paper, the European Commission lays down several proposals to reinforce the right of Union citizens to Community diplomatic and consular protection, enshrined in Article 20 of the EC Treaty. Those proposals include: ensuring consular protection information is available to EU to citizens, provisions on the protection of EU citizens should be included in bilateral agreements with non-EU countries with a view to ensuring this protection, increase the entitlement to consular assistance in order to include non-EU family members of EU citizens. Decisions on identifying and repatriating remain a complementary action which could be made possible through a European compensation system.

Furthermore, the Commission has also suggested setting up common offices. According to the Commission, this “would help to streamline functions and save on the fixed costs of the structures of Member States' diplomatic and consular networks.” The aim of the Green Paper is to launch a debate on theses issues and according to the consultation’s outcome this may lead to a White Paper publication.

The House of Commons European Scrutiny Committee is not pleased with the Green Paper, as consular services are the responsibility of Member States. The Minister for Europe, Mr Geoffrey Hoon, explained to the ESC that he does not accept the Green Paper’s interpretation whereby Article 20 EC creates a legal right to consular assistance independent of domestic law as it “merely provides for the provision of consular assistance to unrepresented Member States' nationals on the same terms as it is provided to their own. Nor does it require setting minimum or equal standards for consular assistance amongst Member States.”

The Minister is also concerned over the possibility of the EU’s officials to provide consular assistance in the future. He recalled that under international law, consular relations are between States. Geoffrey Hoon holds that “consular assistance is most effectively provided by Member States themselves." Therefore, any Commission proposal on this issue will lead to worrying subsidiarity issues. It should also be noted that “proposals on consular protection for EU citizens” are among the Commission’s top priorities for 2008.

Blair ‘showing his contempt for voters’ over new EU treaty

On 20 April, the Daily Mail reported on our Chairman's view on the "amending treaty":

“Tony Blair was last night accused of treating the British people with 'contempt' after axing plans to allow them a vote on a new EU treaty. … Tory MP Bill Cash, chairman of the European Foundation, said: ‘As a democratic country, it is essential that we put in place national referendums on the new treaty and all other existing treaties. … To not do so is a gross injustice. It is undemocratic and treats the British people with contempt.' ” [Click here]

Tuesday, 1 May 2007

Why Can’t Britain Remove Burdens from Brussels?

Today, the Editor of The European Journal, James McConalogue, discusses the recent rejection of Clause 17 in Parliament and why Britain no longer seems able to remove burdens from Brussels. Read his article at Conservative Forum:

"It appears to be a bad day for British sovereignty when its own national parliament – after tabling Amendments, criticisms and Clauses for proposed Bills – has already decided on the submission of national sovereignty to foreign powers and proceeds with Amendments as a process of mere formality. Furthermore, that has been the disheartening predicament for parliamentary critics of EU integration within the House of Commons and Lords during the pro-European governments of the past thirty years. There has always been a healthy public opposition to further EU integration within Britain but …"

To read on, click here.

EU Adopts ‘Criminal Law’ Competency through the Backdoor

The EU has recently decided that it should make Criminal law a community competence. On 25 April 2007 the European Parliament adopted a first reading report, by Nicola Zingaretti, regarding a directive imposing criminal sanctions for the infringement of intellectual property rights. The report was approved by 374 votes to 278 with 17 abstentions. If adopted, this Directive would oblige Member States to deem all intentional infringements of intellectual property rights carried out on a commercial scale as a criminal offence. Hence, all Member States would have to treat breaches of intellectual property rights as criminal matters. Aiding or abetting and inciting anyone to infringe intellectual property rights will also be treated as a criminal offence.

The European Parliament backed the overall Commission proposal as it only amended some of its provisions. An amendment tabled by the GUE/NGL and Greens/EFA groups – rejecting the entire proposal on the basis that criminal law is not actually a Community competence – was later defeated by 452 votes to 197 with 11 abstentions.It needs to be observed that the Draft Directive is to be adopted by co-decision of the Council and the European Parliament, with the Council voting by qualified majority. Hence, the Member States will not have veto power.
Provisions on police and judicial cooperation in criminal matters are within Title VI of the EU Treaty (“Third Pillar”). Decisions and Framework Decisions are the EU’s instruments under this Title. The Proposals are made on the initiative of the Commission or a Member State and they have to be adopted unanimously. Thus, if the Council considers that is necessary to provide for criminal sanctions, it must adopt unanimously a framework decision to support the measures adopted under the EC Treaty. Furthermore, it should be noted that the European Court of Justice has limited powers under the “Third Pillar”, for example, there is no provision for actions for failure to act. Thus, if criminal law is moved into EC Treaty, the power of the EP and ECJ would be increased and national vetoes will be at stake. With this, who needs the Constitution?!

There are several reasons why this Directive should not be adopted.

First of all, Criminal law is not and cannot be a community competence. Criminal jurisdiction is a key part of Member States sovereignty. The Community has no express power under the EC Treaty to adopt criminal law measures. As the law Society has said “there is not a sufficient legal base in the EC treaty for all the provisions contained in the proposed measure. It is inappropriate for an EC Treaty measure to be so prescriptive in relation to criminal sanctions.” The ECJ’s ruling, from September 2005, on the Community’s power to adopt criminal measures regarding environmental policy is not clear and the Commission has made the broadest interpretation possible. There is no need to intervene by imposing criminal penalties as the majority of the Member States already enforce intellectual property rights by means of criminal penalties. Ms Fiona Mactaggart has told the House of Commons European Scrutiny Committee that the United Kingdom’s law already foresees criminal penalties for counterfeiting and piracy on commercial scale but not for all intellectual property offences. Therefore, the government believes that these measures are not essential to deal with intellectual property crime.

The Law Society has said “that the existing scope of criminal law in the UK in this field is appropriate.” Furthermore, they “question whether an across-the-board criminalisation of commercial scale intellectual property infringements throughout the EU is actually in the public interest and whether it serves justice effectively.” Criminal sanctions should be left to national law. It has also suggested that the Directive should only state that “sanctions should be proportionate, legitimate and persuasive, levels of sanctions should be laid down in a Framework Decision.”

If it were adopted, the Directive would be the first to enforce changes to Member States’ criminal law on the grounds of the ECJ’s ruling. It will be the first Directive aimed at harmonizing criminal law.

The text approved by the European Parliament will be sent to the Council of Ministers. Hopefully, an agreement will not be reached between the Council and the European Parliament. If there were a consensus, it will effectively be attempting to enforce criminal law as a key competence, without right, vote, legitimacy or responsibility given to this area by the Member States.

For further details, Margarida Vasconcelos will be writing a more extensive article based on this blog in the next issue [May-June] of The European Journal.