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JOINT COMMITTEE ON EUROPEAN AFFAIRS (Sub-Committee on European Scrutiny) debate -
Thursday, 26 Oct 2006

Scrutiny of EU Legislative Proposals.

The first item is COM (2006) 473 — an amended proposal for a regulation on mutual administrative assistance for the protection of the financial interests of the Community against fraud and any other illegal activity. The committee previously considered the earlier draft, COM (2004) 509, of this proposal at its meeting on 24 May 2005. The amended text of the earlier proposal follows from the acceptance by the Commission of a number of amendments and observations from European Union institutions.

The stated aim of the proposal remains the same, namely, to combat fraud against the Community's income and expenditure, particularly in the areas of transnational VAT fraud, laundering, proceeds of EU fraud and Structural Funds fraud. The Commission contends that the current EU legal framework is not complete enough to tackle these matters sufficiently. The Commission is therefore proposing that it be given a supporting co-ordinating role in overseeing EC fraud activities.

The earlier draft was referred to the Joint Committee on Finance and the Public Service in March 2005 because of a number of significant concerns about the proposal. While some of these concerns have been addressed in the current text, the Department once again underlines a number of areas of contention. For example, the access by the Commission to members states' records and the very significant matter of the proposed use of qualified majority voting to adopt the proposals that remain unresolved. It is proposed that the proposal be referred for further scrutiny by the Joint Committee on Finance and the Public Service. Is that agreed? Agreed.

COM (2006) 487 is a proposal for a regulation on the marking of the meat of bovine animals aged 12 months or less. The Commission's memorandum to the proposal sets out that there are essentially two major systems of feeding young bovine animals — either with milk products or with cereals — with the first group dealt with before eight months and the second after ten months. The Commission contends that consumers are currently confused as to which of these two products it is buying, due to unclear labelling.

The Commission is proposing the establishment of sales descriptions to be used in each member state for the marketing of the meat of animals in each of the two sub-categories of animal defined. It is proposed that the two categories would be eight months and under for veal, and between eight months and 12 months for beef.

Under the proposed measure, member states would designate the authorities competent to carry out checks on the conditions set down and provision should be made for the Commission to ensure, where necessary by means of on-the-spot checks, that these conditions are met.

The Department indicates that Ireland does not produce veal in significant quantities and that the beef produced from the age category of animals below 12 months is invariably not marketed as veal. The Department also indicates that it will be seeking the amendment of the proposal to allow for an interim category such as rose veal.

It is proposed that the proposal be referred for further scrutiny by the Joint Committee on Agriculture and Food, particularly on concerns over the narrow interpretation of veal products. Is that agreed?

What is meant here? Is it that as we speak veal is classified in Ireland as beef?

No. It is all about the age of the meat being offered to the consumer.

I now understand.

COM (2005) 505 is the proposal for a directive establishing a framework for Community action in the field of marine environmental protection. This proposal and the earlier note concerning the proposal were referred to the Joint Committee on Communications, Marine and Natural Resources in May 2006. I understand that a current redrafted note was provided for the Joint Committee on Communications, Marine and Natural Resources and the Joint Committee on Environment and Local Government on 16 October. It is proposed that the additional note be forwarded for the information of the Joint Committee on Communications, Marine and Natural Resources in the context of its consideration of this matter. It is also proposed that the document be forwarded for information to the Joint Committee on Environment and Local Government. Is that agreed? Agreed.

COM (2006) 507 is the proposal for an amending directive concerning procedural rules and evaluation criteria for the prudential assessment of acquisitions and increase of shareholdings in the financial sector. The Commission contends in the memorandum to the proposal that "the current [European] legal framework does not provide specific criteria for assessing the suitability of the acquirer and has thus afforded considerable latitude to the relevant authorities in accepting, discouraging or rejecting a proposed acquisition". The Commission is, therefore, proposing an amendment that would modify "the existing framework considerably".

The aim of the proposed amendment is to apply "full harmonisation" of the prudential criteria. These criteria would be based on the following: the reputation of the proposed acquirer; the reputation and experience of any person who may run the resulting institution or firm, and the financial soundness of the proposed acquirer; the on-going compliance with the relevant sectoral legislation; and the risk of money-laundering and terrorist financing.

The Department underlines that the proposed amendment does not move away from the fundamental principal that financial regulators can only block financial mergers and acquisitions based on prudential criteria and on its "initial assessment" of the proposal, the proposed measure would have "neutral implications for Ireland". The adoption would have EU-wide implications, nonetheless, for all financial institutions. It is proposed that the proposed measure be referred for further scrutiny by the Joint Committee on Finance and the Public Service. Is that agreed? Agreed.

As there are no Title IV measures for this meeting, we will proceed to CFSP measures. CFSP (2006) 671, is the Council Common Position extending the validity of certain measures in support of the effective implementation of the mandate of the International Criminal Tribunal for Former Yugoslavia, ICTY. It is proposed to note the measure. Is that agreed? Agreed.

There are no documents proposed for deferral. There are 15 proposals proposed for no further scrutiny, items 5.1 to 5.15. Item 5.1, COM (2006) 478, is the proposal for a codifying directive on the space for mounting the rear registration plate of two or three-wheel motor vehicles. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.2, COM (2006) 486, is the proposal for an amending directive on the approximation of the rates of excise duty on alcohol and alcoholic beverages. Council Directive 92/84/EEC concerns the approximation of rates of excise duty on alcohol and alcoholic beverages through the setting of minimum rates. Under Article 8 of that directive the Commission is required to regularly update these rates. The Commission is now proposing to increase the minimum rates in force to take account of inflation.

The Department sets out that the proposed minimum rates are lower than those in place in Ireland and a number of other member states. The Commission in the memorandum to the proposal indicates that the adopted measure would impact most particularly on rates in operation in Malta, Latvia, Germany, Luxembourg, the Czech Republic, Cyprus and Lithuania. The Department, however, sets out that failure to increase these rates would result in the erosion of real values and also impact on the functioning of the Internal Market.

An additional point of interest is the observation in the Commission's memorandum to the proposal that "the vast majority of Member States do not consider that health and social aspects should be major determinants in setting rates". As members will have seen, the Department has set out that it did not share this majority view and that it has additionally indicated that it advocated an alternative approach based on health and social considerations.

It is proposed that the proposal does not currently warrant further scrutiny. It is also proposed that the proposed measure be forwarded for information to the Joint Committee on Health and Children in the context of the health and social aspects of the proposed measure and the additional information provided by the Department. Is that agreed? Agreed.

Item 5.3, COM (2006) 498, is the proposal for a decision on the reallocation of funds received by the European Investment Bank to finance operations benefiting the Democratic Republic of Congo. The Council in 2003 adopted a decision on the reallocation of funds received by the European Investment Bank for operations carried out in the Democratic Republic of Congo. That decision provides additional funding of €105 million for the implementation of aid operations in the DRC. The reason stated in the Commission's memorandum for the allocation to the DRC is that "the funds allocated to that country are clearly inadequate". The reallocated funds would be managed by the Commission and used to finance operations benefiting the DRC.

It is indicated in the Commission's documentation that the €105 million would otherwise have been returned to the member states and in this regard the Department had been requested to clarify the financial implications for Ireland of this matter. The current proposal is technical in nature and would align the earlier decision with the established regulation that the funds reallocated be committed by December 2007.

It is proposed that the proposal does not currently warrant further scrutiny. It is also proposed that the Department be requested to outline the mechanism that would have operated for the return to the member states of the sums involved in this proposal and that this information, along with related documentation, be forwarded for information to the Joint Committee on Foreign Affairs for the particular attention of the sub-committee on development issues. Is that agreed? Agreed.

Item 5.4, COM (2006) 513, the proposal for a codifying regulation on the export of cultural goods. It is proposed that the proposed measure does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.5, COM (2006) 523, is the proposal for a directive adapting certain directives in the field of company law, by reason of the accession of the Republic of Bulgaria and Romania. The proposed measure consists of listing the specific company types currently in Bulgaria and Romania in existing EU legislation. It is proposed that the proposed measure does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.6, COM (2006) 524, is the proposal for a regulation across a range of policy areas by reason of the accession of Bulgaria and Romania. The aim of this proposal is to amend European Union legislation following the conclusion of the Act of Accession of Bulgaria and Romania. This is to make the technical amendments to these pieces of legislation necessitated by the accession of these two states. As members will have seen, the legislation concerns, inter alia, energy, the environment and statistics. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.7, COM (2006) 534, is the proposal for a directive concerning the extension of the establishment of European Works Councils in Community-scale undertakings to include Bulgaria and Romania. The aim of Directive 94/45/EC is to improve the right to information and to consultation of employees in Community-scale undertakings and Community-scale groups of undertakings.

This measure would extend the provisions of the directive to both Bulgaria and Romania and would enter into force on their accession to the European Union. It is proposed that the proposed measure does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.8, COM (2006) 544, is the proposal for a regulation with regard to increasing the volumes of tariff quotas for certain fishery products for the period 2004-06. The Commission sets out in the memorandum to this proposal that to ensure an adequate supply of certain fishery products to the Community processing industries, it is proposing here to increase the volumes of tariff quotas for these fishery products. The fish covered by the proposed measure includes anchovies, cod and fillets of tuna. It is proposed that the proposed measure does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.9, COM (2006) 559, is the proposal for decisions concerning the facilitation of the elimination by the EC and Bulgaria of certain technical barriers to trade. The adoption of this proposal will widen the Internal Market in this technical area and increase competition and the availability of both parties' products. It is proposed that the proposal does not warrant further scrutiny. It is also proposed that the proposed measure be forwarded for information to the Joint Committee on Enterprise and Small Business in the context of the possible increase in market penetration by Bulgarian products. Is that agreed? Agreed.

No. 510, COM (2006) 560, is a proposal for a regulation concerning the imposition of a definitive anti-dumping duty on imports of ethanolamines originating in the United States of America. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed

No. 511, COM (2006) 582, is a proposal for a regulation concerning extending definitive anti-dumping duties imposed on imports of coumarin originating in the People's Republic of China to imports of coumarin from Indonesia and Malaysia. Coumarin is an essence used as a fragrance in detergents, cosmetics and fine fragrances. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

No. 512, COM (2006) 584, is a proposal for a regulation concerning the termination of an interim review of definitive anti-dumping duties imposed on imports of bicycles originating in the People's Republic of China and the continuation of the duty. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

No. 513, COM (2006) 585, is a proposal for a regulation terminating a review concerning definitive anti-dumping duties on imports of synthetic staple fibres of polyesters originating in the People's Republic of China. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

No. 514, SEC (2006) 1176, is amending letter No. 2 to the preliminary draft budget for 2007. Under the financial regulation, the Commission may amend its preliminary draft budget, PDB, in light of changed circumstances and new information. The Commission proposed a number of budgetary amendments concerning a number of initiatives, including the International Fund for Ireland, that will receive €15 million euro in the year ahead from the EU. The Department indicates that adoption of the measure would result in an increase in Ireland's contribution to the European Union budget of €185,600. It is proposed that the proposed measure does not warrant further scrutiny. It is also proposed that the related documentation be forwarded for information to the Joint Committee on European Affairs, particularly in the context of the additional allocation to the International Fund for Ireland. Is that agreed? Agreed.

No. 515, 13273/06, is a proposal for an amending Council regulation concerning certain insolvency, winding-up and liquidator proceedings in the Czech Republic. This proposal is to amend the relevant annexes to the legislation to take account of changes in Czech national legislation. It is proposed that the proposal does not warrant further scrutiny Is that agreed? Agreed.

No. 516, COM (2006) 543, is a proposal for a directive of the European Parliament and of the Council concerning integrated pollution prevention and control. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

No. 517, COM (2006) 533, is a proposal for a Council directive adapting certain directives in the field of energy, by reason of the accession of the Republic of Bulgaria and Romania. The aim of this proposal is to amend European Union legislation in the area of agreed targets for electricity production from renewable resources following the conclusion of the Act of Accession of Bulgaria and Romania. The Department sets out that it is anticipated that the overall target in this matter is likely to remain unchanged — at 22% — following the accession of both states. It is proposed that the proposed measure does not warrant further scrutiny. It is also proposed that the proposal be forwarded for information to the Joint Committee on Communications, Marine and Natural Resources. Is that agreed? Agreed.

On Nos. 6 and 7, there are no adopted measures or early warning notes on today's agenda.

No. 8 is the draft 72nd report, which has been circulated and read. I propose that the report be forwarded to the Joint Committee on European Affairs for agreement to lay before both Houses, along with appendices. Is that agreed? Agreed.

No. 9 is the minutes of the meeting of 12 October 2006, which were circulated to members. Are they agreed? Agreed.

We received one item of correspondence, namely, a letter dated 19 October 2006 from the All-Party Oireachtas Committee on the Constitution concerning the Green Paper on conflict in law of matters concerning matrimonial property regimes which we referred to it for its information. It is proposed to note this correspondence. Is that agreed? Agreed.

The sub-committee went into private session at 9.55 a.m and adjourned at 9.56 a.m. until 9.30 a.m. on Thursday, 9 November 2006.
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