Resumption of the session
President.
I declare resumed the session of the European Parliament adjourned on Thursday, 19 June 2003.

President.
Colleagues, it is my sad duty to inform you of the death, on Saturday, 21 June 2003, of Mr Pieter Dankert, President of the European Parliament from 1982 to 1984. Piet Dankert was the very model of a Parliamentarian - resolute, straightforward, plain-speaking - who served the interests of his electorate, his party and of the European Parliament.
His efforts to secure greater powers for the European Parliament gave us a position from which today we still derive daily benefits and influence in our work.
As President, Piet Dankert steered the course of the European Parliament during one of the most difficult phases of the Union's history. His own enterprising spirit and non-conformist approach, his constant concern for the man in the street and his own sense of humour and personality were defining characteristics of his presidency at that time.
As an historian Pieter Dankert never lost sight of the long-term view that gave him the vision and wisdom that Europe needed then and still needs today.
On behalf of the European Parliament I have expressed my profound respect and condolences to his family. I invite you to observe one minute's silence for our colleague Pieter Dankert.
(The House rose and observed one minute's silence)

Van den Berg (PSE).
Mr President, ladies and gentlemen, Piet Dankert, from Stiens in Friesland, whose enthusiasm for social democracy had been kindled by his Frisian grandfather, started his career as a teacher, and made an important contribution in Europe in many roles, of which I should like to list a few examples.
Openness. The election of Piet Dankert to President of the European Parliament was the first time that a decision of such significance had not been reached internally among groups. The election was held in an open and almost professional manner, and included a press campaign. This action was about twenty years ahead of its time. Piet Dankert, monsieur le Président.
Perseverance. As a good European, Piet believed in the right and proper use of European money. He took an interest in any report of possible misuse. However, he was also keen to find out whether the accounts were true. Sometimes, the facts were somewhat distorted to ensure that other bodies with more powers would actually take action.
Democracy. In 1979, Piet Dankert managed to give the European Parliament more bite by deploying budget legislation as a political instrument in an inventive manner. He threatened that Parliament would vote against the Budget, and this is exactly what happened. Ever since, the Commission and Council have been forced to take the European Parliament seriously.
Vision. Piet Dankert wanted a more social and democratic Europe with a clearly defined role in a world with which it shows solidarity. Piet Dankert featured in this connection as a level-headed and realistic champion of the European ideal. In the capacity of secretary of state for Europe, he tabled proposals for a more democratic Europe during the Dutch Presidency in Maastricht in 1992. Governments were not quite ready for this. Piet Dankert observed with satisfaction that the results of the Convention were not dissimilar from his own proposals all those years ago.
Enjoyment. In 1979, Piet Dankert made a very conscious and clear decision in favour of the European Parliament over the Dutch Second Chamber. According to him, operating at international level was more fun and more exciting. He also knew how to enjoy the pleasant sides of his job. From time to time, Piet was able to appreciate a meal consisting of a little more than a cheese roll and a mug of buttermilk.
Relations. He was averse to hoo-ha, could be very obstinate, yet was at times almost shy. He was a kind and honest man, and was able to identify with the political way of thinking of people from other countries. Over the past few days, and during the commemorative service yesterday in the Great Church at Edam, many confirmed this image of him as Monsieur l'Europe.
We hope that all these impressions, qualities and images of Piet Dankert will be of comfort to his wife, Paulette, and his children.

President.
The House will recall that last Tuesday six British soldiers were shot and killed in southern Iraq. These young soldiers were not engaged in military action, but were military policemen involved in training Iraqi police in the region. Their deaths are a tragic reminder of the sacrifice paid by European servicemen and by the civilian populations in regions such as Iraq and Afghanistan, still ravaged by conflict and severe hardship.
I would ask the House to rise for a minute's silence in their memory.
(The House rose and observed one minute's silence)

President.
The final draft agenda as drawn up pursuant to Rules 110 and 110a of the Rules of Procedure by the Conference of Presidents at its meeting of Thursday, 26 June has been distributed. The following changes have been proposed

Roth-Behrendt (PSE).
Mr President, I do indeed have an objection to make to this. That this House takes lawmaking seriously and treats it as being important is good practice. You will be aware that, tomorrow, as the Conference of Presidents has decided in its wisdom, we will first be having an associated second-reading debate on genetically-modified food and traceability, followed by a joint debate on food legislation, part of which will be on a second reading, and then there will be other debates, also on second readings. Without wishing to belittle the oral question put by the Group of the Greens/European Free Alliance, I am convinced that the order of debate proposed by the Conference of Presidents was the right one. I sympathise with the Commission, which evidently has organisational problems, and I am sure - indeed, I have absolute confidence - that it can sort these organisational problems out, and that it will be in a position later in the day to give an answer to this question.

Ford (PSE).
Mr President, as you will be aware, the relevant Rule states that there will be a debate and vote. I presume there will be a debate as well, as the Rule specifies.

President.
As I understand it, the request was for a vote on the resolution, not a debate. However, if you wish to have a debate also, this could be added at the end of business on Tuesday, because the agenda for Wednesday is already very full.
(The President established that there were no objections to this proposal)

De Rossa (PSE).
Mr President, I would like to raise the matter of the European Youth Parliament and the funding of EUR 180 000, which this Parliament approved for the year 2003.
The difficulty is that the Youth Parliament is now at risk of having to cancel its event planned for 11-20 July because the Commission is refusing to confirm that this money is available to it in order to run this event.
I am appealing to you, Mr President, to contact the Commission as a matter of urgency to seek to ensure that this money is made available, or at the very least that a letter is sent to confirm that it is available, so that these young people - who, after all, are the future politicians who will maintain this institution and other European Union institutions - are allowed to continue with their work. They need this confirmation urgently because they need to access temporary financing in order to overcome the difficulty created by the Commission.

President.
We will contact the Commission on that matter this afternoon.

Napoletano (PSE).
Mr President, less than a month on from the visit of the President of the People's Democratic Republic of Algeria, Mr Bouteflika, to this House, which should have strengthened the ties between the European Union and Algeria, a serious incident has taken place. The Algerian ambassador to the United Nations has requested that the representative of the United Nations Development Programme, UNDP, leave Algeria. For its part, the World Bank has decided to suspend programmes in the country until the presidential elections in 2004. I would ask, Mr President, for a response from Parliament, that a letter of response be sent to the President of the Republic and the Algerian Government and that a letter of support be sent to the United Nations Secretary General and to the person concerned. I would also call upon the Commission to arrange a debate with the United Nations on the situation of this country, with regard to judicial reforms and, in particular, the earthquake. I hope, Mr President, that you will act on my request.

Schmidt, Olle (ELDR).
Mr President, you were very quick in drawing up the work plan. In accordance with Rule 110a of the Rules of Procedure, I should like a decision to be taken, without a debate, on the report on Austria's initiative for drawing up a list of so-called safe countries that offer asylum. I have been the rapporteur for this report by the Committee on Citizens' Freedoms and Rights, Justice and Home Affairs, and the report was voted through by 27 votes in favour and two against.
It would be unfortunate if a decision on this issue had to wait right until September. I should have liked to see a debate, but it would be good if we could take a decision on this issue in the course of this week. In accordance with Article 110a, I should like this report to be voted on this week.

President.
Mr Schmidt, I do not want to open a debate on this issue at the moment. Ordinarily, this should be signalled to the services in advance. Then, as I have done with the other issues of which we have been informed in advance, I would put it to the House for adoption or rejection.
At this stage I regret to say that you have missed the boat with regard to setting the agenda. We did not deal with it last week at the Conference of Presidents and it was not signalled to us under the relevant procedure in time to deal with it today. We have already been through the adoption of the agenda and the issue was not raised at that time.
It seems to me that I have covered the requirements under the Rules of Procedure. Under the Rule you quote it clearly says that we adopt such changes at the start of a part-session. Regrettably, you raised the point when we had finished that part of the procedure.

Schmidt, Olle (ELDR).
Mr President, you are absolutely right but I was not fast enough. I was told that the boat was there last week, and the question was raised. We can debate it in September but it is unfortunate because the matter ought to have gone before the Council this week. I will be quicker next time!
Lambert (Verts/ALE).
Mr President, I wish to raise an issue which has been brought to my attention because of my work with refugees. It concerns an individual of Iranian origin living in the UK who, on a visit to Syria, was abducted by the Syrian authorities and handed over to the Iranians. His name is Jamil Bassam and he has been living in the UK for 25 years. He visited Syria with all the appropriate documents and, along with a colleague, Ibrahim Khodabandeh, was abducted by the Syrian authorities and handed over to Iranian officials.
Given the disquiet voiced in this House on many occasions about the situation in Iran, and the way in which political opponents are treated there, this is obviously a matter of some concern. I am asking you, therefore, to raise this issue with the Iranian authorities and do what you can to secure his safe release and that of his colleague.

Banotti (PPE-DE).
Mr President, my point of order is not as serious as some of the previous ones. It has been brought to my attention that a Union Jack is flying out of a window between the sixth and seventh floors of the Louise Weiss building. This might be a rash of patriotic enthusiasm or the flag might be just hanging out to dry. We cannot tell from looking at it from the outside who is responsible for this; I have my suspicions though.
Could we ask whoever has hung out this Union Jack to perhaps remove it, unless we are all to hang our flags outside the windows. As you know, Mr President, this is against the rules.

President.
All I can say to you, Mrs Banotti, in your role as chairman of the College of Quaestors, is PACE!

Nogueira Román (Verts/ALE).
Mr President, another ten emigrants drowned yesterday while trying to reach Italy. They wanted to work in Europe. In the last few weeks, hundreds of emigrants have suffered the same tragic fate off the coasts of southern Italy, Andalucia and the Canary Islands. I mention this state of affairs once again in an attempt to induce Parliament and the Union to take the necessary political steps to avoid these intolerable tragedies and prevent them from happening ever again. In any event, let us remember these innocent people.

Bautista Ojeda (Verts/ALE).
Mr President, please allow me to thank you on behalf of all Andalusian fishermen, and on my own behalf, for the efforts you are making to persuade the Portuguese authorities to free Agustín García, the fisherman who, as you know, has spent more than two months in prison.
Mr President, the Guadiana fishing agreement between Spain and Portugal expires today, and it would be really positive if the negotiations on the renewal of this agreement were to begin with a gesture of friendship and goodwill on the part of Portugal, freeing the imprisoned fisherman, as well as a commitment on the part of all fishermen to respect all the agreements signed.
I would like to thank you once again and I would ask you not to forget this issue and to communicate this proposal to the relevant authorities.

Villiers (PPE-DE).
Mr President, I, like a previous speaker, wish to refer to the case of Mr Abrahim Khodabandeh and Mr Jamil Bassam, both of whom are residents of Barnet, in my constituency. Mr Khodabandeh - who has been resident in the UK for many years and was granted refugee status - was travelling recently in Syria to assist humanitarian efforts to deal with the consequences of the war in Iraq. He was forcibly removed from Syria and taken to Iran where he and his colleague, Mr Bassam, remain in custody. Mr Khodabandeh's family and friends are deeply concerned about his fate.
I ask the House to urge the Iranian authorities to release Mr Khodabandeh, since his deportation contravened the ordinary principles of international law. We are very concerned about the circumstances of the deportation. I urge the House to add its efforts to the campaign to free these two people.

President.
As you said, our colleague, Mrs Lambert also raised this point. Yes, I will prepare an exchange of letters with the relevant authorities and send copies to both of you in the course of the week.

Ahern (Verts/ALE).
Mr President, I refer to the continuing media reports that US President Bush is accusing the EU and EU leaders of funding Hamas. These reports have been ongoing over the past week. I ask you to communicate strongly to President Bush that there is no truth in this allegation. In Rome this last weekend, at a meeting of the EU-US delegation, I and other Members of Parliament strongly refuted this allegation and outlined the stringent budgetary controls in place for the funding of the Palestinian Authority, to make sure that such funds are not misappropriated. I urge you to raise this issue with President Bush at the earliest possible opportunity.

De Keyser (PSE).
Mr President, this afternoon in Laos the verdict has been reached in the case of three westerners. A Belgian, Thierry Falise, a Frenchman, Vincent Reynaud and their American interpreter of Hmong origin have been sentenced to 15 years in prison. That is a long time. Back in December 2001 we voted for a resolution criticising the arbitrary arrests and the political situation in Laos. We have a cooperation agreement with that country. I would like you to intervene on behalf of the European Parliament in order to achieve the release of these people as soon as possible; and this within the context of all the diplomatic manoeuvring currently under way in relation to this sentence, which violates the freedom of the press.

President.
I should like to inform you that this issue was drawn to my attention at the last part-session. We have written to the authorities concerned. We will also deal with the subject of Laos on Thursday this week under the debates on breaches of human rights, democracy and the rule of law. Parliament will thus have the opportunity to express itself in a vote on a resolution. We will then follow up on the basis of that particular debate.

President.
The next item is the report (A5-0246/2003) by Klaus-Heiner Lehne, on behalf of the Committee on Legal Affairs and the Internal Market, on the request for waiver of the immunity of Mr Daniel Marc Cohn-Bendit ((2000/2109(IMM)).

Lehne (PPE-DE)
Mr President, I hope I will not use up all these five minutes. This procedure has to do with an application for the waiver of Mr Cohn-Bendit's parliamentary immunity made by the Public Prosecutor's Office in Frankfurt on the basis of charges laid by a member of the Hessen Land parliament. In these charges, Mr Cohn-Bendit is accused of obstructing the course of a prosecution, in that - as stated in newspaper reports - he, together with others, a number of decades ago now, helped a Mr Klein, a terrorist alleged to have taken part in the OPEC attack in Vienna, to flee to France.
In the normal course of events, Parliament would comply with such a request when it was made. There were, however, a number of peculiarities, which led the Committee on Legal Affairs and the Internal Market to take a somewhat different approach to this matter. One reason why it did so was that the original application submitted to us was - let me put it frankly - relatively flimsy; that is to say, its substance did not amount to very much. The result of this was that, in the summer of 2000 - only a few weeks after the application was made to us - the then chairman of our committee, Mrs Ana Palacio, wrote a letter to the German authorities asking for further detailed information. The German authorities supplied this further detailed information after two more years had elapsed - that is how long this process took - and this meant that our committee could then rule on the matter.
I myself had, as rapporteur, originally proposed that, in this specific case, a conditional waiver might be considered, as is provided for in our Rules of Procedure, but - as I mentioned earlier - there is a whole array of peculiarities associated with this case, and these meant that the great majority on the committee saw it as right and proper not to waive immunity in this specific case. Such was the prevailing opinion.
One of the reasons for this is that, as regards at least some of the things Mr Cohn-Bendit may have got up to at the time, he did them at the behest of the German internal secret services, or with their direct or indirect involvement; it is in any case quite remarkable that the secret services should involve themselves in such things, while, on the other hand, the law enforcement authorities of the same country seek to take action against them. Another point was that Mr Cohn-Bendit indicated that it was him alone against whom investigations were in progress, rather than against all the others named in this newspaper article as possible accomplices. The third point has to do with the proceedings against the terrorist Mr Klein, which have now run their course, and in which the judge, in stating the grounds on which his judgment was based expressed admiration for what Mr Cohn-Bendit had done and depicted it as a typical example of what constructive help could be given to enable such people to break free from terrorist circles.
Against this background, the committee came to the conclusion that the special circumstances of this case mean that the waiver of immunity does not appear to be justified. I would like to make it quite clear that this does not mean that we are accusing the Frankfurt Public Prosecutor's Office of fumus persecutionis, that is, of criminal proceedings intended to prejudice Mr Cohn-Bendit's political activities. That is something that I too repeatedly opposed in the debate in the committee, quite simply because, as German law on immunity stands, a German public prosecutor's office simply cannot do otherwise; it is not permitted even to open a file and commence investigations before a definite decision has been taken on the waiver of immunity. Taking the overall circumstances of this case into account, however, it seems appropriate to us - particularly in view of the European elections being not that far off - that immunity should not be waived in this case. I ask the plenary to endorse the committee's proposal.

Zimeray (PSE).
Mr President, I agree with the opinion of the rapporteur. I would like to take this opportunity to say a word or two on the reasons leading us to believe that we are looking at a case of what we call fumus persecutionis, that is to say, something which, in legal proceedings, gives the impression that something is going on other than the desire to see justice done in a dispassionate and normal fashion.
First of all, as the report points out, of the various people who could have had proceedings brought against them for the same alleged offences, Mr Cohn-Bendit is the only one who has been accused, something which I see as a criterion in itself.
Secondly, the lateness of the proceedings: they have been brought, arbitrarily, a long time after the alleged offences were committed. Clearly, the difficulty with this case relates to the fact that the offences of which Mr Cohn-Bendit is accused happened a long time before he took up office. It is precisely because these proceedings have been brought now he is an MEP that we should be asking questions.
Furthermore, this complaint - and I would add that I consider this a significant point - does not come from just any old person. It comes from a Member of Parliament who is an opponent of Mr Cohn-Bendit and who has used these accusations as one of the elements of his political battle. This is made abundantly clear by the victorious press articles and communiqués issued by this plaintiff just after the indictment or, should we say, the acceptance by the public prosecutor of his charges against Mr Cohn-Bendit.
I feel that all of this leads us to believe that if Mr Cohn-Bendit had not been a Member of Parliament, he would not have had proceedings brought against him. We are therefore dealing with a genuine case of fumus persecutionis, as the rapporteur has pointed out, and there is good reason to preserve Mr Cohn-Bendit's immunity.

MacCormick (Verts/ALE).
Mr President, there are some points I would like to underline in supporting what Mr Lehne said at the beginning of this debate. First, and most importantly, we are dealing with a matter of great public concern, but a matter that has been in the public domain for a long time. We are dealing with a course of events which Mr Cohn-Bendit has not merely not denied but has also publicly avowed. We are dealing with a course of events in respect of which Mr Cohn-Bendit was specifically praised by the trial court involved in the trial of Mr Klein some years ago, where the court drew attention to the courage and public spirit of the people who had assisted in getting that particular accused person to come out of hiding and give himself up to the public authorities. So this is not a case of somebody seeking surreptitiously to hide from accusations or from public justice, but of somebody who has openly avowed his actions.
Mr Lehne was absolutely right to say that there can be no question of the public prosecutors in Frankfurt being themselves in any way deviously motivated. They have a public duty to take up a complaint that has been laid before them on ostensibly justifiable grounds.
However, it does not follow that those who laid the accusation before the public prosecutors, thereby triggering that public duty, were themselves wholly lacking in any deviousness of motive. When account is taken of two aspects of the public interest here today - firstly, that there ought not to be unreasonable protection of MEPs or anybody else from public prosecution where circumstances warrant it and, secondly and importantly, that electoral debate and discussion should be able to go forward without unreasonable impediment or harassment of leading figures in it - the balance of the public interest in this case seems to be absolutely clear: the public prosecutors are doing their duty and we should do ours. In this case, that duty points clearly in the direction indicated by the Committee on Legal Affairs and the Internal Market to decline waiving the immunity.

Dell'Alba (NI).
Mr President, I have taken the floor to speak on this report because, at last, Parliament is taking into consideration the specific nature of the request made by the national authorities when addressing the issue of immunity. In the case of Mr Cohn-Bendit, we have decided not to waive immunity for a very specific reason, although, ultimately, it might have been in Mr Cohn-Bendit's interests for this trial to go ahead. For Parliament, on the other hand, the fact that the case has been raised many years after the alleged incident and that there could objectively be a suspicion or a suggestion that, behind this belated recognition by the German authorities of the possible guilt of Mr Cohn-Bendit, there might conceivably lie 'fumus persecutionis', justifies the stance taken by our committee, which I and my fellow Radical Members support. I am saying this in anticipation of other cases too, Mr President, for although it is true that in some countries we have reduced the scope of immunity, confining it strictly to the political activities of each Member of Parliament, it is also true that the scope of political activities cannot be limited solely to what is said in the Chamber, at least where those political and legal systems which provide for extensive immunity for Members of Parliament are concerned.
Until we have the single Statute for Members of the European Parliament, until Mr Rothley's line becomes law in our Union, I hope, from this point of view, that it will be precisely the examination of our texts which will prompt the Intergovernmental Conference to accept the idea that the Members' Statute should have a prominent place in the forthcoming European Constitution and specifically recommend that specific immunity and specific privileges be included in the Statute for Members of the European Parliament.
There is no doubt that the evidence in a case which indicates the political nature of an act can fall down, whether in this or in future cases. For example, as you know, you will soon be called upon to deal with the case of Mr Dupuis, who handed out doses of hashish as a way of condemning Italian legislation on drugs, which will lead to the opening of a case.
In conclusion, Mr President, I support the line taken by Mr MacCormick, and I believe that, in acting in this way, Parliament will be setting a precedent for subsequent cases.

President.
The debate is closed.
The vote will be tomorrow at noon.

President.
The next item is the report (A5-0243/2003) by Neil MacCormick, on behalf of the Committee on Legal Affairs and the Internal Market, on the request for waiver of the immunity of Mogens N.J. Camre (2002/2249(IMM)).

MacCormick (Verts/ALE)
Mr President, this is one of those cases concerning the immunity of a Member of Parliament which raises in a very sharp form the issue of the immunity or non-immunity of Members when they are indulging in political activity outside Parliament. It is very clear law that expressions of opinions or votes cast in this House can never be the subject of legal action or prosecution anywhere. That is an essential part of the liberty of discussion in a democratic assembly.
However, in the course of their duties, Members of this House often indulge in political speech and political activity elsewhere, most particularly in their own constituencies and in their home state - for example at party congresses. The case we have before us concerning Mr Camre arises from a speech at his party congress in Denmark in 2001, shortly after the desperate events of 11 September.
In the course of a speech to his party congress, Mr Camre made some very strong and, in my personal judgment, highly offensive remarks about Muslims living in the West. All the countries of the West, he said, are infiltrated by Muslims and some of them speak nicely to us while they are waiting to become sufficiently numerous to get rid of us, as they have done in Sudan, Indonesia, Nigeria and the Balkans. There are other similar or even more unpleasant remarks.
Under Danish criminal law, section 226 b of the Danish Criminal Code, it is an offence to make statements constituting derisory and humiliating treatment of a group of people. In this case the accusation is that the statements made were derisory and humiliating treatment of people in Denmark, namely people of Muslim belief or family background.
Under European law, the position is that a Member of this House, acting in his home state, enjoys the same immunity from prosecution and legal intervention as would a Member of the home parliament. Under the Danish constitution, a Member accused of a criminal offence such as this enjoys immunity from prosecution unless the Folketing - the parliament - waives that immunity.
We are informed that normally the Folketing would waive immunity in a case of this kind. However, the European Parliament has always rightly said that we must have a common set of principles concerning the waiver of immunity that apply to all MEPs in all countries. Therefore, the issue is not would the Danish Parliament waive immunity? but ought this Parliament to waive immunity in a case of this kind? where the words complained of are certainly to any ordinary judgment very offensive - to put it mildly - but where they are also unquestionably statements made in the course of a political activity.
The Committee on Legal Affairs and the Internal Market instructed me - rightly - to look into the whole range of the precedents, the decisions that this House has taken about immunity in these sorts of situations. It became clear to the officials who looked into it, and myself, that Parliament has a universal practice of declining to waive immunity in the context of prosecutions where what is involved is a prosecution of matters which are directly the content of a Member's political activity.
That being so, while I have to say that I myself have extreme disgust for the remarks that were made, I consider it to be my duty as rapporteur, and in any event it is the unanimous opinion of the Legal Affairs Committee, that in this case the Parliament ought to inform the Danish authorities that it declines to waive the immunity of Mr Camre and I so recommend.
I must say, as I reviewed the case law, it did seem to me personally - and this is a purely personal opinion - that it might be that over the years we have cast the net of parliamentary immunity rather wide. It would not be appropriate or just to use an individual case arbitrarily to change the practice, but it might be worth the Committee on Constitutional Affairs reviewing the question of how far we ought to expect parliamentary immunity to extend, how far we should wish it to. I believe it would be appropriate for the Constitutional Affairs Committee to consider this if in due course it were invited to do so. But that is a separate issue. There is no doubt that the required course of justice in upholding the long-standing principles and case law of this Parliament is to decline to waive immunity in this case.

Lehne (PPE-DE).
Mr President, ladies and gentlemen, I share Mr MacCormick's view. Mr Camre's utterances, which are at issue here, are surely utterly unacceptable and intolerable, nor could they ever enjoy anyone's political support. That, however, is not what this was about. This was simply about the question as to whether this is one of those instances - to be found in previous exemplary cases - in which we have, in the past, come to the decision that a Member's freedom of speech is inseparable from his duties as an MEP, that is to say, from his mandate. Mr Camre came out with these utterances at his party conference in Denmark, and this is a quite classic case in which we must assume that he was acting in connection with his mandate as an MEP. I might add that Mr MacCormick's report, as well as the opinion that our secretariat has been so kind as to draw up, clearly show that this is the decision we came to in the past. I believe that this House is also under a self-imposed obligation to continue to come to similar decisions, most especially when it is obvious that political activities are concerned.
Apart from that, the different ways in which each Member State deals with these things will, in the long term, only be resolved if - as Mr Rothley has mentioned in his report - a single European immunity law is soon on the way. It is the Council that holds the key to this. Let the Council simply adopt our statute. The Council would also be making a great contribution to progress if it were to give some thought, perhaps in the course of the forthcoming Intergovernmental Conference, as to whether it might be appropriate and possible, in line with our resolutions, to amend the Protocol on Privileges and Immunities as part of the new Treaty provisions.

Zimeray (PSE).
Mr President, I also agree with the rapporteur's conclusions, though more the conclusions than the analysis which leads to them, since I believe Mr Camre's immunity should not be lifted.
I would, however, like to make two or three observations: firstly, that I share - as others have said - the distaste which I believe we all feel at the nature of the opinions expressed by Mr Camre. However, I believe that it is our duty and a matter of our honour not to take them into account.
It is true that for several years a tendency has emerged within the Committee on Legal Affairs and the Internal Market and more generally in this Parliament, aimed at protecting MEPs' opinions or the MEPs against whom proceedings are brought as a result of opinions or attitudes which may arise from a political point of view, in the broadest possible sense.
I believe we must defend this tendency and affirm it; that is what this report must do. It must be affirmed in this report and in others, all the more so because while Members of Parliament have particular responsibilities, one would have to be blind not to observe that they are also exposed in a particular way. We must take account of this exposure and the risk it poses to prominent figures in public life today: the almost systematic challenging of the responsibilities of local elected representatives and the no less systematic legal action against Members of Parliament as a result of the opinions they may express. I believe we must take account of this development and protect the Members of Parliament, not really in order to protect the individuals, but rather the institution, its independence and its freedom.
At a time when we find ourselves increasingly in a democracy of opinion, it is essential that we take measures to allow Members of Parliament to express themselves freely and to make their opinions known free from pressure, including pressure of a legal nature. This is the approach which has been taken by the Committee on Legal Affairs and by this report. That, I repeat, is why I agree with this request to preserve Mr Camre's immunity, regardless of the reservations, regardless of the distaste we feel for the opinions of the Member.

President.
The debate is closed.
The vote will be tomorrow at noon.

President.
The next item is the report (A5-0248/2003) by François Zimeray, on behalf of the Committee on Legal Affairs and the Internal Market, on the request for upholding of the immunity and privileges of Mr Francesco Musotto (2002/2201(IMM)).

Zimeray (PSE)
 rapporteur. (FR) Mr President, this case gave rise to very long debates and a certain number of changes of heart within the Committee on Legal Affairs and the Internal Market, before a unanimous position could be reached. These changes of heart are linked to the singular character of this case. As in the previous case, we are faced with a situation in which freedom of expression is at stake.
An action has been brought against Mr Musotto in connection with certain remarks he made to Italian television just after his election by universal suffrage, but before the beginning of the Parliamentary session. The problem is, therefore, that, according to the letter of the treaties, he was not a 'proper' Member of Parliament at the moment he made his feelings known.
This strict interpretation - restrictive, even - would lead us to waive the immunity of an individual who was not a Member of this House at the moment in question. This solution may be pure in legal terms. It is morally and legally profoundly shocking, however, for in legal matters one must consider not only the letter of the law, but the spirit as well. With this in mind, there can be no doubt that, when he was interviewed by the press, Mr Musotto was already considered to be a Member of Parliament, since, when the journalist spoke to him, he prefaced his question with Mr Musotto's Parliamentary title. It is thus indisputable that Mr Musotto was interviewed in his capacity as a Member of Parliament. He also gave his answers in that capacity, and it seems to me that any result which threatened to waive his immunity, or which threatened not to uphold his immunity, would go against the spirit, if not the letter, of the law. That is the unanimous opinion reached by the Committee on Legal Affairs in the course of lengthy debates.
As the rapporteur has already stated in a previous case, interpretations of national law must be set to one side where the freedoms of thought and expression are involved. Whatever Mr Musotto may have said, we should uphold his Parliamentary immunity at all costs: the independence of our institution is at stake. I agree that it is harmful to be overly reliant on national laws. In the case in point, it would seem that Italian law grants immunity to anyone who has just been elected by universal suffrage. By interpreting the treaties generously, the Committee on Legal Affairs has acted with great wisdom, courage and consistency, since its stance is directly in line with previous decisions taken in analogous situations.
We have nevertheless incorporated into the conclusions to our report a suggestion that the Convention and the next Intergovernmental Conference correct this textual anomaly by amending Article 3 of the Act of 1976. Such a revision would allow optimal protection of Members, guaranteeing them real freedom of expression and filling the existing legal vacuum. Finally, it would make the beginning of the mandate and the proclamation of the results of elections to the European Parliament coincide in time. The letter and spirit of the treaties would thus be reconciled.
That, Mr President, ladies and gentlemen, is why I recommend that Mr Musotto's immunity should be upheld.

Zappalà (PPE-DE).
Mr President, as a member of the Committee on Legal Affairs and the Internal Market, I fully agree, of course, with what the rapporteur has just said. I would, however, like to point out to you, Mr President, and to the House, a further consideration which the rapporteur, not being of Italian origin, was not able to highlight. Mr Musotto is already on trial in Italy for this incident. In this situation, and in many similar situations too, a principle is being overlooked inasmuch as we take as a basis - or some people do - the erroneous interpretation of what is, in actual fact, the law. The Treaties lay down that we are all subject on national territory to the laws, and therefore the immunities, which apply to the national parliaments. In our case, however, we are not taking into account - or someone, in Mr Musotto's case, has not taken into account, and that is why I am pointing it out, Mr President - the fact that the immunity granted to the European Parliament - not to its Members but to Parliament itself - is, in any case, completely independent of national arrangements. No one - neither the Court nor the Public Prosecution Department which has opened the proceedings relating to Mr Musotto - has applied to the European Parliament for authorisation: there has been no request or notification. Mr Musotto has had to make the request and inform us of his situation himself; the Presidency and the Committee on Legal Affairs have expressed an opinion and the opinion will now, with tomorrow's vote, provided that it is still in line with the Committee on Legal Affairs' proposal, become a Parliamentary document.
Mr President, it is essential that the outcome of tomorrow's vote is enforced outside this House too, where the Public Prosecution Department in question is concerned, for it is essential not just that it is clear to everybody but - seeing as so much hangs on that word 'immunity' in my country - that it is enforced as a general principle as well as in the case in point. Parliament is autonomous, and this has been practice and consolidated case law since Parliament was first established, since Parliament was elected by universal suffrage: too many people forget this. I therefore ask, Mr President, not just for the House's decision to be communicated to those to whom it directly relates but for a clear, precise, unambiguous principle to be established, which, thus far, has certainly not been followed by certain courts.

President.
The debate is closed.
The vote will be tomorrow at noon.

President.
The next item is the recommendation for second reading (A5-0218/2003) by the Committee on Economic and Monetary Affairs, on the Council common position with a view to adopting a European Parliament and Council directive on the prospectus to be published when securities are offered to the public or admitted to trading (5390/4/2003 - C5-0143/2003 - 2001/0117(COD)) (Rapporteur: Christopher Huhne).

Huhne (ELDR)
Mr President, this is not quite as dry or as difficult as the title makes it sound.
I wish to begin by thanking my colleagues on the Committee on Economic and Monetary Affairs for their hard work on the amendments on the prospectus directive. I also wish to thank the Commission for the important facilitating role it has played in reaching what I hope will be an agreed set of amendments when they are voted on Wednesday, and to thank the Greek Presidency - and before that the Danish Presidency - for the preparation of this particular dossier. I hope we will have an overwhelming vote in favour of the compromise amendments, with the agreement of the Council, and that we will therefore have a prospectus directive later in July when the Ecofin Council meets again.
This is a key part of the Financial Services Action Plan and of creating a single market in financial services. Instead of having to use 15 separate prospectuses to reach retail investors in the existing European Union, in future an issuer of bonds or shares will only need one. That will give a passport not just to 15 Member States but to 25 and a market of more than 400 million people. The single European market in new issues of shares and bonds is set to become a reality. This will lead to more competition and, therefore, greater choice for investors, cheaper capital for businesses, and more funding opportunities for many businesses that might be denied finance if they were limited to their national market.
Moreover, this key advantage - a single passport - has been achieved without some of the less felicitous baggage that was originally contained in a somewhat rushed proposal from the Commission and that would have added to the regulatory burdens, particularly on smaller listed companies. This deal ensures that there is no mandatory shelf registration and that there is no mandatory annual updating, unless the issuer intends to continue issuing shares or bonds. This is a significant achievement for this Parliament in influencing the final shape of this legislation.
Crucially this agreement also confirms the freedom that issuers of bonds have to go to different EU regulators for the approval of their prospectus, so long as the minimum denomination is EUR 1000 or more or, importantly, a nearly equivalent amount in other currencies, so that USD 1000 can also be a minimum amount.
The euro markets raised USD 1.6 trillion equivalent of finance for business last year and 60% of that finance was in non-euro currencies such as the dollar and the yen. Europe is the proud home of the international capital market and this deal now gives that international market a way of bringing its benefits across to domestic investors too.
The Council and the Commission have accepted the vast majority of the amendments passed by Parliament at its first reading in March 2002: on the choice of EU regulator for bonds, on a light touch for small and medium-sized businesses, on tailoring requirements to different issues, on lightening the burden on issues. Thanks to Parliament's insistence we have also reached compromise on the ability of national authorities to delegate approval of prospectuses to stock exchanges and others such as the nominated advisors in the aim market. There will be a review after five years and the Commission may reconsider the commitment to phasing out delegation after eight years. The political declaration from the Commission is important and it shows an open-mindedness faced with the evidence, which we would obviously expect.
We have also made clear that both national authorities and stock exchanges may continue to insist on higher standards of disclosure and corporate governance as a requirement of listing, if they so wish. This should put some fears to rest.
As regards the last-minute changes that were agreed only last week by the Council, we have also clarified that existing medium-term note programmes, a very important type of financing structure in the euro markets, can continue unchanged. Indeed they will now be extended beyond the four Member States which currently recognise them and will also benefit from the passport. This is a real breakthrough for the single market and this House can be proud of its influence in ensuring that the directive is an effective means of extending competition, choice and efficiency.

Bolkestein
. Mr President, I wish to begin by saying that this directive is fundamental for the functioning of primary markets in Europe and for our aim to build an integrated capital market by 2005. For the Commission, the prospectus proposal has two aims: to facilitate fund-raising for European issuers and to ensure adequate levels of investor protection.
During the past two years this text has evolved significantly. There have been some important changes but the text maintains the necessary balance between facilitating for issuers and investor protection.
The Commission amended its proposal to take account of Parliament's position. After first reading, 50 out of 62 amendments were taken on board by the Commission in its amended proposal. The Council's common position is broadly in line with this amended proposal.
Today I should like to congratulate Parliament on its spirit of collaboration and its willingness to achieve convergence. We welcome the new amendments tabled by the rapporteur, together with the following Members of Parliament: Mrs Kauppi, Mr Ettl, Mr Goebbels and Mr Blokland. I am very optimistic that they will be accepted also by the Council.
I much appreciate Parliament's constructive spirit and I should like in particular to pay tribute to the rapporteur, Mr Huhne, for all his work to get approval for this compromise proposal. In particular I should like to thank him for his report and for the 21 new amendments he has tabled. We can accept them in their entirety, as we consider that they improve the text of the common position and contribute towards achieving the goals set by the proposal. In this context, we reject the first 47 amendments tabled, since those which could be accepted - even partially or in spirit - by the Commission are now covered by the 21 new amendments.
Regarding more particularly Amendment Nos 50 and 67, related to delegation of tasks from a competent authority to an exchange, I confirm that the Commission in the review to be conducted in accordance with Article 21 will also examine the conditions relating to the sunset period in the same article.
The Commission cannot accept Amendment Nos 69 to 71 since they provide for preferential treatment with respect to banks, and this is against the philosophy of the directive. Such treatment would create discrimination towards other institutions and distort competition. That is something the Commission objects to.
Finally, I should like to thank the Greek presidency for its most valuable efforts to reach agreement on this matter now. It is an important and highly significant achievement. We must now use our remaining energy reserves to resolve the investment services, transparency and, of course, take-overs directives by the April 2004 deadline.

Karas (PPE-DE).
Mr President, Commissioner, Mr Huhne, ladies and gentlemen, I would like to start by giving Mrs Kauppi's apologies. She regrets that her flight cannot get her here yet, and so she has asked me to stand in for her.
We know that this directive is an important part of the financial services action plan. What are this action plan's strategic objectives for the financial internal market? The first is that a single wholesale market for financial services should be guaranteed; the second is the creation of open and safe retail markets, and the third is the modernisation of the rules of compliance and of the way in which they are monitored.
What is today's debate about? Today we are debating the prospectus to be published when securities are offered to the public or admitted to trading. What do we mean by a prospectus? By that we mean a document published when shares or bonds are issued, containing those items of information considered necessary to investors. What does the directive aim at? It aims to introduce a single passport for prospectuses, approved by the authorities in the country of origin and subsequently recognised throughout the EU for the purposes of the public offering of securities and/or their admission to trading on regulated markets. In place of the fifteen separate authorisations still required despite two directives on the subject, only one authorisation will be required under the new directive for what will be the twenty-five Member States of the European Union.
I would like to extend very warm thanks to the rapporteur, to the shadow rapporteurs of all the groups, and also to the chairman of the committee, for the great deal of time and effort that they have devoted to this. Last Thursday, when we were in a conference call, we were in fact even more divided, but it was possible, on the Friday, for us to make a conciliation committee unnecessary; I think this right and proper, as we have no idea whether the conciliation committee would have enabled us to make any progress or might indeed have jeopardised this important directive.
The six major successes achieved by Parliament mean that we can say yes to the compromise. As early as first reading stage, we managed to add the sunset clause to the Lamfalussy procedure, to produce a better definition of professional investors and to take greater account of small and medium-sized firms. At second reading stage, and in recent days, we succeeded in getting a free choice of supervisory authority for non-dividend-bearing securities with a denomination per unit of at least EUR 1 000, which amounts, de facto, to a free choice of supervisory authority. We managed to get the deadlines for authorisation reduced; it is still possible for supervisory authorities to delegate; and the position will be reviewed after five years. If, though, the Commission's report after these five years is an unfavourable one - which I do not expect it will be - the option of delegation will have to lapse after eight years, so that, here too, we have improved the Common Position along the lines desired by Parliament.
This does not mean that everything has been sorted out. It is a cause of anguish to me that there are two things that have not been achieved. One is a rule on basic prospectuses for all banks issuing shares, for which I campaigned. Here - as is, indeed, stated in the recitals - it was not possible to do justice to the aim of this directive, that being to speed the process up. The directive has rather missed the mark here. The second thing that did not get through - although this was adopted with the support of all groups in this House - was the increase in maximum value for each issuer from EUR 50 to EUR 100, in respect of which exceptions are possible. That would have been a help especially for states such as Austria and Germany, where no prospectus is at present required below this threshold. Although it is unfortunate that we did not succeed in this, the compromise is, all in all, a good one, and we will therefore be supporting it.

Ettl (PSE).
Mr President, it really does take a lot of self-restraint, following this overture by Mr Huhne and Commissioner Bolkestein, not to let a note of discord disturb their duet. It falls to me, in any case, to congratulate the rapporteur on his work, even if - as far as the outcome is concerned - I do not entirely share his opinion.
The directive on prospectuses for securities forms, without any doubt, an important part of the financial services action plan. If they are to obtain finance on the capital market, businesses need these reliefs, which they had expected. As we are also dealing with this matter under some pressure of time, I would be the last to want this issue to go to a conciliation committee. We - that is, the Economic Affairs Committee - believe that conciliation under Italian aegis could not bring about any fundamental improvements to the status quo. It is still the case - and we are to vote on this as soon as tomorrow - that countries such as Italy, Spain, and France too, have certain reservations as regards points of detail in the European prospectus, about which you will hear more later.
I believe that, yet again, the Council and the Commission, in discussions on what is a typical codecision issue, are showing themselves to take a less flexible approach to this elementary question of financial markets than this House might have been able to expect. Our approach and our thinking were in every respect guided by the practice of the market, so that, if I am able to recommend approval of this second-reading compromise, it is more on the basis of the general weighing of the interests involved.
To be able to provide one single information document valid throughout the EU is, though, surely to the advantage of businesses that introduce shares, or make offers to buy, on European stock exchanges. It is obvious, though, that, in dealing with this matter, we have to consider the transparency of securities markets and, to an increasing extent, the protection of small investors and small and medium-sized enterprises. A procedure that is as simple and cheap as possible when it comes to the amount of an enterprise's data that are required and the way in which they are to be updated, is meant to make for easier access to capital markets. That is what we need. To some extent - or almost exclusively - we have done justice to this, but our desire to extend, on the basis of liability, protection of small investors by defining responsibilities more clearly - with reference, for example, to analysts or chief accountants - has, unfortunately, met with rejection. Equally unfortunately, the issue of the venue of jurisdiction has found no clear resolution. Issuers were allowed to have recourse to the courts in their own countries, an advantage denied to investors. This may well continue to be a live issue. It is unfortunate that this immovability, which was not necessary in this case, has resulted in no further progress in the issues in the financial services sector that the public really care about.
Nor were the prevailing customary practices on European markets followed when it came to convertible debentures. Had these been unambiguously defined, as had indeed been proposed, quality improvements would have followed, because, for example, the right to convert would have gone to the owner of the securities. This is also highly significant in terms of Basle II, as this type of financial instrument is likely to become more popular.
It baffles me, Commissioner, how a minimum framework of information for regional and local authorities presenting prospectuses for loans in all the EU's Member States, could come to be regarded as a hindrance rather than as a good thing. A measure of this sort would be of additional value in view of the EU's enlargement. I regard that as regrettable, but at least other points were accepted, among them the choice of a minimum nominal value of EUR 1 000 or USD 1 000 - now determined by reference to the market - for all loans. The temporary solution of eight years - with the office authorising the prospectus allowing certain tasks to be delegated to the stock exchanges - is of no small significance to smaller financial markets and is a good way of dealing with this.
Last but not least, we can go along with what has been negotiated. Congratulations to the rapporteur, and no clashing discords to the Commissioner.

Patakis (GUE/NGL).
Mr President, the proposed arrangements have a dual purpose. First, to restore the shaken climate of confidence of small working-class investors in the institution of the stock exchange, so that grass-roots savings can continue to be plundered unimpeded and, secondly, to set up a regulatory framework for the action of the big investors. In other words, the aim is to consolidate the stock exchange as a mechanism for concentrating capital and safeguarding a quick, easy profit for monopoly groups.
The proposals for measures to be taken are not at all convincing. In its communication, the Commission talks of practices which will improve the reliability of the market and help to attract capital, in other words, they will allay the fears of small investors so that they can plunder their savings with impunity. Having succeeded in sweetening them with a taste of the profits so that they gamble all their savings, by applying the idea of easy money, they have also managed to turn their heads by inciting them to raise gambling to an art form. So far, not only have no substantial control measures been taken, but also recent repeated scandals have revealed that even these very control mechanisms have advocated cheating by adopting creative accounting methods, and as a result the savings of the working classes, the capital of small investors and pension funds have grown wings and flown into the coffers of the monopoly groups, which grow rich in this parasitical manner.
The history to date of the stock exchange and of the control mechanisms relating to it show that it is the place where 'big fish eats little fish' applies absolutely. The myth that state controls can limit speculation in the very temple of speculation has now been exposed. Only an economic and political way out that puts grass-roots needs first and socialises the basic means of production constitutes a promising prospect for safeguarding grass-roots incomes today.

Villiers (PPE-DE).
Mr President, Commissioner Bolkestein put the history of this debate in just a few words with his usual aplomb. He said that the text has evolved considerably since the Commission first published it. That reflects in a very understated way the radical changes we have seen to this proposal, due in large part to the efforts made by this House. Those changes have the full support of my group and the British Conservative delegation within it.
We have campaigned from the start to end the requirement for mandatory, annual shelf registration. We are delighted to see that is one of the 50 of 62 amendments which were accepted by the Commission and the Council. This requirement could have imposed millions of pounds and euros' worth of costs on businesses large and small across the European Union. The original proposal from the Commission could have devastated Europe's small-business stock markets such as Aim markets. The changes we have seen as a result of Parliament's efforts are extremely welcome and have considerably improved the proposal.
We have also been campaigning for a suitable framework to cover bonds. It was a concern at the early stages of the text that a 'one size fits all' framework designed for equities was being imposed on the bond markets. Again, we are very pleased to see that the bond market is going to be given distinctive treatment, which reflects the differences between the bonds and the securities market.
We fundamentally support the idea of issuer choice. Giving issuers the maximum facility and flexibility in choosing a jurisdiction is one of the best ways to facilitate genuine cross-border trade and genuine integration of our capital markets. We can accept the compromise on this point, though my delegation and probably the group as well would have liked to have been more radical in this area and given issuers a wider choice; in particular, we would have liked to have seen issuer choice and flexibility in relation to equities.
Certainly we are delighted to see the flexibility that has been introduced for the bond market. There is issuer choice in the bond markets at the moment and that has contributed to integration of the markets and a building up of specialist regulatory expertise in particular jurisdictions. To require all issuers of bonds to issue in their home Member States would have been a retrograde step in creating an integrated capital market.
We are also very concerned to ensure that the language regime cannot be used to protect markets. That was the key flaw in the existing prospectus directive and again we are very pleased at the development of the text. We are now confident that the language regime is acceptable again. We would have liked something a little more radical, but I think there are safeguards which will prevent the difficulties we have seen with the current prospectus directive and make it much more difficult for language to be used to protect national markets.
I am also pleased that the scare about the threat to corporate government standards has been dispelled. It is now quite clear that the prospectus directive will not prevent Member States from imposing the high corporate government standards that exist in many places, for example in the United Kingdom.
This debate is also an illustration of the importance of the Commission carrying out extensive consultation in advance of publishing its proposals. The prospectus directive was published without much extensive consultation and it has taken us longer to resolve the issues as a result. I am pleased that the Commission in its subsequent proposals has consulted more extensively and effectively before publication. I hope that is the attitude it will take in the future.

Berès (PSE).
Mr President, Commissioner, ladies and gentlemen, the report being debated today is vital for harmonising financial markets, since it will allow securities to be quoted on the stock exchange lists of all European markets. It is also vital, however, as it guarantees a uniform standard of information. This is necessary if markets are to be transparent and secure, and therefore if they are to function properly. This report also sets out to guarantee that all parties are given full information on the securities quoted.
There is no doubt that the Greek Presidency's compromise represents a laudable balance which allows the different European approaches to market regulation to be reconciled. When I hear my fellow Member from Britain make the case for the language regime, however, a flicker of suspicion stirs within me. For while I can understand that a Dutchman, a Frenchman or an Italian might make the case for a language regime which is not designed to protect markets, I imagine a different concept of market protection when I hear it from the mouth of a Londoner.
More seriously, at this stage in the Parliamentary process, I would like to discuss two matters which, I feel, are not minor details but remain pressing questions. The first is the choice of competent authority for convertible bonds, by which I basically mean Eurobonds. I feel that if we leave the choice of competent authority to companies, we encourage the lowest-bidding regulator. The issuing companies will naturally gravitate towards the least parsimonious authorities. We therefore risk weakening the markets. I accept the distinction established between debt and capital. Small investors, indeed, are not concerned with bonds. We can thus tolerate a lesser degree of rigour. On the other hand, I find it unacceptable to admit free choice for bonds. They allow access to a company's capital and are one of the two forms of new equity issue. Moreover, these equities are liable to be held by the public, and this will increasingly be the case in future. On this point, the Presidency's compromise appears satisfactory.
The second problem is the delegation of powers by the authority. In the Member States where such delegation exists, the stock exchanges to which these tasks are delegated have very often become private profit-making organisations. They are thus de facto both judge and judged after the prospectuses have been inspected. That poses undeniable problems relating to the quality of scrutiny of the prospectus and possible distortions of competition. I feel that the eight-year period allowed in the Presidency's package for the Member States to come into line with this reality of business life really is the longest acceptable time limit. It should allow us to put an end to this type of delegation. These two questions remain pressing. A few other details might be worth mentioning here: the possibility of SMEs or natural persons considered as qualified investors opting out of this statute; the fact that if a competent authority has not scrutinised a prospectus within the prescribed time limit, that prospectus is approved; the problem of languages, which I have mentioned briefly.
To sum up, Mr President, I hope that Parliament votes in favour of the Greek Presidency's compromise, a solution which is acceptable to all concerned.

Lulling (PPE-DE).
Mr President, I very much welcome the prospectus directive that is before us. Its importance lies in its regulation of the issue of European Passports for the prospectuses, which will enable securities to be marketed right across the European Union's internal market. If a prospectus is authorised by a competent national authority, this authorisation will, as we know, be valid in all other Member States. This means that the European Passport will save the issuers a lot of expense and administrative effort.
As I have already said, this directive is one of the most important components of the Commission's action plan, which aims to establish an internal market in the area of financial services. In December 2002, the Commission estimated that the creation of an efficient internal market in securities would result in a 1.1% growth in gross domestic product. I hope they are right in saying this, as we could all do with a spurt of growth under present circumstances.
The recommendation for second reading, as presented to plenary, is a fine document. I would like to express my congratulations to the rapporteur, Mr Huhne, as the text improves two important aspects of the Common Position about which I am personally concerned. One is that this text allows the issuers, from a denomination per unit of EUR 1 000 and upwards, to choose, when it comes to the approval of the prospectus, between, firstly, the competent authority of the Member State in which the issuer's registered office is situated; secondly, that of the Member State in which the securities are authorised to be traded on a regulated market; or, thirdly, that of the Member State in which the securities are offered to the public. Having EUR 1 000 as the denomination per unit is far more realistic than the threshold value of EUR 5 000 estimated by the Council, as it will be small investors that will have a particular interest in it. So I am very much in favour of this and hope that it will not be watered down still further. I am given to understand that it still stands even after the compromise with the Council.
Secondly, this text allows the competent authorities to delegate the examination of the prospectus to other bodies possessing the necessary expertise. In small Member States in particular - both present and future ones - the tradition is that prospectuses are examined by the stock exchanges. Responsibility remains, of course with the competent state authorities, whilst stock exchanges do have the necessary highly-qualified staff. In Luxembourg, we had great difficulties finding experts with Luxembourg nationality, as the officials of the supervisory authorities have to be Luxembourg nationals, so I am glad that this delegation does not lapse after five years, but will be checked by the Commission to see if it still works. Rather than sharing Mrs Berès' view, I am convinced that this examination will not produce adverse judgments; we will not end up, after eight years, with a delegation of this sort becoming inevitably impossible.
I very much want to underline once more how significant this directive is, and I am glad that Commissioner Bolkestein has told us that he can go along with the twenty-one compromise amendments on which the rapporteur and the Commission have agreed. I would again like to thank Mr Huhne most warmly for the work he has done, which has been of real value, and for his sympathetic attitude, particularly to the concerns that I raised and which, it is to be hoped, will soon be dealt with in the way I have described. If that happens, we will soon have a proper directive, one that will be of great importance to the smooth functioning of the internal market.

Skinner (PSE).
Mr President, if compromise is about being able to live with views which are not entirely your own then the rapporteur has done tremendously well in terms of handling the debate within the House and within the committee, with the Commission and with the Council. He certainly listened to his colleagues and I congratulate him for his sensitivity.
As Mr Ettl said, raising capital is vital, and it is more vital perhaps for small businesses where delicate problems can cause immense harm. The protection of businesses from disproportionate costs is surely vital and the attempt which has been made to steer this text towards a more balanced approach effects what I believe is the long-term security for this market. An obvious example, which was mentioned by Mrs Villiers, is on shelf registration, which could have caused tremendous harm and has been avoided. I also fought hard against this. I believe that is a great success.
I would also like to mention, rather than going into the details which have been repeated so much, the risk capital action plan of which this is a part as well, and I am always keen to make sure we cross-reference. It is part of the Lisbon goals for growth for all our economies. The single market helps create the potential for such growth. As a past rapporteur on the risk capital action plan, I am pleased to see it has completed its passage through this House and I am pleased that it has been completed successfully so far.
As the Commissioner says, there are other reports to come and I hope that they will reflect the same level of debate that we have heard for this particular report. It was not perfect when it reached this House - very rarely things are of course, which allows us to stay in the job we are in - and I believe that Parliament has handled it supremely well and this demonstrates the maturity which it can lend to such technical reports.
I look forward therefore to our discussion on the transparency directive, which, as you now know, has been given to the Committee on Economic and Monetary Affairs. As the rapporteur I look forward to a very vital debate, as we will expect for the completion of the financial services action plan that this directive will be pointed at as well.

Bourlanges (PPE-DE).
Mr President, I shall add my voice to those of my fellow Members who have congratulated Mr Huhne on the undeniably high quality of his report and on his feeling for compromise. If the report is adopted, these qualities will allow decisive progress to be made in one important aspect of the unification of financial markets.
Indeed, I believe that all of us here are convinced of the advantage of making swift progress and bringing this to a speedy conclusion, avoiding a set of conciliation proceedings desired by nobody. Conciliation is what remains when compromise has failed, and, as a matter of fact, I feel that the compromise we have reached is relatively satisfactory. It is not perfect for anybody, but it does not damage anybody's interests, and therefore constitutes a promising starting point.
We had several problems, but we have obtained a satisfactory result in terms of the choice of competent authority. That is a victory for Parliament. I believe that this is a cause of which the rapporteur was a great supporter, and he has won the day. Our worries related, first of all, to the conditions of issue of the passports and the time limit for dispatching them. It was necessary to find a balance between, on the one hand, the swiftness required by organisations wishing to invest and, on the other, the thoroughness with which their applications should be scrutinised by the competent authority. On this point, the compromise is satisfactory. The matter of the language regime was equally irksome for us. It is of the essence that everyone should understand what is at issue here. The common position may be less than perfect, but I feel that it does offer sufficient safeguards.
The competent authority's delegation of certain tasks to a more technical agency awoke intense worries within my group, relating to what I will term 'Lamfalussism' run riot. By this I refer to the phenomenon of being induced to entrust activities of almost regulatory dimensions to technical, specialised agencies, lacking in transparency and subject to minimal controls. It was vital to establish a time limit after which this type of delegation would no longer be possible. The committee's report allowed for no such thing, but the compromise does. It establishes eight years as the term for this possibility. That is a long time, but at least we can be sure that, when it has elapsed, the possibility for this type of delegation will have expired. I believe this is a very good thing.
Finally, there was the matter of convertible bonds. Should convertible bonds be treated as equity securities? On this point, the compromise relinquishes a committee vote which we found unsatisfactory, for convertible bonds should be treated as equity securities. We are fully reassured on this important point. That, Mr President, is why I believe that we should all vote in favour of these amendments and adopt the proposed compromise. Mr Turchi's amendments will remain on the table. They are interesting, of course; but they open a Pandora's box rather than a debate. These are intelligent amendments, but since they cast doubt on many aspects of the definition of securities, it is better to close Pandora's box once more so as to obtain a sound decision quickly, as the rapporteur hopes and as our group desires.

Randzio-Plath (PSE).
Mr President, there is no doubt that the European Passport for issues of securities will, in future, make it easier to raise capital. This proposal is one of our contributions to the removal of bureaucracy and of the other barriers that mean that a financial internal market is still not yet feasible. I have to say that there has been very constructive cooperation between the institutions, and this has been made easier by the rapporteur's willingness to compromise; we have all had to agree on formulations in order to produce a watertight piece of legislation.
I think it was a great stroke of genius for us to draw a distinction between equity and non-equity securities. That was a smart move, for which I am sure that, one day, both investors and issuers will be grateful to us. When we do actually adopt a directive, it will be important for us always to attempt to balance the interests of the issuers and those of investors. In this directive, this House has again attached great value to the protection of small investors, who have in recent years been particularly unsettled, and we are obliged to restore small investors' confidence if we really do want to have a properly-functioning internal financial market from which everyone can benefit.
The three things that are important are, firstly, that every investor will in future be able to rely on the prospectus underlying an issue complying with high standards of quality, without regard to the issuer's home country and also without reference to the country in which the security is offered. This will become a selling point. The second is that, in the course of negotiations, we were able to make it a requirement that the summary prospectus, which is the main source of information for small investors, should comply with high standards and form part of the prospectus. If the summary is false, misleading or inconsistent, it must be possible, in consequence of this, for those responsible to be brought to account. Thirdly, the investor is protected against misleading advertising, in that it is ensured that issuers, when describing their product in the media, cannot promise more than the security can hold in accordance with the prospectus.
In conclusion, I would like to mention one concern that again became very apparent when this directive was under discussion, and that is the question of whether Parliament's rights have actually been safeguarded. If I consider the Interinstitutional Agreement in the light of better regulation, I have my doubts about this, so you can be sure that we will consider very carefully whether the work that you and CESAR do on this particular directive meets our expectations and is within the framework we have set. If you were to fully meet Parliament's expectations, that would build confidence in the legislation to be derived from this in future, and in secondary legislation.

President.
The debate is closed.
The vote will be on Wednesday.

President.
The next item is the joint debate on public markets:
Recommendation for second reading (A5-0242/2003) by the Committee on Legal Affairs and the Internal Market, on the Council common position with a view to adopting a European Parliament and Council directive on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (11029/3/2002 - C5-0141/2003 - 2000/0115(COD)) (Rapporteur: Stefano Zappalà)
and
Recommendation for second reading (A5-0245/2003) by the Committee on Legal Affairs and the Internal Market, on the Council common position with a view to adopting a European Parliament and Council directive coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors (12634/3/2002 - C5-0142/2003 - 2000/0117(COD)) (Rapporteur: Stefano Zappalà).

Zappalà (PPE-DE)
. (IT) Mr President, we are addressing in this part-session - the vote is to be held on Wednesday - a reform which, because of the interest it has raised and the debate it has prompted, is certainly one of the key elements of this legislature and one of the key stages in the opening up of the markets and the implementation of the internal market in Europe. We are approaching second reading after overcoming a number of difficulties encountered recently with translations and amendments - even now, this evening, the facility for tabling amendments is open until 7 p.m; in fact, it is about to close. In any case, this issue is of such significance as to require some in-depth comments.
We have conducted a lengthy debate, both direct and indirect, with the Commission. I would like to thank Commissioner Bolkestein and all the members of his staff for losing no time in addressing the issue. We have worked on it together on many occasions, outside the Chamber, outside Parliament but within the institutions, in an attempt to achieve the best possible outcome. I would like to thank all the Members who have made useful contributions through their interest, their input and the amendments they have deemed it necessary to table. It is a major, important reform which is coming to the end of the Parliamentary process after a period which has lasted for almost the whole of this legislature. Simplification, the alignment of technological and social development and the completion of the internal market were and are still the imperative goals driving Parliament. Debate, dialogue and the diversity of political positions and national interests have stimulated and shaped the conclusions.
Public works, public supply and public service contracts account for EUR 1400 billion each year in the Union, which means and shows that this legislation concerns the very powerhouse of the Community's economy. We are drawing up general, fundamental rules, on the basis of which specific national rules will be laid down. These general rules must contain principles which will be useful to all, not just to a few, which will be useful to the Community as a whole, not just to partisan lobbies; rules which will provide certainty, transparency, fair competition and an internal market which is open to all. Procurement rules cannot and must not differ according to the value: administrative procedures may differ above or below an appropriate threshold, but the principles cannot differ. At present, the thresholds mean that only about an eighth of the sum I quoted relates to European competitions. The rest is lost because of national or regional regulations. For this reason, I for my part acknowledge that the thresholds should be abolished. However, since that cannot happen, a requirement has been proposed which, moreover, already exists indirectly, according to which the basic principles of the legislation must, at any event, always be observed, including by independent territorial legislation. It is necessary for all possible procedures to be modernised and for the use of increasingly rapidly developing technologies to be permitted and codified. The awarding bodies will thus benefit from the proposals made, adopting electronic systems not just for the management of competitions and the receiving of bids but for the actual auctions too. Of course, auctions are required to be limited to the purchasing of codified, standardised materials. We want firms' freedom of organisation to be accorded due value and made use of, with every possibility of subcontracting left open for that share of the work which, once identified, can be entrusted to firms for whom the principal contractor is answerable. In order not to complicate participation in the competition, it is appropriate for partners to be identified after the work has been subcontracted.
The complex issue - and this has been a very controversial point - of awarding design and execution contracts jointly, appreciated and appreciable for some specific categories of contracts, cannot be a hard and fast rule. It is clearly appropriate and natural to separate services and works, just as it can be clearly appropriate and natural to treat them jointly, subject to prior justification. By respecting this principle we are consolidating qualitative competition too, which would otherwise be in danger of being squeezed out in a purely economic and technological context, being moreover the prerogative of the company alone and therefore not always beneficial to the contracting authority. This principle is the basis for the rapporteur's proposals. We must remember that we are dealing with a directive which is of high and singular economic importance and, as such, cannot and must not contain rules or principles which are governed by specific legislation such as specific social or environmental requirements. The environmental and social dimensions have processes which are defined and can be defined specifically and therefore made mandatory by means of other vehicles and in other contexts. However, some principles are laid down and proposed in the provision which refer particularly to respect for the needs of disadvantaged groups and the legislation on safety in the workplace.
The environment - the great victim of our time - is also dealt with exhaustively. Any further excesses in this area are to be avoided. With contracts being awarded on the basis of the most economically advantageous price, there has to be a weighting criterion properly defined in calls for tenders, in that, otherwise, there would be a discretionary power in the a posteriori application of parameters which has created many legal problems throughout Community territory in the past. The confidentiality of information which, according to the pre-established procedures, is provided to the contracting entity by the interested parties will be protected and safeguarded by specific rules. As regards 'in-house' contracts, there are conflicting points of view: the representatives of producers' associations are decidedly against reserving contracts for an enterprise of which the contracting entity is part, even if it has independent legal personality, without a competition, and your rapporteur agrees with them. It has been proposed to extend the causes of exclusion where there are sentences for subsequent offences relating to the tendering company on grounds of bankruptcy, unfair behaviour, failure to respect collective work contracts or drug dealing. Lastly, it has been proposed to set up an independent agency to provide control mechanisms for contracts in the Member States. Without prejudice to the possibility of instigating legal proceedings, we hope that this agency will be able to verify the procedures followed and also be able to cancel awards which do not comply with the legislation.
In conclusion, Mr President, the content of the rules under debate, because of their economic significance and because of their employment, social, environmental and economic implications, can be described without any shadow of doubt as essential to the organisation of modern-day society. Differing political positions and different political or bureaucratic points of view mean that a widely supported process is not possible. On the other hand, rejection and referral to committee or conciliation as the - not unproblematic - final stage in producing legislation is both possible and desirable. All this is in the interests of the Union and in the interests of an internal market which must become increasingly consolidated and transparent. The vote taken the day after tomorrow will confirm the democratic process, which there is no doubt that we must all follow.

Bolkestein
. Mr President, I am happy that these two issues have now entered their second reading, as a quick but thorough examination is necessary to avoid the dangers of the proposals not being adopted before the end of this legislature.
Our common task and aim is to modernise and simplify public procurement rules and in this respect I believe that the texts agreed upon in Council already strike a fair balance among the different interests at stake. Indeed, although there are a few issues that the Commission considers less than ideal, overall these common positions clearly represent an advance compared to the current legislation.
When I look at the substance of most of the amendments tabled to date by Parliament I feel even more convinced of what I said just now. I am therefore fairly optimistic that the vote due to take place later this week will preserve our chances of closing this file in a way that is satisfactory to all three institutions, indeed, in my view quite a number of amendments are already incorporated in one form or another in the common positions. I refer for example to the social aspects - other than social award criteria - where I understand that the main concern of this Parliament is to clarify that both contracting authorities and bidders respect the obligations laid down in social legislation. That concern was also explicitly debated with Council. It is therefore in my view appropriately reflected in the recitals of the current text.
I am ready to accept that it should be mandatory for contracting authorities and entities to indicate where information on the applicable social, fiscal and environmental obligations may be obtained. Equally, with some redrafting, the Commission could accept Amendment No 29 to the public sector - or classic - directive and Amendment No 26 to the utilities directive, which emphasise certain possibilities which already exist in the social field.
As for the environmental aspects and in general on the issue of award criteria, the amendments which Parliament has tabled clearly show some differing views. I am ready, as always, to debate further this interesting issue with Parliament through answers to questions, though in respect of the real aim of public procurement rules, as interpreted and confirmed by the European Court of Justice. Indeed, I have no doubt that we all agree that our priority is to make public procurement rules a simplified tool for public bodies to spend taxpayers' money as well as possible.
These differences of views have often meant that conflicting amendments have been adopted in the Committee on Legal Affairs and the Internal Market which, if accepted, would make legislation incoherent. We should perhaps all keep in mind our common stated goal of 'better regulation'.
This inconsistency is well illustrated by the amendments to the utilities directive concerning award criteria. Let us start by looking at how the common positions deal with this issue. In full accordance with the current state of jurisprudence, the common positions already clarify that environmental characteristics may be used as award criteria and that it is not necessary to show that each and every award criterion taking individually provides an economic benefit for the contracting authorities or entities.
It is sufficient that, taken as a whole, the award criteria meet their proper function: to allow an objective evaluation and comparison of the intrinsic qualities of the product or service and the award of the contract to the most economically advantageous tender.
It is, therefore, with some concern that I see amendments to the utilities directive that would go well beyond this. The effect of such amendments would be to allow vague, immeasurable elements, for the benefit of civil society in the broadest sense, to be used as award criteria. That would not only prevent award criteria from playing their proper role, but also introduce an unacceptable degree of arbitrary choice, or perhaps even discrimination to the detriment of potential contractors.
In respect of social award criteria, we should also keep in mind that the common positions already clarify that such criteria may be used where they meet the same conditions as environmental award criteria. However, these amendments to the utilities directive would permit social award criteria to be used to meet social policy objectives concerning the behaviour or the social responsibility of the tenderer, rather than the intrinsic qualities of the product or service in question. This could lead to the award of contracts on the basis of considerations which have nothing to do with the principal of better value for money.
On the amendments aimed at favouring small and medium enterprises, I should like to stress that information available to us does not show that SMEs currently encounter any major difficulty in gaining access to public tenders. Their European federation even told us that they would not support any positive discrimination in favour of SMEs vis-à-vis big enterprises.
In general, we should all be careful not to introduce changes which might de facto lead to national preferences which are incompatible with Community law and which might end up protecting economic interests.
Let me draw the attention of Parliament to the sensitive issue of thresholds, which may be the one where our divergence of views may be very hard to reconcile. My aim is to ensure effective competition at European level. If we increase the thresholds, not only would we breach our international obligations, but we would also reduce efficiencies. If we raise the thresholds we do not necessarily simplify life for local authorities, which are in any case subject to an obligation of adequate publicity under the current case-law of the European Court of Justice. That is why the Commission cannot accept those amendments.
In line with the interinstitutional agreement on better regulation we have recently reached, we all share the three objectives on modernising, simplifying and increasing the flexibility of the current rules. It is in this spirit that I have some reluctance in accepting some further amendments relating to different subjects such as e-auctions, framework agreements, dynamic purchasing systems, the competitive dialogue and the choice between separate or joint awarding of contracts for design and execution of works contracts. In fact, I fear that these amendments would multiply or complicate procedures unnecessarily or impose certain choices at Community level where the necessary flexibility could be better assured by making such choices possible at the national level.
I should now like to say something on some central issues specific to the utilities directive. Concerning the amendments to the mechanism for exempting contracting entities from the directive - Article 30 of the common position - let me stress that the common position is based on two principles, legal certainty and real, effective liberalisation. The Commission is therefore of the opinion that the presence of genuine competition should be established by a known procedure. Otherwise, neither contracting entities nor interested suppliers would be sure of their legal position.
The Commission is also opposed to other initiatives regarding specific sectors, which would permit exclusion on the basis of free access alone, irrespective of whether or not this results in effective and real competition. For essentially the same reasons, the Commission cannot accept the proposed changes concerning postal services.
Finally, concerning the 'intra-group' exception of Article 23, the Commission already made it clear that it has major difficulties in accepting the extension of this exclusion to works and supply contracts. It does not however, want to make the directive less flexible than it already is. For that reason, the Commission can accept the fact that the extension to works and supplies contracts should be eliminated, but not that contracting entities should be deprived of the existing flexibility for services.
In concluding I repeat that I am confident that by focusing on our main common goals to modernise, simplify and ensure an effective use of public money, we can provide a happy ending to the long saga of this reform to public procurement rules. This result is impatiently awaited by European enterprises, public authorities and contracting entities. It will be of great benefit to the European economy as a whole.
Finally, may I point out that the Commission's opinion on the individual amendments has been provided in writing

Lehne (PPE-DE).
Mr President, ladies and gentlemen, I will refer to Commissioner Bolkestein's article in last Saturday's 'Frankfurter Allgemeine Zeitung' - an article, Commissioner, that you published under your own name - and from which, with your permission, I will quote just one extract: 'It is important that authorities should get the highest possible return on taxpayers' money, and that this important economic sphere should be fully opened up to competition in the internal market, as open and competitive procurement guarantees an improvement in services of general interest, ensures that public goods are used effectively, prevents corruption and stimulates both economic growth and the creation of jobs'.
On that, Commissioner, I can back you 100%; the only problem I have is that I am one of those who believe that what we have received from the Council as a Common Position fails to comply with these very requirements and conditions. I am one of those who take the view that the existing laws on procurement in the European Union have worked so far; they are written down in four directives, to which one must add the settled case-law of the European Court of Justice, which was handed down over many years, and which has proved its value. We have doubts as to whether this Common Position, this Council document, is indeed suited to maintaining the quality we have hitherto enjoyed.
Many of us are concerned that the new elements in this directive have not reduced the danger of manipulation, but will end up increasing it. Many are worried that we will have, not more competition, but less. Referring back to this article, let me point out that the representatives of industry to whom I have spoken, were not concerned that this document might result in increased competition, but that there could end up being less of it. I believe that most of my group's amendments had the specific aim in mind of improving a whole array of crucial points in this directive.
Another aspect I would like to address is that of the environmental and social criteria, which, as I am well aware, are matters of great contention in this House. I do maintain, though, that European legislation should be right in terms of the legal system, and what that means is that I deal with environmental issues under the heading of environmental legislation and use legislation on social affairs to deal with social issues. The law on procurement is not part of environmental law, or of social security law; it has to do with business law, which means to say that the only issues to be considered in the field of procurement law are those of economic viability. It is for that reason that I have my own grave misgivings as to whether it is in any way right to deal here with issues relating to the environmental and social criteria. It is, though, evidently the majority view both in the Council and - to judge by the outcome of first reading - in this House, that if these matters are to be dealt with, we have to ensure that they are taken into account, not as part of the awarding of the contract, but in the criteria applying when the contract is put out to tender. I regard as unacceptable anything that, in relation to the award of the contract - independently, as it were, of what the various service providers knew when the contract was put out to tender - can end up resulting in further decision-making, or can make it possible for that to be manipulated.
I speak not only for myself but also for my group when I say that I regret the fact that it has not been possible to come to a compromise beforehand between the groups on the issues raised by this proposal. The end result of this will be a political showdown between the political groups in this House, while the Commission and the Council of Ministers get their directives through; what I fear, quite simply, is that there is little prospect for qualified majorities on the reciprocal amendments. I question whether that is a good thing for this House or for Europe. That concludes the comments that I wanted to make on this proposal on behalf of my group.

Koukiadis (PSE).
Mr President, during the first reading of the directives being put to the vote, the European Parliament fought vigorously for the incorporation of social and environmental criteria in the procedures for concluding public contracts, confirming its role as the champion of the European social model and sustainable development.
To our great sorrow, we find that the Council's common position has not accepted many of our amendments, which is why we need to continue our fight and stand firm by our initial positions. Respect for the acquis communautaire on employment and environmental issues cannot be ignored in the procedure for concluding public contracts. It is not possible for the European Union to be indifferent to such commitments by the Member States in public contracts, when the quality of employment relations and, more generally, the quality of life is now a generally recognised aim of all its policies.
In addition, just as we are willing to promote companies' social responsibilities in the private sector, it is inconsistent for Member States to be indifferent to issues that constitute companies' core social responsibilities when concluding public contracts. Thus, quality criteria can and must be taken into account by the contracting authorities as a matter of obligation. In the same spirit, infringement of the relevant obligations on the part of candidate companies must act as a reason to disqualify them from the procedure.
We would also stress that it is not enough to refer to social and environmental criteria in the preamble, they must also be included in the regulatory text of the directive. The area of public contracts is also an ideal area for taking account of people with disabilities. We therefore welcome the amendment introducing the obligation for contracting authorities to take account of accessibility criteria for people with disabilities.
To conclude, production agencies must understand that, by helping to implement European social policy, they do not incur an economic burden; on the contrary, they have economic benefits, such as subsidies when public contracts are awarded.

Thors (ELDR).
Mr President, Commissioner, it was said earlier this evening in this House that it is now a question of having to devise rules that remove the risks of corruption, nepotism and the abuse of power. It is therefore important that we bring about the simplification intended in the Commission's proposal. I am afraid, however, that we may be in danger of failing in our task of ensuring that this is what happens, because the majority of the committee have voted in favour of a lot of restrictions that may cost European taxpayers dearly.
The Group of the European Liberal, Democrat and Reform Party believes that there are no reasons for raising the threshold values. As has been said on a number of occasions, it would contravene our international obligations. Nor are we convinced by the argument for raising the threshold values on the grounds that there are now so few cross-border tenders. On the contrary, we may find ourselves with more cross-border procurement as a result of simplifying the directive, applying the simplified procedure and having a larger number of electronic tenders.
The ELDR Group is concerned that Parliament's amendments, for example Amendment No 20, might reduce transparency on the subject of procurement in most Member States. It is important, once a contract has been concluded, for competitors to be able to check that the procedure is being carried out correctly. Amendment No 24 must therefore be rejected. The eagerness with which the other political groups have endorsed Amendment No 20, aimed at increasing secrecy, sometimes leads me to wonder whether we are all aware of what we have decided when it comes to access to EU documents.
The ELDR Group, which is otherwise fairly satisfied with the common position, is, however, anxious that the Council's position would be less effective than current legal practice in providing opportunities for taking account of environmental aspects. In our view, a procuring authority should be able to go beyond its brief, as narrowly conceived, and take account both of the value to the environment of what is being purchased and of the method by which it is produced. We have therefore again tabled an amendment to Article 53 that, at first reading, was supported by almost the whole of the Chamber. We also wish to reject those amendments by the committee that would shape the directive in such a way as to impede the reorganisation and modernisation of public administration.
We are also unhappy about the restrictions that the majority of Parliament have wanted to see imposed upon electronic tenders, involving even stricter regulations than those laid down in the electronic signatures directive. I am amazed at my fellow MEPs' distrust of electronic signatures, but confidence in fax messages, which often lead to information leaking out.
The ELDR Group wants us, then, to make efforts in the direction of simplification and modernisation. We therefore hope that we shall vote wisely on these matters.

MacCormick (Verts/ALE).
Mr President, it is a very important matter that we discuss tonight, as Mr Bolkestein said. He urged us, in his closing words, to make sure that we modernise and simplify European Community law and endow it with appropriate flexibility. With this I believe we can all agree. The issue is: which exact text will best achieve that?
To establish the general orientation of the Group of the Greens/European Free Alliance, we thought that the Commission's original proposal was unduly timid and grudging on points such as the environmental and social points. We, and others in Parliament, urged a broader and more generous view - the one that was in due course confirmed by the Court of Justice in the Helsinki tramways case. That was a real advance. It was not just our view, but Parliament's view at first reading.
Then we have the common position. To us, the common position seems to be in some measure a retreat from the high-water mark represented by Parliament's first reading position. We would like to see some aspects of that retreat again reversed. I accept Mr Bolkestein's point that the text, as it came to us from the Committee on Legal Affairs and the Internal Market, is internally inconsistent. I would put that down to the fact that in committee we had an unstable and varying majority, which meant that there was no clear golden thread running through the text that came from the committee. But there is a way of restoring it to consistency, coherence and environmental and social sensibility, which is to adopt the string of amendments, which will pull it back towards Parliament's first reading position and again exhort the Council and the Commission to take a bold step that will continue to serve these valuable goals of modernisation, simplification and flexibility.
My own group will put forward two amendments in particular relating to Article 53 where, for example, we will object to the idea that it must be a tender most economically advantageous for the contracting authorities. We are told that sometimes social or environmental criteria are vague. That seems to be fraught with vagueness - the insistence that it be, as it were, self-referentially back to the authority which is contracting. That would give rise to all manner of disputes. Leave it as we suggest: various criteria linked to the subject of the public contract in question. Do not leave out characteristics, including those relating to production methods or the tender as equal-treatment policy. If these are unacceptably vague then the whole of Community law is unacceptably vague because we are exhorted in the horizontal clauses of the Treaties to attend to these very values!
Let us be brave! Let us go forward, colleagues! Let us restore the kinds of values that we asserted in the first reading position. Let us get rid of the inconsistencies, but let us get rid of them in the right direction.

Blokland (EDD).
What can this Parliament expect from a rapporteur at second reading? What line is a parliamentary committee to take if the Council's Common Position differs from Parliament's position at first reading?
It is obvious that the key amendments, given this Parliament's political vision, should be re-tabled. At present, the promotion of sustainable economic development is high on our list of priorities. We must also take subsidiarity into account, which means that we must not hinder municipalities and regions unnecessarily.
Studying the proposals of the Committee on Legal Affairs and the Internal Market, I rubbed my eyes in disbelief. I had been used to a great deal, but the current product deserves to be marked down emphatically as a flop. Some arguments would be enough to make you laugh if they did not concern serious matters.
What should we make, for example, of the justification to Amendment No 63: I quote: 'Giving a weighting to each criterion is unrealistic and too mathematical an approach'. It appears that multiplying and adding up are already higher maths for the Committee on Legal Affairs and the Internal Market.
In summary, the Committee on Legal Affairs and the Internal Market has not acquitted itself of its task effectively, and it is up to plenary to undo the damage with regard to how this Parliament is represented.
A municipality should be entitled to take environmental criteria into consideration in the award of a public contract. It is with good reason that Helsinki won its case when it procured clean buses. It would surely be too crazy for words if it were not possible to draw a distinction between electricity generated in an environmentally-friendly way and other electricity.
Lower authorities should be able to acquire sustainable products and services. This obviously also applies to the governments of the Member States. With a market share of 16% of the GDP, it is precisely the government that should advocate a policy that promotes sustainable products and services. If we were to overlook this, that would give a totally wrong signal to private industry, especially at a time when the latter is starting to gain an understanding of the need for sustainable products and services.
The package of amendments, which I also signed on behalf of the Group for a Europe of Democracies and Diversities, makes the directive acceptable from an environmental perspective, and the subsidiarity principle is respected. With this, we place the responsibility for a policy of sustainability firmly with governments that take concrete decisions as closely to the citizen as possible.
As an MEP, I would not like to come face to face with a citizen who learns from his local councillor that 'Europe' does not allow him to secure environmentally responsible public contracts.

Markov (GUE/NGL).
Mr President, ladies and gentlemen, I endorse the approach taken by the Committee on Legal Affairs and the Internal Market, which has tabled a large number of amendments to the Council's Common Position on the new rules for public contracts. We have already had many discussions in this House which have highlighted the need to support small businesses and the self-employed, along with the need for bureaucracy in tendering procedures to be reduced at the same time as transparency and comprehensibility are increased. Further economic and social progress in the Member States will depend on the fulfilment of both these important demands. Parliament's demand for threshold values for public contracts - depending of course on the utility involved - to be increased is absolutely justified if we want (a) to reduce the very high costs involved in tendering on a Europe-wide basis, and (b) to give small and medium-sized businesses better opportunities in the European Union. It goes without saying that this heading includes the amendments aimed at reserving 10% of the expenditure on public contracts for small and medium-sized enterprises and at increasing the threshold values in the event of authorities being parties to contracts for the work to be carried out.
Commissioner Bolkestein, I really cannot see what you are getting at! I think my group, along with the others, did the right thing in emphasising the importance of invitations to tender containing conditions relating to the management of the environment and guarantees of workers' health and safety. In principle, this is in line with the sustainability for which the Council opted in Göteborg in 2001, with the economy, ecology, and the social dimension being given equal priority. That someone should argue against that is something that I find utterly baffling. This must apply not only to the way in which the main contractors meet the specified criteria; it goes without saying that it must be binding on the sub-contractors as well. If firms do not produce evidence of how they deal with finances and with their staff, their tenders should be rejected.
I do, though, have doubts about compliance with data protection provisions when contracts are put out to tender electronically. We also support the demand that enterprises or persons who have been declared bankrupt or against whom court cases are pending should be excluded from tendering for public contracts. Rather than this being merely a permitted option, there should be binding rules on this. It stands to reason that exclusion from tendering for public contracts should also be extended to enterprises that had breached the conditions of tender on previous contracts.
I also ask my fellow Members of this House, when plenary votes on Article 27, to adopt the version of the text included in the Council's Common Position, for if we do not, then 98.5 % of German collective wage agreements would be excluded as a criterion in invitations to tender, which would put German workers at a disadvantage when competing for the award of contracts.

Harbour (PPE-DE).
Mr President, as Parliament's rapporteur for a single market strategy, it is important to emphasise that the operation of an effective, open and competitive public procurement process is an absolutely indispensable foundation of a working internal market.
I am very grateful to the many colleagues who supported my report. We in this Parliament called for the speedy completion of the internal market and particularly recalled that an effective internal market is a major weapon in the European Union's competitiveness. I want us to return to that in looking at the context of what we are examining here. We want this new proposal - if it goes through in a final form as agreed by ourselves and the Commission - to be the most effective instrument we can devise to, firstly, encourage public authorities to obey and use it.
Nobody here has pointed out that the problem with the regime at the moment is that a significant number of contracts that ought to be included in this public procurement regime are not. Why are they not included? It is because the procedures are complicated, because they are being evaded. Also. the counterpart to that is that we want the maximum number of small and large firms to participate in the process. That is what an open and competitive market has to be all about. Therefore, the aims included in the revision of these directives - to make the rules clearer, simpler to operate and unambiguous, and to allow the incorporation of new technologies such as electronic auctions - have to be commended. We are basically satisfied with the direction that those proposals go in because they seem to me to be crucially important.
We must move forward in other areas as well. There has been a lot of discussion tonight about issues, particularly involving sustainability and ecological procurement. However, there is nothing whatsoever in these proposals that in any way outlaws sustainable or environmentally friendly procurement. Provided that public authorities clearly specify the environmental criteria that the product or service must meet in an unambiguous and non-discriminatory way, then there is nothing to stop them from doing that.
This is an instrument of internal market and competitiveness policy. It is not a fresh instrument of social or employment policy, nor is it a fresh instrument of environmental policy. We may want to ensure that those criteria are applied in a non-discriminatory way, but companies that comply with all the European rules on environment and on employment criteria must be able to tender in a non-discriminatory way. This is not an instrument for adding new provisions. Therefore, we must be very clear in rejecting any amendments that try to do that.
I understand that colleagues on this side of the House are about to subject us to a whole raft of fresh amendments tonight, so we shall probably have and look forward to looking at a hundred amendments tomorrow for a vote on Wednesday. That seems to me to be an entirely unrealistic thing to do. However, unfortunately, we are forced to do that by the constraints of the timetable.
Finally, I just wish to draw the House's attention to the merit of Amendment No 68 concerning monitoring. We want the member governments to monitor the application of public procurement rules better and to encourage local authorities to comply with them, because compliance with these new rules will be the test by which this proposal is finally judged.

Gebhardt (PSE).
Mr President, Commissioner, what we are dealing with here in these procurement directives is very definitely a multi-faceted problem. In the brief time available to me, I would like to consider two aspects of it.
My first point is that we must fix the threshold values at the level that Parliament wanted at first reading stage. Having them even higher would have been desirable, as experience shows that Europe-wide tendering brings with it a lot of bureaucracy and higher costs that bear no relation to the relatively few offers that are put in. What I particularly want is for the costs and administrative burdens that international tendering entails to be kept down for public contracting authorities, primarily in local government. It was regrettable that, at first reading, we managed an increase only from EUR 5 million to EUR 7 million, for example in building contracts, and the governments in the Council now want to reduce this at second reading. Our second reading amendments in the Committee on Legal Affairs and the Internal Market held out for at least these EUR 7 million. I very much regret the fact that the demand for a higher - and actually reasonable - threshold value than EUR 7 million is unlikely to be possible in the final reading of the Procurement Directive.
What is every bit as important to me as playing for millions with the threshold value in the directive on European procurement is the protection of small and medium-sized enterprises from unfair competition. Our self-employed, who abide by the law, must not have life made difficult for them by competitors who keep neither to collective wage agreements nor within the current labour law or health and safety provisions, and who do not give a fig for protecting the environment.
In so doing, we would be attaching a high value to local self-government, and rightly so, for it is clear that local authorities are the political level closest to the public.
Mr Bolkestein, you were right to say that taxpayers' money must be spent in the best way possible. I agree with you on that. However, that does not necessarily mean the cheapest on offer. 'Best possible' carries connotations of quality and sustainability, in other words, due regard for social, environmental and other issues.
Schörling (Verts/ALE).
Mr President, Commissioner, as draftsman, at first reading, of the opinion of the Committee on Legal Affairs and the Internal Market on this report, I intend to concentrate on the environmental issues and the issue of sustainable development.
Commissioner Bolkenstein thought we could look forward to a happy ending to the long journey towards sound legislation when it came to public procurement. Yes, we can agree upon the fact that the process is coming to an end, but how happy it will be is, I think, something that will be decided in the vote. The Council too has a big influence in this area, of course.
I am concerned about the amendments tabled by the Committee on Legal Affairs and the Internal Market, because they run directly counter to what we said at first reading. We are all agreed that public procurement is a major economic factor in the EU, accounting for 14-16% of gross national income. When account is taken of the economy, account should not, however, only be taken of the financially most advantageous tender. What is needed is a broader economic definition, also embracing the conservation of natural resources, clean water, clean air and biodiversity. That is precisely what the Commission and the EU in general have said, for example in Johannesburg, namely that public procurement must contribute to sustainable development. It is odd that this has passed certain people in this Chamber by. I heard Mr Lehne say that environment issues must be handled in their own terms and economic issues likewise, but that is to miss the whole point. Public procurement, in which our common resources and common tax money are used, must contribute to sustainable development.
It is therefore of the very greatest importance that we amend the proposal before us from the Committee on Legal Affairs and the Internal Market and remedy the ways in which it has deteriorated since the first reading. The Council's common position contained incompatible elements and was unacceptable at least where Articles 53 and 55 were concerned. Together with MEPs from other groups, we have tabled amendments concerning the environmental criteria, production methods and the whole life-cycle perspective upon products, environmental labelling and certification. I think that the European Parliament should be ashamed if we did not adapt our view of public procurement to the prevailing view of sustainable development in the EU as a whole. This must become a natural part of public procurement.

Schmid, Herman (GUE/NGL).
Mr President, I, and presumably also my fellow Swedish MEPs, have been presented with a number of comments on this report from concerned Swedish authorities. In Sweden, these authorities are used to being regarded as competent economic actors with quite extensive freedom of action. They believe that the Commission's proposal would, in a number of respects, reduce their efficiency without increasing either competition or legal certainty. They refer to matters such as the right to enter into framework agreements, of which they often make use, concerning intellectual services and building contracts. They mention the new Article 41a, to the effect that award procedures can only be cancelled under very special circumstances. They wonder what would happen, for example, when there was a change in the political majority and wonder if it might not in those circumstances be possible to cancel an agreement entered into. They also refer to a number of other points on which Swedish practice is much more efficient than what is proposed in these directives.
It is said that public authorities are bureaucratic and inefficient. If that is the case, then it is, in general, due to the fact that we politicians devise exaggeratedly detailed legislation. I think that the Commission's proposal for a directive on the award of contracts is one such example - I am tempted to say nightmare example - of legislation that creates public sector inefficiency and that gives rise to more problems than it solves. I really do think that the whole proposal for a directive should be withdrawn. The closest I can get to bringing about such an outcome is probably to support an amendment by Mr Manders of the Group of the European Liberal, Democrat and Reform Party, in which the Commission is called upon to reflect on the situation and reconsider whether the proposal does not create more problems than it solves.
I know that the situation is different in different countries, but I find it strange that the lowest possible price is a consideration with such a dominant role to play in the Commission's proposal. When private businesses award contracts, they make an overall assessment of a number of factors, of which price is just one. Why cannot public bodies be viewed in the same way and be given the same freedom to make a complex assessment of tenders submitted? Why, in a legal text, should a list be drawn up of which capricious considerations should, or should not, be taken into account? These lists are arbitrary. Why is the Commission so restrictive when it comes to certain factors such as, for example, social needs and environmental and employment considerations, which have more to do with the quality of the products than with purely quantitative relations?
I think that the Commission should consider tabling instead a directive laying down general principles and guidelines, that is to say one that does not go into details in this way but is instead more interested in how the public administrations are to be made more efficient and democratic in the Member States. It would then be possible to find significantly more flexible solutions to these problems.

Andersen (EDD).
Mr President, I shall concentrate on the proposal to award contracts for the supply of water. In Denmark, the supply of water is decentralised and based on a principle of solidarity where accessibility and prices are concerned. In Denmark, the water supply is owned by the consumer and managed locally, and those are very important prerequisites for being able to guarantee that water sources and the environment continue to be protected. Water is a public good. It must not be part of a strategy for the internal market or a means of promoting European industry. In the future, those who control the water supply will be those who wield power over people and money. The multinational companies are exceptionally aware of this, and there is money to be made in this area. It is estimated that, in the EU alone, the market is worth EUR 80 billion per year and that, in 15 years' time, large monopolies will control 65-75% of what are now public water supplies.
A number of directives, including the two we are debating today, have now incorporated water as a commodity and are in the process of standardising countries' water supplies with the purpose of liberalising them and guaranteeing that drinking water is subject to free competition throughout the internal market.
Experience in the UK and elsewhere is frightening. It demonstrates that, when the water supply is turned into a commodity and privatised, interest in the protection of resources also disappears. In fact, London's private water suppliers lobbied enthusiastically, and on equal terms with the European chemical industry, for our simply allowing larger quantities of crop sprays in drinking water when the EU negotiated limit values.
The world's total accessible fresh water resources are scarce. There are now already countries in which it is drinking water, rather than food, that is in short supply. Liberalising the water supply would mean that the fight for water would overtake that for oil. That is a frightening prospect.
At the moment, the EU is impeding Denmark's efforts to safeguard our groundwater against pollution, while the EU is in the process of lifting a number of the bans on pesticides imposed in Denmark. The EU must not also destroy the Danish principle according to which the water supply must be public and always owned by the consumer and managed by the owner - an important and crucial prerequisite for security of supply and the protection of water sources. It must be up to the individual country democratically to decide which model they wish to adopt for the supply of their water.
Another little thing that naturally pleases me, since I live on one of Denmark's many small islands, is that it has now been realised how completely useless it is to invite tenders for the running of our little ferries and that the process has now begun of drawing up a specific directive exempting these small ferries from the awarding of contracts. This is something I of course very much welcome, but it illustrates the fact that there is something fundamentally wrong with the EU's demand for tenders to be invited in connection with every task.

Karas (PPE-DE).
Mr President, Commissioner, ladies and gentlemen, the directive on public procurement now before us is supposed to reflect the outcome of intensive negotiations extending over a period of years. It appears from this debate that the opinion-forming process is not yet complete. In committee, too, we were constantly arguing whether it is possible to modify the Council's Common Position, or whether, in order to improve it, we first have to reject it.
This is a case in which I have to say that, for my own country, Austria, the advantages of this directive outweigh its disadvantages, not least because, on 1 September 2002, we implemented a new procurement law which owes much to the directive and to the draft directive. Whilst, on the one hand, the new rules modernise procurement legislation, the directives also incorporate important clarifications for their practical implementation, and the result is meant to be more transparent and fairer invitations to tender.
I want, briefly, to consider four points. Firstly, the provision for the possible use of electronic media strikes me as being particularly important. The introduction of e-procurement is one of the new directive's key elements, and from the new electronic procurement instruments we can expect sustained good progress. These instruments should, however, apply solely to standardised goods and services.
My second point is that, in Austria, there is in fact opposition to the increase in threshold values, as this would go against the opening-up of central, regional and local markets for procurement and, even today, covers only a small percentage of the contracts awarded under the EU's procurement system. We take the view that any further increase over and above what was proposed in the Common Position would restrict the scope of the directive, which is, after all, aimed at producing greater transparency and more fairness in invitations to tender.
I would like to mention, thirdly, the newly introduced procurement procedures and rules for central procurement offices, which make it possible to have a system of procurement organised on modern lines.
Fourthly, let me say something about the disagreement on secondary purposes. One reason why I have no problem with these is that Austrian procurement law takes secondary purposes into account, although there is no target set by law. I see it, however, as a requirement that all secondary purposes should be relevant to the contract, which means that they have a direct connection with it; any alternative is a recipe for arbitrariness on the part of the body awarding the contract and for the foreclosure of the market. If there are to be secondary purposes, they must be clearly defined, and that cannot be done anonymously.
Although I do not know what the outcome of tomorrow's vote will be, I do believe it to be important that we should get this procurement law, and as quickly as possible, as it will benefit the internal market, bring about greater transparency, and make for more fairness.

Karlsson (PSE).
Mr President, it is important for there to be good, clear rules when it comes to public procurement. It is public funds - taxpayers' money - that is being used, and procurement must therefore, of course, be carried out in such a way that taxpayers get the best possible value for their money. It is also important that the quality should be good. All this could be summarised in the words 'high-quality goods and services at the right prices'.
Now, this is not all that simple because it is not only the price that is decisive. It is important that whoever produces the goods or services should do so under fair conditions. It is also important that they should do so in a way that is environmentally correct. Current laws, regulations and collective agreements concerning social protection and health, both at national and Community levels, must be applied when goods and services are purchased. The working environment must be good and the salary conditions fair but, at the same time, this decision must not create rules that interfere with labour law as applied in the Member State concerned.
I have tabled amendments on the same lines as those tabled by, for example, Bill Miller, who addresses this issue. It is also important for the procuring authority or administration to be able to cancel a contract if it no longer needs the goods or services in question. A new municipal or national government may want to conduct a policy that does not require as much in terms of purchases as that of the previous political leadership.
The decision we are now to take must not restrict democracy or people's ability to change direction following general elections. Public procurement is about making provision for the needs people want to see fulfilled by the society about which they have made decisions in political elections. An exaggerated ambition to look after the interests of the market must not take precedence over the needs of people.

Laguiller (GUE/NGL).
In the debate between Council and Parliament on the award of public markets in the European Union, the eye is instantly caught by the extent to which the bitterest enemies of state control forget their reservations as soon as the contest for state contracts begins. State money attracts them. How could the great construction and public works consortiums have built their financial empires, indeed, without state contracts? How would armaments consortiums survive if there were no public money?
The so-called market economy is on a life-support machine, kept alive by the state on a saline drip. It is no coincidence that public market harmonisation is progressing so slowly. The big industrial cartels would like to keep access to their own state's money hostage even as they lay their hands on the public money of the country next door. As to the conditions for award of markets, the rules which are beginning to emerge reflect, in their desiccated bureaucratism, a cynicism bordering on sincerity. Under these conditions for the award procedure, the monetary value of the offer is the only thing that matters. Environmental and health requirements have been forgotten, to the justifiable indignation of Greenpeace and Friends of the Earth. The same fate has befallen working conditions and workers' remuneration in the companies which are pocketing public money. Also forgotten are so many other aspects, such as archaeological research. Forgotten, last of all, are the interests of society in general. Returns are all that counts. Social organisation has been reduced to a balance sheet.
Furthermore, under the pretext of coordinating procedures in the water, energy, transport and postal service markets, the Council is trying to enshrine these as intrinsically no more than that: markets, rather than vital services for the whole of society. No! Those water, energy and transport services, those postal services, must be and remain public services. They cannot be surrendered to these private groups, who are concerned with their own profits and not with the interests of users.
Jonckheer (Verts/ALE).
Commissioner, I listened to your introductory speech carefully and have tried to understand what lies at the heart of our differences.
We are of course in agreement with you on the aims of simplification, modernisation and proper use of public finances. Who would not be? You forget other aims, however. My fellow ecologists and I have reminded you what they are: the aims of sustainable development. We feel that public markets and the means by which they are awarded are extremely important levers for realising those aims.
Why do you reject, as you have pointed out, the amendment introduced by us to Article 53(1) of the classic directive, in which we allude to environmental characteristics, but also to modes of production? Why refuse to allow the contracting authorities to give preference to modes of production based on rational use of energy, for example? That seems incredible to me.
Furthermore, in Article 23 of the directive, why refuse to refer to another aspect of Community legislation, European eco-labels, justifying yourself by arguing that these are a non-mandatory set of guidelines? Very well, then. Make the aforesaid guidelines into one of the criteria for awarding public markets and encourage businesses to respect this type of eco-label. That would fit in perfectly with the aim of introducing an integrated sustainable development programme, an aim promoted by the European Parliament and the European Council. The tool of public markets could help us towards that aim. I deplore the extremely conservative and classical vision of commercial law revealed by you once again in your speech.

Hughes (PSE).
Mr President, I produced the opinion for the Committee on Employment and Social Affairs at first reading and I would like to raise two specific points that still arise from that opinion.
The first concerns paragraph 2 of Article 27 in the classical directive and the equivalent text in the utilities directive. It is important that we leave out the phrase 'collective agreements declared or deemed to be generally binding'. That phrase would create difficulties and legal uncertainty, most particularly in Germany and the Scandinavian Member States. I have worked very closely with the European Trade Union Confederation and with the public service unions both at first reading and second reading and I have received - and a number of Members here will have received - a large number of representations from concerned individuals in those countries. I hope, via split votes, that we can leave that text out of the finished text at second reading.
My second concern applies to Article 53 in the classical directive. Several amendments will probably be on offer to align this text with that of Article 55(1), in the utilities directive, as it now stands following the adoption of an amendment by Mr Karlsson in the Committee on Legal Affairs and the Internal Market.
I disagree with what Commissioner Bolkestein said earlier on this point. If we align the classical directive with the text of Article 55(1) of the utilities directive, we would be bringing them into line with the emerging jurisprudence of the European Court of Justice. Not to do so would be a retrograde step. The Commissioner and his services have consistently given far too negative an interpretation of ECJ jurisprudence on this point and that is why we have such clear difficulties emerging in our debate here over applying environmental and social considerations. I hope that these considerations can be taken into account tomorrow.
Turmes (Verts/ALE).
Mr President, I want to come back to the remarks made by Mr Harbour. We want to create innovation. Would you agree with me that we will not create innovation by imposing standards on ecological or social issues? This is only the lower level. In a market economy there are factors wish push the market and factors which pull the market: the stick and the carrot.
What we want, when we speak about introducing ecological criteria or fair-trade criteria, is to create a market for innovation in ecology, fair trade and social issues. Therefore we need clear criteria on this in the directive. That is the only thing we need. That is why we are pushing this so much. It has enormous leverage - 15% of the European internal product. If we are serious about sustainability we have to use this. It is not via fierce competition in the private sector that this innovation will come. It will be because the public sector takes more responsibility.
Commissioner Bolkestein, why do we disagree on this point? Because your Europe is a Europe of big multinational companies where there is no ecology, no social rights and where the poor people live in their poor working conditions. My Europe is a Europe of citizens. I am proud of this. If we have to fight over this issue it is because you have a very new, liberal approach to Europe and we do not want that.
Thorning-Schmidt (PSE).
Mr President, I wish to concentrate on that part of the report concerning public procurement where, unfortunately, the untoward situation has arisen in which, even though we issued a sound report at first reading, the quality has, since then, gone seriously downhill, with regard too to the common position we have obtained from the Council.
I think it is a huge problem when the Council adopts a common position that is not in accordance with current law as laid down by the Court of Justice. The fact that the Court lays down something of which the Council takes no account is a major problem, and matters are not made any better by our also having a committee that chooses not to take account of the Court pronouncements we have. I believe that we in the EU have a clear obligation to promote our own objectives concerning sustainable development and to comply with our social responsibility. That means that we must also be able to incorporate social and environmental considerations into public procurement.
I should like to say to some of those on the right wing who, in Parliament today, have accused us of being rabid environmental campaigners, that what is important in this case is that we in actual fact want to make public procurement transparent and to make it possible for social and environmental provisions to be incorporated into such procurement without, of course, disturbing the internal market. No one is talking about disturbing the internal market. We are all of us concerned that the internal market should operate properly, but we just want to make it possible for those who invite tenders to attach importance to things other than just price, that is to say to a broadly-based labour market, social conditions and the environment. It is in actual fact very simple, and fortunately we have a decision on this matter.
The second thing I have to mention is that, during the first reading, we tabled a number of amendments to Article 27, in actual fact emphasising the aspect of labour market conditions. As Mr Hughes said, a curious change has, however, again crept into the amendment whereby it has been made conditional upon the aforementioned agreements being made law in the Member States. It is therefore essential to have that clause removed before we vote on the recommendation for second reading on Wednesday. There is no reason for interfering with the collective agreements we have in certain countries, and that is what in actual fact would be happening if the small clause in question were not removed. I recommend to the House here today that it consider adopting Amendment No 40 but that it avoid also accepting this clause. I hope we can in that way support the split vote proposed by Mr Hughes.

Bouwman (Verts/ALE).
Mr President, Commissioner, Mr Zappalà, some 10 years ago, I sat on the municipal council in Eindhoven, in the southeast of Brabant, which is a technology region. Philips and Daf were in dire straits. It was a time of high unemployment as a result of all kinds of developments in international industry. In those days, there was a covenant involving industry and the municipality on building in a sustainable manner. There was little employment in the building industry. Then, we discovered that in Groningen, there was a model for European contracts which was able to meet a number of criteria, for example with regard to equal working conditions and social legislation, but also to the regional labour market's employment criteria and to environmental criteria. We found this valuable and subsequently applied it.
This would, to a large extent, be allowed on the basis of the current proposals. However, the problem that is causing anxiety for many is that the Christian Democrats, and particularly the Committee on Legal Affairs and the Internal Market, have accepted a number of amendments on the basis of which it would no longer be possible to spend public funds in this transparent, non-discriminatory way that serves regional causes.
We are talking about socially responsible entrepreneurship to ensure that financial, social and environmental objectives are integrated into a strategic policy. We should, however, be fighting for socially responsible government even more than for socially responsible entrepreneurship. We could then, if we take transparency into account, also avoid the likelihood of fraud.
In other words, we agree to a number of the objectives that Mr Bolkestein mentioned, such as legal certainty and effective spending, but integral policy means that we should also include a number of other criteria, and that is what, in my view, we should vote for tomorrow.

Berger (PSE).
Mr President, let me, in my capacity as my group's shadow rapporteur, apologise to you, to the Commissioner, and to all my fellow Members for not having been present at the beginning of the debate. Together with Mr Bill Miller, I was trapped on a Strasbourg city bus, the driver of which could not find the way, initially to Frankfurt and then back to Strasbourg, and got us to Strasbourg via many German autobahns and with something of a delay.
Belatedly, but not too late, I would like to thank the rapporteur for the great deal of work he has done and, in particular, for resisting his first temptation, that of giving in to quite understandable disappointment that the Council has taken up so little of what Parliament has proposed and therefore going all out for a rejection of the Common Position. This was something we discussed in the committee, where a majority of us took the view that - even if it proved a wearisome exercise - we should attempt to make improvements to the Common Position.
The fact is, of course, that the debate about rejection of this Common Position is far from over. I do not know if, perhaps, another amendment has been tabled this evening with this in mind; that there is a great temptation to do so has to do with the fact that, whilst the Council took on board quite a bit of what Parliament had proposed, this tended to be harmless technical points, whilst the major issues of substance were utterly ignored.
What still counts from my point of view is that, in both draft directives, I can see substantial improvements over against the current legal position, and certainly as regards modernisation, simplification, the introduction of electronic tendering procedures or the use of electronic media in the tendering process, and the ways in which things are made easier for specific sectors. For example, I am very glad that this Parliament's initiative has succeeded in getting postal services included in the utilities directive.
If though, on the one hand, we can speak in terms of progress, we should beware, at the same time, of ending up going backwards. There has already been much debate about the award criteria, and I would like to again shed light on something that is obviously not yet clear, namely that the text now provided in the Common Position represents a retrograde step vis-à-vis the current legal position and removes the legal basis on which the Court of Auditors could make very favourable judgments. The result is that these award criteria will be more restrictive in future. Being more restrictive in this area does not mean merely that I do not want options - of an ecological nature, for example - that are currently available to me; my concern is, rather, with the issue of democracy. Local authorities are among the most important bodies in Europe as a whole when it comes to awarding contracts. Mr Bouwman mentioned an example from the one where he lives. As institutions, local authorities enjoy direct democratic legitimacy, and if, for example, they come to realise that - even if it comes rather more expensive - they want wooden window frames produced by sustainable forestry, then let them in future be able to have them. They are responsible to their own citizens and to their auditors, and nowadays they do not exactly have much money sloshing around.
That is also my objection to what Mr Karas said. If we are struggling to make improvements, our primary concern here is with restoring the current legal position rather than with going back to what preceded it; secondly, this is not about mandatory criteria along the lines of every contract-awarding body having to apply every conceivable criterion; rather, it is about them being able to do so if that is what they would like to do and if they are transparent in the way they do it. As it is at present framed, the obligatory part can have only one meaning, that these options are restricted. Although the recitals reintroduce the possibility of a number of things, I find that rather unpleasing from the point of view of legal policy, and I do not think it does much for legal certainty either.
As reference has been made in this debate to the inconsistencies that remain, there is an offer I would like to renew. Perhaps we could, by aligning our voting lists tomorrow, recover something of what the Committee on Legal Affairs and the Internal Market produced? I can also announce that we will no longer be supporting all the amendments that we supported in the Committee on Legal Affairs; this will enable us to take with us rather fewer amendments into the conciliation procedure that now appears, unfortunately, to be unavoidable.

Miller (PSE).
Mr President, it is important that we have transparent, workable directives. It is important to give a clear lead to our local authorities or to our public - in some cases private - utilities. Above all, it is important that we give a clear lead to the workforces operating within those contracting authorities.
The Committee on Legal Affairs and the Internal Market unfortunately did not provide that transparent, workable directive. What we have is two directives, which are not in line with each other. In fact, in certain areas, they are actually contradictory. The Legal Affairs Committee missed an opportunity to advance the social provisions to workers. It has advanced - to give it credit - the case of workers with disabilities. But we could have gone further.
That is why I am reintroducing my Amendment No 166, which was adopted at first reading by a large majority. Now certain groups seem to have gone cold on it. Amendment No 166 to Article 53(1) and (2) reintroduces the flexibility contracting authorities require when deciding on awarding contracts, not just being bound by the lowest price.
It should be made clear to all those companies that intend to tender for these contracts that they have to introduce social and environmental conditions for their own workforces or they will not get the contracts.

Bolkestein
. Mr President, thank you for giving me the floor a second time on this important matter. I would like to reply to some of the points raised. I would like to elucidate what I said earlier so that no misunderstandings remain between what this Parliament would like to see the Commission do, and what the Commission itself intends to do.
Firstly I refer to what Mr MacCormick said right at the beginning of this debate, which was also repeated by other speakers. Mr MacCormick referred to the current state of jurisprudence. In accordance with that jurisprudence, the common position already clarifies that environmental characteristics and social clauses may be used as award criteria and that it is not necessary that each and every award criterion taken individually can be shown to provide an economic benefit for the contracting authorities or entities. It is sufficient that taken as a whole the award criteria can carry out their proper function, which is to allow an objective evaluation and comparison of the intrinsic qualities of the products or services offered and by the award of the contract to the most economically advantageous tender. Here I would also refer to Mr Harbour's remarks, with which the Commission agrees.
Secondly, Mrs Thors and Mr Junker referred to production methods. I should like to reply that regarding the amendments which aimed to insert explicit references to production methods, the Commission is of the opinion that it is superfluous to do so since production methods are a part of the environmental characteristics which, as I have just said, are already allowed for. Furthermore, they are explicitly referred to as examples of legitimate technical specifications.
I then come to my third point, which was also raised by Mr MacCormick. In Article 53 the words 'for the contracting authority' are explained by recital 44 as meaning that the best tender will be assessed according to what the contracting authority will have defined as its requirements. Recital 44 further clarifies that this encompasses requirements addressed to satisfy the needs of the public concern in the case of the ruling about the need to limit air pollution for the population of the City of Helsinki.
Mr Koukiadis gave us a further example of valid award criteria under Article 53 - the needs of handicapped people, which should be taken into account. In the case of transport services - for example better access to buses for handicapped people - would certainly be a valid criterion. There is no doubt about that.
My fifth point refers to the phrase 'economically most advantageous', which Mr Herman Schmid and a number of speakers mentioned. In reply to those comments, the most economically advantageous tender would be the result of a combination of economic but also qualitative criteria, and the latter would serve not necessarily to calculate the costs for the contracting authority, but would certainly help that contracting authority to make up its mind.
My penultimate point refers to labels, which Mr Jonckheer mentioned. As the common positions clearly show, the Commission is in favour of clarifying the role of eco-labels in public procurement and the possibility of referring to them when defining technical specifications. It should be kept in mind, however, that unlike 'ordinary' European standards, European eco-labels do not replace other competing eco-labels such as pluri-national ones. The Commission's proposals on eco-labels had foreseen such replacement, but this was not accepted during the legislative process.
The current situation is, therefore, that different eco-labels may exist side by side even if they cover the same aspects. It would therefore not be appropriate - indeed, it would be contrary to established policy in the environmental field - to introduce a preference for European eco-labels over other eco-labels. The Commission is conscious that references to the performances underlying eco-labels rather than to simply require the labels themselves may be more complicated for purchasers. This task has been rendered easier through a database created by the Commission which lists the different performances defined in eco-labels that can be used in connection with award procedures. I can add that a practical guide to green procurement will be published later this year.
Finally, I should like to deal with the questions put by Mrs Thorning-Schmidt and Mr Hughes as to why the Commission is going back on current law as interpreted by the Court of Justice in the Helsinki buses case. My answer quite simply is as follows: it is simply not true that the common positions are more restrictive than the interpretation of current law given by the Court of Justice in the Helsinki buses case.
On the contrary, through the combination of recitals and Articles, the common positions consolidate and clarify the possibilities offered by current law. They do not add anything to or subtract anything from current possibilities, but they have the merit of setting these out explicitly instead of having to rely on interpretations of jurisprudence with all the ensuing possibilities for different use and consequent legal uncertainty on this crucial issue. Moreover, they clarify that under the same conditions as set out by the Court of Justice, the use of social award criteria is also legitimate.
I should like to end by expressing the hope that in its vote Parliament will support the common position so that we can get these directives onto the statute book as quickly as possible.

President.
Thank you very much, Commissioner Bolkestein.
The debate is closed.
The vote will take place on Wednesday at 12 noon.
(The sitting was closed at 8.34 p.m.)

