Approval of the Minutes
President
The Minutes of the last meeting have been distributed.
Are there any comments?

Schierhuber
Madam President, may I ask that in the Minutes under the point relating to the Fifth Framework Programme on Research I also be referred to as the draftsman of the opinion of the Committee on Agriculture and Rural Development.

President
We shall arrange for that to be done, Mrs Schierhuber.

Apolinário
Madam President, my name is not on the list of Members present at the 9 a.m. vote, although I have notified the Bureau that I was present and voted in favour of an emergency debate on the Common Organization of the Market for olive oil. I should therefore be grateful if the Minutes could be amended accordingly.

President
That will be noted and the Minutes corrected.

Izquierdo Collado
Madam President, looking at yesterday's Minutes, it says that I voted in favour of Mr Berend's Amendment No 4, when I voted against. Please could it be corrected.

President
The Minutes will be corrected.

Puerta
Madam President, I should like the fact that I was here yesterday to be recorded.

President
That will also be done.
(Parliament approved the Minutes)

Wurtz
Madam President, I would like to ask if the Presidency has been duped, or if it is indeed aware of the content of the display outside Room 100, on the Sudetenland Germans?
It is a revanchist exhibition which coincides with an ongoing campaign by the German extreme right wing, particularly in Bavaria.
I think it is utterly intolerable that an exhibition which harks back nostalgically to the 1938 borders should be allowed to exist on these premises. I therefore request an explanation regarding this matter.

President
Mr Wurtz, to my knowledge, a mistake was made in preparing for this exhibition, in that the organizers made use of old brochures in French and German from the 1980s. You are quite right. It should not have happened. But, when the matter came to light, it was put right immediately. I myself was present at the opening of the exhibition yesterday. Former President Hänsch made the following comment about the exhibition. He said that we look at this exhibition with the idea in mind that in a united Europe Germans and Czechs, too, will become friends again. And I believe that in the same spirit we should accept the presence of this exhibition in our House.
I trust that you will accept this explanation and that we can now move on to today's agenda.

Müller
Madame President, I also attended the opening of the exhibition yesterday, and I should like to emphasize that Mr Hänsch did not only make the comments which you have just reported. He also quite clearly said something else which I think is far more important in the current discussion, namely that the debate on the Benes Decree cannot be used as some sort of precondition for the accession negotiations we are currently holding with the Czech Republic. That seems to me to be the most important point in political terms!

Green
Madam President, as the issue of exhibitions has been raised, perhaps I could ask, through you, that the College of Quaestors and the Bureau look at the whole way in which this Parliament, both here and in Brussels, is used for some of the most ridiculous exhibitions - commercial events which make us look more like a bazaar than a Parliament.
My group is regularly disrupted, not just by exhibitions right outside Room 100, but by the accompanying noisy receptions. Yesterday there were trumpets and trombones outside our meeting room. The place is becoming a circus and it has to stop.

President
Although we have strict rules, they do, nevertheless, need to be reviewed. I will pass your comments on and we will then examine whether new rules need to be introduced.

de Vries
Madam President, another issue; I would like to ask for your help, and through you for the help of Mr Gil-Robles.
In my country there has been a stir in the media about a false report concerning the European Parliament. In the Dutch media a report is circulating suggesting that the European Parliament has proposed that its members should receive a monthly salary of between ECU 9, 000 and 13, 000. Last night Dutch television asked a large number of Members of the Lower Chamber for their opinion, and they said it was an absolute scandal that the European Parliament is demanding such a salary.
Madam President, we all know that our Parliament has made no such proposal and that no proposal whatsoever from any body exists. I am extremely worried about the negative reporting in my country, which is not always based on adequately checked information.
I would like to ask you whether you could ask the President to issue an official denial, so that this type of extremely negative and damaging reporting will not occur in future. I am grateful for your assistance.

President
Mr de Vries, I will pass your comments on. Incidentally, you yourself said that they were not contained in the draft.

Martens
Following on from what Mr de Vries has said, a telex issued by the official Belgian press agency Belga mentions remuneration of between ECU 9, 00 and 12, 000, in other words, 33, 600 to 488, 000 BF per month. This might be a possibility, according to a letter from the chairman of the working group to the President of this Parliament, José María GilRobles. The contents of the letter were leaked before the Bureau was able to discuss the issue. I call on you, Madam President, to ensure that the Bureau denies this report forthwith, and confirms that no decision whatsoever has been taken yet on this matter, that it merely appears in the report of the working group, and that the Bureau has not made any proposal in this respect.

President
Mr Martens, this matter appears on the agenda of this afternoon's Bureau meeting. I shall pass on your comments.

Anastassopoulos
Madam President, you know very well, as do all the Members of the Bureau, that no decision has been taken and that no proposal has been submitted so far. So these are all just rumours and nothing else.

Maij-Weggen
Madam President, in principle I would like to endorse fully what Mr de Vries and Mr Martens have said. But I would like to warn you about one thing. Three days have elapsed between the leaking of this inaccurate report and the reaction of the Presidency. For three days false reports have been circulating on Dutch television and in the Dutch media which can no longer be repudiated given today's media circus. This is our big problem. To my mind Parliament's Information Office should react instantly to such issues, and not let them run their course for a week, with the result that we are being hounded with all sorts of false insinuations.

Aelvoet
Madam President, ladies and gentlemen, it is true that no decision has been taken within any European Parliament body on a statute for Members of the European Parliament, or on the issue of a possible salary. But it does appear to be true, and in that sense the report from Belga was correct, that a covering letter exists which mentions a possible salary figure of between ECU 9, 000 and 12, 000. So this figure appears in a covering letter which was apparently leaked. To that extent we have to make it very clear indeed that not one single decision has been taken. Nevertheless, proposals have been made, and a covering letter exists which could give rise to this kind of interpretation.

Green
Madam President, reports like that are very damaging to this House. The figures which Mrs Aelvoet is quoting are certainly not a proposal for a salary and she is absolutely wrong to insinuate that somebody in this House is putting them forward on that basis. I very much regret that David Martin, who presided over the working group for the Bureau, is not here to explain that situation in public. That really is a tendentious view that Mrs Aelvoet has just put forward and it is exactly the thing that does such damage in the media across the European Union.

President
Thank you very much, Mrs Green. In response, let me say the following. Mrs Aelvoet said that Parliament has not yet reached a decision. It has not yet reached a decision on the current matter. There is an old decision of Parliament to draw up a statute and there is also, as you are aware, a commitment in the Treaty of Amsterdam which has not yet been completely ratified. A working group has been set up within the Bureau involving Members from various committees. This working group has drafted a document which was submitted to the Bureau this week. As yet no decisions have been taken and this draft document makes no reference to proposals of the sort mentioned in media reports, by which I mean salary levels. There is really no reason to give the impression that this is the case.
The Bureau and, of course, the relevant committees and Parliament itself will take as much time as is required to prepare any new statute for Members of the European Parliament in the appropriate manner, that is to say on a sound basis. The matter will not be rushed, it will be properly discussed. I do not believe that there is anyone in the House who does not share the view that a uniform voting system, such as the one we will be agreeing upon in the next part-session in July, should go hand in hand with a uniform statute.
The leaking of information in advance of a vote, or the alleged quoting of facts from letters which were never in the letters in the first place...
... unfortunately, that is the sort of thing that happens. I shall report it at the Bureau meeting this afternoon, and I shall urge that we issue an appropriate statement clarifying the situation and clearing up any misunderstandings.

Calendar of part-sessions 1999
President
With regard to the calendar of 1999 part-sessions, I suggest that the vote should be adjourned until Thursday lunchtime, when as you know, since we discussed the matter yesterday, the Legal Service's opinion on the admissibility of the amendments seeking to bring forward the July part-session will be available. The plan is to bring forward the sitting by one week, but as it is a constituent meeting, we must first establish whether this is legally permissible.
Are there any objections to this proposal?
(Parliament agreed to this proposal)

Middle East peace process
President
The next item is statements by the Council and the Commission on the peace process in the Middle East, followed by a debate.

Henderson
Mr President, thank you for giving me the opportunity to open the debate on the Middle East peace process.
The European Union remains deeply concerned by the continuing stalemate in the Middle East peace process and by the threat to regional stability such deadlock poses. This is very much reflected in the conclusions of the Cardiff Summit which were finalized yesterday. The sides must show courage and vision in the search for peace, based on the principles agreed at Madrid and Oslo, especially the essential principle of land for peace enshrined in the United Nations Security Council Resolutions 242 and 338.
The Union remains committed to its positions of principle regarding the peace process, as set out in its previous declarations, particularly the call for peace in the Middle East, issued in Amsterdam in June 1997. These principles were reaffirmed in Luxembourg in December 1997 as the essential guidelines for a European Union policy aimed at facilitating progress and restoring confidence between the parties.
The European Union has intensified its efforts to help the sides overcome this stalemate by playing an increasingly substantive role in the peace process. The British Prime Minister, as President of the European Council, was involved in talks between Prime Minister Netanyahu, President Arafat and Madeleine Albright in London in May. The European Union participated in negotiations on interim economic issues before and during the Prime Minister's visit to the region from 17 to 21 April. The British Foreign Secretary, in his presidential capacity, also visited the region from 15 to 18 March. The European Union has also concluded a joint declaration with the Palestinians on security cooperation and is implementing a counter-terror assistance programme to assist the Palestinians. Our special envoy, Ambassador Moratinos, has played a key role in these efforts and is continuing efforts to close gaps and move the peace process forward.
The European Union has deepened its cooperation with the United States on the peace process. It strongly supports the efforts of the United States to gain the agreement of the parties to a package of ideas which, if accepted, would open the way to the relaunch of final status talks. The European Union has welcomed Palestinian acceptance of these proposals and called upon the government of Israel to give a clear and positive response.
The profound commitment of the Union to fostering peace in the region is reflected in the scale of its economic support for the peace process. From 1993 to 1997 the Union and its Member States provided approximately ECU 1.68 billion in assistance to the Palestinians and to the United Nations Relief and Works Agency for Palestinian Refugees. The Union's Foreign Ministers agreed at the General Affairs Council meeting on 23 February to renew the European Community aid package to the Palestinians beyond its expiry at the end of this year.
The report on a new Council regulation to extend this assistance programme, drawn up by Mr Tomlinson, reflects an understanding of how important this assistance has been, and will continue to be, to sustaining the peace process. It clarifies the legal basis for the various facets of the assistance and reflects the need to look at needs beyond the two years for which the assistance has been extended.
The Union has also worked hard, through its formal dialogue with Israel on the issue, to improve the Palestinian economy, especially freeing up the movement of goods and people. The presidency and Ambassador Moratinos have taken the initiative to intensify this dialogue. A recent communication from the European Commission proposing cumulation of origin between Israel and its neighbours, including the West Bank and Gaza, for manufacture exported to the European Union will bring economic benefits to all partners.
A second Commission communication regarding implementation of the European Union-Israel agreement has also been published. It raises complex legal, political and technical issues, including the status of products from Israeli settlements. These issues will be discussed with Israel and considered by the Council in coming weeks.
While our focus has been to move the Palestinian-Israeli track of the peace process forward, the European Union remains concerned at the lack of progress on the Syrian and Lebanese tracks as well. There is a need for a continuing effort to reinvigorate them and sufficient flexibility on the part of the parties to allow the talks to resume, and that will be our main objective in the period ahead.

Marín
Madam President, Mr President-in-Office of the Council, ladies and gentlemen, despite the constant efforts of the United States and the European Union at all levels, the Middle East peace process has been in complete stalemate for almost a year and a half. As Mr Henderson says, it is true that under the British Presidency the European Union has intensified its support for US efforts at mediation.
Despite sometimes taking different stances on certain important aspects of the peace process, the United States and the European Union agree about one substantial element: at these times of crisis, it is essential to work together in order to break the deadlock. In this respect, the visit to the region in April by the British Prime Minister, Mr Blair, only served to confirm the serious nature of the crisis in the peace process. One tangible result of that visit was the meeting in London on 4 and 5 May between Americans, Palestinians, Israelis and the EU presidency. Unfortunately, that meeting did not manage to shift the stalemate as regards the outstanding technical questions: the Gaza airport and port, free movement between the West Bank and Gaza and, in short, the whole joint dialogue agenda with which this Parliament is so familiar.
As you know, the stalemate still persists, and after the London meeting President Clinton himself even had to call off the three party talks in Washington because of Israel's unwillingness to accept the US compromise proposal.
In that sense, we fully share the point of view expressed by Mr Henderson. It is impossible to make real, credible progress without complying with all the agreements which have been freely negotiated and signed by the parties, and without respecting the principles upon which the peace process is based - essentially the "land for peace' principle.
The latest violent incidents and Israel's recent initiatives, again involving the question of settlements, illustrate how volatile the situation is and how urgent it is for all sides to accept the US proposal, which in itself is a minimum proposal with regard to Israeli redeployment in the West Bank.
Despite having reservations, the Palestinian Authority has formally expressed agreement in principle with the US proposal. In the Commission's view, it is now up to Prime Minister Netanyahu to show the necessary flexibility in order to revitalize the peace process as soon as possible, by accepting the US proposal which, I repeat, is a minimum proposal but which, as things stand, is the only realistic proposal for further progress along the road to peace.
Lastly, the European position on the peace process has not changed. In the conclusions of the European Council in Cardiff, as you will be able to see when Parliament receives a copy of the resolution adopted by the heads of state and government, the Union has once more confirmed, point by point, as it could not fail to do, the position which has been traditional ever since Venice, Luxembourg and Amsterdam, and has now of course also been confirmed at the Cardiff Summit.

Swoboda
Madam President, Mr President-in-Office of the Council, Commissioner, I should like to outline my group's view on this difficult and delicate issue in 10 points. One: We are fully in support of the Oslo peace process. There is no way around it. It must be respected and - as the President-in-Office of the Council has already mentioned - we would also like to see progress in relation to Syria and Lebanon and peace treaties with both of these countries. Unfortunately the Israeli government, which had started to embrace a more peaceful attitude, in particular towards Lebanon, now seems to have lost the courage of its convictions.
Two: the European Union is part of the peace process. We must not allow ourselves to be squeezed out of it. Our political, moral and economic commitment makes us a part of this peace process. We do not want to enter into and fulfill this commitment in place of the USA, but rather with the USA as an indispensable partner in the peace process.
Three: Europe is sometimes reproached for interfering in matters which do not concern it. But we are not interfering in someone else's business, it is our business. The breaking off of the peace process by the Israeli government disrupts the good neighbourly relations which exist between Europe and the other countries of the Mediterranean rim. We are right to fight it, for the Barcelona process is a vitally important process for all the countries of the Mediterranean, including Europe, and must not be derailed.
Four: We recognize completely and without reservation Israel's right to exist and to maximum security. But we have no time for terrorism. Terrorism must simply be fought at its political, economic and social roots and the issue of security must not be used as a pretext for not continuing the peace process. On the contrary, we urge the Israeli government to do everything in its power to ensure that its attitude does not actually promote terrorist or radical movements in the Middle East.
Five: The European Union must continue its policy of strengthening the economic infrastructure of Palestinian areas. The airport is ready and the Palestinian authorities have made an undertaking to involve Israel in their security plans. It would be possible to plan the port, and it would be possible to start the building work soon. This is absolutely essential, and Europe's commitment on this point remains unshaken.
Six: We all want to support - primarily through financial aid, but also by giving political and moral backing - those people who are fighting for human rights in Palestine, those who are fighting to stop financial abuse and corruption, who are also advocating that good relations be forged with the Israeli population. We want to give them our clear support. That is a commitment which Europe has and must take on.
Similarly, and this is my seventh point, we also want to support all those peace-loving forces in Israel who want to build bridges to the Palestinian and Arab population, who recognize the rights of everyone in Israel - including the Arab population - and who, above all, are promoting religious tolerance. On my last visit, I was particularly impressed by the people who are fighting for peace and making a stand against fanaticism and religious intolerance in their own country for Jewish religious reasons.
Eight: We know that Jerusalem is a particularly delicate issue. We understand the emotion felt by many Israelis, but we also understand the emotions of the Arab population. For this reason we are against any measures designed to change the ownership situation unilaterally prior to negotiations on Jerusalem. For this reason we oppose all radical groups and the tolerance being shown by the Jerusalem city authorities and the Israeli government towards certain radical groups.
Nine: We are absolutely against the use of sanctions as a means of managing bilateral relations between the EU and Israel. We are also absolutely and unequivocally in favour of adherence to binding agreements and support the Commission in its efforts to ensure that they are respected.
Ten: We recognize the right of the Palestinians to their own state and we hope that Israel will play a role in its founding, so that it can be founded with and not against Israel. Time and again Simon Peres stressed that the existence of Israel requires the existence of an independent Palestinian state in peaceful co-existence and Europe should and must encourage this peaceful coexistence.

Oostlander
Madam President, the Israeli-Palestinian question, Middle East issues, are exceptionally complicated and therefore call for great care on our part when we discuss them. They are complicated because of the relationship between Israel and the Palestinians; both are able to claim rights, rights which sometimes stand in each other's way. Then there is the history of mediation by the United States, a process which in itself requires exceptional caution. If we become another party to the process as well, we will have to do our best to speak with great wisdom. Still, it is a good thing that the European Union is also involved, because - and I fully agree with Mr Swoboda - we have great historical as well as current responsibilities in this region. That is something we cannot get out of. We cannot say that the others should deal with it, that Europe is neutral. That is why it is also important that we have someone, Mr Moraltinos, who has been mandated to go to the region to see what the European Union could do to help resolve the problems. This obviously requires the Council to have a clear position, because the confused foreign policy decision making process in the Council, as we know all too well, merely leads to more grief. Council decision making will also have to be subject to reasonable control by the people's representatives. Just on whose behalf are they speaking? Are they really speaking on behalf of the European citizen, or this unclear?
Madam President, all too often we witness the governments of Member States taking independent action. This has been the case in the recent past, and this trend is continuing now. Of course, this is scarcely helpful when issues need to be resolved. You cannot visit the region, and one moment speak from a French position, and the next from a French, Dutch or English position. We will have to replace this with action on behalf of Europe. Because, as things stand at the moment, each Member State can maintain its own double agenda in its relations with Israel and the Palestinians. Sometimes it is better to keep your mouth shut, if you cannot really speak on behalf of Europe.
The complexity of the situation has of course grown out the fact that the political movement around Netanyahu has gained so much influence. This will not have the desired effect for Israel, either. The increased radicalism on all sides, both in Israel and amongst the Palestinians, might sometimes even tempt us to express ourselves in radical terms as well. Prudence is called for at such times. However, it is a great problem that the political commitments entered into by the previous government are not being honoured.
Madam President, the Group of the European People's Party therefore supports the resolution wholeheartedly. It is a good thing that Israel's policy on colonization is being changed, given the frustration of economic development, and that it is being replaced by confidence-building behaviour which leaves room for the construction of a civil society on both sides and for person-to-person meetings in order to promote peace in the region.

Bertens
Mr President, the peace process is at a dead end and every possible pressure is needed to get this process going again. Tangible results are needed to reinject some dynamism into this peace process. Further deterioration and lack of prospects for the Palestinians will not increase security for the state of Israel. That is why it is in Prime Minister Netanyahu's interest finally to enter into agreements about further withdrawal from the occupied territories. American plans in this direction could break the impasse, and therefore deserve every support, but great vigilance is also required.
The threat made by Israeli representatives that the European role in the peace process should be conditional upon the solution of trade differences is unacceptable. After all, under international law, the settlements do not belong to the state of Israel. The Union should not give trade preferences to products from these settlements. We must not put a premium on the unlawful enlargement of these settlements.
Netanyahu and Arafat must return to the dialogue. A great deal has been achieved and we must not throw that away now. In addition, our entire Barcelona process in relation to the Mediterranean stands or falls with this dialogue. The Union must support the US in calling for the opening of the Gaza airport, the accumulation of the rules of origin regarding regional trade and promotion of social contacts between the countries.
I hope that the Austrian Presidency will display more tact than the British President-in-Office, Mr Cook. Without an agreement about withdrawal from the occupied territories, there will never be a basis for the final status talks due to start in May next year. I wish Mr Arafat, Mr Netanyahu, the Palestinians and the Israelis wisdom, political courage and vision.

van Bladel
Mr President, in recent years I have had the privilege of visiting the Palestinians in the Palestinian territories three times. I have observed that enormous progress has been made; there is better infrastructure, the general appearance of Gaza has changed and improved. A rush of building is taking place on the West Bank. Recently, we also spoke with a Palestinian entrepreneur who has started to construct a big warehouse to give shape to the industrial zone on the border with Gaza. So not everything is negative. Yet I still sense an undercurrent of tension and dissatisfaction amongst the Palestinians, and rightly so. For the process is stagnating. But I am also sensing an increasing dissatisfaction amongst the Palestinians with regard to the judicial process in their own territories. That is why I would have preferred it if our resolution, under point 4, had not spoken about a joint EU-Palestinian security committee, but rather joint EU-Palestinian legal support.
The meeting with the Hamas leaders was not very promising. They were not positive about the existence of Israel in the medium term. I find that extremely difficult. Nor has this paragraph been removed from the Palestinian Charter as yet.
We also visited the airport. I thought it was encouraging to see that, architecturally, this airport fits well with Arab culture; but there is a lack of equipment. People are not able to do their work at the airport, and our resolution underlines this point. But, in all honesty, Israel has a right to security. The Palestinians have a right to progress. In my view we need a whole package for the region. If Israel makes progress with Syria and Lebanon, then this should also be possible with the Palestinians. Let us insist above all that Lebanon and Syria make peace with Israel, then there might be some movement with the Palestinians. I hope that the Social-Democrats in Israel will also make a positive contribution, because that is missing somewhat at the moment. I find this a pity.

Wurtz
Madam President, I am convinced that if all Members of the European Parliament had an opportunity to visit the Palestinian territories, if they could see and hear what our delegation has just seen and heard, there would be widespread agreement amongst us that Europe's current timid "wait-and-see' attitude needs to change at a political level with regard to the Middle East peace process.
In my opinion, one thing is clear: since Madrid and Oslo, the dividing line no longer lies between Israelis and Palestinians, or Arabs in general, but between those who wish to support and those who wish to torpedo the peace process. There are people who wish to torpedo the peace process on both sides, with one difference: since the tragic death of Yitzhak Rabin, these are the people who now hold power in Israel. It is thus in the common interest of the peace-making forces on both sides, which are lastingly interdependent, to stop Mr Netanyahu and the extremists he relies on burying the vital principle of land for peace whilst there is still time. It is in their common interest to rebel against all measures which destroy the atmosphere of trust essential to peaceful cohabitation, and even more essential to long-term cooperation. I am thinking of the expulsions, the destruction of houses, the blockade of the territories and above all of the extension and multiplication of settlements, including in East Jerusalem. Calling on Europe to use - as it has successfully done in the past on the initiative of this House - its economic, scientific and technical relations with the State of Israel to push for a revival of the peace process would not amount to sanctioning Israel but to supporting the weakening of Mr Netanyahu by those Israelis in favour of peace. I might add that, far from embarrassing the United States in their role as sponsor of the process, this determined attitude on the part of Europe would create conditions more favourable to their intervention.

Tamino (V).
Madam President, the recent visit by the European Parliament's delegation for relations with the Palestinian Legislative Council highlighted a truly dramatic situation. We are faced with a serious deadlock in the peace process, and we were able to see that the settlement of new land was the response to the request put forward by the Oslo Accords, which was 'peace for land' . Instead of 'peace for land' , we have learned that on 9 June the Israeli government decided on a new settlement of the Mount of Olives in the heart of East Jerusalem.
Given the context, the living conditions of the Palestinians are obviously dramatic, in particular because of the shortage of work, especially in Gaza. The situation is characterized, on the one hand, by the Palestinian authorities' preparedness to respect the Oslo Accords and, on the other hand, by the Netanyahu government's intention not to stick to the commitments made.
In view of this situation, immediate steps must be taken at least to ensure that the systems of communication between the West Bank and Gaza are guaranteed, that the now completed airport is opened, and that work begins to build the port. Obviously we must understand that a year from now, Arafat will have no choice but to declare Palestinian independence upon expiry of the Oslo Accords, even if he does so unilaterally.
It is therefore obvious that we must do all we can to make sure that the Palestinian National Authority is able to play its role and is in a position to continue its action, including in economic terms. This is why it is very important that the Tomlinson report be approved. I believe that in view of this impasse the extremist and intransigent fringes on both sides will inevitably grow and propose military solutions. If we want to avoid this catastrophic solution, we must act as soon as possible to relaunch the peace process, using whatever form of pressure and diplomatic effort it takes. We therefore go along with the statement by Commissioner Marín and with what the Council said, but we are calling for even more decisive action.

Pradier
Madam President, there has been too much moaning about the fate of the people of the Occupied Territories at the hands of the Israeli army. It is no longer the time for pity or hypocritical snivelling. Let us now defend justice, the law and, above all, the resolutions voted for by the United Nations, and the documents which have been signed by common agreement by the parties present.
A code of conduct has been adopted, a timetable fixed. These decisions, this timetable and this code of conduct must be respected. Although they are not completely disregarded at the moment, the peace agreements are certainly being damaged and the peace process seems to be on its last legs. There is clearly a reason for the procrastination, delaying tactics and indirect remarks of the Israeli authorities.
Extremists on both sides are opposed to the renewal of serious negotiations. First and foremost amongst these are the religious fundamentalists, whose interpretations of the Koran and the Torah are, to say the least, questionable. With regard to the pressure these extremists can exert on the authorities, it is clear that the Israeli government is still extremely vulnerable. The sensational declarations regarding an "eternal capital' and the thundering arrival of armed settlers in the Occupied Territories, the withdrawal of residence permits in Jerusalem, the fact that Arab citizens of that city find even their right to live there challenged, the blockade of Ashdool with regard to equipment which would enable the opening of Gaza airport: these are so many factors which quite seriously compromise any further progress.
But we also have to consider the problems of security and terrorism. It is true that in this respect, nobody is safe, neither Israel nor, unfortunately, perhaps in the short-term, Palestine. In any case, terrorism can come from any quarter and Israel itself lost its Prime Minister in this way. The fight against terrorism, and against those who incite it, is clearly a necessity. We must make sure that the American diplomatic effort is supported, for without it nothing will be possible. To date, and for a number of years, American diplomats have displayed a wealth of inventiveness and ingenuity. We have an important role to play in ensuring respect for previous agreements and, in relation to this, the Commission's proposal regarding products coming from Israeli settlements outside Israel should be welcomed. By giving these products - which have clearly come from Arab territories - the advantages reserved for Israel, we are making a gesture which, although it is clearly not going to ruin the Israeli economy, will nevertheless have a precise political significance. You only have to see the reception given to this proposal in the Israeli press and by Israeli government circles in general to understand that the demand for respect of the agreements, in this case Article 38, is there, which is perhaps an indication of the direction we should be taking in the future.

van Dam
Madam President, the potential impact of the European Union on the Middle East peace process is primarily indirect, and it could be both positive and negative. It looks as if it will chiefly be negative. How can the Union promote peace when it denounces the policy of one party whilst acting anything but diplomatically? A particularly striking example is the Commission initiative to exclude products from Jewish settlements from the preferential trade conditions applying to Israel. The Commission's thinking is that the settlements on the West Bank do not belong to Israel. The Commission also wants to subject the goods imported from Israel to special controls, because the country is alleged to tamper with certificates of origin, and is also exporting goods from Palestinian territory under the description "Made in Israel' .
I would like to ask the President-in-Office whether he is behind the Commission's stance. Is this stance not extremely unwise in view of the current negotiations? If Parliament should conclude that Israel is not respecting the peace agreements, this would be both flawed and premature. The Oslo accords are also being violated by the Palestinians, thus they are not respecting them either. In addition it is debatable if we can already pass judgement on whether the accords are being met or not, whilst the term which has been set in them has not yet expired.
The Oslo Accords and the interim accord request a regrouping in three stages according to unilateral decisions by Israel. By regrouping its troops somewhat, the government of the country has in any case acted formally in accordance with accords, which make no mention of the relationship between these three phases.
Pedantic statements will not bring peace any closer. Instead of wanting to play the leading part in the Middle East, the European Union could follow the example of the United States, which just recognizes the peace process and tries to support it.

Muscardini
Madam President, peace is something which cannot be relinquished and it risks remaining a petitio principii if governments, public opinion and the international community do not make the necessary efforts. As far as peace in the Middle East is concerned, we must honestly ask ourselves whether the European Union has done all that was essential to help restart the interrupted process. When an agreement falls apart, when an accord disintegrates, no one side alone is responsible. There is a series of contributory causes that fuel the political dialectic, which in turn risks radicalizing positions and undoing the efforts of men of goodwill who on both sides are trying to rebalance the situation so that dialogue may resume. For this is the crucial point of the tension between Israel and Palestine; whatever the direct cause of the interruption of the process, there is no doubt that the resumption of dialogue would bring tension back into the right proportion and make it possible to assess the situation of the opposing sides, with our eyes cast to the future.
A people decimated by the holocaust cannot continue to live for generations in a permanent state of tension: peace is its foremost interest, a vital interest. To help Israel find peace again also means helping the Palestinian people and preparing a liveable future for the entire region which is in need of economic and social development. Many of the European Union's efforts are frustrated by the absence of a political union, of a common foreign policy. A short while ago we were talking about funds earmarked for the Palestinians. Well, we would like to know why then we see poor and desperate people on television. Where has this money gone? And when we are working in this House on rather bureaucratic and unimportant matters, I would also like us to remember the faces of those Israeli children who sing as they leave school despite the fact that they are being watched over by people armed to defend them against another massacre and another tragedy. Let's remember that the European Union has a role to play quite apart from just being a bureaucratic or economic union: there is also a moral choice to which we must return.

Colajanni
Madam President, I must say that, after repeated visits by our delegation these past four years, we have recently found a situation more difficult than in the past. For the first time since the Oslo process began, there is a general loss of hope: this is very dangerous and we must unfortunately consider negative developments possible. None of the difficulties has been overcome, from the corridor between Gaza and the West Bank to the blocking of the settlements, from the prisoners that are still in jails to the veto on the Gaza port and now completed airport capable of operating, to the consolidation of the Israeli presence in East Jerusalem, etcetera.
Regarding the second phase of the Oslo Accords, the proposal by the United States of a partial withdrawal from 13 % of the territory, accepted by the Palestinians - although they do not agree with this - is still, after much delay, awaiting a reply from Israel. As time passes, all the extreme components of Israeli and Palestinian society are growing stronger. Arafat especially is in extreme difficulty and whoever thinks that a weaker Arafat would help matters is totally wrong! What can we do? There is little time left before the Palestinian side issues a unilateral declaration of independence, according to the timetable of the Oslo Accords, and this dictates a political horizon to all the forces that are pro-peace.
The Union must step up its political presence in the area with a series of initiatives. First of all, it must insist so that the United States makes its proposal official in order to obtain an answer from Israel. We can no longer wait for and avoid this necessary moment, and it is no use skipping it now and proposing a peace conference, as was recently done. Yes, we must propose a peace conference if the reply to the United States' plan of withdrawal is no, so as not to leave a dangerous political vacuum. Then the promoter of this conference will have to be the Union, not an individual European state but the Union, and as such it must be the full-fledged promoter with the United States and other partners. Now is premature!
Secondly, the Union must ensure funds for Palestine. We cannot now cut off support which is essential in maintaining Palestinian autonomy. Thirdly, the Union must endorse - I mean the Council and Parliament, and the latter is doing this with a compromise resolution we are voting on today - the Commission's two initiatives to implement the association agreement with Israel and to introduce mixed origins for the region's products; it is not a technical matter, it is a proposal based on international law and on the association agreements and it is also very important politically. Fourthly, the Union must encourage and further develop Euro-Mediterranean policy and the MEDA programme.
In Palermo, the Euro-Mediterranean council gave renewed usefulness and credibility to Barcelona; it was a process in crisis. There is the will to go forward, the new regional and interregional developments have been defined and the choice has again been made to earmark a global figure for funding equal to the previous figure. All this is to be decided in Stuttgart in April. This, too, is a fundamental contribution of the Union to maintain hope and ways of finding peace.
Finally, I must mention the initiative launched by the European Parliament: in Malta. It was decided with the parliaments of the Mediterranean to set up a forum of parliaments of the Mediterranean in Brussels in October. This, too, I think is useful. The Euro-Mediterranean council in Palermo considered it positive. It is part of the work of this Parliament, and the aim is to develop the people-to-people relationship, if we can call it that, at various levels. We have promoted and will continue to promote meetings and dialogue between Israeli parliamentarians and the elected officials of the Palestinian Legislative Council. We are trying to initiate contact between the mayors of Israeli towns and Palestinian towns and encourage cooperation and collaboration between them. I believe that this forum of Mediterranean parliaments is useful too.
This is what Parliament can do, and I believe that it would be a good idea for it, too, to step up its action.

Dimitrakopoulos
Madam President, Mr President-in-Office, Commissioner, ladies and gentlemen, I think that today's debate shows that we all agree that our problem is no longer what is happening in the region. It is not what recommendations have been made and must be made, but it is how existing recommendations, and the initiatives that have already been taken, will be implemented and bring about a result. I would particularly like to address the Council, which I thank because it has in fact done a great deal, when I say that the key to the affair seems to be for us to change the presence of Europe in the Middle East.
At present we have a mediator, a great many governments and a Commission office, and that is the first issue we must tackle. It would be much more effective if, instead of mediators, instead of a multiplicity of opinions, we set about creating one body, in which all the institutions could participate and which would be headed by an individual with a proven knowledge of foreign policy and of the problems of the region. We would then get far more results.
The vast majority of economic issues have to a certain extent been tackled. The Commission has done an excellent job of work though, of course, some additions are necessary, especially concerning the availability and management of resources. What remains of significance are the prerequisites for a solution. The prerequisites for a solution and for peace are both political and military and are not simply a question of relations between Israel and Palestine. They extend much further than that, especially in the wake of the new political realities. I am referring not only to nuclear tests, but to countries such as Iran, because although we quite rightly talk a lot about Syria and the Lebanon, there are other countries such as Iran which influence or try to influence the situation.
Madam President, Mr President-in-Office, Commissioner, I think we have arrived at a point where we have no room for manoeuvre. It is therefore important that, over and above the recommendations, the ideas and the initiatives, which are all extremely important, we start out from the institutions. To achieve a satisfactory outcome, we need a new framework which will secure the continued presence of Europe in the region and which will also ensure actions in concert with the United States, though I would go as far as to say that there may be other powers in the world who will take an interest.

de Clercq
Madam President, during the past 16 months, little or no progress has been made in the Middle East peace process. Fortunately, since last week there appears to be some movement in the negotiations following the latest American proposals. We must conclude that the European Union has, in the recent past, once again failed to play a leading or convincing role in this issue which is so important to us. The initiative and the direction of the present talks are entirely in the hands of the Americans. The European Union's weak political role is out of balance with our major financial contribution, our economic interests and our security. The balance must be restored as a matter of urgency.
Europe should no longer be merely a provider of funds, the biggest donor in the world, but more than ever must make a political contribution to a solution involving lasting peace. This is clearly why the Union must be able to speak with one voice to the outside world and to pursue a single line of European diplomacy.
And now to the European Parliament. I believe that the European Parliament can certainly help improve the mutual understanding between the Israelis and Palestinians; not by means of dictates, resolutions or threats, but by supporting so-called people-to-people projects, and especially by making a contribution to the dialogue between the people from both sides. Real peace starts with the people, the people in the region itself who live amongst each other on a daily basis, including children and students. Real peace does not start at the top, but at a country's grass roots. This is where we have to nurture mutual respect and build a strong foundation for a hopeful and peaceful future. That is where our role as the European Parliament lies.

Caccavale
Madam President, President-in-Office, Commissioner, ladies and gentlemen, we must ensure that this Parliament does not just act like a notary, in other words, that it should not merely record how the situation stands.
First of all, I dispute the fact that the peace process is stalled; instead, it is my view that the peace process in the Middle East is moving backwards, clearly and extremely dangerously backwards. Therefore, it is not true that we are stalled: the situation is growing considerably worse. There is radicalization that can be seen now on both sides - Israeli and Palestinian - and this is making it extremely difficult for those who still believe that peace is the only instrument, the only basis, the only sure way for effectively bringing about development, and therefore cooperation, between Israel and the Palestinians. It goes without saying that Arafat is the one who risks the most and the responsibility of a definitive collapse of this peace process would inevitably end up benefiting those who believe in religious extremism, fundamentalism; it would thus sweep aside those who have worked for peace, beginning with Arafat himself. But I see that Netanyahu, on the other hand, also has the same problem: his radical extremists from the religious parties are preventing any progress in the peace process. It should be said, however, that this is an excuse on the part of the Israelis. Personally, I consider it unacceptable that Israel has not yet given a reply to the American proposal, which was in itself a compromise, for a partial, a very partial withdrawal - the famous 12 % or 13 % or 11 % - from the Occupied Territories.
It has also been said in this sitting that Europe has been absent. I also dispute this. Unfortunately, Europe has not been absent, in the sense that it has sewn further confusion: the Middle East peace process is the mirror of Europe's impotence and incapacity. Chirac went along one day and said something; another day Cook went along and said something else; then Kinkel went and said something different again: this is the sign and signal that Europe not only does not have a role, but at this moment has a negative role. We continue to be 15 political dwarfs unable to have a single voice in any peace process, in any foreign policy process currently under way in the world.

Mohamed Alí
Madam President, once again we are debating the crisis in the Middle East.
Once again, the Israeli Prime Minister, Mr Netanyahu, is failing to comply with the agreements which were freely accepted and ratified by his parliament. Furthermore, he is blocking any attempt at negotiation, as was seen at the meeting of 4 and 5 May in London. Even the US attempt to initiate new negotiations with a minimum proposal has also been blocked by Israel, as Mr Marín has confirmed.
Obviously, Israel does not want to comply with the agreements. Israel is not withdrawing from the territories, but is continuing to occupy them and keep thousands of Palestinians in prison. The United States has lost its role as mediator, and the European Union should put pressure on Israel by subjecting its agreements with that country to certain conditions.
Compliance with the international agreements is the only solution, and the European Union and its envoy should play a key role.
We in the Union should block our existing agreements with Israel and promote all efforts to help the Palestinian National Authority. The Gaza port and airport and the recovery of the territories are demands which cannot be withdrawn. If Mr Netanyahu wants security, he must understand that security is only possible through the agreements.

Gahrton
Madam President, we all know that the Israelis could not care less whether we speak with one voice, fifteen voices or a hundred voices. The important thing is whether we talk or whether we act. The Israelis said right up until Camp David: 'We want nothing but peace.' Since then they have had peace with Egypt, with the PLO and with Jordan. They could also have had peace with Syria and Lebanon if they had kept to what they said: 'We want nothing but peace.' But we know that for 31 years they have built new settlements, have killed children who threw stones, have ignored UN resolutions and ignored treaties they have entered into. They are building 'Greater Israel' in line with the intentions pronounced by Netanyahu's mentor, Jabotinsky, as long ago as the 1920s. We all know this. We know that they ignore talk and resolutions. So why are we not prepared to move from words to deeds?
Today there is an interesting article in Libération which asks just that question. Why act and intervene only in Kosovo? Do only European massacres get the European Union to move from words to deeds? I do not mean that we should send troops to Israel - of course not. However, people say that the EU is an economic giant, but a political dwarf. Let us make use of the fact that the EU is an economic giant. Let us use that economic power. Let us move from words to deeds and actually apply proper economic sanctions. I am convinced that that would be able to influence Israel. If we do nothing, I am absolutely sure that the 1990s will see a war in the Middle East, just like every other decade. On this occasion the EU should at least do something and move from words to deeds through peaceful, non-violent, yet powerful sanctions against Israel, which is in breach of all international laws.

Antony
Madam President, ladies and gentlemen, the lands of the divine revelation of the Decalogue and the Gospel have rarely known peace, even more rarely have they known respect for dignity and the rights of all communities who have lived together there for centuries. As the end of the 20th century approaches, it is everybody's wish that a true peace process may be initiated and concluded.
This will be difficult to achieve. The conditions are, however, clear. Israel must once and for all have the right to peace secured via guaranteed borders, whilst the rights, dignity and freedom of the Palestinians must be respected. It is an abomination to continue to coop them up in unacceptable apartheid-like "townships' and it would be an illusion to believe that this can continue without further conflict of unpredictable extent. Historically speaking it is the Palestinians' home as much as it is the home of the Jews; they have the right to a free, independent and sovereign State.
But Syria and Lebanon are also going through a peace process. Lebanon has suffered from the presence of hundreds of thousands of Palestinians on its soil who were thrown out by Israel and who quickly evolved from welcome refugees into revolutionary conquerors of the host country.
This is the reality which my movement has been contemplating, for the National Front does not fight immigration through some form of racism but, on the contrary, in order to avoid an irreversible situation similar to that in Lebanon, Bosnia or Kosovo occurring in France in the future.
Of course Israel must withdraw from Lebanon, but so must Syria, for whilst Israel occupies the south of the so-called security zone, Syria occupies the rest and, what is worse, has the Lebanese State held under some kind of protectorate where political skill combines with military presence and police terror. Jacques Chirac's most recent comments in Lebanon are regrettable, for they seem to be directed only against the Israeli presence.
How can it be accepted that the leader of the Lebanese forces in Beirut, Samir Geagea, has been held for more than four years - truly forgotten - in a Ministry of Defence basement, because he neither wanted to leave Lebanon nor accept a ministerial position within a puppet government following the veritable trials of Moscow! But is there not sometimes a sort of subtle and objective complicity between Hafez el-Assad's Syria and Israel to keep up a war on Lebanese soil, which both regimes perhaps have need of, in order to assure their domestic stability or to request ever more international military aid.
Jews hold the power, Muslims are in the majority. But the Christians of the Middle East remain in this state of dhimmi which the great Israeli historian Bat Yeor described in his remarkable work "Christians of the Middle East - between jihad and dhimmitude' . Lebanese Christians must restore their country's independence, they must be able to find once more the role that was theirs, regain their freedom within their own lands where, according to the expression of Béchir Gémayel, the bells must be able to ring unhindered in the country which guarantees not only their own people the right to government, but also offers other Christian communities of the Middle East assistance, solidarity, and even a safe haven.

Caudron
Madam President, Commissioner, ladies and gentlemen, everyone has the same feeling: this morning, as we discuss for the umpteenth time the situation in the Middle East, in the presence of four members of the Knesset whom I would like to welcome, this morning we are at a turning point, a time when anything could happen, for better or worse.
I have always been a friend of Israel. Like many, I was a friend nearly forty years ago when it was fashionable to be so in Europe and I remain so today, even if it is no longer the fashion. I was their friend when Israel was composed of only a handful of survivors determined to exist. I still am today now that Israel has become a great power. The layman that I am was a friend of Israel when it was establishing its kibbutzim, to the sound of joyous secularism. I remain so despite what I hear of sometimes violent debates which arise within the very heart of Israeli society.
I have been president of the Europe-Israel delegation for five years. Within this delegation, my colleagues and I have worked, and continue to work, for peace and friendship between Israel and Europe. We have worked in all subject areas: economic, social, cultural and research and technology. We have woven ties which we mend when they become frayed. We supported Yitzhak Rabin, we mourned him and, since the last elections, we have worked with the new team in power, which was the product of democratic elections.
Ladies and gentlemen, I mention all of this in order to be able to say clearly to you, in the name of my friendship, of our friendship with Israel, that we are very worried at the sight of the dangers and internal and external demons which are threatening Israel and the region. And if I remind you of all this, it is also in order to say clearly, on a personal level, that I largely approve of the joint resolution which is being proposed to us.
For once the text is short, clear and readable. The message is a strong one, without being aggressive. In certain respects, however, I would have wished greater detail. In my opinion, in Point 3 of the resolution there is insufficient emphasis on Syria's serious responsibility in the field of security, both towards and from Lebanon. We have also forgotten the countries of the region which finance fundamentalist terrorism, and we do not place sufficient emphasis on the fundamental role of our envoy, Mr Moratinos.
With regard to Point 9 of the Interim Agreement, first of all it has to be regretted that the contract of association properly speaking has yet to be ratified, and that this is down to France and Belgium. Above all it must be confirmed that although we can discuss the terms of implementation via the debate on the origin of products, this should not be a roundabout way of influencing the ongoing negotiations, even of sanctioning Israel.
In conclusion, I understand and approve of Israel's need for security and the Palestinians' desire for recognition. In order to reconcile the two, a just peace is required. This will be achieved through negotiations assuring the security and coexistence of Israel and the Palestinians. To mention this today is also a way for me to pay homage to Yitzhak Rabin, the soldier, the pioneer, the builder of Israel, subsequently the initiator of and the first Israeli signatory to the Oslo agreement with the Palestinians. To remember him is to continue his work.

Provan
Mr President, it is appropriate that we are debating this matter this morning in the presence of the Israeli delegation from the Knesset. It is probably rather galling for them to hear many of the speakers this morning calling for concessions from the Israeli Government.
But I rather agree with the President-in-Office when he called for courage and vision. That is the right approach that we require at the present time and not perhaps the other things that he could have mentioned: confrontation and confusion. We need to resolve the blockage that we have and the hardening of positions that seem to be adopted on both sides. The President-in-Office quite correctly said that it was necessary to understand that the presidency had taken initiatives in calling Mr Netanyahu and Mr Arafat together in London.
But that was necessary - if we are blunt about it - because of the ineptitude of the President-in-Office when he tried to visit Har Homa and created a very definite hardening of positions and opinions within Israel and within Palestine.
There is a reference in the resolution which I completely support which asks the Council presidency to urge Member States to refrain from individual initiatives and, instead, to work through appropriate European Union mechanisms.
Surely, colleagues - and I support completely what Mr Caccavale said - it is not helpful for individual ministers to try their own solutions in a situation like this. We need courage and vision. And I believe we need new initiatives from the European Union, along with the United States, to try to come to some decent solution with the Syrians, the Lebanese, the Israelis, and the Palestinians. Let us include also in that area the Egyptians, the Jordanians and, hopefully, even the Iranians and the Iraqis.

Barón Crespo
Mr President, Mr President-in-Office of the Council, Commissioner, ladies and gentlemen, this is a recurring theme which combines cultural, emotional and political elements of relevance to all Europeans. I want to underline here, as was pointed out by both the Council and the Commission, that our involvement in the Middle East peace process was a forerunner to the elaboration of a common foreign policy. From Venice to Oslo, passing through Madrid, there has been a rare unanimity within the Union, I would say, in spite of everything. At this moment, during the British Presidency, I should like to acknowledge the efforts of the Prime Minister, Mr Blair, and also the Foreign Secretary, Mr Cook, whom I do not think was treated properly on his visit to Jerusalem.
But the point at issue is not so much a matter of historical reflection or explaining the situation. The diagnosis has been dealt with at length today. The question is how we can help to break the current agonizing and dramatic deadlock in the peace process. And I think, besides suggesting brilliant or not so brilliant ideas, we have to see to what extent we in Parliament can make a positive contribution. There is one aspect which has not been mentioned here this morning, and I should like to do so, in the presence of the members of the delegation from the Knesset . It is that Israel has a greater moral responsibility, in that the fiftieth anniversary of the creation of the State of Israel has just been celebrated. Israel is a strong, vigorous democracy at the heart of the Middle East. That gives Israel a superior strength and responsibility.
I had the opportunity, in my capacity as President of the European Parliament, to explain our view to the Knesset at a much more promising moment - on the very day of the start of the Madrid process. I am also an old friend of both Jews and Arabs. In my youth I had the opportunity to work on a kibbutz . And I believe we must persevere with this dialogue, even with people who can maintain tougher positions. We have proof of that in the recent visit of the chairman of the Knesset , with whom we held a critical discussion. And we have to recognize that positive experiences in the field of peace, not just those of the late lamented Prime Minister Rabin, but also those of Prime Minister Begin, with the Camp David agreements, show that peace tends to be forged precisely between people who do not agree with each other.
I believe we must appeal to our Israeli friends and tell them that the Masada syndrome and creating a Bantustan are no solution to the problems of the Middle East. And I would add two further elements, apart from promoting that critical dialogue: support for the Commission proposal, and joint action with the United States, bearing in mind the key role which should be played by our envoy, Mr Moratinos.

Henderson
Mr President, I want to make one or two remarks in response to the debate we have had this morning. The debate has clearly shown that there is widespread concern about the situation in the Middle East and the failure in the recent past to make further progress. All of us feel terrible frustration every time we think there is about to be a breakthrough and then something happens which means that the situation does not move much further forward.
I very much agree with the point made by one of the contributors to our debate that what we need is not more proposals to try to tackle the difficult issues before us, it is implementation of some of the existing proposals based on the Oslo commitments. The Council's position is that we strongly support the Commission's initiatives to try to 'engineer' steps toward the negotiating table, where possible trying to use economic measures as well as political ones.
We strongly believe there is a need to follow on from London, where there was a hope that there would be progress, and to get down to dealing with the situation in the way offered by the American proposal. It has been clear in the debate that this view is supported on many sides of this House. That is the clear priority in the time ahead of us. We will also be asking our envoy, Mr Moratinos, to do what he can to try to persuade the various parties to take up the American offer to move the proposals further forward. That position is enshrined in the conclusions which were agreed at Cardiff yesterday; if they have not already been circulated they will be very shortly.

President
I have received seven motions for resolutions, pursuant to Rule 37 (2).
The debate is closed.
The vote will take place at 11.30 a.m.

Financial and technical cooperation with the Occupied Territories
President
The next item is the report (A4-0180/98) by Mr Tomlinson, on behalf of the Committee on Budgets, on the proposal for a Council Regulation amending Council Regulation (EC) No 1734/94 of 11 July 1994 on financial and technical cooperation with the Occupied Territories (COM(97)0552 - C4-0048/98-97/0316 (SYN)).

Tomlinson
Mr President, first of all I would like to welcome the President-in-Office's remarks on my report in the last debate. He identified very clearly my intentions and those of the Committee on Budgets, on whose behalf I present this report.
The peace process is important and needs proper resources. That is essentially what we are about. The Commission proposal for a Council Regulation amending the Council Regulation of 11 July 1994 must address two questions: the question of the legal base and the question of the duration of the regulation.
The present Council Regulation must therefore be amended. There we agree with the Commission but we believe that the current Commission proposal is too modest and is, in a number of respects, therefore inadequate. The existing problem is that there is no legal base for either the recurrent costs of the Palestinian authority or for the EIB activities. This is serious in any event but more so in the light of the Court of Justice ruling last week. The present proposal from the Commission, on which my report is based, overcomes this but only for the remainder of 1998. It leaves us with identical problems for next year and beyond. Parliament's amendments, as drafted and approved unanimously by the Committee on Budgets, seek to resolve this and do other things, at least for the years 1999 and 2000. Thus their whole intention is to help the Commission establish a longer-term strategy for what we are all agreed is an imperative - proper involvement and financing of the European Union contribution to the Middle East peace process.
The amendments of the Committee on Budgetary Control are clear. I will just go through them very briefly. Amendments 1, 3 and 4 are proposed to simplify the recitals and to include a mention of the duration of the regulation. Amendments 5 and 6 cite the Council decision, which expires in the year 2000 and in Amendment 5 gives justification to the subsequent Amendment 6. That latter amendment proposes a change in terminology to be used in this measure. We can all agree that the term 'Occupied Territories' is outdated, given the developments since 1994, and West Bank and Gaza Strip would appear a more appropriate phrase to use throughout the regulation. However, we also have to note that the financial and technical cooperation could be concentrated through the Palestinian Authority in the West Bank and Gaza Strip and so it might be that this more extensive phrase is appropriate. The Committee on Foreign Affairs, Security and Defence Policy has also considered this aspect. What is clear is that the words 'Occupied Territories' are now outdated.
Amendments 2, 7 and 8 incorporate fully in the text of the Tomlinson report the amendments that were proposed by the Committee on Foreign Affairs which clarify the objectives and modalities of the action, underlining its contribution to consolidation of the peace process.
Amendments 9 and 10 deal with areas where we perhaps understand that the Commission might have a marginally different view to Parliament because these concern the requisite level of information from the Commission to the budgetary authority and comitology; the detail is fully explained in the explanatory statement.
Amendment 11 and the draft amendment to the draft legislative proposal call on the Commission for a new, single, consolidated, legislative proposal for continuation of assistance to the peace process after 2000. They seek to do two things: clarify the confused legal base in the present proposal and give greater consistency and transparency in future.
I think that all those amendments are designed to assist the Commission in what it is seeking to do on behalf of the European Union in the Occupied Territories. I say 'I think' because regrettably communication with the Commission services, excluding the Commissioner, has been less than satisfactory during this process. In fact I would go so far as to say that they have behaved badly in relation to the European Parliament. When I was appointed rapporteur on behalf of Parliament, I asked to see the appropriate representative of the Commission. In response to my request he came to see me on 2 March and I raised specific questions. At the Committee on Budgets discussions on 17 March, 21 April and 30 April I re-emphasized all the questions that I had raised with the Commission representative and on which I had not received a reply. I had a very helpful and fruitful meeting with Commissioner Marín on other matters and I mentioned to his Cabinet on 5 May that I was still awaiting replies to questions I had asked on 2 March. Following that, various people got in touch with me: the first group to ask what the original questions were, despite the fact that they had been published in my draft report that went to the Committee on Budgets weeks earlier. Finally, I received a reply on 8 June, i.e. Monday of last week.
I raise this, not because I want to chastise anybody, but to show the difficulties that occur when Parliament is trying to help the Commission. For example, we wanted to know how the Commission had fulfilled its obligations to report to the budget authority and I quote these two sentences from a reply I received. 'I am aware that the Commission has not reported pursuant to the wording of Article 6(1)' says the Director-General, Mr Cioffi, and then he goes on not to apologize but to say: 'Due to political implications and the sensitivity of the matter, the Commission has considered the above as adequate.' Neither I nor any Member of this House considers that to be adequate. We have not had the fruitful dialogue that we would have liked and yet, despite that, we produced amendments which improve your proposal and help the Commission, Council and the whole European Union to do what we all want - to make a meaningful and constructive financial and political contribution to the resolution of the Middle East process. Therefore I commend all 12 amendments to the House.

Graziani
Mr President, it would be difficult not to agree with the Commission's proposals on granting financial assistance to the administration of the Palestinian Territories which we propose calling from now on the West Bank and Gaza.
It would be difficult, because in the given situation it is natural that a considerable chunk of the financial assistance goes into running the administrative machinery. That is all that is possible in this situation where the economic development of these territories is being hampered; not even the proposal for the port and the airport which should be the most basic and simple of matters have got off the ground. Obviously under these circumstances, we must, like in the case with the other proposal on subsidising interest on loans granted by the EIB, give a legal base to a de facto situation like the one we have seen until now, meaning we must grant financial assistance to the administration too.
Furthermore, the Commission is proposing a few changes to the regulation: that is, it is underlining the fact that financial and technical cooperation is fundamental to the development of the peace process and stressing the importance that civil society has for the democratic development of this area. Another fundamental point seems to us to be the request that the Commission make an annual report to Parliament on the effects of cooperation.
Having said this in very brief but rather specific terms, please allow me, Mr President, to add a few observations to the debate that we have had so far, stressing, in particular, how impossible it is for the European Union to do much more with the means that it has at its disposal. The European Union is unfortunately doing what it can, I would say what it knows how to do, that is, to provide financial assistance, because it would have difficulty doing more, being an economic rather than a political entity. I say this not to play down the importance of the efforts that the Commissioners and President-in-Office are making in this direction, but to underscore a political and an institutional fact, that of a European Union that does not have a political entity in a position to act. What is more, even the United States, as important as they may have been thus far in the Middle East, are capable of little more than fumbling around with a peace process that has become bogged down.
Please allow me therefore, Mr President, to conclude with a remark, with the agonising memory of the political intelligence and the capacities of a Prime Minister like Yitzhak Rabin in Israel.

Swoboda
Mr President, Mr Commissioner, ladies and gentlemen, it had already been said with great clarity and at some considerable length that the Commission's proposals are a step in the right direction and that the amendments on which Mr Tomlinson, in particular, has put in a very great deal of work, have improved and where appropriate modified them. Mr Tomlinson had made some criticisms, directed in part at those working for the Commission. I, however, in a sort of positive amendment of my own, would like to single out two representatives of the Commission and their colleagues for praise because they are doing excellent work. They are the European Commission's representatives in Tel Aviv and in Jerusalem.
On two visits I have noticed that a huge commitment is being made to represent Europe well. It is for this very reason that the Tomlinson Report is so important today, because it should provide the appropriate financial and other backing required to ensure that the European Commission really can use the money it is spending and its political and moral commitment to best effect. Both here and in other areas - as we have already discussed in another context - our representatives are hampered by the fact that many decisions are too cumbersome and too time consuming. Parliament itself is sometimes guilty, that I admit, but we must succeed in making our decision-making process quicker and less bureaucratic, particularly when it comes to financial aid.
A second point. You, Mr Commissioner, still hold the view - and I and my group support you fully - that we must not allow ourselves to be squeezed out of the peace process or our commitment. That is quite right. But perhaps we could see things in a more positive light. We are a part of the peace process and there is nothing anyone can do to change that! We are part of it by dint of our political, moral and financial commitment. Perhaps what we should be doing is improving the visibility of our efforts and activities. We are doing so much not only for the economic infrastructure, but also for democracy and human rights, that we really should also be increasing the visibility of what we are doing if we want to build bridges, to create the infrastructure. The Commission's representatives have made some appropriate suggestions in this respect.
If we spent just part of the money on demonstrating what we want to achieve with it, namely that we have a European obligation to peace, not only in the interests of our identity as a group, but also more generally for our public image and our image in Israel and Palestine, then our aid would be much more efficient. I would urge you, Commissioner, to continue with your policy, but to examine how we can better present the policy we are operating, particularly in critical phases, particularly in countries where the official propaganda perhaps presents our work in a somewhat more critical light than the population at large sees it.

Banotti
Mr President, the point I wish to make follows on from the point just made by Mr Swoboda.
On Easter Saturday 1997 I had the pleasure of visiting the European Hospital in Gaza on the very last day before the workmen finally left - a hospital that has been under construction since 1990. As a nurse I have to say I was extremely impressed by the hospital. In fact never have I seen a better-equipped hospital, in a country that desperately needs health care. I returned again this year on Good Friday, and that hospital has not received one single patient, has not received one single trainee, nurse or medical assistant. It lies there, a graphic symbol, perhaps, of our sterile role in the Middle East process.
Mr Swoboda has called for more obvious public perception of our role in the area. If this is the public perception I think it is outrageous. There is a situation I remember in Yes Minister , a British television programme which many us have often enjoyed, in which Sir Humphrey announces that although they have the hospital they cannot afford to have any patients. That, I am afraid, is exactly what is happening in Gaza. I am grateful to the Commissioner for his long answer to my question, dated 16 March, in which he tells me about the kind of money that has been spent on this hospital: over ECU 50 million, and not a single patient treated in the hospital.
The construction company that dealt with it is still waiting for quite a considerable amount of money, and since it is a small construction company from Northern Ireland, the long delay in payment is also causing problems there. Most important of all, are we to see nothing but white elephants as our contribution to the Middle East peace process? We have excellent ambassadors there but they simply do not have the structures to make the necessary impact on the political situation.
We are looking at practically the largest concentration of people in the world in the Gaza Strip, where they go for their medical treatment to dusty little clinics, many of which I visited when I was there, where heroic doctors do their best to cope under extremely difficult circumstances, while down the road this hospital is lying completely empty. The gates were locked. I believe it is costing about US$100, 000 a month just in security to maintain the hospital; but as I have said, not a single patient has been treated there and it is now fifteen months since the workers left. I know that we have sent out a tender for an international management team, but we are fiddling while Rome burns. The standard of health in the Gaza Strip is very low. The maternity care services are appalling. I have been to that hospital as well, and when I was there they had to remove a cat from one of the babies' cots when we were doing the tour in the outer part of that hospital.
Since we are discussing the budget and our contribution, we have to look into our souls, and I very much hope that the Commissioner will give us an adequate response to the concerns I am expressing about this issue. Many speakers this morning have spoken about their concerns in relation to the desperate situation in the Middle East. Friends of both Israel and the Palestinians return more and more depressed from that area, as I did myself after my visit there a couple of months ago. We unfortunately count for virtually nothing there, because we have not put the structures in place in that part of the world to maximize our contribution to the area.

Nordmann
Mr President, I would like to speak in support of both Mr Tomlinson's report and the principle of European Union aid to the peace process, whilst formulating a few critical reflections on the way this aid is received and, I would say, perceived.
What is its purpose? It is a question of contributing to the development of peaceful co-existence between Jews and Arabs in the Middle East. Owing to circumstances, this aid is increasingly concentrated on the development of support structures for the Palestinian Authority which, unfortunately, is interpreted as a sort of anticipation of the peace process and consequent recognition of a still doubtful State whose borders remain, at the very least, to be defined. The result is that this political anticipation which underlies the aid is perceived, especially in Israel, as unilateral encouragement of one side rather than both. It is all the more worrying since, although there exists in Israel a group in favour of peace and co-existence, one wonders if a similar group for peace and Jewish-Arab co-existence also exists on the Palestinian side.
The model for reconciliation which Europe has represented and must continue to represent for the Middle East is an excellent thing. Franco-German reconciliation worked because there were people in favour of peace on both sides, in both countries. It would be desirable for European Union aid to place greater emphasis on the establishment of parties for peace on both sides of the dividing line.

Antony
Mr President, ladies and gentlemen, we have listened to Mr Tomlinson's comments with a great deal of interest and on the whole we support his report. Indeed, I think it is a good idea to stop talking about the Occupied Territories. But why replace this expression with the West Bank and Gaza Strip? No, I think the role of the European Parliament is precisely to go further than this; to anticipate peace and use the word "Palestine' . I think this would move things on. We must talk of European Union aid to Palestine. Palestine must be built and I think that we should not lose faith in the Palestinians. There are a great number of Palestinians in favour of peace, just as there were a great number of people in favour of peace in the homelands during apartheid in South Africa. But it is not by maintaining these homelands, by maintaining this apartheid, that peace will be built.
We have to contribute financially to the construction of Palestine, but we also have to contribute to it politically. I think this is precisely one of the points on which the countries of the European Union are agreed. They are all agreed on making things move in the direction of recognition of the fundamental rights of a people. The United States are currently monopolizing all of the so-called "Western' influence, with a partiality which is constantly in favour of the State of Israel. This partiality must no longer be accepted. We have to come to a more balanced vision of things. This is how peace will be built.

Cellai
Mr President, Council Regulation EC 1734/94 lays down the terms of financial and technical cooperation between the European Union and the Occupied Territories with a view to promoting the process of development in these areas and creating conditions favourable to a positive outcome of the peace process, which unfortunately is not the case right now.
We are convinced, as the National Alliance delegation, that financial and technical cooperation between the Gaza Strip and the West Bank makes a fundamental contribution to the consolidation of the peace process. However, we must admit that the impact of the Union's financial assistance in this area has so far not come up to expectations, despite the tremendous efforts made. The causes are many: the difficult progression of the peace process that has not created the conditions of stability necessary for development; the blocking of the Occupied Territories on and off by the Israeli authorities in retaliation for terrorist acts; and a certain incapacity to manage on the part of the Palestinian Authority combined with the suspicion of illegal practices.
Amendments to the proposal for a regulation would therefore be helpful in order to better clarify the objectives and the terms of action, stressing the need to consolidate the peace process and coming up with a more detailed definition of the legal basis of this financial cooperation. The fundamental role of financial and technical cooperation in developing the peace process and consequently in developing a civil society must be reaffirmed, the democratic development of these territories being hindered if a civil society fails to be created.
I have one final remark, and that is that we consider it appropriate that the Commission send Parliament a written report each year on the effects of cooperation.

Marín
Mr President, first of all I should like to thank the Committee on Budgets, especially the rapporteur, Mr Tomlinson, for their excellent, meticulous work, and the Committee on Foreign Affairs, Security and Defence Policy for their valuable opinion.
The importance which Members attach to the future of the Palestinians and the peace process gives me confidence that the European Union will manage to adopt a common approach to tackle the region's problems.
To be able to undertake positive work in the future, and for the sake of the credibility of the Union, it is essential for us really to share a common strategy, and I should like briefly to remind you of the context of this Commission proposal.
As you are well aware, the current regulation on assistance to the Palestinians was adopted on the basis of the declaration of principles signed by Israel and the Palestinians in September 1993, and was followed by the international donors' conference in Washington.
Unfortunately, the deterioration in the political climate in the Middle East and the successive crises in the peace process have seriously affected our aid programme. In particular, the difficult political situation has caused serious budgetary problems both for the Palestinian Authority and for other Palestinian public institutions.
So the international donors - including the European Union, which is the most important - have been obliged to devote a large part of the project funds to recurrent costs and budget support.
Again and again, and each time at the request of the Council, the Commission has had to adapt to these circumstances in order simply to guarantee the survival of the Palestinian Authority and the peace process itself. We have never denied that during our appearances before this Parliament.
It is true that the Community cannot help, or does not usually help, to fund the recurrent costs of this sort of institution. That is why the 1994 regulation - the first one presented by the Commission - did not envisage this type of budgetary support. And in that sense, I can tell you that at the time the regulation for the special Palestinian programme was established not even I, who witnessed the meetings in Washington and Cairo, could have foreseen that with time the peace process would come to experience the difficulties it has suffered, or that it would be necessary, especially at the time of the first border blockades, to begin to pay a series of administrative or recurrent costs which, I repeat, were not included in the programme.
So the aim of the proposal under discussion today is, if you like, to enable recurrent costs to be financed from Community funds. And there is no hiding the fact that it is also due to the Court of Auditors having decided, quite rightly, that certain financial payments made to the Palestinian Authority during the peace process do not have an adequate legal base, and furthermore are being used for other objectives of an administrative or recurrent nature which are not covered by the regulation.
That is absolutely true and cannot be denied but, I repeat, we have had to do it because of the political circumstances.
As for the proposal to allow interest rate subsidies on lending by the European Investment Bank, that is also aimed at allowing this institution to fulfil its political mandate.
So these two amendments constitute the main changes the Commission has made to the regulation in question. In that respect, I am pleased to note that we are in agreement with the amendments which, I repeat, form the essence of this proposal.
Nevertheless, I have something important to say to Parliament, the Committee on Budgets and the Committee on Foreign Affairs, Security and Defence Policy. The Commission finds itself in a paradoxical situation at the moment. The Commission fully shares the objectives set out in the amendments tabled by Mr Tomlinson and the Committee on Foreign Affairs, Security and Defence Policy, which refer to the future of assistance to the Palestinians. However, we have a problem with the timing. The Commission will have no problem accepting these amendments, their essence and their stance at a later date. I say that because the Commission is about to present a new regulation, in accordance with the instructions given by the Council of Ministers in February. We have to present it before the end of the British Presidency, probably at the Council of 29 June. That new regulation comprehensively addresses all the aspects relating to the overall analysis of the future of the Union, in terms of political and economic conditions.
So I hope you will understand this paradoxical position. We would simply ask both Mr Tomlinson and the Committee on Foreign Affairs, Security and Defence Policy that a decision on these amendments should be deferred until after the Commission has presented the new regulation to the Council of Ministers.
Once it has been presented there will be a common legal base: Article 130w. There will be a whole set of political conditions, an exercise in globalization and a vision of the future with respect to this regulation.
So, I repeat, I hope you can understand this paradox. I would point out once again that we will have no difficulty accepting Parliament's suggestions and the suggestions contained in the amendments. Moreover, we also openly recognize, without any problem, that it is an excellent idea to present a two year deferment in order to conclude the financial perspectives and to extend them by a further five years. We think it is an excellent idea to have an overall view. But as things stand, the Commission has a problem of an institutional nature. We have to present a regulation to the Council of Ministers, because that was decided by the Council of Ministers in February.
Secondly, we have another problem I hope you will understand. We are also interested in Mr Tomlinson's amendments insofar as they represent a clever way of getting away from that heavy cross we have to bear, known as comitology. But again, I have to say that following the European Council in Cardiff, the Commission is going to present a communication to try to change the comitology involved not just in the Palestine regulation, but in the whole system as it currently exists, derived from the Maastricht Treaty. So the Commission thinks it is very important to adopt a comprehensive approach to all the legal bases in the budget. That is why the Commission has taken the initiative of presenting a plan for overall reform. And the plan under consideration today is a good example to demonstrate that the current comitology is a heavy burden, which helps neither Parliament, the Council of Ministers nor the Commission.
I should now like to address the problems raised by Mr Swoboda, for example, on the European Union's participation in the international donors' agreement. You know that we are making an effort to ensure that the European Union plays an essential role in the donors' conference. That point is also going to be included in the new regulation, and is a question which Parliament and the Council of Ministers will have to resolve. That is why we want to base this regulation on Article 130W, so it can have a global vision, and that is why we would ask you to delay all these questions just until October. Then, in October, when we have the general debate on this new regulation - I hope Parliament and the Council will approve it, because for me that point is essential, Mr Tomlinson - then, with Mr Tomlinson's amendments and the Commission's new regulation, a very simple conundrum will have to be solved. Will the Council accept your amendments? Will the Council accept my regulation? That is the political problem, because I am asking for a lot of money, and Mr Tomlinson is asking for a lot of money. So I would ask that we have that global vision in October, because we are asking for ECU 1.6 billion. And after what happened in Cardiff, the European Parliament and the Commission have no choice but to implement, with your amendments or my new regulation, what the Council is going to say. So we are in favour of waiting until October, once the Council gives us the margin for political manoeuvre. That is what we think.
I shall now turn to a few other questions. Mrs Banotti, the European Commission has made an enormous effort with the hospital in Gaza. The thing is, you have to render unto Caesar what belongs to Caesar, and render unto the Commission what belongs to the Commission. In other words, we are working with UNRRA and so all I can do is tell you how much we have paid, how much work we have done, what we want to do in the hospital, and the difficulties that exist in knowing whether or not sick people and refugees can be treated. But is it the Commission's fault if the Gaza hospital is not open? Go and visit the airport. It has been completed. The control tower is there, and all the electronic equipment. I have spent ECU 15 million on it. I knew it was useless. Is it my fault that the airport is not open? You place me in an impossible situation. Of course the airport is closed, and of course I have paid many millions of ecus. But is it my fault that the Israeli authorities do not want to authorize it to open? Please direct your criticism at the people responsible. You tell me: "Spend the money' . I spend the money. Then it unfortunately turns out that the airport, port, hospital, television station, radio or whatever cannot open. Then you ask me to explain politically to you why it cannot be done. Please understand that I am in an impossible situation. I am not the one who gives permission. That permission is granted by the Israeli authorities.
In short, I am really sorry. No doubt my credibility is non-existent but, believe me, the Commission and this Commissioner have spent a year and a half suffering real agonies over this situation, for which we do not feel responsible because, obviously, what the Commission cannot do when faced with this sort of difficulty is decide to stop paying, because that would be a bureaucratic solution.
If there is no legal base and I do not pay, you would accuse me of being a bureaucrat. If there is no legal base, but the Council makes political decisions and I pay, you would say: "You are irresponsible because you pay when there is no legal base' . Thirdly, when work has been done - the hospital, the airport and so on - the Israeli authorities say: "That is not going to open' . There are questions in Parliament and you ask: "But why did you spend the money on that?'
Please, show a little solidarity with the Commission. You have to back us up, otherwise in the end nobody is going to want to be responsible for the situation.
In short, Mr President, this is a very complicated situation. Mr Henderson knows that because he is on the Council. Mr Tomlinson knows it, so does Mr Swoboda, and so does Mrs Banotti because she has been there. I would like nothing better than for the hospital to be working. But how can we convince the Prime Minister, Mr Netanyahu, that it should also take refugees? Tell me how to do that.
Mr President, my conclusion is this. The Commission does not deny the intelligence and the value of Mr Tomlinson's amendments, which are quite right, or Parliament's contribution. In February the Council asked the Commission to produce a new regulation to combine all the separate decisions which have been made during the last three years. Some of them have no legal base.
The Commission's position is that it will present the regulation to the Council on 29 June. I hope the Council will give us the political and financial margin, and once we have that I shall have no difficulty accepting Mr Tomlinson's amendments, when they are presented in the European Parliament in October, under the Austrian Presidency.
But at the moment I cannot do so, for legal and institutional reasons, and I beg you, please be as understanding as you can of the Commission's position.

Welcome
President
It is my great pleasure, on behalf of the House, to welcome a delegation from the Israeli Knesset, who are seated in the official gallery, headed by Mr Zeev Boïm, member of the Knesset. They are here for the 23rd interparliamentary meeting with the relevant delegation from this Parliament.
It is my hope that this 23rd meeting, which is taking place at a difficult moment in the peace process, will mark a further stage in the necessary rapprochement between the countries and peoples we represent, with a view to peaceful and fruitful cohabitation around the Mediterranean which, as in former times, is a privileged and incontestable point of contact.
May I wish the Israeli delegation fruitful meetings and a very pleasant stay in Strasbourg.
I would also like to welcome the representative of the Palestinian Authority to the European Union, and a delegation of ambassadors from the Arab States.
(Applause)
Financial and technical cooperation with the Occupied Territories (continuation)
Tomlinson
Mr President, I welcome the remarks of Commissioner Marín. It is very helpful that he has been quite so fulsome towards Parliament's views and quite so welcoming of them. But he said in his remarks that we had to understand the paradoxical problem of Mr Marín. Well I do. But I hope he understands the paradox that he is posing for Parliament. What Mr Marín seemed to say was that he agreed with the amendments of the Committee on Budgets. What he went on to say was that he shares the goals of Mr Tomlinson's report. He went on to say 'we have no problem with them' - no problem in accepting these amendments or the thrust of them. And then those fateful four words, 'at a later date' .
This seems like a kid who is waiting for Christmas. He has been through all the preparation and suddenly somebody comes along and hijacks Father Christmas's bag of toys and says 'but you can have them next year' . Parliament is not in a great mood for procrastination. So there is a paradoxical problem of Marín, but there is a paradox that you present for Tomlinson. Perhaps, some time, we should sit down and share paradoxical experiences.
I merely give you notice, Commissioner Marín, that I really welcome the spirit of what you have said. I will cut the words out of the Rainbow and make sure we keep them as a reference point for the future. But equally, when we come to the vote on this report later, I will ask you quite explicitly at the end of the votes on the amendments, whether you can accept them. Then we will take our decisions based on what you say then.
At the moment I thank you for your comments but, quite clearly, you will have to understand that Parliament also has its own position to take into account as well as being understanding of the positions of other institutions.

Marín
Mr Tomlinson, I would like to explain the Commission's position now, so that Members are aware of it straight away, without me having to comment at the time of the vote.
As I said, the Commission will have no problem in accepting the spirit and the content of your amendments once we have presented the regulation to the Council of Ministers. At the moment we cannot do so. We are simply asking Parliament to be flexible and wait another three or four months. Since August is taken up with holidays, I do not think it is asking much to wait until September or October to hold a general debate under the Austrian Presidency, because we have a lot of problems and we would prefer to have a general debate in October.
That is our opinion.

President
Thank you, Commissioner.
This exchange thus brings our debate to a close.
The vote will take place at 11.30 a.m.
(The sitting was suspended at 11.25 a.m. and resumed at 11.30 a.m.)

Votes
Thomas
Mr President, Amendment No 41 is different to Amendments Nos 42 and 43. Amendment No 41, with the date 2002, was not supported in committee. The date 2005 was supported, thereby giving the producers a longer period to settle into a new regime. The period we should support is 2005, not 2002.

President
Mr Thomas, I have made a note of your comment and I will see to it that a check is carried out by the Parliamentary language service to ensure that the rendering is correct, as you request.

President
Do you want a separate vote on Amendment No 41?

Thomas
Yes, Mr President, I want a separate vote for Amendment No 41 as it is different.

Provan
I wish to ask the rapporteur, just for clarification, whether it would not be easier, in the circumstances, to withdraw the amendment and leave the original Commission text.

Thomas
I am quite happy to do that.

President
But it is an amendment by the Committee on Agriculture and Rural Development.

Thomas
Yes, there has been a mistake. I have checked with the services. The committee voted to support 2005 and not 2002. Therefore, if the chairman of the Committee on Agriculture and Rural Development is agreeable, this amendment should be withdrawn.

Aldo
Mr President, there is indeed a problem. I would simply remind the rapporteur that, in the recitals, the Committee on Agriculture and Rural Development adopted 2005. But Amendment No 41 was also voted for by the Committee on Agriculture. On the one hand, in the recital, 2005 was agreed on, whilst in the body of the text, it was considered to be 2002. I therefore think that there is no reason now to remove the amendment relating to 2002. This must go to a vote.
(Parliament adopted the legislative resolution)

President
We shall now proceed to the election of a Parliamentary Vice-President.
We have received nominations for Mrs Bloch von Blottnitz and Mr Gerard Collins.
Four scrutineers will be appointed for the election.
(Mr Mohamed Ali, Mr Parodi, Mrs Marinucci and Mr Frischenschlager are chosen by lots as scrutineers)

Martens
Mr President, I would like to clarify our position on this vote. Our group has always supported the correct application of what we consider a fundamental rule for this Parliament, namely the proportional distribution of members of the Bureau, President, Vice-Presidents and Quaestors.
During the present legislature there was an agreement between the most important groups, the Group of European Socialists and ours. This worked well at the beginning, but during the second vote this did not work well as far as the election of Quaestors was concerned. We see the above rule as a fundamental rule for our Parliament. The position of our Parliament remains extremely fragile. Only this morning we were talking about the attacks which are launched almost daily against our Parliament. We therefore think we should maintain this rule. According to the calculations of the d'Hondt system, the Union for Europe Group is obviously entitled to a Vice-Presidency. Since Mr Podestà joined our group, we have the number of VicePresidents that we need. That is why we withdrew the candidature of Mr Cunha, out of deep respect for what we consider to be a fundamental rule of this Parliament.
I should like to pay tribute to Mr Cunha for agreeing to the withdrawal of his candidature. I understand that the major groups in this Parliament are prepared to respect this rule, the d'Hondt system. We were assured that this was the case, and under these circumstances we have therefore withdrawn the candidature of Mr Cunha. It was our intention that the Union for Europe Group, which is entitled to the seat of Vice-President, would obtain it, despite the fact that we were disadvantaged during the previous vote where the Quaestors were concerned.

Cunha
Mr President, just a word to underline what Mr Martens has said. For myself, speaking personally, I had no hesitation in withdrawing my candidature, because I consider that we should follow the rules which have always governed the work of Parliament, that is to say the d'Hondt method.

Roth
Mr President, I would like to point out that it is, of course, the right of any Member to present his candidacy for the post of Vice President. It is also the democratic right of the Groups in this House to propose Vice-Presidents. Mr Martens has already pointed out that although internal agreements do exist - between the large groups, as you said, but, of course, there are other groups in the House, too - there are also agreements which are not necessarily supported by this House as the election of Mr Killilea as Quaestor has already shown.
Here the House, in its great wisdom, has made a decision which is different to that which the "arrangement' might have dictated. For this reason it is our democratic right to present to the House a candidate from the Green Group in the European Parliament, in the belief, incidentally, that it is entirely appropriate to consider whether, in a committee such as the Bureau of the European Parliament, it would not be right, proper and democratic if all groups were to be represented, rather than having the present situation in which three groups have no representation at all. Three groups in this House are entirely unrepresented in the Bureau, as are the independents.
For this reason, this candidacy is a candidacy which will bring a little more democracy into this House at a time when the Bureau is holding very important debates.
(Applause)
President
544 Members voted.
On behalf of Mrs Bloch von Blottnitz: 141
On behalf of Gerard Collins: 332
Abstentions: 71
Gerard Collins has accordingly been elected Vice-President. I congratulate him and thank the scrutineers.
(The sitting was suspended at 12.10 p.m. and resumed at 12.30 p.m.) Report (A4-0223/98) by Mr Valdivielso de Cué, on behalf of the Committee on External Economic Relations, on the proposal for a Council Regulation amending Regulation (EC) No 3295/94 laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods (COM(1998)0025 - C4-0159/98-98/0018(CNS))Quist
(Parliament adopted the draft legislative resolution)
Welcome
President
I would like to inform the House of the presence among us, in the officials' gallery, of the President of the Greek New Democracy Party and leader of the official opposition in Greece, Kostas Karamanlis. Mr Karamanlis has been visiting the European Parliament since yesterday for talks with the President of the Parliament and the chairmen of the political groups. We hope he will have a pleasant stay in Strasbourg.

Votes (continuation)
van Velzen, W.G.
Mr President, due to the uncertainties which have appeared in my own group as a result of the vote change, I am trying to make it clear to them that we are going to vote on recital B first, and that after that we will return to recital A.

President
Mr van Velzen, we will clarify it with an electronic check so that there is no confusion.

Green
We have already voted on A and it has been adopted. You really cannot go back and check it now that the following vote has been taken. That is absolutely unacceptable.

President
Mrs Green, you are right in the following sense: indeed we did vote on A and indeed the majority was for. An electronic check was requested and there was confusion between A and B and so I repeated both votes. I can repeat the electronic check.

Green
Mr President, you had declared that vote and moved on to B. You then took the recorded vote on B. It is absolutely unacceptable.

President
That is absolutely true, Mrs Green, but I have been asked to make a check on A.

Green
Mr President, it is against every rule on voting that I have ever heard of to accept a check on a vote that has been declared, after you have taken the next vote. It is completely unacceptable practice.
They made a mistake with their votes. It is unacceptable to recall it.

Oomen-Ruijten
Mr President, as usual you acted very quickly. Immediately after recital A we requested a check on the vote, and at that point you moved on to recital B. I believe that this vote is perfectly legitimate; we have now voted on A.

Quisthoudt-Rowohl
Mr President, even if the other side of the House does have a relative majority for Recital A, in this case a qualified majority is required. If a large group is against it, we simply need to check whether the others obtain 314 votes. That is, after all, what we want to know.

Green
Mr President, I can accept that if one of the majority groups in this House is against something on a qualified majority, then it will be lost. But you declared the vote adopted and moved on. It is unacceptable for them to realize they made a mistake and to ask you to go back. We cannot accept that. Once you begin to do that, anarchy will reign in this House.

Provan
Mr President, I can well understand the anxiety which some people have on this issue, and I quite understand Mrs Green's position. But let there be no doubt that there were clear calls for a check on Recital A immediately the vote was taken. Unfortunately, we moved on rather quickly to take the vote on B, when there were still calls for a check. Looking around the House, I believe the calls were absolutely justified, and I call on you, Mr President, to make a check on Recital A as you are duty-bound to do. We can then re-vote on Recital B in due course.

President
We will make an electronic check on Recital B, as requested.

Rack
Mr President, with respect for your management of proceedings, Mr Provan has described quite clearly exactly what happened during the vote on Recital A. You called for the vote on Recital A, and the first calls of "check' were heard immediately afterwards. However, you proceeded to Recital B immediately. You then decided, quite rightly in my view, to allow another vote on Recital A by way of a check. As I see it, you then allowed yourself to be dissuaded from holding this vote by the argument put forward very vociferously by the other side of the House. That cannot be right. As a result, I did not take part in the subsequent vote and would now request that this matter be cleared up once and for all.

President
Mr Rack, it is laid out very clearly in the Rules of Procedure. I have the French text:
' After the result of the vote by show of hands has been declared, verification may be requested through the electronic voting system' .
I moved on, I took the vote on the first, announced the result and at that time I was not asked to make a check. I moved on to B and at that moment Mr Ferber and other Members called out to me that there was some confusion and requested an electronic check. I made the check on B. I was then asked to make a check on A. If there had been no objection I would also have made one on A, even though it had been requested rather late on. Since there was an objection I could not do it.
(Parliament adopted the resolution) We will now examine the annex to the draft resolution.
After the vote on the resolution
van Velzen, W.G.
Most certainly, Mr President, you should have a look at the text. We just voted on paragraph 1© under your chairmanship. In paragraph 1© the second point which was voted on, there is the phrase: "takes account in this connection of the attached text' . This text has been rejected. It is therefore completely absurd to start voting on an annex which we have removed from the legislative resolution. We have therefore completed the vote.

President
Mr van Velzen, the President's officials have explained to me that we are not obliged to put a reference to the vote which says: " Taking into consideration the text which is attached in Annex...' . It is taken as read that the text in the Annex is also taken into consideration. It is superfluous and that is why it was not put to a vote.

Linkohr
Mr President, as the rapporteur may I perhaps say a few words about this important vote? We have obviously now removed the phrase which requires the Commission to take into consideration the attached text. But at the same time we also voted to take a decision on the basis of Article 38 b of the Treaty and Rule 50 of the Rules of Procedure - and these make a direct reference to a Parliament initiative and not to any statement.
If you do not agree to this now, then you yourself will effectively be making your previous decisions, that is Article 38 b and Rule 50, look ridiculous. What the Commission will make of that is its business, whether or not we agree to this. The Commission, too, can read, in all 11 languages! I insist that a vote be taken on this annex now in accordance with procedure.

Herman
Mr President, to save the Chamber's time and in order to take the rapporteur, Mr Linkohr's, wishes into account, I propose a single vote on the annex and we will thus know immediately where we are, for this annex also requires a qualified majority.

President
Mr Herman, there are votes in sections. How is it therefore possible for me to take a general vote on the whole Annex?

Robles Piquer
Mr President, if you will allow me, I will try to inject a bit of common sense into this debate. And I do so because of my interest in renewable energies, which is well known to Mr Linkohr and others in this House.
The reason my group wants to reject Recital A is very simple. By mistake, Recital A says there is "no Community legislation on feeding in electricity from renewable sources of energy' . I say that is a mistake because the directive on the electricity market published in January 1997 - on which, as I said in the debate yesterday, this Parliament did a great deal of work, mostly thanks to Mr Desama - contains two references to renewable energy, in a recital and an article.
So it would have been acceptable to say there was inadequate or little legislation, but not that there is none. As Mr Linkohr said earlier, that is why we cannot accept that text.
What is going to happen now, Mr President, is very simple. The majority of our group is going to vote against, and that means there will not be a qualified majority, and the whole document will not be approved. It would be better for the Committee on Research, Technological Development and Energy to study it again, because we believe it is possible to improve the text and, at a later date, submit to the House a text which everybody could approve.
That is what I suggest.

President
Mr Robles Piquer, if I have understood correctly, you are requesting referral back to the Committee on Research, Technological Development and Energy. Fair enough, you can request it. Are there any objections?

Linkohr
Mr President, we had sufficient time to deal with this in the Committee on Research, Technological Development and Energy. The other side of the House also tabled amendments, which were adopted almost without exception. Until a moment ago I also had the impression that there was broad agreement on this report, as, incidentally, we have always had broad agreement on renewables in the past. I cannot understand why the Group of the European People's Party has suddenly had a change of opinion, but everyone has a right to do so. Anyone can make a mistake, but I do not believe that we will make any progress if we go back to committee now. We have been in this situation before and we are not learning from our mistakes. Please, let us vote on it now. Then we will know where we stand.

President
Mr Linkohr, you are opposed. As a result, we have heard one for and one against.

van Velzen, W.G.
Mr President, I would like to argue in favour particularly because we, in the Committee on Research, Technological Development and Energy, have been trying for a long time to change the aid models found in Mr Linkohr's report, which are extremely dirigiste. We did not succeed, and I therefore think it would be useful to refer it back for further consideration.

Bloch von Blottnitz
Mr President, first of all, two Members have spoken in favour of this report, so at least two might be allowed to speak against it. Incidentally, I should like to point out that have we never started referring things back to committee in the middle of a vote before. Strictly speaking, this amendment should have been tabled in advance. I should also like to point out that we discussed this matter long and hard in the Committee on Research, Technical Development and Energy, and that we have always said quite openly - on this side of the House at least - that we need to find a route towards renewable energies, and this lays the foundations for it. If you want to destroy those foundations, all well and good, but that is not what you have been saying until now. I will not go as far as to say that you have been lying, but this sort of thing cannot be allowed to go on. As soon as you realize you are losing, you want to send the whole thing back to the committee stage. If that is to be the case, then our work here in the future will be like that of a nursery school and we will never make any progress. Mr President, please let the vote continue in order, as it usually would.

President
The proposal for referral back to committee will now be put to the vote.
(Parliament rejected the proposal)

Collins, Kenneth
Mr President, I rise to draw the attention of the House and yourself to the fact that an interview has been taking place in the public gallery. I am not at all sure that conducting television interviews while a vote is taking place is a proper use of the public gallery. Could you please take action to prevent this happening?

President
Mr Collins, instructions have been given.

Lataillade
Mr President, could I support Mr Herman's proposal? It appears that voting is always carried out in the same way and that every time it is impossible to gain a majority. Mr Herman's proposal for a general vote seems perfectly reasonable and we would have avoided spending a great deal of time only to arrive at the same result.

President
I would like to ask the House to bear in mind that the political groups that have tabled amendments must withdraw their amendments in order to allow this general vote to take place. I personally have no objection, and if the political groups are in agreement and we can take a general vote, then let us do so.

McNally
Mr President, we do not agree with that. There are amendments where we have asked for roll-call votes. We want the stance of the party opposite to be made public in those roll-call votes and we want them voted on one by one.
(Applause from the left) - After the vote
Linkohr
Mr President, we are, nevertheless, still faced with the problem that we are referring back to committee an annex which we have now rejected. What we are supposed to do in this situation, I do not know. But I leave it to your wisdom to decide whether you want to take the vote again or not. It would certainly be a unique event in the history of Parliament.

Fabre-Aubrespy
Mr President, in addition to an error in the voting list, I fear you may have committed an error in the voting procedure. The final vote can clearly not take place before the annex has been voted on. You first of all put to the vote, at the request of one group, the second part of paragraph 1 c) separately, which required the annex to be considered. You then proceeded to the final vote, then to the vote on the annex. And even before proceeding to the vote on the annex, but after the final vote had taken place, you agreed to put to the vote a procedural motion requesting referral back to committee, when in accordance with Article 129 it is clear that referral to committee cannot be requested after the final vote.
I think that, in reality, the final vote to which you proceeded earlier was not handled correctly. We cannot proceed to a final vote before having completed the voting on the text, that is, the text and its annex. I therefore think that you must put the text to a final vote, one which could not take place earlier.

President
I am sorry, Mr Fabre-Aubrespy, but I do not agree with your interpretation. The first part of the vote was clearly separate from the vote on the annex. This has already given rise to some discussion and has been clarified. We could have two votes, as has been done, one on the motion for a resolution, the other a separate one, on the annex. We have completed the first, and nothing further needs to be done now with regard to the annex. I am not going to put the annex to a final vote. That is an end to the matter. Before suspending voting time, I will announce the explanations of vote and I wish you all a good lunch.

Ahlqvist, Andersson, Hulthén, Lööw, Theorin, Waidelich and Wibe
It is our view that there is no need for a quota system for bananas, especially not with regard to imports from third countries. This system is unnecessary.
We want a free market for the banana trade. In other respects we are, of course, very positive towards helping ACP countries in various ways to get the chance to develop trade in their own products on the world market.

Kirsten Jensen, Blak and Iversen
The Danish Social Democrats have today voted in favour of an amendment on common organization of the market in bananas. A change in market organization is necessary because the EU has lost a WTO case. The Commission's proposal is a reasonable attempt to strike a balance between the various considerations. We must respect our WTO and Lomé obligations, while also assuring consumers of good, inexpensive bananas.
Many of the amendments by the European Parliament upset this balance. Thus, we have voted against a reduction in the dollar banana quota because it is at odds with WTO provisions. We have voted against an increase in duties, because that would make bananas too expensive. We have also voted against raising duties on non-traditional bananas because it would be obscene to add to duty on bananas from some of the poorest countries in the world.
We have voted in favour of the report because it contains a proposal for a fair trade banana system. Supporting a changeover to production of fair trade bananas is an excellent way of helping smaller producers to become competitive in the face of dollar bananas.
The report paves the way for two different systems - one for fair trade bananas and one for organic bananas. However, there should only be the one system, meeting both environmental and social requirements. It is unrealistic to imagine that ACP producers will be able to do without pesticides altogether. Thus, a definition of fair trade must be worked out between producers and consumers. The system must include support for a changeover in production, support for consumer information and a system of labelling and monitoring so that consumers can be sure of what they are getting for their money.

Krarup, Bonde and Sandbæk
It emerged once again last week that the American banana company Chiquita is deliberately flouting employee rights and environmental considerations in its banana plantations in Latin America. For many countries, ACP or otherwise, banana production is a crucial source of foreign currency, and a large number of people are financially dependent upon these exports. But as the Chiquita affair reveals, banana production also puts third world plantation workers seriously at risk, both socially and in terms of health.
We have supported those amendments proposed by the committee and other members of the European Parliament that require the common organization of the market to take account of and actively promote the production and import of so-called fair trade bananas. We would have preferred to see a special fair trade quota being set up, but that would fly in the face of current WTO regulations. When the next round of WTO negotiations begins, the EU must have the clear objective of bringing about such a quota. Until then, we must ensure that fair trade organizations have easy import access.
We have abstained from voting on the actual report on the common organization of the market because the proposal indiscriminately gives traditional ACP countries an advantage. There are countries outside this circle equally dependent upon banana production, and we have no guarantee that plantation workers in ACP countries are treated any better than their colleagues in Latin America. Moreover, the present proposal does nothing to safeguard small-scale banana producers. The World Bank has calculated that only about 12 % of the additional price European consumers pay for bananas actually goes to the producers - the remainder goes to the importers, and with the existing proposal, there is no guarantee that the future will be any different.

Lindqvist
Banana imports to the EU are surrounded by a mass of regulations, duties, quotas and penalty duties. The EU itself must set a good example and reduce the amount of regulation, follow the WTO ruling and increase the focus on free trade.

Miranda
This proposal, which follows a decision of the World Trade Organization, is particularly symbolic and important and, if approved in the form submitted by the Commission, will seriously change the present situation for the worse as regards the common organization of the market in bananas.
Symbolic because the Commission's proposals would entail an intolerable acceptance of the universal predominance of the WTO - and the interests of the USA - with the inevitable sacrifice of the traditional privileged relations between the EU and the ACP countries, for bananas now, and extended to other areas later.
Serious changes for the worse, because by substantially increasing the quota of imports from third countries (another 353 million tonnes) - particularly for the benefit of the 'banana-dollar zone' - it would affect levels of imports from the ACP countries and also the amount of room on the market for Community products, especially those from Madeira.
We therefore consider the amendments by the Committee on Agriculture to be helpful. They are in fact designed to ensure that Community producers' interests are safeguarded and to maintain the essential aspects of our preferential agreements with the ACP countries. This is what is happening with the reduction of the extraordinary quota to 100 thousand tonnes. And it is also happening with the fixing of a quota of 57, 500 tonnes for Portugal, 7, 500 tonnes more than at present.
There is still one fundamental matter: we must revise some of the WTO's mechanisms. The EU must not be held prisoner by them. That is the purpose of our amendment to the Thomas report.

Nicholson
I welcome this report as an effort to go as far as possible in assisting ACP countries within the constraints of the WTO ruling. Of course, the WTO ruling means that we cannot help those ACP countries as much as previously but this report, in line with the Commission proposals is the next best option.
Banana reform is an area where the modern organization of world trade seems to have little regard for traditional ties between countries. We, in the UK, have long-standing links with Caribbean countries in particular. It is a shame that the WTO does not seem to recognize such links. The UK, of course, is not the only Member State which recognizes its obligations to traditional producer countries.
I share the rapporteur's concern that the abolition of the licences for individual producer countries could undermine the position of some countries in the EU market. Additional support measures to balance this are clearly necessary.
In the broader context, the long running controversy makes the point that greater flexibility is needed in the WTO if jobs are to be protected in less well off societies.

Souchet
The COM in bananas is of particular importance because banana production directly concerns both a number of European regions - particularly the ultra-peripheral areas like the French overseas departments - and a large number of third countries with whom we have longstanding and special links within the framework of the Lomé Convention.
In the face of this geostrategic and economic issue, both at European and ACP level, we must have a COM which clearly implements the Community preference and which is in accordance with the special agreements which link us to the ACP countries.
The Group of Independents for a Europe of Nations supports the Thomas report as amended by the Committee on Agriculture and Rural Development. Nevertheless, we tabled eight amendments aimed at strengthening ACP and Community production, and the marketing of bananas whose production is in line with certain social, environmental and health standards.
With regard to the ACP agreements, they must be protected as an integral whole. At the time of the signing of the GATT agreements, we raised the problem of our traditional links with these countries and the reply was that these specific interests would be protected. The result of the WTO panel shows us that our fears were not in unfounded. In actual fact, the WTO does not recognize our special agreements with the ACP countries. The question is now one of knowing if and how the serious error of negotiation committed by the Commission can be corrected, particularly in relation to the next "Clinton Round' .
With regard to Community production, production quotas must be maintained at a level which permits the protection, even the development, of the ultra-peripheral production zones. We all know that these areas are particularly sensitive and incur specific costs due to their distance from continental Europe. This is why we tabled an amendment which protects the guarantee of distribution and sale of Community products on the European market, along with an increase in the collection of customs duties for bananas coming from non-traditional ACP countries and a 20 % readjustment in the amount of the flat-rate reference income which had not been increased since 1991.
Within the framework of the WTO, it is absolutely necessary to introduce social, environmental and health clauses. As we have often said, the globalization of trade can only function harmoniously on condition that fair social, environmental and health standards are applied to all. In this instance, we would like every Member State to be opposed to bananas imported from third countries where such clauses are not respected.
Our group thus supports Mr Thomas' report as amended by the Committee on Agriculture, which is in the common interest of European producers and producers from the so-called "traditional' ACP countries. The European Union signed the Lomé agreements, thus taking on international contractual obligations whose legal force is no less than that resulting from the commitments undertaken within the framework of the Marrakech agreements. It is thus absolutely necessary that the European Union and Member States respect the obligations of the Lomé Convention.

Titley
Like many people in Britain who are keen to help the Caribbean countries earn a decent living from their principal export crop, I was dismayed when the World Trade Organization ruled that favourable EU trade rules with these island nations were against international trade laws. So I am glad that the Commission's experts have quickly drawn up proposals which should meet our international agreements but at the same time continue to allow Caribbean farmers to sell their bananas into the European market.
I understand that these changes to the import licence system will add to the cost of EU aid to the banana-growing countries. However I feel that this is a small price to pay compared to the risk that poor farmers would be tempted to grow drugs instead of bananas and merely add to the drugs problems our own countries are facing. Europe profited from its many colonies in such countries in the past, so it is only right that today's Europe give a hand-up to people in the poorest parts of the world who want to earn an honest living.

Verwaerde
Since the start of the EU, this House has been concerned with the interests of the traditional banana producers, both Community - 20 % of bananas consumed in the Union come from Martinique, Guadeloupe, Madeira and the Canaries - and ACP.
Various protocols, especially Protocol 5 of the IVth Lomé Convention, preceded the Common Organization of the Market (COM) which came into force in 1993. This was the result of a difficult compromise with the aim of enabling the distribution and sale, on the internal market, of bananas produced within the Community and bananas coming from the ACP countries, at prices which were fair both for producers and consumers, without however, undermining imports of bananas from other third countries.
Following the actions inspired by the Chiquita multinational and brought by the United States, Guatemala, Honduras, Ecuador and Mexico, the World Trade Organization demanded that the EU should modify its COM in bananas as from 1 January 1999.
I would like to congratulate Mr Thomas on his report, which was adopted virtually unanimously within the Committee on Agriculture and Rural Development. He has tried hard to find a compromise which is compatible with the WTO rules, by accepting the idea of an global quota which maintains the ACP preferences provided for by Lomé, protects Union producers and guarantees consumers a reasonable price.
When the COM in bananas was established, the Community committed itself to ensuring that European and ACP producers are never put in a less favourable situation than in the past. The reform of the COM must be guided by the same principle. It is for this reason that I support the Committee on Agriculture's position and this is why I voted in favour of its tabled amendments.
Valdivielso de Cué report (A4-0223/98)
Cushnahan
I believe the proposal to tighten border checks on counterfeit goods will prove to be a positive measure by strengthening the pre-existing 1994 regulation concerning the suspension of customs operations for suspected pirated or counterfeit goods.
While the original regulation covered trademarks and design rights, the extension of customs protection to patented inventions, as recommended by this proposal, could go a long way in enhancing the security of intellectual property. Furthermore, the proposed increase in the scope of customs authority to goods in free zones or goods already in customs supervision will extend the sphere of protection given to patents, trademarks and the like.
Ireland is one of the leading countries in software development in the EU. Cracking down on piracy and counterfeiting offences, including intellectual property rights violation, is therefore not only in the interests of the EU, but particularly of Ireland, where it will ensure the preservation of jobs in the software industry.

Kirsten Jensen, Blak and Iversen
The Danish Social Democrats in the European Parliament have elected to vote in favour of the report. The purpose of current EU arrangements is that following an application by the holder of a right, it is possible to suspend customs operations where goods are suspected of being counterfeit or pirated goods covered by an intellectual property right (brand or trade mark, design right, copyright or neighbouring right).
We support this proposal, which means in practice, inter alia, the seizure and destruction of counterfeit or pirated goods.
Aelvoet report (A4-0194/98)
Deprez
To break off trade and relations with a State is always an important decision. It can never be taken lightly, nor without conclusive and decisive justification. All the more so when it relates to aid to a country, and thus a population.
Article 336b of the IVth Lomé Convention, which provides for the possibility of a partial or full suspension of cooperation due to serious human rights abuses is no exception to this rule.
Any decision to suspend or resume cooperation is obviously a serious matter, in which Parliament should be fully involved. I therefore think it is clear that Parliament cannot be satisfied with merely being informed. Like my colleagues in the Committee on Development and Cooperation, I do not consider it desirable for the Council alone to decide on a suspension or resumption, either full or partial, of cooperation.
In the absence of assent, I consider that Parliament must at the very least be consulted regarding every case, in order to increase public awareness and to put the State in question progressively under pressure.
I consequently subscribe fully to the demand for the immediate opening of a conciliation procedure with the Council, so that the procedure for consulting Parliament may as rapidly as possible be defined by mutual agreement.
Berger recommendation (A4-0215/98)
Donnay
The proposal submitted to us is aimed at amending the directive on access to the occupation of road transport operator. It aims to make the current rules stricter in order to achieve a more thorough harmonization of the transport sector.
This proposal for amendment, which has the strong support of only a few countries, is aimed at reducing certain disparities between Member States' legislation, which risk causing distortions in competitiveness and unequal access to the road transport market.
I personally would like to insist on the need to harmonize not only the conditions of access but also the working conditions for road transport operators.
Some countries of the Union have been experiencing serious strikes by lorry drivers recently. Everyone can still remember the inconvenience these actions have caused. But they have also revealed the deep-rooted malaise of the road haulage operators. These strikes have also brought to light great disparities in working conditions between Member States.
I therefore think it is necessary to embark upon a serious consideration of the harmonization of social legislation within the Union. It would put transport operators, whose duties to employees vary substantially from country to country, on an equal footing.
Quisthoudt-Rowohl recommendation (A4-0226/98)
Caudron
Mrs Quisthoudt-Rowohl's proposal is a serious and well-founded one. Indeed, for several months all the institutions of the European Union have been talking at every possible opportunity of the need to have a research programme which lives up to our ambitions. It is clear that what is being proposed to us falls far short of what is needed.
Everyone is aware of the eminently strategic role of research and development for the future of our competitiveness on a world scale, but many seem unwilling to accept responsibility for the financial allocations required to innovate and adapt ourselves to world challenges.
Let me give just one example as an illustration: that of shipbuilding. The European Council decided to end aid to this industry after the year 2000, recommending efforts at competitiveness through recourse to new technology. At the same time, the Commission proposed merging "inland transport' projects and "marine technology' projects, this merger being accompanied by a reduction in appropriations. What are we to think?
As a Member of the European Parliament, I can no longer content myself with the fine long speeches of some leaders who are completely out of touch with the reality of the decisions.
We will not be able to hide indefinitely behind Community technocracy. We will not be able to say "white' one day in Paris, Berlin and London, only to demand "black' in Brussels. Unfortunately, recent statements from some people do not encourage optimism.
In the coming months, many of us will have to defend the idea of Europe and also to state a number of home truths, even if this means touching on some sore points. The coming years will be crucial, the political issues major ones. It will be up to the European Parliament to make its political and, I hope, its decision-making character prevail.

Wibe
Since I have some knowledge of the scientific community, I can say that, unfortunately, the EU's research programme only creates a lot of unnecessary diversions for the scientific community.
I think research should be based on voluntary international cooperation and not on artificial cooperation rules, such as that there should be scientists from three countries involved or whatever. I do not think research programmes belong in the area of EU cooperation. International scientific cooperation can still be arranged - it has been in the past.

Wolf
I would like at this point to state my regret and criticism regarding the fact that the Union's research policy (and that of its Member States and of the research association, Eureka) has not yet been discussed seriously as a key factor in the strategy of transition to a new development model. It is probable that this is simply not possible if we continue with our usual procedure. I would therefore like to suggest even at this stage that for the Sixth Framework Programme on Research and Development we start a broad dialogue with civil society, both at European level and in the individual Member States, concerning the contribution which research policy can make to a transitional strategy with a view to an ecologically compatible and socially coherent development model in Europe and beyond. In this way, particular importance will be given to including critical groups and opinions.
Linkohr report (A4-0199/98)
Fabre-Aubrespy
Mr President, as this explanation of vote begins, please allow me to point out that the way in which today's voting has been handled is somewhat surprising and I would ask you to pass this observation on to the Bureau: when the President of any Member State visits us, you do not interrupt the session and allow the Members to leave, making him speak to a House which is three quarters empty in comparison with voting time.
I would like to make two remarks concerning procedure with regard to Mr Linkohr's report. Indeed, the European Parliament has surrendered to a veritable perversion of procedure, through the vote of the Committee on Research, Technological Development and Energy. In fact, we already have a directive. A report has been proposed to us, which is an own-initiative report on the same subject, and it is proposed to incorporate into this report an annex which, on closer analysis, is in actual fact a legislative proposal on the part of the European Parliament. This practice naturally seems to us contrary to the texts which govern the functioning of the European Parliament, and contrary to normal practice. It is not for Parliament to set itself up as a legislator.
My second comment refers back to the procedural incident earlier. I regret not having requested submission of the case to the Committee on the Rules of Procedure, the Verification of Credentials and Immunities at the time, but I am sure they would confirm that if a report has an annex, the final vote cannot be taken before the vote on the said annex. It is absolute nonsense to consider that a final vote can be followed by other votes.
The first vote we were asked to give an opinion on related to whether the Commission should take into consideration the text given in the annex. So, it should clearly have been necessary to vote on the annex before proceeding to the final vote, since it formed an integral part of the motion for a resolution. Above all, Mr President, I believe that if the vote had been better prepared, we could have avoided this incident, because it would immediately have been noted that the annex had not obtained the approval of an absolute majority of Members of Parliament and thus the required qualified majority was not achieved. It thus clearly follows that the final vote on the report as a whole would probably have been negative.
By proposing to the Members of this House a vote on the annex after the final vote, by proceeding to a vote on a motion for referral back to committee when the final vote had taken place, I believe that a procedural error has been committed. It would be appropriate for the Committee on the Rules of Procedure once more to give an opinion on this, in order to avoid its happening again in the future. But basically, I come back to the fact that it is not normal to have implemented such a procedure, which comes down to giving Parliament the possibility of legislative initiative, which it does not possess.

Lindqvist
The report contains some good proposals for an increase in the proportion of renewable energy through the use of biomass, solar energy, wind power and geothermal energy. Community rules on the feed-in model could also contribute to this development. The implementation of energy policy should in principle be a national issue and be managed by each Member State by applying of its own national rules.

Pinel
The Linkohr report has one essential merit, which is that it raises the important question of the promotion of renewable energy sources. It is clearly the duty of elected representatives and governments, especially in my country, to think about the future of energy in our nations. A future which takes into consideration environmental protection, diversification of production methods, the needs of consumers, both industrial and individual, and also the security of supplies and a reduced dependence on the outside world. Renewable energy sources, those we know of and those yet to be invented, have an important role to play in defining this future policy.
But in spite of this, can we accept an ultra-statist directive, drawn up in an extremely vague legal style - and in particular in flagrant contradiction with the Rothe report - which does not respect the principle of subsidiarity, which completely ignores the specific needs of States and their energy requirements and which considers hydro-electric power as a renewable energy source only worthy of attention below a certain production threshold. We cannot, and this is why we will abstain.
It is for the Member States, in collaboration with but independent of Community structures, to set their objectives, to commit themselves to keeping to them and defining, at national level, suitable means of achieving them. Energy is too serious and strategic a sector to leave in the hands of the Commission's technocrats or in the hands of the obsessive federalists in this House.

Seppänen, Sjöstedt and Svensson
The report proposes that the EU should draw up a new directive on the feeding in of electricity from renewable sources of energy. We are opposed to this. We think this type of issue is better dealt with at national level. We are also opposed to the EU drawing up a detailed common energy policy. This point of view is based both on democratic reasons and on the fact that national circumstances in this area vary greatly.
We have therefore voted against the request for a new directive and abstained from all part votes on the shape of the proposed directive.

Wibe
Like Helmut Kohl and Jacques Chirac, I think that too many decisions that could have been taken at national level have been transferred to EU level. Just like them, I think that the principle of subsidiarity should be given real substance.
This report calls for the drafting of legislation on the feeding in of electricity from renewable energy sources into the electricity network. The objective of this proposal may be very good, but if you look sensibly at the debate this leads to about funds, special funds, investors, network operators, autoproducers, independent energy producers and so forth, it is incomprehensible that such matters have to be decided at EU level.
In think decisions concerning energy policy should be taken at national level. There is nothing to gain by making energy policy supranational. I am therefore voting against this report.

President
Since there has been a lot of debate on the subject, I would simply like to say that I too had a few concerns about whether we should split the vote on the proposal and the annex. I am not personally convinced that it was the most proper way. I still have my doubts. But in any case once we adopted this procedure I, at least tried to dissociate the one section from the other. And so there was no problem with the two votes. The first section - the proposal, separate from the annex - could remain as a proposal, as it in fact did.
Furthermore, I must also comment that we were under a great deal of pressure concerning the votes. We have recently been adopting the procedure of adjourning the voting on Wednesday when an address is given by a head of state. This has been debated in the Bureau and at the Conference of Presidents. I can understand the reservations. It is very difficult for us to start a vote, to adjourn it, to wait until Members reassemble and so on, but I do not think this is the right time for us to revisit this issue. However, I will pass on Mr Fabre-Aubrespy's comment to the President.
The third point is of course that when we move on rapidly, Members following the votes have to be quick-witted. It is no good if they realize ten minutes later that they have voted wrongly on a point. This leads to the sort of problem that we have experienced.
(The sitting was suspended at 1.45 p.m. and resumed at 3.00 p.m.)

Situation in Kosovo
President
The next item is statements by the Council and the Commission on the situation in Kosovo.

Henderson
When I last addressed Parliament on the subject of Kosovo in one of our previous debates, news was then emerging of the agreement by President Milosevic to meet the leader of the Kosovo Albanians, Dr Rugova. As Members of this House will recall, the international community then welcomed the news as an important first step on the road towards a peaceful resolution of the crisis. We were all therefore dismayed that instead of this resulting in a reduction in the fighting in Kosovo, we witnessed a significant stepping-up of the violence with indisputable evidence of indiscriminate attacks on entire villages by the Serbian security forces and the Yugoslav army causing widespread destruction with all the hallmarks of a new campaign of ethnic cleansing. Belgrade's insistence that it is simply carrying out legitimate counter-terrorist activity is not credible. The reports of attacks on innocent civilians and the systematic burning of houses are wholly unacceptable.
As the European Council made clear on 15 June, no state which uses brutal military repression against its own citizens can expect to find a place in the modern Europe. The growing stream of refugees into neighbouring Albania and Montenegro speaks for itself and illustrates the serious threat posed to regional security by the continuing conflict.
It is particularly important that the European Union remains in close touch with the aid agencies who are working in northern Albania. I welcome assurances from the Commission that its humanitarian office is in regular contact with the Office of the United Nations High Commissioner for Refugees. The humanitarian crisis will put a huge strain on Albania, a country which is still struggling to cope with its own grave economic and social problems, as I think we are all aware.
We must continue to work with the Albanian Government; to encourage them to maintain their constructive line on Kosovo. And we must think of ways to step up our assistance both to enable them to cope with the immediate crisis of the refugees and to help them to begin to tackle their own wider problems.
President Milosevic bears a personal responsibility for the actions of his security forces in Kosovo. He should be left in no doubt that the international community will not be taken in by talk of peace when the reality on the ground is ever greater repression.
There have been expectations of the dialogue which took place in Moscow earlier this week between President Yeltsin and President Milosevic. We welcome President Yeltsin's efforts to secure a political settlement. Some of the commitments on the humanitarian side represent a step forward, provided they are implemented. But some key aspects of what President Milosevic has offered fall far short of the requirements of the European Union as set out in the Cardiff Declaration.
In particular, he has given no clear commitment to the withdrawal of security forces which are engaged in repression. The European Union will now be working further with the Russians, the Americans and others to maintain pressure on President Milosevic to do all that is required of him - and work is continuing in New York on a draft United Nations Security Council resolution. As we have learned over Bosnia, we cannot afford to rely on President Milosevic's word.
I hope that the dialogue that took place in Moscow will lead to a changed situation, a better situation, a situation where the repression ends. I can say to President Milosevic that if that is not the case and if the dialogue results in no major change in the situation then the European Union's view is unchanged - we will continue to seek to put pressure on President Milosevic, ruling out no action in order to try to bring about a peaceful situation and a solution to the problems in Kosovo.

van den Broek
Mr President, I think the European Union can say that it has assessed the situation in Kosovo rightly to date, and is not, as before, simply awaiting developments without taking the necessary measures and without preparing for the worst, as was the case during the tragedy in Bosnia. The best way to try to prevent the violence and massacres in Kosovo is to make it unequivocally clear to President Milosevic that the international community is prepared to intervene to rectify such a state of affairs, or to give the necessary protection to innocent citizens -men, women and childrenwho are being shelled in their villages with artillery or other weaponry.
I feel strongly about this, knowing how many debates have preceded this one, and knowing that, in this regard, the European Union has opted for a straight line policy in close consultation with the other members of the Contact Group. During the past few days, the Cardiff European Summit has in fact confirmed the line being taken. We now have the first results from the dialogue between President Yeltsin and President Milosevic. Along with Mr Henderson, I say, of course, that this dialogue is welcome, but at the same time I reiterate what he said, that it has been shown in the past that President Milosevic's word cannot be relied upon. Actions are what matter, and in that sense it is disturbing that one of the most significant of the four conditions which the international community had dictated to President Milosevic has not been met. I am referring to the withdrawal of security forces from the area. This means that, day after day, the people in the region are afraid that they will be attacked again, just as we saw in the past in Sarajevo. At the same time it means that the international community is once again being challenged to make it clear that this all-important demand must be met, and that it would intervene if excessive violence were to break out again.
As far as that is concerned, this will not be the last debate we are having here about Kosovo. It will be one of many, and some time will have passed before we will be able to say that peace and stability has returned to the region.
I also agree with the British Presidency, that we must use our influence to support Dr Rugova and especially those who surround him, so that he is able to maintain his moderate line. Obviously, some Albanians have become considerably more radical, making it more difficult to have a dialogue without extreme demands. It should be obvious that the international community has taken a clear political stand in this matter and, for good and well-founded reasons, has opted for a solution within the borders of the Federal Republic of Yugoslavia. On this point, too, the international community must remain consistent.
The European Commission has provided the necessary emergency help via its humanitarian organization, ECHO. It recently made ECU 1.5 million available, and is naturally prepared to allocate more where necessary. In this respect as well, it is crucial that President Milosevic's commitment is verified, that the international aid organizations be given free access to the area. Incidentally, according to his promises to President Yeltsin, this should also apply to accredited diplomats of governments and other international organizations such the OSCE.
It is of the utmost importance that the number of observers in the region be increased considerably. The Cardiff European Council made a decision to do this, so that we are also continually able to get a good picture of the developments on the ground. Up to now we have lacked accurate information due to the absence of opportunities for access to the region. You know that there may be tens of thousands of refugees, or displaced people. President Milosevic's promise that these people can return to their homes will have to be carefully verified too.
I conclude by saying that there is a gleam of hope that the dialogue may be continued, that serious negotiations can take place. But I should immediately add that we should understand clearly that the greatest possible vigilance is needed to prevent the process from sliding back into in the bloody violence which plagued the region before.

Swoboda
Mr President, Mr President-in-Office, Commissioner, I should like to make a few remarks expressing my fundamental support, and that of my group, for the current policy, together with a few critical observations.
One: I think you are absolutely right to make it quite clear that the Kosovo Albanians will not be abandoned, that they have our support and that we will not allow them to become a second Bosnia.
Two: I also think we are right to maintain a critical or pessimistic view of Milosevic, and that we must therefore support all the available alternatives both within the country itself and in neighbouring countries. Though there is little hope in Serbia, there is some in Montenegro and in Republica Srpska - even if they are not all angels - but we must support alternatives to Milosevic.
Three: We must help its neighbours to stand firm in this crisis and stop them from tending towards extreme attitudes. Here I have in mind Albania and Macedonia. We must also tell the Macedonians that despite, or perhaps even because of the crisis, they must pay greater attention to the minority rights of their Albanian population and make progress in this area. Despite their effort, it is not enough.
Four: I think that NATO is right to hold manoeuvres. Unfortunately, and I have to say this, although I am an anti-militarist, in certain circumstances it is necessary to engage in a little sabre rattling.
Five: I also believe we are right to prepare for military intervention if Milosevic does not give way, and therefore I also believe that we must do everything possible to ensure that NATO makes all the necessary preparations for such intervention.
Six: I should like to appeal to Russia - and I assume that both the Council and the Commission are making this clear and unambiguous - to shoulder its responsibilities. If Russia wants to play a significant and increasing role in overall European security policy - and I think it would be good if Russia were to do so - now is its opportunity to show it. Because for those who are friendly with Serbia or with Milosevic as the President of Yugoslavia, now is the time to put this friendship to the test, by speaking up for peace.
My seventh and last point, Commissioner, is the following. You have said that the EU is doing everything it can. And it may well be true that it is doing everything it can at the moment, but - as we have already mentioned on a number of occasions - this is a crisis which we undoubtedly saw coming. We know that Milosevic needed just such a crisis.
Looking at the outcome of the Cardiff summit, Mr President-in-Office, and reading Point 47 which states that progress has been made and further resolutions will be passed at the Vienna summit, then in truth I have to say that I find the whole thing rather weak. Rapid progress is essential on the planning unit in particular, so as to prepare for an active foreign policy.
We will only be able to prevent a second or a third Bosnia or a second Kosovo if we have a strong foreign and security policy. So, to conclude, Mr President, I fully support the principle of subsidiarity. But we should consider where we need a stronger EU. We need a stronger European Union in foreign and security policy.

Pack
Mr President, ladies and gentlemen, we are now experiencing a fatal sense of déjà vu , because the results of the events that took place in Moscow amidst great media excitement are really only minimal, not to say non-existent. The promises made by Mr Yeltsin were promises he had already made to the Americans. He had even been praised for them. They were the very reason the sanctions were lifted. I, for one, am not surprised that things have turned out this way. At the time I found no cause for celebration because I knew all too well that Milosevic had not changed. Perhaps at that age you just cannot change. But if that is the case, we must take note, because he behaved the same way in Bosnia, and it is how he is behaving now. He agrees to hold meetings, but without an international mediator, and at the same time - just as he did in Bosnia - he is sanctioning murder and pillaging. The fact is that there are once again concentration camps and even mass graves in Kosovo.
We were all aware of it, we all saw it coming, yet we failed to act. By we, I mean the European Union. Unfortunately, Parliament cannot act, we can only suggest possible courses of action. If Milosevic now refuses to withdraw the Yugoslavian army and his police troops on the grounds that the Albanians must first stop their terrorist attacks, he is confusing cause and effect. It is really he who is responsible for this whole affair. For eight years now the Albanians have endured an apartheid regime with great forbearance. Who then is surprised that after eight years of such an apartheid regime the young men are saying, we just are not going to put up with that any more. We are not going to let our wives and children be murdered. We are not going to be driven out. So we need to exert much greater political and military pressure on Belgrade. We need UN troops between Serbia and Kosovo, because that is the source of the evil.
Milosevic is playing with the West. He is leading us around by the nose. And we know it. He knows all too well that the West places far greater importance on the implications in terms of international law of possible NATO intervention than on actually putting an end to the aggression. The UN Charter was written in 1945, at a very different time, and is now out of date in this respect. We really must make sure that intra-ethnic conflicts do not have to be played out before the international community in this manner. If we had acted in Sarajevo as NATO wanted us to, Sarajevo would not have remained surrounded, fewer than those hundreds of thousands of people would have been driven out, fewer would have died, and we would not now be faced with the never-ending costs which we are all having to pay.
The problem is that Milosevic knows what he wants and is doing exactly what he wants. And we're letting him do it. That is our problem. Now he can see a new Dayton on the horizon, and because he can see this new Dayton, we are seeing ethnic cleansing in north west Kosovo. He is driving out the Albanians who live there because, allegedly, it is the cradle of the Serbian nation and because it is rich in natural resources. And when he has driven them all out, and only then will he be forced to look for a solution, which we will propose. This is why we should act now and not leave the people of Kosovo in the lurch.

Frischenschlager
Mr President, Commissioner, on this occasion I, too, am unable to share our view that Europe has acted in a timely manner. This time no one can honestly pretend that we did not know something of this sort would happen. And it is the case that military terror is being used for ethnic cleansing. It is a fact. And we reacted too late. For years Albanian resistance in Kosovo was based on non-violence. We failed to use this time to exert pressure on Milosevic through sanctions, to find a solution. Shamefully, this time was squandered.
Now there is one point which I believe to be particularly important. We must not only exert this pressure, we must maintain it until one basic right has been accepted by everyone, including the Serbian leadership - the right to return. He cannot drive out as many Albanians as he will have to allow to return. We must get this through, it is a really crucial point.
How is it that Milosevic is able to act in this way? Because he controls the media like a dictator. It is my view that the European Union should consider what it can do for the Serbs, for the population of Serbia, to show our sympathy and our regret. Our policy should be directed against the leadership but, of course, not against the Serbian people. But they have become hostages because they do not know what is going on. I wonder whether there is not some instrument we could use to tackle the situation, for example by creating an alternative stream of public opinion in Serbia. I am thinking of a model such as the Radio Free Europe of the past, by which we could give the population of Serbia access to accurate information. Then I believe that the leadership in Belgrade would not be able to act in the way it is doing now and we would be nearer to achieving our goal of achieving peace, democracy and human rights for everyone in the area - for Albanians and Serbians alike.

Caccavale
Mr President, President-in-Office, Commissioner van den Broek, ladies and gentlemen, the Commissioner said that Milosevic's words in the past were not enough: a wonderful euphemism for what in Italy is known as a tall story. Milosevic could be compared to the personality we in Italy call Pinocchio, meaning a liar, an out and out liar, as occurred in the past. Commissioner, let us call a spade a spade!
This morning I heard Milosevic himself say in English that civilians had not been harmed, that the special forces only intervened against terrorists. Here is further proof of how Milosevic is Pinocchio, that is to say, a liar, Commissioner! It is not just what you said, that Milosevic's words are not enough: Milosevic's words are worthless! You also told us that there is a condition which has not been observed. And what condition is that? Only the most important, the immediate withdrawal of the special forces. The very fragile compromise reached between Milosevic and Yeltsin does not consider the most important point: the withdrawal of the special forces. The truth is that Milosevic wants to buy time, with the acquiescence - if not with the approval - of the international community, as has occurred in the past. We treated him like Bosnia's best negotiator, the torturer and dictator Milosevic; well, now we tell him that it is also alright to keep the special forces to continue the deportation and ethnic cleansing of Albanians, but with all this the poor Albanian community is yearning for the old unforgotten Marshal Tito: need I say more!

Alavanos
Mr President, both of the President-in-Office of the Council and the Commissioner made some interesting points. I think that we must not move away from two fundamental principles: on the Serbian side there is the question of the independence of Kosovo and democratic rights, which goes beyond the national issue, the issue of the borders of Yugoslavia. On the Albanian side there is the question of respect for borders by the European Union, Russia, the United States and by both communities.
On the basis of these two principles, boundaries can clearly established by the international community and the two sides can be reconciled. I too believe that the discussions taking place in Russia are sending out a positive message that could be taken on board.
However, I wish to make three points.
The first point is that we must pay particular attention to what is happening in the Balkans. We cannot set up borders in the Balkans which reflect the nationality of each community that lives there. The reasons for this are, firstly, because this very nationality is in doubt and, secondly, because the borders are so short, and the situation so fragmented, that we will turn the Balkans into a sieve. Are we to set up borders for Kosovo and then erect borders around the Serbian minority living in Kosovo? That is the first issue. We must understand the Balkans and their special place within Europe.
The second issue is that we have heard a lot about Milosevic - with which I agree. We have heard about Milosevic, and about Tudjman and about Izetbekovic and the International Court. But tell me one political power in Serbia that holds a different position. Even Tzuganovic in Montenegro does not put forward an alternative position in Kosovo. This is important for us to understand the whole issue as a problem for the Serbian people itself and for us to deal with anxieties and problems.
The third point is that, with the measures against Yugoslavia, there is a danger, and I am addressing this comment to Mr van den Broek, that some of the refugees from Crna and elsewhere, who are now in Yugoslavia, will leave for the Serbian Republic of Bosnia and then we will have more enormous problems.

Aelvoet
Mr President, ladies and gentlemen, if there is one thing practically everyone in this Parliament agrees on, it is that the behaviour of the regime in Belgrade is so shameless and repressive that effective international action must be taken. We therefore fully support the international pressure that is being applied to the regime, in as far as diplomatic, political and economic initiatives are concerned. However, if the international community believes that there are situations - and this is most definitely the case here - where military action must be considered, this must take place with the utmost care.
In this context, ladies and gentlemen, I have two serious difficulties with our joint resolution. The first problem is that the resolution contains no reference whatsoever to the institutional framework within which a solution, a political solution, has to be found for Kosovo. In particular, it does not say that a solution must be sought within the existing Federal Republic of Yugoslavia. The arguments which have been developed in the direction of the right to self-determination for nations, or in the direction of "we must leave everything to the negotiations' , are dangerous and not at all convincing. They create the impression towards both sides that almost everything is possible, and that no matter what happens or what solutions are aimed for, we will always be behind the Albanians. It seems to me beyond dispute that the Albanians should have a right to self-determination, but not in every conceivable context.
My second major problem is that a possible military intervention is not made subject to a Security Council decision. Ladies and gentlemen, this creates a dangerous precedent. If the UN Security Council does not give its assent, and countries start acting autonomously towards others, then this is, first of all, a clear violation of the UN manifesto. In this situation you would, in fact, have a kind of indirect declaration of war. Secondly, you should also look at what you would achieve with military intervention. As far as we are concerned, we absolutely believe that all forms of military action are possible, but only as a conditio sine qua non within the UN framework.
In conclusion, we welcome the Russian initiative. However, we are not naive: we are aware of the fact that if the pressure is not maintained, it could easily lead to nothing.

Pradier
Mr President, people have been predicting this unfortunate state of affairs for years and nobody has listened. There will be trouble in Kosovo, they told us, but the upheaval was a long time coming and everybody waited. The Slovenians, the Croatians and the Bosnians have all successively cast off their shackles. The Federal Republic of Yugoslavia exploded into a small group of micro-States whose viability still remains problematic. Was this in response to Serbian dictatorship? Certainly not, but rather in response to the dictatorship of one man, a pure product of totalitarianism, who imposed - firstly on its people, then on its federal republics - a form of government inspired by the worst regimes, those which have plumbed the depths of infamy. The doctrine of racial superiority; the ideological weight of a church which replaced the single party - a party which moulded the childhood of this despot; intolerance and contempt for its neighbours; the massacre of opponents, often unarmed, who are driven by the bus load to the edge of the grave to be executed: this is what caused this detestable dismembering of a republic which was, nevertheless, one of the first to sign the United Nations Charter. Must we then resign ourselves to signing its death certificate? In the short term in any case, it would be unrealistic to hope for its resuscitation. Faced with the situation which today confronts us, must we continue to wait until other layers of corpses cover those of Srebrenica? Of course, we all know that independence for Kosovo is not a viable solution in the long term, that the multiplication of States which hate their neighbours is disastrous and also that to tamper with borders which are internationally recognized is like building a house of cards, which will bring many others down with it. So what should be done? Should force be used? But in order to do what? Purely to put a stop to the murderous actions of a dictator? Operations of the "Determined Falcon' kind, flying noisily over neighbouring countries? Is this the case? Anyway, doubts have to be raised on the sending of United Nations observers who will write masses of daily reports whose effectiveness we are all aware of. To content ourselves now with sending observers would be a classic example of a lukewarm gesture, of an ineffectual attitude, of shameful cowardice. If, as many here think, there is just one root cause of all of these tragedies, and if we want to stop the Serbian people suffering a further defeat after the catastrophes they experienced in Croatia and Bosnia, we must try to ensure that our intentions are clear. The aim we must now pursue is one of bringing down a dictator who is leading his people, and the whole of the Balkans, into a spiral of violence; to give back dignity and a political say to all of the people of these countries, and to restore Serbia to democracy. For this will it be necessary to issue an international arrest warrant, to arrest Milosevic and to bring him before the International Court in The Hague? Very probably, yes.

Wiersma
Mr President, the situation in Kosovo is untenable and unacceptable. The so-called willingness of the regime in Belgrade to start talking to the Albanians may sound beautiful in Moscow, but the hard reality is one of brutal repression and ethnic cleansing. Milosevic is still not prepared to withdraw his troops from Kosovo, and under the pretext of combating violent terrorists, the entire population is being attacked, with streams of refugees as a deliberate result. Incidentally, this strengthens separatism rather than weakens it. The regime in Belgrade seems indifferent to international pressure. Sanctions do not stop it from continuing its violent actions, despite the rhetoric on political settlements. More pressure is needed whereby, as far as we are concerned, military intervention should not be ruled out. NATO has rightly sounded a first military warning this week. We support the preparations for possible further action. The results from the Moscow dialogue are no reason to abandon this strategy as yet. The objective of this strategy should not only be to ensure the cessation of violence, but also to bring about real negotiations, where, as mentioned before, the special units must be withdrawn from Kosovo as a precondition.
I also think that the international observers must be allowed into the region to see what has really been happening, and also to make contact with the people. The European Council - and I think this is an important aspect of our policy on Kosovo - has made clear what the objective of such negotiations and talks should be: the restoration of Kosovo's autonomy, or to put it more precisely, a special status with a large degree of autonomy. This sends a clear message to the parties concerned, and to the separatists too. The independence of Kosovo is not on the agenda, as far we are concerned. This will lead to quite a discussion in Kosovo itself, because I have the impression that many Albanians who live in Kosovo have come much closer to the idea of independence as a result of the hostilities than they were a few months ago.
There is another important point - and this is the last point I want to raise - and that is the discussion on a mandate for possible military action in the context of NATO. Some people think that this does not require the involvement of the UN, others believe it to be an absolute precondition. In any case, my group wants to see the UN involved. We would prefer it if the UN legitimized a possible military action, and this should therefore be advanced as a matter of urgency.

von Habsburg
Mr President, what is missing so far in this discussion is a clear expression of how admirable the Albanian people in Kosovo have been and still are today. For years and years - going back to a period far beyond the one we are currently dealing with - they have endured with incredible patience - I would say an almost Ghandi-like patience - whatever their oppressors have thrown at them. This has been the pattern for years. Statements are now being made criticizing the fact that young Albanians have quite simply lost their heads and reacted in military fashion, but we really have no grounds for criticism when we consider Albanians' past record. That is my first important point.
My second point is the fact that all too little is being said about the most essential aspect of the problem. The real crimes are being committed by the so-called voluntary units of the Arkan and others which were previously responsible for killings first in Croatia and then in Bosnia and are now all in Kosovo. This is a second factor which we must stress. It is simply not enough that Moscow has now said some may be sent back. In fact, Yeltsin has yet to give his authorization. We must once and for all call for these so-called guerillas, the Chechniks, to leave. They are one of the major evils in the whole business.
Today we are discussing the future of Kosovo. There is, however, one thing I should like to emphasize. We are democrats and it is time we finally gave the inhabitants of Kosovo the chance to determine their own future. It is something they have been unable to do for decades and, like other peoples, they are entitled to say how they want to live. So we must have the courage to speak openly and to demand that dramatic action should be taken at last, for I believe this is a situation which could become just as bad as Bosnia.

Caccavale
Mr President, let me protest once again. The Commission, Commissioner van den Broek in particular, decides halfway through the debate on a matter as important as Kosovo to walk out and leave the question half-finished. This is a disgraceful attitude showing great disrespect for this Parliament.

Bangemann
Mr President, I do of course understand that the Members are unhappy that the Commissioner responsible cannot remain until the end of the debate. It is understandable. On the other hand, we would ask you to understand that the dates of trips made by Commission members have to be set before Parliament's agenda is finalized. Mr van den Broek accepted an invitation to Slovakia and so he has had to leave now. He spoke earlier and expressed the Commission's views on this matter.
I am here, I admit, simply as a representative of the Commission and I do not intend to take part in the discussion. I would, however, ask you to understand that the Commission also has to work in difficult conditions.

Van Bladel
Mr President, I also wanted to tell my colleague how, immediately after the vote, Mr van den Broek expressed his regret that the debate was postponed due to his appointment in Bratislava. I understand what Mr Caccavale is saying, but we must still have some understanding for the work the Commissioner does. It is not that I, by definition, want to defend him, but the Commissioner has a very real job to do, and was simply unable to cancel the appointment in Bratislava.

President
Ladies and gentlemen, neither the Bureau nor this House is responsible for the way in which the Commission is organized. That is the Commission's own prerogative. Let us simply note that fact and continue the debate.

Cars
Mr President, there is a war going on in Kosovo. It is based, among other things, on the Serbian national romantic image of Kosovo as some kind of ancient homeland. On these grounds, Serbia maintains its absolute sovereignty over the area, in spite of the fact that more than 90 % of the population of Kosovo are Kosovo Albanians. That is why it cannot be ruled out that one of Milosevic's aims is to get the Kosovo people to flee. But he must not be allowed to succeed.
To prevent this, the EU and NATO must get Milosevic to realize that continued Serbian aggression will not be tolerated. In this regard I appreciate Mr Henderson's decisiveness. However, it will not be easy. Milosevic has shown several times in the past that he carefully watches the other players' hands, and that he does not negotiate until he has lost the military battle.
After the meeting with President Yeltsin, Milosevic said he was willing to negotiate. But negotiations have never before prevented Milosevic from stepping up his military efforts.
Even if a Russian veto blocks the Security Council, the EU and NATO can station troops on the borders of Kosovo. But what would we gain by that? With good refugee camps you counteract destabilization, but at the same time you risk encouraging people to leave Kosovo. Those who flee know that they will get protection, food and shelter in the camps they go to.
Another task could be to try to prevent the smuggling of weapons to the Kosovo Liberation Army. That would just be playing into Milosevic's hands and be parallel to the arms blockade which for a long time kept the Bosnian Muslims at a military disadvantage. My conclusion therefore is that not much of value would be achieved by border controls alone.
Perhaps Moscow's position on the Security Council is primarily aimed at gaining advantages for Russia in exchange for Russian consent. But the EU and NATO cannot accept having their hands tied under any circumstances. The attacks on Kosovo must be stopped. If Milosevic succeeds in crushing all resistance and opposition there, all negotiations on Kosovo's future status will be meaningless.
What the citizens of Europe expect of the EU and NATO is that no country in Europe should be allowed to restrict freedom in any area of our part of the world.

Andrews
Mr President, as this will be my last opportunity I would like first to congratulate the British presidency. You have run a great presidency. Well done!
The fact that it has not been possible to deliver humanitarian aid in any structured manner to people in the Kosovo region does not reflect very well on us in this House. I am a member of the Committee on Development and Cooperation, which was assured by the Commission that early warning systems had been put in place by the European Union to deal with humanitarian aid missions of this sort. Clearly this has not been the case and must be viewed as an abject failure for the so-called humanitarian aid programmes the EU is supposed to operate on occasions like this.
From an Irish perspective, we should assist in humanitarian missions to the region. We should not have to wait for the United Nations in New York to give us the go-ahead on this issue. This is a European problem on the borders of the European Union and, if the integrity of the European Union is to remain intact, it must be resolved by the Member States of the Union.
There can be no neutrality when we are confronted with a brutal genocidal dictator such as Slobodan Milosevic. He must be forced to observe the Dayton Peace Agreement and international law in practice as well as in theory. We must not stand on the sidelines in a disjointed and idle fashion and allow Slobodan Milosevic to run rings around the 15 Member States as he has done in the past.
Ireland must be prepared to play a constructive and positive role within the framework of the European Union to assist in solving the crisis in Kosovo and in guaranteeing that Slobodan Milosevic does not achieve his aim of bringing about the genocide of the native Albanians in Kosovo. We in this House watched murder and rape in Bosnia. We appear to be doing the same in Kosovo. It is a shame on this House that we do so.

Sjöstedt
Mr President, the people responsible for the conflict in Kosovo are quite clearly the Yugoslav regime and Milosevic. It is not particularly surprising that after years of severe oppression people should finally take up arms to fight for their cultural and democratic rights.
What we now see is a scenario which is disturbingly like the one we witnessed in Bosnia. The civilian population is being driven out, people are being herded together in prison camps in certain places, and gangs of criminal thugs are being let loose to terrorize the civilian population. That is, of course, why every pressure must be brought to bear on the Yugoslav regime.
Ultimately, it is impossible to rule out the need also to use military means, although that is, of course, always the last resort. What I think is important in that case is that there should be a clear UN mandate. I think taking military action without a mandate from the UN could be a very dangerous development for two reasons. Firstly, of course, there is the reason of principle, namely that it is doubtful whether it is right to authorize others to take militarily action in other conflicts. Secondly, the really great risk with this conflict is that it will spread to other areas in the Balkans, to neighbouring countries. The risk of it spreading would probably be much greater if anyone acted without the support of the UN. That is why, in spite of all the difficulties, we must now seek a clear UN mandate. That is our main task.
Furthermore, I think the preferred option should be the restoration of democratic rights and the rights of the Albanian people within the framework of a Federal Republic of Yugoslavia with restored autonomy for Kosovo.

Cohn-Bendit
Mr President, ladies and gentlemen, much has been said in this debate, but some of it represents a real challenge. If it is true that the people of Kosovo cannot easily be afforded the right of self determination because of the overall situation in the region, then a second conclusion also has to be drawn. As long as Milosevic stays in power it is, of course, extremely difficult to tell the Albanians that they must continue to live under the yoke of Milosevic. That is the problem. It means that if we take ourselves seriously we must do everything we can to get rid of Milosevic. As long as Milosevic stays in power the Albanians will want to leave. That is only to be expected. The problem is that our objectives can only be achieved once Milosevic and his terrorism have been removed. That is my first point.
My second point, Doris, with all due respect, is that if we do not accept that we are bound by international law we can do nothing. In other words, we must do everything in our power to show Russia and China that they cannot simply say, "Oh, you know, what is happening in Kosovo is not really so bad. It is what we did in Chechnya.' Or in the case of China, "It is not so bad, it is what we are doing in Tibet.' We must tell them quite clearly that there will be no economic cooperation and no support for Russia if they support Milosevic. In other words, we must secure a UN resolution which permits military intervention and there must be no doubt about it. We have to do this through the UN because we cannot allow what has happened in Chechnya, in Tibet or in Bosnia to happen in Kosovo. The only way to proceed is through the UN. But we must give ourselves the means to be able to say to the Russians and the Chinese, "Enough is enough.'

Titley
Mr President, we must not lose sight of the fact that we are not just debating Kosovo here, because, of course, Milosevic has been using these hostilities as an opportunity to tighten his grip at home and to withdraw freedoms from the Serbian people. Clearly, our approach to Kosovo has to be part of a consistent long-term strategy for dealing with former Yugoslavia. If we allow Milosevic to get away with what he is getting away with in Kosovo, he will also endeavour to do that closer to Belgrade. Equally, Tudjman will do the same in Croatia. So it has to be part of a longer-term strategy.
Having said that, we must be aware that, if there is military intervention in Kosovo, it will mean NATO declaring war on a European state. We have to avoid that at all costs, if at all possible. The consequences are too horrific to contemplate.
So, first of all, our strategy has to be to keep the international community together to ensure that we all speak with one voice. The experiences of 1914-1918 have shown the folly of trying to divide international opinion and, in particular, we do not want a proxy war between NATO and Russia. Equally, we must ensure that all the states talk honestly in their approach to Kosovo. It is not enough to demand military action if you are not prepared to provide the necessary forces, because we will have to have effective burden-sharing in any military action. Some countries which talk hawkishly are not prepared to support their words with actions.
Secondly, we must not undermine the message: 'autonomy but not independence' . Any other talk is irresponsible folly: it will only worsen the situation and cause bloodshed, not stop it. Equally, as part of that, we must recognize in Kosovo that we have to guarantee the rights of the Serbs as well as the Albanians, because while fear dominates Kosovo, it will be impossible to find a solution.
In addition to demanding that the KLA withdraw, we must also demand that the security forces withdraw, but it has to be both. We must talk tough and act tough with the KLA as much as with the security forces.
We must also give greater support to Albania and Montenegro. Because their governments have been supporting this we must guarantee their borders.
Our first objective - and I support the conclusions of the Cardiff Summit - must be a cessation of hostilities to allow international observers into Kosovo to view the situation for themselves. But we must not lose an even-handed approach, because it will achieve naught if we make the Serbs in Kosovo fear for their future as much as the Albanians.

Graziani
Mr President, it would be rather easy if Parliament could count on the will of the protagonists to find a solution to the problem. Unfortunately, we cannot count on the will of the protagonists and we do not even have the adequate means to impose our will on the protagonists. It is on this basis that we must rationally begin. And then we are forced to rely on the talks. It is true that Milosevic is not very trustworthy, it is true that he did not agree to withdraw the security forces, but if it were possible to implement what has been granted, the presence of the international observers and the Red Cross and the existing means would probably be enough to calm the situation and enable a solution to be found.
This is, in my view, the only attitude possible, the only rational view that we can take: spes contra spem , someone said. The least we can do, therefore, is to pursue this objective through negotiation. There is no other way for the European Union than to rely on NATO for military pressure and on the UN for pressure from the international community. We must keep these two points of reference and try to urge, to pressure the parties so that the negotiations are real, genuine and internationally guaranteed.
Europe can do no more than that and it cannot go about it in any other way, because it does not have a political lead. Where is the European mediation? Where is the initiative taken by Europe, where is González? I don't mean González as a person, I mean where is Europe through González. There is not one, it does not exist. So we must rely on the UN, we must rely on international pressure, we must rely on negotiation, bearing in mind, unfortunately, what is a depressing fact for us: our paltry means to influence this situation.

Van Bladel
Mr President, in less than three month, the sanctions against Serbia have been lifted and reinstated again; this is a sad state of affairs. The KLA is meanwhile accusing Dr Rugova of being a traitor to the national Albanian cause, and is taking advantage of the resulting confusion. In Albania, the mafia is raiding arms depots under the patronage of the dubious Berisha, and is supplying weapons to the KLA. The political wing of the KLA is doing everything it can to undermine the image of the moderate Rugova in order to qualify itself for the negotiating table, at which it will arrive with an extreme demand: independence, or perhaps a Greater Albania. It should not be allowed to get as far as this because we would then be heading towards a Balkan war.
I have a number of specific questions for the Council. Does the Council share the opinion that Serbia will only be prepared to negotiate once it has certainty regarding its borders, including Kosovo, and the elimination of the KLA? Can the Council confirm that it also intends to weaken the KLA and strengthen the position of Rugova? Mr van den Broek was very clear about this. Does the Council believe that the recent NATO actions have contributed to this objective? In March, in this very place, I asked Mr Henderson to send military observers to the border between Albania and Kosovo. He did not respond at that time. Is the Council now prepared to send strict observers to the area into which the KLA is smuggling weapons and provoking conflicts? A great deal more could be said about this subject, but I will confine myself to these questions.

Ephremidis
Mr President, in a climate of anti-Serbian feeling running at fever pitch, proclaiming the mistakes made by Milosevic - and he has made mistakes, criminal mistakes - it is impossible to deal calmly and prudently, as called for by Mr van den Broek, with the horrific crisis which is smouldering in Kosovo. We need to look at it with a clear head.
There are forces inside Kosovo, outside Kosovo, outside Europe, who have threatened military intervention as intimidation and blackmail, or have threatened to carry out military intervention which would dismember present-day Yugoslavia, with repercussions throughout the Balkans, in order to create puppet states that will play their game and serve their interests. This is not what the people of Europe, the people in the Balkans, or the Albanians in Kosovo, want. They all want a peaceful settlement, which means respect for the borders that were established as a result of wars and were guaranteed by the map of the UN, just as they are guaranteed by the Helsinki agreements. They want a peaceful settlement with respect for all minorities' rights, and they want with independence without separation, because otherwise we will never find a lasting settlement in Europe.
Finally, it strikes me that no-one seems to be aware that conditions are currently being imposed on Serbia, on Milosevic, which, by definition, are unacceptable. Where is he to withdraw his forces from? From Kosovo. But Kosovo is an integral part of the Yugoslavian Federation. What state, what government would accept not being allowed to have an army in one of its component parts? This condition cannot, by definition, be complied with. It has been imposed on purpose to give a pretext for intervention. We are categorically opposed to any form of military intervention because it would have horrendous consequences. This Parliament has the power to throw all its political weight behind a peaceful settlement. Only then will it be fulfilling its mandate...
(The President makes the speaker stand down)

Barón Crespo
Mr President, ladies and gentlemen, this is the time to send two clear messages. The first is a message to the Council because, for the first time, in one week there has been a Council of Ministers, on Monday, which adopted a common position; a meeting of the contact group; a meeting of the NATO Council of Defence Ministers; and a meeting of the Council of Europe. And whereas we have always complained - rightly, I believe - that decisions were never taken quickly enough, on this occasion we can say that everybody was in tune and there is a definite will to say: "Things have got to this stage and they cannot be allowed to go any further' . I think that fact has to be welcomed because it will help us to develop our common foreign and security policy, which is so important.
And it is linked with the second message. I think the second message essentially has to be addressed to Mr Milosevic. People here have been asking what has happened to our Mr González. I have to say - not in defence of Felipe González, who has told me of his interest in this resolution - that the problem for the EU and OSCE envoy is that Milosevic does not want to see him. Why does he not want to see him? Because when he was in Belgrade, just after the rigged Yugoslav elections, he managed to get a complaint made and Milosevic had to back down.
Those are the reasons why Milosevic will not accept, but they are not reasons for saying that we do not have a presence.
I think there is an important difference, apart from our extreme fondness for severe self-criticism. I think Milosevic needs to be told very clearly that a dictator - who has changed from the previous communist terminology to nationalist terminology - has no authority to kill his own fellow citizens, quite apart from the fact that he is already exploiting them in all sorts of ways. He has no such right either in international law or in human law. He has to be told that this is his last chance, and that it is not the fault of the Serbian people, but that the political responsibility rests squarely with him.
I think we have to encourage the Council and the Commission to carry on down the path we have started on.

Sarlis
Mr President, first of all I must congratulate the British presidency on the very complete and comprehensive Cardiff declaration.
I think that all those currently involved in Kosovo, especially the Serbs, must realize that this Summit decision has the unanimous backing of the fifteen Member States. They must also realize that the political will exists to implement the measures decided upon by the fifteen in Cardiff. The leaders in Belgrade need reflect on their heavy responsibilities towards the muchafflicted Serbian people and to consider where the imprudent policy of armed confrontation, the responsibility for which lies in the political and military regime of present-day Yugoslavia, is leading the Serbian people and the people of Montenegro.
We all hope that yesterday's Moscow pact will be put into practice. Both Europe and NATO, however, are determined to take whatever steps may be necessary against anyone undermining the pact. We have learned the lessons of Bosnia.
Turning now to the people of Kosovo, I wish to emphasize the importance of the European call for self-restraint and for support for Dr Rugova. I also wish to give equal prominence to the common and unanimous position of Cardiff, which is that the European Union remains steadfastly opposed to the idea of independence and that it will continue to support a special regime for Kosovo, which will provide for broad autonomy within the Federal Republic of Yugoslavia.
Finally, we must understand that both Albania and FYROM need substantial support, especially FYROM, as an attempt to get closer to FYROM is being made by Yugoslavia, which is exploiting the problems this state is having with the Albanian minority in the Former Yugoslavian Republic of Macedonia.

Spencer
Mr President, I accept that the mandate is a problem. But if what is happening today in Kosovo was happening just across the border in Bosnia, we would not be hesitating to use military force. We have to be absolutely clear in our own minds that what we now call Yugoslavia is a fiction. What we are really talking about is Serbia and a province, absorbed by Serbia in dubious circumstances, that is 92 % Albanian.
We have to be clear and find a quick resolution to that mandate problem because otherwise every month we spend debating the nature of our moral right to intervene, there is a blood price paid by the people of Kosovo. Therefore the key is to regard this, as Mr Titley indicated, as a problem of Serbia and of the regime. The one thing which has been clear in the whole crisis of former Yugoslavia is that Belgrade has regularly made assessments of Europe's willingness to act and concluded that we would always act late and weakly. This House should state very clearly to Belgrade: 'Do not believe that we are incapable of learning; do not believe that we cannot tell the difference between a regime and the Serbian people; and do not believe that at the end of the day we will not be prepared to intervene' . It would be helpful if this House now or on some later occasion cut through the diplomatic language which is necessary for the Council and Commission with a view to action of a qualitatively different kind. The international community will intervene. What we mean is that if this goes on Europe will fight and Europe will be right, even if that means the death of our own soldiers in former Yugoslavia. Mr Milosevic and the Serbs need to understand that and if we fail to make it clear, the blood price for our indecision will be paid in Kosovo by innocent people as it was paid in Bosnia-Herzegovina.

Oostlander
Mr President, I have taken note with great interest of the statement from the Cardiff Council, in particular the four demands. I find the order in which they were put extremely important. I would like to ask Mr Henderson whether he wants to keep this order, because we will have to ensure, first of all, that Serbia withdraws its troops to Belgrade before we can invite Dr Rugova to resume the negotiations. If we want to destroy Dr Rugova's reputation completely, we must force him to enter into negotiations now, without conditions and despite the fact that the troops are still there. Then we will destroy Dr Rugova's reputation completely. I think we have to be extremely careful that these conditions, as formulated by the Council and rightly mentioned in this order, will be maintained.
Mr President, dialogue with President Yeltsin was mentioned. The question is whether this will lead to further Russian cooperation. The President-in-Office gave the impression that this would be the case. Is it true that after the failure of Russia to make a real contribution to the talks with Milosevic, they will be willing to agree to military intervention, if necessary? This strikes me as a good thing, but a little more clarity would be in order here.
In any case, I also agree that assent from the UN Security Council is needed, but not on the backs of hundreds of thousands of victims. We can say that it is wonderful that we will always respect the Chinese veto, but surely we do not wish to sacrifice huge numbers of human lives to this principle. This would be a little too theoretical. I am very interested in what people are thinking when they say that the Kosovo Liberation Army should withdraw. I think this almost qualifies for the "remark of the month' prize. Where should these troops withdraw to? They do not come from Albania; perhaps they come from Western Europe, but mostly they come from the region itself. Surely you cannot in all seriousness believe that this is consistent? The withdrawal of the Liberation Army and the withdrawal of the troops?
Mr President, I would like to advise the President-in-Office to consider his predecessor Douglas Hurd as a frightening example. I hope he will not use Realpolitik the way Mr Hurd did. In this respect, please do not listen to my colleague Mr Titley, who deserves the "Douglas Hurd prize' for Realpolitik .

Stenzel
Mr President, the situation in Kosovo represents a security problem of the first order for Europe. The tragedy has proceeded according to the familiar pattern of Serbian politics we have already seen played out in Croatia and Bosnia-Herzegovina: targeted displacement of the population and massive streams of refugees shifting the crisis to neighbouring countries in the region. So far the NATO manoeuvres have been purely symbolic in nature. The flying ban imposed on the Yugoslavian Airline JAT, and confirmed by the Council of Europe, is a feeble gesture. The fact that in Cardiff the European Council left open the carefully circumscribed possibility of a military option demonstrates the extent of the international community's paralysis is in relation to the crisis in Kosovo.
This crisis management is an embarrassing reminder of our reactions to Iraq and Saddam Hussein. By waiting for the Security Council's green light on military intervention we have effectively provided Russia with a means of preventing NATO's involvement and, at the same time, we have given the Serbian leadership additional time by allowing the meetings between Yeltsin and Milosevic. The withdrawal of the Serbian Special Police from Kosovo was made conditional upon the actions of the Albanian underground organization, the UCK. The conflict within the EU on whether military intervention by NATO should take place with or without a mandate from the Security Council has given Milosevic more time in which to continue his policy of expulsions unhindered.
In these circumstances, the call to the international community to use every means at its disposal to put an end to the attacks against the civilian population is in danger of remaining completely unheeded. The start of negotiations between Belgrade and representatives of the Kosovo Albanians should be made conditional upon a moratorium on the fighting. The statements made by the European Parliament are a feeble substitute for the lack of political will being shown by the EU Member States to avoid another tragedy in the Balkans.

Posselt
Mr President, I am not pleading for border changes either. I would like to make it quite clear that much of what has been said here is historically and legally incorrect. If what Mr Ephremedis has said were true, then today the Ottoman Crescent would still be fluttering over the Acropolis. We must be quite clear that there have always been changes, throughout history, and that under current international law peaceful changes are quite permissible. In 1878, exactly 120 years ago, in Prizrem in present day Kosovo the Albanians founded the Prizrem League in a bid to reassert themselves as the oldest civilized nation in Europe in the face of the crimes of the Ottoman Empire. At the Berlin Congress, which documented the failure of the Europe of the day, they were simply swept under the carpet. Their right of self determination and their very existence were ignored. They were not discovered again until the Balkan wars, when they became useful as pawns in a game of chess.
That is how the borders we are discussing today were fixed, and so Mr Cohn-Bendit is right. We must make sure that the regime in Serbia changes and that Mr Milosevic disappears, because it is impossible to persuade a family in which several members have been murdered to carry on living under the same roof as the murderer. It is a quite absurd idea and one which could only have taken shape in the mind of a politician or a bureaucrat. I must say this quite unequivocally. We must see things as they really are. People are being systematically murdered and expelled and it has been happening for eight years. The situation has indeed deteriorated now, but this campaign against the majority population in Kosovo has been going on for eight years.
If Mrs van Bladel keeps saying that our first priority must be to counter the resistance movement in Kosovo - and I myself am no supporter of violence either - I must remind her that having turned our backs on Mr Rugova and his peaceful resistance for many years it is now somewhat hypocritical of us to attack people who are simply trying to save their own lives.

President
I have to inform you that I have received six draft amendments, submitted pursuant to Rule 37 (2) of the Rules of Procedure.
The debate is closed.
The vote will take place at 12 noon tomorrow.

Posselt
Mr President, I would just like to ask whether it is now common practice in discussions with the Council for the Council merely to issue a prepared statement at the start, to continue to be present during the debate, which we welcome, but then to leave the Chamber without making a further statement, or any further involvement in the debate? It is completely pointless!

President
Mr Posselt, you know as well as I do that it is for the Council to decide whether or not it wishes to speak at the end of a debate. If the Council shows no inclination to speak, we can only note that fact.

In vitro diagnosis
President
The next item is the recommendation for second reading (A4-0225/98), on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the common position established by the Council with a view to the adoption of a European Parliament and Council Directive on in vitro diagnostic medical devices (C4-0178/98-95/0013(COD)) (Rapporteur: Mr Pompidou).

Giansily
Mr President, as you know, the Conference of Presidents changed today's agenda, and Mr Pompidou's report should have been this morning.
He had agreed to chair the board of examiners for a thesis student and unfortunately he could not leave the candidate in the lurch. This is why I am replacing him and I will repeat what he would have said if he had been present.
In vitro diagnostic medical devices are taken to mean reagents, instruments and equipment for the examination, for medical purposes, of tissues or substances from the human body.
Unlike medicines, in vitro diagnostic tests are used outside the human body in order to allow medical tests to be carried out on samples taken from patients. Such devices are thus essential tools for the diagnosis of illnesses, the monitoring of treatment and now even research into the predisposition to certain genetic disorders, thanks to the recent development of genetic tests.
These devices are mainly used by pharmaceutical laboratories, doctors and specialist pathologists. However a growing number of these devices are intended for use by patients themselves - for example, measurement of blood sugar levels in diabetes and for pregnancy testing.
In such a context, any diagnostic error would have serious consequences for the health and treatment of patients. You will easily understand this as it relates especially to diagnosis of the AIDS virus and hepatitis.
The common position thus lays down the essential requirements which the devices must satisfy to be able to be placed on the market and the conformity assessment procedures to be applied by the manufacturers.
The Council has taken up most of the amendments tabled by Parliament at first reading. Thus the common position seeks to establish a balance between the aims of freedom of movement and protection of human health. In fact it enables monitoring and follow-up of the quality of products, based on reacto-vigilance measures.
It would nevertheless be worth clarifying a few points, namely those which are the object of the six amendments, especially the more general ones. Amendment No 2 insists on the need to draw up - as quickly as possible - the legislation that is lacking on medical devices manufactured from substances of human origin, which are currently not covered by the scope of the directive. Amendment No 3 aims at avoiding any distortion in competition which may be caused by certain Member States' own regulations with regard to devices for self-testing. Amendment No 4 ensures that instructions for these same self-testing devices will be translated into the language of the final user. Outside the laboratory the patient must be able to understand the instructions easily in order to avoid all possible error in the use of the test. Amendment Nos 1 and 5 enable the quality and safety of two types of new test to be taken into consideration. Amendment No 5 relates to the diagnostic device enabling the risk of trisomy 21 in the first few weeks of pregnancy to be assessed, whilst being aware of the fact that it relates only to an assessment of the risk which will then require further screening methods, carried out with the well-informed consent of the parents-to-be. Amendment No 1 covers genetic tests, in particular the use of high-density DNA micro-chips, which are the components of genes. These devices enable genetic diseases, and a genetic predisposition to certain diseases, to be very rapidly and reliably identified.
Given these conditions, our rapporteur Mr Pompidou fully subscribes to Amendment No 6, proposed by the Green Group in the European Parliament. Based on the Council of Europe's Convention on Bioethics, this amendment aims to avoid any discrimination on the basis of genetic tests. He will thus propose an oral amendment at the time of the vote tomorrow, which adopts the precise words of the Council of Europe's Convention.
Progress in diagnostic methods leads us today to take precautions regarding the quality and reliability of tests, but also to avoid any improper use which could endanger human dignity. This is the aim achieved by the common position and sought by the rapporteur's amendments.

Gebhardt
Mr President, ladies and gentlemen, at the suggestion of the European Parliament the Council has made a whole range of important improvements to the original European Commission text. This is very welcome, for this is a very important matter.
However, there are two points I would like to raise which my group believes to be of particular importance and which are still missing from the text, although we introduced them at the first reading.
The first, Commissioner, relates to an ongoing dispute with you, and that is the issue of labelling in the broadest sense of the term. It is imperative that the instructions for medical products to be used by individual members of the public be translated into the languages of the various Member States in which the products are to be marketed. This is absolutely imperative since these products have to be used in a very precise way. Faulty diagnoses which might result from incorrect use must be prevented at all costs, so it is vital that all possible sources of error are eliminated. And this naturally includes making sure that the public can read, in their own language, the instructions on how to use these products and the consequences of using them incorrectly.
The second point I would like to raise here is, in fact, the last point which was discussed in the presence of Mr Pompidou. In vitro diagnostics use very special materials, tissues, cells and other substances of human origin. The nature of this material obviously requires that it be handled with particular care and particular precautions. I am delighted that this option is available. The amendment tabled by the Greens will provide a guarantee of data protection and guard against the type of discrimination which might result from knowledge which could be gained from these diagnostic methods and tests, in terms of the fundamental genetic characteristics and predispositions of the individuals involved. For this reason it is very important indeed for us to make this improvement in this area.

Rübig
Mr President, ladies and gentlemen, in the current phase of European integration, and particularly now with the Cardiff summit, the talk is once again of much greater subsidiarity. Subsidiarity means, for example, that general economic conditions should primarily be regulated by individual Member States. It also means, of course, that although these arrangements are not standardized, they must be mutually recognized by all parties involved. For if this were not the case, our most important goal, the single market, would quite simply not function. To this extent, the principle of complete technical harmonization which formed the basis for the corresponding 1985 directive is now obsolete. This is something which Mr Donnelly from the Socialist Group emphasized quite specifically in the Committee on Economic and Monetary Affairs and Industrial Policy.
In terms of technical legislation, the "new approach' is gaining considerable ground. All it means is subsidiarity. The single market should not be hampered, but it should not be over-regulated either. However, if it proves impossible for a matter to be regulated or to be regulated adequately at Member State level, then we must proceed jointly to regulate in a uniform way at least the essential elements, only the essential elements in fact, at European level. In vitro diagnostics is one such matter.
This draft directive represents a further step towards the completion of the single market, in particular for medical products. But it is proving to be an area fraught with tensions. On the one hand, we must allow producers free access to the European domestic market, but on the other we have to take into account health protection, particularly with regard to the use of these medical tests by individuals. Nevertheless, this must not be allowed to become a pretext for setting up market barriers and anticompetitive measures.
During the very lengthy period it took to formulate this common position in the Council, we had to acknowledge that there was an increasing trend in some Member States towards excluding in vitro diagnostics from the single market. In our view, that is the main reason for adopting this directive, and thereby creating a single market for these medical products, as quickly as possible.
We know that the manufacturers are waiting eagerly for free access to the market. For this reason it is important that the amendments which have been submitted are also accepted by the Council and that the directive should be formally ratified, perhaps even before the summer recess. The Council has already accommodated us on several points. At any rate 36 of the 50 amendments submitted following the first reading have been accepted. Nevertheless, we would like to stress that there is still room for improvement in the basic approach. For this reason I, too, submitted several amendments to the Committee on Economic and Monetary Affairs and Industrial Policy, designed to dismantle the bureaucratic devices which are so costly to business. The most important thing is that statistical requirements should not become preconditions for the introduction of the products themselves. But this addition in Article 10 (2) must also apply in a consistent and logical manner to the provisions of Article 21 (2). What we are dealing with here, however, is a fundamental phenomenon. Discussions on disputed single market guidelines often last a very long time. When the matter comes before Parliament, therefore, we often have to reach our decisions very quickly if we want to make the internal market a reality for the citizens of Europe. This should also be taken into account in any future reform of the Treaty.

de Rose
Mr President, ladies and gentlemen, in his recommendation for second reading, Mr Pompidou proposes that we give an opinion on six amendments, amendments which, I would remind you, were adopted virtually unanimously by the members of the Committee on Economic and Monetary Affairs and Industrial Policy on 3 June.
The measures, which consist mainly of providing specific rules for in vitro diagnostic medical devices, in other words the examination, for medical purposes, of tissues or substances from the human body should, I feel, attract broad approval. Whilst the Commission's directive seemed extremely technical, we must applaud the rapporteur who has tried hard, on the one hand, to use common sense - a rare quality - and on the other to protect human dignity in an area of utmost importance, that of public health.
Having sought, and obtained, a wide consensus at first reading, Mr Pompidou contents himself with amending a few details of the common position, with the aim of completing the process so that the directive can be implemented as quickly as possible and this is an aim which we share.
We thus support the six amendments proposed by the rapporteur, insofar as it seems to us necessary to notify the relevant authorities regarding the introduction of all new products onto the market as this thus enables some form of product monitoring, and also necessary to fight against pirating and copying of products or medical procedures, thus giving a guarantee of quality and safety to the users. The need for rapid legislation in the area of medical devices manufactured utilizing products derived from human tissues or cells is clear if we want to avoid the risk of misuse.
With regard to the devices covered by Annex 2 and those designed for self-testing, the possibility for Member States to ask to be informed of the data allowing identification and directions for use should not be a prior condition for a product to be put on the market and/or put into service. This would cause a doubling up of work and would mean an administrative overload with regard to the decision to conform to the directive.
It would seem to us wise to leave the decision regarding the translation of instructions to the Member States, except with regard to self-testing. Although testing is generally the role of doctors, in view of the development of self-testing, it is appropriate to ensure that care is taken by requiring that all users can read the instructions in their own language so that they clearly understand what they are doing, aware that any error could prove to be catastrophic. In view of the tragedy a baby carrying the trisomy 21 gene represents, it is appropriate to add to the Annex 2 list the procedures enabling the detection of all risk of this illness.
In conclusion, Mr Pompidou's approach, which consisted in seeking a balance between the objectives of freedom of movement and those of the protection of public health seems to us well-founded and impeccably implemented, which encourages us to give him our unreserved support.

Amadeo
Mr President, this report has followed a rather arduous course, but it has at long last reached the final straight, thanks amongst other things to the determination of the rapporteur. The European Parliament introduced a series of amendments to the initial proposal to specify the rules for in vitro diagnostic medical devices to allow their marketing; in the past these devices were excluded. In Italy, in particular, we have problems with HIV, HAA, and HCV, which are the markers of hepatitis and AIDS.
In the common position, the Council took on board nearly all of our amendments, which is why we can say that we are partially satisfied. Now we must rapidly conclude the legislative procedure, because the use of these devices is essential in diagnosing diseases and the predisposition to certain genetic disorders, and in evaluating the patient's state of health. This equipment is, therefore, very important in avoiding diagnostic errors and in putting into effect the health protection programme in the sector of in vitro diagnostic devices.

Trakatellis
Madam President, the vastly important contribution of medical devices to the quality of public health service provision has been acknowledged here. Nevertheless, in order to demonstrate the importance of such devices, I would like to mention, for example, the devices we use in blood groups and blood sub-groups for transfusions, the control of drug compatibility, the contribution of laboratory diagnosis, such as for AIDS and hepatitis. With very few exceptions, there is no system of controls and regulations in the Member States of the European Union. As a result, the directive we are debating covers this field and will without doubt contribute to the needs of those industries which produce these devices.
To start with, the proposal was considered constructive, not only as it would have been useful for the reasons I have mentioned, but also as it contained many elements which would have contributed to a better qualitative control of in vitro diagnostic devices. There were weaknesses in the directive which have been significantly improved in the common position both through Mr Pompidou's amendments and through my own amendments and those of others. Today there have been other amendments which make it even better.
Firstly, some ill-defined aspects of the Directive have been clarified, as has its relation to other related directives. Next, the devices of human origin which are used in in-vitro diagnostic methods have been clearly defined, and the number of reagents which are classed under Annex 2 has increased, given that the reagents in this Annex are subject to considerable control. Moreover, special importance has been attached to reagents used in the home, given that their users are not people with special knowledge and that instruction must therefore be clear and in the user's mother tongue. Finally, safety regulations concerning diagnostic devices have become more stringent, as regards both their preparation and use, in order to safeguard the user against various dangers and against certain reagents. I foresee that this field will increase significantly in the future. That is why this Directive is of benefit both to the industries that produce the devices and to users, who will be able to use them with confidence.

Bangemann
Madam President, we would have liked to be able to express our thanks to Mr Pompidou in person because working with him was not only a very pleasant, but also a very productive experience, considering the outcome. But for understandable reasons he cannot be present today. With an eye on the previous debate, I would wish that Parliament, which in fact laid the foundation stone which prevented Mr Pompidou from presenting this report himself, would sometimes show a little more understanding for members of the Commission who are also subject to these parliamentary vagaries without having a hand in them. But that is simply a remark which I make with complete confidence in the wisdom of those who set the agenda.
We have a directive in front of us - and I should like to say this to Mr Rübig to prevent any misunderstanding - which sets out the minimum standards that all parties really must adhere to. This is not, in essence, the old approach of harmonization but, if you like, the new approach whereby Community legislation is used to lay down minimum requirements after which, in the course of reciprocal recognition, other issues can also play a role. It is, however, absolutely necessary because, we quite clearly cannot work on reciprocal recognition until at least the general rules for the Community have been laid down.
But there is still a long way to go in defining subsidiarity. The Commission was particularly pleased that in the Council discussions at the Cardiff summit we were able to point to several issues where we believe subsidiarity would have produced a different outcome. For example, we believe, in contrast to Parliament and the Council, that conditions for animals in zoos should be regulated at national level. It is not a matter which calls for European regulation. However, subsidiarity allows of some splendid arguments.
The future directive on in vitro diagnostics, however, will both guarantee the safety and reliability of these products in relation to their application in medicine and strengthen the single market through the standardized requirements which it stipulates. We welcome the fact that - having already accepted a whole range of amendments submitted by Parliament at first reading which improved the text - we are now also able to accept all the amendments suggested now - although some will still probably have to be improved orally. These amendments contain clarifications and additions to the directive which are very welcome.
In applying the directive we must bear in mind the pace of technological development. In any case, we will start by setting out a series of framework conditions within which the industry can work. But it is impossible to rule out the possibility that we might have to revisit the matter. Therefore, in implementing the directive, the monitoring of the market by the Member States will have a very important role to play. We hope that the setting up of a European database, which also springs from a suggestion made by Parliament, will contribute towards this. In any case, we shall make every effort, in conjunction with the Member States, to set up this database before the directive comes into force.
Rather than going into all the amendments in detail, I should like to mention one in particular, namely Amendment No 2, which illustrates particularly well how the manufacture of medical products using substances of human origin has to be harmonized at community level.
Naturally, like Parliament, we hope - and according to the information we have, we are almost certain - to be able to convince the Council as soon as possible that these latest amendments are justified, so that we can then complete the legislative process as quickly as possible. I say this because the implementation of these directives is not only in the interests of the single market, but, first and foremost, in the interests of health protection.

President
Many thanks, Commissioner Bangemann.
The debate is closed.
The vote will take place tomorrow at 12.00 noon.

Harmful tax competition
President
The next item is the report (A4-0228/98) by Mr Secchi, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the communication from the Commission 'A package to tackle harmful tax competition in the European Union' (COM(97)0564 - C4-0333/98).

Secchi
Madam President, Commissioner, ladies and gentlemen, my job is to illustrate a proposal for a resolution on the topic that has been stated, that is, a package of measures aimed at fighting harmful tax competition, a package that has been approved by a large majority of our Parliament's Committee on Economic and Monetary Affairs and Industrial Policy. This committee was able - due, amongst other things, to the work that has been going on for a long time now - to find a solid basis of common ground with regard to the major principles of the new approach that the Commission has proposed in the matter. This has also been possible because of the opportunity that we have had to be in constant touch with Commissioner Monti, and the opportunity of being so involved in defining an extremely delicate matter as it progresses. Indeed this matter not only closely concerns economic entities but also all citizens and is increasingly gaining in importance as the full effects of Economic and Monetary Union are being felt.
Ladies and gentlemen, you will remember that about a year ago Parliament approved by an overwhelming majority the first resolution on the matter in which there was full endorsement of the idea of elaborating a code of conduct on various tax issues and in particular on the taxation of company profits, a code that has since been created and is already operational, as I will explain in a moment.
Since the proposal of the new approach two years ago by the informal Ecofin Council in Verona in April 1996, tremendous progress has been made. I think we can say that the problem has now been clearly brought into focus and that there is agreement on all the procedures that are being proposed to tackle the problem with any hope of success. Even the European Council in Cardiff that has just ended underlined these concepts in the spirit of encouraging the active continuation of work on the matter.
The package that we are dealing with in today's debate and in tomorrow's vote and that is the subject of this resolution was put together last year and presented to the Ecofin Council of 1 December which approved it and gave the green light for its implementation. Our committee - and not Parliament unfortunately, because of the limited time - has succeeded in giving a favourable opinion to endorse, encourage and support this package. Today, we are here to comment on its main content with reference first of all to the approach, to the philosophy followed and, secondly, to one of the three parts that comprise it, that is to say the code of conduct for the taxing of company business, a code that is already operational and that now has all that is needed to begin producing its initial effects. The other two provisions are the proposal for a directive to avoid double taxation on royalties paid between associated companies in various Member States, a proposal that is already being examined by our Committee on Economic and Monetary Affairs and Industrial Policy; finally, the passage of the third part of the package will begin, the draft directive on the taxation of savings or, better, on a common approach to the taxation of financial income paid to natural persons who do not reside in the various Member States.
The nature of these three provisions in itself illustrates one of the fundamental aspects of the new approach, which is that of following soft procedures - if I can use that term - adapted to each of the specific matters without claiming to have found the solution to all the problems by way of the harmonizing directives. Secondly, it is a coordinated approach whereby, through the package technique, it is possible to bring together various interests and find the necessary consensus. I think that we can but agree on this. It is one of the reasons why I am not in favour of the amendments that have been presented and that - apart from those that repeat concepts already contained in the report - have a certain tendency to harden the approach proposed, something that I do not consider appropriate at this stage.
I would now like to turn my attention to a fundamental aspect, that of always clearly making the distinction between harmful tax competition, which calls for Community-wide action in order to eliminate the effects that in the end are negative for everyone, and the opposite concept of positive tax competition which is beneficial and is stimulated by competition within the single market and monetary union, and that we could also say is an answer to the requirements of international competitiveness which the Union is having to face in the globalized economy.
This report concludes by giving support to the Commission and encouraging it to continue along the same line, taking on other issues that so far have not been tackled for very obvious reasons, like those listed in paragraph 7. I will conclude, Madam President, by pointing out to the Members of this House that paragraph 28 suffers from the fact that it was written before the draft directive on the taxation of savings was tabled. This proposal is at our disposal and, as I said, the Committee on Economic and Monetary Affairs and Industrial Policy will commit itself to proceed quickly with this.

Randzio-Plath
Madam President, Commissioner, the report presented by the rapporteur represents a real step forward, just as the package of measures put forward by the Commission has finally succeeded in stirring up the tax debate at European level. And it is timely, because the internal market will quite simply never be completed unless we put an end to harmful tax competition in the European Union and make further progress in the areas of tax alignment and tax coordination.
This must therefore be followed, with the start of economic and monetary union, by a real coordination of tax policies which goes beyond the narrow alignment of economic policies. And this package of measures represents a step in the right direction, as Mr Secchi has underlined in his important report.
In a world of globalized markets, the international competitiveness of locations is determined by their infrastructure and, therefore, also by their tax systems and tax scales. Corporate taxation, in particular, is increasingly becoming a factor in competition. There are certain Member States which are attracting inward investment through tax avoidance and tax exemption measures or tax reductions and thereby taking these resources from other EU Member Sates.
This constitutes anti-community tax competition in the form of tax dumping and is harmful to all the states in the European Union. There is a conflict of aims between the wish of Member States to protect their fiscal sovereignty and the wish to structure corporate and capital taxation in such a way that they are neutral rather than restrictive to competition. It is impossible to solve this problem by free competition and market forces alone. It is a fact that tax competition in the European Union is unfair, and that income tax payers are making an ever greater contribution to the tax revenue of Member States and mobile resources an ever smaller one. As the Commission has very rightly outlined, the burden on income tax payers has increased by roughly 10 %, while that on capital factors and corporate taxation has dropped by some 20 %. This change in the basis of taxation has made the performance of public functions considerably more onerous and could also lead to tax erosion.
The development is dramatic because in the long run no state can avoid the pressure to reduce taxes and this can benefit only the companies, not the countries involved. Thus, the community-wide coordination of tax policy, as suggested in the European Commission's package of measures and Mr Secchi's report, in the form of a code of conduct on taxes is a very proper aim and represents a step in the right direction. However, it is in no way binding and this is something we should be pushing for.
At a time of European and international competition, the coordination of tax policy does not represent a loss of fiscal sovereignty for Member States, but rather a gain in sovereignty for both the European Union and its Members. It makes sense to define profits and the way in which tax assessment bases are structured jointly and to introduce a minimum level of taxation. Whatever happens, the tax oases in the European Union which currently allow transnational companies to transfer profits between countries in order to escape or reduce levels of taxation in their country of registration must be eliminated immediately.
As a result, I believe that we must place the tax code of conduct within the principles of free but fair competition. We must not allow a situation to develop in which direct contributions in general are banned, but where there is no limit on subsidies through tax regulations in the European Union. That is no longer acceptable. I believe that the package must be expanded to include further intensive measures designed to standardize regulations and tackle new tax regimes, and also to include a comprehensive and modern system for the exchange of information and checks between tax authorities in order to create barriers to tax evasion in the European Union.

Peijs
Mr President, the European Union has little to say about the taxes Member States impose on their citizens. Only Article 99 grants some power, but with three limitations. The article only applies to indirect taxes, the measures must serve the completion of the internal market, and the European Parliament has merely a consultative role.
I certainly understand the reticence of Member States to relinquish control in the sphere of taxation. Levying taxes is a very serious affair. Citizens or businesses have to hand over part of their income. Taxes can exert an upward effect on prices, which means that businesses have less money to invest and citizens have less money to spend. Of course, taxes are usually applied for the common good, for example, to finance public works or to discourage the consumption of certain items through excise duties.
My group favours less competition between countries as regards tax levels themselves, and to let them compete instead on what they achieve with the tax money. Business parks, housing conditions, infrastructure, education; countries make their own choices on how they allocate their money. But we should not have a situation, Mr President and Commissioner, where inefficient states dictate the level of taxation to efficient states.
My group can therefore appreciate, to some extent, the extremely limited progress in the sphere of tax harmonization, or as it is being called more modestly now, tax coordination, and the prevention of mutually harmful tax competition which might erode tax proceeds in the long run.
Yet I am also disappointed. Many years ago, the former Dutch Minister of Finance, Mr Ruding, wrote down his priorities for European tax harmonization, for VAT and duty harmonization. Apart from the minimum rates, none of these are anywhere near to being harmonized. The interests of all the countries, the interests between various countries, and the interests within individual countries have turned out to be too divergent. The time is right to take a step forward.
At the Cardiff Summit, broad guidelines were adopted to coordinate the economic policies of the Member States to ensure the success of the single currency. As a result of these guidelines and the euro, the Member States will become very conscious of their mutual dependency. Perhaps this will help to set the affair in motion.
Carlo Secchi's report is excellent; it is a coherent and well-structured piece of work. The approach opted for in the report offers the best chances for a step forward. There is no point in simply shouting loudly from the rooftops, or wanting to take steps that are too large. I hope that this combination of three routes, the code of conduct, the imminent tax on the savings of those living abroad, and the tax on interest and royalty payments, might lead to the Council reaching agreement more easily. I do hope that the brilliant discovery of a single package will not lead to the Member States holding each other to ransom. My fear is that one aspect or another will not get off the ground because the entire package could not be accepted.
Of course, quite a few dossiers remain open. The pension system dossier is the most important. The systems vary so much that we can expect great difficulties in this area during the next century. Commissioner, I hope that we, the European Parliament, can support the attempts to improve this situation.

Gasòliba i Böhm
Madam President, Commissioner, ladies and gentlemen, I want to express the support of the Group of the European Liberal Democrat and Reform Party for Mr Secchi's report which, once again, makes a very positive contribution to the analysis of fiscal affairs at EU level. We congratulate him most sincerely on his work. We also welcome the Commission's proposals, not just because of the work the Commission has done, but because of its tenacity in trying to restore balance to the fiscal situation, which is absolutely necessary in the context of the constitution of monetary union and the euro.
We have made progress in the commercial and economic field, with the European internal market. We have made a lot of progress in the monetary sphere, with monetary union and the euro. But we are not making any progress in the area of fiscal harmonization, as we need to do, because of a real obstacle: the fact that we need the Member States to be unanimous in order to reach agreement in this area.
Nevertheless, the Luxembourg conclusions and agreements and the Commission proposals are headed in the right direction. We think they are good proposals, which will serve to eliminate harmful unfair competition between Member States in fiscal matters, and to make suitable proposals, for example in the field of dual taxation or taxes on cross-border payments.
Nevertheless, I would like to conclude by repeating that there are still some very important aspects of fiscal harmonization which, unfortunately, have not yet been regulated and lead to an imbalance between these three areas: the economic, the monetary and the fiscal.

Gallagher
Madam President, at the outset I want to congratulate Mr Secchi on the presentation of his report.
Over the years there has been much talk of the need to achieve better coordination of national taxation policies. Let us not be trapped by the illusion of grand taxation schemes which, in fact, could undermine the competitiveness of my country and send hard-won jobs out of the country.
Let me immediately say how appalled I am by Amendment No 5 by the Greens, which I reject out of hand. It calls for further action to be taken to establish a European-wide minimum rate of corporation tax. This is a backdoor way to increase taxes on business. It would undermine the whole Irish economy. It would send out the wrong signals to investors.
As regards the code of conduct and business taxation, I want to underline the point that its purpose is not to harmonize business taxation but to deal with special tax schemes which are considered to be harmful in a Community context. Harmonizing business taxation has no place on any EU agenda. Such a position flies in the face of the principle of subsidiarity.
There are many factors which determine the location of a business. Some incentives are not transparent. Larger countries, for example, can attract investment through substantial grants or public procurement possibilities. My country has a very transparent tax regime. Other countries have high nominal rates and, on the other hand, they offer a low effective tax rate for business through special reliefs and allowances, some of which are not so transparent.
As part of the Commission's package on taxation a directive has been tabled which is aimed at eliminating withholding taxes on interest and royalty payments between associated companies and different Member States. This removes an impediment to cross-border business transactions. This is an objective which we can support. However, certain aspects of the directive could create difficulties which need to be examined and eliminated from the outset.
I should like to say as a representative from the peripheral area of the Union, from the northwest of Ireland, that we have great difficulties in attracting investment. That is understandable from a geographical point of view. But let no party in this House try to suggest that there should be no positive discrimination in any part. Authorities in my country - the Industrial Development Authority or Údarás na Gaeltachta, responsible for development in the Gaeltacht regions on the west coast of Ireland - have all tried over the years to attract investment. Any suggestion that there should be any tampering with our systems is very wrong.

Moreau
Madam President, taxation could be an important tool for the construction of a Europe based on growth and employment and could thus encourage the development of human abilities. Does fiscal coordination in the fight against unfair competition, as proposed by the Commission, enable Europe to respond to such a challenge? We know that tax dumping is already at work in the free movement of capital and tax havens. There is a serious risk of this worsening with the introduction of the single currency.
The Secchi report essentially tackles the issue of fiscal coordination from the point of view of the increased competitiveness of European financial markets. In fact, it is a question of harmonization from the bottom. For years, deductions on income from capital within the European Union have been endlessly reduced, whilst those affecting salaried income have increased, in particular through indirect taxation which, as we know, hits the lower paid hardest.
As representatives of our people, we should challenge the domination of the financial markets by advocating a tax system which is both fair and effective.
Firstly, balance must be restored between tax deductions on salaries and those on the holders of capital. Taxation of speculative movements of capital would enable better control of the financial markets and could provide an additional way of developing growth, training and employment. Furthermore, the European Parliament has already stated its agreement for such a measure. It could also encourage Member States to increase taxation on large fortunes, in order to finance effective actions to fight against exclusion. The financial burden must be lowered, especially for SMEs, through a credit policy favouring productive investment and jobs, rather than placing the burden increasingly on payroll taxes, which jeopardizes welfare systems. Social dumping must be combatted through taxation, the same goes for relocations and tax havens, which are a factor of unfair competition that must be brought to an end.
In conclusion, it is only possible to respond to the enormous challenges of the technology and information revolution with policies aimed at human development as opposed to a decline in social costs, and a fairer tax system could contribute to this.

Hautala
Madam President, our group supports the general ideas contained in Mr Secchi's report. He has been monitoring the harmonization of taxation for a long time now. As a Parliament we obviously have good cause to be somewhat impatient, as Member States still view taxation as if it were some diplomatic affair comparable to foreign policy. An example of this is that the meetings this high-level taxation group holds have an air of being top secret, and it is very hard to get any information on them, which is most certainly no longer the right attitude to take today.
It is quite obvious that with the advent of the euro such tax differentials between Member States will show up even more clearly, and tax competition will increase. My group would like to warn against the picture that is being painted that tax competition is a very positive thing. We see that it may, in some areas, be a useful tool, but we clearly wish it to be known that we want a minimum level of taxation in the EU, for example, for corporation tax. As for the ideas of the Member from the Union for Europe Group, Ireland may well still compete to some extent with a low rate of corporation tax, if it likes, but we above all want to create fair and equal conditions for competition. Otherwise, what Mrs Randzio-Plath said here today will happen: Member States will lose their tax base. How then will we be able to preserve this European model?

Blokland
Madam President, this debate confronts us with the wholly individual character of the European Union as a closely-knit framework of cooperation between independent Member States. The exclusive sovereignty on tax issues lies with the Member States, but this does not mean that they can do anything they like. The sovereignty of national states can never be absolute. At present, this sovereignty is being eroded by globalization. This is an important impetus towards coordination or harmonization of taxation at European level. The European Commission wants to compensate for the loss of national sovereignty by creating a joint sovereignty of the Member States.
Within the framework of the Commission's proposals, fair tax competition will continue to exist; there will, therefore, be no uniform tax rates. Taxation remains an exclusive power of the Member States. It is a mystery to me why the Commission is quoting the subsidiarity principle in point B of the Council's motion for a resolution. According to the Treaty and the Council 's Edinburgh declaration, this principle is out of place. Has the Commission overlooked this? I would like to hear Commissioner Monti's response to this.
High tax rates encourage harmful competition and tax evasion. For that reason alone, tax competition is not a bad thing. Due to high levels of public debt, or inefficiently organized governmental machinery, some Member States have condemned themselves to high tax rates. We cannot have a situation whereby the Member States who have their affairs properly arranged have to suffer for the indiscretions of others.
Tax competition becomes harmful when it encourages the market players to relocate their production activities purely to net a tax windfall. This type of competition is not only engaged in by Member States, but also -and perhaps especially- by regional and local authorities. In addition, harmful competition not only takes the shape of a reduction or an exemption. Businesses are sometimes exempted from legal provisions, so that special licences are granted, or environmental or noise standards are loosely applied. This aspect is left out of the motion for a resolution.
One positive point is the call to reduce tax on labour, and to shift to a tax on the environmentally damaging use of raw and auxiliary materials. It would be desirable if the European Member States started to compete with each other on the basis of who has the "greenest' tax system.

Angelilli
Mr President, I too would like to congratulate Mr Secchi. The introduction of the single currency certainly raises in no uncertain terms the problem of achieving tax coordination throughout Europe, seeking first of all to avoid harmful tax competition and also guaranteeing fair and equally distributed taxation with no favours. Like the euro, tax harmonization should be a valuable instrument at the service of economic growth and job creation. However, it is a delicate matter that demands adequate expertise and legislative clarity.
The important thing is to provide individual national administrations with the instruments with which to cooperate and share information and experience as provided for, moreover, in the FISCALIS programme. I would, however, like to emphasise that a genuine European tax policy cannot be limited to the passive role of fighting harmful tax competition. Our companies and our citizens are urgently calling for a reduction in the excessive burden created by too much taxation, taxation that is stifling household and corporate budgets, and actually jeopardizing the recovery of the European economy.
I will therefore conclude by saying that the working party that is preparing to set about its task should also set itself the objective of defining the instruments and strategies for a serious European policy of tax moderation, failing which, from our point of view, we will not have the means to rekindle development and there will be neither social justice nor economic democracy.

Fayot
Madam President, in my speech I would like to focus on the taxation of savings. In Europe it is the area in which there is the most hypocrisy. My country, Luxembourg, has often born the brunt of this. It has sometimes been described as a tax haven, when there are as many tax havens for non-residents as there are Member States in the European Union. For every Member State has endeavoured to develop its financial sector through different methods of taxation and regulations, especially with regard to non-residents. The financial sector is a thriving service sector which provides hundreds of thousands of high-level jobs in each one of our States. This needs to be taken into consideration in decisions at a European level. For many years, global solutions have been advocated here with regard to the taxation of savings, without considering their impact on the European financial sector. It is thus heartening to note that the attitude of the European Parliament in this report is becoming more qualified, more realistic and more pragmatic. It concludes for example, and I quote, "that the competitiveness of European financial markets must be protected at a world level' .
Unfortunately, Mr Secchi's report says nothing about how to achieve this. I think we are agreed on the development of a financial service sector which is free from tax or social dumping. The main thing is not to make a mess of the transition. If the tax measures taken lead to the flight of capital from Europe, we will be permanently weakened. The current negotiations show that it is not easy to put into practice the Ecofin Council's agreement of 1 December 1997, which was obtained under the Luxembourg Presidency. Thus the 20 % withholding tax on income from savings is clearly too high. But certain countries, which require sources of income, consider it too low. Personally, I think it would be favourable to set a minimum rate such as there is for VAT and leave the possibility of exceeding it to Member States, without thus forcing them into line with the euro.
I also wonder how the immense possibilities for financial engineering will be taken into account, which will easily develop a way of getting round European agreement via third countries which are not committed.
Similarly, Madam President, should true tax havens which come under the control of certain Member States be included in the European area? I am of the opinion that in a field which is so important for jobs and for the economy in general, and in particular investment, every detail must be sorted out and clarified before we can talk of moving on. If this is not the case, there will be no unanimity within the Council, nor a large majority in the European Parliament.

von Wogau
Madam President, ladies and gentlemen, with the introduction of the euro the completion of the European single market is coming ever closer. In some important areas we are, however, still faced with major and difficult tasks. Tax policy is one of these areas. Increased coordination of tax policy at European level is urgently required if market distortions, double taxation and other similar phenomena are to be avoided and the four basic freedoms of the common market are genuinely to be guaranteed.
I am not talking about complete harmonization. On the contrary, competition between national taxation systems remains necessary. But this competition must offer individuals state services under favourable conditions because by opening up markets and implementing freedom of movement, we have created competition between systems and this very competition will become a significant part of the tax system.
But, at the same time, Mr Secchi in his excellent report speaks of a "beneficial' degree of competition which we have to accept in order to guarantee competitiveness. This I fully support. The package of measures proposed by the Commission is a step in the right direction. I should particularly like to congratulate Commissioner Monti on the progress he has made over recent years. With the code of conduct for corporate taxation and the other two elements of the package dealing with capital earnings and taxes and licence fees between companies, he has achieved the first, important advances in taxation policy. Other areas must now follow. And here I particularly have in mind value added tax. The transition to the country of origin principle should be completed as quickly as possible. The current system, specifically designated a transitional system, is a burden on all companies trading across national borders and in particular on small and medium-sized businesses which are very important in terms of employment.
We should also look more closely at the possibility of halving tax rates for labour intensive goods and services. At the moment, labour is overtaxed in relation to its much more mobile counterpart, capital. This has obvious consequences for the labour market. But we must also examine carefully how this area, focused on manual work, can be defined and delimited. Our task is to close the gap between the high burden placed on the labour factor on one hand and the lower burden placed upon consumption, capital and energy on the other. I look forward to hearing some appropriate proposals from the Commission and hope that in this important area it will prove possible to achieve some concrete measures quickly.

Lindqvist
Madam President, there are four things I would like to say in this minute. The first is that tax policy is and should remain essentially a national concern. It should remain that way so that we do not construct a superstate or a federal state.
Secondly, the first thing you think of, and which the general public thinks of, is tax havens. I would like to stress that we must do something about them in order to have any credibility on the issue at all. It is simply harmful to the market.
Thirdly, not all tax competition is harmful. I would like to stress that there should be healthy competition between companies and countries. This is natural and simply promotes increased competitiveness and variety.
Fourthly, it is also quite natural and important for there to be differences in tax systems and rates which are based on social motives, such as the environment, health and consumer protection. And it is natural for these differences not to be regarded as harmful in tax competition.

Ribeiro
Madam President, the main concern of the Commission's proposed package of tax measures will be to deal with the imbalances in competition that may be caused by the different existing tax rules and regimes.
Mr Secchi's report takes a similar approach. In addition, the proposals put forward at this plenary emphasize the way we must go following the creation of the single currency, whose numerous advantages and universal benefits will only thus be revealed, namely tax reforms at community level. We ask that this process be accelerated and synchronized, if only so that the code of conduct for corporation taxation, which is part of the package and has already been approved by the Council, can be taken up with it.
Let us remember what some would apparently rather forget:
that the peculiarities of national tax systems arise from the peculiarities of national economies, which cannot be eliminated, despite all efforts to ignore them; -that tax harmonization, if supra-nationally imposed after the adoption of the euro, which now serves as a pretext and justification, would take away yet another instrument of sovereign and (democratic) government, especially as regards savings, from the national authorities; -that the inequalities of the weakest in terms of competitiveness may be seriously aggravated in the name of standardizing competition by means of tax reforms.The tax reform we are fighting for, at Community and national level, is a tax reform, or rather a series of tax reforms, that aims to create fairer tax collection systems with a reduction of the tax burden on working people, and not harmonized rules that lead to fresh and increased exemptions in favour of capital that already circulates too freely.

Wolf
Madam President, Commissioner, ladies and gentlemen, it is clear that there is a ghost creeping through this debate, the ghost of subsidiarity. It wears several guises: that of Mr Chirac, Mr Kohl, and more recently clearly that of Mr Gallagher. What is at stake is not providing a clear definition of subsidiarity as a necessary dimension of European integration, but rather using it as a pretext to develop the EU, within the framework of the WTO, as a deregulated community in the face of the single market and the euro, introducing a system of dumping in which we will all be losers. We all know that the only way out of this dilemma is to achieve common, reliable regulation. We must put a stop to tax erosion. And to do this we should take up and support the new convergence introduced by Mr Monti and, perhaps, as it has been increasingly watered down, give it back a little of its original shape.
We have submitted some amendments which head in this direction. I believe we must make quite clear exactly what the aim of the whole undertaking is. The aim of the undertaking is to complete the single market by creating the regulatory conditions for fair competition. Tax competition may be acceptable in terms of the quality, the good design and the proper application of taxation, but not in terms of rates of taxation.
Secondly, we should put an end to the disproportionate burden which, as Mr Monti has illustrated, is imposed on waged work, by shifting the burden to corporate capital and private assets on one hand and the environment and the consumption of resources on the other. This means we should ensure that capital and business start paying taxes on environmental impact and resources again and thereby create an important precondition for the transition to a sustainable development model.

Buffetaut
Madam President, Commissioner, Mr Secchi's report clearly highlights what some of us feared at the time of the Maastricht Treaty.
This is namely that, following the transfer of monetary sovereignty, the transfer of economic and fiscal sovereignty would be almost inevitable. Well here we are, we have arrived at the first step in that direction. In fact, the technique is always the same. We are given an assertion: the high level of tax competition has reached a clearly harmful level. It would have been good if this assertion had been supported by concrete examples. Then we are given another assertion: the Member States are slowly abandoning their fiscal sovereignty, thus the best way of finding that sovereignty once more is to abandon it completely to the European Union.
This being so, the real question to be raised is whether this tax competition between States within the European Union is desirable and good for the citizens of those States or, on the contrary, harmful. In reality, this tax competition may be perfectly healthy for both consumers and citizens.
The States which in the future will be successful in an open market, a market in which there is - and this is a good thing - freedom of movement of people, capital and industry will be those which ensure moderate taxation, flexibility in regulations and legal security. Thus this competition, far from being bad may, on the contrary, be extremely beneficial for individuals. It will create competitiveness between States and rather than creating some kind of gasworks - excuse me for this rather crude image - a harmonized tax gasworks, it is better to make the States compete with each other.
This being so, the idea of a code of conduct, especially for business taxation, is an excellent idea which should be adopted.

President
The debate is now suspended and will be continued after Question Time.

Question Time (Council)
President
The next item is questions to the Council (B4-0474/98).
Allow me to welcome the President-in-Office of the Council, Mr Henderson. I invite him to reply to Question No 1 by Alexandros Alavanos (H-0497/98)
Subject: Persecution of the Assyrian population by Turkey
On 14 May 1997 Turkish forces invading Iraq to persecute the Kurds passed through Iraqi Mesopotamia where a majority of the population is Assyrian and destroyed twenty Assyrian villages, killed scores of people and persecuted the population, forcing many of them to flee. Assyrians in Turkey are forbidden freely to express their political and religious views (they are Christians) and most of them are obliged to live in various European countries and in the USA.
Will the Council say whether it is aware of the invasion by Turkish forces of Assyrian regions in Iraq and what measures it intends to take to prevail upon Turkey to respect the basic human rights to which the Assyrian community is entitled?

Henderson
I am delighted that we will have our full 90 minutes today. Some of our previous sessions, for one reason or another to do with timetables, have sometimes been a little curtailed. But maybe in the spirit of the World Cup, we will have our full 90 minutes.
In response to Question No 1, the Council is aware that the Turkish armed forces launched a cross-border operation into northern Iraq in the spring of 1997. On 19 May the presidency issued a declaration on behalf of the European Union, noting with concern that fact and, inter alia, called on Turkey to exercise restraint, to respect human rights, not to endanger the lives of innocent civilians and to withdraw its military forces from the Iraqi territory as soon as possible.
The Council remains deeply concerned at the plight of the Assyrian people of south-east Turkey and northern Iraq. The proper protection of human rights remains an essential component in the development of relations between Turkey and the Union. The European Council meeting in Luxembourg on 12 and 13 December 1997 recalled, in line with the Council position expressed at the Association Council with Turkey on 29 April 1997, that strengthening Turkey's links with the European Union also depended on that country's pursuit of political and economic reforms, including the alignment of human rights standards and practices with those in force in the European Union, including protection of minorities.

Alavanos
I thank the President-in-Office of the Council for his reply, which was quite constructive. I am afraid, however, that it was a bit of officialese in that we are limiting ourselves to a reply which simply confirms past events. The issue here is that we have a minority which has deep cultural roots going even further back than Ancient Greek civilization. We are talking about the Assyrian people. These people, who have carried with them their language, their religion and their traditions, are few in number, and they are being displaced as refugees throughout Europe, in Sweden, in Greece and in other countries. I wished to ask whether, especially with regard to the Assyrian people, and especially with regard to the Assyrian minority both in Turkey and in Iraq, the Council will express its concern to the authorities of these countries and in particular to the authorities in Ankara. Especially with regard to the Assyrian minority.

Henderson
I am not sure that I have very much to add to what I have already said to Mr Alavanos. I understand that he has further outlined the plight of the particular populations that he refers to. I have already indicated the action of the Council in relation to these matters, and there is not much more I can add.

Sjöstedt
There is great ignorance about the fate of the Assyrian people compared with a number of other minority peoples. When people discuss the past, the Armenians are often mentioned, although historically the Assyrians were also subjected to heavy persecution in Turkey. When people discuss the present situation, the Kurds are often mentioned, although the Assyrian people are also extremely vulnerable. That is why special attention should be drawn to this to this particular population group in contacts with the Turkish regime.
I would like to ask the Council whether it has ever drawn attention to the Assyrian people. Has it ever drawn attention to this group when discussing these issues with Turkey? Are there any plans to draw attention to this group? The Assyrian people in Turkey today is more or less threatened with cultural obliteration.

Henderson
Again, there is not much more I can add. I am grateful to Mr Sjöstedt for drawing to our attention the plight of the Assyrian people he refers to, but I really cannot add anything further to my original response.

President
As the author is not present, Question No 2 lapses.
Question No 3 by Felipe Camisón Asensio (H-0499/98)
Subject: Measures to combat fraud in the sphere of excise duties
In the opinion of the Council, what measures should be taken to combat fraud in the field of excise duties, especially in the tobacco and alcohol sectors?

Henderson
The Council is aware that fraud in the tobacco and alcohol sectors has reached alarming proportions and results in very substantial revenue losses for the Member States and the Community. Ecofin considered how to combat this type of fraud at its meeting of 19 May and concluded that, subject to a Commission feasibility study, the long-term goal should be a computerized control system. In the interim an effective early warning system should be put in place so that customs authorities have better information about what goods are being moved.

Camisón Asensio
Mr President-in-Office of the Council, we have been told that the European Commission proposed some time ago to the Council that new measures should be adopted to combat fraud in the sphere of excise duties which, as the Council said, particularly affects tobacco and alcohol. We were also informed at the time that this is not a question of isolated cases - and the Council has confirmed that today - but of organized criminal networks. Furthermore, we know that the national authorities have the right to inspect goods being transported but, since they are not informed when they are being sent, they have difficulty in implementing effective control.
Our view is similar to that just expressed by the Council: that the ideal thing would be to set up a computerized system. But in the meantime, we think it would be a good idea to set up an early warning system, based on governments notifying one another. Would the Council be prepared to take this first step, before such time as we obtain the computerized system which would really be the best solution?

Henderson
Again there is not a great deal that I can add to my original answer. It is recognized by the Council that there is a problem and that there is a loss of revenue which results in large measure from crime related to the evasion of duties. Customs organizations throughout the Union will be taking what action they can in practical terms. As my original answer indicated, until such time as a computerized control system is set up it will be difficult to completely eliminate the abuses which are currently taking place. An early warning system will, we hope, help in the short term but if that was the solution then there would be no need for the long-term computerized way of tackling the problem. There is really no substitute for that in the view of those who are charged with finding technical responses to a political objective which we all share.

Miller
I wish to thank the Minister-in-Office and Mr Camison for recognizing the problems of fraud within the excise duties sector. I also recognize that in the short term, computerized records are not an immediate goal but obviously a long-term goal. The proper functioning of Europol has to be part of that goal as well in both the short and the long term.
I would like to ask the Minister-in-Office whether ultimately the way to tackle this problem is to look at the different excise duty rates in the different Member States and perhaps that should be the long-term goal of the Council of Ministers.

Henderson
I wish to say to the honourable Member that I understand the point he is making about the differences in excise duties which create an incentive for criminals to evade such duties. I am aware of cases in my own country where gangs are involved in bringing back goods bought in another country which they claim is for their own personal consumption but is in many cases for sale. This is one area where customs have been trying to catch up.
The question of common excise duties is a matter for Member States to consider. It is the responsibility of each Member State to decide the level of excise that it levies on any particular product range. Where there are issues of competition involved, it may be a matter for broader consideration but where it is a question of the regulation of excise duties on particular products, this is a matter for the Member States at present and I foresee no change in that.

President
Question No 4 by Susan Waddington (H-0502/98)
Subject: Employment Guidelines 1998 - women's employability
Given that the Employment Guidelines agreed at the special Luxembourg Employment Summit last December and the current Council presidency place great emphasis on developing women's employability, what specific measures are being taken by the Member States to increase women's participation in the labour market and encourage lifelong learning, whilst at the same time reconciling these activities with family life?

Henderson
The measures being taken by each Member State are set out in the national employment action plans. As Members of this House may know, they include: improved child care provision, extension of parental leave, strengthened training opportunities and targeted help to get lone parents back into work. Members may also be aware, and when they read the Cardiff conclusions they should then be fully aware, that employment was an important topic of discussion at Cardiff and it was agreed that action to mainstream equal opportunities in employment policy should be our priority in future.

Waddington
I thank the President-in-Office for his concise and clear answer. I understand that in some of the national action plans that were presented this year equality of opportunity for women was given a lower priority than the other three pillars. I wonder if the President-in-Office believes that the Cardiff Summit will enable women's employability and women's employment to gain a higher priority in future years.

Henderson
I thank the honourable Member for her supplementary question. I can reassure her that in the discussions at Cardiff and the conclusions which arose out of the discussions, the matter to which she refers - employability of women -was given the highest priority. There are clearly a number of high priorities in relation to unemployment and I hope that Members would understand that, given the high levels of unemployment that pertain in virtually all of the European Union countries and the need to tackle that problem of unemployment. One of the ways is to give a particular incentive and pressure to the various Member States to take measures which will raise the employability of women. That will give women greater opportunity to move into jobs which previously may have been closed to them for all sorts of reasons.
In general terms if one is serious about 'welfare to work' which has also become an increasing priority of all of the Member States of the Union, as reflected in the conclusions in Section 1 of the Cardiff report in relation to economic reform, it has to be recognised that an important sector of the Community who are currently excluded from work are young women. Helping to tackle the problem of youth unemployment necessarily involves tackling the problem of unemployment among young women. That is a priority in the conclusions and I am confident that the Member States will take on board their obligations to take action to assist schemes to raise the employability of women and thereby provide more equal opportunity.

Lindqvist
I am also concerned with these issues. Mrs Waddington and I sit on the same committee. I would like to ask a more general question in connection with employment for women. It concerns the following: are you, as a representative of the Council, generally positive about developments in the area of employment since the Luxembourg Summit and up to the current summit in Cardiff? Do you think that so far the decisions taken in Luxembourg, the general decisions, and the national action plans have satisfied the demands for improvements which we had the right to make?

Henderson
I believe that the important thing is to get job creation into context. Apart from where the state provides direct employment, the state cannot directly generate jobs. Companies generate jobs, people generate jobs. What the state has to do is create the climate - excluding areas of direct employment - where employability within the Community is enhanced. I believe that the key measure is to raise the education standards of our peoples within the European Union and to raise their training standards so that they are better able to take on the global challenges which every company trying to export beyond the European Union faces. Most companies within the European Union seek to export beyond that area.
Therefore the importance of the conclusions at Luxembourg and at Cardiff is to nurture the development of the right state policies, first of all deciding what can best be decided at European level and what can best be left, through subsidiarity, to action at national level or even below national level. That in itself is a very important decision that must be taken.
But then, to impose an obligation on all the Member States - and that is what the Cardiff Conclusion does - to take action which is consistent with the thrust of the proposals which originated in Luxembourg, to tackle the various issues of youth unemployment, middle-age male unemployment, equal opportunities for men and women and stimulating entrepreneurship - these are all challenges. Each Member State within the Union is required under the Cardiff conclusions to come back in six months and show what it has done on those issues.
If they are wise then they will understand the context of my introductory comments; that, apart from direct employment, where the state is employing people directly, one has to understand that the state cannot require the manufacturing or service industry to take on more workpeople. That is something that they must decide they need to do because there is a demand for their product or service and they have people who are capable of meeting that demand. That is where the need for training and education is so crucial, so that there are products that will be world-leading products arising out of the economy of the European Union which is based on high education standards and good training. That means that there will be more permanent employment creation effects.
It is in that context that one must view the conclusions from Cardiff.

President
Question No 5 by Aline Pailler, which has been taken over by Sylviane Ainardi (H-0503/98/rev. 1)
Subject: Implementation of the Euro-Mediterranean agreement between the EU and Tunisia
On 2 March the EU presidency welcomed the entry into force of the Euro-Mediterranean Agreement establishing an Association with the Republic of Tunisia, Article 2 of which lays down that "relations between the Parties...... shall be based on respect for human rights and democratic principles' .
Despite the fact that the Government of Tunisia has signed that clause, there has been no halt to human rights violations in that country. Charges have been brought against Ms Nasraoui, a member of the Tunisian Bar Council; Mr Ksila, Vice-President of the Human Rights League, has been sentenced to three years' imprisonment; and many leaders of human rights associations are subjected to harassment, police surveillance, provocation and so forth.
What measures does the Council intend to take on the basis of Article 2 of the Association Agreement, to help put a stop to human rights violations in Tunisia?

Henderson
As stated by the honourable Member who raised the question, the Council welcomes the entry into force of the Euromed Association Agreement. Tunisia was, in fact, the first Mediterranean country to sign such an agreement, establishing a political dialogue which allows both parties to discuss openly a range of political issues, including human rights.
The Council attaches great political importance to the promotion of respect for human rights in Tunisia and closely follows the evolution of the situation in that country.
The presidency will be working closely with the future Austrian presidency to prepare the first meeting of the European Union/Tunisia Association Council which will take place under the Austrian presidency. On this occasion the Council will raise the question of human rights and fundamental freedoms, reminding the Tunisian interlocutors of their human rights responsibilities and undertakings in the framework of both the EC/Tunisia Agreement and the Barcelona process.

Ainardi
Mr President, since the resolution which was adopted on 22 May 1996, we have indeed noted an improvement in the human rights situation in Tunisia, with the release of Mr Mouada and Mr Chammari. But as my colleague Aline Pailler underlines, the situation has once again deteriorated, with the sentencing of the Vice-President of the Human Rights League, Mr Ksila, to three years' imprisonment.
My question is thus the following: what can be done to guarantee the application of article 2 of the Association Agreement, because making reference to it is not enough.

Henderson
I am grateful to the honourable Member for taking up the question. One of the key matters that will be discussed at any Association Council meeting would be the question of human rights and the need to uphold the highest standards. That, in a sense, would be an essential part of the agenda of any meeting before other matters could proceed.
But the specific point that the honourable Member raised was referred to by my colleague, Mr Fatchett, who is another Foreign Office Minister in the United Kingdom, when he visited Tunisia. I think that was in a presidential capacity - or it may have been in the run-up to the presidency. He made that very point on behalf of the Council.

von Habsburg
Does the President-in-Office share my opinion that of all the Arab countries Tunisia is the most democratic - relatively speaking, of course - and that since it is wedged between Algeria on the one side and Libya on the other, we should take a special view of the situation of a country which is, furthermore, very much threatened by Islamic extremism and by other extremist movements? Would he agree that in this connection it has done a remarkable job in keeping relative freedom for the people and in trying to save the country, so that, rather than giving them too much advice, we should encourage them in the right direction and not give them the feeling that we are criticizing them?

Henderson
I thank Mr von Habsburg for his supplementary question. I have much sympathy with him, and others, in our discussions in this forum. However, it would be very wrong of me to act as some kind of jury and make assessments as to which of the countries which could be described as Arab countries - although I am not sure that definition would be too easy to make - was most democratic. What would be right for me, the Council and, I hope, Parliament, is to encourage all countries to build democracy and to guarantee human rights. In all our dealings with third parties in the European Union, that should be a high priority and we should continue to pursue that. Where we recognize that there have been big improvements, then we should say that, arising partly out of the discussions and the dialogue we have had, there have been improvements and that has led to a better life for a lot of people in certain countries.

President
Question No 6 by Mark Watts (H-0504/98)
Subject: Failure of Member States to transpose EU transport directives
The Council will be aware that a significant proportion of EU Directives have not been transposed by Member States. For example, in the transport sector, most Directives have not been transposed. What action does the Council propose taking to speed up transposition and complete the single market in sectors such as transport?

Henderson
The Council has made a commitment to transposing all overdue single-market directives in all sectors by the end of this year. Each Member State has submitted timetables to the Commission showing how this will be done, with progress monitored through the single market scoreboard. As a result, the number of overdue directives has halved in the past year.

Watts
I thank the President-in-Office for what is clearly good news for the European Union. And that is that, under the UK presidency and, indeed, the preceding presidency and no doubt the one that will follow it, we are making real progress towards completing the single market by ensuring that all Member States who have signed up to European laws comply with them.
I would ask the President-in-Office whether he can confirm that, if Member States do not honour the undertakings that have been secured, he will continue the practice of naming and shaming those Member States that do not comply with the laws they have freely adopted.
I thank him for the progress we have made but I believe we need to keep the pressure on so that the remaining half of untransposed legislative acts are brought into Community law at Member State level within the year, as all the Member States have undertaken. I am sure all of us will be encouraged but we all want to see the pressure continue.

Henderson
I can say to the honourable Member that I am grateful for his question and the opportunity to raise this very important issue. I can assure him that the Council is not going to act like some candid camera running round Europe seeking to expose breaches of commitments.
To the question as to whether countries responsible for breaches will be publicly named and shamed by the Council, the answer is No. Where the Commission has collated the information and placed it on the scoreboard, the information will name and shame. It has been done with this purpose, so that we can try to speed up the process of achieving a more effective single market.

President
Question No 7 by Freddy Blak (H-0508/98)
Subject: Council of Ministers as a showcase for lobbyists
The display of a luxury Jaguar in the entrance hall of the Justus Lipsius building in May was reprehensible. It purported to be a general advertisement for the British presidency and the Coventry area, but in reality it was a commercial advertisement for a car firm.
The matter becomes even more serious with the Open Day arrangement on 9 May. Is the presidency aware what signals the transformation of the Council of Ministers into a bazaar sends to the public? The whole affair shows the European institutions in a bad light.
Lastly, which other lobbyists have been allowed to exhibit in the Council of Ministers, and how much does it cost to use Council buildings as a showcase? Mr Henderson, I invite you to reply to Mr Blak's concerns about that Jaguar.

Henderson
It is normal practice, as Members of this House will recognize, for Council presidencies to mount an exhibition of a cultural, social or historical nature in the conference part of the Justus Lipsius building. The exhibition staged by this presidency was supplemented for a period of two weeks by an exhibition on the history, culture and social and community profile of Coventry. This was timed to coincide with COREPER's visit to that city.
The Jaguar car was part of this exhibition, symbolizing the importance that motor vehicle manufacture has played in Coventry. There was no advertising and no information about the car, its price or where to buy one. The car was there to give the exhibition popular appeal and succeeded admirably. I am sure all honourable Members share my satisfaction at Jaguar's success in boosting employment in Coventry. In many ways that is what the exhibition was all about.
The Council building is reserved for the use of the Council and its members and no outside commercial interests have access to it or its facilities.

Blak
I must say, you have quite a sense of humour, Mr Henderson. If you can see sex appeal in a car, you definitely will not be pulling any birds. I must say your answer astonishes me. To my mind, it is wasteful to pay out £10, 000 to remove a window in order to get a car into a building, followed by another £10, 000 to get it out again. I find it obscene. It is downright wasteful of taxpayers' money. It is all very well advertising for Coventry, but as you are all well aware, Jaguar has been sold; the company is now under American ownership. I have to say we must be way off track if we are now starting to advertise for the USA. Mr Henderson, I think we need to exercise care to avoid a situation whereby we have to ask Jesus to come and cast the money-changers out of the temple. I think we need to stop these propaganda exercises. It is a disgrace and people are at a loss to understand it.

President
Thank you very much, Mr Blak. I was waiting for that last, biblical sentence in the interpretation. Now that Mr Freddy Blak's speech is complete, Mr Henderson, I invite you to reply. I should warn you that we cannot leave the Justus Lipsius building just yet, because Mr Ford wants to put a second question. You have the floor, to reply to Mr Blak first of all.

Henderson
I thank Mr Blak for his question. I have to say that he must have a more lateral-thinking mind than I do. I thought that the exhibition had popular appeal. If Mr Blak thinks that is sex appeal, he has a more inventive mind than I do and I commend him for it.
I believe it is important to demonstrate to the whole of the Union the lifestyle of our communities within the Union. Any attempt to explain life in the community of Coventry in the Midlands of England to the rest of the European Union and beyond without mentioning Jaguar would give a very false impression of the importance of Jaguar to that city and, indeed, to the motor car industry within the European Union. I believe that the Jaguar is a good product and that it is appropriate that Coventry - not the Council - should feel that was an integral part of their community and one that they would want to show to the rest of the world.
Generally relating to lobbying, a number of parliaments within the European Union have in recent times drawn up stricter rules on the role of lobbyists and lobbying, how it should take place and in what circumstances it should take place, how it should be regulated, what relationship lobbyists, lobby companies and lobby organizations should have to Members of Parliaments and so on; and it may be that it would be appropriate for the European Parliament to give this matter further consideration. It is something which the Council would be wise to keep always under review, to see if any changes need to be introduced to current practices.

President
Thank you very much, Mr Henderson. As I warned you earlier, our thoughts are still on the Justus Lipsius building. More specifically, we are thinking about its interior, near that luxury Jaguar. Measuring the car's possible sex appeal does not form part of this Parliament's remit. However, to continue on this same subject, Mr Ford has the floor for one minute.

Ford
I appreciate Mr Blak's sense of humour. I am not sure whether everybody else does. We are both members of the Socialist Group. It was only a few months ago that we actually had racing cars outside the Socialist Group room and, as far as I recall, Mr Blak was not making a protest then. Obviously racing cars are okay - I think they are probably sexy. I do not know whether they have popular appeal, but clearly we need to sort out the plank in our own eye before we sort out the mote in the Council's eye. This is an area that we need to look at as there were complaints this morning about exhibitions currently going on in Parliament. Common standards are required and perhaps it is time for the European Parliament to take the lead.
We had a report on the control and registration of lobbyists which already seems to be ineffective, and the Rules Committee, of which I am a member, is doing a follow-up report on that to try to tighten up and strengthen the regulations. Maybe we can take the lead and the Council can learn something from us. I hope Mr Henderson can agree with that.

President
Mr Henderson, I am not sure whether to interpret Mr Ford's comment as a question to you or an argument with Mr Blak. However, if you wish to reply in any way, you have the floor.

Henderson
If the same question had been asked in the British Parliament, I am sure it would have tried to have established itself as a genuine question, whether it was or was not.
I am in agreement with the honourable Member that there is a need for a continual review of the lobby system, to take place from time to time as circumstances change, and I can assure him he would have my support for that.

President
Thank you very much, Mr Henderson. I am glad to see that the Council Presidency and the hemicycle are on the same wavelength, at least at the moment. We shall see if that continues to be the case with Question No 8 by Jaime Valdivielso de Cué, which has been taken over by Felipe Camisón Asensio (H-0512/98)
Subject: Aid to shipbuilding
Faced with the new moves to gradually eliminate aid to the shipbuilding industry, could the Council say what sort of criteria were used as a basis for withdrawing it and whether account has been taken of the importance of shipbuilding to certain regions of Europe in general and Spain in particular?

Henderson
The new rules on aid to shipbuilding, which were agreed with widespread support from Member States, including Spain, are designed to improve the competitiveness of the European Union shipbuilding industry. Whilst the new regime abolishes operating aid, it also refocuses remaining forms of support in order to promote the competitiveness of the industry. There will be new aid for innovation and the opening up of regional aid. A strict limit will be placed on restructuring aid, and strengthened monitoring provisions will be introduced.
We believe this is a very positive outcome for the future of the European Union shipbuilding industry. The new aid regime certainly takes account of the interests of all Community regions with shipbuilding interests. Spain stands to benefit particularly from the agreement to open up regional aid.

Camisón Asensio
First I want to thank the President-in-Office of the Council for the information he has provided in response to the question. But since the question placed special emphasis on the case of Spain - I do not know what data he has in that regard - I would be grateful if he could be a little more specific about the case of dockyards in the Basque Country.

President
Thank you very much, Mr Camisón Asensio. I shall invite Mr Henderson to reply. However, I am sure that if he does not have the information at this moment, you will receive it very shortly. Mr Henderson, you may reply but, in any case, I have told Mr Camisón Asensio that if you do not have the information at the moment, I am sure you will send it to him in writing very shortly.

Henderson
Mr President, I am very grateful to you for suggesting the answer to that question. I should like to endorse your comments. The purpose of changing the regulation is to allow more flexibility, to give each country a capacity to do what it thinks is necessary to restructure to help its industry and, of course, that applies to Spain.
If there are specific points which the honourable Member wishes to raise in relation to the shipbuilding industry - if he was referring to the shipbuilding industry in northern Spain - then I would be happy to answer them in writing.

President
Thank you very much, Mr Henderson. Having worked together for six months, Mr Henderson, it can come as no surprise to you that this Presidency, despite not being held by a member of the Labour Party, is pretty much in tune with your replies and can predict, to a certain extent, the problems you may experience at a given moment with such a specific question. So we need to be in tune to a certain extent, Mr Henderson. We have been working together for six months, and I hope we can do so again in the future.
So, along the same lines, I propose we now move on to Question No 9 by Nikolaos Papakyriazis (H-0514/98)
Subject: Desecration of a graveyard in Istanbul
On Wednesday, 1 April 1998, 51 graves in the Agios Eleftherios Greek Orthodox graveyard in Istanbul were desecrated. This was the worst act perpetrated in a Christian burial ground during the last decade. In recent months, the Greek Orthodox community in Istanbul has been the victim of a growing number of acts of provocation and aggression, while no official reaction has been forthcoming from the Turkish Government.
In view of developments concerning relations between the European Union and Turkey and in the framework of the contacts with the Turkish Government and negotiations regarding the Association Agreement, what steps will the Council take in response to this and what explanations, measures and guarantees will it seek to obtain from the Turkish Government regarding the protection of the Greek Orthodox community in Turkey and respect for its rights, given that acts such as those described above are inconceivable and unacceptable for the European Union?

Henderson
The Council regrets the developments concerning the Agios Eleftherios Greek Orthodox graveyard in Istanbul, and is well aware that under the Treaty of Lausanne signed in July 1923 the Turkish Government undertook to grant full protection to churches, synagogues, cemeteries and other religious establishments of nonMuslim minorities.
The European Council meeting in Luxembourg on 12 and 13 December 1997 recalled, in line with the Council position expressed at the Association Council with Turkey on 29 April 1997, that strengthening Turkey's links with the European Union also depended on that country's pursuit of political and economic reforms, including the alignment of human rights standards and practices with those in force in the European Union, which also encompasses religious minorities. The situation of democracy and human rights in Turkey remains high on the Council's agenda. The Commission's report to the Council in March 1998 on developments in relations with Turkey since the entry into force of the customs union, concluded on human rights that no substantial progress had been achieved as regards human rights and the democratic reform process in Turkey.
These issues are raised regularly with the Turkish authorities. Cooperation in the field of human rights and humanitarian issues formed part of the Commission's European strategy for Turkey of 4 March 1998.

Papakyriazis
I wish to express my thanks and my satisfaction to the President-in-Office of the Council for the clear answer he has given me on the matter of principle, which is of course the most important political issue.
This comment applies to the second part of his reply, but I am afraid that the first part, in which he attempts to give respond to my question on the specific unacceptable event which took place in Constantinople, is not an answer.
My question refers to the specific event which took place there, which should to be condemned, and to the explanations that have been demanded and to those that have given by the Turkish government. It also asks what measures, explanations and guarantees the Council is seeking in the context of the discussions it is holding with Turkey on the conclusion of relations between Turkey and the European Union.

Henderson
Desecration of a graveyard is unacceptable and outrageous conduct in any society, and that is as true in Turkey as it is anywhere else. We have urged the Turkish authorities to do all they can to bring those responsible for this action to justice. That is a matter which will be reviewed on an ongoing basis.

President
Question No 10 by Sören Wibe (H-0518/98)
Subject: Tax-free sales and international conventions
The Member States of the EU have signed international conventions stating that the sale of goods in international waters and international airspace shall be free of tax. No country has the right to impose taxation where journeys are effected between two countries.
Does the decision to end tax-free sales within the EU from 1999 not constitute a breach of those conventions? Must the conventions not be renegotiated by all the countries which are party to them?

Henderson
The decision to end intra-European Union duty on tax-free sales from June 1999 was taken by the Council in 1991 and I am not aware that this issue formed part of its deliberations at that time. However, the Commission has now produced a set of proposals on a duty-paid regime following abolition and Commission-chaired discussions are now under way at official level to work out the practical details of this regime. The honourable Member may wish to address his question to the Commission to ensure it is aware of the need to consider international conventions in these discussions.

Wibe
Should I interpret your reply, Mr Henderson, as meaning that the Council does not know whether the Member States have signed international conventions which they may possibly infringe when tax-free sales end?
It is, of course, reasonable for the Council to obtain information. I know that there were multilateral negotiations on which these decisions about international waters and international airspace are based. It is probable that these negotiations and the agreements which were then entered into also contain a clause about the circumstances in which individual states may cancel these agreements.
If the Council is unaware of this, I would like to advise the Council to try to obtain information on this point, as it is very important.

Henderson
I have seen the general outlines of the Commission report on this matter. If it is the view of the honourable Member - and I thank him for his question - that those proposals contravene obligations which have already been entered into by Member States, then I would urge him to submit his views to the Commission and seek its comments. When the Council considers this matter further, all these issues will be taken into account.

Watts
Given that only the Council can seek action from the Commission in this area, perhaps I could give an example of why there is a problem. Will the President-in-Office agree with me that ferries sailing from the east-coast ports of the United Kingdom to the continent through international waters will be able to sell goods on those ships at duty-free rates, even when the duty-free regime is abolished on 1 July 1999? Is that not the case and is it not the reason why my colleague Mr Wibe's point needs to be addressed at Council level? It is only the Council that can seek action from the Commission to ensure that the postduty-free regime is clear and transparent to the consumer and the enforcement agencies.

Henderson
I know that the honourable Member takes a deep interest in these matters, and if I represented his constituency I am sure I would as well. I also have an airport in my constituency so it is a matter of considerable interest to me back home.
The Commission proposals are not in line with what the honourable Member suggests. The Commission proposals require a duty-paid regime to be put in force on intra-EU traffic after 1999. As I have said to the other honourable Member, if there is a belief that the Commission proposals contravene Member States' other obligations, then I would urge the honourable Members to put their views or the views of their constituents to the Commission, so that the Commission may reassess their proposal. It would then be up to the Commission to come to the Council with an original proposal or an amended proposal. At this stage what we are really talking about are the facts of the case, and of any legal opinions that may flow from that. I think we want to get all that information on the table before any of us jump to conclusions.

President
Mr Gallagher, do you wish to put a supplementary on the same question? I am sorry I did not see you, and I invite you to take the floor.

Gallagher
I indicated to your officials at the initial stage that I had a supplementary. In view of the Commission's recognition that there would be a negative economic impact from the proposed abolition of duty-free within the EU and the fact that it has promised to present a working document to Ecofin clarifying the Community instruments available to Member States for addressing the consequences of abolition, could I ask the President-in-Office whether the Council agrees with the principle of using taxpayers, money to pay for the abolition of an industry which is currently self-financing and provides employment and economic benefits to regions around Europe? Could I also ask the President-in-Office if the matter was discussed at the Heads of State meeting in Cardiff? Does the view expressed outside that meeting by some of the Heads of State reflect the view of the presidency? In conclusion, could the President-in-Office indicate the number of jobs he believes will be lost as a result of the abolition of duty-free?

Henderson
I was not at the meeting of the Heads of Government in Cardiff, as the honourable Member will understand, but, as far as I am aware, that issue was not discussed. Certainly there are no conclusions which lead to any change in the situation. The matter was discussed fully at the Ecofin Council in May and the honourable Member is clearly aware of the conclusions of that Council meeting in May, as can be deduced from his question.
In response to the general issue, whether public money should be used in some instances to restructure industry, the answer is that in some circumstances that will be appropriate if, in the location, there is a qualification for structural fund aid or regional aid within a country. That would also apply in relation to any duty-free revenue loss. If there was a counter-proposal which on its own merit meant that it qualified for public money, then it would qualify. The whole purpose of the change in the regulation is to increase competitiveness, which should to lead to a gain overall for the public - if not in the immediate period ahead, then in the longer term.

President
Thank you very much, Mr Henderson.
Mr Gallagher, allow me respectfully to remind you that, in accordance with the way we apply our Rules of Procedure, requests for supplementary questions are made when the main question is announced. In other words, the request cannot be made in advance because that could obviously give some Members an advantage over others. So we have established, in accordance with our Rules of Procedure, that supplementary questions are accepted chronologically immediately following the announcement of the main question.
Question No 11 by Angela Billingham (H-0520/98)
Subject: The case of Els Pins Park, Moraira, Alicante
Over 13 years ago, two Spanish nationals committed a crime against fifty-four European citizens (non-Spanish) when they sold them property in Els Pins Park, knowing that there was a 63 million peseta loan on the whole property.
This case took the Spanish judiciary until 28 May 1996, 11 years later, to bring to trial. In 1996 one of the property developers was found guilty and the other did not receive any sentence. The owners put forward an appeal against the non-conviction of the property developer two years ago.
They have still received no final date for the appeal. Could the Council request information from the Spanish Government as to why this case took so long to be brought to trial and request notification of when the date for appeal will be set? Mr Henderson, I invite you to reply to Mrs Billingham's question.

Henderson
I thank the honourable Member for her question and recognize the difficulties those involved in the Els Pins Park dispute have faced over their properties, but I regret it is not for the Council to intervene in cases which are pending before national criminal courts.

Billingham
I am grateful for the reply, however negative it would appear to be. This is a really sorry saga. It has attracted the interest of Members from all sides of this Parliament. We have sought the intervention of the President of Parliament too. But I can tell you that even with your response matters have got even worse. When I asked the question it was about an appeal. We have now subsequently learnt that appeal has been heard. Nobody was notified of the appeal. None of the plaintiffs therefore attended. Nobody has any idea of the outcome of this appeal. Quite frankly, people are absolutely desperate. Already people have lost their property. Others are in the process of losing their property. It seems to me that we have an absolute impasse here. It seems to me that there is no procedure within Parliament, the Council, the Commission or whatever organization they are turning to that is able to offer them some help.
So I seek further acknowledgement of the problem.

Henderson
I thank the honourable Member for her further question. I acknowledge the seriousness of the situation in the way it affects those who are directly involved. Indeed I have had constituents who have been involved in difficult situations which are broadly similar. Ultimately they have had to seek legal redress.
As those matters are currently before the national criminal courts it would be inappropriate for me to comment further other than acknowledging that there is a serious problem.

President
Question No 12 by Paul Rübig (H-0521/98)
Subject: Cost of new customs legislation
As a former member of Parliament's committee of inquiry into fraud, I welcome any initiative aimed at making procedures more effective and more fraud-resistant. However, I am in favour of a rational and, above all, manageable realignment of EU customs legislation based on the requirements of SLIM and the assessment form. The other parties - customs services, trading partners, freight companies and banks and insurance houses - should also be involved as far as possible.
Can the Commission state what costs the new customs system will involve for the European economy? Mr Henderson, I invite you to reply to Mr Rübig's question.

Henderson
The Council obviously attaches great importance to the fight against fraud, and reducing customs fraud is one of the main objectives of current work on reform of the transit system.

Rübig
Mr President, the problem with the Commission's current proposal on customs law and transit is that it is, in reality, unworkable. We are approaching the enlargement of the EU. We want to trade with these countries and the system is currently structured as if all goods were sensitive goods like cigarettes, meat and alcohol. The fact is that normal trade accounts for 99 % of the total and the formal proposals currently under examination are completely unworkable in practice. As a result, if the system were to come into force in the version currently proposed by the Commission, it would prove absolutely catastrophic for economic relations. I believe that these strict regulations designed for sensitive areas should not be applied to small consignments and basic necessities.

Henderson
I have very little to add except to say that there is a need for reform. The precise nature of the reform should be achieved in a balanced and measured way. Where there are costs involved, they have to be borne. One would hope that in the long term there would be a saving because a new system would prevent abuses which have cost public revenue in the past.

Tomlinson
I was fascinated by Mr Rübig's question, particularly as it refers to the Committee of Inquiry that I chaired. I would just like to ask the President-in-Office if he will agree with the main conclusions of the Committee of Inquiry, in particular those that relate to the role that computerization can play in preventing the loss by fraud of excise duty to Member States and own resources to the European Union budget? Is he aware that the transit system as it now operates is so porous that billions of ecus are being lost across the Member States and that serious efforts are by the Member States are needed to inject the necessary urgency and political will into the resolution of this problem? Will he give us his assurance that the presidency will make sure that this continues?

Henderson
I thank the honourable Member for his supplementary. The answer is that the Council is aware of the report produced by the honourable Member's committee. It has endorsed the general outlines of the plan and recognizes, as I said in relation to a previous question this afternoon, that computerization is a very important aspect of any changes which will enable a check to be kept on the transit of goods. Hopefully, this will outlaw abuses and lead in the longer term, once the system is in place, to increases in public revenue.

President
In accordance with Rule 41 of the Rules of Procedure, Questions Nos 13 and 14, by Olivier Dupuis and Ursula Stenzel respectively, lapse because they refer to the situation in Kosovo and, as you know, a debate on that subject was included in the agenda.
Question No 15 by Nikitas Kaklamanis (H-0524/98)
Subject: Autonomy in Northern Epirus
According to the UN Charter, autonomy is one of the inalienable civil rights of peoples. In the EU, autonomy is a common form of institution; countries such as Italy, Spain and Finland have granted fundamental rights to autonomous regions on their territory. Northern Epirus is a region of Albania whose right to autonomy has been established (as long ago as 17 May 1914 by the "Corfu Protocol' ) and provision made for the protection of the population's language and religion. Moreover, the Protocol was signed at the time by the plenipotentiary countries of the (present-day) EU (Italy, Great Britain, Germany, Austria and France) and by the Special Representative of Albania himself.
Will the Council state its position on this issue, which concerns the protection of human rights in a country which desires closer relations with the EU but which has refused for years to honour the commitment that it undertook? Mr Henderson, you have the floor to reply to Mr Kaklamanis' question.

Henderson
The presidency welcomes the significant progress made by Albania regarding the rights of Greeks living in southern Albania. It encourages Albania to continue to make improvements in this area. Albania has repeatedly declared its commitment to observe the rights of the Greek minority in accordance with international standards.

Kaklamanis
Mr Henderson, I am very sorry but you have not answered my question. You have answered another question, which I did not ask you. I am very clear on the matter. Does the UK Presidency divide autonomy into good and bad? Does it give the right of autonomy to some people but not to others? Your country signed the Corfu Protocol of 1914, which refers to autonomy in northern Epirus. My question is this: how is it possible, through the use of weapons, for the European Union to want to grant autonomy to the Albanians in Kosovo and for the European Union, through your own presidency, to refuse to implement an instrument which bears the signature of five Member States of the European Union and that of Albania? I would like you to answer my specific question, and I would also like you to tell me whether, in the discussions which are taking place in the Council on autonomy in Kosovo, the Greek government has raised the issue of the autonomy of northern Epirus.

Henderson
I refer to my previous answer, that political encouragement has been given to Albania to recognize the rights of Greeks who live in the southern part of Albania. The Albanian Government has declared its commitment to meet the necessary international standards in this regard. The matter has not been specifically raised in the Council by the Greek Government - or, if it has, I am not aware of it.
In relation to the general point, one cannot say that the solution should be the same in every situation in every region or country in the world where there is an argument about regional devolution in one form or another. One really must look at the situation that pertains in any country. Indeed, those who believed they were a persecuted minority might want differing solutions in different countries even though the persecution was of a similar nature, for all sorts of historical, political or economic reasons. So one must look at particular situations. But, generally, it is consistent with the Albanian Government's statements of support for a greater say over their own affairs by the people of Kosovo that the Albanian Government recognizes within its own borders that special needs have to be accorded to the Greek minority who live in the southern part of Albania.

President
Question No 16 by Hugh McMahon (H-0526/98)
Subject: Removing obstacles to trade
Can the Council inform Parliament of the terms of the agreement at the Internal Market Council of Ministers' meeting on 18 May concerning legislation removing obstacles to trade?
In particular, what powers have been accorded to the Commission to demand that states take the "necessary and proportionate measures' to remove such obstacles to trade? Mr Henderson, I invite you to reply to Mr McMahon's question.

Henderson
The Council reached unanimous agreement in principle on a regulation and resolution on the functioning of the internal market in relation to the free movement of goods among the Member States. Parliament will be reconsulted on the text of the regulation since it is substantially different from what the Commission originally proposed. The regulation requires the Commission to request a Member State to take action within a period which it shall determine. The Member State then has five days in which either to set out the action it will be taking or to submit reasons why it does not consider that there is an obstacle. The regulation also sets up an information mechanism to keep all Member States informed of actual or potential obstacles and action being taken against them.

McMahon
I thank the President-in-Office for his very full answer. I am pleased that the British presidency has curbed the zeal of the Commission, which really wanted to exercise excessive powers, which could have meant restraints on the right to strike and legitimate trade union practice. Would the Council not agree with me that we now have a more sensible compromise, and that no doubt there will be successful proposals coming forward from this Parliament when it expresses its opinion?

Henderson
I have known Mr McMahon for a number of years and as ever I agree with the point which he has raised. I gladly accept his congratulations on the Council's view on this matter. I assure him that in any revised position we will be ensuring that the measures do not affect the right to strike or other fundamental rights.

President
As the author is not present, Question No 17 lapses.
Question No 18 by Gary Titley (H-0537/98)
Subject: Problems facing beneficiaries of wills across the EU
One of my constituents has inherited a legal estate through the will of a relative. He has been informed that as different parts of the estate are in both Ireland and Britain, he will have to go through the legal processes and costs of securing executor's oaths and powers of attorney in both countries. What proposals will the Council produce to ensure the harmonization of legal procedures for births, marriages and deaths, so that in future the Single Market will serve the citizens of Europe from the cradle to the grave? Mr Henderson, I invite you to reply to Mr Titley's question.

Henderson
The Council has no plans to harmonize the present procedures in Member States of the European Union relating to the inheritance of property on death. In view of the widely differing national laws relating to inheritance - particularly of family property - and the formalities relating to the drawing up of wills and the procedures involved in their administration, the technical difficulties that would be involved in such a project would be formidable. The honourable Member has also raised the wider issue of the harmonization of legal procedures for births, marriages and deaths in this context. I would draw his attention to a convention on jurisdiction and the recognition and enforcement of judgments in matrimonial matters which was agreed by the Council of Ministers at the end of May.
An important benefit of this agreement is that it will ensure that orders in Members States in divorce and similar cases, including orders affecting children at the time of divorce, will generally be recognized throughout the European Union with the minimum of procedural requirements. If this is furthered by regulating the competence of divorce courts, this should help to avoid the present confusion among courts in the European Union.

Titley
Could I thank the President-in-Office for his very full answer. Since putting this question down I realize that this problem is much more extensive than I had anticipated. One of the benefits of the single market is that people can now own property anywhere in the European Union. A number of people take advantage of those provisions to retire to countries like Spain; clearly that is an ageing population and inevitably people are dying and their families are finding that they are getting entangled in a legal nightmare. I recognize the impossibility of harmonizing legal systems but as the President-in-Office has said we have just agreed a convention on divorce. I would have thought that if we can sort out divorce we can sort out deaths. Could not the principle of the conventional divorce, whereby there is mutual recognition of legal systems in Member States, also be applied in this case? I would summit this is going to be a bigger problem. If we are going to build a Europe for the people then we ought to sort out the basics of births, deaths and marriage so that the single market does cater for citizens from cradle to grave.

Henderson
I am not sure if everyone will agree that if we can sort out divorce we can sort out death. It is complicated enough sorting out divorce. I think that the honourable Member raises an important point. As Europe becomes a more mobile area and people move from one part of the European Union to another then increasingly there will be problems that arise because of that movement of people, especially when it happens in large numbers - and the numbers are growing. I think all of us in the United Kingdom know friends who have retired to Spain or to Ireland. I am sure that all Members from different Member States could quote similar experiences so the honourable Member raises an important point. In my original answer I explained the current position of the Council but it would be wise for all of us to think further on this. During this presidency the honourable Member will be aware that justice and home affairs has been a lively area where a lot of change has taken place and a lot of future change has been initiated, and it is an area where those who have been involved in this question will want to give further thought, because it needs practical solutions.

President
Question No 19 by Marie-Paule Kestelijn-Sierens (H-0540/98)
Subject: European subsidies on school milk
Can the Council explain why, under Article 2 of Council Regulation 1842/83 , sterilized full cream milk is the only kind of full cream milk excluded from the European subsidy scheme for school milk, in spite of the fact that it is the only kind of full cream milk sold in glass bottles? Does it not consider that schools which opt for educational and environmental reasons to supply milk in returnable glass bottles are being unjustifiably penalized for this under the subsidy scheme? Mr Henderson, I invite you to reply to Mrs Kestelijn-Sierens' question.

Henderson
Sterilized whole and semi-skimmed milk has been ineligible for European Community school milk subsidy since the introduction of the scheme in 1977. When the scheme was introduced the list of eligible products took account of the market situation, availability and the type of product actually supplied to schools at the time. The list has been amended over the years at Member States' request but there has been no request to add sterilized unflavoured milk. Its inclusion would require amendment of Council Regulation 1842/83 or of the detailed implementing rules in Commission Regulation 3392/93 which provides for a derogation from specified heat treatments.
I am surprised that sterilized whole milk is the only type of milk supplied in glass bottles in some Member States. In the United Kingdom pasteurized and UHT milk is available in glass bottles while sterilized milk tends to come in plastic bottles. There is of course no link between the type of container and eligibility for subsidy.

Kestelijn-Sierens
I thank the President-in-Office for his reply, but I am left with the problem that between a quarter and half of the schools in Belgium provide milk in glass bottles to their children. This concerns sterilized whole milk which is only available in glass bottles. In order to reach a solution, the directive should be modified since it excludes sterilized milk. This means that environmentally-minded schools receive no subsidies, even though they use glass bottles. I would like to urge a modification to the directive on this issue.

Henderson
I am so used to answering questions in the British Parliament by saying No that I find it quite difficult to say 'Yes' sometimes. I say to the honourable Member who raised this question that she has raised a real point. So far Member States have made no requests for the addition of sterilized milk to the list. As I understand it, sterilized milk is 5 % of the European Union liquid milk market. If there is a need for a modification to the regulation, perhaps the Belgian Government could consider making representations to the Commission. If there is a logic to the case, there will be receptiveness in the answer.

President
Question No 20 by Maj Theorin (H-0541/98)
Subject: Relations between India and the EU
India has conducted five nuclear weapons tests and created instability in its region. Pakistan has announced that it will conduct its own nuclear weapons tests. The risk of a new nuclear arms race, global as well as regional, is obvious.
The EU is an important partner for India as regards cooperation. It possesses political, economic and diplomatic leverage. The USA is urging that sanctions be imposed on India, but there are alternatives, such as suspending cooperation agreements, stopping aid and prohibiting all exports of arms or arms parts.
The EU thus has an opportunity to criticize India not only in word but also in deed. What action does the Council think the EU should take? Mr Henderson, I invite you to reply to Mrs Theorin's question.

Henderson
The European Council welcomed the conclusions of the meeting of P5 Foreign Ministers in Geneva on 4 June and G8 Foreign Ministers in London on 12 June as a positive contribution to the process of encouraging India and Pakistan to address constructively the issues which divide them. It also welcomed the decision by some Foreign Ministers on 12 June to establish a taskforce to promote non-proliferation in South Asia.
Previously, the Council has called on India and Pakistan to engage urgently in dialogue on regional stability issues and agree confidence-building measures to reduce tension and urged them to sign and move to ratify the comprehensive test ban treaty, join negotiations on a fissile material cut-off Treaty, exercise stringent control over nuclear-related exports, and commit themselves not to assemble or deploy nuclear weapons.
Member States have already worked for a delay in consideration of loans to India via the World Bank and other international financial institutions and will review the advisability of international financial institution lending to Pakistan in the relevant institutions in the light of the economic and financial circumstances. The Council has also asked the Commission to review India's and Pakistan's continued eligibility for GSP preferences.

Theorin
That was a good summing up of many proposals we would like to see implemented; above all the condemnation of India and Pakistan. However, there was one measure which I clearly missed, namely that we were willing to take measures with regard to arms exports or the export of weapon parts to India and Pakistan.
In percentage terms, India is competing harder in the area of military research than any other country in the world apart from the USA. Their new prime minister has proposed an increase of 100 % over five years. There is therefore a very dangerous situation with regard to both conventional weapons and nuclear weapons in this region. It is a serious situation which demands a response and action from the outside world. But, of course, the five permanent nuclear weapons powers must also accept their responsibility and follow the measures they promised in Article 6 of the non-proliferation treaty, namely to seriously negotiate a real reduction in nuclear weapons. Otherwise no actions will be credible.

Henderson
I thank the honourable Member, as ever, for her supplementary question. I am pleased that she recognized that the original answer covered much of the ground that she would expect to be in the response of the Council. She was somewhat critical of the lack of an arms embargo. I say to her that there is no consensus in the Council for this. But even if there were, it would be doubtful if it would be effective because Russia is a main supplier of arms in this particular situation to India.

Titley
I should like to say how much I have enjoyed spending my Wednesday afternoons in the company of Mr Henderson for the last six months. I look forward to the Austrian presidency.
Does the President-in-Office not agree that this current situation reinforces the need for Western powers to take seriously the dangerous potential insecurity in this region, particularly in view of the running sore of Kashmir between India and Pakistan and the ongoing problems of disputes between India and China? We ought therefore to have a fresh political initiative in order to ensure greater stability in the region.

Henderson
I wish to say to the honourable Member that it is so pleasant to do business with a man who is so easily satisfied, and I look forward to continuing to try to satisfy him in other forums on other occasions.
He is absolutely right that the recent events in India and Pakistan highlight the need for the rest of the world to enter into a dialogue with both of those countries and other neighbouring countries to try to build a stability which will ensure that what was a relatively minor problem, which has become a very much greater problem, does not become an even greater problem in the future. The honourable Member is absolutely right to bring that to the Council's attention.
Mr President, before I sit down, I just wish to say to you that this is the end of my six months of reporting to Parliament and it has been a pleasure to have operated under such a genial chairmanship as your own and one which has been courteous and fair. I apologize for the fact that once or twice airlines have not cooperated with either Parliament's timetable or mine and it has led to deviations from our original intentions. But I hope that we have covered the ground, and I thank you very much for your chairmanship.

President
Thank you very much, Mr Henderson.
Ladies and gentlemen, that concludes Question Time. Questions Nos 21 to 44 will be dealt with in writing.
As Mr Henderson said, today's sitting marks the end of six months of collaboration in questions to the Council. I would like to say, Mr Henderson, that Mr Titley is not the only one who is glad to have shared some of his afternoons with you. As President, I have had the honour and pleasure of sharing all my Wednesday afternoons with you, and I would like to express my thanks and satisfaction. I would also sincerely like to wish you all the best for the future, and I hope we meet again, here or somewhere else. In one of the later questions, it was repeatedly said that many people go to Spain to retire. Mr Henderson, Spain is a good place to go to even before you retire. I hope we may be able to meet there, too.
That concludes questions to the Council.
(The sitting was suspended at 7.00 p.m. and resumed at 9.00 p.m.)

Harmful tax competition (continuation)
President
The next item is a continuation of the debate on the report (A4-0228/98) by Mr Carlo Secchi of the Committee on Economic and Monetary Affairs and Industrial Policy on the Commission's communication to the Council and the European Parliament concerning a package to tackle harmful tax competition.

Svensson
Mr President, I would like to draw the attention of the Bureau to defects in the text of the report we are now debating. The German version and the Swedish version contain 22 paragraphs. However, the English version contains 35 paragraphs. We are all anxious to know what we are going to be voting for tomorrow.

President
Thank you, Mr Svensson. We will take note of this. Your comments will be given consideration. I can promise you that.

Vanhecke
Mr President, after monetary union, it was to be expected that sooner or later the harmonization of the tax systems of the Member States would be raised as part of the project for a federal Europe, which is gradually being imposed on us, whether we like it or not. I fear that today's debate is only the first act in a long play. It may be packaged under the heading 'countering harmful tax competition' , but ultimately it boils down to the same thing: the powers of the Member States are being moved in dribs and drabs, but very systematically, to federal level.
I am not in any way opposed to extensive European consultation and collaboration. Nevertheless, as a Fleming I am wellqualified to be critical of this form of equalization. As you know, the Flemings find that they now are unable to introduce essential reductions in taxation - at their own expense, would you believe - within the federal state of Belgium - for example, regarding social security taxes or the burden of taxation on labour -, as these reductions have been vetoed by the federal partner in the Walloon provinces.
The question may therefore justifiably be asked whether the hypothetically harmful tax competition which would be countered, and which nevertheless also has advantages, would ultimately not be a lesser evil than the federal uniformity which threatens to replace it. May I remind you that large companies and capital are easily moved outside the European Union for tax purposes, an option not available to the average citizen.
Finally I should mention, albeit not with a totally clear conscience, that a variety of tax advantages are granted to the European institutions that are not available to the common citizen in our Member States either. Those who wish to harmonize and equalize would do well to start with themselves, if not, they should leave well enough alone.

Metten
Mr President, the introduction of the euro has caused the Member States to realize that their direct taxes require some tax harmonization. The code of conduct relating to harmful tax competition, dated 1 December of last year, was the first writing on the wall, and we hope to see a future agreement regarding tax on interest for non-residents. The need for such initiatives is obvious. Since 1980, the burden of tax has been shifting from mobile factors such as capital to the least mobile factor of labour. Europe will not succeed in drastically reducing unemployment, presently standing at 11 %, without departing from this trend.
The Secchi report recognizes the above mentioned necessity for some harmonization in the area of direct taxes in order to prevent the race to ruin. However, a new concept, that is, profitable or healthy tax competition, was introduced in this report, to which my group strongly objects. This seems to me to be a totally muddled concept which assumes that tax competition exists which has favourable social effects. Admittedly, variations in taxation will continue to exist, and these variations will always lead to competition. Tax competition is inevitable in this sense. But we cannot see how this competition could be beneficial to persons other than those who are subjected to it. Differences in taxation create a constant pressure on governments to lower their tax rates. The more mobile the tax source, the harder it is to resist this pressure. The result, however, is seldom a lower level of tax, but rather a shift of the burden of tax to the least mobile source, namely, labour. That is what we have seen in recent years. It is one of the reasons for the high unemployment rate in Europe.
I would advise the right-wing members of this Parliament to think twice before coming up with tangled concepts such as tax competition.

Thyssen
Mr President, the internal market is now five years old, and, as the rapporteur stated, the arrival of the euro will render it more transparent and efficient. Everyone knows by now that, besides eliminating the traditional obstacles to free movement, the internal market can only function well with a proper competition policy. The Commission has considerable powers at its disposal in this respect and is taking firm action in cases of unlawful governmental support or actions by companies that reduce competition. Unfortunately, a similar range of instruments is not available to the Commission with respect to removing the harmful effects of fiscal competition. Unless this changes, Member States will continue to steal a march on each other with specific provisions for non-residents; the fiscal shopping around on the part of companies and private citizens will only increase.
In addition, the risk of erosion of state revenue will become a real threat, which is certainly not a good thing in times of budgetary constraint. Finally, the trend during the past decade to lighten the burden on mobile factors at the cost of the less mobile labour factor could not be reversed, despite any number of employment debates. It is therefore laudable that the Commission has presented this package and that the Council has also decided at long last that something must be done. Cardiff has emphasized this as well.
It is a cautious beginning. The question of harmonization has not yet been raised in any of the three selected priority areas, which are therefore limited to coordination here and there. The package method is a step in the right direction for Europe and the Member States, but the package, which contains no more than three products, would appear to be rather minimal. Indirect taxation and border labour also suffer badly from the lack of fiscal harmonization. The package presented by the Commission is admittedly a good move for us politically, but only as a first step, that is, with the condition that further steps must follow, including those relating to the decision-making procedure. It would not be right for the Member States to maintain the unanimity rule and give the impression to their citizens that they are safeguarding their powers with respect to fiscal matters, when that same unanimity rule prevents the Member States from realizing the harmonization required to counter harmful tax competition and the erosion of tax revenue. By retaining the unanimity rule the Member States are themselves undermining the formal powers they cling to so eagerly.
Mr President, I would like to ask the Commissioner three questions before closing. Firstly, a code of conduct working party has been established which is to implement specific matters. How will this be democratically controlled? Secondly, does the Commission intend to talk anyone else outside the OECD into taking one or more of these measures? Thirdly and finally, Mr President, when can retailers in border areas expect the VAT rates to converge? My congratulations to the rapporteur.

Kestelijn-Sierens
Mr President, Commissioner, ladies and gentlemen, I would first like to congratulate the rapporteur on his report. We agree with the proposal in the Monti package. Unfair competition in the area of company taxation must be eliminated. In five years time there should, therefore, be no more fiscal constructions set up by Member States to entice companies from other Member States. A provision for savings is also required. All sorts of calculations are being made about how much the new regime will contribute to the national treasuries. However, we should not be under any illusion, as savings are also deposited outside the Union. But the Council is correct in its conclusions dated 1 December of last year that we must safeguard the competitiveness of the European financial markets. In this context, I would imagine that an advance levy on income derived from securities of 20 % or more would be counterproductive. Large savers will undoubtedly invest their money outside the Union.
In conclusion, I have one more question for the Commissioner. I know that the text of the directive on the tax regulation for savings has been finalized. When does he expect this directive to take effect? Many citizens are, of course, interested in this matter.

Svensson
Mr President, the positive thing about this report is the criticism of so-called tax havens and demands for minimum standards and for a duty to inform to apply to banks. However, the idea of more general tax harmonization is unrealistic. It would be a serious encroachment on the prerogative of national parliaments and the rights of the citizens to shape their country's tax policy through elections. It could also upset the stability of state finances. The Member States have such different tax systems that they would be forced at the same time to harmonize all sorts of taxes. This is politically and practically impossible and an unrealistic idea which we should abandon.

Formentini
Mr President, I would like to echo the compliments expressed by other speakers to the rapporteur. Allow me to congratulate him on the content of his report which, whilst containing comments on and criticism of the Commission, essentially supports the Commission in what I consider to be its bold intervention in Member States' tax policy.
Particularly once Economic and Monetary Union has come into force, there is no doubt that Member States, who are being stripped of what margin for manoeuvre they had on budgetary and monetary policy, will not easily relinquish their prerogative on tax matters; there will certainly be resistance. The Commission therefore needs Parliament's backing on this, and I believe that, in the democratic spirit which drives it, Parliament will support it.
Let us not forget that nearly all Member States, particularly the larger ones, have created oases within their borders. We are not talking about tax havens, but oases in which taxation is somehow lighter. These oases spark off competition, and the competition system hampers the healthy and harmonious management of taxation which would create the results we are seeking, including in terms of economic progress and growth.
I would like to stress, moreover, that we must safeguard the possibility of using the tax lever, applying tax incentives for areas which need to expand; there are some outstanding examples of this in the Community. These should still remain possible because even labour taxation, for example, can allow areas with difficulties to get onto an equal footing with other areas of the Community.

Ettl
Mr President, Commissioner, ladies and gentlemen, in his report Mr Secchi has shown a great deal of sensitivity, which is very important in dealing with such a delicate issue. However, we must under no circumstances allow ourselves to close our eyes to the economic reality of the European Union. It is a fact that the single currency, the euro, amongst all its positive effects, will also have a politically positive side effect in that it will stimulate extra activity in the overall policymaking of the European Union. And for me this extra activity means that things will, at last, have to get moving in the tax sector.
It will not stop at coordination. We will have to move on to harmonization, and there are many reasons why this is the case. I myself think that we should move away from the principle of unanimity. Europe needs a certain level of coordination, better coordination in the area of tax policy, precisely because many different levels of tax burden apply in the European Union. Labour is too heavily taxed. Corporate groups are largely left to deal with their tax matters as they see fit. Small- and mediumsized businesses don't really get a look in. In truth, it is only the international tax consultancies who really benefit profit from the situation.
What we need is better coordination in order to eliminate certain double and multiple taxation problems. It is quite simply unacceptable that Europe has coordination centres, as is the case in Belgium, which make large loans to groups and subsidiaries of groups with interest payable outside the country in question, where in turn they are subject to very low tax rates and thus in practice manage to avoid the whole taxation process. This is unacceptable! These practices exist all over Europe and we must get rid of them. This is our chance to achieve better harmonization in this sector.

García-Margallo y Marfil
Mr President, I will not repeat any of the comments made by Mr Secchi, which I support from start to finish. I would prefer to concentrate on one point concerning the stage at which we Europeans find ourselves after the coming into force of the euro.
We Europeans have from now on rejected the possibility of devaluing currencies in order to recover lost competitiveness by way of a short cut. We have also rejected the use of monetary policies as a national instrument to create employment in the oldest sense of the Phillips curve. In addition, we have rejected budgetary policies by signing up to the Stability Pact.
Now it is time for us to tackle the problem of fiscal harmonization, which still remains to be solved. And here there are two conflicting ideas: one - from the Council - which is timid, narrow-minded and slow; and the other which is the one the Commission wants to opt for.
I would like to assure the Commissioner of my personal support for the efforts he is making in order to overcome the Council's opposition, and would like to emphasize several points relating to the package being presented to us here today.
As regards fiscal competition, I completely agree that a single market, with a single currency, is not compatible with fiscal privileges which distort competition. However, it would be appropriate if, alongside allowances, tax reductions or increases in credit facilities, the Commission tackled the complex problem of state aid.
One thing that has been talked about during the days in the run-up to the Cardiff Summit is the desire on the part of some Member States for the principle of subsidiarity to be applied in an unequal manner, in such a way that the Commission cannot control, review or examine state aids. I cannot see any difference between aid granted by means of tax reductions and aid granted from items of public expenditure.
Secondly, as regards taxation on savings, I share the Commission's view that it is unacceptable to increase taxation on work while decreasing the tax burden on capital. Nevertheless, I believe that the measures which are being implemented, and which we are currently considering, are insufficient.
I think - and this is not the moment to go into this as I do not have time - that we will need to consider whether the model of calculated added value for consumption is still valid, a model we approved at a time which was very different to that in which we now live.
In conclusion, Commissioner, I would like to reiterate my support for the efforts being made to overcome the Council's opposition and to move towards the harmonization which we Europeans now need.

Boogerd-Quaak
Mr President, Commissioner, the Monti package is a good impetus for further coordination. We must find the right balance between policy coordination and competition. In my opinion, we should not compete outright in a number of policy areas but rather arrive at cooperation. In this respect, I believe that the code of conduct regarding corporation tax should be elaborated further. In its present state, it provides a host of possibilities for tax evasion, and the entire issue of VAT has been disregarded in these proposals, which is regrettable. I do not consider this to be Commissioner Monti's fault, but rather a matter which the Council is still afraid to tackle. The same applies to indirect taxation, such as creating environmental and energy taxes to avoid increasing taxation on employment, as has been mentioned often by other Members. The reduction of double taxation on wages, in particular, should be given a higher priority. I do not blame Commissioner Monti, but I do blame the Council.

Lukas
Mr President, the introduction of monetary union will create a previously unknown level of transparency and thus of total comparability of all prices and costs from one Member State to another. As a result, competition-distorting differences in many areas, including environmental conditions for example, but of course above all the tax sector, will take on a new and greater dimension.
Our domestic market with its complete liberalization and freedom of movement must have fair competition conditions, otherwise it may produce shifts and changes running counter to economic and social balance. Harmful tax competition can destroy the economic advantages of the single market in the states in question and runs contrary to the logic of economic and monetary union.
Strictly speaking, reaching the degree of tax harmonization we are currently labouring to achieve should have been be an important condition for introducing Economic and Monetary Union. In this respect I welcome Mr Secchi's report with its very clear and logical assessment of the Commission's communication. I believe it is important for us to agree that tax coordination - in terms of reducing the labour factor - is necessary and can therefore also serve as an important instrument in the fight against unemployment. The achievement of a compromise between tax sovereignty and stronger voluntary economic coordination is an inescapable necessity for any state which wants the single market and monetary union to work.

Caudron
Mr President, Commissioner, ladies and gentlemen, I too would like to congratulate the rapporteur, Mr Secchi, very sincerely for having successfully handled a particularly difficult task when it comes to encroaching upon national, in some cases even nationalist, prerogatives.
In my report on European industrial competitiveness, I myself proposed fiscal harmonization in order to avoid anarchic competition between Member States and in order to produce beneficial effects at the level of business competitiveness. I am also delighted at the adoption of a code of conduct in the area of business taxation by the Ecofin Council. There is currently concrete progress which points to real hope in this area.
With regard to the text of Mr Secchi's report, there are however a number of points which raise certain fears and doubts for me. I consider that the bias in favour of a correlation between lower taxes and lower unemployment is far too optimistic. If such a simple solution existed, there would no longer be any unemployment in Europe. Similarly, I do not support the lowest tender fiscal policy which the rapporteur seems to suggest, for it encourages negative competition between Member States. I would finally like to remind you that tax deductions also result in a redistribution within society as a whole: education, research, security, infrastructure - none of these would be accessible to everyone without a fiscal policy which enables strong public intervention.
In conclusion, I would like to reaffirm my conviction as a Member of the European Parliament and as a Frenchman, that it is necessary to harmonize the Union's fiscal policy. However, we must keep in mind that this fiscal policy is a way of constructing a political Europe, and that it is a political Europe alone that can legitimize a fiscal Europe.

Matikainen-Kallström
Mr President, I would like to thank the rapporteur for some excellent work. The report presents us with a splendid opportunity to discuss the weapons the Union will choose to combat harmful tax competition between Member States. Divergent national tax systems and the competition they lead to will result in a total failure to achieve the prospects for growth and employment in the internal market.
In many Member States, the level of tax on labour is the greatest barrier to solving the unemployment problem. The higher overall labour costs are, the higher the unemployment rate generally is also. Unfortunately, harmonization has not extended into this particular sector. What has happened at national level is at best special tax allowances for foreign executives and the use of option and other tax systems, which, in conjunction with a low rate of capital gains tax, results in production becoming capital-intensive, thus exacerbating the unemployment problem.
The Union has quite rightly intervened in indirect taxation, for example by aiming at harmonization of VAT. Otherwise tax on tobacco, alcohol and car tax, for example, can differ quite substantially from one country to another. When the Union fusses over the abolition of the duty-free system, it forgets that this only serves to cause unemployment and preserve different levels of indirect taxation.
Tax havens can only be created in countries whose national economies are in good shape or with an undeveloped social security system. They are able to compete with low taxation. Countries with a high rate of taxation, which, in addition, have problems balancing their budget, apply negative tax competition instead: in other words, they burden their own citizens with high special taxes. Tackling this problem is at least as important as intervening in harmful positive tax competition.

Wibe
Mr President, I think that this report contains a lot of good things. However, I would like to talk about three things that are not included, and which I think should perhaps have been included.
The first concerns the Ecofin group which is to be set up to monitor the application of this Code of Conduct. Its meetings are secret. I think Parliament should have called for the minutes of these meetings to be published as soon as possible.
The second point which I find lacking comes in part two of the action plan, and concerns the duty to inform which people are considering applying to banks within the Union. In fact a very common way of avoiding tax today is to place your capital in another country and then withhold information on income from this capital from the tax authorities in your home country. This is a quite simply criminal tax fiddle which is taking place on a large scale within the Union today. A very simple way to overcome this, Mr President, is to impose an obligation on banks to report to the authorities in the capital owner's home country that this income exists, so that they can be taxed. I think Parliament should have said that we welcome such a duty to inform.
The third point concerns measures against tax havens. Obviously, like the rapporteur, I too welcome the fact that we are trying to tackle this problem within the Union. However, I think we should perhaps have pointed out that to get a definitive solution to this problem we need a global agreement, otherwise there is a risk that capital owners will move their capital from one of the Union's tax havens to a tax haven outside the Union.

Lulling
Mr President, I did not vote for Mr Secchi's report in the Committee on Economic and Monetary Affairs and Industrial Policy and I will not vote for it in the House, because it proposes a fool's bargain in the sense that, in practice, it advocates non-respect for the demand for simultaneous adoption of the Community directives on business taxation and taxation of savings.
There is no way we can be satisfied with a code of conduct in the area of business taxation whilst demanding a directive on the taxation of income from savings, especially given that harmful tax competition is far more important in the area of business taxation than that of the taxation of savings.
In this latter field, my amendment recalling that the competitiveness of European financial markets at world level must be protected was fortunately taken up by the committee, which particularly delighted and reassured my colleague, Mr Fayot, who is no longer here and who, unfortunately, was also absent from the committee when this amendment was voted on.
Mr Secchi's report goes as far as putting in the rubbish bin the integration of the legislative process with regard to the different components of the package formulated on 1 December last year by the Ecofin Council. My amendment clarifying that there is no cause for killing fair tax competition within the European Union was rejected, as was my amendment which confirmed that the only objective of harmonization must be the elimination of real distortions which truly interfere with the single market. An example of this, in the area of indirect taxation, is the excessively high rate of excise on wines coming from certain Member States - and Mr Monti will have understood clearly that there is no cause to take initiatives to kill the zero rate in this area.
Mr Secchi's report calls for the elimination of tax havens in the internal market. No Member State is a tax haven, quite the contrary, but many territories which have special relations with certain Member States, such as the Isle of Man, the Dutch Antilles and so on, may be considered as tax havens. In the internal market, there will be a need to eliminate these.
It is furthermore intellectually dishonest, if not hypocritical, to consider an eminently social model of taxation as a tax haven, such as that in my country which imposes reasonable rates of VAT and excise duties - to the advantage of the low paid - and taxes higher incomes more heavily; which treats non-residents the same as neighbouring countries with regard to taxation of savings but which fortunately refrains from confiscating income from savings, savings made, by honest people, on the basis of income on which the taxpayer has already paid his or her taxes.
The taxation of border work is held up as one of the areas in which fiscal harmonization is necessary. On this subject it is sufficient to ensure respect for the principle by which it is appropriate to consolidate, in the country of employment, the payment of social contributions and income tax.
Mr President, I fear that a number of exaggerations in this report hardly contribute to consolidating the Ecofin Council's decisions of 1 December last year, reached under the Luxembourg Presidency, which deserve credit for unblocking the process of direct fiscal harmonization, but which must not be the victim of a fool's bargain.

Torres Couto
Mr President, I should also like to begin by congratulating the rapporteur, and I would like to say that I understand that a certain degree of competition between national tax systems may in fact stimulate efficiency and benefit consumers. But it should be emphasized that the present inequalities between tax systems can also contribute to making it impossible for us to reap the profits we might otherwise obtain from the internal market in terms of growth and employment.
So I think it is becoming a matter of urgency to improve the coordination of these policies, which are a hindrance to the proper working of the internal market. Particularly in the area of taxation, bearing in mind that tax coordination can be used as an essential instrument for the practical implementation of our employment policy guidelines by reducing the tax burden on employment.
We must reverse the taxation philosophy we apply to the labour market and other production factors, especially capital. As the rapporteur quite rightly emphasizes, between 1985 and 1995 taxes on employment increased by 20 % while taxes on capital decreased by 10 %. We shall only succeed in creating jobs when we have the political ability and the political courage to reverse that trend.
It is therefore vital that we should adopt a package of measures that deserve the support of Member States and include, for example, a code of conduct for company taxation, and conditions that will make it possible to reduce the tax burden on those who promote employment, with a consequent reduction in non-wages social costs.
To succeed in our fight against unemployment it is important to counteract the disastrous consequences of harmful tax competition, and I would emphasize that, if it becomes necessary, we must retain beneficial forms of competition in taxation between Member States as an instrument for increasing the competitiveness of the European economy in the face of the present challenges of the global market.

Sindal
Mr President, a number of shrewd observations have been made this afternoon and this evening. I would like to look at this matter more in terms of principle. Firstly, I must say it is a good thing that we are taking this up, and I would also like to congratulate the Commissioner on his excellent results in Cardiff. The Council has also followed the recommendations in the document forwarded by the Commission. To my mind, there is a matter of principle involved in these problem areas. My premise is that we should deal with trans-border fiscal matters. That is where the problems lie. My honourable friend Mr Gallagher from Ireland made a fine contribution this afternoon, amply illustrating the problems of company taxation. I can well understand our delight at creating jobs in one place, but I do not like the fact that jobs are simply disappearing elsewhere, which means that jobs are not really being created at all and that the Union is not making any progress.
The second point I would like to mention is environmental taxes or duties. These traverse borders just as company taxation does. Here, too, we need to keep in step.
Once again, we have heard Ms Lulling and also Mr Fayot speaking earlier today about returns on investments, interest, and so forth. What is the good of agreeing on uniform taxation of interest if we cannot even locate the interest? That is the real problem: a lack of openness, or banking secrecy.
Finally, we have what are known as excise duties - as mentioned previously - on spirits, wine, cars, and so on. That, too, is a trans-border issue that we must examine. However, I do not think we should touch on personal taxation. That would not be realistic at present. Overall, the tax ratio is actually fairly uniform. Some countries have heavy user fees; other countries, my own included, have little in the way of user fees. However, adding it all up, for more than half the members of the Union, much the same tax ratio goes on welfare and welfare services.
I strongly recommend that we take a good look at the real world and include a voluntary aspect when implementing changes in taxation within the Union.

Porto
Mr President, may I begin by congratulating Commissioner Monti on the action he has taken on tax harmonization, with all the difficulties that arise from the fact that a unanimous vote in Council is still required in this area.
From our political point of view, the idea that there should be no harmonization, and that the market should resolve the problems, is an attractive one. But we have to be realistic and recognize the certainty that, as economies are opened up and all other rules are increasingly harmonized, competition in the field of taxation would have the effect of increasing the already excessive tax burden on employment.
Thus, while we cannot achieve everything at once, we must pay special attention to the introduction of the euro, which means that we have to harmonize the taxation of savings and interest. When the currency is the same it makes no difference whether, for example, the money is deposited in one country or another, because the countries with the lowest tax rates will naturally benefit and transfers are therefore to be expected.
But the risks of unfair tax competition do not end at the boundaries of Europe in an increasingly open world. For that reason the European Union must close the loopholes by demanding that third countries observe minimum tax rules, which would be just as legitimate as our requirements in the social and environmental fields, and would therefore act as a disincentive to countries outside Europe.
And it is for the same reasons, and even more so, that I wish to voice the strongest agreement with the rapporteur, Mr Secchi, when he says that we should speed up the elimination of tax havens within the internal European Union market - as already mentioned - to put an end to the ruinous tax competition between Member States, which is compatible neither with the single market nor with the spirit of the Community.
As I have emphasized, these havens are of no help to the products and areas most in need of support, and European citizens cannot understand why they continue to exist; or at least, I am unable to explain this in my own country.

Paasilinna
Mr President, Commissioner, ladies and gentlemen, the multiplicity of taxation systems and the way they are in competition with one another result in a situation whereby economic growth cannot be competently steered in the direction of employment. Furthermore, tax competition has a damaging effect on energy and environmental policy, for example. Unequal corporation tax systems attract big business to those areas where treatment is more favourable, and this distorts open competition.
The central problem is the ever greater concentration of tax on so-called immobile factors, that is to say the workforce. For some reason, people imagine that companies that employ human beings are more solvent than, for example, companies that employ robots, since their tax bill is extortionate compared to that of others. Such distortions will have to be eliminated when working on tax systems. At the very least, companies that employ people should at least enjoy the same status as firm with a high degree of automation. The burden of taxation therefore needs to be shifted away from the human labour force and towards activities with a greater ability to pay. Currency dealing and speculation are regarded as more productive forms of business. It is quite intolerable that this activity falls outside the bounds of taxation. Thus, the Union must explore the possibilities of the 'Tobin Tax' as quickly as possible and in the name of better employment policy. In this way we could lighten the income tax burden considerably.
Negative tax havens must also obviously be sorted out. Why do we allow black holes in the taxation system these days here in Europe?

Torres Marques
Mr President, I congratulate Mr Secchi on his report on this important subject. Sluggishness, lack of political will and incapacity have hitherto been the hallmarks of this highly important tax harmonization dossier.
This is a very difficult subject technically speaking, and its political sensitivity is an aggravating factor. The Council's requirement for a unanimous vote is based on the fact that the national parliaments want to have the last word on the matter. And although I can understand that if we carry on along this road we shall find it hard to make any progress, what is certain is that the national parliaments essentially came into being because taxes had to be fixed, and they are not likely easily to accept a role in which they are merely required to rubber-stamp decisions taken by supra-national authorities.
But the creation of a single market and the free movement of citizens and capital have already shown that the existing tax policy causes imbalances in the market that are in many cases highly unreasonable, prejudicial and indeed unfair.
The problem of harmonizing this situation is therefore an extremely difficult one. For that reason the lack of progress and political will I mentioned at the beginning is understandable. The problem is that the results of that inertia are unacceptably harmful to taxes on employment and are too easy on other production factors, especially capital. When the euro comes into force and the internal market is suddenly wide open, some major measures will inevitably have to be taken to bring the various tax systems closer together.
On this point Commissioner Monti has tried to take some positive steps which the Council has unfortunately limited to a few direct taxes. Only the work and experience of the group of experts appointed by Ecofin will be able to guarantee that we have the political will to achieve something in this field. But if it is to do so its work must not be kept secret. One of the effects of the euro will be to make it necessary for tax policies to be approximated.

Pomés Ruiz
Mr President, I would like to congratulate Commissioner Monti and wish him the best of luck in his fight for fiscal harmonization and the elimination of harmful barriers. I would also like to thank my colleague, Mr Secchi, for this excellent report, which will allow us to make better use of the advantages of the single market and monetary union by eliminating fiscal distortions. These distortions exist; they translate today into the relocation of savings and investments - with harmful repercussions on the competitiveness of businesses - and they also mean that there is an increase in the tax burden on workers who cannot relocate.
However, I want to emphasize that the code of conduct expressly recognizes the possibility that in a given Member State there may be different tax legislation and that all legislation must be equally subjected to this process of eliminating harmful distortions. This process of eliminating distortions cannot and should not be used to limit the subsidiarity principle. Nor should it limit the fiscal authority that can now be exercised, in the case of Spain, by the Basque Country or the Autonomous Community of Navarre, whose constitutional relationship states that the fiscal laws passed by the Cortes of Navarre can only be challenged in the Spanish Constitutional Court. Respect for existing levels of authority in the European Union can only strengthen the credibility of the current process of accelerating fiscal harmonization. This process does not unnecessarily discriminate between fiscal rules according to the state or regional body which approves them, but solely determines whether or not their content is harmful for the entire Union. Fiscal differences between the various countries can be advantageous for all citizens, in that they can stem from a different level of public spending on the part of the various administrations, from the best or worst management of their expenditure or from the effective use of public resources.
Therefore, we must take harmonization forward, we must respect the principle of subsidiarity and we must respect the causes which mean that different countries have logical distinctions in their tax burden.

Monti
Mr President, I am most impressed by this rich, flowing discussion. It has touched on some highly technical matters which nevertheless affect political questions at the very heart of the workings of our European Union. It seems to me that on certain fundamental issues we have very broad agreement across the whole of the political spectrum represented in this Parliament.
I would like to warmly thank Mr Secchi for his excellent work on this realistic and balanced report, which provides a highly accurate analysis of the package of tax measures and questions related to harmful tax competition. Let me take this opportunity, Mr President, to say how much I admire the energy and commitment with which Mr Secchi so promptly followed up his report with a proposed report on the draft directive on interest and royalties.
As I was saying, I was struck by certain points where there is broad consensus: one such point is the question of capital and labour. Mr Caudron is quite correct in saying that this is a tenuous link, but the basic link does exist all the same, and any employment policy in Europe is not credible if it fails to make use of the taxation coordination lever in order to reverse the trend we have seen towards increasing taxation of labour. When we talk of capital and labour it should be quite clear that the aim is certainly not to undermine the financial markets. The financial markets are vitally important to the workings of the European economy, to competition and employment. This is why the Commission - as I will repeat once again this evening - is against the idea of taxing financial transactions, as was proposed by Mr Moreau and Mr Passilinna. We believe that we should not discourage financial market operations by taxing transactions, but we feel that within an integrated financial market we need to create a normal system for taxing capital income. It is nothing drastic, it can be done, and it can be done Mr Lulling, Mr Thyssen, in full awareness of the need to avoid penalising competition on European financial markets. That is why we are doing our utmost to act in international fora such as the OECD and the Group of 7, and to extend the principles of the code of conduct and tax on savings to the dependent and associated territories.
Every country - as Mr Fayot said, and I would agree with him - has become a tax haven for the rest. This is why we have focused our attention on cross-border taxation. On the other hand we want to avoid a situation to which several of you referred - for example Mr Peijs - in which inefficient states end up imposing the tax burden on efficient ones. This is the reason behind the fine line drawn in the fight against harmful tax competition - we do not indiscriminately want to tar everything with the same brush and attack every form of tax competition, even fair ones.
I am pleased to see that the Parliament has understood the value of the package approach both for business and for savings. This is why I must also point out that, as far as business taxation is concerned, we have already set the ball rolling. Mr Lulling is already hard at work on this one, not with a directive, but rather with a code of conduct, which is starting to work for savings: we hope that in the not-too-distant future we will get the directive. By the by, Mr Kesteleijn-Sierens was asking when Article 12 of the draft directive on savings should come into force; it says that Member States should adopt legislation on transposition no later than 31 December 1999 which should come into force on 1 January 2001.
The rapporteur himself, Mr Secchi, and other speakers suggested that we should go further than what is covered by this package. I would fully go along with what was said by Mr Randzio-Plath, Mr von Wogau and others: this is just the beginning, but I trust that this package, modest as it may be, has radically transformed the climate of tax discussions in Europe. We can now talk about such matters with some prospect of success. Two years ago - as you well know - it was seen as something completely unrealistic. We have to go further, from coordination to far-reaching harmonization, and on that we had different points of view: this is one of the few points on which there were divergent positions, which I find perfectly normal since there are different philosophical and political views. Some people would see a loss of national tax sovereignty as positive; others fear such loss. We have been working until now on improving coordination, which allows everyone to better exercise the tax sovereignty they have.
Mr Angelilli commented that we should take steps from Community level to bring about a gradual drop in tax pressure. I am convinced that this is the business of the individual Member States; I am also convinced that it would be in the interests of their economies, and I believe that by closing certain loopholes the coordination of taxation puts everyone in a position where they can afford to reduce the gross average rate. Mr Formentini recalled the requirements of regional policy: the code of conduct recognizes these requirements and submits them to certain checking processes.
Let me make another point, Mr President: I was very unhappy two months ago when I had to answer a flat "no' to the request of this Parliament, which was supported by a large majority, to reopen discussions on the intra-Community duty free decision on the basis of a study. But those of you who so strongly backed this package against harmful tax competition cannot fail to realize that it would be highly contradictory to be for this approach yet at the same time to want to keep alive these localised tax havens, the duty free sales.
Finally, many of you pointed out that the euro is driving this harmonization or this tax coordination. Let me state here and now that this has not been the case thus far. Let us be frank: until now their preparing for the euro has not allowed the Ministers for Finance to focus all their energy as we would have wished on the coordination of taxation. Consequently we have, in a sense, been swimming against the tide, although I believe that from now on the advent of the euro will encourage this process.
One closing comment: I rank amongst those who favour getting rid of the unanimity rule on taxation questions because, if I may say so, it would boost this Parliament's decision-making role. Unfortunately we are not yet at that juncture, but allow me to stress that, through close cooperation between the Parliament, in particular its Committee on Economic and Monetary Affairs and Industrial Policy, and the Executive Committee, we were able to get the support of Parliament even under the present institutional system - you are bearing witness to that this evening - and to provide Parliament with the greatest possible amount of transparent information on ongoing work. So in a certain sense we are creating the conditions which I hope will be institutionalised some day.
Thank you for your support, and thank you once again to Mr Secchi, the rapporteur; I hope that we will have other opportunities to go into more detail on these difficult but important questions.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 12.00 noon.

Tax treatment of private motor vehicles
President
The next item is the report (A4-0217/98) by Mr Watson on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy on the proposal for a Council Directive governing the tax treatment of private motor vehicles moved permanently to another Member State in connection with a transfer of residence or used temporarily in a Member State other than that in which they are registered (COM(98)0030 - C4-0145/98-98/0025(CNS))

Watson
Mr President, I should like to begin by congratulating you on the excellent spirit with which you are presiding over this evening's proceedings and the calm efficiency of your chairmanship.
There is not a single question in politics that does not begin or end with taxation. I am moving tonight a report on the tax treatment of private motor vehicles moved permanently from one Member State to another in connection with a transfer of residence or used temporarily in a Member State other than that in which they are registered.
This draft directive has two aims. The first is to update the provisions of earlier directives on tax exemptions for vehicles imported from one Member State to another and tax exemptions applicable to permanent import from one Member State to another of the personal property of individuals. Secondly, the draft directive extends these provisions to problems which have been encountered in the application of the earlier directives and to comply with the internal market and expectations of freedom of movement.
We know that there are obstacles to the free movement of privately owned vehicles, often in the form of double taxation. This is a matter of concern to this House since the free movement of people is a criterion for a successful single currency area. That free movement is hampered by obstacles to the movement of vehicles. Hence we welcome the Commission's proposals.
Generally vehicle taxes are not subject to approximation rules at Community level. This has led to differences between Member States in terms of tax regimes levied on vehicles. The draft directive before us defines the basic rules for vehicle taxation in the context of individuals moving between Member States.
The single market prevents the use of frontier formalities in the collection of taxes, but this has led to some Member States converting excise duties on motor vehicles into registration taxes or introducing new taxes to compensate for VAT rate reductions. My report aims to ensure that there is no scope for double taxation. The measures that are proposed cover two broad categories. First, in the case of transfer of residence, the proposal is that Member States should not impose vehicle registration taxes on cars brought into their territory by individuals who are moving to live there.
Second, for temporary residence the aim is to safeguard the right of the individual to use a vehicle temporarily in a Member State other than that in which he or she lives. There would be a right to use the vehicle for up to six months in any twelvemonth period. Additional elements guarantee or include greater freedom to use rental cars in Member States other than that in which they are registered, and greater flexibility for cross-border workers who use vehicles provided by their employers.
We seek also to improve bilateral communications between Member States in the case of a dispute about a person's place of residence. It is surprising and perhaps depressing that there is not already suitable communication between the competent authorities.
In subsidiarity terms the aim is to provide a common set of rules for the non-imposition of motor vehicle taxes in certain cases in order to help movement of labour and to prevent double taxation.
I am proposing three amendments to this draft directive. They serve as no more than tidying-up measures. They do not change the character or the thrust of the Commission's proposals in any way, but they seek to reinforce the rights of the citizen. The first is to allow for a vehicle that is being scrapped or destroyed, perhaps after an accident, not to incur liability to taxation. The second is, in the case of infringements of the rules being encountered, to allow the citizen to have the right to remove the vehicle from a Member State without payment of tax. The third is simply to bring the whole piece of legislation firmly into accordance with Article 95 of the Treaty.
The most important message that I have for the House tonight is that we must stop Member States circumventing internal market legislation and abusing the spirit of the internal market by applying new names to old taxes. This legislation will secure freedom of movement for cars and citizens in the single market, it will help car hire firms whose cross-border rental operations have been penalized by allowing better fleet management, and help the consumer by reducing car rental taxes. Our colleague Mr Sindal spoke in the last debate of the importance of tackling transfrontier taxes. This is a small step in that direction.
In conclusion, there are only two certainties in this world: death and taxes. The grim reaper strikes only once. This proposal aims to make sure that the same is true of the tax man.

Caudron
Mr President, Commissioner, ladies and gentlemen, at first glance Mr Watson's report may seem rather technical. You only have to look at the small number of speakers to be convinced of this. However, once this first sensation has passed, you very quickly realize that it touches upon an essential issue for the construction of Europe: the free movement of goods and people and the consequences of certain tax restrictions on this.
Indeed, when border formalities were removed on 1 January 1993, many Member States invented new taxes, particularly for motor cars. These new deductions institute a de facto double taxation which is completely against our principles. I therefore welcome with a great deal of satisfaction the proposals in Mr Watson's report. In fact, it was important to legislate on such a sensitive subject and, similarly, to do all within our power to remove the final restrictions on freedom of movement. I would like to congratulate the rapporteur warmly. I would add that it would have been absurd to debate tonight, on the one hand, the need for harmonization of fiscal policy at a Union level whilst on the other to continue to accept taxes which are in contradiction with one of the driving forces and principles of the construction of Europe.
Nevertheless, although I am pleased with the text, I am forced to wonder once more about the fact that it always seems easier to reach an agreement on material goods than on people and the taxation of people. In fact, Commissioner, over the last few weeks I have had a number of problems of double taxation affecting employees referred to me, and these employees came to me so that I might intervene to help them get out of absurd and often difficult situations. Tomorrow, when we vote on the Watson report, these dozens of cases will leave me with a bitter taste in my mouth, in spite of the responses the Commission has given me with regard to these dossiers. They are far from being solved.
Ladies and gentlemen, Europe is progressing and I am pleased at this, but I cannot help thinking that, sometimes, its construction is being achieved the wrong way round. Although, following this directive and our report, goods transportation will be carried out with increasingly fewer restrictions, the same cannot be said for the movement of people. In fact it remains difficult, and I wanted to say this this evening, to be able to work freely wherever work can be found - and that, in itself, is not easy - and this is in spite of Treaties signed and ratified, and directives. It is truly a shame, if not downright upsetting.

Thyssen
Mr President, this proposal for a directive is another step towards our goal of free movement of persons. In that sense it is surely a link in the further expansion of the European Union. However, I agree with Mr Caudron that there is still much to be accomplished in that area. Although border formalities when importing cars following a change in residence or for temporary use in another Member State were abolished in January 1993, quite a few Member States have been ingenious enough to replace the border formalities and the accompanying taxes which were dropped with some form of registration tax. This creativity by the Member States is finally getting a suitable response. Promoting the mobility of persons in the European Union, while at the same time preventing mobile people, accompanied by their beloved car, from taking up residence elsewhere unless they pay an additional tax levy, can no longer be justified. The Commission's proposal rightly limits these practices, which often boil down to no more than double taxation.
My group, Mr President, is fully in agreement with the proposal for a directive, with regard to the basic problem as well as to the solutions found. We will therefore support the proposal. We have not tabled any amendments ourselves, but we will support the amendments tabled by the rapporteur on which we unanimously agreed in the Committee on Economic and Monetary Affairs and Industrial Policy. The amendments by the rapporteur render the proposal more explicit in three areas and therefore contribute to clarity and increased legal security. Who could be against that?
Mr President, I agree with the proposal but I would add this: I hope that the Italians -I do not know if you are a football fan, Commissioner - I hope that the Italians will be just as successful tonight in their match against Cameroon as you have been tonight in the match in this Parliament.

Monti
Mr President, ladies and gentlemen, I am very sensitive to the remark made by Mr Thyssen and believe that we are faced with a case of harmful competition between television programmes and debate in the House, a debate on very important issues like the one dealt with in the report by Mr Watson whom I would like to thank and congratulate for his document and for the conclusions reached.
Mr Watson welcomed the Commission document as a logical and sensible proposal - it is always nice to hear these words - that should allow the Union's citizens freer movement. According to the Commission, this proposal is an important step forward towards a single market for the owners and users of private vehicles. Its adoption will help solve problems that can crop up for people who change their domicile from one Member State to another or who temporarily want to use a vehicle registered in their country of origin in another Member State.
As far as Amendments Nos 1 and 2 are concerned, I fully agree on the content. The Commission is in fact grateful for these suggestions and will do all it can to get them adopted.
As for Amendment No 3, which is suggested in Article 11 of the proposal, I would just like to point out that Article 95 of the Treaty is already in itself directly applicable to all national legislation and does not need any additional clarification. The direct effectiveness of Article 95 of the Treaty is upheld by what are now consolidated rulings by the Court of Justice and therefore, for this reason, I am sorry that the Commission cannot accept the amendment. Secondly, the content of Article 11 of the proposal would not be amended by the insertion of a reference to Article 95. For this reason, the point of such an amendment also appears debatable.
Again I congratulate the rapporteur and thank you, Mr President.

President
Thank you, Commissioner. You may be pleased to know that our service department has just informed us that Italy is leading 1-0 - as Commissioner Bangemann will now confirm.
The debate is closed.
The vote will take place tomorrow at 12.00 noon.

Mobile and wireless communications
President
The next item is the report (A4-0221/98) by Mr Camisón Asensio on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy on the proposal for a European Parliament and Council Decision on the coordinated introduction of mobile and wireless communications (UMTS) in the Community (COM(98)0058 - C4-0144/98-98/0051(COD)).

Camisón Asensio
Mr President, in its resolution of 29 January 1998 on the third generation of mobile communications, this Parliament clearly demonstrated its emphatic support for this extremely interesting project, which concerns nothing less than the nervous system of the global village of the 21st century.
It was undeniably a political impulse and a commitment - which we are hoping will now be renewed - before the proposal for a decision which we are debating today. Our 11 amendments have the same objective and they were approved almost unanimously in the Committee on Economic and Monetary Affairs and Industrial Policy. It would also seem logical to capitalize on the success of GSM to secure a leading position for Europe in advanced technologies and on the international markets.
To achieve this, we hoped for mutual collaboration, including the sector of industry involved as well as the public authorities, in a sincere attempt to overcome individual preferences so as to achieve a model of open networks and technologies, getting away from proprietary designs aimed at controlling captive markets which would, in the end, be unable to compete on the world market.
Given the lack of time, I would like to mention the following aspects. The ETSI has already made substantial progress in the standardization process, and rival equipment technologies have been combined. Although a great deal still remains to be done, we hope that the speed of technological progress in the industry is such that the first commercial services may be available by 2002.
It is therefore time to initiate the licensing process, so as to give operators and manufacturers the indispensable legal certainty they need to initiate the sizeable investments that are required. The draft decision establishes the necessary guidelines in line with the directive on licences as well as in cooperation with the CEPT.
In short, Commissioner, we are satisfied with this proposal and we believe that it is perfectly legitimate not to reserve access to UMTS licences to present GSM/DCS operators, nor to exclude them in principle. The proposal does not address selection criteria for licences or the pricing of the licensed frequency spectrum - which is not its purpose anyway - because the freedom of the Member States must be respected in this field.
We are advocating the need for sufficient coverage in less populated areas. The Commission should be given a higher profile for international negotiations, while respecting the Member States' rights in the field of spectrum management.
We hope that the Council will take a favourable position, thus allowing this decision to be adopted without delay, since we are involved in a global battle of the utmost urgency, and we must always remember this.
As regards the amendments tabled, I have only two points to make: firstly, there is no serious scientific study highlighting the danger of using earpieces for mobile communications, and it would thus be inappropriate to raise any unnecessary social alarm; and secondly, we must not forget that we are talking about a sector - European telecommunications - which is completely liberalized.
I would like to end with a warning. The next World Radiocommunication Conference - WRC 99 - will take place in the second half of next year. At global level, many applications from the radiocommunications sector compete to use the scarce resource of the radio spectrum; they are applications which are of paramount importance for the economy, for consumers and even for peoples' security. At the WRC, legally binding decisions will be adopted which may also affect broadband mobile services, that is, the UMTS sector.
At the WRC, the Member States of the European Union negotiate on their own behalf by way of coordination with 28 other European countries. There is an obvious need to establish common European positions in this situation, and it is therefore time to harmonize European positions for the WRC. I hope, Commissioner, that this has not been forgotten.

Malerba
Mr President, Commissioner, the European Commission's proposal to introduce UMTS in Europe concerns an extremely important technological development in mobile telephony, one of the fastest growing markets, a sector in which Europe has been able to gain a competitive edge using the common GSM standard before the United States. But on the UMTS standard, greater global convergence has been achieved than on GSM and American operators in particular are expected to rapidly adopt this technology, and will therefore be competing in this area from the very start.
With the arrival of this standard, the European industry could therefore lose the sharp competitive edge that it had with GSM; moreover, the idea of delaying the introduction of UMTS would be entirely detrimental to the European industry, in that it would lag behind in this competition.
We therefore fully agree with the Commission's proposal and with a rapid timetable to introduce new services and we in the Committee on Research, Technological Development and Energy encourage investment in the development of terminals that comply with the new standard.
Two points are of great concern to me, and they are the subject of amendments that the rapporteur has received. The first point is non-discrimination between competing operators when all the frequencies of the 900, 1800 and 1900 MHz range are being allocated, to allow these operators to offer services via GSM or UMTS, guaranteeing coverage of both urban and rural areas in a situation of fair competition. The second point is political support for the Commission so that it can spur Member States on to reallocate and make available new frequencies for UMTS services.

van Velzen, W.G.
Mr President, Commissioner, ladies and gentlemen, I would like to express my appreciation to Mr Camisón Asensio and the European Commission for their constructive approach to this subject. The Commission, and in particular the Commissioner, have set to work energetically and have managed to get the industry as a whole to agree to a European standard for UMTS. Hopefully, this will enable Europe to lead the world in the area of mobile telephone systems. The rise of the mobile telephone is impressive. UMTS offers Europe the opportunity to repeat the success achieved with GSM. UMTS offers many multimedia adaptations and applications and, in fact, spells the end of the traditional telephone. In addition, the development of this system may create a large number of jobs. Success is, however, only possible if the licensing system and the availability of frequencies are clear at an early stage. In this context, I would like to make two points.
Mr President, it is very important that great care be exercised with the selection of an allocation mechanism for the scarce frequencies which will be made available for UMTS. To this effect, I have submitted a written request to the Commission to start an investigation of the best allocation mechanism. I believe that Commissioner Bangemann has already promised to contribute to such an investigation in the Committee on Economic and Monetary Affairs and Industrial Policy. I would ask the Commissioner whether he can now confirm that he will, in fact, conduct this investigation. A number of Member States, including the Netherlands, are preparing to set up an auction for UMTS. I would be grateful if the Commissioner could tell me when we can expect the result of the investigation, because I consider it important that the results are available before Member States decide on their selection of an allocation mechanism.
Mr President, in addition to the selection of the allocation mechanism - and this is my second point - it is very important, as Mr Malerba has said, that the Member States strictly adhere to the principles of transparency and non-discrimination in the allocation of the UMTS frequencies. We must avoid a situation where operators who are awarded a UMTS licence at this stage are denied the possibility of using GSM and DCS frequencies for UMTS services. Such a prohibition only serves to drive up the market price of frequencies and flies in the face of the principle of spectrum efficiency. An amendment to this effect was approved by the Committee on Economic and Monetary Affairs and Industrial Policy in this Parliament with a large majority. I should like to hear from the Commissioner which measures he intends to take against Member States who do not adhere to the principle of non-discrimination and who still impose such a ban.
Mr President, UMTS will become very important for Europe in the future. But the emergency number 112 is now also very important for the citizen; the use of the emergency number 112 in the entire European Union should have been introduced a long time ago. I have pointed this out many times and I submitted a written question on 22 October of last year, a question which was repeated later in the House. I would be grateful if the Commissioner could throw light on the following three points. Which Member States have not introduced or activated the 112 emergency number and why have they not done so? Secondly, which steps and actions will be taken by the Commissioner to ensure that the Member States comply with this obligation? Thirdly, does the Commissioner not think it is useful if at least the staff manning the emergency switchboards can communicate in the three languages which must be spoken for the users of 112 in the respective Member State? I would appreciate it if the Commissioner could provide an answer to these questions.

Thors
Mr President, the GSM system has given European producers a world-leading position and made it possible for the EU countries to build a comprehensive mobile telephone network. It has limitations. For example, it cannot handle the high-speed transfer of multimedia required for the Internet via mobile telephones, as shown here. Hence UMTS.
It is important for both the EU and the Member States to play an active role in promoting the development of the new system so that it becomes just as big a success for Europe as GSM. It will certainly take several years before the first of the new services reaches the market, but, as the Commission says, it is quite right for us to lay down the legal framework now so that the enormous investment required for the development - a greater investment than ever before - can be made.
We know it is important for the Member States to adopt a common standard and to be able to act jointly at the next meeting to be held by International Telecommunications Union this autumn, at which the decision is going to be made. The Commission does not have a vote there. The USA may perhaps present four standards which will lead to a split in their market. We need a single standard to have the same kind of opportunities throughout the Union.
A fair amount has been said about licensing. I hope other countries will be able to do the same as the UK, which is setting a good example, and will think about starting to grant licences soon so that we actually achieve the target of bringing the new system into service no later than the year 2002, in accordance with the Commission's timetable. The granting of licences has also been debated here today. I think it is important to look at which consortia want to ask for a licence and not accept those who lack credit and opportunities to develop. Instead we should be able to oversee a royalty system which gradually gives them the ability to pay.
The open process, which has been highlighted here, is also important. If we have one standard, we can then share the patent. We need a competition for the best applications. In this way the consumers will gain access to new services and new products.

Rübig
Mr President, Commissioner Bangemann, ladies and gentlemen, how often in the past have we spoken of revolutionary developments in relation to telecommunications? As so often before, this also applies to the changes we can expect in wireless and mobile telecommunications. UMTS not only provides data rates of up to 2 MB per second and ISDN standard speech quality. It also creates a whole new market for mobile multi-media services.
However, we must look carefully at the various success factors. The necessary frequency spectrums must be distributed sensibly amongst the network operators. The total technical cost of UMTS involves high investment costs, but we all want the end price for the customer to be as attractive as possible. For this reason we must endeavour to keep the cost of licence fees, regulations and other costs as low as possible. If we do not, we will be unable to achieve satisfactory market conditions in Europe and will put ourselves at an enormous competitive disadvantage in the medium term.
However, let us consider competition on a global scale. In Japan, the first preliminary stages of UMTS will go into operation at the end of 1999. If these preliminary stages go on to become de facto standards, network operators in the single market will have to adopt them. We must at all costs counter this threat with our own activities.
On the other hand, as Mr Camisón Asensio says in his report, Europe is capable of taking both the technological and the strategic lead in this area. Our advantage lies in our experience of collaboration on matters of standardization, which should serve us as a model for other areas of technical legislation - here I am thinking of the bus directive.

Bangemann
Mr President, first of all let me express our thanks to the rapporteur. Working with him we have, in a very short period of time, been able to prepare a very important measure. This has essentially been achieved jointly and on the basis of the same fundamental principles. I also believe that the discussion today has shown that there is no difference in the positions held by Parliament and the Commission on these fundamental issues.
I should also like to remind Parliament that a good six months ago, when we last dealt with UMTS, we were still awaiting a decision from the ETSI and the situation was very unclear - to say the least. It has, however, proved possible to draw up this new standard for the third generation of mobile communications within a relatively short period of time and with the broad consensus of all the parties involved. This represents a considerable success and one which should not be underestimated.
During these six months we have arrived at the necessary legal guarantees and I believe that we will now be able to move on to commercialisation very quickly. Of course, this stage is clearly not dependent on measures determined by political authorities. On the contrary, it is up to commercial operators to play their part. I have absolutely no doubt, however, that European industry will again be able to achieve the lead it has now with GSM, not only in the European market, but worldwide.
We agree on that. We have also had the occasion to discuss some individual issues. For this reason, I want to go into these individual questions in greater detail and to state once again that we are unable to accept all the amendments. This is partly because certain amendments either repeat or pick up issues, such as health protection, which have already been dealt with in sufficient detail elsewhere and do not need to be revisited in relation to the legal guarantees for UMTS.
We are, nevertheless, accepting seven amendments unchanged, Nos 1, 2, 3, 5, 8, 9 and 11, along with Amendment No 7 in principle and Amendment No 6 in part. We are unable to accept the other six amendments but, as I have already said, they tend to relate to individual questions.
So, let us move on to these individual questions which Mr van Velzen has once again asked. It is always a pleasure to answer these questions. That is presumably why he likes to ask them several times. I have already dealt with them in committee and on other occasions. I am, however, quite happy to go over them again today.
As far as the increase in frequencies is concerned, as I remarked recently in the Committee on Economic and Monetary Affairs and Industrial Policy, it is simply a matter of method and of course we have already gathered, and will continue to gather, relevant experiences. There is no need to commission a study and we will soon be suggesting, in a statement to Parliament, how the various options available can be used to develop a sensible frequency policy.
We are also completely aware, Mr Malerba, that we need to pay great attention to the Radio Conferences. The last conference was an improvement on its predecessor, and I am sure that next year's conference will produce an even greater consensus between the Member States and the Commission and therefore provide us with access to valuable resources.
With regard to Amendment No 7, which - to answer another of the points raised by Mr van Velzen - relates to Article 3 Para. 4, we can give our agreement in principle. It is one of the list I have already given you. However, we would like add the words "in compliance with the Community legislation in force' in order to point up the link with current legislation, in particular the Directive on authorizations and the Directive on competition in mobile telecommunications.
In Amendment No 6, which we can accept in part, the same applies to the reference to Community legislation currently in force. However, we have taken the view that there is no need for a specific reference to the principles of transparency and nondiscrimination as this is clearly an integral part of Community legislation. Sometimes things can be overstated. It doesn't make things clearer.
I have also already answered the question on emergency numbers and their implementation, Mr van Velzen. With one eye on the time, and given the discussion which is to follow, let me suggest the following. I have already said all this to you before and I hope you will agree that there is no point in my repeating it again here. Or would you like me to do that? I can, I do not have a problem with that, but it strikes me as perhaps being a waste of time.
So, I have dealt with the most important questions which were asked. Finally, a few closing words on our draft. It occurs to me, Mr Rübig, that there is no danger that either we or companies working in Europe may be forced to adapt to Japanese standards. Rather the other way around! All the Japanese standards we know about at the moment, and the reactions from the MITI Ministry and the Ministry of Post and Telecommunications, indicate that Japan is likely to adopt the standards chosen either by us or by the ETSI. This is, in part, due to the fact that in drafting these standards we were able to work together with Japanese and US firms, and so in its approach the document is actually far more than a European standard.
So, as you can see, we have a good chance of not only repeating the success of GSM, but perhaps even of surpassing it. In further discussions, in particular with US industry and the US administration, we will stress the fact that UMTS is not a mandatory standard proposed by the Commission or by Parliament and the Council but, as ever, an industry-devised standard in our usual tradition. It is a standard which anyone can adopt, but no-one is forced to adopt. However, in the interests of consumers and in the interests of creating as uniform a market as possible - and thereby above all reasonable prices -, we must persuade the various political wills that a standard of this kind will achieve the scope of influence it deserves. That means that everyone is invited to use it and therefore everyone has to be convinced of its advantages in order to use it. It is this positive policy which has allowed us to make good progress in this area so far and I would like to take this opportunity to thank Parliament for its support.

Rübig
Mr Commissioner, can you guarantee that we will be able to start the licensing process next year?

Bangemann
That, of course, depends on whether we receive any applications, which will not necessarily be the case. If we do, and if we have agreed this draft, there are no further legal obstacles.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 12.00 noon.

Transport of nuclear waste
President
The next item is the statement by the Commission on transport of nuclear waste in the European Union.

Oreja
Mr President, ladies and gentlemen, on 30 April the Commission received information from the French authorities indicating that a significant number of cases had been registered in which fuel casks being transported to the reprocessing plant at la Hague, France exceeded the limit of 4 becquerels per square centimetre for unfixed beta gamma contamination.
Given that some of the fuel casks concerned came from German nuclear power plants, more detailed studies were urgently launched, not only in France but also in Germany.
The Commission has remained in contact with the relevant French and German authorities, in order to monitor the results of these studies which have not yet been competed. It must be recognized that Member States have primary responsibility for the implementation of Community directives and that the Commission would only consider intervening to fulfill its role as guardian of the Treaties in the hypothetical situation where a Member State failed to take the measures dictated by this responsibility.
The first measure taken by the relevant authorities when the current situation became known consisted of immediately suspending the transport of irradiated fuel from nuclear plants, whilst awaiting a complete study of the situation and the adoption of additional and appropriate safety measures to guarantee the correct application of European legislation at a national level.
It clearly emerges from the results which are currently available that neither staff nor the population were subjected to exposure to radiation in excess of the limits set at Community level. In fact, any exposure resulting from the excess contamination of the flasks corresponded to no more than a fraction of the current limits.
It can be concluded that the relevant authorities of the Member States acted responsibly in order to rectify the situation as soon as the problems were identified. The Commission remains in contact with the Member States concerned. Furthermore, the issue was discussed at a meeting of the Permanent Working Group on the Safety of Transportation of Radioactive Substances, on 18 May and lessons to be drawn from their analysis of the situation have been passed on to the relevant authorities of the Member States.
At the current stage, the Commission proposes no further immediate measures. Nevertheless, as has already been noted, measures aimed at assuring the correct application of European Union legislation are still being studied by the Member States concerned. Furthermore, the Commission is concerned about the circumstances which were at the origin of the situation observed, even if corrective measures seem to have been implemented promptly.
Consequently, when the full results of the inquiries at national level have been communicated to the Commission, it envisages an impartial overall study of the situation not only in France and Germany but in all the Member States likely to be affected.

Lange
Mr President, Commissioner, the public has in fact just recently learnt that we are not the only ones who sweat working here, but that flasks sweat too. These sweating flasks actually put people's lives at risk. You have said that there is no risk. That is not quite true. If the hot spots where this sweat concentrates come into contact with the human body, these people are at risk. Some of them work on these flasks and others watch over them. Not that they sweat because they are being watched. So there is a real risk.
What is remarkable in this whole story, however, is that the public has only just found out about these sweating flasks, while the people who operate the flasks have known about it for a long time and have been measuring the sweating for a long time. So now let me put the question to you, Mr Commissioner. You must know something! You have a standing working group. You discuss transport matters. It is a close community with its ear to the ground. I can imagine many scenarios, but it is really possible that no one knew anything about the measurements these operators were taking? Or the fact that COGEMA had additional facilities built to clean the returned material in advance? Was the Commission really unaware of all this? No, maybe you do not know anything! The whole thing is quite inconceivable.
For this reason I should like to know in greater detail exactly what the Commission knew and when. Looking at your new statement on the work of this standing working group, it says very vaguely that there was no risk because these incidents and accidents were few in number and limited in consequence. Please, exactly what accidents and incidents happened with the flasks? This is where I think the vital security leak lies. There were obviously some people who knew something but chose not to share this knowledge with the public.
Then, of course, I have a much more specific question. If such knowledge was available, what did the politicians responsible do with it? Did they knowingly deny this knowledge? And what conclusions should they now draw? You cannot simply act as if the Commission suddenly received this knowledge in May like a bolt from the blue!
As for the industry, it is not just because certain best-sellers are doing big business at the moment that I should quote Lenin, but the motto "confidence is good, control is better' seems very apt in this case with the hushing up of security problems and accidents, particularly in the nuclear industry, so topical. As far as I can see, at the moment the nuclear industry, which has known about these sweating flasks for years, is no longer a reliable source of information. I urge the Commission to make sure that if there is to be cross-border transportation of radioactive waste, that checks, uniform standards and a reporting duty should be introduced.
At the end of the day this is just another example of the fact that there is no absolutely safe final storage for nuclear waste. It is simply pushed back and forth across borders. I urge the Commission to act in the interests of the citizens of Europe and not to become an accomplice of the nuclear industry, trying to make energy policy against the will of the majority of the population of Europe. It makes for a shaky structure, a colossus built on shaky foundations. This is the reason I simply cannot understand why your statement, from which I have just quoted, states in this important area that the question of security is discussed not from the point of view of risks or the concerns of the population, but simply in terms of how we can gain greater acceptance. No, the Commission must serve its citizens and not individual industries.

Chichester
Allow me to try to cool matters down a little bit. I welcome this statement from the Commissioner. We are dealing with an industry which is very highly regulated, one of most regulated industries in Europe, and we must take cognizance of the fact that contrary to what my colleague suggested, the containment in these flasks was not breached. We are talking about a minor degree of surface contamination, and I urge that we do not let this matter get out of proportion. In stirring up concern, we exacerbate the public's fears about these matters unreasonably and excessively. It is true that if an industry is highly regulated, it has a duty to inform the public, as well as the authorities, and arguably it should be like Caesar's wife, that is to say, quite beyond reproach, and should take all steps to inform people of the situation.
My understanding is that there has been some expression of regret and contrition on the part of the utilities in Germany and the transport organization. Although, as I understand it, they did not breach the disclosure requirements, because the levels of contamination were not that great - and I welcome the Commissioner making that point - nevertheless it would have been better if all information had been made public because more information, not less, is better for restoring and establishing public confidence in the nuclear industry.
I would like to point to the BNFL establishment at Sellafield in the UK, as an industry which has gone out of its way to take the point of transparency and openness to the degree of turning their facility at Sellafield into a tourist attraction. That seems to me to be quite an achievement and a step in the right direction.
The real question here is: was there any danger to the public? No. Was there any danger to the operators and the staff involved? I think not. Are there lessons to be learned? Yes - there needs to be more openness. That is a useful outcome of this exercise. But above all, let us not go overboard in sounding alarmist about this. Other industries have far worse instances of difficulty which do not get the same attention as anything to do with the word 'nuclear' . I think that is regrettable. So I welcome the statement and hope we will not let matters get out of proportion.

Eisma
Mr President, I consider Commissioner Oreja's reply to be very unsatisfactory. He says that we will not take any additional measures at present, while two Member States, France and Germany, have announced a total ban on the transportation of nuclear waste. The response of the Commission is not to do anything at all, although there are 13 other Member States, some of which face similar problems. Just look at all the questions we ask in the present joint resolution. I will not list all our questions to the Commission about improving the situation because this would take more time than I have been allocated. But you could take a look at paragraphs 4, 7, 8, 11 and so on. We would really like a response from the Commission on these matters. Could we have some answers please? These are questions where we ask the Commission in a joint resolution to tackle the problem.
I must say that it is scandalous that so little information has been released about this transport and the health risks it entails. I stated above that two Member States have halted the transport. The Netherlands should do likewise because it has suddenly come to light that the power stations in Borselen and Dodewaard, located in my own country, have also shipped their waste to La Hague and Sellafield, with similar risks. The containers in which the nuclear waste is shipped have been shown to have excessively high levels of radiation and contamination. The transport in my own country of the Netherlands should also be halted for as long as this situation remains unclear. But even this is not enough, Mr President, because it is very frightening that such matters have been concealed. More openness and control with respect to nuclear transport is therefore of the utmost importance. The Commission must present a plan and submit it to our committee as soon as possible. According to German law, the seabed off Sellafield, with its nuclear waste, and even the pigeons around the reprocessing plant, must be classified as "contaminated with radioactive waste' . This debate seems long overdue.

Fitzsimons
Mr President, I cannot speak about the transportation of nuclear waste without speaking about Sellafield, which Mr Chichester has mentioned. The daily discharges from the nuclear plant at Sellafield are now estimated at nine million tonnes of nuclear waste. The recent application by BNFL to the British Government for increased area discharges is another unpleasant episode in the ongoing saga of Sellafield and Thorp nuclear plants.
I find comments made this week in Dublin by a scientist Dr Sue Lon - who is BNFL's director of operations and technology - that the UK has a safety record which would bear up to the closest scrutiny rather sickening. If BNFL had such a blue chip record in the field of public health and public safety why do lobsters along some parts of the east coast have levels of contamination 247 times greater than was the case only in 1993? May I tell the experts that Mr Chichester has mentioned, who say the industry is highly regulated, that the Titanic was the most highly regulated ship in the world and it sank. If Sellafield sinks we will all sink with it. If the British nuclear industry is such a model profession, why do BNFL not agree to allow the European Commission independently to evaluate its operations and the powers which derive under the EURATOM Treaty? The comments of that BNFL director are verging on the extraordinary.
In the light of the fact that the Dounreay nuclear plant is now being closed because of the public health risks to the operations being carried out there, the Irish Sea must not be used as a dumping ground for nuclear waste materials from the Sellafield plant. Undisputed statistics clearly demonstrate, since the setting up of the Thorp plant, wholesale increases in the amount of nuclear materials found in concentrations in seaweed in Ireland. This was observed by the radiological protection institute in Ireland in 1994, exactly one year after the British granted BNFL the licence, which is responsible for the environmental mess that we now have on our hands.

Seppänen
Mr President, I notice that the previous speaker has learnt to read, but has not learnt to stop reading.
We have only recently had proof of how Pakistan and India, through smuggling, fraud, theft and bribery have obtained the means to manufacture a nuclear bomb. I do not claim that a nuclear power plant is an atomic bomb, but the nuclear power lobby in Europe engages in that same secrecy and lying in public that has characterized the behaviour of states with newly-acquired nuclear arsenals. I would hope that the citizens of Europe can trust those who use nuclear power plants to the extent that nuclear power poses no danger to them.
The main problem is that nuclear plants produce spent fuel. That is the end product, and there is nowhere to dump it. For that reason, it has to be transported to and fro, and it is quite possible that all Europe's nuclear waste has now ended up being dumped in the wrong place and that it will all have to be moved yet again. That is why urgent measures are required of the Commission to enable the gradual construction of final nuclear waste sites.

Bloch von Blottnitz
Mr President, the Commission would have done itself a favour if it had read its own papers, in particular the paper dated 3 April 1996, Commission, No 11. Because it states, word for word, that the outside of the packaging - referred to as a "fuel transport container' causes contamination in water. You have known this since 1996, and now you stand there in front of us acting dumb and claiming you have only known since April! Incidentally, there is also a working paper No 4 from Technical Committee 996 6 96 which makes detailed proposals on this subject which have been included in the safety series produced by the AIO with whom you also work closely.
So, if you're trying to tell us now that the limit values were only slightly exceeded, I have to ask you whether you think we are absolutely stupid. The limit values are 4 becquerels/cm2 and we are looking at recorded contamination levels of 50, 000 becquerels. The only reason you have waited so long is that you were hoping the industry would solve the problem. Except that the contamination has kept on increasing. It has not dropped, it has increased year on year. That is my first point.
Secondly, it has yet to be established whether contamination occurs whilst the water basin is being loaded. Because the water basin must contain isotopes other than cobalt and caesium. Until now, however, we have only found cobalt and caesium. So what has happened to the other isotopes? The cause may actually be quite different, they just have not yet been established or even researched yet.
Then, to refresh your memory, I should like to quote you something from the Euratom Directive, namely Article 2 of Directive 92/3/Euratom. It says quite explicitly, "The transport processes required for delivery must adhere to the provisions laid down by the Community and by the individual Member States and must be in compliance with the international agreements on the transport of radioactive materials.' If this is so, then the reverse must also be the case: if the authorities in question are unable to control things at national level - and you have been quite aware of that for years - then you too must perform your regulatory duties. You are the guardians of the law. As is it, the only reason this whole scandal has been revealed is because of an indiscretion, not because you were looking into it. That is the real scandal of the matter. Now to play that down and on top of everything else to say that the transport workers or the convoy staff were not exposed to any risk is just another example of your treating the public as fools. But everyone knows quite well that even if you are carrying a dosage meter it obviously cannot show anything if it is an alpha emitter! But if it is swept down through the air from a transport container, for example, and the poor policeman who is driving alongside or the transport worker gets it, then he can obviously suffer from serious radiation damage. But he can never prove it later! So my question to you is what conclusions are you drawing from this? Are you finally going to give us access to the minutes of the standing working group and the studies which have been paid for over the years with money from EC coffers? Are we finally going to get to see these studies? It is now vital that the reliability of the operators is tested, because authorization to operate nuclear power plants is always linked to this reliability. And this reliability can no longer be taken for granted. You should have revoked their authorizations a long time ago. Those are the facts. And everything else you are trying to tell us is inaccurate. You just have to read your own papers!

Lukas
Mr President, the question of the safety of Europe's citizens in relation to nuclear waste transport is obviously of great importance. However, the subject can only be dealt with as one detail of a more complex overall issue which deserves our most serious attention. Until the question of intermediate and final storage has been settled, all matters relating to the commissioning of new nuclear power stations and the re-commissioning of old plants must be rejected out of hand. As we see it, the European Union should do everything in its power to effect a complete withdrawal from nuclear power and, to this end, should promote alternative sources of energy to a much greater extent.
The European Union had an opportunity to treat this matter as a model. The safety or otherwise of nuclear waste transport is nothing more than the treatment of a symptom of unsafe development. It is important. But it would be even more important if we could treat the root of the problem and stop all further development of nuclear energy.

Morris
I would like to say to Mr Chichester that in Britain Caesar's wife has been putting it about a little bit! Dounreay has been closed by the nuclear inspectorate. We have in Sellafield a situation I can only describe by saying that we are expecting a spectacular nuclear orgasm any time now because there is in that place a pit which it is suspected may explode at any time.
However, I think this debate today timely, against the background of the situation in Germany, where rail workers, policemen and even protesters against nuclear issues have been irradiated. In fact the situation was so serious in Germany that the head of the German police force was threatening to bring charges of causing serious bodily harm against the German Ministry of the Environment as well as the management of the German nuclear power stations. These workers were exposed to radiation levels three thousand times above the permitted levels. The flasks were unsafe and inadequately tested. Last year one quarter of the flasks sent by rail from Germany to France had not been properly cleaned and were thoroughly contaminated. This has been going on for something like 13 years.
Of course this is only possible in an industry like the nuclear industry which is protected and shrouded by secrecy. It is almost impossible to monitor and call to account the movement of radioactive material. The industry has known about radioactive contamination in transport to the UK and France since 1980. The industry was aware of the dodgy and unsafe fittings of the casks and I am given to understand that the smaller casks, which were transported to Sellafield had never been tested for their effectiveness, safety and efficiency.
Can I say something that I hope the Commission will take note of. This material must be processed and stored, not at the point of delivery far away in Scotland or in England, but stored and processed as near as possible to the point of production. Can I also say to the Commission that they now need to take on board the seriousness of this issue? We will get another chance to do that when we debate the transport of nuclear material, when the Commission sees fit to bring their report to the Transport Committee.

Rübig
Mr President, Commissioner, ladies and gentlemen, we must ensure that legislation - both European and international - is implemented correctly. Objective testing and transparency must be guaranteed immediately and where abuse occurs, legal measures must be taken immediately. Mr Lange has already mentioned Lenin. I believe that we must turn our attention to eastern Europe and endeavour to implement safety standards there as quickly as possible. That is why we must establish joint safety standards in Europe on the broadest possible basis immediately and strengthen our information policy significantly.

Graenitz
Mr President, Commissioner, as I listened to your explanations, I remembered how last year President Santer, full of enthusiasm, stood in this place and shouted out the words, "Let us make this Union a Union of health.' But the protection of the people of Europe's health has been neglected when it comes to transporting nuclear waste. If this were not the case, transport workers, convoy staff and even people protesting against the transport would not have been exposed to radiation. It should also be remembered that these consignments are merely in transit; there is still no final place of storage for nuclear waste. The research goes on, but we have yet to find a solution.
We do not only need, we must also implement uniform security regulations, Mr Chichester, because when Caesar said that his wife should be beyond reproach, he was in fact announcing his divorce because his wife had hidden from him things that had happened in his own house. And that is just the point! It is unacceptable that things should be hidden from people, that the Commission, the companies and the Member States do not have free access to all information so that they can pass it on to the public.
A number of Member States have refused to use nuclear energy as a source of electricity. However, the consignments pass through these countries too, because often there is no way round it in Europe for geographical reasons. I see no reason why people should be exposed to this risk and believe that the funds we so generously spend on Euratom should finally be used to draw up a set of safety regulations which would then apply to all Member States and all new applicants for membership in order to guarantee safety in Europe. For security cannot be parcelled out, and we cannot keep pushing the blame back and forth from one side to the other.

Bowe
Mr President, we are really here tonight to comment about the nuclear industry, but having heard the Commission's initial response it is fair to say that it is not adequate and is certainly lacking in seriousness and complacent. We really need more from the Commission when we get incidents like this.
These recent revelations of these high levels of radiation found in casks and rolling stock used to ship nuclear waste are unfortunately yet another example of the nuclear industry shooting itself in the foot. When are they ever going to learn? Fragile public confidence in the technical competence and responsible care exercised by the industry is once again evaporating into thin air. When will the industry learn that in order to maintain public confidence and support and to have any hope of operating in future they must operate to the highest safety standards with a diligence and zeal second to none?
It is my personal opinion that if the industry wants to have a long-term future in a stable legislative and economic environment it must learn the lessons of the past and conduct itself in an open and transparent manner with the highest concern for public safety. Some of the resolutions, I have to say, are an overreaction to the latest incidents, which, technically I do not think are as serious as some people have made out. I must admit, though, that I did enjoy Mrs Bloch von Blottnitz's intervention!
There are some lessons that have to be learned. The lessons can be found in those resolutions that we see tonight. First of all there has to be an urgent public investigation: that is absolutely necessary. There has to a prompt remedy to any problems and abuses identified. New standards must be established on a European basis for monitoring, evaluating risks during transportation, and subsequently a new set of uniform operating standards across Europe.
Finally, the Commission and the Member States involved have a responsibility to ensure that action is taken against any guilty parties identified during the investigation. Let us hope that this small straw is the one that breaks the back of a very stubborn and blinkered camel which is the model of the nuclear industry as we see it to day. Finally it might just see the light.

Oreja
Mr President, ladies and gentlemen, allow me to make an initial comment. It was an honour for me to be here today to share with you the Commission's position on the contamination of the irradiated fuel casks.
Mrs Bjerregaard would have very much liked to be here with you - she is the Commissioner responsible for this area - but as you are probably aware, she had an extremely important Council in Luxembourg today, what we call in our idiom a "mega' Transport and Environment Council.
I will briefly reply to a certain number of the points raised, but you can be sure that I will pass on your questions to her tomorrow morning. I have taken note of all the questions you have raised and the way in which they have been formulated. Mrs Bjerregaard will provide you with replies, either written or verbal.
I would first of all like to say to you that the Commission is very sensitive to this problem and that it is entirely in agreement with the statements which have been made by some of you, in particular the last speech made by Mr Bowe, and others such as that of Mr Chichester on the need for greater public information. Reference was made to President Santer's sensitivity with regard to health related aspects. This is indeed one of the Commission's main concerns, and has been since the beginning of its term of office three and a half years ago. So how could we not be sensitive to a problem such as this?
To try to reply to Mr Lange and Mrs Bloch von Blottnitz, I must first of all say that I am not aware of how many times contamination levels have been exceeded at the time of exposure. The levels apply to unfixed contamination, that is, one which can be removed by wiping the surface and thus likely to be transmitted to people in contact with the surface. We have known for some time, however, that contamination which is impossible to remove at the time of shipment can undergo changes through natural processes whilst in transportation, such that on arrival it is no longer fixed. The fuel casks are thus covered during transit to avoid all contact with people and any leaching effect caused by rain.
Furthermore, any reappearance of excess unfixed contamination during transportation must be followed by decontamination as soon as possible after detection. A certain number of cases of this kind are thus to be expected, although I cannot give you an exact figure. However, in this instance, it seems that there was a lack of communication between the operators who detected the contamination and the competent authorities. The latter were thus not fully aware of the extent of the problem raised by the contamination, nor of the possibility that these effects concealed the need for stricter procedures. These aspects must clearly be the subject of further measures, in particular at a national level.
In response to part of the question raised by Mr Lange, I would also like to tell him that a report drawn up in 1985 by the International Atomic Energy Agency explicitly recognizes the possibility of the reappearance of unfixed contamination on the surface of the fuel casks during transit, even when this contamination had been wiped off before shipment. Many of the Member States of the European Union, as well as the Commission, contributed to this report. However, the responsibility for applying Community directives falls primarily on Member States, and the Commission was unaware of the possible extent of the problem of contamination of fuel casks attributable to this phenomenon before being informed of the situation in France by the relevant French authorities on 30 April 1998.
Finally, in reply to a comment by Mr Eisma, I will say to him, as I have already said moreover, that inquiries are still underway in the different Member States. When they are completed, the Commission will very rapidly examine the appropriateness of a more thorough collective study of the situation in the many Member States which are potentially affected.
I will say finally to Mr Fitzsimons that I listened with great interest to his speech, as well as those of Mr Seppänen and others. There are questions which, if I have understood correctly, do not exactly touch upon the problem of transport. I will nevertheless pass them on to Mrs Bjerregarrd, along with the others. With regard to Mr Morris, I will simply say that it clearly emerges from the available results that neither staff nor the population were subjected to radiation exposure above the limits set at Community level and that any exposure resulting from the excess contamination of the fuel casks only corresponds to a small fraction of the current limits.
Mr President, ladies and gentlemen, this is what I am able to tell you today. Allow me finally to insist on the fact that we are particularly sensitive to the problems which have just been raised. As I said, I will immediately pass on your questions to Mrs Bjerregaard, who will be able to give you full answers.

President
I can see that four Members have asked to speak on very brief questions. I would ask the honourable members to consider that Mr Oreja is deputizing for another commissioner and that there will be other opportunities to question the appropriate commissioner.

Bloch von Blottnitz
Mr President, I would just like to ask two questions which I would be grateful if you would pass on to the competent commissioner.
Firstly, when will we receive the minutes of the standing working group? Secondly, will a reporting duty for company transporters and transports at long last be introduced now? This information does not appear in any of the directives. Thirdly, I would just like to say that contamination reaches this high level on arrival, not departure.

Morris
Mr President, a year ago last April we sent back from the Committee on Transport and Tourism a report to the Commission, for consideration also by the Council, on the transport of nuclear material by air. We are still awaiting the return of that report to the Committee. It is an urgent matter and I would therefore request the Commission to make enquiries as to when that report will be presented to the Transport Committee.

Lange
Mr President, when will Parliament have the opportunity of seeing the minutes of the standing working group on nuclear safety if they cannot be delivered to us directly? I would be pleased to come to the Commission on Monday morning to read the minutes there.

Oreja
Yes, certainly. But I am not in a position to give concrete responses and I do not want to give replies which are vague. That is not my role here and would have no meaning.
The respect you deserve as Members of the House prevents me from speaking to you in generalities. However you, and Mr Lange in particular - who asked if he could go and see the minutes of the meetings on Monday - can be assured that no later than tomorrow morning at 9 a.m., Mrs Bjerregaard will be fully informed of all the issues raised here, regarding the minutes of the Permanent Working Group, regarding a directive and so on, and I hope that within 24 hours you will have a reply from Mrs Bjerregaard, one way or another.
Personally, I can give no further detail, out of respect for Parliament and parliamentary Members.

President
I would like to thank you, Commissioner, for appearing before Parliament at such short notice, and for answering so well, considering this is not your field. Please convey the best wishes of the House to Mrs Bjerregaard. On behalf of the Presidency, I would like to add that it is of course important for the management of Parliament to endeavour to arrange the debates in such a way that the appropriate commissioners can be present. This is a self-directed criticism on the part of the Presidency. But once again, thank you, Commissioner, for your willingness to step in.
I have received six motions for resolutions , tabled pursuant to Rule 37 (2), on the agenda.
The debate is closed.
The vote will take place tomorrow at 12.00 noon.
(The sitting was closed at 11.30 p.m.)

