Publication and translation obligations of certain types of companies (debate) 
President
The next item is the report by Mrs P-N. Kauppi, on behalf of the Committee on Legal Affairs, on the proposal for a directive of the European Parliament and of the Council amending Council Directives 68/151/EEC and 89/666/EC as regards publication and translation obligations of certain types of companies - C6-0171/2008 -.
Piia-Noora Kauppi
rapporteur. - Mr President, this report is part of the simplification package on company law. It is very important that in the European Union we try to simplify the environment for companies to flourish and to create growth for the European economy. The aim is to diminish administrative burdens as regards publication and translation obligations of certain types of companies. The proposal is part of the wide-ranging administrative burden reduction exercise; it would free up and redirect business resources and thus enhance the competitiveness of European economies.
Nowadays, under the First Company Law Directive, companies need to publish certain information in the national gazettes that has to be entered into the Member States' commercial registers. In most cases, publication in the national gazette entails additional costs for the companies without providing any real added value. The objective of this proposal is therefore to remove any additional publication requirements in national law that cause additional costs to the companies.
Anyhow, the Commission leaves flexibility for Member States concerning these additional publication requirements. It is still possible for Member States to have additional requirements, but these should be covered by the single fee proposed for the new electronic platform.
Member States should all have electronic platforms containing the full information and providing access to this information in the companies' electronic file in the register. This would be a cost-effective and easily accessible way of providing all the necessary information regarding the companies. Some Member States already have these electronic registers and databases, but others do not have this kind of digital database.
The most important thing is to introduce the single fee set by the Member States that covers all the costs related to the publication and administration requirements. This single fee should also cover any additional national requirements for the publication of information in local and regional newspapers as well.
However, the Committee on Legal Affairs also wanted to introduce some flexibility regarding these costs and we now say that, if there are well-founded reasons, it would be possible for Member States to have additional fees.
Regarding the 11th Company Law Directive, this proposal deals with the translation requirements for documents to be filed in the registers of company branches. When registering a branch, companies also have to file certain information in the register of the company branch. This often leads to significant additional costs for companies as they not only have to ensure the translation of certain documents into the language of the Member States where the branch is situated, but also have to comply with sometimes excessive requirements for certification and/or notarisation of that translation. So now we are trying to ease translation obligations by having this certification and authorisation abolished.
The objective is to reduce the costs for translation and certification to the minimum. This also leads to benefits for companies by achieving a certain reduction in costs while ensuring the reliability of the translations.
I agree with the Commission proposal and tried to keep my wording as close to the Commission proposal as possible. However, it was not possible to reach a consensus based on the Commission proposal here in Parliament.
In the report we introduced some amendments to clarify the practical implementation of the provisions relating to publication costs and translation provisions, and we also introduced some technical amendments in order to ensure correct cross-referencing with the Second Company Law Directive.
The Committee on Legal Affairs introduced three compromise amendments tabled by several colleagues to the effect that these additional publication requirements may be permitted if they are well-grounded, but we put them into recitals - they are not in the articles. I think it is very important that there is a recommendation in the recitals for the Member States to use this flexibility, but we do not call on them to do so. If the Member State feels that its companies really need to have this publication in the national gazette - and this is really something that Member States wants - they can do that, but we have not put any call to this effect into the articles.
The second issue is that I, personally, tried to introduce a transition period, which I still think would be a very good way forward. During the transition period these publication requirements would be there, but once the transition period is over we would have only the electronic database. I think this kind of proposal for a transition period would also be in line with the issue of internet penetration, namely that some Member States have better internet penetration than others; maybe after the transition period we could then make sure that there is enough distribution of information in all Member States. In this way we could take into account the fact that internet penetration in all the Member States is not at the same level.
Charlie McCreevy
Member of the Commission. - Mr President, I would like to thank the rapporteur for her work on this file, which has turned out to be more complicated than expected. We are taking our commitment to reduce regulatory burden on companies very seriously and are grateful for Parliament's continued encouragement in this regard.
However, it is difficult not to be disappointed with some of the proposed amendments to the First Company Law Directive. Let me recall that the European Parliament, in its resolution of 12 December 2007 on the Commission Work Programme 2008, welcomed the Commission's determination to reach the goal of a 25% reduction in administrative burdens on undertakings at EU and national levels by 2012. Parliament stated that it would regard this as a key priority for the coming months, in particular as regards SMEs, and as an essential contribution to reaching the Lisbon targets. Parliament therefore underlined that it would examine legislative proposals in this light.
Furthermore, in its resolution of 21 May 2008 on a simplified business environment, Parliament supported this specific proposal for modifications to the First Company Law Directive, agreeing that it should be easier for companies to publish statutory information. In particular, Parliament strongly supported the use of new technology.
However, the Legal Affairs Committee's report that is now on the table completely undermines the objective of the Commission's proposal. The Commission's impact assessment estimated the reduction potential at about EUR 600 million per year. Under the draft report, Member States could not only continue to impose all current administrative burdens on companies, but add new ones. So, whereas the Commission proposal is based on the idea that the new publication tool of an electronic platform should replace the current cumbersome publication methods, the draft report would, instead of reducing administrative burdens, add new ones.
The objective of the Commission's proposal has been supported by an overwhelming majority of stakeholders. It was also supported by a very large majority of Member States in the discussions in the Council that have taken place so far. But adopting the directive in the form currently proposed by the Committee on Legal Affairs would risk jeopardising the credibility of the entire administrative burden reduction exercise.
To the extent that the objective of the Committee on Legal Affairs amendment is to secure the financing of newspapers that currently depend on the fees for company publications, this objective can in principle be shared by the Commission. However, other ways for this financing have to be found. It cannot be imposed on the companies by obliging them to comply with publication obligations that do not provide any significant added value in today's technological environment.
Margaritis Schinas
draftsman of the opinion of the Committee on Economic and Monetary Affairs. - (EL) Mr President, on behalf of the Committee on Economic and Monetary Affairs, I should like to convey our opinion to you. We endorse to a large extent the root cause of this Commission proposal, which is well structured and, of course, is designed to minimise administrative burdens.
We think that, alongside translation, the simplification of procedures and the recognition of translations by other certified translators from another Member State is absolutely justified and fully endorse this approach.
Now I come to the question of publication. Our committee believes - as the Committee on Legal Affairs, in my opinion quite rightly, believes - that, in addition to companies, there are also citizens who also have the right to know. Unfortunately, Commissioner, citizens do not have the same access to electronic media to which your initial proposal directed them.
We live in a pluralistic Europe, with different models and different values. You, as a Commissioner from Ireland, know that the outcome of the referendum in your country, the perception of many of your fellow countryman about one model for all of Europe, cost us dearly. We do not therefore want to introduce this model in Europe, knowing full well that in my country, in my region, access to the Internet is restricted. Why should we therefore deprive these people, these European citizens, of the right to learn about things which concern them via other traditional channels?
I therefore consider, Commissioner, as do the Committee on Economic Affairs and the Committee on Legal Affairs, that the electronic platform must be compulsory and quite rightly so. However, it must not be the only platform. We must allow all European citizens to access information. We do not want a situation in which someone in a region of Europe has to find out what is going to happen in his region on a BlackBerry, because where I live many people do not have a BlackBerry.
I therefore consider that, as the representative of the Commission, and I believe that we should send the Council the same message, you must take serious account of the position which we expressed unanimously in the Committee on Legal Affairs and by a large majority in the Committee on Economic Affairs. May I say that, if you are thinking about ignoring it, I would advise you to think again, because it is only through productive democratic dialogue that we can find mutually acceptable solutions for the benefit of the many, not just the few.
Georgios Papastamkos
on behalf of the PPE-DE Group. - (EL) Mr President, the European Council in March 2008 ordered new, fast-track legislative initiatives to be taken in order to improve the business environment for companies in the Union by reducing administrative obligations and costs. In my opinion, the Commission's proposal for a directive which we are debating contributes little to the objective set.
The core problem for companies, especially small and medium-sized enterprises, is that objective conditions are needed for improving the bureaucratic, legislative and fiscal environment in general and we expect an even more substantial contribution on the part of the Commission in this direction.
In this particular instance, the main purpose of publishing companies' annual accounts and other financial statements is to apply the principle of transparency and publicity in commercial activities. However, the low level of penetration of the Internet in a significant number of Member States of the Union does not constitute an adequate guarantee.
Apart from that, having compulsory records in purely electronic format would also mean the loss of thousands of specialist jobs in traditional printed media. Furthermore, the press is an essential component of the principle of the transparency and democratic life of the Union, the contribution of which to the multilingualism and diversity of the European Union is beyond question.
I consider that the safety valve of adopting a single fee and of maintaining the parallel facility to publish in the printed media, in conjunction with the introduction of an electronic register, as formulated in the consensus reached and voted by all - I repeat all - wings of the Committee on Legal Affairs, is the balanced and rational solution needed.
In closing, allow me to emphasise that what is required of the European Parliament and what it has a duty to provide is productive consent to Community lawmaking whilst retaining the full independence of its legislative will. It is the will of the Committee on Legal Affairs, as already formulated, that plenary adopt the report by Mrs Kauppi, whom I congratulate on her work.
In post scriptum to you, Commissioner, I do not know if the consensus proposal by the Committee on Legal Affairs comes as a disappointment to you, but I should like to say to you and I honestly hope that, as soon as the Lisbon Treaty enters into force, the culture of cooperation between the Commission and the European Parliament will - and must - change. That is what we are waiting for now; that is what the democratically elected European Parliament is waiting for.
Ieke van den Burg
on behalf of the PSE Group. - Mr President, firstly I shall say something about the procedure. It is a pity that we did not discuss it this morning, Commissioner, when we were sitting together, because I was a bit surprised that you are so harsh now in your speech to Parliament. On the procedure, I am particularly harsh on the way that the French presidency has dealt with our proposals, in not meeting any requirements to negotiate or try to have a dialogue on a possible compromise.
It is the same for the Commission. With these types of issues it is normal to try to get together and find a solution that meets the concerns of the different parties. I regret that this has happened, and I hope that in the time between the plenary and the vote in committee there will be an opportunity to do that.
On the content, I think we do not differ so much. I am also very much committed to relief of administrative burdens. I am always pushing for the XBRL system in accounting and this type of electronic platform. I think we all agree that it is necessary, precisely because in some Member States the electronic society is not yet completely in place. It is necessary to have this temporary transitional solution so Member States still have the option of using this type of paper registration.
This is really a temporary problem and there could be a pragmatic solution. I heard this week that it is only 20 years since e-mail was first used and since the first internet connection, so in 10 to 20 years' time it will be completely normal for everything to be processed electronically. It is only a very temporary problem that we are facing and we should not make a big issue of it. We should try to find a reasonable, pragmatic solution in the spirit of what you are always telling us you want also.
Jean-Paul Gauzès
(FR) Mr President, Commissioner, ladies and gentlemen, I first want to thank our colleague, Piia-Noora Kauppi, for her excellent report and for her efforts to allow a reasonable solution to be found to the various issues, especially that of the platform.
The proposed directive is part of the wider action undertaken to reduce the administrative burden on companies, to reduce the restrictions upon them and increase their competitiveness. We, of course, actively support this objective which will benefit SMEs. We approve the creation of an electronic platform containing all information and the principle of a single fee to cover all of the costs related to the necessary publications.
It is appropriate, however, to provide the best possible information and to allow continuation of the usual publication methods, which are still needed, especially in the printed press. The text proposed by the rapporteur after negotiations, and unanimously adopted by the Committee on Legal Affairs, will allow the Member States to provide for the retention of the usual publication methods, as their cost is included in the single publication fee.
We have therefore, Commissioner, complied with the spirit of the proposal by making the platform a requirement and by maintaining the principle of a single fee. We have, however, taken account of the reality in various countries without the IT infrastructure that some other countries have, and which have information habits that should not be ignored.
Commissioner, you know that the citizens' views have to be taken into account and that Europe must not appear to be a source of new restrictions or difficulties. This is why we are looking for the flexibility to take into account the realities of the different Member States, whilst retaining an economical system.
You harshly said, Commissioner, that the Committee on Legal Affairs' proposal undermines the Commission's position. I do not think this is accurate, nor is it accurate to say that the Committee on Legal Affairs' proposal introduces new formalities. On the contrary, it is agreed that these are existing formalities which will be retained and we obviously reject the introduction of new formalities.
What is needed, Commissioner, I believe, is for Europe to show it is capable of reducing bureaucracy and administrative burdens, whilst respecting national identities.
Manuel Medina Ortega
(ES) Mr President, I want to thank the Commission for having presented this proposal. I believe it is positive and will help us to reduce unnecessary administrative burdens.
As previous speakers have said, this Parliament has a duty to bring down to earth the Commission's very generous and very altruistic proposals. The reality is that we have 27 countries with different legal systems and very different languages which means that, in each country, we must adapt to the realities of that country, including on the issue of languages.
However, as mentioned just now by Mr Gauzès and also by previous speakers, it is vital that the recognition of these national specificities does not lead to increased costs, that fees are uniform and that governments, if necessary, shoulder this additional cost.
However, there is also another issue: the issue of translations. In the European Union we do not have a common language. Different languages are spoken in all the 27 countries, and even within some of these countries, such as the Commissioner's. We have to live with this.
Also, in legal terms, we are faced with a reality in which legal documents differ. The Committee on Legal Affairs has, for example, proposed amendments on the certification of documents, together with the certification of translations. At this moment in time, the Committee on Legal Affairs is preparing a report on the recognition of certified documents in various European Union countries, which should complement this report.
Finally, I believe that the Commission has done well in presenting this proposal. The rapporteur has done a magnificent job and we have all tried to develop a proposal for a legislative text that can be recognised throughout the Union, thus guaranteeing rights and which is based on the reality of a Union that is still being constructed, that has different national legal systems and that has different levels of access to electronic communications.
Françoise Grossetête
(FR) Mr President, firstly I wish to congratulate Mrs Kauppi, the rapporteur, on her excellent work as, thanks to her, the Committee on Legal Affairs has found a compromise which was, I recall, Commissioner, adopted unanimously. This is, then, a clear signal. It will reconcile the need of companies, especially SMEs, for administrative simplicity and the citizen's right to information, whilst leaving Member States the option of retaining publication requirements, if they so wish.
I am convinced that the European Parliament will follow the lead from the Committee on Legal Affairs. The 27 Member States have their traditions. Some advocate the Internet exclusively. Others still use more traditional paper methods of communication. These traditions have to be respected. Let us not forget that 50% of Europe's citizens have no Internet access. If the information were only available on a single electronic platform, those unable to access the Internet, or who prefer to use paper, would be unable to receive information about companies in their region.
I believe that the European Parliament well understands that simply abolishing the publication of judicial and legal announcements in regional newspapers, for example, would have disastrous consequences. As a result, the Member States must be able to organise the distribution of information via complementary channels, under specific conditions.
Commissioner, this is not an ideological debate. Do you not think, in the current circumstances, that you have other things to do instead of hindering something which is working well in the Member States?
In seeking always to simplify, there is sometimes the risk of making things more complicated. Reducing costs? Yes, but at what price? Easing the restrictions to increase competitiveness? Yes, but what happens to competitiveness when the simplification risks severely damaging the economy of an entire sector? There is a strong desire for the Commission to take notice of the fact that we support solutions which will allow the printed press to overcome the difficulties it currently faces.
Commissioner, you should not be impervious to the traditions of the Member States. By acting in this way, you are responsible for risking redundancies for a certain number of journalists and a lack of information for a large part of the population.
We are looking for a balanced directive incorporating the electronic platform and the single fee. We are convinced that we have achieved this solution, and you must respect the European Parliament's vote.
Lidia Joanna Geringer de Oedenberg
(PL) Mr President, the European Parliament has long been raising the issue of unnecessary and disproportionately high administration costs imposed on European enterprises. These costs not only make doing business more difficult, but represent a barrier to meeting the challenges of today's highly competitive world economy.
It is therefore pleasing that the Commission has finally turned its attention to this issue, proposing to apply the fast-track procedure to the amendment of the 1st and 11th Company Law Directives, which will contribute to a faster improvement of European enterprises' business environment. In the case of the 1st Directive, the elimination from national law of all additional disclosure requirements which increase enterprise costs seems very appropriate indeed. The proposed electronic platform with full information about companies will provide an economical and easily accessible solution, as will the single payment covering all costs, whether administrative or associated with disclosure requirements.
The proposal relating to the 11th Company Law Directive concerns the translation and certification of documents to be entered into the commercial register of a branch of a company established in a different Member State. The mutual recognition of translations proposed by the Commission as a way of reducing the administrative burden will undoubtedly contribute to reducing the costs borne by companies, while ensuring the reliability of the translations. Finally, may I congratulate the rapporteur, Mrs Kauppi, on the excellent report.
Costas Botopoulos
(EL) Mr President, Commissioner, I should like to use the privilege of being the last speaker to make a political comment and two technical comments on the directive which we are debating.
My political comment is that today we are witnessing a rare moment in the European Parliament: complete unanimity in all wings of the House, from the right wing to the left wing, on the direction in which Parliament wishes to take a specific legislative initiative. Numerous members have said and I too wish to emphasise the fact that this is a rare occurrence and must of necessity be taken into account in the Commission's final decision.
We are not undermining the Commission's proposal. We are trying to modernise it and make it more human, more logical and more practical. That is my political comment.
I have two brief technical comments: on the question of publication, Members have said and I too shall add that it is absolutely fair and absolutely right for the Member States in which access to the Internet is severely limited to be given the facility, alongside the general rule of electronic publication, of publication in the press for obvious social and financial reasons.
I should like to comment briefly on the question of translation, with which there is no problem whatsoever. The facility for there to be just one recognised translation gives us a practical solution. The question of translation raised here is not a question of language, it is not a question of transparency, it is not a question of style. It is a practical question which can be very simply resolved by recognising the translation.
There is a distinction, therefore, between the political issues and the technical issues. We are not undermining the proposal, we are improving it.
Charlie McCreevy
Member of the Commission. - Mr President, let me begin by saying that if Ieke van den Burg had raised this issue this morning, I gladly would have dealt with it. I had asked you whether there were any other issues you would like to raise and, if you had, I would have spoken to you about it. If you had raised any issue at all - including the weather in Ireland - I would have discussed that with you as well. I have no problem doing that.
I do not have any problem at all as to what the European Parliament decides, because that is your job and that is what you must do. But the background to this particular proposal has to be kept in mind and, since I appreciate your position, I would ask you to appreciate mine.
This particular proposal was put forward in the context of reducing the administrative burden on small companies. It was part of the simplification of the business environment. There are estimates of what this proposal would achieve: reducing the cost annually by EUR 600 million. So the reason for putting forward this proposal was to reduce administrative costs for small business. As I pointed out in my earlier remarks, the whole project of reducing costs has been welcomed by the European Parliament in various resolutions.
So this is the context in which this was put forward. With the idea of bringing down administrative costs and simplification for smaller business we came up with this particular proposal.
You can hardly expect me then to accept amendments by the European Parliament that go in totally the opposite direction by not reducing administrative costs but increasing them. If the European Parliament feels that, in this particular instance, the balance of advantages weighs further in keeping this the way they want, so be it. That is a perfectly legitimate viewpoint. But this cannot be reconciled with the original objective which you brought forward, which was to reduce costs. If Parliament and others feel that for all the reasons you have outlined it should be kept like this, you can hardly expect me to stand up and agree with you that this is going to reduce administrative costs when it is going to do the opposite - in fact it is going to add to costs rather than reduce them.
The amendments tabled by the two European Parliament committees mean that the only change that Member States would have to implement following the adoption of this directive would make the use of an electronic platform mandatory. No reduction in the current administrative burden would be achieved by the savings which we expected from our original proposal, which have been assessed, as I said, in the impact statement, at around EUR 600 million per annum. So adopting a directive that leads to no reduction but only to cosmetic changes would definitely give a bad signal concerning the overall reduction of the administrative burden that we have been talking about.
So I would ask Members of the European Parliament to respect my position also. If the view of Parliament seems to follow that particular line - and there will be a vote on it tomorrow - that is your view and you are fully entitled to that position. I have no difficulty with it. But you have to respect my position in that I can hardly accept amendments that go in the opposite direction to the original purpose of bringing this forward in the first instance. We should not fall out about it, but I will not be in a position to turn logic on its head and say that what the European Parliament is doing is all right, because it is increasing administrative costs rather than reducing them.
I can listen to the reasons you put forward for keeping it as it is - and perhaps there is some validity in them - but that is not what we started off doing; that is not the reason why we brought forward this particular proposal. So, c'est la vie!
Piia-Noora Kauppi
rapporteur. - Mr President, I would like to make a comment about the procedure. Mrs van den Burg already said that the French presidency has not behaved very well with this dossier. We have tried to propose several possibilities for trialogue meetings to discuss possible compromises. Unfortunately the French presidency is unwilling to come to these meetings. They are unwilling to organise meetings in the Council working group in order to discuss the way forward. Also they are not present here today to discuss this very important matter.
The view of the Committee on Legal Affairs gives a lot of flexibility for the Member States. It gives much more flexibility than my personal view. However, the view of the Committee on Legal Affairs is going as far as we can possibly go. This is the only proposal on the table in Parliament at the moment. My opinion is that if the Council is not able to accept Parliament's view, i.e. the view of the Committee on Legal Affairs - which is to be voted on tomorrow - as we have requested them to do, then we have to go to second reading.
We cannot allow Council to play us. If this is not accepted in the form voted on tomorrow by Parliament, we will certainly have a delay in the process. Perhaps we will not have this project ready before the elections and there is a risk perhaps that the Commission will withdraw the proposal. I think that it would be very disappointing if Council does not have a qualified majority behind it and does not come up with proposals on how to reach a compromise.
We would be willing to discuss compromises. I would personally be very happy if the Council would propose something in the trialogue meeting on which we could then base the compromise, but it is hiding and not coming to meetings and it is not organising trialogues. It leaves us in a very difficult situation.
That is why I am upset about the discussions about the procedure. I hope that the Commission does not withdraw the proposal. I hope there will still be an opportunity to have a compromise that would suit all the Member States and also the European Parliament.
President
The debate is closed.
The vote will take place tomorrow.
