
President.
   I declare resumed the session of the European Parliament adjourned on Thursday, 1 April 2004. 
President.
   It is my sad duty today to mark the cowardly murder at the hands of terrorists in Iraq of the Italian citizen, Mr Fabrizio Quattrocchi.
I want to say, on behalf of the European Parliament, that we unreservedly condemn this despicable crime and we express our feelings of deepest sympathy and condolence to the family of the victim and to the Italian people and government.
We appeal from this House to the kidnappers – in so many places now in Iraq – immediately to free all hostages still in captivity. This is not serving the ends of handing Iraq back to the Iraqi people in terms sustainable for any of the parties involved. I ask you please to observe a minute's silence.
Roth-Behrendt (PSE ).
   – Mr President unspecified allegations of misconduct made about me and about some of my colleagues are appearing in the German press. This is something we have already discussed in this House. Unfortunately, it is not my work to which these reports refer; instead, there are only allegations to the effect that there is something objectionable about my behaviour, but as I am unable to ascertain what I am being accused of, I ask you, Mr President, to investigate further.
It is also stated in the German media that you are to meet a certain Member this week and that the Member in question will then hand over certain lists to you. If this is the case, Mr President, I ask you to find out at once whether there is anything of which my colleagues or I might be accused. If there is, then I ask that you forward all the documents, at once, to the European Court of Justice or to the Court of Auditors and to OLAF. It would of course be good of you to inform those against whom the media are making what are really very nasty, dirty and unpleasant accusations, of what precisely they are being accused – that is, of whether they have been bad at their jobs or have broken the law.
President.
   Mrs Roth-Behrendt, I find it extremely unfortunate that you should have to defend yourself, as someone with very good standing in this House, precisely with regard to what you are elected to do and the leadership you give in your committee and in so many different aspects of the work of this House.
As you will know from my statement at the last part-session, I have invited a Member of this House, who has been prominent in the German-speaking print and broadcast media, to forward to me whatever specific allegations there are so that I can fulfil my duty of care to this institution and to its Members and their reputation. I have as yet received nothing in writing. I have had no telephone call, no e-mail, and although I too am informed via the press of various intentions, no one has had the courtesy to inform me personally of what those are. You speak of meetings that are not in fact on my work schedule because no one has requested such meetings. I regret to say that, in these circumstances, it becomes impossible for the House, and for me in respect of my duty of care both to the House and to its Members, to act in any reasonable or fair way when, as far as I can understand, all we have are significant yet unsubstantiated general allegations concerning the Rules of Procedure, as distinct from allegations concerning persons whose responsibility it is to follow those Rules.
I would appeal, as I did last month, to those who have evidence of any wrongdoings to provide me with evidence, to release me to do my duty before this House, its Members and the European public. Please stop boxing in the shadows: come out into the open and let me deal transparently with substantive and transparent allegations.
Leinen (PSE ).
   – Mr President, I am very grateful to you for what you have just said. Mrs Roth-Behrendt spoke on the substance of the allegations of misuse of funds by Members of this House, and then you made your own contribution. I just want to remind the House of how these accusations came to be made over the past three years; the Member to whom reference has been made used a concealed camera to spy on Members as they went about their work. In so doing, he violated all the rules of honesty, trust and collegiality.
I cannot see the European Parliament meekly accepting this sort of thing without a word of criticism. It is not individuals who suffer, but the House as a whole, when this sort of espionage is used to investigate the work we do. I would ask you to condemn this unequivocally in the interests of all Members of this House.
President.
   The final draft agenda as drawn up pursuant to Rules 110 and 110a of the Rules of Procedure by the Conference of Presidents at its meeting of Thursday, 15 April 2004 has been distributed. Are there any comments?(1) 
Podestà (PPE-DE ).
    Mr President, I refer to the Boogerd-Quaak report for which, moreover, the Committee on Citizens’ Freedoms and Rights, Justice and Home Affairs has been convened today for 7 p.m.
Before Easter, Mr President, I wrote to you to submit a series of points that, from a procedural and regulatory point of view, do not seem to me to be in line with our Rules of Procedure. I cited your responsibility as President, pursuant to Rule 19(2) on checking the conformity of reports with our Rules of Procedure. Specifically – and here I am also speaking on behalf of Mr Gemelli, who could not be here today but who I know wrote to you last week – the Committee on Petitions was not even consulted, that is to say it was not asked for an opinion on the report. We are clear about the lack of a legal basis and yet we have a genuinely unique situation whereby significant reference is being made, in this report, to a study document drawn up by a third party not authorised according to the standard procedures for our Parliament. It is a document which, moreover, claims to be entirely provisional since the situation has only been examined in eight out of 25 countries and since the comparisons that are due to be carried out at the end of June have not been completed.
This is why, Mr President, I wonder how this report can be debated in this sitting and I ask you, therefore, to refer it back to the competent committee in order that the Committee on Petitions can make its substantial contribution.
I would like to mention that this is not a responsibility of the House. Checking the appropriateness according to the Rules of Procedure is the responsibility of the person presiding over the institution, and is not in any way subject to a majority vote. You understand that at the basis of democracy, and even more so for a Parliament that is the ultimate embodiment of democracy, it is inconceivable that obligations provided for by the Rules of Procedure should be avoided by using majority voting.
President.
   Thank you for your comments, Mr Podestà. You will be aware from our meeting of the Conference of Presidents last week – which you attended – that I have asked the services to undertake to review your very detailed correspondence with me regarding the Rules of Procedure and their application. Since my arrival here today – a journey which always takes some time, in spite of early departure – I have not had the opportunity to see a note on this matter that has been prepared for the meeting of the relevant committee this evening. I am not in a position at this moment to give a ruling on admissibility. However, the initial advice I have received – before the services have had an opportunity to study your lengthy letter to me in depth – seems to suggest that the report may be admissible, although there are elements that need to be looked at carefully.
We have asked the Committee on Citizens' Freedoms and Rights, Justice and Home Affairs to meet this evening to consider the issues raised by the Rules-related observations you have made, and to consider around 350 amendments. I want to make it perfectly clear that under the Rules we do not have time this week to take a report with that number of amendments. That is why I for one want the committee to meet and consider the issue.
If I have understood correctly, you have asked for a referral back to committee and therefore a removal of this item from the agenda. If that is indeed your request then I will take one speaker for and one against and we would then have a vote. However, Mr Podestà, if you are prepared to wait for the committee to meet this evening to consider the question as it relates to the Rules and admissibility, and to consider the question of the number of amendments, then we could proceed to invite our colleagues on the committee to discuss those issues later today.
Mr Podestà, do you now wish to make a request to refer back, or are you satisfied that this should be dealt with today in committee? 
Podestà (PPE-DE ).
    I agree with you, Mr President. I believe that it is appropriate for the committee to consider the issue, but above all – and I am also saying this on behalf of my colleague Mr Gemelli – for replies to be given based on your assessment, Mr President, on the strength of the details that the services will provide you with. 
President.
   I shall do that in writing once I have received definitive advice. I must compliment you on your thorough understanding of our Rules of Procedure: it is so much more thorough than my own knowledge and thus I am badly in need of advice on this matter! 
Frassoni (Verts/ALE ).
    Mr President, given that you will have to carry out this important check, my request is that this is done with the utmost respect for the wishes of the competent committee; indeed we have already had huge problems concerning the tabling office, not least over a report – by my colleague Mr Voggenhuber – which is to be debated soon. On the issue of discretion and of the admissibility of subjects, I therefore genuinely appeal to you to carefully consider the political will expressed by the committee responsible, after a complicated debate.
I would also like to say that, as far as the number of amendments is concerned, the great majority of these come from one political group: I therefore wonder whether this political group is resorting to stonewalling, something that we will deal with today.
Boogerd-Quaak (ELDR ),
   .  Mr President, I have to say that I was, as rapporteur, extremely surprised at the 350 amendments in the plenary meeting, whereas we in the committee had an excellent discussion with far fewer amendments than there are now. Nevertheless, I have read the amendments and this evening, we in the relevant committee will see what we can do with them all and make sure that an opinion is brought before Parliament.
I am, however, extremely taken aback by the fact that we in the plenary meeting appear to be doing the work now that has not been done in the relevant committee. I should also like to note that there is Europe-wide support for the content of this report. If you feel that there are sections that do not comply with the Rules of Procedure, then I should like to hear from you, in which case we can still, if necessary, withdraw the sections concerned.
This is, in principle, an excellent report, at least according to its supporters and detractors in the media world. I therefore fail to understand why we should withdraw it now for reasons of this kind. I should like to have this issue resolved and heard beforehand. 
President.
   Several other colleagues have asked to speak but I do not want to replace the work the committee will do on our behalf this evening. If any additional points of procedure arise from the committee's work this evening, we will have to deal with them later.
I would now like to close on this issue and assure the rapporteur and the committee that they will be the first in this House to receive whatever advice is available to me regarding the Rules of Procedure in respect of this matter. We will evaluate the advice of the committee as to how we should proceed.
For now, then, let us refer the work to the committee for its meeting tonight and see what emerges from that. 
Fiori (PPE-DE ).
    Mr President, I would like to wind up the discussion on the Boogerd-Quaak report.
This is not about the committee’s political assessment or otherwise; the question is whether or not the Rules of Procedure have been breached. Since freedom of expression is a significant matter, which is very important to us, we would like this matter to be dealt with seriously and for it to continue to be debated. I therefore believe – and I am, of course, speaking on behalf of my group – that the report should be referred back to committee. 
President.
   Mr Fiori, I thought that we were simply inviting the committee to look again at the Boogerd-Quaak report. If, on behalf of the PPE-DE Group, you insist formally to refer the report back to committee, I can take one speaker for and one against and we could have a vote. 
Paciotti (PSE ).
    Mr President, the claims made by Mr Podestà and Mr Fiori seem to me to be totally unfounded. They claim that the Rules of Procedure have been breached because the Committee on Petitions did not give its opinion. This is a completely unfounded allegation. The same Committee on Petitions sent us the first petition pursuant to Article 7 of the Treaty so that we could look into it.
The Conference of Presidents authorised the Committee on Citizens’ Freedoms and Rights, Justice and Home Affairs to draw up this initiative report: it is a political report and not a legislative one. We were sent two further petitions for information, but we are not deciding on these. We decide independently and the committees to be consulted were determined by the Conference of Presidents, which called on the Committee on Citizens’ Freedoms and Rights, Justice and Home Affairs to carry out this report. It said, ‘Draw up this report and listen to committees x, y and z,’ not the Committee on Petitions. At most this will be about withdrawing approval of these petitions that were sent inappropriately but no mistake has been made in terms of the Rules of Procedure; and I believe that the Presidency could assess this without needing to refer anything back to committee.
The Committee on Citizens’ Freedoms and Rights, Justice and Home Affairs was simply appointed, pursuant to Rule 130a of the Rules of Procedure, to check something that is obvious: to see if a tenth of committee Members support each of the 330 amendments tabled with the intention of stonewalling. Clearly, since they were tabled by the Group of the European People’s Party (Christian Democrats) and European Democrats, the amendments will have the support of a tenth of the Members and, therefore, having carried out this check, we will have fulfilled the task given to us by the President.
President.
   Mr Fiori, I have been looking at Rule 144 on referral back to committee. Let me explain that you are within your rights to move a referral back to committee, but I should have been notified 24 hours in advance. That was not the case, so you have forfeited that right today. If you wish, you have the right to move referral back when we come to vote on the report, if indeed we get there this week, and if the committee prepares the way tonight. So you do not lose the opportunity to refer the report back, but you have forfeited it at this particular time.
The committee will meet at 7 p.m. this evening and will hopefully bring some light, as well as some heat, to the matter when we return to it.
I have received a request from the GUE/NGL Group to include on Tuesday's agenda the report (A5-0274/2004) by Mrs Eriksson, on behalf of the Committee on Women's Rights, on the consequences of the sex industry in the European Union. 
Eriksson (GUE/NGL ),
    Thank you, Mr President. I understand that the Conference of Presidents has decided to remove this report, previously considered by the Committee on Women’s Rights and Equal Opportunities. This was at the request of the Group of the Party of European Socialists and the Group of the European People’s Party (Christian Democrats) and European Democrats, who argued dishonestly that the report should be referred back to committee.
The committee has had its last meeting and, since I am not standing again, a referral would sound the death knell for this own-initiative report. The report deals with the demand side of such issues as trafficking in human beings and sexual exploitation. If Parliament does not discuss the report and place that aspect in context, I do not see the reason for discussing sexual exploitation at all.
I therefore call for the report to be returned to the agenda as previously planned pursuant to Rule 111 of the Rules of Procedure. 
Wurtz (GUE/NGL ).
    Mr President, I should like to support Mrs Eriksson’s request for three reasons. Firstly, as she has said, this is our last chance to examine this report. If it does not appear on this session’s agenda, it will lapse.
The second reason is that it has given rise to a considerable amount of work in committee. We are all aware that it has been the subject of many disagreements, but the committee has succeeded in finding a compromise. Everything is therefore ready and I think that it is only fair to ensure that all the work which has been done receives a favourable outcome.
Finally, this is a social issue which is very sensitive in many countries. We may be in favour of this report, we may be against it, or we may want to amend it, but I believe that the worst thing we could do would be to give the impression that we are unwilling to deal with this subject.
That is why, Mr President, I should like to insist, on behalf of our group, even though I am aware that the agenda is relatively crowded, that this question should be included in the agenda for this part-session. 
Pack (PPE-DE ).
   – Mr President, on behalf of my group, I would like to say that, much as we could endorse a lot of what is in it, this report is, as a whole, unbalanced; parts of it make no sense and contradict each other, and everything is repeated time and time again. I do ask most earnestly that we should distance ourselves from this report and, in the autumn, get back to the important things it contains, which, I believe, merit really in-depth, serious and proper consideration. 

 – I have received a request from the PPE-DE Group for a Commission statement on Eurostat, with motions for resolution, to be included in the joint debate on the 2002 discharges. 
Poettering (PPE-DE ).
   – Mr President, we have, over many weeks and months, been devoting our attention to Eurostat, and you will be well aware that a substantial number of us here in this House even wanted to go as far as to state that it had no confidence in the Commission. Although I have always been opposed to a vote of no confidence in the Commission, this House does have a legitimate interest in hearing what the Commission has to say on the subject and how it assesses what went on at Eurostat. Our listening to the Commission’s statement, and our discussion of it, is a sign of fairness, openness and transparency. 
Kuhne (PSE ).
   – Mr President, politicians are always extremely adept, when elections are in the offing, at finding ways of putting Parliament’s procedures to work in the service of their own election campaigns. Let me remind Mr Poettering that we will, as part of tomorrow’s discharge debate, be discussing a report by a member of his group, Mr Bayona de Perogordo, which contains a whole passage on Eurostat. I would also like to remind him that all of us in this House do of course expect the Commission to comment on it tomorrow. I do not think it makes any sense to impose on Parliament a procedure that is intended solely to promote harmony within the Group of the European People’s Party (Christian Democrats) and European Democrats after the British Tories failed to get enough signatures for a motion of no confidence in the Commission.
Many of the tricks that are used to provide grist to the mills of the election campaigns are too obvious not to be noticed, and, having noticed them, we have to vote against them.

(2)
I have received a request from the Verts/ALE Group for Council and Commission statements on the situation in the Middle East. 
Frassoni (Verts/ALE ).
    Mr President, this session is particularly complicated but unfortunately the world is also complicated. Our role as the ‘eye of the international community’ means that we must be thereand opine on the bloody events that are taking place in the Middle East, because the European Union, represented by its Member States, is not capable of doing so incisively and forcefully enough.
We are calling for this statement on the Middle East to be put on the agenda, because we want to know how the Council and the Commission will act in a situation in which – and there is no doubt about this – there are governments that continue to pour oil on the fire in order to influence this conflict.
I would also like to draw your attention, Mr President, to the fact that we recently adopted a resolution on this matter, and one paragraph in particular in which we call on the Council and the Commission to take into consideration the possibility of acting to enforce Article 2 of the Association Agreement with Israel, if the latter continues to carry out the policy of extrajudicial killings. We believe that, at this point in time, it is worth opening a debate in Parliament and making a decision, but above all it is worth hearing what the Commission and Council have to say to us. 
Swoboda (PSE ).
   – Mr President, I think this does indeed represent a very significant change in, or clarification of, the American position, and a position of this sort can indeed drive a new wedge between the United States and Europe. That is why it is important that the issue should be discussed. If it is argued that there is too little time available, then it could, of course, be combined with discussion of trans-Atlantic relations, in which the Middle East presents a major political problem. The fact that there are, of course, others is no excuse; if it really comes to it, it could be discussed along with trans-Atlantic relations, although this is an important issue and any statement would have to address it separately. 

 As you know, we will have debates on Cyprus and transatlantic relations that day. Those debates may run over into Question Time. I should like to signal that, because Cyprus needs a space on our agenda. Indeed, apart from the Middle East there are many transatlantic issues that also need their space. So I point out to you that exceptionally, on this occasion – and I extend my apologies to Mr Posselt in advance, as well as to Mr Puerta, our Vice-President who keeps telling us not to do these things – we may run over into Question Time.(3) 

President.
   On April 14 2004 I received a letter from Mr Gargani, in his role as chairman of the Committee on Legal Affairs and the Internal Market in which, at the request of the Committee on Citizens' Freedoms and Rights, Justice and Home Affairs, he informed me that the Legal Affairs Committee recommends the introduction before the European Court of Justice of a request for an opinion in order for the Court to examine whether the object of an agreement between the European Union and the United States for the treatment and transfer of data – PNR – is compatible with the Treaty, and to establish whether the content of the agreement could put at risk the fundamental right to data protection accorded by the Treaty and by various European directives.
As you know, the House will discuss the Boogerd-Quaak report on the EC-USA agreement on PNR issues tomorrow evening. I do not wish to have that debate now. The reason I wish to consult the House at this moment is that our Rules of Procedure are clear: if I follow the advice of the Legal Affairs Committee, I act as a kind of postman through whom the request passes to the Court of Justice. It seems to me, given the issues involved, that it would be useful for me to benefit from the advice and guidance of the House. Therefore, under the Rules of Procedure, I had thought it better to pause for thought and to raise the matter at the opening of business today to hear a brief statement from the Commission and from the Groups, and then to ask the Groups tomorrow at midday to advise me as to whether to proceed in bringing the matter before the Court.
I ask Commissioner Bolkestein, who has been waiting here patiently as we arranged our business, to give a brief announcement concerning this aspect of the matter. 
Bolkestein,
   . Mr President, thank you for giving me the floor on this much-debated subject. The question that has been put to the Commission is a precise one: is the Commission prepared to withdraw its proposal to the Council to conclude an international agreement with the United States of America on the processing and transfer of passenger name record data by air carriers to the US?
The context in which this question is asked is also clear. If the Commission does not indicate its willingness to follow Parliament's wish expressed in its Resolution of 31 March – namely to replace the present 'light' agreement and adequacy finding with a more substantive international agreement – Parliament will vote to seek an opinion from the European Court of Justice on the legality of the agreement currently before the House.
The Commission is grateful for this opportunity to state its position in advance of the vote. In this context, I understand that Parliament seeks answers from the Commission on two issues. Firstly, Parliament wishes to know whether or not the proposed international agreement modifies the Data Protection Directive as far as data exchange with the United States is concerned, and, therefore, whether or not the agreement is well founded as far as both the protection of fundamental rights and the European Parliament's prerogatives are concerned. Secondly, Parliament wants the Commission to clarify the situation regarding data transfers by the United States to third country governments.
On the first point, the Commission does not consider that the international agreement amends the Data Protection Directive and, therefore, there is no ground for basing it on the second subparagraph of Article 300(3) of the Treaty. If the agreement had amended the directive, the Commission would have proposed a different legal basis for the agreement and would have sought the assent of Parliament. But, I repeat, in our view, the agreement does not amend the directive.
The agreement leaves the protection afforded by the directive unchanged; in particular the proportionality requirement and the need for personal data to be processed fairly and lawfully. However, the international agreement is necessary to ensure a legitimate basis for air carriers and computer reservation systems to process the PNR data as asked for by the United States, insofar as they are covered by the adequacy finding.
Beyond that, the international agreement contains a number of important guarantees for the European Union; notably US commitments regarding non-discrimination and reciprocity and a joint EU-US review of the implementation of the agreement.
With regard to the second point concerning transfers to third countries, this is a new issue which came up in our talks with the United States only relatively recently. It concerns the safeguards that apply to the sharing by the United States of PNR data with law enforcement authorities in third countries.
As I drew to the attention of the House in my statement of 29 March, the Commission is still holding discussions with the United States on this point. In fact they have been continuing today and will continue further. I understand that the House would welcome further information on this point. In particular, the rapporteur raised the question of whether the Commission had come to a firm conclusion that there is adequate protection or whether these further talks meant that this question remained open.
Our discussions with the United States on third country transfers have not yet been concluded. As I said earlier, they have been going on today and may continue tomorrow morning. Therefore, I cannot inform Parliament at this moment of the outcome in the required detail. Currently, Director-General Alex Schaub of the Directorate General for the Internal Market is, with his staff, negotiating this issue with the American side.
These talks are not designed to bring about any changes in the documents you have seen, but rather to clarify how the undertakings will be applied in the case of the transfer of PNR data to other countries. They will seek to ensure, in particular, that the purpose limitation agreed in paragraph 3 of the undertakings is respected, even when data is passed on to third countries. Of course, the Commission is pushing the United States for guarantees that are as strong as possible. This issue will be discussed at the meeting of the College of Commissioners tomorrow afternoon.
My colleague Chris Patten will be addressing this House tomorrow evening on the international agreement. He will inform the House on the outcome of the discussions with the United States, and of any relevant developments.
It seems to me, therefore, that it would be best for Mr Patten to inform the House following the Commission meeting tomorrow afternoon and then for the House to decide as it thinks best. 
President.
   I would now like to hear the Groups' assessments on the matter of referral to the Court. This may well be informed by what the Commissioner has just said, but I should like to remind you that the full debate on PNR will take place tomorrow. 
Lehne (PPE-DE ).
   – Mr President, ladies and gentlemen, where this issue of an appeal to the European Court of Justice is concerned, the Group of the European People’s Party (Christian Democrats) and European Democrats is being entirely pragmatic in its approach.
What concerns us is that failure to come to the sort of agreement that the Commissioner has described will lead to a great deal of inconvenience for EU citizens travelling to the USA. If the Americans do not get by this route the information they require, they will obtain it by other means, whether this involves questioning at the border, mandatory visas or interviews in Consulates-General.
Secondly, if we do not get this agreement, our citizens will be in no better a legal position as regards data protection; indeed, they will be in a worse one, because we will have no influence whatever on what the Americans do with the data they obtain.
With this in mind, we are grateful to the Commission for its efforts, and have, as a group, expressed our opposition to an appeal to the Court of Justice not only in the course of the debate in the Committee on Citizens’ Freedoms and Rights, Justice and Home Affairs, but also in the resolution of the Committee on Legal Affairs and the Internal Market. 
Paciotti (PSE ).
    Mr President, for more than a year, a majority in this Parliament – although the Group of the European People’s Party (Christian Democrats) and European Democrats are of the opposite opinion – has claimed that it is a serious violation of the fundamental right of European citizens to data protection to demand that all European airlines are obliged to process European citizens’ data contained in their computerised reservation systems as requested by the United States Department of Homeland Security, Bureau of Customs and Border Protection and in line with US legislation. On top of that, there is not even any US legislation since no US law exists to protect private data.
We are therefore obliged to process our data, the data of our citizens, as requested by an administrative body of a third country. We therefore want an international agreement that grants rights. This controversy has been going on for a year and the Commission, even now, repeatedly says that the directive has not been amended, but on this basis it has been breached. This is the opinion of the majority of Parliament.
This is why we are calling for a preliminary decision by the Court of Justice. I do not even believe that we need wait for further news tomorrow because, I reiterate, we have carried on for a year or more. The only way to solve the matter – as to if it is true or if it is not true that a right in the Treaty has been breached – is to ask the Court of Justice for a ruling in advance, before signing the agreement, so that we do not end up nullifying an agreement that has already been drawn up, since this would damage relations.
Watson (ELDR ).
    Mr President, on behalf of the ELDR Group I would like to congratulate the Commission, and Commissioner Bolkestein in particular, on his efforts to try to reach agreement with the United States on such a difficult matter. My Group regrets that he has not been more successful in persuading the United States to respect our concerns about data privacy. My Group cannot agree on the choice of legal basis. While, as Mr Bolkestein says, the agreement does not formally amend our data protection directive, it clearly amends the law as it applies to European Community citizens by making us subject to US law in this area, and the absence of protection in US law is precisely our concern.
There is a huge democratic deficit when the Commission comes forward with a proposal like this and does not give either the European Parliament or national parliaments the chance to say yes or no. Now, as Mr Bolkestein informs us, that the information being passed to the United States' authorities may be passed on to third country authorities, we should be seriously concerned.
There have been three debates and votes in this House on the matter. Three committees have examined it and all recommended a referral to the Court of Justice. My Group does not seek a dispute with the Commission. We have asked the Commission to withdraw this proposal and to try to negotiate with the Americans and present to us and the US Congress a full-blown international agreement to cover these issues so that we can effectively fight terrorism together while respecting our commitments to data privacy. We would prefer the Commission to do that, but if the Commission cannot do it, perhaps at least at its meeting tomorrow the Commission could agree to take the initiative in referring the matter to the Court of Justice to decide whether there is adequacy. 
Di Lello Finuoli (GUE/NGL ).
    Mr President, I do not want to repeat all the things that my fellow Members who spoke before me have already expressed very well.
On many occasions, the Commission has said that this is the best agreement that it could extract from the United States Government, but it must be said that, the more debates we have, the worse the situation gets for European citizens. Indeed, today we know that this agreement not only implies a violation of the Treaties, but even the possibility that these data will be transferred to a third country and will be processed by them, which thus made it more difficult to get the debate on the first part of the agreement under way.
As has already been said, this Parliament has often said that it is against this agreement. Of course, it has not specifically voted on resorting to the Court of Justice but this, in my opinion, is a necessary consequence. We are therefore calling for Parliament to be able to take the opinion of a third, much respected and authoritative authority, such as the Court of Justice, and thus be able to freely decide whether to say yes or no to this agreement. 
Frassoni (Verts/ALE ).
    Mr President, I do not wish to repeat what has already been said either, since my group endorses what Mr Watson, Mrs Paciotti and Mr Di Lello Finuoli said. We agree that we should continue along our path, because I do not believe that Commissioner Bolkestein’s words are satisfactory and, indeed, I am also a little surprised by his lack of consideration for a vote, so unusual for Parliament, such as the one which took place at the last part-session.
It is indisputable, Commissioner Bolkestein, that by not entering into a real international agreement with the United States, the Commission has chosen to bypass Parliament’s opinion. The fact that you have opted for soft law instead of a real agreement already speaks volumes about the Commission’s intentions to exclude democratic control of this agreement, and I find this particularly worrying.
We do not seek a dispute with you – if, however, you are determined to force it on us then we will have no option but to fight it – but we believe that it is extremely important to seek the opinion of the Court of Justice. Your announcement, Commissioner, was not enough to prevent us doing so and we think that this stand will also be useful for the Commission so that, in the future, it will not commit these mistakes at the expense of the citizens. 
Boogerd-Quaak (ELDR ),
   .  Mr President, I have to say that I am not very happy about the Commissioner’s remark that there is no violation of Regulation 95/46. Paragraph 4 of the agreement itself states that all data of European passengers will be processed according to US constitutional requirements. One of the laws in the United States that should apply is the Privacy Act, but this Act does not apply to people from third countries, to name but one example. Article 6 of the agreement states that there will be reciprocity insofar as feasible and that it shall be strictly applied. I do not want to have the debate now, but I can easily give you another ten examples of things that are not right and are, in my view, a violation of our privacy legislation. For that reason alone, we should put this matter to the Court.
In the previous debate, the Commissioner said, with regard to the passing on of data to third parties, that ‘we are still in negotiation with the United States’. I heard this correctly last time and also this time round. It is surely too crazy for words that I as rapporteur have to submit to this House a report on adequacy finding,while the Commission itself still holds the view that the whole matter was inadequate. This is something I really do want to bring in to the debate.
I should like to thank all those Members who have spoken out in favour of recourse to the Court. I think that the question to the Court, as to whether we can conclude international agreements in which both Parliament and the American Congress are placed offside, is a very interesting one indeed. In consultations with members of the Congress, I have been given to understand that, should such an agreement be put to the American Congress, it would never agree to it.
We in this House should now also demonstrate that we know how to stand up for our citizens and not be put under pressure by anybody. We are alone in being able to do this. I am therefore hopeful that Parliament will follow the line taken by the Committee on Legal Affairs and the Internal Market. 
Hernández Mollar (PPE-DE ),
   .  Mr President, we have, of course, already debated in depth all aspects of the agreement with the United States on the treatment of the personal data of passengers travelling to that country from EU territory.
The request for the prior opinion of the Court of Justice, as Mr Lehne, from my own political group has quite rightly said, will only postpone the signing of the agreement and leave a legal vacuum in place in relation to the treatment of personal data by the US authorities, seriously prejudicing the European public and the air carriers themselves.
It is not, therefore, necessary to repeat our position, which is already well known. We also believe, naturally, that this agreement can be improved but also that the fight against terrorism and cooperation with third countries in the field, with the United States in this case, is a priority for the European Union. Furthermore, Mr President, we need the agreement now and, in any event, there will always be the possibility of referring the matter to the Court of Justice at a later date.
I would also like, Mr President, to take up Commissioner Bolkestein’s proposal that we listen to what Commissioner Patten says to us tomorrow afternoon with regard to the agreement and delay the vote scheduled for tomorrow morning. I would ask that this request be considered, since I believe it to be very reasonable, and, in any event, I would ask that the vote we were going to hold tomorrow on prior referral to the Court of Justice be delayed until the day after tomorrow, when we have heard the Commission’s speech. 
President.
   I thank all colleagues who have contributed to that exchange of views. A number of you have remarked how several different committees and resolutions over recent weeks and months have indicated the probability of going to the Court of Justice, of which I have been aware as I have keenly followed the issue. However, the event which triggered the referral to the Court was the letter of last Wednesday afternoon, which I received from Mr Gargani on behalf of the Committee on Legal Affairs and the Internal Market. This is the first time I have had the duty and opportunity, as President, to look into the question.
In light of the exchange of views, I propose that we proceed to the debate in substance tomorrow. We will hear what Commissioner Patten has to say, along with the opinions of different colleagues. In the light of all the available information, the vote will take place at noon on Wednesday. That brings us to within 24 hours of our ultimate deadline in terms of our right to refer to the Court, so we are still working within the time limits that apply here.
Because of the volume of business this week, we have added an extra sitting tonight. I suggest that those colleagues who wish to make a 'one-minute speech' submit what they wanted to say in writing, and I will try to follow up on their comments. For anyone who insists on speaking, the Rules provide that the item can be taken later in the sitting. I therefore propose to take the item at the end of business this evening, rather than at this stage.(1) 

President.
   The next item is the report (A5-0227/2004) by Johannes Voggenhuber, on behalf of the Committee on Constitutional Affairs, on respect for and promotion of the values on which the Union is based. 
Voggenhuber (Verts/ALE ),
   . – Thank you, Mr President; ladies and gentlemen, it may perhaps be said that the earlier debates on Mrs Boogerd-Quaak’s reports on the freedom of the media and the exchange of airline passenger information have dramatically demonstrated how important it is to prepare for crises in good time, how difficult it actually can be to defend our Union’s core values when under great pressure and in crisis situations, and how important it is that we should arrive at common principles and procedures. That is why I am glad that the committee accepted by an overwhelming majority the report on respect for, and promotion of, the values on which the Union is based, which I am presenting to you today.
In doing this, Members belonging to all the political groups signalled their unanimous determination to defend fundamental values and the Union’s principles of democracy and of the rule of law, values against which international terrorism has declared itself to be targeted, but which can lead to conflict in combating that same terrorism, that are also jeopardised by rising xenophobia, by racism and anti-Semitism in Europe, as well as by political extremism. It makes no sense to close your eyes to it; I believe instead that the times demand that we prepare ourselves for it.
I am grateful to the Commission for, by its communication, making an essential contribution to the dialogue between the institutions and to close cooperation between them, which I regard as indispensable where the application of Article 7(1) and (2) is concerned. Although the rapporteur and the committee both had criticisms to make of the Commission communication, I do believe that we have, today, been able to make a number of proposals as to how this position might be further developed.
It appeared both to me and to the committee that a higher level of protection than that proposed by the Commission was indispensable, especially in drawing a distinction between a clear risk under Article 7(1) and a serious breach, as was, in our view, the incorporation of the Charter of Fundamental Rights into the Constitution. Although the acceptance of this by all the institutions and the governments of the Member States does not make it binding in law, it is binding in a political sense, so that decisions taken by reference to Article 7 are discretionary and political, and can therefore be taken only on the basis of it and in full accord with it.
The committee was rather disconcerted – as indeed was I myself – by the lack of appreciation of Parliament’s particular responsibilities, which are virtually absent from the Commission communication. According to Article 7(1) Parliament possesses the power of initiative, and both paragraphs accord it the right of approval. What this means is that whether or not the criteria and principles that Parliament chooses for this procedure are actually recognised by other institutions as well will be a quite essential consideration. In my report, I originally proposed an interinstitutional agreement to embed these principles and make them binding on the other institutions, but I wholly accept the committee’s decision to initiate an interinstitutional dialogue on this.
The report proposes very definite principles, which I hope are also forward-looking, and these are meant to deal with the qualms and misgivings felt by Members of the House, and also by other committees.
The principle of confidence states that it is for our Member States, through their constitutions and institutions, to take active steps to defend the fundamental rights and values of the Union against breaches and the risk thereof; we are also persuaded that they must also be willing and able to do so. This House reiterates and affirms that it has this confidence. Secondly, with regard to the principle of plurality of opinion on the basis of democracy and the rule of law, we reaffirm Parliament’s intention that Article 7 must never be used as an instrument of political opposition. The principle of equality also applies, despite the widespread misgivings about it, and it is intended that it should be embedded, in other words, that Member States should be treated equally, irrespective of their size, their contribution to the Budget, or the length of time they have been Member States. I will conclude by saying that I attach particular importance to the principle of openness.
Although neither I nor anyone else here wants things to go that far, this procedure will, if it does so, give rise to major tensions. The debates at the start of this session showed us how very difficult it will be, in a state of emergency, to implement such a procedure with confidence, wisdom, and fairness. It is my belief that, in the event of such a procedure, Parliament would need a great deal of public credibility and so, contrary to what the Commission proposes, it is not a separate procedure that such circumstances require, but the absolute openness of all procedures, which the possibility of sanctions makes all the more necessary.
That, Mr President, brings me to my conclusion. Parliament believes that the sanctions issue must indeed be addressed, and that it cannot be the subject of speculation, so that nowhere – whether outside the EU or within it – can there be even the least doubt about this Union’s determination to use all the means available to it in the defence of fundamental rights, democracy and the rule of law. 

Byrne,
   . Mr President, firstly, I would like to thank the rapporteur for this report which replies to the Commission's communication on Article 7 of the Treaty on the European Union. In that communication, which was addressed to the European Parliament and the Council, the Commission aimed to provide a framework for analysis of the conditions for the application of Article 7 of the Treaty on European Union in order to initiate a dialogue with the other two institutions responsible for implementing this important provision.
The Commission is pleased with the favourable reaction of Parliament to the principle of this Commission initiative. Fundamental rights and the rule of law are the foundations of the European Union and a significant departure by any Member State from these values threatens to call into question the common values upon which the Union was built. For this reason, the Commission's communication underlined prevention as a means of obviating the need to resort to Article 7 or, in any event, to impose the penalties provided for by this Article. Evidently, penalties should still be resorted to if necessary – let us be clear on this particular point.
As the draft resolution rightly stressed, the Union must first and foremost have confidence in Member States and their own institutions, for example the constitutional courts. However, as part of a preventive approach it is undoubtedly necessary, as has in fact been requested by Parliament, for the Union to monitor respect for fundamental rights, and for independent European expertise to be developed in this area. As you are aware, we have put in place a network of independent experts which my colleague Mr Vitorino commented on at length at the last part-session during the debate on fundamental rights in the Union. Prevention also requires cooperation between institutions and the Member States, dialogue with citizens and information and education of the public.
A point meriting particular attention, and with which the Commission fully concurs, is the reference to the principles that must be respected when considering whether to enforce Article 7. These are the trust that should govern the EU's relationship with its Member States, the respect for pluralism, the principle of the equality of the Member States and the principle of the transparency of the decisions taken under Article 7.
I note also that the report considers that the role of the Vienna Monitoring Centre could be revised with a view to providing 'independent and objective scrutiny on a broader basis'. This is in line with the European Council's decision in December 2003 to extend the Centre's mandate to convert it into an Agency for Fundamental Rights, which is supported by the Commission.
I would like to take this opportunity to confirm that the Commission is currently studying ways of implementing the preparatory activities of the NGO support programme in the new Member States, in the areas of respect for the law, democracy and fundamental rights, in line with Parliament's wishes. This confirms the shared determination of the Commission and Parliament to encourage civil society to take action to support fundamental rights based on a preventive, positive and constructive approach.
To conclude, the Commission welcomes the recognition of the importance of interinstitutional dialogue regarding the launch of the Article 7 mechanism. As I said before, this is in line with the aim of the Commission's communication, which was to institute a dialogue with the two institutions in order to develop a common approach. 
Oreja Arburúa (PPE-DE ).
    Mr President, I would firstly like to congratulate the rapporteur on his report and point out that I am speaking on behalf of the Group of the European People’s Party (Christian Democrats) and European Democrats and on behalf of a fellow Member who has not been able to speak.
There can be no question that the PPE-DE Group has always defended the fundamental rights and values that we in the European Union represent. The European Union promoted by the founding fathers in the 1950s was not intended to be an economic union, but a union based on certain fundamental values which we must guarantee, as the rapporteur has said. My group largely supports his report, although several amendments have been tabled, but we will vote in favour of the proposal the rapporteur has made in this report.
I am delighted that in Nice some of these values were incorporated into the constitution and that provision was made for establishing a mechanism under the terms of Article 7 in order to guarantee that values are respected within the European Union. I come from a country which has been attacked by terrorists over the last 30 years, and which, furthermore, was savagely attacked on 11 March, and, as the rapporteur has said in his speech, terrorism can only be tackled by means of more values, more democracy and more fundamental rights and the European Union must, therefore, be capable of guaranteeing respect for these values within the Union, in order more effectively to combat terrorism, attacks on our values and attacks on European values.
I would like to say finally – in relation to the rapporteur's report – that we share the principles expressed in it – trust, priority, equality and publicity – which can allow us to make progress on establishing a mechanism which prevents certain States from failing to respect the values which are so important to defend in the European Union, and in this very Parliament more than anywhere else. We also support his proposal to establish an interinstitutional mechanism to promote dialogue between Parliament and the Council as from the next legislature. 
Leinen (PSE ).
   – Mr President, the Group of the Party of European Socialists, on whose behalf I have the honour of speaking, also thanks the rapporteur for a very important report, one that is a key element in making the European Union a democracy capable of defending itself. In both Conventions – both that on the Charter of Fundamental Rights and that on the Constitution – our group was very active in contending that the EU is not merely an economic community, but also a community of values, one whose foundations have been laid over centuries, and one that is willing to defend democracy, freedom, human rights and the rule of law throughout its territory.
This Union of ours is a great thing, extending from Estonia to Portugal, and we have to ask ourselves what holds it together. It certainly is not the market that constitutes Europe, but rather the sense of solidarity derived from our values. Such is Europe, such is our identity – and that we must not lose.
We do of course need a mechanism to guarantee the maintenance of these values. The public would find it incomprehensible if a Member State were to get out of hand without the EU doing anything about it. We do not, of course, want to interfere in a state’s internal affairs – we are a Union with a great deal of pluralism and much diversity – but, when there is evidence of clear risks and of long-standing breaches of these values and principles, that is the time for the EU to act. I am very glad to hear the Commissioner say that such action may even involve sanctions. Cutting off funds from Brussels, not to mention withdrawal of the entitlement to participate in decision-making bodies, is of course the sharpest weapon one can use, but we have to make clear our willingness to introduce it if necessary.
I see Parliament as having a particular role to play in this, and that has been emphasised in the report, for which let me reiterate our thanks to Mr Voggenhuber. 
Kaufmann (GUE/NGL ).
   – Mr President, exactly seven years have passed, and still neither the Council nor the Commission have proved themselves capable of devising a procedure to implement Article 7, an article once trumpeted abroad, at the time of the Treaty of Amsterdam, as a vital policy innovation in the EU Treaty. The lack of definite procedural rules, though, means that the paper asserting the values of the EU has to be patient. Without such a procedure, the whole article remains a paper tiger. Such a situation is not exactly calculated to make the European Union more credible in the eyes of its citizens; you are all aware to what a depth that credibility has fallen in all our Member States. Putting it politely, I have to say that I am disturbed by the Commission communication that this report takes as its starting point. It is extremely disturbing that the Commission quite obviously does not want to impose penalties on Member States in the event of serious breaches of the Treaties. It evidently wants to fool us into believing that everything in our garden is lovely and is going to stay that way.
What else can it mean when the Commission, on page 14 of its communication, states bluntly – and I quote – that ‘it will not be necessary to apply penalties pursuant to Article 7(3) of the Union Treaty and Article 309 of the EC Treaty’? Such an absolution of responsibility would markedly diminish our own high expectations of our shared values and, ultimately, the standard of protection for fundamental rights and values in the EU. It also reminds one of the oft-used repressive phrase to the effect that what is not allowed cannot happen.
Even more serious is the Commission’s ostrich-like and nonchalant attitude to the protection of fundamental rights in time of war, and this is where the real scandal lies. The real scandal is the way in which the Commission virtually serves up fundamental rights in the EU in time of war on a silver platter. Let me quote from page 8 of the Commission communication: ‘On the contrary, a serious breach presupposes that the danger should have become a concrete fact.’ Purely hypothetically, the adoption of a law abrogating procedural safeguards in time of war would be a clear risk. Actually using such a law, on the other hand, would be a serious breach.
That really is something to be savoured; the Commission regards a law, in a Member State, abrogating fundamental rights, as no more than a clear risk rather than as a serious breach, without even mentioning the possibility of penalties. No, this is not on. This represents a point beyond which Parliament cannot allow the Commission to persist in going against the flow of fundamental rights, and so I am glad that Parliament has taken the initiative, in the shape of the Voggenhuber report, so that now, seven years after Amsterdam, something is at last being done.
In relation to this, I have proposed a number of amendments aimed at making the draft text more precise. In particular, these relate to the obligation placed on the EU by the Convention’s draft constitutional treaty, in its Article 3(4) in Part I and in Article 193(1) in Part III, to abide by international law, and I think that the Iraq war, which was contrary to international law, and all the misery inflicted on that country by the occupying forces, is evidence of the need for further tightening up of the report’s motion for a resolution. 
Berthu (NI ).
    Mr President, the Voggenhuber report and the Commission communication on which it is based demonstrate only too well how Article 7 of the Treaty on European Union can become an infernal machine enabling the Union, in the name of preventing or penalising real or alleged violations of fundamental rights, to subject Member States to greater external supervision. In other words we are seeing in outline the development of a central disciplinary system which will be able to impose on national democracies extensive or arbitrary definitions of their obligations.
Paragraph 3 of the report gives a good example of this when it suggests that States which tolerate, and I quote, ‘a climate or social conditions in which individuals… feel threatened’ could be condemned. This sort of definition can go a very long way, particularly since Article 7 applies not only to the rights provided by the Union, which may be increased in future by the Charter of Fundamental Rights, but also to purely national competences, as the Commission communication clearly explains.
Paradoxically, therefore, there is a risk that in the name of respecting human rights a highly undemocratic multilateral surveillance system will be set up. The Committee on Legal Affairs and the Internal Market has delivered a very negative opinion on the report and it is right to do so. I took a similar line in the minority opinion which I expressed following the vote by the Committee on Constitutional Affairs. 
Martin, Hans-Peter (NI ).
   – Mr President, Mr Voggenhuber has just laid stress on the principle of openness, and I would just like to make a few brief observations on it. Let me say, while we are on this subject, that I well recall the arbitrary treatment meted out to my own country, Austria, in relation to what we are talking about. The Austrian Socialists, who have for some time now been calling themselves Social Democrats, were fully involved in the underhand manoeuvres that were going on at the time. I also have very precise recollections of a telephone call from the then Austrian Chancellor, Viktor Klima, a Socialist, who was fully in the know and told me that all he demanded of me was that nothing should get out. Never again must principles of this sort be applied in this fashion, whether in party politics or in affairs of State, for without transparency there is no democracy. It is precisely for this reason that tracing the course of these events and making them accessible to the public is so very important. 
President.
   The debate is closed.
The vote will be on Tuesday at 12 noon. 
President.
   The next item is the joint debate on:
- report (A5-0191/2004) by Evelyne Gebhardt, on behalf of the Committee on Committee on Legal Affairs and the Internal Market, on the proposal for a European Parliament and Council regulation on cooperation between national authorities responsible for the enforcement of consumer protection laws ('the regulation on consumer protection cooperation');
- second report (A5-0224/2004) by Joachim Wuermeling, on behalf of the Committee on Legal Affairs and the Internal Market, on the proposal for a directive of the European Parliament and of the Council on the harmonisation of the laws, regulations and administrative provisions of the Member States concerning credit for consumers;
and
- report (A5-0188/2004) by Fiorella Ghilardotti, on behalf of the Committee on Legal Affairs and the Internal Market, on the proposal for a European Parliament and Council directive concerning unfair business-to-consumer commercial practices in the Internal Market and amending Directives 84/450/EEC, 97/7/EC and 98/27/EC (the Unfair Commercial Practices Directive). 
Byrne,
   . Mr President, just a year ago this Parliament adopted its resolution on the Commission's new consumer policy strategy for the next five years. We are discussing today three key proposals within the context of that strategy. I am particularly pleased that Parliament has decided to discuss them jointly, as all three pursue the objective of boosting consumer confidence in the internal market.
Consumer purchases represent close to 60% of the EU's GDP. A loss of consumer confidence – even by a small amount – can have significant repercussions for our economy and collective wealth. Last month, at the spring European Council, the Heads of State and Government took stock of our pursuit of the Lisbon Agenda, which aims to boost the competitiveness of our economy. It would be no exaggeration to say that there is definitely room for improvement in this respect. Consumer confidence is good for business and would contribute to boosting our competitiveness.
The European Union has come a long way in eliminating barriers in the single market. In tearing down regulatory barriers we must, however, realise that consumers – the demand side of the market – are also confronted with barriers, namely confidence barriers. Not addressing these confidence barriers would not only be irresponsible but also very damaging to the interests of consumers and businesses alike. It would also put a heavy burden on our ability to meet our competitiveness objectives set out in the Lisbon Agenda.
The proposals we are discussing today will allow us to maximise the benefits of the single market for consumers. I would like to thank the three rapporteurs from the Committee on Legal Affairs and the Internal Market for their hard work on these proposals, as well as the rapporteurs from the committees providing opinions for their time and effort.
I turn first to the proposed regulation on enforcement cooperation. It addresses what has always been the weak point in consumer protection: the effective application of the law. In cross-border cases, problems increase because national enforcement mechanisms are not designed to deal with such cases. Rogue traders who seek to cheat consumers have spotted this and are more prevalent in cross-border cases than in domestic ones, targeting consumers across borders through the post, by e-mail or via websites. To deal with this, the proposed regulation sets up a network of public enforcement authorities, with at least one in each Member State. The effect of the proposal will be that national authorities can cooperate quickly and effectively in tracking down rogue traders and stop them from harming consumers and legitimate businesses.
This regulation will send a strong message to European citizens, telling them that the EU is relevant to their day-to-day concerns and that they can have greater confidence in shopping throughout Europe.
I would like to thank Mrs Gebhardt and colleagues who worked with her towards a compromise agreement with the Council allowing for the adoption of the proposal in a single reading. The compromise that was negotiated between the institutions ensures that enforcement authorities will at last have the necessary tools at their disposal genuinely to cooperate in cross-border cases. At the same time, it respects the various traditions that exist among the different Member States, with some relying more on public enforcement and others relying more on private actions.
I am aware and indeed concerned that some of you would prefer the opinion of the lead committee, which is expressed in Amendment No 29, over the compromise solution contained in Amendment No 76, which has been worked out with the Council. Pursuing this approach risks leading to prolonged discussions with the Council and to a second reading, further delaying the creation of an effective enforcement mechanism capable of dealing with rogue traders.
I see no reason why either our businesses or our consumers would in any way benefit from such a delay. The amendments tabled and supported by some in no way enhance the effectiveness of the mechanism, neither do they present a meaningful contribution to safeguarding established national mechanisms and traditions. I therefore urge all Members to stick to the compromise.
This is the last legislative part-session of this Parliament before the elections. It is therefore also your final opportunity to ensure that when you have to inform your voters about precisely what you have done to further consumer interests and the enforcement of law, you have a tangible example to show them.
The second proposal on the table today is the proposed directive on consumer credit. There is broad agreement that a new directive on consumer credit is both necessary and desirable. The market and the products have evolved considerably since the mid-1980s and the existing directive is no longer adapted to new developments in the area of credit. This new directive is necessary to allow the emergence of a real single market in consumer credit. It is desirable in order to achieve a high level of consumer protection in line with the consumer policy action plan endorsed by the European Parliament.
This is the reason why I consider a full harmonisation approach the only means to really create a level playing field for lenders throughout the EU. Many of you have called, and will call, for minimum harmonisation, allowing Member States to top up the rules at national level. This would, however, mean maintaining differences between national legislations. It will continue to ensure that the credit market remains a domestic and local market, depriving consumers of all the advantages a single credit market could offer them. It would not improve legal certainty for creditors and consumers contracting across borders. It would not help to develop a genuine single market in consumer credit. The full harmonisation approach will not lead to a lowering of consumer protection standards, as we have rightly chosen a high common level of protection as the starting point. Moreover, I would stress that the harmonisation applies to only those areas actually covered by the directive. In areas that fall outside the scope of the directive, Member States remain free to maintain their own national provisions. Full harmonisation will improve the overall level of consumer protection in the EU and facilitate the provision of cross-border credit.
Last, but not least, I come to the framework directive on unfair business-to-consumer commercial practices. This proposal aims to put in place a high common level of consumer protection against unfair business-to-consumer commercial practices EU wide. In doing so, it will stimulate consumer confidence and ensure that rogue practices can be addressed wherever in the EU they arise. Just as importantly, it will reduce the barriers that prevent legitimate businesses from making the most of the internal market and reaching new consumers. Both businesses and consumers will benefit from the security of having one set of rules rather than 15 or, from 1 May, 25. Both business and consumers will therefore be better placed to take advantage of the enlarged internal market. This in turn will have a positive effect on the competitiveness of the EU economy as a whole.
I will leave it at that for the time being and look forward to hearing your views. 
Gebhardt (PSE ),
   . – Mr President, Commissioner, ladies and gentlemen, over and over again we hear of the underhand machinations of rapacious businessmen, in whose nets members of the public have been caught, but from which it is often possible to extricate them. All the Member States have precautions in place to protect consumers, whether this is done using public authorities such as the UK’s Office of Fair Trading or France’s , or by such bodies as the Dutch or the in Germany.
All of them help if, for example, a letter lands on your doormat telling you that you have won a prize in a lottery, and that all you have to do to get it is to sign and post the form, so you do and off it goes. A week later, you get goods you have not ordered, which you are told you have to pay for. Alternatively, you fall for one of the slimming courses that are on offer – particularly frequently in young people’s magazines in recent times – the effectiveness of which is much exaggerated and whose side-effects are glossed over. Perhaps you have been enticed by an offer that has turned out to involve ‘modem jacking’, in which a website offers you the chance to download music free of charge, you accept the offer, and, in the course of the process, you, the customer, without being aware of it, are cut off from your usual Internet Service Provider and attached to another one that is much more expensive. Only later do you get the bill.
In most cases of fraud, the national authorities can provide help. It is something like 20% of cases that matters become problematic, when the only known address is often a PO Box in a foreign country. In such situations, good advice soon becomes invaluable.
This draft piece of legislation is of great importance in terms of dealing with cases such as these. Legislation is also urgently needed, for problems are piling up, and we should not leave the public to their own devices. That is why, as your rapporteur, I acceded to the wish of the Irish Presidency of the Council that the legislation should be adopted, if at all possible, in only one reading. What is on the table is what has emerged from negotiations. I also want to put on the record my thanks to the Commission for its active help in achieving this result.
This legislation is primarily concerned with mutual assistance in enforcing consumers’ rights, for which every Member State is to set up a public office to function as the point of contact for the authorities in other Member States, although I wish to stress that no Member State will be obliged to set up a new authority. It is for the Member States to decide how to allocate the functions described in this Regulation to existing authorities. This is not about creating bureaucracy, but about successfully putting a stop to the fraudulent schemes of a few rogue traders, who use cross-border businesses as a front.
To this end, public agencies can, by mutual agreement, delegate the handling of cases to non-governmental organisations, and this is the traditional practice in Germany, Austria and the Netherlands. I am working on the assumption that, in these states the norm will be for tasks to be handed over to time-tested bodies such as consumers’ associations or business self-regulators. On that, I believe, depends my recommendation, as rapporteur, to my fellow-Members that they should vote to accept this compromise text. The only exceptions I can envisage are where statutory bodies have to exchange particularly sensitive data, but we have made definite arrangements for that in this document.
By agreeing to this draft legislation, we can redeem a pledge given by all of us as MEPs, our pledge that we would commit ourselves to dealing with the public’s concerns. I hope that, tomorrow, we will do so with a resounding yes.
Wuermeling (PPE-DE ),
   . – Mr President, Commissioner, ladies and gentlemen, honoured visitors, I would like to start by thanking most warmly all those who have played their part in drawing up this report, which is a very complex and comprehensive one. We were, unfortunately, obliged to consider a Commission proposal that was not entirely consistently thought through, that was sloppily worded and had not taken account, above all, of the serious consequences it would have for consumers, for example on their access to credit. We in the committee therefore had to propose extensive changes to this directive, achieving the sad record of 650 amendments to what have to date been 38 articles, but your concentrated collaboration means that it has now been possible to assemble all this into a genuinely consistent whole.
Nor must I let this opportunity go by without very warmly thanking Parliament’s Bureau and the groups’ secretariat, not to mention my own staff, for the endless hours they devoted to this project.
I can tell the House that what the Committee on Legal Affairs and the Internal Market wishes to do by means of this proposal is to send out three signals. One carries the message that the European internal market needs the best possible consumer protection. We will achieve this if we combine the European Union’s minimum standards with the legislation of individual states, but if, on the other hand, we were to take the approach of harmonising everything or as much as possible, that would amount to only the minimum of protection for the consumer. This is where I want to express my disagreement with what Commissioner Byrne had to say.
The fact is that I get the impression that what matters most of all to the Commission is that consumer law in this area should be completely centralised, with the European Union alone being entitled to do anything that has to do with consumer protection. That would not, however, be objectively reasonable, as the national markets still differ to a large extent, and it is there that there must be a rapid and flexible response when improper business practices crop up.
Secondly, we are sending the message that financial markets need to be opened up to individual consumers too. We want the standards of protection not only to enhance public confidence in commerce and in buying by mail order, but also to encourage the public to seek out offers throughout the internal market in order, eventually, to find credit on favourable terms.
Thirdly, we are signalling our opposition to over-regulation and bureaucracy, for there is, quite simply, no sense in deluging ordinary customers – responsible adults though they may be – with a flood of information that they cannot read, let alone understand; hence our proposal for clear technical information that will provide consumers with the key facts on their loans at a glance.
We also made it our concern to maintain access to credit facilities particularly for the man and woman in the street and for the vulnerable members of society. It is these sectors of the population who need short-term loans simply to stay on top of day-to-day life. The end result of the Commission proposal would have been that the only people who could get credit would be those who had no need of it.
There are two more specific points I would like to address briefly, and these are still subject to discussion between the groups. The first has to do with the entitlement to early repayment. One position on this is that this should generally be permitted, and without any additional costs being incurred, whilst the other is that consumers should be allowed to choose between fixed-term loans and those capable of being repaid early. In view of the fact that we have still not yet come to an agreement on this, let me draw still closer to the Group of the Party of European Socialists; you will have seen that I have already tabled a compromise amendment, Amendment No 173, in which I propose that, where loans are taken out for a period of over three years, it should be possible to repay them at any time. I would now like to add to that by combining it with Amendment No 96 as recommended by the committee, whose effect is to bring about a commensurate reduction in costs in this case.
Even though there are some points from today’s debate that I wanted to mention, let me bring this speech to a close. I see this package of reports – Mrs Gebhardt’s, Mrs Ghilardotti’s, and my own – as the culmination and conclusion of our legislative work in the field of consumer law. We have always managed to discharge our responsibilities in a state of tension between the demands of the internal market and those of consumer protection, and what we have put before you I see as being a single piece of mature legislation. Whatever our differences about the details, then, I hope that they will receive the general support of the House. 
Ghilardotti (PSE ),
   . Mr President, Commissioner Byrne, ladies and gentlemen, the proposal for a directive concerning unfair commercial practices takes over a large part of the Green Paper on consumer protection, referred to by the Commissioner in his report.
The reasons underlying the directive, which is designed to achieve higher consumer protection, are of an economic nature, and therefore relate to the completion and smooth operation of the internal market. In order for these general economic goals to be achieved, it is necessary to have a consumer protection policy to create European consumer confidence and to give a fresh impetus to international and European commercial transactions. The benefit of economic growth in the internal market ought to translate into both higher profits for businesses and higher protection and financial benefits for consumers. Through a joint policy for consumers and the harmonisation of the internal market it will also be possible to achieve price convergence. Conversely, unfair commercial practices lead to irrational financial behaviour in consumers, create distortions of competition and place barriers in the way of the proper functioning of the market.
To this end, I endorse the Commission's approach, which is based on harmonisation, on the principle of mutual recognition of the country of origin, on a general prohibition on unfair commercial practices, on the identifying of specific criteria and examples and on the fact that the scope of application is limited to a framework directive based on business-consumer relations. The creation of a European legislative framework covering unfair commercial practices based on an appropriate level of harmonisation and aimed at clear and effective protection of consumers within the European Union will result in enhanced consumer confidence, an increase in international trade and will allow businesses to compete in a situation of legal clarity.
While endorsing the basic approach and the main objectives of the directive, Parliament is nevertheless tabling a raft of amendments which, in our opinion, make a series of definitions and options clearer and unequivocal. In this regard, we have tabled an amendment concerning the legal basis, that is, a proposal to include, in addition to the legal basis proposed by the Commission in relation to the internal market, a legal basis based on Article 153 concerning consumer protection, so that we can reconcile the objective of harmonisation and mutual recognition of the internal market with the possibility for the Member States to maintain legislation which goes further to protect consumers. In this way, I believe that we can respond to the fears of those who think that greater harmonisation could lead to downward levelling of consumer protection or entail a step backwards with regard to existing legislation in many Member States. We also feel that it is important – with regard to the definition of consumers – to refer to a particular group of consumers, specifically vulnerable consumers who, as a result of various factors such as age, physical or mental abilities, their level of literacy or disability, need greater protection. Again with reference to Article 2, in relation to the definitions, it is important to amend the definition of professional diligence and I will retable an amendment in plenary in this regard.
In essence, we support the Commission’s approach to the regulation of misleading and aggressive practices but we stress, though, that the information which consumers must receive about unfair commercial practices and codes of conduct is an essential element. Similarly we also think, in relation to codes of conduct, that the distinction between national and Community codes is slightly artificial, and we therefore point out the need to provide for appropriate, efficient mechanisms for monitoring and enforcing compliance with the codes.
Another important point, which concerns the codes of conduct as a method of regulating and resolving disputes between businesses and consumers, is arbitration, which cannot and should not replace or prevent recourse to administrative bodies, but which could play an important part.
Therefore, as my fellow Members and Commissioner Byrne also pointed out, adoption of this directive and tomorrow’s report is of the utmost importance both for the development of the internal market and for consumer protection.
I will conclude by thanking all my fellow Members who sought to improve this document and find a solution with their contributions. In particular, I would like to thank Mrs Paciotti, who deputised for me for a time when I was absent owing to ill health, and did an outstanding job on my behalf. 
Berès (PSE ),
   .  Mr President, to speak for only one minute on a report which we have been concerned with for such a long time will be difficult. Thank you, Commissioner, for your proposal; it provides a basis to work on. Happily, this Parliament will separate after working on that basis. You know that we support the ambitious concept with which you began, that of total harmonisation, but we can see how difficult it will be to push through. Perhaps we should do more work around that concept, in order to achieve real consumer protection, which is what we are interested in.
As for the clarity and efficacy of this text, it seems to us that what Parliament is actually proposing on the subject of harmonised rates is a useful path to follow. We retain only one rate, the overall effective annual rate. That will make things much simpler for everybody. Let us bear in mind, however, that consumer goods are goods for which credit is a particular kind of credit, inasmuch as, as soon as that credit is contracted, the goods are no longer the subject of credit but rather, in a way, of a debt, since the goods lose their value as soon as they are purchased.
There are two points to which my attention has been drawn in particular, Commissioner, and, of course, these concern the scope of this directive. As you are aware, practices and conventions vary within the European Union, so that between mortgage credits, between personal loans, and between credits allocated there are very different balances from one Member State to another, and we have to face up to the reality of the mechanisms and risks of dumping which exist as a result of different national practices.
Clearly, if you remove mortgage credits from this directive and move them to another directive you will be opening up the field to the banks, which will take advantage of mortgage credits to attack other consumer credit markets. I do not think that that is the objective sought by this directive which should, first and foremost, protect all forms of consumer credit. 
Patrie (PSE ),
   .  Mr President, strengthening consumer confidence is indeed essential to the development of the internal market, as you, Commissioner, have pointed out. Yet that confidence is based on consumers’ ability to conclude, without incurring any legal or economic risk, all kinds of commercial transactions, in particular by means of new electronic trading procedures.
The systems for preventing and penalising infringements of consumer laws currently in force in Member States generally function in the context of national markets, but are unsuitable for use at Community level. This deficiency obviously works to the advantage of unscrupulous operators, to the detriment of consumers and honest traders.
We can, therefore, only welcome the Commission’s initiative, which consists in setting up a network of authorities which are able to cooperate with one another in order to rid the internal market of dubious practices, although I, for one, would have preferred us to opt for a network that would be completely public in nature, along the lines of the committee’s original proposal.
Bearing in mind the need to take into account the diversity of Community practices and the urgent need to make this instrument available, however, I believe it is reasonable to adopt the compromise which has been achieved, in particular thanks to the work of our rapporteur. I would therefore like to express the hope that a real spirit of mutual assistance will prevail in the cooperation between Member States. 
Whitehead (PSE ),
   . Mr President, I would like to say how pleased we are that Mrs Ghilardotti has recovered and is with us today.
This is a debate about people and our concerns for them. I would like to say, on behalf of the Committee on the Environment, that we very much support what the rapporteur has said on unfair commercial practices, that is, that the principle of the vulnerable consumer must be accepted and recognised, that we must take into account disparities between national protection rules, that we must insist on a double legal basis and that the principle of optimum harmonisation should hold good for all three directives.
In my remaining seconds I would just say that I am very grateful indeed to the rapporteur, Mrs Gebhardt, on the issue of enforcement for accepting that each state should be allowed to decide how the regulation should be implemented by the public authorities, but according to Amendment No 76 it will be implemented by public authorities in alliance with, but not supplanted by, other public interests and by NGOs. This is a good day for consumers and, despite the rather stunted debate we have had, we should shout that fact from the rooftops. 

Thyssen (PPE-DE ).
    Mr President, the fact that we can complete this part-session with a debate on three important consumer matters is not only symbolic; it also provides us with the opportunity of re-emphasising our genuine desire to reinforce the human character of the internal market, and it also affords us the opportunity of clarifying that the internal market is also there for the consumer and that we want to, and must, boost consumer confidence.
As far as the framework directive is concerned, our group’s guiding principle is that a high level of consumer protection is a prerequisite for the actual application of the principle of mutual recognition. We accept the restriction of the scope in respect of the industry-consumer relation. However, in order to clarify the connection between this framework directive and the competition-related aspects to everyone, we would still like to table amendments.
To our group, the average consumer remains the point of reference. We accept that further amendments will be tabled, but these amendments may not go so far as to fundamentally depart from the option. In addition, we remain adamant that it should explicitly be stated that the black lists of aggressive and misleading trade practices are exhaustive in character and that the directive’s harmonisation objective may not be undermined. If the black lists are amended, we believe this should be done by way of the codecision procedure. We also remain convinced that a double legal basis for the framework directive is not justified, not necessary and surplus to requirements. We will therefore follow the legal recommendation of our Legal Service and endorse the reasons that we have previously clarified in the various committees.
During this part-session, as in past ones, we have enacted much fine legislation on consumer protection, and it has only been thanks to Commission proposals that we have been able to do this. I would therefore echo everyone who wants to thank the Commissioner today for the proposal we have received, for without the Commission proposals we would not have been able to do the work. It is, of course, the case that, no matter how many fine laws we enact, legislation depends entirely on their effective implementation and enforcement. That is why I am a great fan of the Commission proposal to develop a network of administrative bodies that are responsible for the application of all those fine consumer directives. I very much welcome this Commission proposal.
I hope that the Members of this House will reconsider the amendments, because I know that there are people in our group who would very much regret it if we were to end up with a regulation that is all too bureaucratic and involving a great deal of red tape. We would regard that as indefensible. We should therefore ensure that we get a maximum number of votes to approve the proposal for a network. We should ask the Council to reconsider the matter. After all, it should not always be the case that we adapt to the Council’s position. We agree on a great many points. We should, for once, ask the Council to adapt to Parliament and respect democracy. 
Medina Ortega (PSE ).
    Mr President, on behalf of the Socialist Group, Mrs McCarthy and I have tabled a total of 25 amendments to the proposal for a Directive on consumer credit, for which Mr Wuermeling is rapporteur.
As we know, there was an initial stage of indecision, during which the rapporteur thought that the directive was being modified in committee, which led this proposed directive being referred back to the Committee on Legal Affairs and the Internal Market, but, fortunately, we managed to resolve the issue and finally the rapporteur decided, in agreement with us, to present it once again with a series of amendments.
Our problem is lack of time. This term of office is coming to an end. During this term of office, Parliament has not been able to complete its examination of the proposed directive and we are limited to a first reading so that the next Parliament may have the opportunity to examine it in depth.
Our concern is naturally not to kill off consumer credit – which, for better or for worse, has become an essential part of our lives – and also to provide a guarantee that credit will not end up being a noose around the consumer’s neck.
Our amendments are of a different nature. Some, for example, relate to the legal basis. We believe it is important to introduce Article 153 as an additional legal basis in the field of consumer protection and, furthermore, we also believe it is important to point out certain elements in the definitions. In the definitions and above all in the adherence to certain basic principles, such as, for example, the APR – Annual Percentage Rate – which is a concept we have developed here, and we must prevent it from being replaced by other criteria which are much more difficult to understand.
In conclusion, we hope that tomorrow's vote may lead to a directive which is clearer to the consumer and that on this basis the next Parliament can definitively approve this directive which is so important for all the European Union's consumers. 
Thors (ELDR ).
    Mr President, Commissioners, I should first like to mention the proposal on cooperation between consumer authorities, which is extremely welcome, and I think that the rapporteur has done an exceedingly good job. It is both astonishing and depressing how much energy some Members have put into attempts to water this proposal down. I cannot conceive of a situation in which everyone but the consumer has rights in the internal market. That has been truly depressing, but I welcome this proposal, and hope that a large majority in Parliament will support the compromise proposal drawn up by Mrs Gebhardt.
On the subject of Mr Wuermeling’s report on credit for consumers, I must say that I welcome the fact that we are having the debate today and that we have managed to make a good deal of progress. As previous speakers have said, improvements are needed, however, because otherwise there is a risk of the directives diluting the rights that consumers already have.
Earlier on, a speaker mentioned the actual annual percentage rate of charge, and in this case, too, the Group of the European Liberal, Democrat and Reform Party and I should like to see a broader definition. The right to earlier repayment must also be improved. I do not think that the rapporteur’s compromise proposal goes far enough in this respect. As I often do in these debates, I should just like to mention the right to number portability in the telecommunications sector, which has given consumers important rights. In my home country, costs have fallen by 7% over the past year, and I think that the right to repayment has been a significant contributory factor.
I also think that better information on credit cards is needed, and that the exclusions in some amendments are not really desirable.
Finally, in my opinion, joint and several liability is really needed in order to develop the internal market and afford consumers protection when new products are placed on the market. I should also like to mention here something that happened in my home country. A new low-cost company went bankrupt, and only those consumers who had paid by credit card had any kind of protection. This also goes to show that this aspect is necessary for consumers when markets are developed. 
MacCormick (Verts/ALE ).
    Mr President, I would like to start from a local perspective. Last Friday I visited Blantyre in my constituency to talk to an alliance of Credit Unions in that part of Scotland. As the Commissioner will know very well, Credit Unions in some parts of the Union provide cheap and affordable types of safe credit to consumers through voluntary organisations carrying out voluntary effort in a non-profit way.
They were very concerned early on in the process that they may be caught in some of the technicality of this directive. I am extremely grateful to Mr Wuermeling for the way in which, in Amendments Nos 4 and 62, he has sought to create an exemption for that kind of activity. It is really very important and my constituents were very grateful to learn just how much had been done in that respect.
While there may be still issues among us about the exact balance between the consumer and the lender contained in the Wuermeling report, we are all agreed that it is vitally important to make safe the internal market so that there can be much wider trade, but not at the cost of unfairness to consumers.
I congratulate him genuinely on the work he has done. While we will be supporting some amendments against him tomorrow, it will not be at the cost of backing the general project.
The same goes for Mrs Gebhardt's proposal. We are talking about consumer rights. No rights without remedies is a good old slogan and I think that the point of the new regulation of which the Commissioner and Mrs Gebhardt have spoken is very much to secure that there are adequate and forceful remedies for rights that we all support.
Likewise, if I may say to Mrs Ghilardotti, the idea that we should begin to develop a jurist prudence of fair-trading in the European Union is a grand one. This will be done, of course, in a negative sense by generating a general duty not to trade unfairly. I congratulate Mrs Ghilardotti for all the work she has done. There may be one or two points of disagreement in the vote tomorrow, but the point is that we are all piloting the boat in the same direction. 
Van Dam (EDD ).
    Mr President, for more than one and a half years, this Parliament has been working on the Commission proposal for the harmonisation of provisions on consumer credit. That is, in our view, far too long, not least because the positions of the advisory committee were largely determined as early as before the summer of 2003. It very much looks as if the European Commission, which proposes maximum harmonisation, has wrongly evaluated the political feasibility of this. My group, on the other hand, endorses minimum harmonisation of consumer credit provisions, so that the acquired rights in the Member States remain in place. One of the acquired rights in my country, the Netherlands, is that consumers are allowed to run up a short-term debt with a bank on their current account without any extensive contracts. We call this being ‘in the red’. It is being proposed, with good reason, to delete paragraph 2c of Article 3 by means of Amendment No 52. I should like to hear from the Commissioner whether he will be adopting this amendment. Can existing practice of current-account credit remain in place under the new directive without any extra administrative steps?
Secondly, I should like to draw attention to the Commission proposal on unfair trade practices. Article 4 of this proposal states that traders need only meet the requirements that apply in their home countries. Consumers will find that incomprehensible; they want the protection that they enjoy in their own countries. This article constitutes a huge stumbling block in terms of effective consumer protection. Traders simply need to comply with the requirements applicable in the country where they introduce their products onto the market. Our group has for that reason tabled Amendment No 95 to address this problem. I hope that this will meet with approval from the House. I should like to hear from the Commissioner here whether this amendment could also be adopted. 
Sornosa Martínez (PSE ),
   . Mr President, I believe that this directive is necessary. If one thing is clear it is that Directive 87/102/EEC no longer reflects the situation in the credit market. We could say that all we Europeans are currently plagued by debt. We therefore need a directive which prevents the impression being given, when consumers are offered credit, that we never have to return the money, for two reasons which I believe to be fundamental: firstly, in order to harmonise the conditions in which consumer credit is offered and, above all – and this, incidentally, is a proposal by the Group of the Party of European Socialists – in order to guarantee consumers a high level of protection.
I regret that I do not have sufficient time to comment to the Commissioner on the amendments we consider essential in order to fulfil these two objectives at least. I do hope, however, that some of my fellow Members can do so, because consumers must be protected in an age when it appears that credit is never going to be repaid. We citizens do have to repay what we owe, but our debts are more than we can afford. 
Bartolozzi (PPE-DE ).
    Mr President, ladies and gentlemen, consumer protection is an important objective and we need to prevent dishonest traders benefiting from the internal market in order to mislead citizens by offering them defective goods. Moreover, dishonest traders take advantage of the new technologies provided by the information society, thereby undermining consumer confidence in -commerce.
These problems do not only closely concern consumers, but also businesses and the economy as a whole. In order to protect consumers, therefore, we have to establish a body of clear, effective rules and also strengthen cooperation between national consumer protection authorities, by promoting information exchange and providing for the possibility for authorities approached by consumers to request the assistance of an authority from another country. It is precisely this second, important objective which the proposal for a regulation being discussed and voted on by Parliament this week seeks to secure.
Current national systems are not capable of preventing and suppressing cross-border exploitation and existing informal networks face obstacles of a legal nature regarding, in particular, difficulties relating to the flow of information from one authority to another and even the lack of public consumer protection authorities in certain Member States.
Moreover, the regulation lays down precisely the Member States’ obligation to designate a public consumer protection authority, which will be part of a European network. The authority of one Member State may request help from other members of the network in order to investigate possible infringements, to receive information and thereby to end exploitation by dishonest traders.
The Committee on Legal Affairs and the Internal Market has provided some further guarantees in the proposal for a regulation, in order to avoid possible abuse of power by the national authorities, to protect confidential information held by businesses which is not strictly necessary to the investigation and to ensure that the requests for cooperation are reasonably justified and do not pointlessly impede traders.
The proposal for a regulation, moreover, provides for procedures which are at times a little cumbersome and onerous for consumers and the public administrations, and risk making the costs far higher than the loss or damage suffered by consumers. This is why we oppose certain provisions laid down by the Council and the Commission which would greatly complicate the system, and if we have to adopt the regulation at its reading before enlargement, we shall ensure that it is reviewed, on the basis of experience gained, five years following its entry into force. 
McCarthy (PSE ).
    Mr President, research carried out in the UK on consumer credit awareness has demonstrated very clearly that consumers need clear, consistent information to be able to make informed comparisons of the products on offer. It is true that, owing to innovation and evolution, many of today's products offer the consumer more choice and flexibility, but many are difficult for consumers to understand: 56% of consumers in the UK did not understand the terms used in credit agreements, 77% find the language in advertising confusing and while 68% are aware that lenders do not calculate APR in the same way, they do not know how the system works and find it difficult to price one loan against another, which makes it difficult for them to shop around for the best deals. More importantly, it also means that credit providers are under less pressure to keep their prices and offers competitive. If this is the case in just one Member State, imagine what the situation is like across 25. This is why the directive must provide maximum levels of consumer protection as regards advertising, information and rules on the calculation of APR and a high level of consumer protection and redress.
I would like to pinpoint two areas that the Commission should look at more seriously. Firstly, joint and several liability. In the UK, Section 75 of the Consumer Credit Act provides for remedies and redress. I understand what the Commissioner is saying: Member States can go further. However, I do not want this directive to be used as an excuse for credit providers to opt out of the very high consumer protection that is already offered in other Member States.
Cooperatives and credit unions were also mentioned. I am delighted that the rapporteur has taken on board the amendment drafted by Mr Crowley and myself. It is true that credit unions provide a very important service in that they not only offer affordable loans, but also help the poorer elements of the community – the deprived and people on low income – to stay out of the clutches of loan sharks. I fear that if the regulations proposed in this directive were to be applied those consumers in poorer areas would end up with no credit unions and no option but to turn to loan sharks. The PSE voting list tomorrow will reflect our desire not only to see the opening-up of a consumer credit market in this area but also to achieve the highest possible level of consumer protection for consumers right across Europe. 
Wallis (ELDR ).
    Mr President, it seems to me that this joint debate tonight is perhaps a fitting finale to the work of the Committee on Legal Affairs and the Internal Market in this mandate. At the beginning of the mandate we also thought that with the advent of the euro and e-commerce these would deliver a double boost to Europe's economy and the internal market. Sadly the realities have perhaps been more disappointing, particularly with regard to the participation of consumers in cross-border transactions.
There was an interesting report from the European Consumer Centres who are very much at the sharp end. This report was delivered on European Consumer Day this year. Of 114 cross-border transactions only 75 actually resulted in a delivery. There were problems with payment and problems with refunds. This is hardly the safe, well-functioning market that we had in mind to create, nor have we got the level of confidence that we really need.
It seems that in various complimentary ways these three measures will help to improve matters. The unfair commercial practices legislation should create that high level of consumer protection across the board. With the measures it contains by way of codes to help with alternative dispute resolution, combined with proper enforcement through the enforcement directive, perhaps we will get the access to justice across the market that there ought to be for consumers.
Lastly, with regard to consumer credit, there should be a provision to make sure that consumers are backed up by the credit provider: this provision exists in my own country and others. This should be extended across Europe; one of our amendments to this effect was adopted in committee. It is aspirational for the future to deliver the consumer confidence that we really need to make the market work. 
Lehne (PPE-DE ).
    Mr President, ladies and gentlemen, in view of the short time available, I want to speak only on the Gebhardt report. I appreciate the efforts that the rapporteur and the Commission have made in their desire to do the right thing in terms of cross-border cooperation. Although the usefulness of this is not a matter of doubt, I do wonder whether the proposal put before us by the Irish presidency really does represent an acceptable position and whether we might be creating a bureaucratic monster. Firstly, I think it is quite wrong that we should now, for the first time in the history of the European Union’s lawmaking, be seeking to interfere in the Member States’ right to organise the way in which they, within their own borders, transpose regulations and directives. In this instance, we prescribe that Member States may not transfer certain functions to private bodies, but that these functions must be performed by the authorities, and so that is precisely what we are doing – tampering with matters that are for the Member States to organise – which may well mean that the whole Regulation contravenes the Treaty.
My second worry is about the bureaucratic monstrosity of decision-making in the event of dispute. This I can describe only as real-life satire. The situation is that the Member State delegating the function has to consent to the Member State that accepts it entrusting the performance of the tasks to a private body. If neither that, nor the re-examination of the criteria by mutual agreement, is possible, a comitology procedure is set in motion, in which the decision rests with the Commission, so people travel to Brussels from 25 national capitals in order to decide whether or not the matter can, under the directive or a regulation, be referred to private bodies. I see that is quite disproportionate to the matter in hand.
We should respect the Member States’ exercise of their powers and acknowledge the efficient way in which they perform their functions. I therefore propose that we should stick to what was decided by the Committee on Legal Affairs and the Internal Market. The Council will do likewise when it has come to its senses. Earlier on, Mrs Thyssen pointed out that we have no reason to give way on this; it is the Council that must give way to us, and then this can be adopted quickly, in one reading, but on the basis of the motion for a resolution produced by the Committee on Legal Affairs and the Internal Market rather than on the compromise proposed by the Irish presidency. 
Karas (PPE-DE ).
   – Mr President, Commissioner Byrne, ladies and gentlemen, my point concerns the Wuermeling report, the consumer credit directive. I would like to expressly thank the rapporteur for his excellent work and the good cooperation between the committees. He had a hard task because the Commission’s draft was, to put it mildly, a bad one. The Commission’s proposal starts from false assumptions. It plays the interests of consumers against those of the banks and in many cases it actually incites the one against the other, despite the fact that Europe needs more cooperation not recrimination, more seriousness instead of populist superficiality.
We say a clear yes to consumer protection, yes to greater transparency, yes to reciprocal information, yes to lower and upper limits for the applicability of the directive. We say a clear no to more red tape for retail loans, no to making retail loans more expensive and no to the inclusion of overdrafts in this directive.
I hope that the draft Parliament has produced, based on the rapporteur’s proposals, does justice to the real intentions of this directive, which are to improve consumer protection while cutting bureaucracy, to provide greater transparency and to make for greater trust and mutual consideration, and that it will thereby promote consumer interests and cross-border borrowing.
I ask you all to vote in favour of the amendments tabled by Parliament and the rapporteur, because that is the only way to increase cooperation rather than conflict. 
Doyle (PPE-DE ).
    Mr President, I would like to restrict my remarks to Mr Wuermeling's report on consumer credit. This is his second attempt to reach a compromise on the Consumer Credit Directive, Parliament having opposed many aspects of the proposed directive and referred it back to committee in November 2003.
This directive aims to harmonise laws, regulations and administrative procedures of the Member States concerning agreements covering credit granted to consumers and surety agreements entered into by consumers. Having expressed my opposition to many aspects previously, I will be happy to support Mr Wuermeling's report provided the amendments on so-called 'responsible lending', the compulsory use of credit reference databases and the exemption for mortgages are all adopted, and provided the so-called credit union amendments, 4 and 61, are supported by this House.
The Credit Union movement in Ireland and the UK is unique. Most financial institutions that lend money are in business to maximise profits. Credit unions are different as they are owned and run by their members. Each member on their boards and principal committees is a volunteer – there are 15 000 of them in my own country – as are the majority of their staff, except in the larger credit unions which have up to 2000 paid employees. They are restricted from operating outside their local geographic area and provide mainly small amounts of credit for low-income members and for those in financial difficulty. Through the Money Advice and Budgeting Service known as MABS in Ireland, they provide access to credit for individuals who are often seriously in debt and otherwise prey to illegal money lenders providing loans at impossibly high interest rates.
In my country, where we have less than four million inhabitants, there are 2.5 million members of credit unions with savings in excess of EUR 9 billion. 37% of loans issued by the credit unions are for EUR 750 or less. The average loan is EUR 7000. A total of EUR 5 billion is out on loans at the moment. Effective leadership for all our credit unions on the island of Ireland is provided by the Irish League of Credit Unions.
In conclusion, harmonisation is needed and welcomed to the extent that it respects the different range of financial products and the cultural differences in financial services in each Member State. We need a balance here in protecting the consumer from the lender and the lender from the consumer. 
Harbour (PPE-DE ).
    Mr President, as a number of colleagues have said as regards consumer credit, good regulation will stimulate the market, encourage consumer confidence and stimulate innovation and development across the single market. The Commission's original proposal failed to do almost all these things, and Mr Wuermeling's report, which we warmly welcome, is a significant step in the right direction and a substantial improvement.
However, as a number of colleagues have said, consumer rights have to have proper enforcement mechanisms. The other two proposals being discussed tonight have that link in common. We warmly welcome Mrs Gebhardt's to achieve a compromise, which we will support because it is very important.
We have also made substantial progress in developing a workable proposal on the issue of unfair commercial practices, where enforcement is the key. There is no point in having new rights for consumers unless they can be enforced. Companies need to know where they stand in relation to their national legislation and they also need to be encouraged to adopt best practice through codes of conduct. We have moved substantially in that direction. The important proposal of mutual recognition is also absolutely essential to making everything work successfully.
In conclusion, this package is good for consumers and the internal market, and we will strongly support all three proposals. 
Byrne,
   . Mr President, I thank you for your valuable interventions on these three issues. I know that there is much common ground between Parliament and the Commission. Allow me to respond to some of the points that have been made during the course of the debate and to indicate the Commission's position on the key amendments.
Firstly, enforcement cooperation. On this regulation the Commission can accept all the amendments tabled in the plenary by the rapporteur as they reflect the compromise reached with the Council towards a first reading adoption of the regulation. Amendments that are not part of the compromise package are not supported by the Commission. Prolonging discussions beyond the compromise reached with the Council will not bring material improvements to our capacity to better enforce consumer protection rules. It would, however, provide rogue traders with more time to exploit the absence of effective cooperation between the enforcement authorities in the Member States. The compromise represents a reasonable balance between the enforcement traditions of the Member States.
The most important question in these discussions has been the public nature of the network proposed. The thinking behind the Commission's proposal was that only public authorities can deliver adequate guarantees on effectiveness and confidentiality. In a minority of Member States effective enforcement is fulfilled by financing private consumer organisations to take action on behalf of the public interest.
Amendment No 76 successfully reconciles both traditions. Those Member States with a strong tradition of private consumer bodies would be able to delegate a fair number of cross-border cases to them. In the cases which involve confidential information or which require significant investigation, in other words the most serious rogues, a public authority will be lacking.
The reference to comitology was inserted at the request of those MEPs who support delegation by Member States. For a Member State prevented by another Member State from delegating to a private body, it provides a useful opportunity to air grievances.
Amendment No 29, removing 8(2)(b) and 8(2)(c), will be completely unacceptable to Council and the Commission. Both have argued that 8(2) is a package and cannot be touched. I therefore commend that particular approach to the House.
I am happy to be debating the Consumer Credit Directive here today. It is now a little over 19 months since the Commission sent this proposal to Parliament, just a few weeks less than the gestation period of the elephant, and I suppose it is not surprising therefore that we have this weighty tome from the rapporteur. I am sure the rapporteur will understand if I do not accept all of his amendments, although I am trying to adopt a compromise approach to his position and to his report.
Many of the amendments proposed by the Committee on Legal Affairs and the Internal Market and discussed today can be accepted by the Commission. Some can be accepted partially or with limited changes. I also note that more than 200 amendments were tabled for this plenary sitting which, together with the comments from the various speakers, demonstrates that opinions are very divided. This reflects the divide in approach to consumer credit throughout the European Union. I am nevertheless heartened by the fact that on the two principal objectives, namely ensuring a high level of protection and the creation of a genuine single market for consumer credit, there is a broad consensus.
Given the number of technical issues that have been raised, it would lead me too far astray to comment on all of them. I will therefore focus on some of the main issues. I wish to reiterate that full harmonisation will not lead to a reduction in the level of consumer protection. Full harmonisation will apply to the areas for which the directive provides for such harmonisation, namely those areas most relevant to the operation of the single market. The Commission is willing to consider excluding areas from the scope of the proposal that would not affect the single market. For these areas, Member States can maintain their national provisions.
Credit intermediaries should only be submitted to national supervision. Registration requirements would no longer be foreseen. Provisions already covered by existing legislation can in general be deleted; for instance, provisions on door-step selling. The same applies to matters covered by national civil law, such as the provisions on repossession and sanctions. However, as I said before, this directive also aims at guaranteeing a high level of protection for consumers in the area of credit. I cannot, therefore, accept amendments that would lead to a reduction in the level of consumer protection.
Regarding small loans or overdrafts, it is possible to submit credit unions to a lighter regime principally based on the provision of information. I am always interested to hear Sir Neil MacCormick tell the stories of his constituents and his recent experience in his constituency. I am sure he would be happy to hear that I have been invited to my own home town of Monasterevin in County Kildare, a small country town, to open a credit union within the next couple of weeks, where I will be emphasising these points.
On mortgages, the Commission recognises that there are a number of important practical and legal problems, principally related to the fact that such loans are secured by a mortgage on immovable property. We should not, however, lose sight of the fact that increasingly consumer spending and consumer credit arrangements are financed through loans secured by a mortgage on immovable property through so-called equity release mechanisms.
The legal issues surrounding such contracts are indeed complicated, but the risks associated with consumers putting up their family home as collateral for consumer spending merit the attention of regulators and consumer protection provisions are warranted. Questions surrounding mortgage-backed credit are being discussed in the forum group on mortgage credit which is due to present a preliminary report in June 2004.
The Commission will also take account of the discussions of this group in formulating its revised proposal. In this respect I also wish to note that the Commission is ready to accept the ceiling proposed. Credits for amounts above this ceiling would fall outside the scope of the directive. Typically, credits for such amounts typically are secured by a mortgage. Concerns have been expressed about the fact that the Commission's proposed regime on joint and several liability will lead to a significant reduction of protection in a number of Member States. The Commission confirms that this is not the intention and believes the directive should not undermine the relevant national regimes.
Regarding the Directive on Unfair Commercial Practices, I am pleased to say that the Commission can accept many of the amendments proposed in Mrs Ghilardotti's report, subject to minor changes in some cases. I will therefore focus on the areas where the main difficulties arise. Under the proposal any practice which is misleading or aggressive automatically meets the criteria for unfair practice under the general prohibition. The Commission cannot therefore accept Amendment No 32 because this would require the tests of the general prohibition to be reapplied to misleading or aggressive practices. This would reduce legal certainty. Amendment No 58 is also not acceptable because it will break the connection between the Article on aggressive practices and the tests in the general prohibition.
The Commission is prepared to adjust the specification of the benchmark consumer which would be used to assess the impact of commercial practices.
Following our consultation we have taken a measured approach to the disclosure of information. The proposal focuses on the essential information which, if not given to consumers, or apparent from the context, is likely to mislead. While some of the proposed adjustments are acceptable, others would upset this balance either by removing key information or by adding extra requirements which would impose costs without bringing any real benefits to consumers. Amendments Nos 46 and 49 to 57 are therefore not acceptable.
The measures in the Annex have been selected because they are not in all circumstances unfair and so can be prohibited up front. But they are arrived at by applying the tests of the general clause and must fall within the scope of the proposal.
I am also against the idea of a double legal base which some people have proposed. I know that some speakers hope for the inclusion of Article 153. However Article 153(1), makes a cross-reference to Article 95, which is the legal base for this piece of legislation, and Article 153(4) refers to legislation which can only be used in areas where you have minimum harmonisation. That is not our ambition. I therefore urge Parliament to follow the draft and to follow the advice of Parliament's Legal Service which, I understand, is of the same view as me.
In conclusion, I only referred to a number of specific amendments or themes. A full listing of the Commission's position on each of the amendments on the three reports discussed in this joint debate is being made available to Parliament's secretariat and I trust this will be included in the verbatim report of proceedings for the joint debate.(1) 
President.
   Thank you very much, Commissioner.
The joint debate is closed.
The vote will take place tomorrow at 12 noon. 

President.
   The next item is the debate on the report (A5-0260/2004) by Mr Robert William Sturdy, on behalf of the Committee on the Environment, Public Health and Consumer Policy, on the proposal for a regulation of the European Parliament and of the Council on maximum residue levels of pesticides in products of plant and animal origin (COM(2003) 117 – C5-0108/2003 – 2003/0052(COD)). 
Byrne,
   . Mr President,I am very happy to have the opportunity to discuss this proposal with you and I would like to thank the rapporteurs – Mrs Redondo Jiménez in the Committee on Agriculture and Rural Development and Mr Sturdy in the Committee on the Environment, Public Health and Consumer Policy – for the time and effort they have put into forging agreements on the text.
This proposal concerns the setting of MRLs: maximum residue levels for pesticides in food and feed. It is a delicate subject, since I do not know of anybody who actively wishes to have pesticides residues in their food. However, in modern agriculture they are an unavoidable by-product of agricultural production methods. Our duty here is to set out a legal and administrative framework whereby consumers are protected from unacceptable levels of residues whilst at the same time permitting trade in agricultural commodities.
It is important to note that this legislation is not designed to regulate the use of pesticides and I do not wish to enter into discussions on the broader subject of pesticide use here today. That is covered by Council Directive 91/414/EEC on the marketing and use of pesticides, on which the Commission will be bringing forward amendment proposals at the end of this year. Let us look, rather, at the proposal before us. This proposal has several objectives.
First, it aims to simplify. It went through a SLIM exercise with stakeholders in 2000 and 2001, and it consolidates and replaces four existing directives and replaces them with a single regulation.
Second, it aims to achieve, at a stroke, harmonisation of MRLs across the Community. We have been setting MRLs at Community level since 1976, and have still not even reached the halfway stage. This means that for most substances and commodities, 15 and soon 25 different national sets of rules apply. This is hardly compatible with the single market. By introducing the possibility of temporary Community MRLs, we can harmonise everything in a short time, pending the outcomes of evaluations of active substances under Directive 91/414/EEC.
Third, we will introduce a role for the European Food Safety Authority in the risk assessment of MRLs.
Fourth, we will introduce clear and transparent procedures for all interested parties in the setting or modification of MRLs.
Fifth, by introducing the concept of a default 'zero tolerance' MRL, we propose a solution for residues of the 400 substances we have already taken off the market, of which we do not want to see any residues in food. Some of these are unacceptable substances; many are substances which industry did not want to support in the 91/414/EEC evaluation programme and for which we have no information one way or the other.
Finally, we aim to strengthen provisions on monitoring and control measures.
These are the main objectives covered by the proposal, which I hope can enter into force by 2006, 30 years after our first efforts in this area, during which we have seen major changes in science, in trade, in politics and in consumer protection. I commend this proposal to you as a major advance in consumer protection and I look forward to the forthcoming discussion. 
Sturdy (PPE-DE ),
   . Mr President, the Commissioner has beaten me to it and said virtually everything I had planned to say. He and I are very much in agreement on this matter.
Before I start, I wish to add to what the Commissioner said about the Food Safety Authority, which is of fundamental importance. It is a plea to this Parliament and to the Commission and everyone concerned that there should be sufficient funding to ensure that the Food Safety Authority can do its job. The committee felt very strongly about that.
I fully welcome the proposals on harmonisation of maximum residue levels in foodstuffs throughout the European Union. For too long there have been variations from country to country. As the Commissioner said, it is very important that a product consumed in one country should be just as safe in another country. It is to this end that I have worked closely with the Commission and the Council.
I would also like to add my thanks to Mr El Khadraoui, the Socialist shadow rapporteur, because we managed to table a number of compromise amendments which, with his help and help from other Groups, have alleviated some of the problems, because there were a number of disagreements. As I said, my aim was to produce something that would not only lead to safety, but would also be workable and sets workable standards. As the Commissioner said, I have taken a lot from Directive 91/414/EEC, which covers plant protection products, and I wish to add to that. I am sure that the committee will – as far as possible, as we resubmit amendments – feel that they are important for the functioning of this legislation. I said that we are resubmitting some: we are not resubmitting all the amendments that failed in the Committee on the Environment, Public Health and Consumer Policy, because it was rather pointless.
I will now go through the amendments we are resubmitting so that colleagues will understand why we are resubmitting them. Amendments Nos 74 to 78, which deal with temporary MRLs, bring the legislation more into line with Directive 91/414/EEC. I feel certain that we have managed to do this in a way that does not compromise public health, because public health is the precise aim of this piece of legislation. Amendment No 74 explains why temporary MRLs are needed. Producers have four years from inclusion of full product dossiers for re-registration. Amendment No 77 deals with the practicalities; the four-year procedure will be used only when Member States request it, and then it will depend upon them showing the necessary research on the product. This amendment fell by three votes in committee, but, if Parliament were to adopt it, it would really add something to the legislation.
Regarding amendments resubmitted by colleagues, Amendment No 67, concerning the setting of MRLs, covers vulnerable groups. We are all aware that vulnerable groups need protecting, but again existing legislation covers that and therefore there is little point in agreeing on that amendment, even though I am sure my colleagues will disagree with that. At no time would Parliament ever take out legislation that supported that.
Amendment No 69 concerns integrated pest management. There is no such thing as a set of standards on integrated pest management. There are, however, different types of farming, and therefore it would be misleading to say that it favours non-chemical methods, because agriculture is agriculture. No farmer – and I speak as a farmer – wants to use chemicals unnecessarily.
I would add one last point that is of particular importance. One of the amendments tabled by Mr Lannoye concerns import tolerances. This is of particular importance because my brain tells me that we should not accept this amendment. My farmer's heart, however, tells me that we should, because it is a legal way of stopping imports into the European Union. I shall use my common sense and recommend that we vote against Mr Lannoye's amendment.
My final point is addressed to the Commissioner: for those who have food, there are many problems; for those who do not, there is only one. 
El Khadraoui (PSE ).
    Mr President, first of all, I should like to thank Mr Sturdy for the good cooperation, which has enabled us to reach important compromises on a number of crucial points. Much as I welcome harmonised, simpler and more uniform legislation in the field of pesticide residues, it would be even better if we could seize the opportunity to increase consumer protection.
Half of our fresh food contains pesticide residues, and there are increasingly more cases of various residues – up to 14 no less – in one product. That is why, when MRLs are laid down, more account is taken of vulnerable groups by introducing additional safety factors and by introducing aggregated parameters for additives or synergetic effects. In this connection, we have asked that MRLs be stipulated on the basis of best agricultural practices, particularly integrated agricultural methods involving the lowest possible dosage and spray frequencies. Not only should MRLs be laid down in a different way, but also more and better residue research should be carried out. Financial penalties when MRLs are exceeded should make their enforcement more effective.
Finally, I think that consumers are entitled to information about ingredients, and so they are entitled to know to how many pesticide residues they are exposed. Measures of this kind contribute to healthier food of a higher quality for everyone. 
McKenna (Verts/ALE ).
    Mr President, I should also like to congratulate Mr Sturdy on his report. We have made a good few improvements: we have stronger rules for residue and we have better definitions of good agricultural practices. It was interesting to hear what the Commission said in relation to modern agriculture that these residues are an unavoidable factor. However, looking at what has been proposed, we are saying that priority should be given to non-chemical crop management, which everybody should welcome.
With regard to aggregate MRLs, if, for example, there are two or three different pesticides, but they are all below the MRLs, the combination should say that they should not be on the market. That is the same logic that we have been pushing for years in relation to drinking water. We are glad to see that this has now been accepted. There are lots of pesticides, but no proper analysis is available. If there is no valid lab analysis and no detection methods available then the pesticides have to be taken off the market. Authorisation must be withdrawn on these. If new scientific evidence reveals a risk, the same should apply.
Some of the amendments we tabled in committee asked for zero tolerance for imported products. These were rejected as the majority thought it was necessary to give specific MRLs for imported products that are not grown in the EU, such as tropical fruits. We have tabled this amendment again. I say to Mr Sturdy that the purpose of this amendment from Mr Lannoye is not about stopping imports but about protecting consumers.
With regard to the amendment asking for temporary MRLs to be set at the lowest level of those suggested, it was not voted on in committee because it was supposed to be included in the compromise. We have tabled some amendments again. We hope we can get support for them because they would improve the overall end result. 
Corbey (PSE ).
    Mr President, first of all, I should like to express my appreciation for Mr Sturdy, for his work and for his willingness to compromise. Permitted residue levels for crop protection products differ to a considerable degree from one Member State to another, and that is why it is a good idea to lay down maximum residue levels.
To us, however, the amendments to the text are essential indeed. The Commission proposal focuses far too little on the protection of consumers and far too much on that of agricultural interests. I should like to bring three things to your particular attention.
First of all, maximum values for residues must be kept as low as possible. Public health and best agricultural practices should be normative in this respect. I should like to say right now, Commissioner, that non-chemical control should take precedence over chemical control. 
Secondly, children are particularly vulnerable because their livers are not yet fully developed. Research in the Emma Children’s Hospital in Amsterdam has shown that certain residues can seriously hamper children’s development. It is therefore of the utmost importance for children to be adequately protected, and so I would ask you all to support Amendment No 67.
Thirdly, clear and strict regulations would eliminate the current distortions of competition when crop protection products are allowed to be used. That would be a welcome development. 
Byrne,
   . Mr President, thank you for the broad support on the Commission proposal in this important area. May I express my thanks once again to Mr Sturdy, the rapporteur, and the shadow rapporteurs for their efforts in bringing this to a conclusion. I am heartened that we share a common understanding of the objectives to be achieved by this proposal: simplification, consumer protection and the achievement of the single market through harmonisation. I would also note that Parliament's deliberations and discussions echo many of the themes and issues raised in the Council discussions. As far as the Council is concerned, I understand that a political agreement will be sought next week and a common position before the summer break.
Given the consistency in views between Parliament and the Council – views shared by the Commission – I am confident that we can now move forward rapidly towards early adoption of this proposal.
We have made good progress in setting out the legal and administrative framework whereby consumers will be protected from unacceptable levels of residues whilst at the same time ensuring that there is a single market by permitting trade in agricultural commodities. There are seven specific topics that arose in the discussions on which I would like to focus.
The first of these is the notion of a default limit-of-determination MRL. This is very important. By accepting the concept of a default 'zero tolerance' MRL, we have found a solution for residues of the 400 substances we took off the market in 2003 for which the remaining residues should have moved out of the food chain by 2005. This means that, if we do not set a specific Community MRL, we do not expect to see any residues. This should help to avoid nasty surprises in future and give us a legal tool to help fight misuse of pesticides.
The application of a default MRL, however, raises a problem – what to do with all the national MRLs that we already have and that are not yet harmonised. Here we are introducing the concept of temporary MRLs. I recognise that the issue of temporary MRLs raises some anxieties, but can assure you that the European Food Safety Authority will be involved in this process. It does not mean that we are suddenly increasing consumer exposure to residues. On a positive note, the setting of temporary MRLs will finally achieve harmonisation and will centralise the MRL process, ensuring that high standards are established and maintained in future.
Also on the positive side, our proposal aims to screen these temporary MRLs and to remove those that are clearly unacceptable whilst permitting the existing situation to continue, pending the detailed evaluations undertaken under Directive 91/414/EEC. Please remember that we are not changing any agricultural practices here. Whatever residues that have been circulating over the past ten or twenty years will still be circulating tomorrow at the same or at lower levels, but not at higher levels.
In relation to agricultural practices, I recognise the desire that there should be a preference for non-chemical methods of agricultural production over chemical methods. However, this is not the appropriate text to regulate that issue. Directive 91/414/EEC on the marketing and use of pesticides governs agricultural production and I intend to bring forward proposals to amend it later this year. These proposals will be submitted as part of a package together with our proposals on the sustainable use of pesticides. I am sure that there will be ample opportunity at that stage to discuss the broader issue of chemical and non-chemical methods.
It is also important to recognise the new role of the European Food Safety Authority. I am sure that this will improve consumer protection and the scientific basis underpinning decisions taken. I know what Mr Sturdy said about the support, financial and otherwise, for the European Food Safety Authority. The Authority should also have an important role in risk communication and provide a reasoned voice in relation to the acceptability of any risks involved. Not only will consumers be protected; they will be seen to be protected.
EFSA will also be deeply involved in scientific issues. Immunotoxicity, endocrine disruption, cumulative risk assessments: these are emerging issues where the regulatory science is still trying to catch up with the latest advances in research. We will be looking to the Authority to help us make progress in this sphere, not just in the context of setting MRLs but also in the scientific data that we will be requiring in the dossiers that industry should be submitting to us under Directive 91/414/EEC.
I have already referred to the setting of temporary MRLs as leading finally to the achievement of the single market in this area. However, let us not forget the global aspect. The Community is one of the biggest importers of food in the world. Consequently we also import a lot of residues. This proposal will set up for the first time a clear procedure for import tolerances, for assessing those residues and for ensuring that only those that are deemed acceptable will be allowed. This is an important obligation in relation to the WTO: any decisions taken on the acceptability or otherwise of imports will be based on clear procedures and a sound scientific risk assessment.
Finally, the strengthened provisions on monitoring and control measures should boost confidence among all parties and ensure that we have the tools available to justify and to maintain that confidence.
A full listing of the Commission’s position on each of the amendments is being provided to Parliament. I trust that this will be included in the verbatim report of proceedings for this sitting.(1) 
President.
   Thank you very much, Commissioner.
The debate is closed.
The vote will take place tomorrow at 12 noon. 


President.
   – The next item is the report (Α5-0253/2004) by Mrs Ghilardotti, on behalf of the Committee on Legal Affairs and the Internal Market, on the Commission communication to the Council and the European Parliament: Modernising company law and enhancing corporate governance in the European Union – a plan to move forward (CΟΜ(2003) 284 – C5-0378/2003 – 2003/2150(ΙΝΙ)). 
Ghilardotti (PSE ),
   . – Mr President, Commissioner Bolkestein, ladies and gentlemen, the European Commission presented the communication on modernising company law and enhancing corporate governance in the European Union to theCouncil and the European Parliament. This communication responds to the report of 4 November 2002 of the High Level Group of Company Law Experts, which Commissioner Bolkestein appointed for the purpose of, precisely, recommending a modern regulatory framework for company law in Europe.
The communication sets out the major political objectives that should guide all our future initiatives. It includes an action plan which lays down a timescale for a series of instruments, regulatory or otherwise, intended to be set up in the short, medium and long term, together with a grid indicating the priority of the measures themselves. In this proposal, the Commission has taken into account the need to respect the principles of subsidiarity and proportionality, basing its own regulatory approach on gradual application, without however, losing sight of regulatory developments at international level.
There are two fundamental objectives sought by the Commission by reforming company law in Europe: strengthening shareholders’ rights and third parties’ protection; fostering efficiency and competitiveness of businesses.
The main grounds underlying this initiative can be distinguished as the establishment of a more homogenous reference framework for company law in order to facilitate cross-border establishment and restructuring; the creation of conditions to prevent a repetition of recent corporate scandals – among which the scandal in my country stands out owing to its size – the consequences of which have severely affected millions of people’s livelihoods, pensions, jobs, savings and investments; making the most of the advantages offered by the internal market.
In order to realise the first objective proposed by the action plan, it is essential to provide an effective, up-to-date system to protect shareholders and their rights. We must also take into due consideration the position of certain third parties, who are particularly qualified in terms of their interests: creditors and workers. From this point of view, the Commission’s approach to the issue of governance seems simplistic and inadequate. Corporate governance is presented as a problem confined solely to relations between shareholders and management, as if a business were a body solely concerned with shareholders’ interests. In this way it is describing a virtual company, without giving due importance to workers and without more general responsibilities towards other categories of parties with an interest in the life of the company itself such as, for example, creditors and other stakeholders.
With regard to the second objective, competitiveness of businesses may be fostered by various elements, including the inevitable existence of an appropriate regulatory framework for company law, firmly balanced between national and Community measures. I believe that the challenge that we must meet today is to aim to bring out the distinctive, characteristic features of European capitalism in the age of globalisation. In other words, we need to ascertain whether there is a true European model, which differs significantly from the North American model, not because it corresponds with and emerges from a framework of challenges and issues other than those which concern everyone in a context of economic globalisation, but because it considers social consequences and implications, making it more balanced and more human: a model, therefore, which seeks to conceive of the essential core of the corporate model, represented by a company’s interests, not just as the common interest of members and shareholders but as the interest of the company itself, a company which, as an independent economic operator, is also responsible for the specific interests of all parties outside and within the company itself. These include employees, customers, suppliers, creditors, the public administration, in its capacity as distributor of welfare and tax revenue, and the entire civil society, which is structurally connected, by means of the general and common interest, to the company’s prosperity and continuity.
One final comment of a general nature: we need to obtain the correct balance between self-regulation and legislative regulation when the European governance framework is formulated. Today there is a widespread tendency to fill regulatory gaps with self-regulation codes. This is positive but it does not go far enough. We need to maintain a system of legally binding rules, equipped with effective sanctions, applied by public bodies entrusted with the tasks of guidance and monitoring. The aim must be precisely to globalise governance rules and to place the public supervisory authorities into a network.
On this basis, we have focused our attention on certain key points, which I will just mention: transparency and shareholders’ rights, role of institutional investors, promotion of the role of independent directors, the specific issue of corporate pyramids, rights of workers as particularly qualified creditors of the company and the centrality of a system of public oversight of audits. 
Bolkestein,
   C. Mr President, the Commission very much welcomes this debate on company law and corporate governance and the action plan connected therewith – an action plan adopted by the Commission almost one year ago. We broadly support the content of the resolution which has been submitted to Parliament. We very much thank Mrs Ghilardotti for the quality of her report.
This action plan is based on the firm belief that a self-regulatory market approach, based solely on non-binding recommendations, is clearly not always sufficient to guarantee the adoption of sound corporate governance practices. Only if there a number of tailored rules will markets play their disciplining role and ensure diligent business conduct. This is why, in view of the growing integration of European capital markets, a common approach should be adopted at EU level, laying down a few essential rules and adequate coordination of corporate governance codes.
Recent scandals have therefore strengthened the Commission's determination to implement its action plan. My services are actively working in five areas to have proposals ready, where possible, later this year. The five areas are as follows: first, the role of non-executive directors; second, the remuneration of directors; third, the responsibility of directors for company accounts; fourth, the full disclosure of intra-group relations and transactions with related parties, including transparency in the company accounts of offshore special purpose vehicles; and fifth, the disclosure of corporate governance practices.
The aim is therefore not to re-examine or reconsider the action plan in the light of recent developments, as requested in the motion for resolution; rather, it is to learn from those developments and to take due account of them when preparing the various initiatives that it contains.
When implementing the action plan, the Commission will also take due account of the interests of the various stakeholders – to which Mrs Ghilardotti made reference – and, where appropriate, distinguish between listed and non-listed companies and large and small shareholders, as is also requested in the motion for resolution.
It is of the utmost importance that we restore trust and confidence in the audit function. I am therefore pleased to see that the rapporteur agrees with the main elements of the reform which I have set out in the proposal for an eighth directive on statutory audit. That should allow us to proceed quickly and, I hope, reach an agreement between the Council and Parliament in a single reading.
I know that the issue of non-audit services delivered to the audited entity is particularly delicate. The Commission has published a recommendation on auditor independence which sets out the conditions under which such services are still allowed. We need to see how this recommendation is applied in practice. Many Member States are in the process of transposing this recommendation into their national law.
It would therefore not be appropriate, at this stage, to fundamentally change our approach in that area. However, in our communication of May 2003, we announced our intention to carry out a study that will examine whether further changes in that area are needed. The results of the study will be available next year. At that time, we shall decide whether new initiatives are necessary.
In Europe, investors need to be better organised and more vocal advocates of corporate change. However, a sound corporate governance framework will not be achieved by the markets simply acting on their own, nor by the introduction of an overly prescriptive legal infrastructure. The challenge we are all facing here is to find the right balance between regulatory and market-based incentives and penalties. We therefore support the broad thrust of this resolution and we are working resolutely along those lines. 
Berès (PSE ),
   .  Mr President, Commissioner, I should first of all like to thank our rapporteur, because I believe that we have here a good proposal for the position of Parliament. I admit that we are only at the communication stage at present. This is a start, but the hard part will come later. Perhaps people’s positions will harden then. However, this is a good starting position, and gives us the green light for our negotiations on this subject.
I agree with you, Commissioner, when you say that self-regulation has demonstrated its limitations. Self-regulation is not enough to define the new balance that is necessary in order to organise countervailing power within the undertaking, because it cannot be the shareholders themselves who organise that countervailing power. In order to organise real countervailing power, you need to take all the partners into account. That is the thinking behind the position which our rapporteur is proposing to Parliament and which the Committee on Economic and Monetary Affairs will support with great determination.
It seems to me that the only difficulty here is first of all ensuring that there is a willingness to organise countervailing power by achieving a balance between the various partners, but there also has to be a willingness to preserve what could be a corporate model which corresponds to the balance that has been achieved as a result of our European experience, without necessarily copying other models.
Finally, we are moving forward here, on legislation which will be very complicated to implement, at a time when these same issues are under discussion in every Member State. That, I believe, is the real difficulty on which you or your successor will have to take a decision. How can we make our rates of progress coincide, so that what is decided in Brussels is not immediately rendered obsolete by what the Member States themselves have implemented in the context of their national legislation? 
Arvidsson (PPE-DE ),
   .  Mr President, the opinion given by the Committee on Industry emphasises the need for the principles of corporate governance to be dynamic and flexible. The subsidiarity principle should be followed in order to leave scope for distinctive national features and traditions in the area, and we must avoid central corporate governance as far as possible. We must not strive for harmonisation of different codes of corporate governance. The share of voting power for different types of share is another example of what should not be decided at EU level, as this would cause problems for small- and medium-sized enterprises, or future companies, in some EU countries.
Instead, what European industry needs is even greater openness and transparency in governance and accounting. This will improve the future flow of capital and market position. I note that some of the rapporteur’s views conflict with the committee’s opinion, but I wish to point out that there was a broad consensus on the adoption of the opinion and that it accords well with the Commission communication. 
Koukiadis (PSE ),
   . Mr President, successful corporate governance is bound up with a reduction in security in cross-border investments and an increase in the mobility of capital.
For the Europe of the 25 members, this imposes the need for us to impart an overall identity to business through which its international influence will be exerted. This identity for Europe cannot be divorced from practices which are sensitive to social and environmental issues. That is why I particularly regret that my fellow members in the Group of the European People's Party (Christian Democrats) and European Democrats rejected my proposed amendment to the Committee on Legal Affairs and the Internal Market, in which I submitted that all directives on company law should include an obligation to inform and consult with the workers' representatives whenever important decisions are to be taken which affect the continuing existence of companies and jobs.
It is a pity that, whenever we try to join forces with the productive system and employment interests, there is a rallying against such proposals, as if they represented a mortal danger.
Similarly, as far as protecting shareholders is concerned, I think that, without doubt, the protection of their rights should be strengthened. However, and I am pleased that the Commissioner admitted this, we must in all cases accept the distinction between large and small shareholders, especially with regard to the use of modern technology in the exercise of shareholders' voting rights, given that small shareholders are more exposed to risk. I am delighted that the Committee on Legal Affairs and the Internal Market accepted the amendment in question.
Finally, for the same reasons, special care must be taken to address methods which result in shareholders' being cheated out of their votes, as happens with arrangements which allow for the informal organisation of systems for the representation of shareholders by large anonymous groups.
To close, I should like to thank the rapporteur, whose basic positions I agree with. 
Lehne (PPE-DE ).
   – Mr President, ladies and gentlemen, I would like to begin by thanking Mrs Ghilardotti for her excellent work in committee in writing this report. At the same time, I would like to thank Mr Winter’s committee and the European Commission for this most excellent action plan. It is a very moderate and purposeful document, which quite deliberately does not try to do too much. I do not think we need any European corporate governance codes, it is quite sufficient if activities are sensibly coordinated and harmonised in the Member States. It is obvious that our systems of company law differ greatly and that harmonisation has not progressed very far as yet. A number of very important directives, like the fifth, have been filed away by the Council and never seen the light of day again.
Against this background, it is of course right not to want to go ahead with a European corporate governance code, because it will not work without a common, harmonised system of company law. That is why I believe, and the Ghilardotti report confirms it, that the Commission has presented a very good paper here and a good action plan over all. There were of course some differences of opinion between the political groups in the internal debate in the Committee on Legal Affairs and the Internal Market. I want to make clear, however, that these were not differences of principle, but differences over how things are formulated and the amount of detail gone into.
For example, Mrs Ghilardotti made a number of proposals, in particular for including trade union staff and social rights in the report. My group took the view that we should not do so in detail, because this is a paper about the company law action plan and not a social report or a social paper. That is why, in our group, we quite deliberately confined ourselves to a general statement on the social reasons for restricting property rights, and we believe that is sufficient and that there is no need for other social aspects to be mentioned in this report.
In all other respects, we believe this is a good report. With one amendment, we as a group will be voting for this report as it emerged from the Committee on Legal Affairs and the Internal Market. 
Inglewood (PPE-DE ).
    Mr President, I should explain that I am the non-executive chairman of a medium-sized regional media group in the United Kingdom.
I will start by briefly stating what I think corporate governance will not do. It will not necessarily make companies perform better or more profitably, and it will not necessarily cut out criminal or unethical behaviour, but it will set down a series of criteria for corporate behaviour that are likely to enhance transparency, accountability and systems of business conduct, which in turn give the wider world, shareholders, stakeholders and others an idea of what is going on. That is politically essential for 20th century European capitalism, set in a social market economy.
It is interesting how company law in the various Member States has created companies that differ qualitatively from one other. European company law can either legislate to harmonise this, or do nothing and let the inevitable process of convergence be driven by the market, providing no particular model is discriminated against. I would add that I am conscious of some of the waspish remarks made about what happens in my country. Against this background, the principle of 'comply or explain' is the right point to start from.
Finally, we must not forget that in the global marketplace currently being created by the World Trade Organization, uncompetitiveness is a certain precursor of economic failure. If we fail to grasp this essential point we shall destroy ourselves, disinherit our children and betray Europe and our own countries. 
Bolkestein,
   . Mr President, there is just one point I should like to stress at the end of this debate: the matter of stakeholders and corporate social responsibility.
The Commission's action plan is part of an overall strategy to foster the efficiency and competitiveness of businesses and to strengthen shareholders' rights and the protection of third parties. However, there are also related initiatives which are part of that overall strategy. They include the Commission's activities on corporate social responsibility and in particular the work of the European Multi-stakeholder Forum, set up at the initiative of my former colleague, Mrs Diamantopoulou. It would therefore have been inappropriate to introduce under this action plan another policy framework concerning corporate social responsibility.
What matters more is to do what Mrs Berès has asked the Commission to do, which is to take due and full account of the interests of all stakeholders in the measures the Commission will adopt. The action plan clearly recognises this need and the Commission is therefore committed to acting accordingly. 
President.
   – The debate is closed.
The vote will take place tomorrow at 12 noon. 
President.
   – The next item is the report (Α5-0192/2004) by Mr Radwan, on behalf of the Committee on Economic and Monetary Affairs, on a legal framework for a single payment area (2003/2101(ΙΝΙ)). 
Radwan (PPE-DE ),
   Mr President, Commissioner Bolkestein, the European Parliament and the Committee on Economic and Monetary Affairs fully support the aim of creating a single payment area in the European Union. There continue to be very significant national barriers in the form of different national regulations, national legislation and national supervision; even today, these make it difficult to create a single internal market for bulk payments, which would ultimately benefit the citizen. We took the first steps in this direction some time ago with cross-border transfer fees. That, too, required an initiative at European level.
We also support, for example, the introduction of a single direct debit system, which has not so far been possible. Imagine, it is now possible for a citizen to travel to another state, but he still cannot have payments debited at home, but he has to choose a national bank to do it.
The question is, how do we achieve this objective? I am a strong advocate of the approach of incremental legislation in line with the principle of subsidiarity, with self-regulation in first place, that is self-regulation by the banks. We have the European Payments Council – which can, should, and indeed must set the parameters for the creation of the technical interfaces for cross-border activity, for example.
Then, also with subsidiarity in mind, I would prefer the next steps to be taken in directives and only enact in regulations what is really necessary to do uniformly. I would also like to sound a warning to the industry here, since it is itself always talking about self-regulation: these requirements will also have to be complied with and corresponding standards created without undue delay.
Consumer protection presents a greater problem in this Commission document. It contains some ideas which in my view go far beyond our objective, and I have the impression that there are some people in the Commission – let me make clear that I do not mean you, Commissioner Bolkestein – who have lost sight of the idea of citizens taking responsibility for themselves. They suggest that the bank should in future be liable for a basic transaction. For example, if customers buy something over the Internet and the purchase is void, they want their money back, and if they cannot turn to the supplier, they should be able to turn to the bank, which had nothing to do with the basic transaction. I am sure things like that can be settled by the market – and you are an advocate of the market, after all – by having products that provide safeguards; a fundamental liability of the banks in such cases should be rejected, however, as should the proposal that cardholder’s liability be limited to EUR 150 when the card is lost, regardless of how they have behaved. If they go away on holiday, discover on setting out that they have lost their card, and report it three weeks later, the cardholder’s liability will still be limited to EUR 150. I think we should give a little more protection to people who act responsibly than to those who act irresponsibly.
I am, however, pleased to welcome the fact that the Commission has taken up the idea of establishing a single EU-wide telephone number that can be called if a card is lost – a short number that is easy to remember and that the citizens can dial quickly.
I would also like to stress that the creation of a single payment area should not result in national structures that are working well and efficiently being made less economic. We must not go about it in a way that is detrimental to operational national systems. Coming back to consumer protection, however, may I appeal to you, Mr Bolkestein, in the ongoing discussions within the Commission, to speak up for mature and responsible citizens and see that responsibility is left with them. The Lisbon objectives of becoming the most innovative and fastest-growing region in the world are held up to us repeatedly. Everyone is brandishing the slogan ‘less bureaucracy’. Mr Bolkestein, the text we have before us should be judged by whether it creates more bureaucracy or makes life easier for banks and citizens in the single European Union. 

Bolkestein,
   . Mr President, this is the third time that I have come to a plenary session to address the issue of payments. An efficient and secure payment system is an essential complement to the free movement of goods and services in the European Union. Let me give you one figure to illustrate this. Every EU citizen carries out, on average, 138 non-cash payment transactions each year. An efficient system must be based on a robust and dynamic regulatory framework that ensures competition, consumer protection and safety in payment transactions. Pan-European trade needs an effective underlying payment system if it is to expand.
The regulation on cross-border payments adopted in 2001 has made it easier and cheaper to perform many types of payments in euro within the internal market. However, we are not yet where we want to be and need to be. Significant obstacles remain, as are highlighted in our communication. To deliver an improved regulatory environment for payments, remaining legal and technical barriers to intra-EU payments should be identified and removed. In other words, the whole internal market ought to be transformed into one efficient domestic payment area. That is our main purpose.
EU legislation in this field is necessary. But for certain issues, self- or co-regulation could be the best approach. That also satisfies Mr Radwan's desire for more subsidiarity. As always, the solution should be proportionate to the problem it is intended to solve.
The four guiding principles for the Commission’s future regulatory proposal should be as follows. Firstly, to modernise the existing EU legislation on payments. Secondly, to inject more competition into this market for the ultimate benefit of our citizens. The basic idea is that the provision of payment services should be open to all appropriate providers, but without sacrificing consumer protection. We must therefore design an appropriate supervisory framework matching all types of payment service providers. The guiding principle here must be: 'same business, same risks, same rules'.
Thirdly, we need to develop a trustworthy pan-European payment area in which consumers feel that they have the same protection, no matter where they are and what kind of payment instrument they use. A single and balanced set of rules should be defined on parties' rights and obligations regarding, for example, misuse of a payment instrument and revocability of payment orders.
Fourthly, we need to incorporate the relevant Financial Action Task Force, or FATF, special recommendations into EU legislation to combat the financing of criminal activities.
Let me stress that given their decisive contribution to the competitiveness of our economy, payments are high on the Commission’s agenda. We shall need the strong support of this Parliament, and in this respect I am encouraged by the terms of the resolution which has been put forward by Mr Radwan. I welcome all amendments submitted by Members of this House.
I shall wind up by thanking Mr Radwan for the report which he has submitted and I assure him that, just as he wishes to have less bureaucracy, that is precisely what this Commissioner and the Commission as a whole also want. 
Torres Marques (PSE ).
    Mr President, Commissioner, ladies and gentlemen, in the previous legislature, the Euro was established as scriptural (non-cash) money. It has now, in the current legislature, become the currency of twelve countries of the European Union. The creation of the single currency does not, however, automatically mean that there is a single payment area, in which the same rules apply across the board. This is one of the major tasks facing the European Union in the next legislature.
The Commission waited until the last possible moment for the banking system to establish self-regulation following the creation of the single currency. After the Euro’s inception in 1999, however, two markets were established for the purposes of payments – a national market and an international market. There was no internal market governed by domestic rules regulating payments in the new currency, which, although a single currency, functioned as a foreign currency, subject to commission and other foreign exchange charges.
This situation was partially solved by Regulation No 2560 of December 2001 concerning electronic transfers and payments. Since then, self-regulation still does not appear to have worked; the directives have not worked either, as they must be transposed into the law of each country, and this has not been carried out at the same time or in the same manner. This is an area that requires rigorous rules to be applied simultaneously and uniformly throughout the internal market. It is therefore my opinion that only by establishing regulations can we give the citizens and companies the security that a payment system requires. 
Herzog (GUE/NGL ).
    Mr President, it is a pity that the debates on consumer credit and on the single payment area were not combined, because the same issue is at stake in both of them: do we want to construct a European market in retail financial services? Up to now, priority has been given to the wholesale market and to investment services. During this legislative period, the only initiative of any note – though it is an important one – has been the one on the rules for setting rates for cross-border payment transactions within the euro zone.
This debate is, therefore, important and I believe that we must now set a clear political objective. That, I believe, is what the Commission wants. The euro cannot be a complete success unless we construct the euro zone as an internal area for payment methods. In order to do that, it is vital that we should achieve interbanking in the infrastructure. The activity of supplying payment services presupposes, admittedly, the removal of national obstacles, but at the same time it also requires prudential supervision.
It is on that basis that the internal retail banking market, and in particular the consumer credit market, will be able to develop, and that in turn will allow European banking operators to emerge. Of course, within that integrated area it will be necessary to take into account the diversity of the operators involved, and in particular the special nature of savings banks and mutual societies.
What, though, is the best way to proceed? The application of the ‘country of origin’ rule with minimum harmonisation seems to us to be negative, both as regards consumer protection and from the point of view of fair competition. Mr Radwan’s report, which leans in that direction, gives far too much preference to self-regulation. On the other hand, however, maximum harmonisation would leave no room for diversity and would, therefore, also cause a problem.
That is why I believe that the best solution is to agree on the common principles of general interest, the common concepts, particularly with regard to universal access to payment methods with a high level of security, services which are inexpensive but in which there is great confidence. The rules governing cross-border transactions must be precise, and intense cooperation is necessary between national regulators.
With that in mind, there are several points in Mr Radwan’s report which in my opinion require adjustment. Thus in paragraph 17 the rule recommended by the Commission should be reinstated, that is, the rule restricting customers’ liability to EUR 150 in the event of unauthorised transactions where they have not given notification. As for pan-European direct debit, account-holders must be able to refuse a payment before it is debited from their account. If there is a substantial modification in rates, it must be possible to close or move an account, at no cost, at the request of the customer. It is also necessary to re-establish the liability of the payment service providers over the whole of the payment chain.
Finally, it is also necessary to have stronger Community rules to combat the funding of terrorism. The system of complete information must, therefore, also apply to payment transfers outside the Community as well as those within the Community. 
Bolkestein,
   . Mr President, the Commission is grateful for the general support it has received in this debate. I see no further reason why I should ask more time of Parliament than I have already done. 
President. –
   The debate is closed.
The vote will take place tomorrow at 12 noon. 
President. –
   The next item is the joint debate on the following reports:
– A5-0213/2004 by Mr Mombaur, on behalf of the Committee on Industry, External Trade, Research and Energy, on amendment of the legal basis and on the ‘general orientation’ of the Council with a view to adoption of a directive of the European Parliament and of the Council concerning measures to safeguard security of natural gas supply;
– A5-0254/2004 by Mr Seppänen, on behalf of the Committee on Industry, External Trade, Research and Energy, on the proposal for a European Parliament and Council regulation on conditions for access to the gas transmission networks. 
De Palacio,
   .  Mr President, ladies and gentleman, the regulation which is the subject of Mr Seppänen’s report is a most important element of European legislation aimed at completing the task of creating a fully operational competitive European market in natural gas. It is an essential supplementary instrument to the second directive on the internal market in gas. This is because it lays down the minimum requirements for the key aspect of the approach to liberalisation of the energy market, namely access to the networks for third parties.
I am fully aware the draft regulation on conditions of access to gas transmission networks has given rise to a series of interesting debates over the last few weeks. I should therefore like to take advantage of this opportunity to clarify some issues where I believe further explanation is still required.
It is important to reflect firstly on what the draft regulation is designed to achieve, and secondly, on why is it needed and what significance it has?
Clearly, the regulation supplements the directive on the internal market and fills the gap remaining. Indeed, both the second directive on the internal market in gas and the proposed regulation are based on the principles of non-discrimination, transparency and competition. Clearly, both legislative acts recognise the fundamental importance of access to the network by third parties. The directive, however, only defines the objectives, whereas the regulation lays down a series of minimum requirements to be met with regard to the crucial issue of access to the network by third parties. Obviously, a number of conditions will have to be met in order to comply with the provisions and objectives contained in the directive, as there are qualitative implications to opening up the market in addition to quantitative ones. These conditions are also needed to ensure the market is competitive and can be exploited in full.
This discussion concerns drawing on the experience gained during liberalisation of the gas markets. Experience has shown that failure to meet such requirements will mean that conditions of access to the European market will not meet the needs of opening up the market in gas. Competitiveness and smooth operation of the latter will not be ensured either.
All this has been the subject of debate at the Madrid Forum for a year. Essentially, the participants in that forum laid down the requirements. The latter amount to minimum conditions agreed by all those involved in the Madrid Forum. The aim is to create and guarantee a level playing field for access to this market.
To summarise, if this regulation comes into force, in the version proposed by the Commission, there can be every confidence that the means and systems are in place to allow it to become operational. I must remind the House that our common aim is to create an internal market in gas within the European Union. Gas should be able to flow freely across all the networks in the Union. This means gas will be able to cross borders unrestricted. It also means that no restrictions can be placed either on its movement within the various Member States of the Union. This is the reason why it has been stated specifically that all transport networks are covered by the proposed regulation, not simply cross-border networks.
Turning to the role of the gas sector in the years to come, there can be no doubt that close cooperation between the sector and the Commission will be essential. This should be borne in mind when it comes to defining the general standards for the gas market in the future.
For obvious reasons, the Commission proposed the committee procedure. The latter will have no influence in this regard, however. It is not aimed at restricting the role of the sector and certainly not at excluding it from the drafting of future measures. Quite the opposite is the case. The Commission is open to proposals emphasising the role of the sector here and now and in the future.
I should now like to turn to Mr Mombaur’s report. I shall focus on those parts of it concerning measures to ensure the security of natural gas supply.
You will recall that last December, the Council unanimously adopted a political guideline. The Council also amended the legal basis for the Commission’s proposal. Article 100 is now the legal basis instead of Article 95. The European Parliament report we are today debating also supports the change in the legal basis.
The House will be aware that the Commission does not endorse such a change of legal basis. On the occasion of the Council held on 15 December 2003, the Commission issued a statement reserving its position on the change of legal basis. We shall stand by our statement and position when the Council finally adopts the text of the directive in question.
Please allow me to outline the reasons for maintaining our position. I shall be brief.
We appreciate that part of the text of the draft directive refers to the security of supply. The text also contains references to the operation of the internal market, however. The Commission believes that the references to the internal market carry most weight, and that therefore they should determine the legal basis of the directive.
In addition, the Commission is of the opinion that the text adopted by the Council contains a series of standards aimed at bringing a degree of harmonisation to a competitive European internal natural gas market. The Member States are charged with defining a policy to ensure the security of gas supply. It is also for the Member States to define the functions and responsibilities of the participants in the gas market regarding the security of supply. In addition, the Member States are responsible for introducing certain minimum standards. Each country will define its own standards. Nonetheless, a degree of harmonisation will exist, as the standards relate to certain specific criteria for gas.
By contrast, the provisions aimed entirely at security of supply are designed mainly to deal with situations we hope will never arise. I have in mind situations such as a serious political crisis or long-term uncertainty surrounding gas supply.
In the light of all this, the Commission remains convinced that Article 95 is the correct legal basis. The Commission therefore regrets that the Council saw fit to come to a different conclusion, and that it now appears Parliament will do likewise.
Mr President, I should like to conclude by thanking Mr Seppänen and Mr Mombaur for all the work and effort they have put into these two reports. Following on from the various amendments and speeches, I shall say more on a key issue, namely access to the networks. In the Commission’s view, there can be no question of threatening the profitability and future investment in a most crucial element for the development of the market in gas. I refer to the construction and maintenance of gas networks across the Community. This is borne out by the proposal for trans-European energy networks. A number of the main projects for the future already adopted relate to gas networks.
In the context of the first proposal being discussed in the run up to enlargement, the Commission endorses and supports several projects involving major interconnections between gas networks. 
Mombaur (PPE-DE ),
   Mr President, Commissioner de Palacio, ladies and gentlemen, first of all, the proposal for a regulation on access to gas transmission networks. It is important to have reliable rules for access to networks. We found that with the gas directive last year. My group believes the proposal should be further discussed together with the amendments tabled by the Committee on Industry, External Trade, Research and Energy.
Commissioner, there are four points I would like to recommend you consider in greater detail in the Council debate. Firstly, investment incentives. We can talk about markets here for a long time. If we have no investors, then in the end we have no market either. The Commission has often referred to the great risks carried by investors in the gas sector – exploration, pipeline construction. There is competition in pipelines; there already was when the monopolies existed. That is how the market came into being and it must remain clear that tariffs based on costs alone may deter investments.
My second remark is please will you consider whether more weight can be given to cross-border gas transport. Thirdly, comitology. The problem is not comitology itself, but the question is whether Article 9 is in a correct relationship to Articles 3 to 8, that is whether the most important points really are in Articles 3 to 8. This can perhaps be improved when it is discussed in the Council. My fourth comment, Commissioner de Palacio, is that of course everyone who has anything to say about the market is important, regulators, network operators and above all investors, and it is absolutely clear that you talk to them before you make proposals to Parliament and Council; you always have done. Now they would all like to be mentioned in the legislation. Personally, I do not see why they should be, because I believe the Commission knows how to do its job, but if it would give those I have just named pleasure to be mentioned in a recital, then I do not really mind.
Then I would like to say something about the other report on security of natural gas supply. It is correct that we depend very much on imports. It is therefore right that we should be concerned with this and oblige the Member States to introduce a suitable policy. Now Parliament has adopted at first reading a different text than the one the Commission presented and the Council has backed Parliament in the matter. We are therefore now speaking about a different text than the Commission originally presented and in our view this text no longer contains any rules for the internal market. This means that the European Union has only one way of justifying it at all, namely Article 100 of the Treaty, and, on the basis of the vote of the Committee on Legal Affairs and the Internal Market, the committee therefore recommends that Parliament follow the Council’s lead on this. 
Seppänen (GUE/NGL ),
   . Mr President, Commissioner, the Commission has made a draft Regulation on the codecision procedure for Parliament and the Council, the aim of which is to guarantee free access to the gas transmission networks throughout the EU. Some Member States have had problems implementing earlier decisions, and the Commission has therefore used a strategic weapon, which is to say a regulation, to guarantee access to gas networks in all countries, especially when transporting gas across borders from one country to another, but also within countries.
The draft Regulation is mainly based on the work of the Madrid Forum, which was attended by different market participants. They thought they were drafting a recommendation there that would guarantee access to the gas transmission markets on a voluntary basis. Some of those that participated might feel let down, as a voluntary commitment was altered to a compulsory regulation in the Commission’s reading.
There was not enough time at the Madrid Forum to discuss all the details regarding access to the networks, and new laws are to be drafted in the future under the comitology procedure without any consultation procedure involving the participants at the Madrid Forum. It is therefore understandable if some market participants are worried about how their interests are to be taken into account in the future.
During the committee discussions the Commission representatives said it was the Commission’s intention that the participants at the Madrid Forum would also be heard in the future when the detailed regulations for implementing the Regulation were being drafted. As the Madrid Forum is not a legal body, it is the opinion of the Commission that consultations with it cannot be recorded in the text of the Regulation. As rapporteur, however, I think it would be appropriate if this undertaking to consult the various parties were also recorded in the minutes of Parliament’s plenary session. I would expect this to be done when the Commissioner makes her next speech or before the final votes.
After a number of votes on the matter our committee adopted the position that there are good arguments in favour of establishing the Regulation and that the Commission proposal should furthermore be adopted in principle by this Parliament. In the votes more than 40 amendments were accepted as a basis for first reading, and Parliament wishes to hold talks on them with representatives of the Commission and the Council some time in the future when the draft Regulation is being finally agreed. I wish to thank everyone for their excellent levels of cooperation whilst the item for debate was being prepared. Although we were in disagreement with one another and had our different interests to consider, I think we managed to work very objectively and achieve an excellent end result.
I await the Commissioner’s speech, which will hopefully reconfirm the Commission’s commitment to include consultation with the participants of the Madrid Forum in the future. 
Chichester (PPE-DE ).
    Mr President, I would like to start by congratulating the rapporteur on bringing together into his report the different strands of opinion that were expressed in the debate.
It is significant that after much debate in committee only one additional amendment has been tabled over and above those adopted in committee. I am one of those who accepted the argument for the need for a regulation to give effect to and make binding the voluntary code on guidelines for good practice agreed at the Madrid forum, and I and my Group therefore support this proposal for a regulation.
The rapporteur states the case very well in his explanatory statement and I can do no more than commend his analysis to colleagues and make a recommendation to adopt. We must recognise that the industry was not of one view on this matter, with the incumbent network or transmission system operators resisting change, while most of the other operators, be they upstream or downstream, strongly endorsed the underlying principle embodied in the Commission proposal. This measure should assist new entrants.
In order for competition to flourish and for benefits to flow from it in terms of better service to consumers, greater efficiency as regards both energy and market forces, enhanced security of supply, greater flexibility and increased innovation, there must be a clear regulatory framework. This measure takes us a long way towards genuine and full liberalisation and I congratulate the rapporteur and the Commissioner on their efforts in this regard. 

Rapkay (PSE ).
   – Madam President, ladies and gentlemen, I want to begin where Mr Chichester left off, that is that we cannot proceed fast enough with opening the energy markets. I believe we in this Parliament have been united on that for quite some time. May I remind you that last year, after more than two years’ intensive work, we adopted directives to accelerate the opening of both the electricity and the gas markets in Europe.
I must say, however, that I and a few others, too, were then rather surprised at how quickly this follow-up proposal for a regulation concerning gas transmission networks has come. We are surprised because the time allowed for the Member States to implement the directive has not yet expired – it will do so in a few weeks’ time – and also because we have set a very ambitious timetable for the Commission to submit an evaluation report on the application and implementation of the directive; it was to happen in 2006. So much for the background.
I want to raise three points which, I fully admit, have left me rather sceptical. Firstly, the compatibility between this regulation and the directive we adopted. Secondly, the justification the Commission has given, which I have not exactly found in the text, namely that the emphasis should be placed on cross-border trade. The third point that has made me rather sceptical was the proposal for a very wide-ranging comitology procedure.
Now, after a long discussion, as the rapporteur said, we have agreed to continue working on the Commission’s approach. We have therefore proposed a number of amendments in the three areas I have just mentioned. So far as my group is concerned, the outcome is that we support the package as a whole. That is not the end of my group’s work, however. We are waiting to see what the Council does and then there will be the second reading, but we shall continue to back here in plenary these 42 amendments that were adopted in committee, and we hope that this will bring us a little further forwards in the opening of the energy markets. 
Blokland (EDD ).
    Madam President, first of all, I should like to thank Mr Mombaur for his work as rapporteur on this difficult issue. When the legal basis of a proposal is unreliable, when the rights of the Member States are infringed in the process, and where the actual text leaves something to be desired, it is not easy to draft a sound report. It is gratifying to note that the Council has reached a political agreement after all, in which Parliament’s reservations have been duly incorporated.
Last year, during the discussion of the issue of safeguard security of gas supplies, I was the draftsman of the opinion on behalf of the Committee on Economic and Monetary Affairs. I then indicated why the Commission proposal was unsatisfactory on a number of scores. It is satisfying to see that the Council has adopted the most important recommendations to have been made during the debates.
A first recommendation concerned the legal basis of the Commission proposal. The Commission took Article 95 – internal market – as its basis. At the time, we talked about the fact that it would be preferable to use Article 100, which deals with crisis measures. I think the Commission is wrong in its view that Article 100 applies only to economic and monetary policy; in a wider context, economic policy can also include energy policy. You stated, Commissioner, that the Commission fails to see eye to eye with the Council and Parliament. Do you intend to go to the Court of Justice again?
My second recommendation is this. In the Council, Commission and Parliament, the gas directive, in respect of which the Council’s common position was determined, was circulated last year. The proposal concerning security of supply does not appear to be in keeping with this. On the contrary, the proposal seems to contravene the gas directive. It was surprising that pending the procedure with the gas directive, a proposal was submitted to Parliament on safeguarding security of gas supplies. I should like to hear from the Commissioner whether the amended proposal on safeguarding security of gas supplies has been based on the gas directive. If so, in what way was that done? 
Kronberger (NI ).
   – Madam President, you have to consider two things where natural gas is concerned. The first is availability and the second is price. In my opinion, we are right to take Article 100 as the basis now, even if Mr Blokland is right in saying we will have to take a very broad interpretation of it. Whenever security of supply is discussed, there is always the temptation really to mean that it is an opportunity to introduce indirect price controls. I believe that on the whole we will fail in that, because it will not work and the perspective taken is far too short-term.
Basically, we must not forget, either, that gas is dependent on price, which is in turn tied to the price of oil, and that we may perhaps be greatly deceiving ourselves about its availability. The best form of security of supply is surely to have our own supplies, and we must therefore welcome the fact that work is gradually being done (a) to produce high-quality gas ourselves inside the European Union and (b) to feed that gas into our own available networks. 
Adam (PSE ).
    Madam President, after almost 25 years in this Parliament I am standing down at the elections. This may well be my last speech in the Chamber. As a former mining engineer, energy policy has been one of my prime interests, so I am happy to be making my swan-song on an energy subject.
I hope that Parliament will strongly support this proposal because it will play an important role in the completion of the internal energy market. Its purpose is to ensure fair access to networks for all market players and a genuinely competitive market for traded gas in the EU.
The third-party access guidelines in the Annex have been agreed by Member States, regulators, TSOs and system users. It is therefore appropriate that the text of the regulation agreed in committee should be as close as possible to the guidelines agreed at the Madrid Forum. Consultation with all actors in the industry is vital if the regulation is to be effective. That is why they must all be consulted on the establishment of further guidelines. National regulators will have a vital role to play in enforcing the guidelines at Member State level, as envisaged by the Gas Directive.
This proposed gas regulation deals with similar issues to the electricity regulation agreed by the Council and Parliament last year. It is appropriate that the same institutional arrangements and procedures should apply.
I very much urge the House to approve this measure. 
Della Vedova (NI ).
    Madam President, Commissioner De Palacio, Mr Mombaur, Mr Seppänen, last June the European Union adopted, with difficulty and well behind time in relation to consumers’ and European companies’ needs, Directive 2003/55/EC which takes decisive steps towards the completion of the liberalisation of the gas market.
In order to overcome the remaining obstacles to the completion of the internal market, the Member States established a system of informal coordination between, on the one hand, Community and national institutions, and on the other, companies and regulatory authorities in the gas sector, seeking to lay down guidelines on third party access to transmission networks. Nevertheless, this informal coordination has proved to be inadequate to address the severe delays which have built up until now; indeed, the interests in undertakings of various countries and the privileges of position which many gas supply undertakings continue to gain from, have seriously jeopardised the possibility of completing a single market in the gas supply sector.
We should therefore welcome the Commission’s initiative proposing the regulation which we must debate today, which makes the operating rules clearer and binding and responds to consumers’ and companies’ needs for certainty and rapidity. The text put forward by the Committee on Industry, External Trade, Research and Energy further strengthens this proposal and I therefore believe that it should be supported as it stands.
It is in the interest of certain countries – Italy in particular – with a high consumption of natural gas, insufficient national production and a strong, growing dependence on imports, which require several countries to be crossed, to have certain rules which signify, in operational terms, a real opportunity to have a market and, consequently, a system of liberalised networks which make gas available to companies and consumers in the required amounts, with freedom of choice. 
Linkohr (PSE ).
   – Madam President, I would be interested to know how we, or those who come after us, will speak about this problem in ten years’ time, whether we will have become wiser or not. I cannot answer that question today.
One thing is certain: security of supply will be improved by more competition; we have always been clear about that. Even competition cannot do that without supply, however, which means, I believe, that security of supply, of natural gas in particular, will depend very much on a European foreign policy for energy, in other words diversification and security of supply through access to gas.
Like many others, too, I also advocate proceeding gradually. I believe that, as with oil, the responsibility rests in the first instance with the companies. I imagine that in two years’ time there may be a review and we may be rethinking the present situation. I do not believe we are under any pressure of time. 
Paasilinna (PSE ).
   – Madam President, Commissioner, ladies and gentlemen, competition will of course be distorted if, for example, there is access to the electricity market but not to the gas market. And it will be distorted still more if we protect monopolies that then buy smaller companies elsewhere in other countries.
We need common rules and the barriers to competition have to be eliminated, which obviously applies to all Member States. I also support Mr Seppänen’s request that the participants at Madrid should be consulted. I also think that the correct legal basis is indeed Article 95, as stated in the Commission’s proposal. I am astonished at this switch to Article 100, which I consider to be just an extra problem, and I hope we will go back to Article 95. 
De Palacio,
   .  Madam President, I stand by my earlier statement regarding the legal basis. Consequently, I shall focus on the various views expressed and on the amendments to Mr Seppänen’s report.
I should like to begin by thanking the House for the discussion that evolved on a matter of such vital importance, and for the calibre of the 43 amendments. This does not mean that we will be able to endorse all 43, however. In particular, I should like to thank the rapporteur for his excellent work. Thanks are also due to Mr Mombaur, who has already left the House. I do not share his views on changing the legal basis, but he certainly has worked in a most constructive manner also.
I have to say that the Commission cannot support the amendments restricting the scope of the draft regulation to cross-border trade only. That would amount to scaling down the aim of this proposal significantly. The same would be true of its possibilities. There would be no difficulty in trading gas from one country to another, but internal competition would definitely be restricted. In a number of States, including several new Member States, gas flows along many networks. Some of the latter do not link into a specific point of importation. Consequently, they do not link into a cross-border point either.
All these transport networks and the relevant companies would be excluded from the scope of implementation of the proposed regulation. This would hinder and prejudice the smooth operation of the internal market. In addition, the scope of implementation is that envisaged in the transit directive and in the second directive relating to the internal market in gas.
What is at issue is facilitating competition, not only competition between the various countries but also within them. Restricting the scope of implementation of this regulation would entail limiting its aim significantly and also limiting the possibility of actually achieving a competitive European gas market.
It must also be taken into account, however, that several speakers, and in particular Mr Mombaur, have raised the issue of guaranteeing a degree of profitability that would make the allocation of funds to the creation, construction and maintenance of the gas networks an attractive proposition. In this connection, I can say that we are able to accept Amendment No 12. We believe it clarifies our text and improves its quality. We feel the amendment takes account of competition between the various networks. There was no specific provision for this in our text. We are therefore of the opinion that the amendment helps to allay the fears of those concerned about the lack of profitability. Consequently it also allays concerns about future difficulties relating to new investment.
I must point out that the minimum standards for access to transport networks are absolutely crucial. They are essential in order to facilitate access to new competitors, and therefore also to creating a genuine internal market in gas. I cannot emphasise this enough.
The subject of the Madrid Forum has also been raised. It has been suggested that we should move somewhat further ahead. Furthermore, concern has been expressed as to whether, in future, the comitology procedure will result in sidelining the Forum, or sidelining the sector, that is, its protagonists.
The House must be aware that over the years I have always stressed the need to listen to the main stakeholders on a regular basis and we are, therefore, prepared to consider a solution guaranteeing that the sector will be consulted at the Madrid Forum, together with all other interested parties.
Amendment No 3 could prove helpful in this regard. However things eventually turn out, we have no intention of excluding the sector. On the contrary, we hope it will remain involved. Looking to the future, we intend to support the Madrid Forum.
The Commission does not wish to go beyond the ground covered by the Madrid Forum. Nonetheless, we do believe that one of the proposals put to the Forum by Eurogas, relating to the ‘use it or lose it’ principle, is essential in the field of contracts. Otherwise, contracts could result in outright prevention of genuine access to third parties. This would mean restricting competition. Future user contracts must therefore be based also on the ‘use it or lose it’principle. This is the only way of ensuring they are genuine contracts and not contracts aimed solely at using or saturating available capacity. By creating artificial congestion in the networks such contracts would prevent access by third parties.
In general, the draft regulation is in line with the Madrid Forum guidelines, as you have pointed out and recognised, ladies and gentlemen. The amendments that clarify or support the provisions of this draft regulation are acceptable, at least in part or if their text is adjusted. This is true of Amendments Nos 1 and 22, and of many others I shall not mention individually. A detailed list will be provided.
Concerning certain technical issues such as those dealt with in Amendments Nos 14 and 16, these are matters dealt with by the European Association for Gas Exchange. The latter was set up at the request of the Madrid Forum. I have to say that given the very specific, complex and technical nature of these issues, we shall continue to leave them to the aforementioned organisation to deal with. It has already made significant progress, and is reporting regularly to the Madrid Forum. We believe this is the best way to deal with such matters.
There are practical and legal reasons why amendments such as Amendments Nos 8, 17, 22, 27, 30, 35, 37 or 42 are not acceptable. Finally, we cannot agree to the presentation of new guidelines on the remaining issues dealt with in the draft regulation in a predetermined time period. Some of these issues may require studies to be undertaken. Discussions and negotiations on others may take longer than anticipated. Consequently, Amendment No 31 is not acceptable.
Ladies and gentlemen, this is the last debate on fundamental issues concerning energy to take place in this Parliament. There will of course be a debate on Eco-design later. To some extent, however, that is a side issue, bringing together industry and energy. It tends to be always the same people taking part in these debates, and we have come to know each other fairly well. I should like to congratulate Mr Seppänen, the rapporteur, and also to thank all the honourable Members present for their input and support over the years. Their contributions were most welcome and have been incorporated into many of the proposals drafted during this period. I feel Parliament’s constructive attitude and the helpful interchange of ideas have resulted in considerable improvement to most of the proposals brought before the House. Personally, I have valued your help, ladies and gentlemen, and also the Commission’s constant support.
It is worth remembering that, thanks to this constructive attitude, it has been possible to make spectacular progress during these last years. The Commission’s adoption of the Green Paper marked a turning point. Parliament’s report on the Green Paper was of the utmost importance too, as were the conclusions it led to. I could mention the gas and electricity liberalisation packages. There were also the crucial accompanying measures, such as access to the networks. Work on the latter is just drawing to a close. As Mr Linkohr, Mr Rapkay and several other speakers have mentioned, we would have liked to wrap up earlier on this. Nevertheless, our goal is in sight and we are moving slowly but surely towards it.
Along with the liberalisation of gas and electricity, the proposal concerning trans-European networks is essential in order for the European internal market in energy to become a reality as far as infrastructures are concerned. The relevant measures dealing with the current Union have been adopted already. Work on similar arrangements for the enlarged Union is well advanced.
We have worked as never before to debate and promote matters relating to energy and the environment. In the past, in other parliaments, the tendency had been simply to set goals for this key area. Many good intentions were expressed, but there was a lack of specific proposals aimed at attaining the objectives. We have succeeded in translating those pious statements and good intentions into texts, obligations and responsibilities. By way of example, I could mention the promotion of renewable energies, energy efficiency in buildings, issues related to biofuels, the creation of intelligent energy, Eco-design and energy efficiency. Community policy has come into play too. This has been most important. Good progress has been made concerning Community policy on nuclear safety. The work is not yet complete, but much has been achieved. A further issue related to the European energy market on which substantial progress has been made concerns the adoption of a European objective with regard to the security of energy supply. Mr Linkohr referred to this when he took the floor. Furthermore, the importance of ensuring security of internal supply within the Union has been recognised also.
Good progress has been made. We have worked well together. Madam President, I am bound to thank the House once again for its cooperation, for all the effort it has made and for its valuable contributions. In particular, honourable Members are to be commended on the intellectual skills and depth of knowledge they displayed in tackling the texts, which have sometimes been extremely complicated and technical. They demonstrated an excellent grasp of the issues, and I believe congratulations are in order. 
President. –
   Thank you, Commissioner. You were kind enough to say how much you appreciated the excellent collaboration with the European Parliament and especially with the members of the Committee on Industry, External Trade, Research and Energy. I think I can say, on behalf of the members of that committee and on behalf of the European Parliament as a whole, how much we too have appreciated being able to work with you in the field of energy and in other fields. Your feelings, I believe, are reciprocated by the Members of this House.
The debate is closed.
The vote will take place tomorrow at 12 noon. 
President. –
   The next item is the report (A5-0171/2004) by Mrs Thors, on behalf of the Committee on the Environment, Public Health and Consumer Policy, on the proposal for a directive of the European Parliament and of the Council on establishing a framework for the setting of Eco-design requirements for Energy-Using Products and amending Council Directive 92/42/EEC. 
De Palacio,
   .  Madam President, ladies and gentlemen, the draft directive establishing a framework for setting out the environmentally-friendly requirements applicable to energy-using products is somewhat innovative. I should like to thank Mrs Thors and Mr Turmes for their excellent work within their respective committees, the Committee on the Environment, Public Health and Consumer Policy, and the Committee on Industry External Trade, Research and Energy.
The aim is to find the right balance between two elements. On the one hand, there is competitiveness, environmental protection and consumer protection, within the context of sustainable development. On the other, the various environmental issues related to products. It is important to guard against passing problems from one area to the other. There must be an integrated approach to the issue. All the Community institutions must work together too. That is the way to ensure the co-legislators can agree to mandating the Commission with regard to the adoption of measures to be applied to specific products.
I should like to highlight the main features of this proposal. As its title indicates, the proposal is aimed at improving the environmental behaviour, what could be termed the Eco-design, of energy-using products. The free movement of products meeting the requirements, the protection of the interests of consumers and the competitiveness of our economy are essential, however.
We appreciate that the correct implementation of these proposals could prove extremely beneficial to all parties. There are a number of reasons why this could be the case. Industry will be motivated to improve the environmental characteristics of products with a significant capacity for self-regulation. Thanks to the large market in investment and design improvement, fragmentation of the market will be avoided and investment will pay off. Further, the measures will be aimed at swift compensation for the consumers and will take account of the nature of the market in the enlarged Union.
This is probably the first time that a proposal provides a consistent global legislative framework thus avoiding thematic legislation. The latter can sometimes prove contradictory. Integrated product policy aims to avoid risks of this kind.
Energy consumption is one of the main ways in which products interact with the environment. I am glad this has been emphasised in the discussions in the various committees charged with considering the proposal.
Regarding the institutional dimension of this issue, we propose moving from codecision to comitology to deal with specific products. This is because we feel it is a flexible way of handling technical matters. I have in mind for example rapidly-changing technologies and arrangements for consulting stakeholders. I could also mention the development of self-regulatory alternatives for a range of products that is, in our view, too wide to be dealt with through codecision. It would be too slow and therefore less efficient to attempt to do so.
I shall comment in detail later on the amendments the House is to table. At this point, however, I should like to say how very constructive I feel the debates in the Committee on the Environment, Public Health and Consumer Policy and in the Committee on Industry, External Trade, Research and Energy proved. Particular congratulations are due to Mrs Thors, to Mr Turmes and to all the rapporteurs, for trying to reach agreement at first reading. 
Thors (ELDR ),
    Madam President, Commissioners, it seems to be ladies’ night here this evening.
The aim of eco-design is to integrate technical possibilities when they are at their greatest. More than 80% of environmental damage is determined at the manufacturing stage of a product. We learnt this whilst considering this Directive. We also know that the EU has adopted many rules to eradicate dangerous substances. We have rules on waste management with quantitative targets for recovery and reuse. It was a relatively natural course of action, then, for the committee to lay a certain emphasis on energy consumption, in particular, in its consideration of the proposal.
I should like to make a point of this, as strong criticism seems to have been levelled at our work, stressing the energy aspect. This is against a background in which energy consumption has continued to increase substantially in most parts of Europe, and many Member States are having difficulty meeting the Kyoto objectives. New tools for saving energy are important, therefore. Latest reports in my home country indicate that it is set to exceed the CO2 emissions quota for the 2005-2007 period by 14%.
Criticism has also been levelled at the ‘top-runner’ approach that we have used here. I believe, however, that there is a great deal of misunderstanding about what we mean by this. We want the leading and best technology as a yardstick for future implementing measures. This forms a framework for decisions, but does not exclude anyone from the market. On the contrary, I think that we have a system that leaves scope for continuous improvement.
The report is also criticised for not having heeded the three pillars of sustainable development. It is said that we have given priority to the environment at the expense of social and economic issues. That criticism is wrong, and I think that this is self-evident if one studies what we say about the life-cycle approach and our support for small- and medium-sized enterprises. We are aware of the economic issues, the social issues and the possibilities, but also the risks.
When all is said and done, early attention to environmental issues, as the Commissioner also said, is more economical than many other methods of environmental governance, for instance subsidies, and also labelling, unfortunately. It has become apparent that we obtain very little value for money from subsidies at the intervention stage.
I should also like to point out that, just as we did when we were considering the Green Paper on Integrated Product Policy, we have given our support here to measures applicable to SMEs. We also call on the Commission to establish a database in order to facilitate the incorporation of the life-cycle approach and eco-design into the activities of all enterprises. This is an innovative concept. The scope is broad, but in actual fact what we have here is an organised regulatory framework for how to proceed, how to choose what is important and how to set requirements in the future: the prototype for good governance, in other words.
There have been no objections here in Parliament to the fact that the European Parliament will not in future be determining how much energy a product should consume. On the contrary, we are saying that this will be determined where there is the expertise. In my opinion, what we are proposing is an important simplification.
Self-regulation also has a role to play, in Parliament’s view, but only if it produces better, faster results than would the regulated procedure.
Unfortunately, although I did not quite catch what the Commissioner said at the end, I do not think that this Parliament will at any rate be able to reach agreement with the Council at this reading, and that means we lose a fair amount of time. We had wanted to make faster progress, and we want the Directive to define a work plan, including for the products that are responsible for 40% of carbon dioxide emissions. We want to proceed quickly, as it is our opinion that much time has been lost.
I wish to thank my fellow Members for their constructive cooperation on the preparation of this report. I should like to express my thanks for your understanding when I took over from Mrs Ries, who became Belgian State Secretary for European Affairs. I should also like to thank the Commission for its goodwill in wishing to reach a speedy agreement with the Council.
I also think that we have been very united, and that has been a great strength. Our views still differ on a number of small points, for instance with regard to the legal basis and conformity assessment, but we shall not let the details obscure the fact that we have been united. Parliament wants rapid progress and wants to implement the necessary measures promptly. I hope that the Council, and Parliament with the new Members elected after us, will be able to reach swift agreement on this so that there is no further delay to these important measures. 
Turmes (Verts/ALE ),
   . Madam President, the design of appliances, IT systems and industrial motors is crucial not only for climate change and security of supply but also for the overall economy in Europe. This offers the single largest potential in respect of climate change, and also the most immediate potential because turnover times for such appliances are sometimes two to three years and at most ten to fifteen years, which is much quicker than for energy infrastructures. It also represents the cheapest potential, because the additional money spent on upgrading a design is more than compensated for by reduced electricity costs during its life cycle.
Unfortunately, the European Union is lagging behind other economies, such as Australia, the US and Japan. Even China now performs better on standard-setting than the EU. We are pleased, therefore, that the EU Commission has come forward with this proposal and that Parliament was able to strengthen the proposal. A good eco-design directive is important not only for Europe but also for the world. There will soon be between 500 and 700 million new middle-class citizens in India, China and other such countries, so the single biggest challenge for the world economy is to be able to offer efficient demand-side products, such as appliances and computers. Otherwise we can simply forget about climate change. This also constitutes a huge opportunity for European industry because it will open up an enormous market. Unfortunately, sections of European industry have been lobbying for a weak directive. Why? These are the same industries that want to delocalise production to India, China and similar countries. This shows that the same industrialists who do not care about the global environment also do not care about creating added value and jobs in Europe. I hope the Council will not give in to these lobbyists. 
Liese (PPE-DE ).
   – Madam President, Commissioner de Palacio, ladies and gentlemen, cutting the amount of energy used by appliances is to everyone’s benefit. It benefits the environment, enabling us to meet our Kyoto targets faster and more cheaply, and it benefits the consumer, because he saves on his electricity and energy bills. It is also an opportunity for industry to put innovative products on the market, especially if we have uniform standards here all across Europe. The Group of the European People’s Party (Christian Democrats) and European Democrats therefore greatly welcomes the European Commission’s proposal and we expressly thank Commissioner de Palacio, for her commitment.
Like the other groups, however, we would like a few changes to the Commission’s proposal. We want greater clarity about what the Commission will actually do with these powers in the next few years. For that reason, we would like a list of products that will be subject to implementing measures in the first few years if there are no voluntary agreements to achieve the same objective faster. We want the text to contain fewer vague legal terms, and above all we want very strict supervision of the market; that is a priority for the PPE-DE Group. We cannot have a situation, with this or other matters, where honest people eventually lose out, where a person who only applies the EC mark when he really keeps to the rules is punished because others stick the mark on without complying with anything. That is why there must be extremely severe penalties. We must have better controls and the requirements must be such that they actually can be controlled.
We must be ambitious, because only then will there be no motivation for individual Member States to go beyond the minimum standards. That is why we are being flexible in the matter in voting for the two legal bases tomorrow if the aim is ambitious, and the Council’s reaction discourages me a little here. I am very disappointed that the Irish Presidency and the Council as a whole are being so hesitant. It will encourage individual countries to go it alone. I do not think that is a good thing. We need common European standards, and I must personally say that in my ten years’ work in the European Parliament I have seldom seen the Council behave so destructively or a presidency handle a matter so badly.
I appeal to the Council and above all to the Irish presidency, which unfortunately is not represented here today, but perhaps someone can pass the message on, to be guided by Parliament’s amendments, at least when working on the common position in June. If they do not do that, if the Council simply ignores these amendments, then we will have a rag bag of national rules, we will miss the Kyoto targets and consumers will continue to waste money unnecessarily on power and energy. Then the Irish presidency will have failed on this point. Its last chance is to really follow Parliament and I strongly appeal to it to do so. 
Scheele (PSE ).
   – Madam President, Commissioner de Palacio, ladies and gentlemen, I would like to offer the rapporteur my most sincere congratulations and also my thanks. She has taken on a very difficult and highly complex dossier at relatively short notice. Coordination in the European Parliament has not suffered at all as a result.
We have already heard a large number of good arguments this evening for why it is so important for our environment and for the creation of incentives for industry that we should adopt this directive quickly. I therefore share my fellow Members’ disappointment that no agreement was reached with the Council at first reading. I understand that it is of course a very difficult dossier for the Member States, too, but we in the European Parliament have shown that, despite starting from very different positions, it is possible to come closer on very important issues.
One point on which we have not been able to agree and where tomorrow’s vote will show what the European Parliament’s position is, is the question of the legal basis. For me, it is quite clear from the title of this directive that environmental protection is one of its priorities. That is why I do not find it satisfactory to take only Article 95, the internal market article, as the legal basis.
If we want a good environment and energy policy, it makes no sense to put Member States that are more advanced or have stricter requirements in a particular matter on a leash and shackle them. I know that the debate between those present has already been closed, but I would like to underline once again here that I and my group think it is very important to have two legal bases if there is to be a better environment and energy policy in the Member States. 
Davies (ELDR ).
    Madam President, industry complains about regulation and interference from Brussels. I can hardly think of legislation more likely to cause concern to some manufacturers than that which indicates in such detail how they will make their products and what minimum standards of energy they must achieve, with lots of detailed specifications still to come, appliance-by-appliance, determined by the comitology procedure and very much out of the public gaze.
How do we justify interference in the private market on such a scale – interference and the setting of standards that go far beyond health and safety requirements? I believe that the potential benefits of energy-saving, of making more efficient products and of reducing carbon dioxide emissions speak for themselves. I am concerned that in an attempt to reconcile the different requirements of Member States – between hot countries and cold countries – the Commission may come up with compromises that set standards well below the best that can be achieved. I urge the Commission to be ambitious.
This is a positive move. In selling it to citizens and consumers alike, there is a simple message: by cutting energy use we can help them save money and we can all contribute to do our bit to save the planet. 
Bowe (PSE ).
    Madam President, I would like to focus on one specific issue. We have talked in broad terms of the importance of this report and the importance of the global effects it might have. But let us look at one small issue and how this report could affect it: let us take a look at ink-jet printer cartridges, probably one of the most widely used products in the world. The reality is that all the large manufacturers are using every trick in the book to prevent consumers getting a fair deal, at the same time undermining the need to improve energy efficiency, which is a crucial element in protecting the environment.
The manufacturers need this legislation to make them do the right thing. There is big money at stake here. On average a refill cartridge can be sold for about half the price of a new product, and the consumer should have the change to reap the benefits. We need amendments in this report to ensure that those cartridges are refilled.
Research carried out by organisations such as the Consumers' Association has highlighted the kinds of tactics adopted by some of these big-name companies. For example, the installation of microchips which suggest that cartridges are empty and even in some cases stop printers working, when in fact they have plenty of ink left. This is a waste of resources and a waste of energy.
Surveys demonstrate quite clearly a variety of different costs of different printer operating systems, all brought about by operators using these methods which oblige the consumer to buy printer cartridges over and over again, instead of reusing and refilling.
If we can build into the new eco-design legislation a requirement that cartridges must be refillable and recyclable, it will be a major step forward in both protecting the rights of the consumer and benefiting the environment. 
De Palacio,
   .  Madam President, ladies and gentlemen, I should like to reiterate my congratulations to the rapporteur, Mrs Thors. Congratulations are also due to Mr Turmes, draftsman of the opinion of the Committee on Industry, External Trade, Research and Energy. I should like to thank both honourable Members for their work and contributions to the debate.
I certainly believe that what we are concerned with here is a major initiative. It could have a real impact on the aim of decoupling growth from increased energy consumption. Significant savings in energy consumption can be made. I agree with the honourable Members who pointed out that presenting an overview of the whole process is the best way to avoid deluding ourselves. After all, there is no point in economising in part of the process of creating a product or in part of its useful life if the end result is a negative overall balance.
A detailed list of the Commission’s position on the various amendments will be forwarded to the Presidency(1). Nonetheless, I should like to say a few words on some of the issues raised and discussed in the course of the debate.
I shall deal first with the question of Council approval. I would like to make it clear to the House that I had hoped this text would be agreed with the Council, and I did my best to ensure agreement, as this would have enabled the text to be adopted at first reading. The fact is that when it came down to it, the Irish Presidency encountered serious obstacles to achieving our objective the first time round. Nonetheless, I feel it is very likely that this text will be adopted at second reading, should it prove impossible to adopt it at first reading. As many honourable Members have pointed out, the matter is urgent. It is essential to put this new Community regulation in place once and for all. In addition, comitology procedure must be launched. The procedure needs to be sufficiently flexible to adapt to subsequent change and technological development. It must also be able to provide an appropriate response on more specific matters.
On the subject of comitology and lack of control by Parliament, I should like to remind you, ladies and gentlemen, that we are party to global generic agreements concerning good legislation and the institutions’ capacity to forge links between themselves. I believe these agreements provide sufficient assurance that there will be no deviation or real difficulties regarding the implementation of these measures.
As to the legal basis, Parliament’s Committee on Legal Affairs and the Internal Market has confirmed that Article 95 of the Treaty is the only appropriate legal basis for this proposal. I endorse this view, and hope you will too.
These are the key issues I wished to mention. I must emphasise the urgency of adopting this measure. I very much hope that by the time we meet again in June, the Council’s common position will be as close as possible to the proposal put forward by Parliament itself. Adoption of the text at second reading should then be fairly straightforward, always supposing it is not adopted at first reading. I hope adoption will be possible as soon as the new Parliament assembles. The text certainly needs to be adopted before the end of this year. 
President. –
   The debate is closed.
The vote will take place tomorrow at 12 noon.(2) 

President. –
   The next item is the report (A5-0154/2004) by Mr de Roo, on behalf of the Committee on the Environment, Public Health and Consumer Policy, on the proposal for a European Parliament and Council directive amending the Directive establishing a scheme for greenhouse gas emission allowance trading within the Community, in respect of the Kyoto Protocol's project mechanisms. 
Wallström,
   . Madam President, first I should like to thank the European Parliament and especially the rapporteur, Mr de Roo, for the work on the report and, in particular, the very constructive attitude in the negotiations on the compromise package, which should allow us to reach a first-reading agreement on this important proposal.
A first-reading agreement on what is termed a 'linking' directive will have been reached within a mere 10 months, confirming the European Union's strong continuing commitment to the Kyoto Protocol and its flexible mechanisms. A first-reading agreement reaffirms the high priority that the European Union gives to taking concrete action to tackle climate change. It will provide an important signal to our partners, in particular developing countries and economies in transition, including Russia, of our continuing support for the Kyoto Protocol and our firm intention to tackle climate change multilaterally. It will assist our partners in their sustainable development through the transfer of environmentally sound technologies and know-how.
The compromise package before Parliament will give an important boost to the Kyoto Protocol and its project mechanisms: Joint Implementation and the Clean Development Mechanism. It will create a demand for credits from JI and CDM projects by allowing around 12 000 companies across Europe to use Joint Implementation and Clean Development Mechanism credits for compliance with their obligations under the EU Emissions Trading Scheme. By doing so it will enhance the cost-efficiency of the EU Emissions Trading Scheme in a way that also benefits developing countries and economies in transition.
I want to emphasise that the agreement being discussed today is fully consistent with the Kyoto Protocol's implementing provisions, which are usually referred to as the Marrakech Accords. As you know, the Kyoto Protocol contains no provisions on how companies can use JI and CDM credits. This directive now clarifies how this will be implemented by the European Union.
The compromise package before you is very delicately balanced. It addresses Parliament's concerns by providing a careful balance between the quality and quantity of the Joint Implementation and Clean Development Mechanism credits to be used in the EU trading scheme while at the same time keeping it robust and simple.
The Commission would now ask you to support this compromise package and, in doing so, take another determined step in strengthening the European Union's response to the challenge of climate change. 

De Roo (Verts/ALE ),
   .  Madam President, I should like to start by thanking my fellow shadow rapporteurs: Mr Davies of the Liberals, Mr Bowe of the Socialists, Mrs Garcia-Orcoyen Tormo of the Christian Democrats and Mr Blokland of the EDD Group. I am indebted to them for the unanimity and support. I would thank the Irish Presidency for its constructive way of negotiating. I also wish to thank the Commission, which has cooperated well, although it is not formally obliged to do so. I am also indebted to Commissioner Wallström. We have reached an agreement at first reading. I will list nine points. In my view, the result is sound.
Point 1: this linking directive enters into effect as soon as 2005. Companies can start now; they are given legal certainty now.
Point 2: this linking directive is independent of the coming into force of the Kyoto Protocol, as is the law on emission trading. For us in Europe, Kyoto is starting to take effect now. We will not wait until Russia ratifies Kyoto. One hundred and twenty countries, two-thirds of the world population, have already ratified Kyoto.
Point 3: energy companies and large firms can now earn emission allowance by investing in the switch from Chinese coal-fired power stations to gas, in making coal-fired power stations more effective, in solar power stations in Indonesia, in wind farms on the coastlines of developing countries or in retrieving spent gas from rubbish tips. There are many more possible ways to reduce CO2 and other greenhouse gases.
Point 4: we have followed the Kyoto Protocol in deciding that the construction of nuclear power stations is not permitted.
Point 5: carbon sinks are out of the question because – or so this House sees it – growing trees are only an interim solution. Trees fall over or burn down. Even if trees die a natural death, they expel all the carbon absorbed. Biomass or bio-fuels, however, are very much an option. Governments can also gain experience with sinks.
Point 6: large hydro-electric power stations are only possible if the criteria of the World Commission on Dams are observed. Although hydropower actually helps in the fight against climate change, ecological and social criteria should also be taken into consideration. On this score too, we are stricter than the Kyoto Protocol.
Point 7: the agreement that the Member States have to make half of their Kyoto efforts in their own countries and half abroad, has been re-confirmed. Agreements only to commit industry to the ceiling make no sense, because this leads to governments, at least some governments, making 50% of their investments abroad, with industry making a further 25% of the countries' investments abroad. Ultimately, only 25% will be invested at home and 75% abroad. By acting in this way, we would put our ecological credibility on the line.
Point 8: outside Europe, there is a great deal of interest in our system of emission trading and in this linking directive. Fifteen states in the United States and four provinces in Australia intend to set up comparable emission trading systems. The Commission will be examining whether they can plug into our European system. The same applies to Canada and, hopefully in future, also to Japan. In that way, a start is being made on the implementation of the Kyoto Protocol before it enters into effect officially.
Point 9: we will need to extend the scope of the emission trading system to include aviation and subsequently also road transport. This is preferable to opting in favour of domestic Joint Implementation Projects, as is being suggested by some.
Finally, the French Government and French industry have no faith in this linking directive. Neither has Greenpeace. This is old-fashioned dogmatism. I am pleased that all political groups, the Council of Ministers and the Commission have more insight and are prepared to support this compromise. Climate change is deteriorating by the day; we must act in unison. For climate change, it makes no difference where the greenhouse gas is produced. Armed with this linking directive, we will now enter upon the worldwide struggle to solve the climate issue. 
Linkohr (PSE ),
   Madam President, I, too, would like to thank the rapporteur for his excellent work and I hope that one reading will suffice.
I would like to concentrate on just one thing, namely sinks. I disagree on this point. I have just returned from a trip to South America as part of an official delegation. Surprisingly enough, they have been looking very closely at this Linking Directive, at any rate in some of the ministries, and I was repeatedly told how important it is for them that sinks, in other words forestry, should be included. I can see why. If we included forestry, it would be an extraordinarily great help not least in fighting poverty in those countries, or in creating alternatives to drugs in places where they are cultivated.
I would also like to mention that just under a year ago France concluded an agreement with Colombia which did include forestry; there is therefore a conflict between Parliament and the Council of Ministers that we will not survive in the long term. 
García-Orcoyen Tormo (PPE-DE ).
     Madam President, Commissioner, ladies and gentlemen, it is now some two years since the Emissions Trading Directive opened up a new way forward for the most polluting sectors of industry. These sectors were to become involved in the struggle to reduce emissions of CO2 into the atmosphere. This represented a complex first step that was only taken recently. It was certainly necessary if the European Union is to make progress towards meeting its commitments on climate change. It is true, however, that a climate of fear and misgiving developed with regard to practical implementation.
This is why the changes contained in this linking directive are so significant. The present linking directive allows the implementation of clean development projects. It also provides for the recognition of emission reduction certificates. The linking directive sends out an important political signal from the European Union to the developing countries, indicating that, by way of these projects, developing countries are likely to obtain far more substantial aid than they probably do at present for environmentally friendly development. A message is also being sent to the sectors concerned making it clear that the European Union really does intend to implement the means to facilitate involvement in trading in emissions rights.
I believe Mr de Roo, the rapporteur, fully appreciated the need to ensure the linking directive was very flexible. He therefore worked admirably with all the political groups. In addition, he conducted excellent negotiations with the Council. I trust all this will bear fruit tomorrow and that a majority of the House will vote in favour at first reading.
Nonetheless, it seems some opportunities were not seized or perceived as such. Further, some of the progress has been too faltering. Consequently, the flexible mechanism is not as flexible as it ought to be. The rapporteur is aware of this, as we have discussed it together.
I have in mind firstly domestic or national projects, implementation of which has been restricted to rail networks. I feel it could have been possible to accept a far wider range of situations without detriment to the spirit of this directive.
I also feel excessive caution was exercised when deliberating on the admissibility and implementation of hydro-electric projects. I believe such projects are needed in these countries, and that they are adequately provided for in the Marrakesh agreements. Further, I agree with Mr Linkohr that sinks are called for in these countries too, and that excessive caution has been exercised in this regard also.
Nonetheless, there are some very positive developments worthy of note. One of these is the solution of the problem of supplementarity. I could also mention the capacity of the Member States to organise themselves, share common objectives and determine the best mix of appropriate policies in order to achieve them.
I believe this is an excellent result, and would like to congratulate the rapporteur once again. 
Bowe (PSE ).
    Madam President, I welcome this agreement. It is absolutely essential to ensure the workability of the emissions trading system when it starts in January 2005. I want to congratulate the rapporteur on the work he has done. I have seen a lot of rapporteurs and he really has done a very good job. He has secured an agreement with the Council which is a practical compromise and which will reap considerable environmental rewards whilst providing for industry a great deal more certainty than the original proposal.
I am happy that we have been able to retain the cap on the number of credits issued. It is a sensible solution allowing Member States to monitor and control the market and make sure it is not flooded. On specific issues, I believe we have been able to persuade the Council of the need for greater reflection on whether to include domestic projects. The guidelines we have laid down there are useful.
As regards 'sinks' I feel we have the best possible deal: a prohibition on companies using credits from land-use projects and carbon forest sinks until at least 2008. We will find this is a very difficult thing to calculate and we need time to look at it more closely.
Concerning big hydro and nuclear projects, it seems disappointing if we wanted the allowances for such projects excluded permanently from the scheme, but in reality Parliament has been able to ensure that the projects and the take-up within the European scheme are at least in line with Kyoto and the World Commission on Dams and the Marrakech Accords. It is not really a bad result.
Our message to EU governments is clear: real, environmental improvement through emissions reductions must be brought about by long-term, sustainable effort at home and not by cheap, ill-advised and potentially detrimental projects in the poorer countries. Member States: we will be watching you! 
Davies (ELDR ).
    Madam President, no sooner had agreement been reached with the Council, than Greenpeace, the WWF and the RSPB were denouncing it as inadequate and calling on Members to throw it out. Some Members may vote against it when the time comes, but they will probably come from amongst those who tend to put the interests of industry before those of the environment. I am not really sure whether WWF counts them amongst its friends.
I took a certain malevolent delight, especially with the election approaching, in our Green rapporteur having been denounced by Greenpeace for his work, but personally I congratulate him. He has done a great job in keeping all sides of this House together. Of course the agreement is weak, but we have to start somewhere. The reality is that we know there was resistance, even amongst some Member States, towards the implementation of these measures.
I am glad that the EU is still trying to lead the world on the whole issue of climate change. However, the real issue is, firstly, that we have to get some sort of agreement up and running and, secondly, that we have to move forward. I am concerned about what will happen if the Kyoto Protocol does not come into force. That is the key question that the Commissioner is seeking to address this week with colleagues. Can we persuade Russia – the crucial element in the equation – to sign up to the Kyoto Protocol and bring it into force? I do not like having to give in to ransom demands. However, for once, it might be a price worth paying. 
Oomen-Ruijten (PPE-DE ).
    Madam President, last year, Mr Moreira da Silva, who was at the time a Member of this House, concluded an agreement with the Council on the trade in greenhouse gases. That was not easy, because the agreements that had already been reached in a number of countries with industry to reduce greenhouse gases had to be incorporated in European policy. Today, or in actual fact, tomorrow after the vote, what I see as a fresh agreement will have been reached and new arrangements will be in place by means of which emission trading will be extended to include third countries. I am proud that we, the European Union, have demonstrated that we are serious about Kyoto and that we not only conclude agreements but also live by them.
We, in Europe, have adopted defensive policy in the environmental field for too long. With the new CDM – Clean Development Mechanism – instrument and joint implementation, we can once again take the lead on the world stage. Thanks to the development and export of clean technology, we are creating a new market for cleaner production processes. Our European industry stands to benefit from this. However, I expect the transfer of environmentally-friendly techniques also to help developing countries to introduce sustainability and it will also bring them more prosperity. The exchange projects that can now be implemented with the developed countries or with countries in the process of moving towards a market economy, expand the market on which emission is being traded and thus reduce the costs per reduced tonne of greenhouse gas – a high environmental yield at the lowest possible costs.
In the Committee on the Environment, Public Health and Consumer Policy and also in discussions involving the rapporteur, much has been said about the risks which placing the reductions outside of one’s own Member State can entail. Since we have now agreed at European level that joint implementation and CDM are all too supplementary, we have to settle for the review that has been arranged.
What matters now is that industry takes what is now available. Mr de Roo has done his level best, on which I should like to congratulate him warmly. He has made sound negotiations possible, for which I should like to thank him. 
Liese (PPE-DE ).
   – Madam President, Commissioner Wallström, before turning to the de Roo report I would like to say a word about emissions trading in general, about the Moreira da Silva report, which Mrs Oomen-Ruijten also mentioned. In the Moreira da Silva report, Parliament proposed introducing an upper limit, a cap, for the national allocation plan, and we wanted every country’s national allocation plans to set the same limits. Unfortunately, the Council rejected the amendment at the time. That is one of the reasons why we are now faced with a situation where we have a hotchpotch of national allocation plans which are not really compatible with each other. Many Member States had still not notified a plan by 31 March at all, and some have submitted plans that are far from ambitious. I would like to expressly support you, Commissioner Wallström, in your commitment to encourage the Member States to implement the spirit and content of this directive, and if necessary bring proceedings before the European Court of Justice to oblige them to do so. Even though Parliament’s amendment was not adopted verbatim, the requirements of Annex III do not in fact allow industry to be granted generous increases in emissions. It is therefore very important that you keep your eyes open here. We have also written a letter to that effect to the President of the Commission, Mr Prodi.
We cannot allow industry in those Member States that are relatively ambitious to suffer because a few Member States continue to believe they need not do anything at all; something must also be done at home, important as Joint Implementation and the Clean Development Mechanism are.
This brings me to the de Roo report. I believe the de Roo report is an important step forward in international climate policy. We are strengthening the Kyoto process and we have also shown that there are certain limits here. Unlike Mr Linkohr, however, I believe we were right to stick to the position of not including sinks. You are almost always right, Mr Linkohr, but I believe you have miscalculated here, even if you are a physicist. In emissions trading itself we have an emission factor of zero for biomass, which means you do not need certificates at all if you burn biomass. Biomass burning gains a great deal from that. If we now also pay money for planting trees, we have deceived ourselves and are not protecting the climate. 
Wallström,
   . Madam President, firstly – and you have heard me say this before – we will have to live with the issue of climate change for a very long time – maybe for generations. It will pose a challenge to humanity for generations to come.
It is important that the European Union should continue to show leadership on this issue. We should continue to demonstrate that we are willing to take action at home and internationally, that we believe that a truly global problem also requires a global solution. We will also have to be cost-efficient. To be credible, we will have to look at the most cost-efficient solutions; this is part of that process, and in doing so we will be able to mobilise all the various groups of stakeholders. This will help us to do so. My thanks for this again go both to the rapporteur and to the whole European Parliament.
I would like to comment on two points mentioned during the debate. First of all, Russia. As has been mentioned, a team of Commissioners will be going to Russia later this week in order to discuss a number of issues, including many areas of cooperation with Russia. We should not wait for Russia – that is true – but the 120 countries that have ratified are not waiting; they are actually carrying out actions on the issue of climate change already. However, we should of course keep up the pressure on Russia and make it clear to the Russians that they hold the key to the entry into force of the Kyoto Protocol, that what they do is important, and that we are counting on them. Therefore we will continue to work on that.
The other issue is an important one: the argument about sinks and our position on sinks. Again, I am satisfied that our position on sinks is consistent, since in all the negotiations on the Kyoto Protocol we have remained rather sceptical on sinks – at least until such time as we can monitor and control sinks and count them reliably.
That is one of the arguments, the other being the temporary nature of sinks and emission reductions from them. We have also pursued our line in this proposal and I welcome that. These are the arguments. We still have too many uncertainties, and we have to clarify those; but of course they are in the Kyoto Protocol, and one day I hope that this will also be another opportunity for Brazil and other countries. However, as long as we do not have full knowledge, we should be careful.
This will be another effective instrument within our climate change policy. 
President.
   Thank you, Commissioner Wallström.
The debate is closed.
The vote will take place tomorrow at 12 noon.
Bonde (EDD ).
    Madam President, there are more than 63 of us who, as Members of the European Parliament, have tabled a motion of censure on the Commission, not because we lack confidence in all the Commissioners but because it is the only means we have of attributing responsibility for the Eurostat scandal. We ask the Commission to attribute responsibility itself and, if it will not do so, we are obliged to table our motion of censure covering everyone.
There are 67 signatures, 60 of which were verified a couple of hours ago. There are two further signatures verified by the services, and there are two that the services are declining to verify and in connection with which we have delivered written confirmations. There should now, therefore, in any case be 64 signatures with the services, and the Bureau thus has no other choice than to note that a motion of censure has been tabled with 63 signatures, in other words the necessary number of signatures. It must therefore be placed on the agenda within 24 hours, and there must be a vote within 48 hours.
I hope that the President is in a position to note that the 63 signatures have now been obtained and that the services are not interpreting the Rules of Procedure properly by trying to get people to withdraw their signatures. 
President.
   We have noted what you say. We shall of course look more closely at the issue, check the names and come back to the matter tomorrow. 
President.
   The next item is a report (A5-0265/2004) by Mr Blokland, on behalf of the Committee on the Environment, Public Health and Consumer Policy, on the proposal for a European Parliament and Council directive on batteries and accumulators and spent batteries and accumulators. 
Wallström,
   . Madam President, I wish to begin by thanking the European Parliament, the Committee on the Environment, Public Health and Consumer Policy and in particular the rapporteur, Mr Blokland, for his report.
The Commission proposal for a new battery directive seeks to extend the scope of the existing Community legislation on batteries and accumulators containing certain dangerous substances to all batteries and accumulators placed on the Community market. Today the existing legislation covers only 7% of all the portable batteries sold each year in the European Union. This has hindered the setting up of efficient national collection and recycling schemes. Consumers have also been confused as to what is to be collected, and what not, and have therefore not participated effectively in the national collection schemes. Consequently, today many batteries still end up in the environment. In 2002, for example, approximately 45% of the total volume of portable batteries sold in the 15-member EU was landfilled or incinerated.
The current proposal aims to achieve a high level of environmental protection while at the same time contributing to proper functioning of the internal market for batteries. In this respect the Commission's proposal has two main goals: creating a closed loop system for all batteries and accumulators, and introducing a producer responsibility scheme. The proposed closed loop system requires Member States to take all necessary measures to prevent final disposal of spent batteries and achieve a high level of battery collection and recycling. I am confident that the proposed collection targets for portable batteries, in combination with the proposed high recycling targets, will protect our environment against the risks involved in the disposal of those batteries. Moreover, the proposal addresses the issue of the uncontrolled disposal of hazardous batteries containing mercury, cadmium or lead. In this respect, in addition to the existing restrictions on the use of those substances, established by the end-of-life vehicles directive, the following additional measures would be introduced: a ban on landfilling and incineration of all industrial and automotive batteries, which covers most batteries containing lead or cadmium, and an additional collection target for portable nickel-cadmium batteries, which requires monitoring of the waste stream to determine the volume of discarded portable NiCad batteries. The extended impact assessment has identified the proposed policy options as the most sustainable from an economic, social and environmental viewpoint.
I turn now to the introduction of a producer responsibility scheme. The application of the producer responsibility principle is an important step towards incorporating the external environmental costs into the production phase and, at the same time, towards encouraging producers to market more environmentally friendly products.
All batteries and accumulators should be diverted from the waste stream and recycled in order to avoid environmental damage and recover the various metals they contain. To achieve this goal, we need to create a closed-loop system and make battery producers responsible for the products they make. 
Blokland (EDD ),
   .  Madam President, Commissioner, ladies and gentlemen, on behalf of the Committee on the Environment, Public Health and Consumer Policy, I should like to elucidate my report on batteries and accumulators. At the European Parliament’s emphatic insistence, there is at long last a proposal by the European Commission. A number of points of the Commission proposal can be seen in a positive light.
First of all, all batteries fall within the scope of the directive. Secondly, there are binding collection targets. Thirdly, recycling percentages and recycling efficiencies are binding, and fourthly, producer responsibility plays a major role in the financing mechanisms.
In the Committee on the Environment, Public Health and Consumer Policy, we have held an extensive debate on batteries. More specifically, we discussed the avoidance of the use of heavy metals and collection targets. Agreement has been reached with all groups on most points in the Committee on the Environment, Public Health and Consumer Policy. Even about the collection targets for batteries, we have reached a broadly supported compromise. Since the sales figures for batteries differ quite considerably from one Member State to another, certainly after 1 May, a decision has been made in favour of proposing a percentage of the sales as the collection target.
As far as the avoidance of the use of heavy metals is concerned, developments have been underway for years. EU legislation now stipulates that the heavy metals mercury, lead and cadmium are prohibited in materials and parts of vehicles which are brought onto the market after 1 July 2003, as well as in new electrical and electronic appliances which are brought onto the market after 1 July 2006.
The key problem involving batteries and accumulators is precisely the presence of mercury, lead and cadmium, which are heavy metals. On pages 9 to 12 of the explanatory note to the Commission’s proposal, the harmful environmental and health effects of mercury, cadmium and lead are clearly described. For that reason, most batteries containing mercury were already banned in 1998. The guiding principle underlying drafts of the Commission’s revised battery directive has always been a ban on nickel-cadmium batteries. Surprisingly, the present Commission proposal has not opted for a ban on these, but for a so-called closed-loop system for cadmium. However, there does not appear to be a closed-loop system since only 80% of portable nickel-cadmium batteries need to be collected. Consequently, 20% of portable nickel-cadmium batteries end up as landfill or in an incinerator. Since cadmium is a volatile metal, it will, in the case of waste incineration, inevitably end up in the atmosphere. That is why the Committee on the Environment, Public Health and Consumer Policy has introduced a ban on mercury, cadmium and lead. In addition, we have included an extensive list with exceptions for cases in which no effective substitutes are available. This includes batteries for hearing aids, emergency lighting, industrial batteries, lead accumulators and cordless power tools. Although I personally do not think the last exception to be necessary, I have added it nonetheless in order to accommodate objections from a number of Members.
The substitute for nickel-cadmium batteries, namely nickel-metal-hydride batteries, operate at a temperature of -20° Celsius to +60° Celsius. As such, I can assume that these batteries can be used across the entire European Union.
Finally, I should like to react to the comic strip of the European Portable Battery Association, in which it is suggested incorrectly that all kinds of applications would no longer be permitted if the report by the Committee on the Environment, Public Health and Consumer Policy were to be adopted.
I have an old – four and a half years old – mobile telephone. This old telephone contains a lithium-ion battery. I am almost certain that the batteries in all your mobile telephones are nickel-metal-hydride or lithium-ion. In short, if nickel-cadmium batteries are prohibited for these applications, there is no problem whatsoever. Another example from the comic strip is that of lead accumulators in cars, which are not prohibited in the directive on end-of-life vehicles. Neither are they prohibited in the framework of the battery directive, because, as you heard a moment ago, they are included in the list of exceptions. The same applies to button cells in hearing aids and watches, cordless power tools, emergency lighting and all industrial applications.
Even the European consumers’ organisation BEUC is in favour of a ban on nickel-cadmium batteries for consumer applications. Although, as you are aware, there are plenty of alternatives, I noticed that industry is, in principle, against a ban, to such an extent that they are opposed to it to this day, even though all the exceptions they required have been made. I take the view that such arguments should not play a role in the decision-making. I suspect there is a dangerous tactic behind this. In this respect, it is worthy of note that industry, which is so very much resistant to a ban on nickel-cadmium batteries, is promoting alternatives for these on their own websites. We should therefore also promote these alternatives, namely by excluding harmful heavy metals from batteries as much as possible. 
Linkohr (PSE ).
   – Madam President, I have to admit that before I entered the European Parliament I was involved with nickel-cadmium batteries for ten years. We even built a factory and I took out a number of patents, which have now expired. I therefore have no economic interests to register. I also have to admit that at the time we did not give much thought to what was to be done with the things later. I therefore believe we are right to be looking at how such batteries can be recycled.
I would advise you not to ban things, however, but to introduce alternatives more quickly, and such alternatives exist in theory. Small fuel cells may easily come on the market this year or next and they contain no heavy metals. They also come from the same firms as make nickel-cadmium batteries, at any rate many have experience with them, and that would be my recommendation, instead of rushing straight to a ban. 
Goodwill (PPE-DE ).
    Madam President, batteries form part of our everyday lives. In fact it is fair to say that the development of portable electric power, particularly rechargeable electric power, has revolutionised our lives.
Each one of us is probably carrying two or three batteries – in our phones, in our watches, in our car key fobs and maybe there are even one or two heart pacemakers in this Chamber. Batteries have made a contribution to safety. Cordless power tools have made building sites much safer and often in the case of power failure we rely on batteries for back-up lighting or emergency power. Recently I was at a nuclear power station where they have a battery the size of a building which provides the back-up power in the event of a power cut.
I would like to congratulate the Commission on its proposal which is balanced and in proportion to the problem. In particular, I congratulate the Commission on the way it addresses the problem of waste.
Some countries like Belgium have successfully removed batteries from the waste stream. We should take care to look at the cost of this. In Belgium it costs at least twice as much to collect the batteries as the actual value of the batteries themselves. We need to have a market-led solution so that we do not find we are collecting things just for the sake of it.
As with most waste issues in my country, the United Kingdom's record is pathetic. When adopted, I hope that the targets set by the Commission will be met and we do not repeat the situation we had with old fridges when the directive gathered dust on the shelf until it was too late to implement it in time. I also hope that the UK government will correctly fund the local authorities which are charged with the task of collecting these batteries.
I support some of the amendments. In particular, my Group supports the move not to set recovery targets based on an arbitrary number of grams – 160 grams for every country. Such a one-size-fits-all policy would be bizarre in countries such as the Baltic States where the battery market is not even half of 160 grams. To set the recovery targets based on a percentage is a much more sensible approach.
However, my Group will not support the amendments to Article 4 with regard to the bans on heavy metal. Firstly, the alternatives are not developed in every single sector. In the case of power tools in particular the alternative batteries have not performed as well and we would see tools having a much shorter life and being thrown away sooner than at present.
Secondly, in the United Kingdom we have had a number of studies on pollution looking at landfill and incineration. Although we have cadmium in the environment, the source of cadmium from batteries is not significant. If we wanted to cut back we would need to look at fossil fuels, fertilisers and the metallurgical industries.
Lastly, the timescale. Batteries which are sold now will not come into the waste stream for more than 16 years. Therefore the heavy metal ban does not solve the problem in the short term. 
Lange (PSE ).
   – Madam President, Commissioner Wallström, we are indeed using more batteries, and that is causing us problems. Firstly, we want to make batteries environmentally friendly to use, and secondly we do not want them to make our waste problem worse than it is. This in fact means that we need a strategy that ensures that as few batteries as possible are landfilled, and secondly we must see to it that innovations are made in battery production.
I therefore also support the Commission’s approach of including all batteries in the legislation and of ensuring there is producer responsibility in battery production. I also agree with the many compromises we have reached together with the aim of making the collection and recycling of batteries better organised so that our waste problem will actually be reduced.
There are a variety of opinions in the House about how to encourage innovation and avoid heavy metals. The important thing is that we send the signal that we want batteries that do not harm the environment, do not contain heavy metals and are easy to recycle. Parliament must send this signal clearly so that the battery industry will innovate. That can of course also be done using various deposit schemes, with a higher deposit charged on hazardous battery systems than on the others. In the end, however, the consumer must also play his part. 
Davies (ELDR ).
    Madam President, despite the threat of a no-confidence motion, I hope that the Commissioner will not cancel her airline tickets to Moscow.
Lobbying has been intensive and persuasive over this issue. I must admit that my views on points of detail have changed many times, but I have come to the conclusion that, while backing a closed-loop recycling system for cadmium batteries in the medium term, we should be looking in the long term for the replacement of such batteries because of their toxicity. The many exemptions I shall be supporting show that I consider this approach to be a measured and balanced one.
We must be careful not to set a level of lead so low that it will effectively prohibit the use of batteries containing even trace elements of lead for important purposes, notably in hearing aids. I have no doubt that we will, in practice, be able to resolve these questions as we consider the legislation further.
I should like to touch upon the issue of collection targets for portable batteries. I am deeply cynical about these. I have been lobbied by the British Local Government Association, which wants me to support proposals for much higher targets – this from an association representing local authorities that currently only collect 12% of household waste. It all seems ridiculous. As we know, Member States all too often agree to what should be legally-binding targets in the certain knowledge that the pathetically cumbersome enforcement procedures that the Commission has at its disposal will mean that they never actually have to meet those targets within anything like the timescales proposed. As I have been saying for the last five years, we have to find better ways of getting ministers who sign up to these agreements to keep to their word. 
De Roo (Verts/ALE ).
    Madam President, cadmium is extremely toxic. In the water framework directive, we, that is the Council, Parliament and Commission, have decided to impose a gradual ban on cadmium. Why do we not do the same here?
The Commission has proposed a closed-loop system, but the rapporteur has already pointed out that only 80% is being recovered, which means that 20% must be disappearing into the environment. The Commission proposal is flawed in another way, namely the extraction of cadmium – a tiny amount of it – from the waste stream, which is huge; that is an extremely inefficient way of working, and so it is better to work on a ban and introduce a few derogations later.
Lithium-ion and nickel-hydride batteries are already on the market. In future, fuel cells will become available too. The alternative is thus in place. What is more, the market share of the alternative is already growing. That is why it is very regrettable that the Commission has succumbed to the pressure from part of the industry. European politics should reward the pioneers in industry and not those lagging behind, as the Commission is doing. Unfortunately, rewarding those lagging behind is exactly what the Christian Democrats and the Commission are doing. I hope that the majority in this House will know better. 
McKenna (Verts/ALE ).
    Madam President, cadmium is a dangerous chemical. It is carcinogenic and can cause serious damage to the nervous system. It also bioaccumulates, which means that it stays in the body and builds up over time. High exposure can cause severe lung, prostate and kidney cancer. The use of cadmium should therefore be banned. At the very least a ban on cadmium in household batteries would help to reduce cadmium levels and promote the use of alternatives in batteries over time. These alternatives to cadmium are what we really need, and they already exist.
Cadmium pollution of the environment carries very high health and economic costs, including water purification costs. These costs – or more correctly these potential savings – must be taken into account when considering the cost of a ban on cadmium batteries. If one looks at the dangers of cadmium one realises that we must seek out alternatives. There are alternatives and the only way we will achieve them is to impose a ban. In the long run this is the right approach to take for the sake of public health, consumer protection and the environment. The propaganda we have heard, which is completely simplistic and totally inaccurate, does nothing to help the debate, wastes the money of those who are trying to promote the opposite approach, and will not work. I hope that the Members of this Parliament will not be swayed by this simplistic rubbish. 
Wallström,
   . Madam President, I have distributed a list to the secretariat indicating which amendments are acceptable to the Commission(1). I will limit myself to commenting on two issues that have been raised during the debate and explain once more why the Commission did not propose a ban.
As you know, the Commission carried out an extended impact assessment in preparing this proposal. It has assessed the sustainability of different policy options, including a substance ban. It is important to recall that in this proposal the Commission has maintained a general restriction on the use of mercury in batteries, in line with the existing Battery Directive. The restrictions in the End-of-Life Vehicles Directive also continue to apply, so the provisions are there.
However, on the basis of this impact assessment, a substance ban for other batteries was not chosen for the following reasons: a substance ban can only be considered if viable substitutes exist. At the moment, these substitutes do not exist for all applications. A ban would always be limited in scope and would never be able to cover all hazardous batteries. As we have already heard, a substance ban might not cover cordless power tools, emergency lighting and industrial applications. In fact, a ban would only represent around 16% of the total nickel cadmium battery market and less than 6% of the total lead battery market.
A large percentage of these hazardous batteries are currently in use or stored at home. It is estimated that 60% of rechargeable portable batteries are 'hoarded' or stored at home. They would not be covered by the ban and would still risk ending up in the environment. For cadmium batteries, the substitutes have a shorter lifespan and are more expensive, so that would create more waste and extra costs for consumers. These are the main arguments as to why we chose a closed-loop solution.
We have proposed this closed-loop system for all batteries. That should ensure that batteries no longer end up in the waste stream but are collected and recycled instead. For industrial NiCad batteries the closed-loop system is guaranteed by the proposed ban on landfill and incineration.
Those are our main arguments. I suppose that this will be debated from now on, but we all seem to agree that it is important to monitor what is going on and find the best solution to make sure that these hazardous substances and batteries do not end up in the waste stream. They must be taken care of.
I thank you for your work on this report and for the debate. 
President.
   Thank you, Commissioner Wallström.
The debate is closed.
The vote will take place tomorrow at 12 noon. 

President.
   The next item is a report (A5-0261/2004) by Mr Wijkman, on behalf of the Committee on the Environment, Public Health and Consumer Policy, on the communication from the Commission to the Council and the European Parliament on Integrated Product Policy – Building on Environmental Life-Cycle Thinking. 
Wijkman (PPE-DE ),
    Madam President, Commissioner Wallström, environmental policy has so far been relatively successful in dealing with point source emissions from factories, power stations etc. It is a different matter where non-point source emissions are concerned, that is to say the effects of the consumption of goods and services. The problem we face is that total pollution in society, especially due to our habits of consumption, is increasing all the time. The European Environmental Agency has recently shown that the volume of waste in the fifteen Member States has increased by 15% since 1990. In spite of the fact that we have reduced pollution and are using energy and materials more efficiently, the gains are quickly being eroded by increased growth. Because the world’s gross domestic product is expected to increase by three or four times in the next 30 to 40 years, we must do something radical if we are not literally to be buried beneath an ever higher mountain of waste and pollution.
The Integrated Product Policy we are debating in this House today offers excellent opportunities for creating a framework of incentives to get us to move away from production and consumption models characterised by a consumerist approach to linear resource flows and, instead, to embrace resource efficiency, waste minimisation, controlled use of hazardous substances and expansion of the stocks of natural capital. If this is to happen, the Integrated Product Policy must, however, be based upon a long-term vision of how we are to change our industrial production model.
I think that what we have learned is that it is not sufficient to pollute a little less. We must strive to achieve patterns of production and consumption that are clean in themselves.
The advantage of an Integrated Product Policy is that it involves a comprehensive approach, that is to say it tackles the whole product chain from the extraction of natural resources via product design and the production phase itself to the stage at which the product’s useful life is over. The Commission’s proposal has a number of good features, but is still not sufficiently proactive. It seems as if the Commission has partly rejected the Integrated Product Policy in favour of the thematic strategies. I see it not as an either/or but as a both/and. We need the thematic strategies, but we also need a framework for the Integrated Product Policy in order to hold the policy together and to be a driving force in its actual implementation. In general, environmental policy and also energy policy must become far more coherent and consistent. We now have an abundance of directives and regulations, but too little attention is given to the bigger picture.
In its proposal, the Commission talks about using voluntary methods as far as possible. EMAS and ISO are obviously constructive, but research shows that they are not enough. On the Commission’s model, voluntariness is also linked to market forces, that is to say to working with the market. Because it is extremely rare for environmental costs to be factored into the prices, the market does not, however, operate satisfactorily. Companies must be given direct incentives, that is to say be able to earn money from developing environmentally adapted products. That is rarely the case at present, in which case how is the market supposed to be able to help?
In its communication, the Commission talks about improving information for consumers. That is good, but it is naïve to believe that better labelling and better environmental information will solve this problem. I myself have been involved in developing environmental labelling in Scandinavia, and I know how difficult it is to implement it on a broad front.
As I see it, we need to place the Integrated Product Policy within a dynamic framework that supplies guidelines for policy in general and provides support for the thematic strategies. This framework should be characterised by a clear vision, based partly on the following principles.
Firstly, a systems-based approach, of which life-cycle thinking is the very core. Secondly, an enhanced understanding of how natural systems and the eco-system work so that companies’ product and business models might be adapted along biological lines. Thirdly, the optimisation of the product design process by the selection of materials that have as little environmental impact as possible. Fourthly, the principle that products whose useful life is over must be broken down into their component parts and either re-used or, if they consist of biologically degradable materials, progressively integrated into natural cycles. Finally, much more thorough use must be made of the increase in information in order to promote greater efficiency when it comes to the use of energy, materials and dematerialisation.
It is especially important to note the opportunities presented through learning from, and copying, nature. I do not have time to go into this now, but there are a number of examples where companies now make use of these principles, bring about perfectly clean solutions and, moreover, earn money from doing so.
Madam President, during the discussion in the committee, the Commission’s representative pointed out that sights are not set primarily upon a framework directive. I regret that. I am convinced that a framework directive is needed, and I hope that, under Commissioner Wallström’s leadership, the Commission will think the matter over and realise that it is important in the long term to bring about a horizontal, political framework that is of help in environmental work overall. 
Wallström,
     Madam President, ladies and gentlemen, Parliament’s draft report supports life-cycle thinking and provides sound guidance on how the Commission should further develop the Integrated Product Policy over the next few years. We have put a lot of effort into finding a better name that will tell the uninitiated something of what this is about, if only that it is an important task. I really do appreciate the efforts that have gone into this report, particularly the work done by the rapporteur, Mr Wijkman.
In the Commission communication, we emphasise that it was necessary to show how the Integrated Product Policy can operate in practice, and we have also said that we wish to use two methods to do this. Firstly, we wish to carry out a couple of pilot projects that bring together different actors to discuss, and preferably also to implement, measures that reduce these special products’ environmental effects. Secondly, we are in the process of drawing up a European inventory of those products that have the greatest potential for improving the environment. Such an inventory can help us direct our efforts at the most important products.
The report contains many interesting insights. Allow me to comment on a couple of important ones that show the link between the thematic strategies and this proposal, also mentioned by the rapporteur. I should also like to describe how I see the link between the Integrated Product Policy and other initiatives mentioned in the report, particularly the two thematic strategies: the strategy on the sustainable use of natural resources and the strategy for waste prevention and recycling.
My long-term vision for these three areas is really quite uncomplicated. I believe that the strategy on natural resources should include the general problems linked to the issue of how we are to break the link between economic growth and environmental damage. The strategy must state what is to be done to break this link and establish general objectives concerning the way in which natural resources are to be protected against over-exploitation and pollution. The Integrated Product Policy must then transform these resource-focused objectives – do not forget that natural resources provide us with minerals, food, water and clean air – into practical measures for reducing products’ and services’ effects upon the environment, at the same time as creating business opportunities.
It is of no consequence that we are beginning to prepare an Integrated Product Policy even before the resource strategy is ready. As we said in our proposal, we can do a lot right now. I also believe that the strategy on waste and recycling should be more clearly focused upon the environmental and market problems that arise in that part of the life-cycle. This does not mean ignoring the products’ whole life-cycles. On the contrary, the measures taken here must take account of environmental effects throughout the life-cycle, with the Integrated Product Policy being applied.
Nor, therefore, do I think that the Integrated Product Policy should embrace resource-based objectives. I think that these are better placed within the resource strategy. Nor do I believe that the Integrated Product Policy should advocate the use of certain materials, irrespective of whether they are bio-based materials, composite materials or other materials, because there is then a danger of ignoring the life-cycle dimension.
Secondly, I wish to emphasise that I do not believe that this is the right moment to prepare a framework directive on the Integrated Product Policy. Alongside the issue of what, realistically, can be part of such a directive – it should cover a very large number of tools and concepts, as well as its being possible to monitor compliance – I believe quite simply that it is too early to decide whether such a framework directive is necessary. However impatient we may be, I believe that we must wait a little and see how different actors apply the Integrated Product Policy in practice. That applies to industry, governments and consumers. If they do not make use of the opportunities it offers, we can consider a strategy with less of a voluntary basis, but I believe it is too early to draw conclusions about this at present.
In 2007, the Commission will review the two points I have mentioned, as well as the whole of the Integrated Product Policy. If it appears necessary, we shall make changes. For example, we might place greater emphasis upon services, recommend a framework directive or change the Integrated Product Policy as a result of the discussions concerning the thematic strategies. Moreover, I believe that the rapporteur’s contribution contains many important points which should definitely do more to direct our overall thinking as we face the future. 
Lange (PSE ).
   – Madam President, Commissioner Wallström, I strongly support Mr Wijkman. If we really want to enforce sustainable production, we must think in life cycles and not in individual products. That is why, Commissioner Wallström, we also need a structural framework for the building site. If you look at it now, what we have is a building site with the various building blocks scattered on the ground. We have EMAS, we have eco-labels, and for batteries we have decided on eco-labels again. Then we have limits, then for cars we have enhanced environment-friendly vehicles. We have the public procurement system, but nothing dovetails. Consequently, businessmen and consumers are of course not exactly clear how this integrated production is supposed to benefit them; that is why I can only strongly support Mr Wijkman. We need a framework for the building site so that these building blocks will fit together and a sensible structure will result. Only then, I believe, will we be able to persuade manufacturers to change their production methods and finally have environmentally friendly, sustainable production. 
President.
   The debate is closed.
The vote will take place tomorrow at 12 noon. 
President.
   The next item is a recommendation for second reading (A5-0234/2004) by Mrs Lambert, on behalf of the Committee on Employment and Social Affairs, on the common position adopted by the Council with a view to the adoption of a European Parliament and Council regulation on the coordination of social security systems. 
Lambert (Verts/ALE ),
   . Madam President, I regret the late hour for the debate on this topic which is actually going to affect the lives of many of our citizens, but the core group of the 'friends of Regulation 1408' are still here and recognise its importance.
This piece of work on the coordination – not harmonisation, as some of my colleagues would like us to believe – of social security systems has been lengthy. It started life in the previous Parliament and then changed to codecision and unanimity in Council in 1999. I trust that this simplification and modernisation of the much-amended regulation in the past will provide a useful and very constructive framework in a further enlarged European Union.
I wish to thank sincerely all the shadow rapporteurs and other Members for their serious work and ultimately constructive approach to this regulation. I also want to record my thanks to the Commission for its willingness to support our work with time, information and explanation. In Council, too, we have seen an increasing willingness to approach this reform with some spirit, which I know was not shared by all Members back in 1999 when I first met with representatives and Member States in Helsinki.
I would remind Members that Council informed the chairman and members of the Committee on Employment and Social Affairs – in writing in a letter dated 31 March and indeed verbally after that – of its agreement to the amendments here proposed to the common position and to the Council statement on taxation to be entered in the Council minutes should agreement be reached on the adoption of the regulation. I trust that tomorrow we will confirm the position of the Committee on Employment and Social Affairs at its last meeting.
As we know, the restrictions concerning this regulation have caused us some problems: the fact that tax cannot be tackled within it raises particular problems for some cross-border workers, especially as we see tax and social protection systems increasingly interlocking in some Member States.
The fact that we cannot build bridges between systems means that some people will still feel that free movement is not sufficiently supported and that will mean at least more work for the Committee on Petitions. However, mutual recognition, whether for family status or status as a person with disabilities, for example, will also continue to be an issue.
We also recognise in Parliament that we have not achieved the full flexibility we had hoped for with regard to access to benefits in kind for frontier workers and their families. While we realise that the fact that Member States must now explicitly register in Annex 3 if they do not wish to provide such a service demonstrates that this is a deviation from the norm, we view such refusals with concern. I am sure that this is an issue which will be taken up in the next Parliament when we see the Commission's proposals for the currently empty Annexes 2, 10 and 11, and for the implementing regulation. We trust that work will progress as speedily as possible so that the full revised proposal may come into force within the next two years.
However, we believe that the common position as amended in committee is a positive step forward. There has been no regression on the status quo: all persons covered by social security schemes are now included – not just paid workers. The positive steps taken for third country nationals – Mrs Oomen-Ruijten's report – are also there and were in the original Commission proposal. There is greater clarity concerning cross-border healthcare, and the European Court of Justice decisions on the criteria concerning medical necessity are there. The adoption of the assimilation of facts and events will be of benefit to frontier workers in particular and the number of derogations and exceptions has been reduced, despite our concern about the future development of the Annexes. There are clear criteria now concerning special non-contributory cash benefits. The principle of good administration has also been introduced.
This is a complex but necessary piece of work and it helps to answer the question of what the European Parliament does to benefit people. Despite certain reservations, which many of us in the House feel, I commend the common position, as amended, to the House and wish future rapporteurs on the subject the same degree of support and interest that has been offered to me as your rapporteur.
In conclusion, in a strange sort of way, I found this challenging and interesting experience quite fun at times. 
Dimas,
   . Madam President, ladies and gentlemen, I am most satisfied with the substantial progress which has been made on the present proposal, both in the Council and in Parliament, and with the fact that we are now coming to the final stage in its approval.
Achieving the objective of official approval by the Council and by Parliament before the 1 May is of the greatest importance, for numerous reasons. The most important is that it will send out a clear message to the citizens in both the present and in the new Member States, demonstrating that the European Union is both willing and able to set appropriate conditions for the real free movement of persons, the cornerstone of which is the coordination of social security systems.
I should like to congratulate the rapporteur, Mrs Lambert, on her truly excellent report on such a technically difficult issue as the coordination of social security systems. I should also like to thank the Committee on Employment and Social Affairs for its work.
As you know, the European Commission, in the amended proposal which it submitted last October, took account in full or in part of most of the amendments approved by Parliament at first reading. As regards the two amendments within the framework of the second reading, they clearly improve the quality of the text and the Commission can therefore accept them in full.
In addition, I can assure you that the Commission is also in a position to accept some of the remaining concerns and considerations expressed by certain members of the Committee on Employment and Social Affairs at second reading, within the framework of the proposal for a new executive regulation which the Commission will submit by the end of this year. I hope, as Mrs Lambert also said, that both the regulation and the three annexes will be approved by 2006.
The common position of the Council responds to the main objectives of the Commission proposal, which entail simplifying and improving the coordination of social security systems, for the benefit of European citizens moving around within the Union. The simplification and modernisation of the present regulation are the basic to the promotion of the mobility of labour in the Union. They are therefore closely connected with the general objective of competitiveness, of more and better jobs and of social cohesion. It is a fact that the present regulation provides protection in the social security sector for persons moving for any reason – personal or professional – from one Member State to another. It is therefore important to the overwhelming majority of European citizens.
I do not intend to enumerate all the improvements which the new rules will bring about compared with the present regulation, but we can focus our attention very briefly on three issues.
The new rules will apply to all citizens in the European Union covered by a Member State's social security system. The application of the coordination rules to all insured persons will satisfy the need for Regulation No 1408 to be brought into line with developments in the freedom of movement within the European Union, which is not just a right for workers, but is also a reality for all European citizens.
The new rules will strengthen the principle of equal treatment of nationals of the European Union by introducing a provision governing the cross-border recognition of facts and incidents. This provision is particularly important for cross-border workers.
The current regulation does not contain clear provisions on good administration. The new rules remedy this shortcoming. These rules in fact require increased cooperation and mutual assistance between the agencies in the Member States for the benefit of citizens. In addition, agencies will be required to reply within a reasonable period of time to all questions and to provide citizens with any information requested in order to exercise their rights.
Finally, I should like to say that this was indeed a long and difficult procedure which is coming to a successful end and I must thank you once again for bringing such a laborious task to a speedy conclusion in your capacity as joint legislator. 
Oomen-Ruijten (PPE-DE ).
    Madam President, I reluctantly agree with what is now on the table. I wanted more and better proposals on a number of scores. Nevertheless, I have noticed that a number of important achievements have been made, and I would thank Commissioner Dimas for his responses.
The regulation that is before us applies to all EU citizens. That is progress. I have noticed that it has not only been expanded in terms of scope, it has also been simplified. That too is progress. I gather that on paper, a clear distinction has been drawn between the exportability and non-exportability of cash benefits. Furthermore, I think that problems could well occur when the annexes are further detailed. I still regret the way in which, last time, Mrs Gillig and her Socialist colleagues refused even to bring this point to a vote in a democratic manner. I therefore fear that we will have problems when the annexes are fleshed out.
There are major improvements in this regulation for frontier workers. I can see the legal implications of what has now been established. For example, certain events in a Member State must be treated in the same way by the country of residence as similar events that have taken place on their own territory. That is progress. I have also noticed that the position of the family members of frontier workers has, in fact, been turned round and that they now have rights too. In an annex, however, those self-same rights are being nullified, so the progress made in the regulation is invalidated in the annex.
I have the feeling that we could have achieved more had we consulted all protocols, for example, in the field of tax levies and social premium levies. I know that the Council is against it, but we could have kept this all together. I can see that, in a number of respects, the Court of Justice’s judgments have been much more clearly incorporated into this regulation. I also gather that the Court’s health-care decrees have been assimilated effectively. I do have a problem, though, with the way in which outpatient care has been treated, in contrast with what the Court states. In addition, unemployment has been better highlighted, although to a lesser extent than I had expected. Third-country citizens are now included, but my report had already proposed that.
I have recommended that my group should vote in favour, on the condition that I am given every opportunity of introducing improvements where possible when the introductory regulation is fleshed out and also in the annexes. I would like to thank the rapporteur most warmly. 
Van den Burg (PSE ).
    Madam President, this simplification and modernisation has proved to be an arduous task. I should like to congratulate all those involved, particularly Parliament’s rapporteur, Mr Cornelissen and his team, the Irish Presidency and a number of previous presidencies on this achievement. My group considers this to be a sound basis, and also sets great store by the fact that it is ensured that the first step will be ready, as a matter of priority, by 1 May.
Needless to say, we are not completely ready, nor are we 100% satisfied. During the new legislative period too, with 25 Member States, it will still be of the utmost importance that we should cast a critical eye on the way in which the annexes are fleshed out, as well as the development of the implementing regulation. In this respect, we should not only examine the system, for which the basis has now been laid, but also the consequences of the changes which ensue from it, because some people can be seriously let down by this. We need to seek out solutions to these problems.
In addition, there are problems that cannot be solved in the regulation itself, some of which have already been mentioned, including the linking of taxes to social security systems or systems with which social security systems are complemented through collective labour agreements in private-sector industry. These are points mainly affecting frontier workers.
On various occasions, we in this House have called for a frontier work test, for changes in national rules and for a much better, structured cooperation between Member States where frontier work is a frequent occurrence. Accordingly, I should like to urge the Dutch Presidency at this stage to set to work in this respect in the next half year, as soon as the review is complete. The Netherlands, along with its neighbouring countries Germany and Belgium, should set an example for the other Member States in areas in which a great deal of bilateral negotiation is yet to take place, and the Netherlands should, if possible, also produce more ambitious cooperation agreements for the 25 Member States, because it is to be expected that labour migration will intensify.
Pressure of time prevents me from repeating all the points, but I should in any case like to suggest that cooperation between Parliament, Council and Commission should continue, on the same footing and in a constructive manner. This could quite possibly be in the context of a special working party, the name of which Mrs Lambert has already suggested: The Friends of 1408. 
Boogerd-Quaak (ELDR ).
    Madam President, first of all, I should like to congratulate the Commissioner on his new appointment. I hope that he shares our view that mobility in the Member States is more than necessary if we want to implement the Lisbon agenda. The Lambert report and Regulation 1408/71, on which the report is based, are, of course, important instruments in this respect.
I am extremely anxious about the wariness displayed by Member States with regard to the implications in terms of their own tax and social security systems. Here, I think, it is worth giving them a push in the right direction in future. That does not necessarily mean that you need to get Parliament’s backing, but mainly that you do need it from the Member States. I should nevertheless like to thank the rapporteur and all those involved. Tomorrow, my group will be voting in favour of the Lambert report.
I have to say that I have a great deal of admiration for Mrs Lambert. This regulation contains some valid points. The definition of frontier workers has been adopted; there are improvements in the field of pensions and also the families of frontier workers have not been overlooked. However, that is not all. For example, my country, the Netherlands, has yet again asked for an opt-out in certain sections, one being the medical treatment of frontier workers’ families. We have provided for this in the regulation, but the Netherlands has still asked for an opt-out. I see that as being unacceptable. I think that you should always be the first one to tell your country that it is acting unwisely. That, of course, also applies to other countries that are extremely anxious that, upon the EU’s imminent enlargement, a heavy burden will be placed on their social security.
Madam President, Commissioner, I hope that we can, together, realise the ideal of mobility among Member States being promoted, and that first-generation frontier workers will be compensated accordingly and do not always have to fight for their rights. I gather that the President considers I have exceeded my speaking time, but I should very much like to have a good long talk with the new Commissioner about how we could bring this subject into the open more effectively. In my view, this needs a permanent monitoring committee. 
Crowley (UEN ).
    Madam President, I should like to join my colleagues in congratulating Mrs Lambert on her tremendous work on what was a very difficult brief. One thing this highlights is that great results can be achieved when the EU institutions pool their collective intelligence.
The rapporteur has shown great tenacity in steering a very difficult course between many different viewpoints, and has arrived the best possible solution. I hope all Members will support this report tomorrow, along with the two amendments in it, as we need a majority vote.
In presenting this regulation to the public we should also highlight that this is probably the single most important piece of social legislation to come out of this Parliament and one that makes a real difference to people's lives in that it reflects the realities in which the modern-day European Union citizen is working. People are moving across borders to take up jobs, some people are retiring to other areas and an increasing number of people are working for periods in other Member States. We need to ensure that the rights of such people can be carried across borders.
Great credit is due to the Council for taking on board so many of the amendments Parliament sought to bring forward after first reading. To be parochial, I wish to thank the Irish Permanent Representation for their tremendous work. A number of those colleagues, who are sitting on the far side of this House, are a credit to Ireland and their to department for all the work they have done on this.
There are one or two points of concern. Some of them have been dealt with, but I would like to re-emphasise them. The issue of taxation is an issue for Member States alone. It is not an issue that we should link with other matters because that merely diverts attention away from where the real work can be done. I agree with the rapporteur that this report is not about harmonisation; it is about better coordination of the social security systems in Member States.
This regulation represents a huge change. Where previous regulations applied only to those who were economically active, this one applies to all benefit holders. It also constitutes an improvement as regards strengthening the equal treatment of all EU nationals.
There remains the issue of the 'empty Annexes'. We insist that the Commission and Council come forward in the near future with a proposal concerning the implemented regulation to ensure that the legitimate and genuine concerns raised by my colleagues – and in particular by Mrs Oomen-Ruijten – are taken on board and dealt with. Mrs Oomen-Ruijten brought forward issues that relate not to abstract numbers or abstract individuals, but to real people who encounter this kind of discrimination every day. It is now up to the Commission and Council, on the basis of the good faith we will show tomorrow, to keep their part of the bargain and bring forward a proposal in this regard. They must be as good as their word and ensure that those empty Annexes are filled. 
Gillig (PSE ).
    Madam President, Commissioner, like other Members, I am delighted this evening to see how much progress has been made on the task of modernising Regulation No 1408/71 on social security, which obviously improves the position of EU nationals who have to travel across borders, essentially in the context of their work. This is something that we can be pleased about, even though I do share the reservations which other Members have expressed.
This is a technical and complex issue. Dealing with it has required a great deal of time, and the task is not finished even now. We have just been reminded that the annexes are empty, and we still have some work ahead of us. However, I should like to thank, also on behalf of my colleague, first of all, the rapporteur, Mrs Lambert, for her perseverance and determination. I should also like to pay tribute to all those who have assisted with this work, whether in the Commission or in the Council.
Although, overall, we can feel satisfied, we ought nonetheless to admit that margins for improvement are both possible and necessary on this subject. I should like to concentrate on the issue of the tools at our disposal for dealing with this matter. We need to go beyond the reservations and attitudes of those Member States who seek to preserve prerogatives which, in this context, look very much like protectionism.
I hope that the coordination principle, which basically restricts and constrains us, and does not allow us to respond to the questions put by Members, will soon give way to real harmonisation on social protection, which is one of the essential components of the European social model.
I am convinced, Madam President, that the demand expressed by European citizens for a real social Europe, which we shall all be hearing a lot about in the near future, requires significant institutional change. The progress which has been made is to be welcomed. It is considerable, but it is still modest in comparison with what is at stake.
Finally, and above all, it must not be allowed to mask the existing disparity, which is to be condemned, between the very effective procedures which we have at our disposal with regard to economic matters, and the much weaker procedures which are used in the social sphere. Social convergence criteria are essential in order to deal correctly with the subject of social protection linked to mobility in Europe, a subject which, to the citizens of Europe, forms the basis of the credibility of European integration. 
Dimas,
   . Madam President, the Commission can take on board the concerns of some members of the Committee on Employment and Social Affairs in the framework of the proposal for the new implementing regulation. For both of the Commission's proposals, for the new implementing regulation and for the content of the three Annexes, the Parliament will play its role as a co-legislator. 
President.
   Thank you, Commissioner Dimas.
The debate is closed.
The vote will take place tomorrow at 12 noon.
(1) 

Ahern, Nuala (Verts/ALE ),
   . I would like to draw Parliament's attention to the situation of Mordechai Vanunu, who is being released from an Israeli jail this week after 18 years' imprisonment for revealing details of Israeli nuclear weapons programmes. He is now subject to emergency regulations, which constitutes a cruel and unusual punishment, even though he has served his sentence – incidentally for revealing details of the kind of weapons that the US is seeking to discover in Iraq.
The emergency regulations prevent him from leaving the country for six months or from being in contact with any foreign person – even by email or phone – otherwise he will be rearrested. He cannot talk to journalists and he is also barred from going within 100 metres of foreign embassies. This should be condemned by Parliament as contrary to the rule of law. 
Alyssandrakis (GUE/NGL ),
   .– The President of the European Parliament, in his interview in the Cypriot newspaper , appears to have commented on the Cypriot leaders by saying that he personally was disappointed by what he considered to be a failure in the fields of the imagination and courageous leadership which needed to be demonstrated at this time. He concluded by calling on the Cypriot people to seize the opportunity.
I consider it unacceptable and inadmissible that the President of the European Parliament, even at a personal level, should throw all his weight behind and add to the unbearable pressure, coercion and threats to which the Cypriot people are subject from the UN Secretary General and his entourage, from the US Government, from the European Commission and Council, from Turkey and from numerous others, including the political forces in Greece. His intervention is an insult and, if I may say so, is unseemly towards the political forces of Cyprus and the Cypriot people as a whole, who do not need lessons in good behaviour from the President of the European Parliament or anyone else.
In addition, his comments contradict what he says at the beginning of the interview about the choice of the communities of Cyprus in the two referenda being a choice by free and sovereign peoples. Do the President and others perhaps consider that the only free choice which the Cypriot people have in the referendum is to say 'yes'? 
Claeys (NI ),
   . Madam President, in the next couple of days, ceremonies will be held in various places around the world to commemorate the Turkish genocide against the Armenian people, which claimed the lives of more than one million people. Between 1915 and 1918, the Turkish army evacuated almost all Armenian villages within the Ottoman Empire. This involved the immediate execution of hundreds of thousands of citizens, while others died later, under horrendous circumstances, during hunger marches to Syria. This was the first genocide of the twentieth century.
To this day, however, Turkey refuses to acknowledge this genocide.
This is quite a serious blemish on a candidate Member State. It illustrates the way in which today’s Turkish Government views human rights.
I would remind you of the resolution adopted by our own Parliament in 1987, which clearly stipulates that Turkey has no claim to EU membership as long as it does not recognise the Armenian genocide. I would insist that this same resolution, which is still valid, be brought to the attention of the Commission and the Council. 
Enric Morera i Català (Verts/ALE )
   . Today is 19 April. It is the feast of Saint Vicent Ferrer, which is cause for much celebration in my home region of Valencia. It so happens that today is the day I take up office as a Member of this House representing the Valencian Nationalist Bloc. I should like to seize this opportunity to highlight a serious problem affecting the production of oranges and other citrus fruits in the region of Valencia.
The European Union has failed to adopt precautionary plant health measures to prevent possible attack by pests and diseases due to the import of citrus fruits from third countries such as Argentina or Brazil. This is a particularly serious situation. In the past, it led to the introduction of pests such as the citrus leaf miner. In the near future, it could have serious implications for the cultivation of citrus fruits in the region of Valencia, and across Europe. It is possible that the pv. could penetrate the territory of the Union. This pest causes canker in citrus fruits and the subsequent appearance of black patches on the skin of oranges.
The European Union must not evade its responsibility. It must introduce clauses ensuring plant health as a matter of urgency. Clauses of a different nature would be appropriate for other sectors, such as the textile sector. The aim should be to prevent the entry of pests and diseases into a sector that is so important to the economy of Valencia and therefore to the economy of Europe as a whole. 
Korakas (GUE/NGL ),
   . – Madam President, a few weeks after the murder of the Hamas leader Sheik Yassin, the Sharon Government murdered its new leader Abdel Ratissi, not only demonstrating that it does not wish the peace process to proceed and for there to be an independent Palestinian state, but also adding fuel to the fire and deliberately creating tension.
The ΕU, as is clear from its attitude to date, is basically following the US line, in that it has confined itself merely to expressions of protest about these murders and the attacks by Israel, while at the same time talking – through Mr Solana – about Israel's right to protect itself and examining Sharon's policy to clear the Gaza Strip. It is therefore making a victim out of the attacker.
We members of the Communist Party of Greece condemn the crimes by the Sharon Government and the hypocritical, complicit, policy of the ΕU. We express our active solidarity with the Palestinian people and call on the European Parliament to demand that the ΕU stop arming Israel and freeze the association agreement with it.
Madam President, again today, at your invitation, the European Parliament observed one minute's silence for the young Italian paramilitary executed in Iraq, but it has never requested the same for the thousands of victims of the invasions of Afghanistan, Iraq and, previously, of Yugoslavia. As the MEPs of the Communist Party of Greece have repeatedly requested this of you, could you tell us when you intend to do this? 
Mastorakis (PSE ),
   . –Madam President, I asked for the floor in order to inform the House that the Pakistani authorities have allowed the crew of the to return to their homes in Greece and the Philippines.
Following attempts over several months by the Greek Government, with the then Minister for Foreign Affairs Georgos Papandreos, which of course have continued up to today, and the provision of guarantees by it, following the reaction by the European Parliament, which passed a resolution on the subject, and following action by the troika and by Commissioner Chris Patten and the visit to Pakistan, the desired result has been achieved.
Having noted, therefore, how action by the institutions of the European Union and its Member States can be successful when properly coordinated, let us thank those responsible for handling this issue. 
Patakis (GUE/NGL ),
   .– Madam President, I should like to bring the House's attention to and ask for your immediate intervention in an extremely important issue. It concerns the survival of Greek farmers, who are literally on the brink of disaster.
The bitterly cold weather which hit Greece a few months ago caused extensive damage to farm assets (plants, land and so on) throughout the country. The farmers affected are having serious trouble surviving and will face bankruptcy unless specific measures are taken at once.
I am calling, Madam President, for your intervention in order to speed up the time-consuming Community procedures for approving the payment of compensation and financial aid to Greek farmers, as was the case with France, Italy and Malta, in order to prevent bankruptcy and enable the farmers affected to continue their productive activity. 
Rousseaux (ELDR ),
   – Alzheimer’s disease and other neuro-degenerative diseases are seriously affecting the population of Europe. According to current estimates, they affect 5% of those aged between 50 and 60, 8 to 10% of those between 60 and 70, and 10 to 20% of those between 70 and 80.
These diseases which affect the brain occupy third place in the tragic hit parade of diseases, after cardio-vascular diseases in first place and cancer in second place.
Alzheimer’s and related diseases affect millions of European citizens who, in time, become incapable of coping with their lives, not to mention their families who, when they assume responsibility for the care of such patients, have to reduce considerably or even give up their professional activities.
These diseases are having disastrous human, economic and social consequences for our society. In addition to the mental suffering caused by these diseases, there are almost no specialised care homes available, and those which do exist are often too expensive for the patient or his family, and are not covered by the social security system or by medical insurance. There is therefore an urgent need to develop, on all fronts, a real plan for the organised control of this scourge, which affects all of us either directly or indirectly.
The economic and social burden of diseases of the brain represents 35% of the cost of all diseases in Europe, and this figure is expected to rise in the next ten to twenty years. This finding must lead to a redefinition of the policies to be pursued regarding research, education, healthcare, prevention and social protection.
Since a third of the total cost of all diseases is attributable to diseases of the brain, the following measures are necessary: a substantial part of the funding for research into the life sciences should be devoted to the brain and its diseases, in particular Alzheimer’s disease, and the Seventh Framework Programme currently being negotiated should take this into account; a substantial share of spending on healthcare (prevention, diagnosis and treatment) should be devoted to these diseases; medical study programmes should be proportionately targeted against these diseases; a system of social protection should be set up, making it possible to give material support (care homes) and financial support to patients suffering from this disability and their families; and finally a European brain disease monitoring centre should be set up.
This scourge is so widespread, and its impact on our society so severe, that it is the duty of the various European institutions, the Commission, the European Parliament and the Council, and of the Member States, to take all appropriate measures within their power to combat, control and prevent these neuro-degenerative diseases such as Alzheimer’s, and to help those who suffer from them. 

The Commission position reflects the compromise agreed between the Council and the rapporteur in order to reach agreement at first reading.
The Commission can accept all compromise Amendments Nos 60 to 94, inclusive.
The Commission cannot accept Amendments Nos 1 to 59 inclusive. 

The Commission can accept the following amendments: 5, 8, 12, 13, 15, 16, 24, 25, 39, 42, 43, 46, 50, 51, 63, 64, 67, 68, 69, 70, 71, 72, 74, 75, 78, 86, 100, 102, 103, 104, 110, 112, 114, 117, 124, 126, 127, 128, 133, 134, 135, 136, 137, 139, 145, 147, 149, 174, 191, 199 and 201.
The Commission can accept the following amendments subject to rewording: 2, 3, 9, 11, 14, 18, 20, 26, 29, 34, 35, 37, 38, 53, 54, 55, 56, 57, 58, 60, 61, 66, 73, 79, 81, 87, 91, 92, 101, 105, 107, 108, 109, 118, 121, 140, 144, 146, 148, 150, 151, 156, 159, 162, 165, 168, 176, 179, 180, 184, 185, 186, 187, 192, 194, 197, 198 and 205.
The Commission can accept the following amendments in part, subject to rewording: 1, 6, 7, 23, 36, 40, 62, 65, 84, 95, 130, 131, 155, 164, 166, 167, 169, 172, 177, 188 and 195.
The Commission can accept the following amendments in part: 17, 27, 59, 142 and 158.
The Commission cannot accept the following amendments: 4, 10, 19, 21, 22, 28, 30, 31, 32, 33, 41, 44, 45, 47, 48, 49, 52, 76, 77, 80, 82, 83, 85, 88, 89, 90, 93, 94, 96, 97, 98, 99, 106, 111, 113, 115, 116, 119, 120, 122, 123, 125, 129, 132, 138, 141, 143, 152, 153, 154, 157, 160, 161, 163, 170, 171, 173, 175, 178, 181, 182, 183, 189, 190, 193, 196, 200, 202, 203, 204 or 206. 

Ghilardotti report 
The Commission can accept the following amendments: 1, 5, 10, 19, 23, 41, 59, 60, 62, 68, 71, 88, 90, 96, 104, 107, 108, 109, 111 and 112 (total: 20).
The Commission can accept the following amendments in part or subject to changes: 2, 4, 6, 7, 8, 9, 13, 14, 17, 21, 24, 25, 27, 28, 29, 31, 33, 34, 37, 38, 39, 40, 42, 44, 45, 47, 61, 65, 67, 69, 72, 73, 76, 80, 84, 85, 87, 89, 92, 98, 99, 100, 103, 105 and 106 (total: 45).
The Commission cannot accept the following amendments: 3, 11, 12, 15, 16, 18, 20, 22, 26, 30, 32, 35, 36, 43, 46, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 63, 64, 66, 70, 74, 75, 77, 78, 79, 81, 82, 83, 86, 91, 93, 94, 95, 97, 101, 102 or 110 (Total: 47). 

The Commission can accept the following amendments: 1, 5, 6, 8, 9 (only if 12 is also adopted), 12, 16, 17, 18, 19, 20, 22, 24, 28, 29, 30, 32, 33, 34, 37, 39, 40, 41, 42, 44, 45, 50, 51, 52, 53, 54, 57, 58, 60, 61, 62, 63, 64, 66, 76, 77 and 78.
The Commission can accept the following amendments subject to rewording: 2, 3, 4, 43, 74 and 75.
The Commission can accept the following amendments as part of the compromise package: 7, 15, 23 (if reworded), 25, 36, 38, 46, 47, 48, 59 and 65.
The Commission cannot accept the following amendments: 10, 11, 14, 21, 26, 27, 31, 35, 49, 55, 56, 67, 68, 69, 70, 71, 72 or 73. 

The Commission can accept the following amendments with redrafting: 5, 10, 13, 16, 23, 24, 25, 26 and 35.
The Commission can accept the following amendments in principle: 6, 7, 8, 9 and 73.
The Commission can accept the following amendments in part: 17, 20, 47, 48, 59, 60, 63, 65, 66 and 69.
The Commission cannot accept the following amendments: 1, 2, 3, 4, 11, 12, 14, 15, 18, 19, 21, 22, 27-34, 36-46, 42-46, 49-58, 61-62, 64, 67-68, 70-72 and 74-81. 

The Commission can accept the compromise package consisting of the amendments in bloc 1 (amendments 11, 12 and 18 to 46).
The Commission cannot accept the amendments in bloc 2 as a whole.
From the amendments in bloc 2, the Commission cannot accept amendments 2, 3, 5, 10, 11, 12, 13 or 18. Amendment No 6 is acceptable in principle. The Commission cannot accept amendments 1, 7, 9, 15 or 16. Amendments Nos 4, 8, 14 and 17 are acceptable in part. 

The Commission can accept the following amendments: 4, 5, 11, 12, 13, 14, 21, 24, 31, 46, 47, 50, 51, 52, 56, 57, 58, 59, 60, 61, 62, 64, 78, 79, 80 and 81 – 26 amendments altogether.
Amendments Nos 10, 16, 17, 20, 22, 23, 27, 28, 29, 35, 40, 42, 43, 44, 48 and 53 can be accepted in principle and/or in part – 16 amendments altogether.
The Commission cannot accept the following amendments: 1, 2, 3, 6, 7, 8, 9, 15, 18, 19, 25, 26, 30, 32, 33, 34, 36, 37, 38, 39, 41, 45, 49, 54, 55, 63, 65, 66, 67, 68, 69, 70, 71, 72, 73, 74, 75, 76, 77 and 82 – 40 amendments altogether. 
