Preparation of the Competitiveness Council of Ministers, Brussels, 25 September 2006 (full version)

September 25, 2006

Brussels, 22nd September 2006

The EU Competitiveness Council will meet in Brussels on Monday 25 September under the chairmanship of Mauri Pekkarinen, Finnish Minister of Trade and Industry. The European Commission will be represented by Vice President Günter Verheugen, responsible for Enterprise and Industry, Charlie McCreevy, Commissioner for the Internal Market and Services, Markos Kyprianou, Commissioner for Health and Consumer Protection Janez Potočnik, Commissioner for Science and Research and Neelie Kroes, Commissioner for Competition Policy.

Innovation Policy and Competitiveness

At their 2006 Spring Summit meeting, European Heads of State and Government called on the Commission to present “a broad based innovation strategy for Europe that translates investments in knowledge into products and services. On 13 September, the European Commission tabled a 10 point programme for action at national and European levels to foster innovation as a main asset of the EU economy. Vice President Verheugen will present the innovation strategy to Ministers. ( IP/06/1181 ; MEMO /06/325

This will form the basis for the discussion by European leaders at the informal Summit due to take place in Lahti, Finland on 20 October 2006. The programme points the way forward to accompany industry-led innovation with public policies at all levels as a core element of the renewed Lisbon strategy for growth and jobs. The Commission seeks to develop the concept of "lead markets" where public authorities, facilitate industry-led innovation by creating conditions for a successful market uptake of innovative products and services in a focussed way. The Commission's response to this call is based on the following ten high priority actions:

Establish innovation–friendly education systems

- Establishment of a European institute of Technology

- Work towards a single labour market for Researchers

- Strengthen research-industry links

- Foster regional innovation through the new cohesion policy programmes

- Reform R&D and innovation State aid rules and provide better guidance for R&D tax incentives

- Enhance intellectual property rights protection (IPR),

- Digital products and services - initiative on copyright levies

- Develop a strategy for innovation friendly "lead-markets"

- Stimulate innovation through procurement

The Commission has called on Member States to make the structural reforms necessary to deliver the results required and underlined that Europe does not need new commitments from Member States but political leadership and decisive action

Proposal to repeal the Directives laying down the rules on nominal quantities for pre-packed products - Public debate

Vice President Verheugen will take part in a public debate in Council on the Commission's proposal to repeal the Directives laying down the rules on nominal quantities for pre-packed products. The proposal before the Council is a proposal to abolish existing rules on pack sizes for all pre-packaged products. It is a technical proposal but it is a part of the major policy initiative.

The regulatory framework in which businesses operate is a key factor of their competitiveness, growth and employment performance. A key objective of the European Union's Enterprise policy is thus to ensure that the regulatory environment is simple and of high quality. "Better regulation” is a centrepiece of the European Commission’s “Partnership for Growth and Jobs” which was launched in Spring 2005.

Since then, it has moved up the political agenda. Impact assessments have to be carried out for all new important legislative proposals of the Commission and the writing is on the wall for all unnecessary or obsolete pending and even adopted proposals.

The pre-packaging proposal is a demonstration of simplification and better regulation in practice and is good for an open EU market based on competitiveness and growth.

Development of the Single Market Policy

Commissioner McCreevy will discuss with Ministers the development of Single Market policy. Commissioner McCreevy will present the Commission's ongoing Single Market Review, which will also cover the recent public consultation on the future of the Single Market ( IP/06/1234 ) and the results of the latest Internal Market Scoreboard ( IP/06/1008 ). The subsequent debate will be structured around the following questions, as proposed by the Presidency:

- What kind of internal market policy could best address the challenges of the future and respond to the increasingly global environment facing Europe?

- What would be the best way to ensure political legitimacy/acceptance of the internal market project in the enlarged Union?

- There is a need for efficient functioning of the internal market bringing tangible benefits to citizens and businesses. What could be done to improve the efficiency?

- Correct implementation and enforcement of the internal market rules is crucial.

What instruments - existing or new ones - could be used to improve the enforcement of the common rules

Programme of action in the field of Consumer Policy

The Council is expected to reach a political agreement on the Commission's modified proposal for a Programme of Action in the field of consumer policy (2007-2013). The proposal was adopted by the Commission on 24 May 2006 as part of the Financial Perspective package, together with the public health proposal. The programme is the means by which the EU can implement its aim to “contribute to protecting the health, safety and economic interests of consumers, and promoting their right to information and education”. It enables the EU to support consumer organisations, to financially support training actions or other projects in line with the programme's objectives and to put in place measures aimed at facilitating the enforcement of EU consumer legislation, The programme for 2007-2013 has two main objectives: to ensure high levels of consumer protection, through effective representation of consumer interests, and to ensure that consumer protection rules are effectively applied, i.e. through enforcement, cooperation, information, education and redress.

State aid for Research, Development and Innovation

At the invitation of the Finnish Presidency, Competition Commissioner Kroes will brief informally Ministers over lunch concerning preparations for the adoption of a new state aid framework for Research, Development and Innovation. This new framework was announced in the September 2005 Communication on State Aid for Innovation (see IP/05/1169 ) and forms part of the Commission’s new strategy to encourage Member States to focus state aid on projects liable to increase the competitiveness of the European economy, as laid out in the State Aid Action Plan (see IP/05/680 and MEMO/05/195 ). The Commission published a second draft of the state aid framework for Research, Development and Innovation for Member States and other interested parties to comment until 13th October. After receiving and analysing the comments, the Commission intends to adopt the new framework before the end of 2006. For further information see:

Block Exemption on Liner Conferences

The Council is due to approve without discussion the Commission’s proposal to abolish the exemption from the EC Treaty’s ban on restrictive business practices for liner conferences in routes to and from the European Union (see IP/05/1586 ). The current block exemption, established by Council Regulation 4056/86 allows carriers to fix prices and regulate capacity jointly. This reform will enhance the competitiveness of EU exports and is likely to result in lower transport prices. To ensure that the new regime fosters competitive markets, the Commission intends to issue Guidelines on the application of the competition rules to maritime transport before the end of the transitional period. The Council is also due to empower the Commission to apply competition rules to ‘cabotage’ and tramp shipping, thereby extending the scope of the competition implementing rules (Regulation 1/2003).

Any Other Business

(a) 7th Research Framework Programme

The Council will adopt its Common Position on the Seventh Framework Programme. This institutional step formalises the political agreement reached in July 2006. The Finnish presidency will give an update on the state of play regarding the FP7 legislative package.

(b) Implementation report on retaining and attracting researchers to the European Research Area

The Council will take note of an implementation report by the Commission on the mobility of researchers and career development in the European Research Area, focusing on 2005. In particular the report highlights the work done on a European Charter for Researchers and a Code of Conduct for the Recruitment of Researchers, the consolidation of the European network of mobility centres, the on-going development of the European Researchers’ Mobility Portal on the internet and last year’s Researchers in Europe Initiative.

(c) 6th Euro-Mediterranean Ministerial Conference on Industry 21/22 September 2006

Information from the Presidency

(e) Implementation of the Consumer Protection co-operation regulation

Commissioner Kyprianou will inform the Member States about the implementation of the Consumer Protection Co-Operation regulation. Regulation 2006/2004 establishes a network of public authorities responsible for the enforcement of consumer protection law partially harmonises their investigation and enforcement powers and provides mutual assistance arrangements between them. The provisions on mutual assistance will apply from the end of 2006 and other provisions (such as the creation of the Regulatory Committee, the Community cooperation activities and international agreements) apply already since the end of 2005.

International Agreement establishing the ITER fusion energy research project

The Council is expected to mandate the Commission to sign the draft agreement setting up the international fusion energy research project ITER. The draft was initialled on behalf of the EU by European Science and Research Commissioner Janez Potocnik at a ceremony in Brussels in May 2006 and a final signature by all seven international parties is expected later this year.

Item source: MEMO/06/343 Date: 22/09/2006

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