26-27.XI.2003

C/03/337

Brussels, 26-27 November 2003

15141/03 (Presse 337)

2547th Council meeting
- Competitiveness -
Internal Market, Industry and Research
Brussels, 26-27 November 2003

Presidents: / Mr Rocco BUTTIGLIONE, Minister for Community Policies,
Mr Antonio MARZANO, Minister for Production Activities and
Mrs Letizia MORATTI, Minister for Education, the Universities and Research
of the ItalianRepublic

CONTENTS[1]

PARTICIPANTS...... 3

ITEMS DEBATED

ENHANCING competitiveness and growth - Council conclusions...... 6

European Space Policy...... 7

STEM CELL RESEARCH...... 7

ITER construction and operation...... 8

Takeover bids...... 8

Community Patent...... 9

The EC Merger Regulation...... 10

CONTRIBUTION OF INDUSTRIAL POLICY TO EUROPEAN COMPETITIVENESS - Council conclusions 11

Community trade mark...... 17

Insurance against civil liability in respect of the use of motor vehicles - public deliberation.....18

Equal acess to and participation of women and men in the knowledge society for growth and innovation - Council Resolution 19

Recognition of professional qualifications...... 22

OTHER BUSINESS...... 22

–REGISTRATION, EVALUATION, AUTHORISATION AND RESTRICTION OF CHEMICALS (REACH) 22

–BIOTECHNOLOGY AND LIFE SCIENCES...... 23

–BETTER LAWMAKING...... 23

–MACHINERY AND AMENDING DIRECTIVE95/16/EC...... 23

–SUSTAINABLE TOURISM IN EUROPE...... 23

PARTICIPANTS

The Governments of the MemberStates and the European Commission were represented as follows:

Belgium:
Mr Serge KUBLA / Vice-Minister-President and Minister for Economic Affairs, SMEs, Research and New Technologies (Walloon Region)
Ms Fientje MOERMAN / Minister for Economic Affairs, Energy, Foreign Trade and Scientific Policy
Denmark:
Mr Bendt BENDTSEN / Minister for Economic Affairs, Trade and Industry
Mr Helge SANDER / Minister for Science, Technology and Development
Germany:
Mr Georg Wilhelm ADAMOWITSCH / State Secretary, Federal Ministry of Economic Affairs and Labour
Mr Wolf-Michael CATENHUSEN / State Secretary, Federal Ministry of Research
Greece:
Mr Apostolos TSOCHATZOPOULOS / Minister for Development
Mr Dimitrios DENIOSOS / General Secretary in charge of Research
Spain:
Mr Juan José COSTA CLIMENT / Minister for Science and Technology
Mr. Pedro MORENES EULATE / State Secretary for Science and Technology Policy
Mr Ramón DE MIGUEL / State Secretary for European Affairs
France:
Ms Claudie-HAIGNERÉ / Minister attached to the Minister for Youth, Education and Research, with responsibility for Research and New Technology
Ms Nicole FONTAINE / Minister attached to the Ministry for Economic Affairs, Finance and Industry, with responsibility for Industry
Ireland:
Ms Mary HARNEY / Tánaiste (Deputy Prime Minister) and Minister for Enterprise, Trade and Employment
Italy:
Mr Antonio MARZANO / Minister for Production Activities
Mrs Letizia MORATTI / Minister for Education, the Universities and Research
Mr Rocco BUTIGLIONE / Minister for Community Policies
Mr Guido POSSA / Deputy Minister for Education, the Universities and Research
Luxembourg:
Ms Erna HENNICOT-SCHOEPGES / Minister for Culture, Higher Education and Research, Minister for Public Works
Mr Henri GRETHEN / Minister for Economic Affairs, Minister for Transport
Netherlands:
Mr Laurens Jan BRINKHORST / Minister for Economic Affairs
Austria:
Mr Martin BARTENSTEIN / Federal Minister for Economic Affairs and Labour
Portugal:
Ms Maria da Graça CARVALHO / Minister for Science and Higher Education
Ms Rosário VENTURA / State Secretary for Industry, Trade and Services
Finland:
Mr Kare HALONEN / Deputy Permanent Representative
Sweden:
Mr Thomas ÖSTROS / Minister for Education
Mr Leif PAGROTSKI / Minister for Industry, Employment and Communications
United Kingdom:
Ms Jacqui SMITH / Minister of State for Industry and the Regions and Deputy Minister of Women and Equality
Ms Patricia HEWITT / Secretary of State for Trade and Industry and Minister for Women and Equality
* * *
Commission:
Mr Frederik BOLKESTEIN / Member
Mr Philippe BUSQUIN / Member
Mr Erkki LIIKANEN / Member
Mr Mario MONTI / Member

The Governments of the Acceding States were represented as follows:

CzechRepublic:
Mr Miroslav SOMOL / Deputy Minister, Ministry of Industry and Trade
Mr Ludek STAVINOHA / Deputy Permanent Representative
Estonia:
Mr Margus RAHUOJA / Deputy Permanent Representative
Cyprus:
Mr Markos KYPRIANOU / Minister for Finance
Latvia:
Mr Juris LUJĀNS / Minister for Economic Affairs
Mr Eduard STIPRAIS / Deputy Permanent Representative
Lithuania:
Mr Rimantas VAITKUS / Deputy Minister for Education and Science
Mr Nerijus EIDUKEVIČIUS / Deputy Minister for the Economy
Hungary:
Mr Péter GOTTFRIED / State Secretary for Integration and External Economic Relations
Mr Egon DIENES-OEHM / Deputy Permanent Representative
Malta:
Mr Edwin VASSALLO / Parliamentary Secretary, Ministry of Finance and Economic Affairs
Poland:
Ms Danuta HÜBNER / Minister for European Affairs
Mr Michael KLEIBER / Minister for Science
Slovakia:
Mr Martin FRONC / Minister for Education
Mr Juraj NOCIAR / Deputy Permanent Representative
Slovenia:
Ms Tea PETRIN / Minister for Economic Affairs
Mr Zoran STANČIČ / State Secretary, Ministry of Education, Science and Sport

ITEMS DEBATED

ENHANCING competitiveness and growth - Council conclusions

The Council adopted the following conclusions:

"The Council

  1. RECALLING the conclusions of the European Council meeting held on 16 and 17 October 2003 which highlighted, within the Growth Initiative, the fundamental role of innovation and research and development for the purposes of Europe's economic and social growth in pursuit of the Lisbon objectives;
  1. NOTING that the European Council meeting on 16 and 17 October 2003 invited the relevant formations of the Council, with a view to the European Council meeting on 12 and 13 December 2003, to make their own contribution to the establishment of the Quick-Start Programme identifying a list of projects in an enlarged Union based on transparent criteria, along with assessments of their significance for the integration of the internal market in the enlarged Europe, their economic and financial viability, their impact on growth and the leveraging effect on private capital;
  1. EMPHASISING that it considers projects in the sector of innovation and research to be identified for the Quick-Start Programme should:
  • meet the criteria of complementarity and synergy with the thematic priorities of the Sixth Framework Programme, while actively pursuing its implementation, and ensuring full consistency of the objectives and implementing instruments for European action in the R&D sector;
  • maintain a character of excellence in the context of realising the European Research Area;
  • contribute to Europe's economic and social growth as outlined by the Lisbon Process;
  1. RECALLING the preliminary exchange of views which took place at the Competitiveness Council held on 10 November 2003, on the basis of a number of considerations tabled by the Presidency regarding possible priority areas and quick-start projects for research and development;
  1. WELCOMES the communication from the Commission on a European Initiative for Growth-Investing in Networks and Knowledge for Growth and Jobs[2], and in particular, the criteria to be used in identifying projects for the quick-start programme, namely the maturity of the project, its transfrontier dimension, its impact on growth and innovation in an enlarged European Union and its benefits for the environment;
  1. CONSIDERS that the areas proposed in the Commission's communication constitute a first list of R&D priorities; NOTES that the list of priorities is non-exhaustive and may be supplemented as and when necessary."

European Space Policy

The Council took note of the presentation by Commissioner Philippe Busquin on the Commission's White Paper on implementing the European Space Policy. It instructed the competent preparatory bodies of the Council to proceed with a detailed examination of the Paper with a view to enabling the Competitiveness Council to bring the work forward rapidly.

In this White Paper, the Commission proposes the implementation of an extended European Space Policy to support the achievement of the European Union's policy goals. In particular, it is proposed to exploit the special benefits space technologies can deliver in support of the Union’s policies and objectives: faster economic growth, job creation and industrial competitiveness, enlargement and cohesion, sustainable development and security and defence.

It is recalled that a number of Council resolutions and conclusions between 1998 and 2001 all pointed in the direction of developing a European space strategy. This culminated in the adoption by the Council in December 2001 of a Resolution entitled "Towards a European Space Strategy", inter alia inviting the Commission to present a proposal for a negotiating mandate for a framework agreement between the European Community and the European Space Agency (ESA). Following negotiations conducted by the Commission on behalf of the Community with the ESA, a framework Agreement was signed on 25 November 2003 between the two Parties. This Agreement will have an initial duration of four years and will form an important basis for initially implementing the European space policy.

STEM CELL RESEARCH

The Council heard the presentation by Commissioner Philippe Busquin of the Commission's revised proposal in the light of the opinion of the European Parliament, regarding the main conditions for the use of stem cells procured from human embryos for research activities funded under the Sixth Framework Programme specific programme "Integrating and strengthening the European Research Area".

After discussing this issue informally over lunch, the Council decided to meet again on 3 December with a view to taking a decision.

The Commission's proposal aims at establishing implementing provisions concerning research activities involving human embryos and human embryonic stem cells eligible for Community funding as envisaged by the Council/Commission statement at the time of the adoption of the specific programme "Integrating and strengthening the European research area" adopted on 30 September 2002.

ITER construction and operation

The Council decided unanimously to amend the Commission's negotiating directives on the establishment of an international framework concerning the International Thermonuclear Experimental Reactor (ITER) authorising the Commission to put forward Cadarache (France) as the European candidate site. The Council also decided unanimously that the ITER European legal entity will be located in Spain and that one of the European Directors of the project will be Spanish.

The negotiations on ITER are currently being undertaken by Canada, China, the European Union, Japan, the Republic of Korea, Russia and the United States.

The next meeting of the Parties to the envisaged ITER agreement will be held on 4 December. Three candidates for hosting this site: Cadarache (France), Clarington (Canada) and Rokkasho (Japan) have been put forward.

Takeover bids

The Council reached unanimous agreement, with the abstention of the Spanish delegation, on a general approach, pending the European Parliament's first reading opinion, on a draft Directive on takeover bids, based on a compromise text presented by the Italian Presidency. The Commission stated that it was not in a position to support the text. The proposal, as modified by the Council, will form the basis of a possible agreement with the European Parliament at first reading.

Given the existing differences between legal systems in the Member States, the Council decided to limit this Directive to a framework of certain common principles and a number of general requirements which Member States will have to respect through detailed implementing rules.

The main changes in relation to the Commission's proposal concern the introduction of optional arrangements for the application of provisions concerning defensive measures by the "offeree" company and obligations of its board as well as the so-called breakthrough provisions (Articles 9 and 11).

It is recalled that in 1989 the Commission presented a first proposal concerning takeovers and other general bids, but decided to revise its proposal on the basis of consultations with the MemberStates as of June1993.

Then, in 1996 the Commission presented to the Council and to the European Parliament a new proposal. This proposal for a "framework" directive was drawn up in the light of consultations with the MemberStates, setting out general principles but not aiming at a full harmonisation.

After agreement between the European Parliament and the Council within the Conciliation Committee in June2001 on this proposal, the European Parliament rejected the compromise text.

Following this failure to adopt the proposed Directive, the Commission appointed a group of experts (the Winter Group) for the purpose of providing a basis for a new proposal.

The Commission adopted a new proposal on October 2002 that met the concerns of the European Parliament without compromising the basic principles approved unanimously in the Council's common position of 19June2000.

It will be recalled that the Lisbon European Council placed the takeover Directive, which forms part of the Financial Services Action Plan, among the priorities for the integration of European financial markets by 2005.

Community Patent

The Council examined outstanding questions on the draft Regulation on the Community Patent. Broad agreement was reached on a compromise text presented by the Presidency. However, complete agreement could not be reached at this Council meeting since the question of the period for the filing of translations of the patent claims could not be solved, as one delegation was unable to agree to the compromise proposed by the Presidency.

Renewed efforts will be made, still under the Italian Presidency, to reach an agreement on the draft Regulation as well as on proposals for amendments to the European Patent Convention.

The aim of the draft Regulation on the Community Patent is to provide for the creation of a single industrial property right for the whole Community, to be granted by the European Patent Office (EPO) in Munich. It aimed at eliminating the distortions of competition created by the territorial nature of national protection rights and ensuring the free movement of goods protected by patents.

Alongside this draft Regulation, amendments will have to be made to the European Patent Convention to enable the European Patent Office to play its part in the Community patent system. There is also a need to introduce jurisdictional arrangements in the draft Regulation and to create, through the future Commission proposals, a judicial panel, "the Community Patent Court", to decide on legal disputes in respect of Community patents.

Objectives of the Community patent system

The European Council has emphasised on several occasions that the Community patent must be an efficient and flexible instrument – obtainable by businesses at an affordable cost – which complies with the principles of legal certainty and non-discrimination between the Member States.

Agreement on a common political approach was reached on the proposal in the Council in March 2003. On the basis of this agreement, the Council was called upon to address a certain number of issues relating to the specific provisions in the draft Regulation.

In the EU, patent protection for innovation is currently provided by two systems – national patent systems and the European patent system –neither of which is based on a Community legal instrument. The 1973 Munich Convention established a European Patent Organisation, laying down a single procedure for the granting of patents, which, once granted, become national patents subject to the national rules of the Contracting States. All of the EU's Member States are members of the Convention, which is governed by international law.

The proposal to create a Community patent system stems from the Commission's 1996 action plan for innovation and subsequent Green Paper on patents. The objective is to enable companies to transform their technological and scientific know–how into industrial and commercial success, thus stimulating private sector investment in research and development. Such investment is currently at a very low level as compared with the United States and Japan.

Companies would remain free to choose the type of protection best suited to their needs. Given that the EPO would be responsible for examining patent applications and granting Community patents, the new system would require the Community's accession to the Munich Convention as well as a revision of that Convention.

The EC Merger Regulation

The Council reached unanimous political agreement on the draft Regulation on the control of concentrations between undertakings (the so called "EC Merger Regulation"). After finalisation of the text, the Council will formally adopt this legislative proposal at one of its forthcoming meetings, thus fulfilling the request by the European Council of 20 and 21 March 2003 to take forward this reform of the merger regime before the 2004 Spring European Council.

The proposal aimed at recasting Council Regulation No 4064/89 into legislation designed to meet the challenges of a more integrated market and the future enlargement of the European Union. This draft Regulation confines itself to the minimum required in order to achieve the objective of ensuring that competition in the common market is not distorted, in accordance with the principle of an open market economy with free competition.

The main change made to the Commission's proposal is the new test for the appraisal of concentrations which provides that a concentration will be declared incompatible with the common market if it would significantly impede effective competition, in the common market or in a substantial part of it, in particular as a result of the creation or strengthening of a dominant position.

The current Merger Regulation was adopted in December 1989 and came into force in September 1990, removing the need to seek clearance for mergers and acquisitions exceeding certain turnover thresholds in a myriad of national regulatory regimes.

The Merger Regulation was last amended in 1997, when a second set of lower turnover thresholds, designed to address the problem of "multiple filings" to national competition authorities was introduced.

CONTRIBUTION OF INDUSTRIAL POLICY TO EUROPEAN COMPETITIVENESS - Council conclusions

The Council adopted the following conclusions:

"THE COUNCIL OF THE EUROPEAN UNION

  1. IN RELATION TO HORIZONTAL ISSUES
  1. RECALLING:
  • the Commission communication on "an integrated approach to competitiveness"[3];
  • the contents of the "Competitiveness report (2003)"[4], the "Enterprise scoreboard (2003)"[5], the "Innovation scoreboard (2003)"[6] as well as the "State aids scoreboard (2003)"[7] drawn up by the Commission;
  1. RECOGNISING that:
  • a fully integrated approach to enhance competitiveness requires coherence, synergies and complementarities between policies;
  • industrial competitiveness is one of the key areas where such an integrated approach is required;
  • both the European Union and the MemberStates have active roles to play in successfully developing this approach;
  • it is essential to continue to develop, where necessary, the means for coordinating activities relevant to industrial policy undertaken by the Member States and by the European Union to meet the objectives set by the Lisbon strategy;
  • all policies related to enhancing competitiveness should be based on a careful analysis of the relevant aspects, as well as on an equilibrium between the economic, social and environmental pillars of sustainable development;
  • sectorial analysis should contribute to sharpening horizontal policies and to addressing the needs of industrial sectors in the European Union, including those with a high growth potential;
  • Community and national policies, whilst pursuing their primary objectives, should also contribute to improving the framework conditions for European competitiveness and to creating a favourable environment for enterprise;
  • open and transparent consultation of stakeholders and ongoing assessment of the impact on EU enterprises of all major legislative and other proposals are needed; while the Commission's proposal on chemicals is a first case for implementing this approach, the Commission's annual work programme will provide an important basis for systematic impact assessment by helping to identify other proposals likely to have a significant impact on competitiveness;
  • social dialogue constitutes an important element for a successful industrial policy;
  • it is necessary to improve the European industrial framework with a view to avoiding deindustrialisation, and that further analysis is needed in this respect;

  1. WELCOMES the report by the Commission services on competitiveness, as well as the enterprise, innovation and state aids scoreboards, which are important instruments for developing a systematic analysis of the state of competitiveness of the EU economy;
  1. TAKES NOTE of the findings of these reports and, as a result, UNDERLINES in particularthat:
  • prospects for raising the standard of living in the European Union are directly related to enhancing the competitiveness of EU enterprises across all sectors: additional actions to increase both employment and labour productivity are needed to meet the objectives of the Lisbon strategy;
  • positive developments in terms of innovation, ICT investment, internet penetration and commercial use, as well as e-government need to be complemented by organisational innovation, so as to exploit their full potential;
  • delays in achieving the Lisbon objectives need to be addressed both by structural reforms and by appropriately stimulating entrepreneurship, competitive conditions, innovation and providing venture capital and guarantee mechanisms at EU, national and regional levels;
  • education, life long learning, the qualification level of the workforce and the quality of work output are important factors for European industrial competitiveness;
  • for growth prospects to be strengthened, and thus to create more employment, the EU and Member States must encourage high productivity and competitiveness, as well as those aimed at facilitating structural change and industrial modernisation, bearing in mind the challenges and opportunities resulting from enlargement.

In response to the foregoing considerations: