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European Monetary System
credit guarantee
credit institution
financial solvency
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text: *^ Jt W J». I COMMISSION OF THE EUROPEAN COMMUNITIES * '• X "* W Brussels,30. 05. 1996 COM(%) 193 final 96/0126 (COD) Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE ON SETTLEMENT FINALITY AND COLLATERAL SECURITY (presented by the Commission) EXPLANATORY MEMORANDUM I. Background The present proposal for a directive is the result of a process which can be summarised as follows: The Lamfalussy Report of 19901 highlighted the important systemic risks inherent in payment systems which operate on the basis of one or more legal types of payment netting1. The Commission's attention was drawn to these matters by one of its advisory committees on payment systems, the Payment Systems Technical Development Group. In its March 1992 working document3, the Commission noted that certain features of the law in a number of Member States, together with the differences between Member States' laws relating to payment systems in general, were a source of uncertainties and risks. This view was endorsed by the Committee of Governors of the central banks of the EC4. Work began on these issues in a group of government legal experts and central bank representatives, chaired by the Commission, early in 1993. The first phase of the work has consisted of establishing an inventory of the legal situation in the areas of payment netting and settlement finality in all Member States, which has led to a more precise identification of these problems. An extensive study5, ordered by the Commission and delivered in February 1994, supported these preliminary conclusions. A first consultation hearing with the European Credit Sector Industry was held in the spring of 1994. In a second phase (since 1994) different solutions have been discussed and examined within the group of government experts. They are listed under point II. 3. A second consultation hearing with the European Credit Sector Industry was held in October 1995, which confirmed the overall validity of the approach. In the light of this process, the Commission has reached operational conclusions, in particular as regards the questions pertaining to. settlement finality and collateral security. It therefore considers that a directive should be proposed. No operational conclusions have been reached relating to securities settlement systems. These issues remain, however, under consideration within the Commission. It may be necessary to make a further proposal covering these issues in the future. Overall assessment The Commission Strategic Programme for the Internal Market clearly identified the establishment of effective cross-border payment systems as one of the few requirements that still need to be met to ensure the functioning of the Internal Market. This requires modernisation of systems, which affects both central banks and commercial banks, and consequent investment on the part of the industry. This Report to the Governors of the central banks of the Group of Ten countries, Basel, November 1990 For the purposes of the present Proposal, "payment netting" means the conversion into one net claim or one net obligation of claims and obligations resulting from payment orders which an institution either issues or receives, with the resuit that only the net claim can be demanded or the net obligation be owed. "Easier cross-border payments: Breaking down the barriers", SEC(92)621 final of 27 March 1992. "Issues of common concern to EC Central Banks in the field of payment systems", by the Ad Hoc Working Group on EC payment systems, September 1992. The iaws on credit transfers and their settlement in Member States of the El J: Report for the European Commission (IXi XV), Wilde Sapte - Brussels, February 1994. A process is already under way. Moreover a number of the large value payment systems which primarily serve the domestic market in their countries are increasingly gaining member banks from other Member States. The legal issues which are the subject of the present proposal have an important underlying influence on the design of the necessary systems and linkages, both those which are specifically conceived to transmit payments across borders and those which have a "cross-border membership". The resolution of these issues will provide a valuable foundation of certainty and serve to minimise legal risks of a systemic kind, as well as the costs which such risks entail. The need for action in this domain is all the more urgent as progress is made towards full Economic and Monetary Union. The European Council, meeting in Madrid on 15 and 16 December, has stressed that the payment system's infrastructure needs to be in place so as to ensure the smooth functioning of an area-wide money market based on the single currency. II. Subsidiarity assessment 1. What are the objectives of the directive, having regard to Community obligations? The principal objectives are threefold: • • • to reduce legal risks associated with participation in payment systems, as was pointed out in the Lamfalussy report of 1990, in particular as regards the legal validity of netting agreements and the enforceability of collateral security; to ensure that in the Internal Market payments may be made free of impediments, thus contributing to the efficiency and the cost-effective operation of cross-border payment arrangements in the European Union; by taking into account collateral constituted for monetary policy purposes, to contribute to developing the necessary legal framework in which the future European Central Bank may develop its monetary policy. The present directive also • • leads to further integration of EC banks in the domestic payment systems of other EC States. The directive therefore supports the free movement of capital stated in Article 73B to 73G and the freedom to provide services under Article 59 of the Treaty; contributes to the preparation of the third stage of EMU, for which efficient payment mechanisms are indispensable. 2. Does the action envisaged stem from an exclusive competence of the Community? Exclusive competence: Article 100A, in conjunction with Article 7A. 3. What arc the possibilities of action available to the Community A number of alternatives were considered: First, the minimalist approach of developing a solution within the current state of the national laws was examined. The question in that context was to examine whether it was possible to design a model contract which could be used by members of a payment system and which could remedy the problems concerned. This approach was rejected for two reasons: • This solution concerns only the parties to the contract, while it is necessary that third parties be legally bound. This is illustrated by the following case: a Country A bank participates in a multilateral netting system with a central settlement agent in Country B. The Country A bank goes bankrupt. In that ease, the creditors -or the liquidator- of the bankrupt Country A bank, attempting to recover part of their claims against that bank, are likely to challenge the netting agreement under Country A law, since that law may not necessarily recognise multilateral netting. If such action were successful, it could jeopardise the whole netting system. • Insolvency law contains so-called "ordre public" rules which can overrule contractually stipulated provisions, liven if a payment system agreement stipulated that in case of insolvency of a member the payment orders introduced before the moment of pronouncement of insolvency proceedings cannot be unwound, a zero-hour-rule e. g. , as it exists in a number of Member States, would overrule that contractual arrangement. Consequently, unwinding could happen, with potentially far-reaching and damaging consequences for the payment system concerned. A second possible solution consisted of the private international law approach, under which it is possible to agree that a payment system established under the laws of Country A, a country whose commercial law recognises netting and whose bankruptcy laws do not interfere with the proper operation of payment systems, would be governed entirely - including all its members from EU countries - by the laws of country A. Whether Member State B's law recognises the finality of netting applicable to bank B, or whether that State's insolvency law has provisions "d'ordre public", like the zero-hour rule, would no longer be relevant. Such an approach did not in the final analysis, however, prove to be attractive. If chosen, it would mean that the courts in every Member State would in principle need to be in a position to interpret and apply the different branches of law (commercial law, insolvency law, etc. ) of all other Member States. Such a solution, at least when standing alone, seemed unnecessarily cumbersome. A third possibility was to recommend to the Member States, without any binding obligations, the necessary modifications in their laws. This approach has some procedural attractions in largely bypassing the EU legislative process but it would not substantially assist the governments of Member States, who would still have to draft and implement any necessary legislation. From the point of view of the financial institutions and payment systems, the solution would lack transparency and legal certainty. Any slight advantage of proceeding in this way was felt to be outweighed by the disadvantages. Therefore, as explained in detail in section I above, a binding instrument is now deemed both timely and necessary. 4. Is uniform legislation necessary or is a directive setting out the general objective and leaving implementation thereof to the Member States sufficient? Uniform legislation is not necessary. A directive setting out the general objectives, as they are outlined hereunder, is sufficient. Section I of the directive deals with the scope of the directive and defines the necessary terms; Section II of the directive lays down the general principle, the objective of which is to ensure that payment netting is made legally enforceable under all jurisdictions and its effects binding on third parties; Section III provides for the irrevocability of payment orders in accordance with the rules of the payment system concerned; Section IV of the directive lays down the general principle, the objective of which is to : • • ensure that insolvency proceedings or any other rule or practice do nol have a retroactive effect on the rights and obligations of participants. determine which insolvency law is applicable to the rights and obligations in connection with direct participation in a payment system in the event of insolvency proceedings against a participant in that payment system. Section V of the directive lays down the general principle, the objective of which is to insulate collateral security from the effects of the insolvency law of the Member State of a failed participant. These provisions set out the general objective pursued, thus leaving implementation to the Member States; where appropriate, institutions are free to determine the precise contents of these general principles. III. Detailed commentary on the articles Article 1 This Directive's main goal is to reduce the systemic risk associated with participation in Payment Systems. There was a general consensus that this directive should have the widest scope possible. To this effect, the directive covers cross-border payment systems as well as domestic systems. Furthermore, it applies to the following two categories: • EC institutions which are participants in third country payment systems and collateral security constituted for such a payment system • Third country institutions which participate in an EC Payment System and the collateral security constituted in favour of that payment system The inclusion of the first category in the directive's scope implies that the benefits of this Directive are extended to third country payment systems as far as their EC participants are concerned. Third country payment systems as such are of course not covered by the directive, but their participants are insofar as they are EC institutions within the meaning of Article 2 (i). As far as the second category is concerned, the essential interest of its inclusion in the directive's scope lies in the fact that it makes it possible to insulate collateral security, pledged by a third country institution in an EC Member State, from a possibly universal insolvency law of that third country. Finally, with a view to the establishment of the future European Central Bank, the pledging of collateral security will increasingly be cross-border. The same problems arise in that respect as in the case of the pledging of collateral in the framework of payments systems. Therefore, the scope of this proposal has been extended to collateral security, pledged in connection with monetary policy operations. Article 2 "institution" has been given a wide scope, so as to include not only credit institutions in the sense of the first Banking Directive, but also investment banks, giro and postal banks and any other undertaking which participates directly in a payment system. "payment order" means an instruction given to carry out a transfer, be it credit or debit, by a book entry on the accounts of a credit institution or of a central bank. On the accounts of a credit institution, since it is this type of payment system which calls -from a public policy standpoint- for the kind of protection which this Proposal for a Directive provides for. On the accounts of a central bank, is added to anticipate the foreseeable development of real time gross settlement facilities, which necessitate movements on the accounts of the Central Banks. "payment system" is defined widely, so as to include systems, regardless of whether they settle on a gross or net basis and of whether they are based on multilateral or bilateral arrangements. Of course, a federation of payment systems in itself is also covered by the directive. Article 3 Many payment systems, handling very large payments ("large value") or smaller values ("retail") depend on the technique known as netting^ or set-off. "Payment netting" is the conversion into one net claim or one net obligation of claims and obligations resulting from payment orders which an institution either issues to one or more other institutions or receives from one or more other institutions, with the result that only the net claim can be demanded or the net obligation be owed. This has the effect of reducing greatly the number of settlement transactions required to process a given number of payments. Instead of settling each payment order individually as it arises during the day the banks involved in a netting agreement settle once by paying (or receiving) a single net balance to (or from) the other members of the system. The legal enforceability of a netting operation with institutions from different Member States ultimately depends on the law of the Member State of origin of these institutions. In a number of Member States netting, especially multilateral netting, is not enforceable under the current state of legislation. If the liquidator of a failed participant in a payment system were on that basis to challenge the netting, this would mean that he could repudiate the net settlement debt, arrived at by netting. Instead he could insists on payment to him of all the individual underlying amounts originally due to that institution. As for the amounts due from the failed institution, they will be claims on paper in the insolvency proceedings and unlikely to be met. This phenomenon of repudiating the debt and accepting the amounts originally due, is called cherry-picking. The consequence of cherry-picking is serious disruption in the payment system at best, at worst the payment system might break down (systemic risk) and cause in turn the inability of other members in the payment system to meet their obligations (knock-on effect). Therefore, Article 3(1) provides that netting is legally enforceable and binding on third parties, even in the event of the opening of insolvency proceedings, insofar as the payment orders have been introduced into the payment system before the opening of insolvency proceedings. Article 3(2) specifically focuses on the cases in which a participant who realises that bankruptcy is becoming inevitable, introduces payment orders into a payment system before the declaration of From the legal point of view, "netting" in this sense is the same technique as is the subject of the proposal for a directive on contractual netting. However the latter deals with unmatured obligations, netted on a bilateral basis only, whilst the present initiative concerns payment streams netted bilaterally or multilaterally. Both types of netting differ markedly from the concept of position netting, as used in the Capital Adequacy Directive. insolvency in order to remove assets to the detriment of the creditors. Therefore, this article confirms that the directive does not shield fraudulent payment orders from invalidation. Such invalidation will, however, not be permitted to occur through the unwinding of the netting operation, something that the directive aims to avoid at all costs, but rather outside the payment system, or indeed in a subsequent netting cycle (via a reverse order). Article 4 It is commonly agreed that the possibility of a significantly large payment being revoked can generate systemic risk, if the revocation occurs during the process leading to settlement in a payment system. It would be unacceptable, on the other hand, to disproportionately limit thé freedom of operation and the freedom of contract of the various parties to a payment system in attempting to reduce or minimise this risk. Thus, having recognised that revocation might otherwise lead to an unwinding of settlement. Article 4 (1) precludes the revocation of a payment order after a contractually agreed time, not only by the parties to the payment system agreement, but also by third parties, e. g. a sub participant. This prohibition is important not only in the case of netting, but also in the case of real time gross settlement arrangements. This does not mean, of course, that a payment order which was not due by the originator, but has been introduced into the payment system, is forever lost to him. Article 4(2) confirms that, if the originator, i. e. a customer, has a right against the beneficiary to reclaim an amount that has been introduced into the payment system, such a right is not cancelled, but will only have to be exercised outside of the payment system, or by a reverse payment operation in the next netting cycle. Articles 5 and 6 Irrespective of whether a payment system operates on the basis of netting or gross-settlement, the different insolvency laws in the different Member States cause further problems, where rules "d'ordre public" included in these insolvency laws would lead to the possibility of cherry-picking, with its very damaging consequences, as described above. This is the case for the so called "zero-hour" rule, which gives retroactive effect to the pronouncement of insolvency. A consequence of this rule is that payment orders introduced after zero hour of the day of pronouncement of insolvency of a participant in a payment system but before the pronouncement of the insolvency, could be challenged by a liquidator of an insolvent institution. The latter would then be in a position to insist on payment to him of all the individual underlying amounts originally due to that institution. As for the amounts due from the failed institution, they will be claims on paper in the insolvency proceedings and unlikely to be met. In order to avoid this possibility, Article 5 provides that insolvency proceedings do not have retroactive effect. There may, however, exist other provisions "d'ordre public", beyond the so called zero-hour rules, which can potentially lead to cherry-picking. This is why Article 6 has been designed as a catch-all provision, which is to cover all those cases which have not been identified but are believed to exist. Therefore, Article 6 states that "in the event of insolvency proceedings against an institution which participates directly in a payment system, the rights and obligations arising from or in connection with participation in that payment system, shall be determined by the insolvency law of the country where the payment system is located. " In practice, Article 6 does, of course, not imply that a separate insolvency proceeding has to be opened in the Member State of location of the payment system. The insolvency of a member institution would continue to fall under the insolvency law of the Member State where that institution is established, as is currently the case. If the liquidator, however, would wish to draw on insolvency provisions "d'ordre public" to challenge a payment made through the payment system, he would have to apply the insolvency law gJl. lk* MuilheL Staleol" location of the payment system. This approach has the advantage that the parties in a payment system only have to examine one insolvency law, namely the insolvency law of the Member State of location of the payment system, instead of having to examine and attempt to reconcile the insolvency law of the Member State of origin of every single participant. This would contribute to reducing costs and eliminating legal uncertainty. Article 7 Finally, the directive addresses the problems associated with collateral security which supports participation in payment systems, on a cross-border basis. Its objective is to avoid a situation where in the case of insolvency of a participant in a payment system, the insolvency law of that participant's Member State would not recognise the validity of collateral security constituted in another Member State. Article 7(1) therefore provides that, in the case of insolvency of a participant, the rights of the pledgee shall not be affected by the insolvency of that participant. This rule is justified for public policy reasons. Vast sums are transferred through the payment systems on a daily basis: if one member were not able to meet its obligations and the collateral could not be realised, this could -in a worst case scenario- have disastrous consequences for the payment system as such, causing no less than the collapse of such a system, with a devastating knock-on effect in financial markets. It should be pointed out that this Proposal does not alter the rule of law applicable to collateral security. This remains, as is the current situation, the law of the Member State where the collateral is located, in accordance with the principle of lex rei sitae. In its second paragraph, Article 7 provides that in the case of a universal third country insolvency law, the effects of that law do not extend to the rights of the pledgee in connection with participation in a payment system or in connection with monetary policy operations, if that collateral security is constituted in a Member State. DRAFT PROPOSAL FOR A EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE ON SETTLEMENT FINALITY AND COLLATERAL SECURITY THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100A thereof. Having regard to the proposal from the Commission, Having regard to the opinion of the European Monetary Institute, Having regard to the opinion of the Economic and Social Committee, In accordance with the procedure laid down in Article 189b of the Treaty establishing the European Community, Whereas the Lamfalussy report of 1990 to the Governors of the central banks of the Group of Ten Countries demonstrated the important systemic risk inherent in payment systems which operate on the basis of one or more legal types of payment netting, be it bilateral or multilateral, on the one hand; whereas the reduction of legal risks associated with participation in real time gross settlement payment systems is of paramount importance, given the increasing development of these systems, on the other; Whereas the reduction of systemic risk regards in particular the finality of settlement and the enforceability of collateral security; whereas collateral security is meant to comprise all means provided by a participant to the other participants in the payment system to secure rights and obligations in connection with that payment system including, among other means, repurchase agreements, insurance contracted by a participant in a payment systems for the benefit of the other participants; Whereas, by ensuring that payments and movement of capital may be made free of impediments in the Internal Market, the present directive contributes to the efficient and the cost-effective operation of cross-border payment arrangements in the European Union; whereas the directive thereby follows up the progress made towards completion of the internal market, in particular towards the freedom to provide services and liberalization of capital movements, with a view to the realisation of economic and monetary union; Whereas the present directive is intended to cover payment systems of a domestic as well as of a cross-border nature; whereas debit as well as credit transfers are covered; whereas the directive is applicable to EC payment systems and collateral security constituted by their participants, be they EC or third country participants, in connection with participation in these payment systems; whereas the directive also covers EC institutions which participate in third country payment systems; whereas financial flows are increasingly taking place on a world-wide level; whereas EC institutions and EC payment systems thus are bound to establish and maintain close operational links with third country payment systems and to participate in them; whereas it is essential, therefore, that the cross-border relations between EC institutions and EC payment systems on the one hand and third country payment systems on the other are addressed and facilitated by this directive with a view to avoiding impediments for EC institutions to participate in third country payment systems arising from a of lack of legal security; whereas efficient EC payment systems are vital for the Internal Market and cannot operate properly without links to third country payment systems because financial markets are inextricably connected with one another; J Whereas the directive, by covering collateral security provided in connection with monetary policy operations, assists the EMI in its task of promoting the efficiency of cross-border payments with a view to the preparation of the third stage of economic and monetary union and thereby contributes to developing the necessary legal framework in which the future European Central Bank may develop its monetary policy; Whereas the purpose of the present directive is to ensure that netting is legally enforceable under all Member States' jurisdictions and binding on third parties; whereas the purpose of the directive is also to ensure that payment orders cannot be revoked after a contractually agreed time; whereas the directive aims at securing that insolvency proceedings do not have a retroactive effect on the rights and obligations of participants; whereas the present directive furthermore aims at determining -in the event of insolvency proceedings against a participant in a payment system- which insolvency law is applicable to that part of the insolvency which the rights and obligations in connection with direct participation in that payment system are; whereas the present directive finally intends to insulate collateral security from the effects of the insolvency law applicable to the failed participant; Whereas the present Directive also applies to the relationship between an institution and a member of a payment system which transfers the payment orders of such institution to the payment system, given that this relationship can be considered in itself to be a separate payment system; Whereas the adoption of the present directive constitutes the most appropriate way of realising the above objectives; whereas the present proposal is nessary to realise these objectives and does not go beyond the goal of realising these objectives; HAVE ADOPTED THIS DIRECTIVE: /. SCOPE and DEFINITIONS Artkk ]-SWJK The provisions of this directive shall apply to : (1) any EC payment system operating in any currency and the ECU and to collateral security provided in connection with participation in such a system. (2) any EC institution which participates directly in a third country payment system and to collateral security provided in connection with participation in such a system. (3) collateral security provided in connection with monetary policy operations. /fe For the purpose of this directive : Artkk 2- Définitions (a) "institution" means any undertaking as defined in Article 1 of Council Directive 77/780/EEC including the institutions set out in the list in Article 2(2) thereof, which participates directly in a payment system, and any other undertaking which participates directly in a payment system; (b) "direct" participation means participation in a payment system entailing responsability for settlement; (c) "EC institution" means any institution which has its registered office in a Member State; (d) "third country institution" means any institution which is not an EC institution; (e) "payment order" means any instruction to place at the disposal of a final recipient an amount of money by means of a book entry on the accounts of a credit institution or a central bank; (I) "insolvency proceedings" means any measure which, for reasons of impending or actual inability to meet financial obligations, is pronounced by a judicial or administrative authority for the benefit of a collectivity of creditors, and which precludes from making payments or disposing of property; (g) "payment netting" means the conversion into one net claim or one net obligation of claims and obligations resulting from payment orders which an institution either issues to one or more other institutions or receives from one or more other institutions, with the result that only the net claim can be demanded or the net obligation be owed; (h) "payment system" means any written agreement between two or more institutions for executing payment orders; (i) "EC payment system" means a payment system located in a Member State. A payment system shall be deemed to be located in the Member State the law of which has been chosen by the institutions which participate directly in that payment system. In the absence of choice, the payment system shall be deemed to be located in the Member State where the settlement takes place; (j) "third country payment system" means any payment system which is not an EC payment system; (k) "monetary policy operation" means an outright (spot and forward) buying and selling operation in the financial markets or such an operation under a repurchase agreement, or lending or borrowing of claims and marketable instruments, whether in Community or in non-Community currencies or in precious metals, by a Member State Central Bank or by the future European Central Bank; it also means the conduct of credit operations, by a Member State Central Bank or by the future European Central Bank, with credit institutions or other market participants, with lending being based on adequate collateral; M (!) "collateral security" means all assets, provided for the purpose of securing rights and obligations potentially arising in a payment system or provided to Member State Central Banks or to the future European Central Bank in connection with monetary policy operations. //. FINALITY of PAYMENT NETTING Artkk 3-Payment Netting ( 1 ) Payment netting is legally enforceable and shall, even in the event of insolvency proceedings against any institution which participates directly in a payment system, be binding on third parties, provided that the payment order was entered into the payment system before the opening of insolvency proceedings. The moment of entrance shall be defined by the rules of that payment system. (2) Any rule on the setting aside of contracts and transactions entered into before the opening of insolvency proceedings, shall not lead to the unwinding of the netting. ///. REVOCA TION of PA YMENT ORDERS Article 4-Revocation ( 1 ) A payment order may not be revoked either by an institution which participates directly in a payment system or a third party as against the other direct participants in that payment system after the moment defined by the rules of that payment system. This rule applies notwithstanding the opening of insolvency proceedings. (2) Any right which the originator of a payment order might have to a refund shall be exercised without prejudice to paragraph 1. IV. NON-RETROACTIVITY and APPLICABLE INSOL VENCYLA W Article S-Non-Retroactivity Insolvency proceedings shall not have retroactive effects on the rights and obligations of an institution in connection with direct participation in an EC payment system. Any other rule or practice which has a retroactive effect shall be superseded. Article 6-Applicable Insolvency Law In the event of insolvency proceedings against an institution which participates directly in a payment system, the rights and obligations arising from or in connection with direct participation in that payment system, shall be determined by the insolvency law of the country where the payment system is located. V. INSULA TION of the RIGHTS of the PLEDGEE from the EFFECTS of the INSOLVENCY of the PLEDGER Article 7-Insulation from the effects of insolvency (1) The rights of a pledgee in connection with liabilities of one participant to one or more other participants in a payment system or the rights of monetary authorities to whom collateral security has been pledged in connection with monetary policy operations, shall not be affected by the opening of insolvency proceedings against the pledger. The collateral security shall be realised for the satisfaction of rights in connection with participation in a payment system or with monetary policy operations with priority over all other creditors. (2) Where a third country institution constitutes collateral security in a Member State in connection with participation in an EC payment system or in connection with monetary policy operations, the rights of the pledgee shall not be affected by the opening of insolvency proceedings against that third country institution. VI. FINAL PROVISIONS Article 8 - Implementation (1) Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 31 December 1998 at the latest. They shall immediately inform the Commission. (2) When Member States adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such a reference shall be laid down by the Member States. (3) Member States shall communicate to the Commission the text of the laws, regulations and administrative provisions which they adopt in the field governed by this Directive. In this Communication Member States shall provide a table of correspondence showing the national provisions which exist or are introduced in respect of each article of this directive. Article 9 - Report to the European Parliament and the Council A3 No later than three years after the date mentioned in Article 8(1), the Commission shall present a report to the European Parliament and the Council on the application of this Directive, accompanied where appropriate by proposals for its revision. This Directive is addressed to the Member States. Article 10 Done at Brussels, For the European Parliament For the Council The President The President AH BUSINESS IMPACT ASSESSMENT Proposal for a European Parliament and Council Directive on settlement finality and collateral security l. a. Taking account of the principle of subsidiarity, why is Community legislation necessary and what are its main aims? Research carried out on behalf of the Commission by banking lawyers1, together with the analyses made by the Commission's working group, confirm that there are crucial differences between the laws of the Member States which prejudice the legal validity of certain key features of payment systems2. One of the central features of a sound payment system is that there must be no doubt as to when and how settlement becomes final. In the current situation, finality in a payment system whose participants are domiciled in different legal jurisdictions,(as under the Treaty and the Second Banking Directive will increasingly be the case) depends ultimately on the laws of the various Member Slates whose institutions are members. Another essential prerequisite is that there must be legal certainty that in the case a participant fails to meet its obligations vis-à-vis the payment system, the latter can realise the collateral security pledged by that participant. In the current situation, the only way to ensure that, is to constitute the collateral security under the same law as the payment system itself, so as to avoid conflicts of law. This is contrary to the principle of an Internal Market. Legal certainty as to collateral security and as to finality of settlement can only be achieved if the national legislations are changed in a similar way in each Member State. The most efficient way of achieving this goal is by way of a directive laying down the necessary minimum standards. l. b. Are there likely to be any wider benefits and disadvantages from the proposal? If any effect is to be expected for the financial sector, it will be one of protection of current employment. The proposal's main goal is to strengthen the stability of payment systems and therewith of inter bank financial relations and to avoid the knock-on effects that currently could arise in the case of bankruptcy of a large participant in a payment system. Consequently, the loss of employment that would occur in such a case would be avoided as well. The laws on credit transfers and their settlement in Member States of the EU: Report for the European Commission (DG XV), Wilde Sapte - Brussels, 1994. The key differences referred to are: - - settlement finality in netting schemes: different possibilities of unwinding the settlement; the effect of insolvency of a participant, on netting schemes: different powers of liquidators to prevent settlement occurring or to unwind it; rules on revocation: different rules on the time when a payment order becomes irrevocable - Moreover, the establishment of a legal framework in order to rule out the legal uncertainty associated with cross-border payment systems, is likely to encourage the further development of these systems. The consequent increase in the volume of business might therefore generate employment. I. e. Were alternative proposals considered, and with what outcome (e. g. codes of conduct, voluntary arrangements)? As explained under II. 3 of the explanatory memorandum, a number of other possibilities were considered, but these were abandoned for the reasons exposed. 2. Who will be affected by the proposal? Which sector of business? What are the size classes and what is the total employment? The proposal will be applicable to any undertaking which participates directly in a payment system. In practice, the large majority of these undertakings will be credit-institutions. Are there any significant features of the business sector, e. g. dominance by a limited number of large firms? The main feature of this sector is the hitherto lack of integration of payment systems at European level. Are there implications for very small businesses, the craft sector or the self-employed? Although small businesses are very unlikely to constitute a payment system among themselves, such a system would be covered by the Directive. However, as end-users of payment systems, they will benefit from the proposal and its effect of elimination of legal risks, increased efficiency and reduction of costs. These remarks apply equally to the craft sector and the self-employed. Are there particular geographical areas in the Community where these businesses are located? No. 3. What will businesses have to do to comply with the proposal? What will be the compliance costs? No costs other than the legislative ones are to be expected. Are there other administrative procedures or forms to complete? No. Are licenses or marketing authorisations required? No. Will fees be charged? No. M 4. What economic effects, costs and benefits is the proposal likely to have? On employment? Within the payment systems industry, the net effect, if such effect is to be expected at all, should be positive. Within the segment of SMEs, employment benefits are expected (more efficient payment services => widening of intra-EU trade potential => contribution to growth and higher employment => greater and more specialised demand for efficient payment services, etc. ). On investment and the creation or start up of new businesses? Marginal effect, if any. On the competitive position of businesses, both in the Community and third countries' markets? The efficiency gains and reductions in costs for business within the Community will be positive (See paras. 1 and 4 above). Third country businesses will benefit from the advantages of this Directive inside the Community to the same extent as Community businesses do. The unilateral extension of the benefits of this Directive to third country payment systems, e. g. the protection against undue revocation, the protection against retroactive effects of insolvency proceedings and the insulation of collateral security from foreign insolvency laws, will also benefit third country payment systems. Community businesses will indirectly benefit from the advantage of the extension of the Directive's scope to the EC participants of the third country payment systems. Therefore, no distortion of competitiveness is to be expected. On public authorities for implementation? Legislative costs of passing the necessary domestic legislation. Are there other indirect effects? No. What are the costs and benefits of the proposal? • costs: no costs, other than the legislative ones are to be expected. • benefits: -elimination of legal risks associated with participation in payment systems, leading to more efficient and cost-effective operation of EC payment systems -completion of the Internal Market: the proposal will also facilitate the access by banks from one EC Member State, into the payment systems of another EC Member State (remotely or via a branch). -further integration of the EC financial sector, both domestically and cross-border, thus contributing to the free movement of capital and to the freedom of cross-border services. -cross-border use of collateral securities is facilitated. This contributes to the free movement of capital, to the freedom of cross-border services, to the development of securities markets, to developing the necessary legal framework in which the future European Central Bank may develop its monetary policy. • balance: overwhelmingly positive on the benefit side. A 5. Impact on SMEs. Does the proposal contain measures to take account of the specific effect on SMEs - if not, why not? Are reduced or different requirements appropriate? No. No direct effect on SMEs. Consultation 6. Indicate at what stage the consultations were undertaken and the date of publication of the prior notification of an intent to introduce legislation? The Commission has, over many years, promoted the fullest consultation of all interested parties and earliest disclosure of its line of policy in this area. This has materialised in the following steps: -Green Paper3 (consultation paper) of September 1990, calling lor comments from all interested parties; annexed to the Green Paper was a decision to set up two consultative groups; -setting up of two permanent consultative groups on payment systems in March 1991, with intensive frequency of meetings throughout 1991 and early 1992, leading to reports to the Commission (in February 1992) published in March 1992; -Commission working document of March 19924, based on the detailed reports of these consultative groups, announcing the Commission's proposed policy, including intent to introduce legislation in this respect. furthermore, two consultative hearings with representatives of the European Credit Sector Industry were held in the spring of 1994 and October 1995, at key stages of the preparatory work leading to the present proposal (see Section I above; background). List of organisations which have been consulted about the proposal and set out in detail their main views, including their concerns and objections to the final proposal. Why is it not possible or desirable to accede their concerns? European credit sector associations : The European credit sector associations have been consulted throughout. Two "hearings" have taken place with the Commission and its working party, the latest in October 1995. There is an overall support for this proposal, which is deemed essential by the sector itself. Government experts, including representatives of the EC central banks: Governments representatives which were members of the Commission's working group, take a positive stand on this proposal. There are differences on some technical issues, which it is not possible to resolve entirely within the working group. The main point at issue is that some delegations wished to have an (even more) ambitious approach, covering so called "securities settlement" or "obligations netting". EMI: a representative of the EMI has been present in the working group as an observer. Were the SME Business Organisations formally consulted? If not, why not? No. However, SMEs and Retailer organisations were kept regularly informed of progress being made, through their representatives in the Commission's consultative groups on payment systems. 1 Discussion paper on "Making payments in the Internal Market", COM(90)447. 4 "Hasier cross-border payments: breaking down the barriers", SHC(92) 621 of 27 March 1l>92 A Monitoring and Review 7. Explain how the effects and compliance costs of the proposal will be monitored and reviewed. How will complaints be dealt with? Can the proposal, once it is legislation, be amended easily? The proposal contains in its Article 9 an undertaking on the part of the Commission to report on these matters to the European Parliament and Council. The necessary preparation for this will be done by the Commission acting with its existing two consultative groups on payment systems. There is no comitology procedure, therefore amendments to the proposal, once this is adopted, will require normal legislative procedures. Contact point Directorate General XV Dr. Peter TROBERG Av. de Cortenberg, 107 B-1040 Brussels Tel: 295. 41. 09 295. 79. 78 295. 32. 19 295. 94. 62 Fax: 295. 07. 50 11 ISSN 0254-1475 COM(96) 193 final DOCUMENTS EN 09 Catalogue number : CB-CO-96-201-EN-C ISBN 92-78-03483-5 Office for Officiai Publications of the European Communities L-2985 Luxembourg 20


title: Proposta de REGULAMENTO (CE) DO CONSELHO que altera o Regulamento (CEE) n 1784/77, relativo à certificação do lúpulo

eurovoc_concepts:
German Democratic Republic
food processing
hops
quality label
unification of Germany

text: COMISSÃO DAS COMUNIDADES EUROPEIAS Bruxelas, 30. 05. 1996 eOM(96) 238 finai Proposta de REGULAMENTO (CE) DO CONSELHO que altera o Regulamento (CEE) n° 1784/77, relativo à certificação do lúpulo (apresentada pela Comissão) EXPOSIÇÃO DOS MOTIVOS PropÕe-se que o Conselho adopte a presente proposta de regulamento que altera o Regulamento (CEE) n" 1784/77 relativo à certificação do lúpulo. Dado que na antiga República Democrática Alemã a certificação do lúpulo é efectuada, tradicionalmente e por motivos técnicos, após a transformação em granulados, o que não está em conformidade com a legislação comunitária, mas que a realização de novos investimentos exige um período mais longo do que o inicialmente previsto, propõe-se prorrogar para 31 de Dezembro de 1996 a data de aplicação das medidas transitórias no sector do lúpulo após a unificação da Alemanha. A presente proposta de regulamento não origina qualquer despesa directa para o orçamento comunitário. A presente proposta de regulamento não tem impacto nas PME. i Proposta de REGULAMENTO (CE) N°. DO CONSELHO que altera o Regulamento (CEE) n° 1784/77, relativo à certificação do lúpulo O CONSELHO DA UNIÃO EUROPEIA, Tendo em conta o Tratado que institui a Comunidade Europeia, Tendo em conta o Regulamento (CEE) n° 1696/71 do Conselho, de 26 de Julho de 1971, que estabelece uma organização comum de mercado no sector do lúpulo1, e, nomeadamente, o n° 4 do seu artigo 2o, Tendo em conta a proposta da Comissão, Considerando que o Regulamento (CEE) n° 1784/772, precisa em que estádio se deve verificar a certificação e prevê as condições em que os produtos à base de lúpulo podem ser submetidos a uma transformação complementar; Considerando que, tradicionalmente, na antiga República Democrática Alemã, o lúpulo é tratado, após a colheita, de forma diferente da utilizada nas outras zonas da Comunidade, uma vez que, em muitas das explorações que produzem lúpulo, a limpeza e a primeira secagem dos cones são feitas paralelamente à monda e à prensagem em granulados, já que os equipamentos existentes não permitem separar as duas etapas; que este processo não é conforme com a legislação comunitária, a qual exige que a certificação seja feita antes de qualquer transformação; que para permitir aos produtores repartir os novos investimentos por um período adequado, convém prever um período de transição mais prolongado que o previsto no Regulamento (CEE) n° 2239/91 da Comissão, de 26 de Julho de 1991 - relativo a medidas transitórias aplicáveis no sector do lúpulo após a unificação da Alemanha (que expirou em 31 de Dezembro de 1992) - no Regulamento JO n° L 175 de 4. 08. 1971, p. 1. Regulamento com a última redacção que lhe foi dada pelo Regulamento (CEE) n° 3124/92 (JO n° L 313 de 30. 10. 1992, p. 1. ). JO n° L 200 de 8. 08. 1977, p. 1. Regulamento com a última redacção que lhe foi dada pelo Regulamento (CEE) n° 1987/93 (JO n° L 182 de 24. 07. 1993, p. 1. ). JOn°L 204 de 27. 07. 1991, p. 14. 2, (CEE) n° 1784/77; que, em 31 de Dezembro de 1995, a situação ainda não tinha sido regularizada relativamente a determinadas explorações; que é conveniente, por conseguinte, prolongar a referida derrogação por um período de um ano e alterar a lista das referidas explorações, ADOPTOU O PRESENTE REGULAMENTO: Artigo Io O Regulamento (CEE) n° 1784/77 é alterado do seguinte modo: 1. No n° 3, segundo parágrafo, do artigo Io, a data de 31 de Dezembro de 1995 é substituída pela data de 31 de Dezembro de 1996. 2. O Anexo do Regulamento (CEE) n° 1784/77 é substituído pelo Anexo do presente regulamento. Artigo 2o O presente regulamento entra em vigor no sétimo dia seguinte ao da sua publicação no Jornal Oficial das Comunidades Europeias. O presente regulamento é aplicável a partir de 1 de Janeiro de 1996. O presente regulamento é obrigatório em todos os seus elementos e directamente aplicável em todos os Estados-membros. Feito em Pelo Conselho 4- ANEXO "ANEXO Explorações nas quais pode ser efectuada a certificação depois da transformação em granulados LAND DA SAXÓNIA-ANHALT: Eichenbarieben (antiga Irrleben) Osterweddingen Blumenberg (antiga Langenweddingen) LAND DA TURÍNGIA: Kutzíeben (antiga Bad Tennstedt) Heringen Kindelbrueck Vogelsberg (antiga Grossbrembach) Grossenehrich Hohenebra". b FICHA FINANCEIRA 1. RUBRICA ORÇAMENTAL : 181 DOTAÇÕES: 18 milhões de ecus 2. DESIGNAÇÃO DA ACÇÃO : Proposta de regulamento do Conselho que altera o Regulamento (CEE) n° 1784/77, relativo à certificação do lúpulo. 3. BASE JURÍDICA : Regulamento (CEE) n° 196/71 do Conselho 4. OBJECTIVOS DA ACÇÃO : Alteração da data prevista no n° 3 do artigo Io do Regulamento (CEE) n° 1784/77, bem como do seu Anexo. 5. CONSEQUÊNCIAS FINANCEIRAS PERÍODO DE 12 MESES (milhões de ecus) EXERCÍCIO EM CURSO (96) (milhões de ecus) EXERCÍCIO SEGUINTE (97) (milhões de ecus) 5. 0 DESPESAS A CARGO - DO ORÇAMENTO DA CE (RESTITUIÇÕES/INTERVENÇÕES) 5. 1 RECEITAS - RECURSOS PRÓPRIOS DA CE (DIREITOS NIVELADORES/ /DIREITOS ADUANEIROS) - NO PLANO NACIONAL 1998 (milhões de ecus) 1999 (milhões de ecus) 2000 (milhões de ecus) 2001 (milhões de ecus) 5. 0. 1 PREVISÃO DAS DESPESAS 5. 1. 1 PREVISÃO DAS RECEITAS 5. 2 MODO DE CÁLCULO 6. 0 FINANCIAMENTO POSSÍVEL POR DOTAÇÕES INSCRITAS NO CAPÍTULO CORRESPONDENTE DO ORÇAMENTO EM EXECUÇÃO 6. 1 FINANCIAMENTO POSSÍVEL POR TRANSFERÊNCIA ENTRE CAPÍTULOS DO ORÇAMENTO EM EXECUÇÃO 6. 2 NECESSIDADE DE UM ORÇAMENTO SUPLEMENTAR 6. 3 DOTAÇÕES A INSCREVER NOS ORÇAMENTOS FUTUROS OBSERVAÇÕES : £ ISSN 0257-9553 COM(96) 238 final DOCUMENTOS PT 03 N. ° de catálogo : CB-CO-96-262-PT-C ISBN92-78-05173-X Serviço das Publicações Oficiais das Comunidades Europeias L-2985 Luxemburgo


title: A Bizottság 958/96/EK rendelete (1996. május 30.) a 774/94/EK tanácsi rendeletben előírt behozatali szabályoknak a baromfihús-ágazatban történő alkalmazása részletes szabályainak megállapításáról szóló 1431/94/EK rendelet módosításáról

eurovoc_concepts:
import licence
poultrymeat
tariff quota

formats: html pdf print

text: 140 HU Az Európai Unió Hivatalos Lapja 03/19. kötet 31996R0958 L 130/6 AZ EURÓPAI KÖZÖSSÉGEK HIVATALOS LAPJA 1996. 5. 31. A BIZOTTSÁG 958/96/EK RENDELETE (1996. május 30. ) a 774/94/EK tanácsi rendeletben előírt behozatali szabályoknak a baromfihús-ágazatban történő alkalmazása részletes szabályainak megállapításáról szóló 1431/94/EK rendelet módosításáról AZ EURÓPAI KÖZÖSSÉGEK BIZOTTSÁGA, tekintettel az Európai Közösséget létrehozó szerződésre, tekintettel a 2198/95/EK bizottsági rendelettel (1) módosított, a kiváló minőségű marhahúsra, a sertéshúsra, baromfihúsra, búzára és kétszeresre, korpára, korpás lisztre és más maradékra előírt egyes közösségi vámkontingensek megnyitására és kezelé- sére vonatkozó rendelkezésekről szóló, 1994. március 29-i 774/94/EK tanácsi rendeletre (2) és különösen annak 7. cikkére, tárgyalások uruguayi tekintettel a többoldalú kereskedelmi fordulóján megkötött megállapodások a végrehajtásához mezőgazdasági ágazatban szükséges kiigazításokról és átmeneti intézkedésekről szóló, 1994. december 22-i 3290/94/EK tanácsi rendeletre (3) és különösen annak 3. cikke (1) bekezdé- sére, mivel a legutóbb a 2916/95/EK bizottsági rendelettel (4) módo- sított 1431/94/EK bizottsági rendelet (5) részletes szabályokat állapít meg a 774/94/EK rendelet által előírt behozatali rend- szernek a baromfihús-ágazatban való alkalmazására vonatko- zóan; mivel a spekuláció megelőzése érdekében és a szerzett tapaszta- latok fényében, különösen a kérelmezők nagy számát tekintve, módosítani kell a rendszerhez való hozzáférés feltételeit, annak érdekében, hogy kizárják azokat a piaci szereplőket, akiknek nem áll saját igényeik kielégítésére; szándékukban felhasználni az engedélyeket mivel az engedélyek érvényességi ideje lehetővé teszi, hogy az importőrök az egyes negyedévek első tíz napja során nyújtsák be kérelmeiket; mivel a Baromfihús- és Tojáspiaci Irányítóbizottság elnöke által kitűzött határidőn belül nem nyilvánított véleményt, ELFOGADTA EZT A RENDELETET: 1. cikk Az 1431/94/EK rendelet a következőképpen módosul: 1. A 3. cikk a) pontja helyébe a következő rendelkezés lép: „a) A behozatali engedély kérelmezőjének természetes vagy jogi személynek kell lennie, aki a kérelem benyújtásakor a tagállam hatáskörrel rendelkező hatósága előtt hitelt érdemlően bizonyítja, hogy a két megelőző naptári év mindegyikében (terméksúlyban) legalább 100 tonnányit importált a 0207, 1602 31, 1602 32 és az 1602 39 KN-kód alá tartozó termékekből. A termékeiket végső vállalko- felhasználóknak értékesítő kiskereskedelmi zások, illetve éttermek azonban e rendszer kedvezmé- nyezettjeinek köréből ki vannak zárva. ”; 2. A 4. cikk (1) bekezdésének első albekezdése helyébe a következő rendelkezés lép: „Az engedélykérelem a 2. cikkben meghatározott egyes időszakok első tíz napján nyújtható be. ” 2. cikk Ez a rendelet 1996. június 1-jén lép hatályba. Ez a rendelet teljes egészében kötelező és közvetlenül alkalmazandó valamennyi tagállamban. Kelt Brüsszelben, 1996. május 30-án. a Bizottság részéről Franz FISCHLER a Bizottság tagja (1) HL L 221. , 1995. 9. 19. , 3. o. (2) HL L 91. , 1994. 4. 8. , 1. o. (3) HL L 349. , 1994. 12. 31. , 105. o. (4) HL L 305. , 1995. 12. 19. , 49. o. (5) HL L 156. , 1994. 6. 23. , 9. o


title: Proposal for a COUNCIL DECISION concerning the objectives and detailed rules for restructuring the Community fischeries sector for the period from 1 January 1997 to 31 December 2002 with a view to achieving a balance on a sustainable basis between resources and their exploitation

eurovoc_concepts:
Community fisheries
common fisheries policy
fishery management
fishery resources
fishing fleet

text: COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 29. 05. 1996 COM(96) 237 final 96/0142 (CNS) Proposal for a concerning the objectives and detailed rules for restructuring the Community fisheries sector for the period from 1 January 1997 to 31 December 2002 with a view to achieving a balance on a sustainable basis between resources and their exploitation (presented by the Commission) EXPLANATORY MEMORANDUM 1. Context of the restructuring of the Community fleet The Community fishing fleet is responsible for an overexploitation of the resources, to the extent that a certain number of fish stocks are in a critical state, far outside the limits imposed by the principles of sustainable development. This situation puts the endurance even of fishing activities imp peril, and weakens the whole of the Union's fishing industry and the economic equilibrium of areas dependent on fishing. Very recently the Council of Fisheries Ministers were forwarded Communications from the Commission concerning the further degradation of fishing conditions and the remedies that it should be taken as soon as possible to bring the industry out of this deep crisis. It should be recognized that amongst the primary causes of this situation is the large overcapacity of the Community fleet, which successive capacity reduction programmes have all failed to control sufficiently. Under these conditions, it is essential to pursue the restructuring of the Community fleet in order tp guarantee a sustainable balance between the resources and their exploitation. 2. Preparatory work: biological considerations and consultations with professionals In order to determine the appropriate nature and magnitude of measures to restructure the Community fishing fleet, the Commission has worked along two lines: the assignment of a group of independent and internationally renowned experts to prepare a report to advise the Commission on the measures to adopt in order to adjust the levels of fishing mortality by fishery and fleet to values that are compatible with the sustainable development of the fisheries; the organization of 35 professional forums at regional and European levels on the social and economic consequences of the restructuring measures for areas dependent on fishing and for the fishing industry. The conclusions of the report of the group of experts was delivered to the Commission on 23 March and showed that a rapid reduction in the fishing mortality was needed in a large number of fisheries, by at least 20% to bring about a real effect and by at most 40% initially so that the first effects can be measured. For certain stocks where the state is judged to be critical the measures must be immediately put into action, for vulnerable stocks they must be undertaken as soon as possible, and for stocks in equilibrium it would be necessary to neutralize the effects of technical progress. The regional consultations showed that the fleet restructuring measures should be differentiated and applied over a reasonable period of time given their impact on all of the activities in coastal areas that linked to fishing. It is clear that it would be possible to give particular treatment to the case of small coastal fisheries, a segment of the fleet supporting many jobs and taking resources of local importance. The specific character of certain fishing activities was made apparent during the course of these consultations and should be taken into account in the preparation of the restructuring programmes, Member State by Member State, so that a certain flexibility can be introduced depending on the particular circumstances. 3. Justification for the Commission proposal. 3. 1. General objectives The objective is to bring the fleet size, maritime region by maritime region, fleet segment by fleet segment, to levels that guarantee the sustainability of fishing activities and a higher value for fish resources. The proposal of the Commission aims to guide the evolution of the fishing capacity of the European fishing fleet over 6 years, a sufficiently long term perspective to absorb the impact in areas dependent on fishing while also respecting as closely as possible the management recommendations of the scientists, thus ensuring a stable economic balance in areas dependent on fishing through the sustainability of fishing activities. To this effect a clear distinction is made between static gears, subject to other particular provisions (technical measures), and towed gears. Moreover, the proposal allows Member States to implement specific programmes to manage fishing effort, which would permit them to reduce fishing activity (another parameter of fishing effort) and in this way obtain an adjustment of the fleet capacity reductions required. In the case that the measures proposed and analysed according to the procedures of Article 4 of Regulation 109/94 are accepted, the objectives of their multiannual guidance programme would be revised according to the procedures envisaged by Article 18 of Regulation (EC) No 3760/92 (Management Committee). These specific programmes continue tP ensure that the fishing effort ceilings prescribed by fleet segment are respected. For the segments of the fleet that use static gears a general reduction of 2% per year will be requested to compensate for the average affect of technical progress on fishing effort. The Member States will moreover be required to take measures to limit the fishing effort of these fleets as appropriate. For the segments of the fleet that use towed gears it is appropriate to adapt the scope of the measures to the biological constraints presented by the various fisheries as well as the characteristics and peculiarities of the sector. To this end, the Commission has identified 5 types of fisheries or groups of fisheries. The detailed rules for the passage from the objectives fixed for the segments of the MGP III to the objectives for the segments of MGP IV will be adopted, Member State by Member State, in the framework of the provisipns pf Article 5 pf Regulation 3699/93 cpncerning the adpptipn pf an MGP IV. These detailed rules ensure that the effort ceilings by segment required by the present Decision are respected. 3. 2 Adaptation of measures applicable to towed gears to the conditions of different fisheries 3. 2. 1. Absolute biological urgency (30 + 10 = 40) This must be applied without concession to stocks whose state is critical in the sense that there is a risk of biological collapse that would certainly be followed by the economic ruin of the corresponding fleet segments. For these segments the Commission proposes a firm reduction of 40% over 6 years, of which 30% over the first three years. This urgency applies to the majority of demersal fisheries of the North Sea and the Baltic, with the particular case of Baltic Salmon for which the closure of the fishery is proposed but for which could be limited tp a reduction of fishing effort of (30 + 20 = 50) for socio-economic reasons. Another particular case is that of the sardine fishery off Portugal, where the state of the stock justifies the biological urgency measure. In the vital interests of the fishermen themselves the Commission considers that its duty is to defend this position without any concession. 3. 2. 2. Lesser urgency (20 + 20 » 40 Or 20 + 10 = 30 or 15 + 15 = 30) These fisheries show obvious signs of overexploitation but their ability to recover (pelagics) or the particular characteristics of their ecological niche (benthics) offer a better chance for the survival of the species. In this case the Commission proposes reductipn rates that are in line with scientific analyses but considers that for specific social reasons there is room for negptiation. 3. 2. 3. Prevention of the expansion of fishing effort ( 6 + 6 = 12) In prder tp prevent an expansipn pf fishing effort in all the Pther fisheries cpnsidered tp be in equilibrium a general reductipn pver the peripd pf 6 years pf 12% in capacity is requested to neutralize the effects of technical progress, estimated at 2% per year. 3. 2. 4. Permit a moderate expansion of fishing effort (0 + 0 = 0) The analyses of the tropical tuna fisheries or those of deepwater species allow, according to the geographical area, the possibility of a small increase in fishing effort that, taking into account technical progress, results in a stabilization pf the pbj écrives. 3. 2. 5. Particular cases of bilateral and multilateral fisheries agreements For multilateral agreements concerning fisheries for which there exists scientific opinion on which to fix guidelines for sustainable levels of fishing effort (NAFO/OPANÔ, NEAFC, IATTC), it is proposed that the rates and timing of the reductions conform to the opinions of these sources. For the resources accessible tp Cpmmunity fishing vessels in the framewprk pf bilateral fishing agreements concluded between the Community and a third cpuntry, these depend both on biological considerations and on political factors. In consequence, the capacity of the fleet segments involved in bilateral fisheries agreements will be adjusted in accordance with the resources accessible under these agreements, as expressed in the provisions of the agreements. Tp this end the segments cpncerned will be identified in the framewprk pf the provisions applied under Article 5 of Regulation 3699/93 concerning the MGP IV. 3. 3. The real effects of restructuring measures on the Community fleet Although these measures may appear severe the effects should be considered relative to production capacity and employment in the areas depending on fishing. It will be remembered that the application in MGP III pf reductipn rates pf 20%, 15%, and 0% pn the demersal, benthic and pelagic resources led to real reductions in global capacity pf only about 8% It will be the same fpr the MGP IV where the coastal fleet is relatively preserved, and also many segments target stocks that are not very sensitive. The average global rate of reduction programmed fpr the whple Cpmmunity fleet will npt hpwever be known until after the precise formulation of the objectives in the Commission decisions adopting the MGP IV. 4. Impact of the restructuring on the areas dependent on fishing and the fishing industry Since 1991, when the contribution of the "Fisheries" funds to the reform of the structural funds was examined, the Commission began an extensive socio-economic study in theUnion's most representative areas dependent on fishing*1*. Between September 1995 and March 1996 the Cpmmissipn conducted 35 regional and European consultations with the industry with a view to the prepraration of the MGP IV and to appreciate the socio-economic consequences linked to the restructuring of the sector. It is useful to first of all assess what could become of the sector without a restructuring programme. The danger of the collapse of certain stocks warns of the economic ruin of certain areas dependent on fishing. Thereafter, for the stocks not presenting this danger, one would probably witness a slow deterioration in the exploitation conditions linked to an overexploitation that the weakness of market prices would encourage. One has only to see the general economic situation of the sector and the constant decline in employment to be convinced that energetic measures must be taken to break this vicious circle. In the framework of a programme for the elimination of fleet overcapacity, the measures adopted will result in the cessation of activity for a certain number of fishing vessels. These vessels will not be replaced. The vessels that are left will however no longer be overexploiting the resources, and will improve their own situation as the global production increases. It is convenient here to distinguish the economic effects from the social effects : (1) The 21 regional socio-economic studies in the fisheries sector (1991/93)and their synthesis (1993). From the economic point of view the expected effect of the restructuring is: a significant improvement in the economic results of fisheries companies; greater competitiveness of European products, to the benefit of the industry. l From the social point of view, the short term effect will be a reduction in the number employed in the industry. However in the medium term, with an expected increase in production, the "downstream" employment will be regenerated. In order to minimize the social consequences pf the restructuring pf the Cpmmunity fleet, the Cpmmissipn prpppses 5 type pf measure: a spreading pf the capacity reductipn measures over a longer period of time; less rapid reductions for the stocks in less danger; particular treatment for small scale fisheries; the resort to regimes to manage fishing effort to attenuate the reductions in capacity; the implementatipn pf accpmpanying socip-ecpnpmic measures adopted by the Councl in December 1995. 5. Accompanying socio-economic measures The negative effects of the restructuring of the sector will be attenuated by the implementation of accompanying socio-ecpnpmic measures envisaged by Cpmmunity regulations concerning the structural funds, and in particular by the new prpvisipns pf the FIFG regulatipn(2). Due to the Community initiative PÉSCA(3) the sector is able in all the zones dependent on fishing to make use of the measures and means of the structural funds to facilitate the restructuring of the sector. 6. The different effects of the restructuring in the different Member States The restructuring measures decided in the framework of the present proposal will have an impact on the fleets of the Member States that is a function of: the nature of their fleet; (2) (3) Council Regulation (EC) No 2719 of 20 November 1995 amending Regulation (EC) NP 3699/93 (OJ No L 283, 25. 11. 1995). Communication 94/C 180/01 to the Member States laying down the guidelines for obal grants or integrated operational programmes within the framework of a Community the fisheries sector (OJ No C 180, 1. 7. 1994). the restructuring of initiative concerning their capacity tp implement measures tp manage fishing effort; their situation with respect to the previous programmes. 6. 1. Situation linked to the nature of the fleet The dpminance pf small scale fisheries pr static gears in the typplpgy pf the fleet, particularly in the Member States in the sputh pf the Unipn, will considerably ease the impact on employment of the restructuring constraints. 6. 2. Situation resulting from the implementation of regimes to manage fishing effort The implementation of regimes to manage fishing effort equally permit the easing of the objectives of the restructuring programmes due to reductions in fishing time. Fpr a Member State in which the ecpnpmic health pf the fisheries sector justifies lihis type of measure, the reduction in employment can be minimized. 6. 3. Situation with respect to the previous programmes The objectives for restructuring are fixed in the framework pf the multiannual guidance programmes in the fprm pf capacity ceilings tp be respected by a given time limit. The efforts accpmplished in the past are taken intp account by these programmes. A Member State behind with its prpgramme will have tp make up the backlpg tp meet the pbjectives. On the pther hand, a Member State that has achieved fleet reductions that gp beypnd its pbjectives will find the pbjectives pf the next prpgramme lightened in cpnsequence. The "bpns élèves" that respected the previpus decisipns pf the Cpmmissipn cpnceming the restructuring pf their fleet will therefore have a "credit" which will make their final pbjectives easier tp achieve. 7. Coherence of the Community aid regimes and restructuring The Cpuncil adopted in December 1993 a regulation that ensures the integration of the structural measures developed in favour of fisheries into the interventions of the structural funds. In application of this regulation the Union can give aid for the elimination of fleet overcapacity and aid for its modernization, including the construction of fishing vessels. There is no doubt that the injection of public credit in a sector already considered as overcapitalized contributes to the increase in fishing effort and therefore to the aggravation of the situation in the sector. The Commission in these circumstances envisages to propose to the Council a modification of the Community structural regulation concerning structural measures that would not jeopardize the financial plans already approved up to the end of 1999. The identification of the new financial requirements necessary in the sector to ensure the restructuring can justify that: between now and 1999 the measures to adjust fishing effort and the accompanying socio-economic measures be reinforced by an internal reallocation of the resources available within the existing programmes; after 1999 new budgetary resources be identified in the context of the next period of structural fund programming. In order not to penalize segments of the fleet that respect the objectives, a proposal determining the new conditions of access to aid regimes for fleet renewal could be submitted to the Council before the end of 1996. 8. Legal base and calendar In order to ensure the implementation of means to ensure the restructuring of the sector in accordance with the objectives described above the Commission proppses tp adopt the following provisions, only the first of which is the subject of the present proposal: the adoption in September 96 by the Council of a decision with a medium term perspective of six years (1997/2002) guiding the restructuring of the fisheries sector with the view of achieving a sustainable balance between the resources and their exploitation in accordance with Article 11 of Regulation (EEC) No 3760/92(4); the adoption by the Commission by 31 December 1996 at the latest of a series of 13 decisions fixing, Member State by Member State, the objectives for the limits to capacity by segment of their fleet over the period 1997/99 in accordance with the provisions of Article 5 of Regulation 3699/92(5} on the adoption of the fourth multiannual guidance programmes (MGP IV); at the end of the MGP IV the Cpuncil cpuld be invited tp examine a new prpvisipns that respond to the exploitation conditions in the fisheries at that time. (4) (5) Article 11 of Council Regulation (EEC) No 3760/92 of 20 December 1992, establishing a Community system for fisheries and aquaculture (OJ No L 389, 31. 12. 1992). Article 5 of Council Regulation (EEC) No 3699/93 of 21 December 1993, laying down the criteria and arrangements regarding Community structural assistance in the fisheries and aquaculture sector and the processing and marketing pf its products (OJ No L 346, 31. 12. 1993). Proposal for a COUNCIL PEUSIQN concerning the objectives and detailed rules for restructuring the Commumty fisheries sector for the period from 1 January 1997 to 31 December 2002 with a view to achieving a balance on a sustainable basis between resources and their exploitation THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard tp Cpuncil Regulation (EEC) NP 3760/92 pf 20 December 1992 establishing a Cpmmunity system for fisheries and aquaculture(1), as amended by the Act pf Accessipn pf Austria, Finland and Sweden, and in particular Article 11 thereof, Having regard tp the proposal pf the Cpmmissipn(2), Having regard tp the opinion of the European Parliament^, Whereas the Community fisheries sector should be restructured in a way that takes into account the characteristics of each fishery; whereas the objectives and detailed rules for restructuring the Community fleet shpuld be fixed by fleet segment in relation tp a stpck or group of stpcks; Whereas, given the generally wprrying findings as tp the state pf the respurces accessible tp Cpmmunity vessels, reinforced by the production of a repprt by independent experts delivered by the Cpmmission to the Council on 22 April 1996(4), the Council agreed that it was necessary, over a period of time sufficiently long to afford a real remedy, to adopt precise guidelines for the adjustment of capacity and fishing effort in the various segments of the Community fleet according to a programme that takes into account the state of the various stocks pr groups pf stpcks, whilst taking intp accpunt that the Member States will npt be prevented from taking the quptas actually available; Whereas the critical state of certain stocks should be recognized; whereas the urgency of the measures to be applied to these stocks justifies a reduction in the capacity of the corresponding fleet segments that is more rapid at the beginning of the programme than at the end; Whereas the objectives and detailed rules for restructuring must take into account the fishing types and methods and their effects on the fish stocks and the marine environment; whereas it is therefore appropriate to ensure a clear distinction between tpwed gears and static gears; (1) <2) w (4) OJ No L 389, 31. 12. 1992, p. 1. OJ No C OJNoC Report of the group of independent experts to advise the European Commission on the fourth generation of multiannual guidance programmes (MGP IV). Whereas the characteristics of the power and tonnage of the vessels are the pertinent parameters as to fishing capacity for fleets using towed gears or purse seines, while such parameters are less pertinent for fleets using static gears; whereas for those gears, besides the provisions adopted in this Decision, provisions should be adopted in the framework of technical measures influencing the fishing mortality for which they are responsible; Whereas as far as static gears are concerned the reference situations vary from one Member State to another; whereas provisions should be adapted to the specific circumstances in the different Member States; Whereas it is necessary to take into account an increased efficiency in fishing attributable solely to the effect of technical progress and generally estimated to be around 2% per year for the whole of the Community fleet; Whereas the Commission organized between September 1995 and March 1996 a series of 35 regional and European consultations with the professional organizations and local groups most affected by the evolution of fishing; whereas it emerged from this wide consultation that the restructuring pf the sectpr, hpwever necessary it might be, cpuld have a spcial impact on employment in the industry, especially in the short term and on employment aboard ship; whereas, as far as possible and in addition to the socio-economic accompanying measures envisaged by Community regulations, the impact shpuld be attenuated by phasing in the measures for restructuring the sectpr; Whereas, in cases where the state pf the stocks is so critical that urgent solutions are called for, such phasing in would not be appropriate; Whereas the employment generated by the sector in areas dependent on fishing should be taken into account; whereas it is justified in the case of small-scale coastal fisheries using static gears to apply special treatment, since this activity ensures a high number of direct jobs relative to the small catches of fish; Whereas, in situations justified by the economic conditions of the exploitation of certain fleet segments and by the specific character of certain fishing activities, the reductions of fishing effort required by the state of the stocks can be achieved by a reductipn in the level pf activity pf the said segments rather than a reductipn in their capacity, provided that the Member State cpncerned dempnstrates its ability tp set up and administer fishing effort regimes by fishery; Whereas pursuant to Article 5(4) of Council Regulation (EC) No 3699/93 of 21 December 1993 laying down the criteria and arrangements regarding Community structural assistance in the fisheries and aquaculture sector and the processing and marketing of its products(5), as last amended by Regulation (EC) No 965/96(6), the Member States transmitted to the Commission information on the minimum content of the multiannual guidance programmes for the fishing fleet for the period 1997 - 1999; (5) (6) OJ No L 346, 31. 12. 1993, p. 1. OJNoL 131, 1. 6. 1996, p. 1. 10 Whereas the period 1997 - 1999 coincides with the end of the financial programming period of the sector in the framework of the structural funds; whereas the detailed rules for restructuring the sector for this period should be now be specified according to the provisions of Article 5 of the said Regulation (EC) No 3699/93; Whereas that term does not, however, correspond to a programming period long enough to ensure sufficient restructuring of the sector, and in consequence supplementary measures should be adopted in a second phase covering a supplementary period at least equal to the first; whereas this Decision does not prejudge any accompanying Cpmmunity finance for restructuring the sector that might be adopted for a peripd after 31 December 1999; Whereas the method for fixing the objectives for the reductipn pf fleet capacity shpuld take intp accpunt the efforts made in the past; whereas it shpuld be ensured that the pbjectives pf such programmes are implemented in a progressive and balanced way; Whereas the reductipns in capacity shpuld be in line with the pbjectives fixed in terms pf the progressipn pf fishing mortalities by stpck and pf effort by fishery, HAS ADOPTED THIS DECISION: Article 1 1. The capacities of segments of the fishing fleet of each Member State shall be diminished according to the percentage reductions in fishing effort required by stock or group of stocks and within the deadlines set out in the Annex. 2. When a segment of the fleet fishes several stocks or groups of stocks, the reductipn applied shall be the highest percentage reductipn in fishing effort cprresppnding tp the mpst sensitive stpck. 3. The segmentation pf the fleet pf each Member State shall be determined accprding to the procedures under Article 18 of Regulation (EEC) No 3760/92 in relation to the stocks or groups of stocks defined in the Annex hereto and taking into account the segmentation adopted as part of the third multiannual guidance programme. 4. A segment of the fleet shall be defined as a homogeneous group of vessels for which the fishing activities are similar. A segment shall be polyvalent if it is composed of vessels using alternatively towed gear, static gear, or gear of a different nature. A vessel shall be classified as polyvalent on the basis of information provided to the Commission on the basis of Commission Regulation (EC) No 109/94(7), and in particular Annex 1, Table 2 thereof. (7) O J N oL 19,22. 1. 1994, p. 5, 11 Article? In accordance with the procedures defined in the framework of Regulation (EC) No 109/94 concerning the fishing vessel register of the Commumty: 1. 2. 3. the capacities pf segments composed pf vessels using towed gears and purse seines are expressed at least in tonnage GT and tptal installed power kW; the capacities pf segments composed of vessels using static fixed or floating gears are expressed at least in number of vessels and tonnage GT; the capacities of mixed segments composed of vessels using alternately tpwed gears and static gears are expressed at least in tonnage GT, total installed power kW and number pf vessels. Article 3 In each Member State the fleet segment composed pf fishing vessels pf less than seven metres in overall length and not equipped for fishing with towed gears shall be exempt from the provisions of Article 1. Any increase in the capacity of this segment expressed in tonnage GT and in number of vessels accprding to the data collected pursuant to Regulation (EC) No 109/94 shall be prohibited from 1 January 1997 until 31 December 2002. Article 4 1. Each Member State shall adopt the measures necessary to constrain the evolution of fishing effort, as defined by point (f) of Article 3 of Regulation (EEC) No 3760/92, exercised by fleet segments using static gears within the limits and deadlines specified in the Annex hereto. The proposed measures, the effect of which must be that the required reductions in capacity result in equivalent reductions in fishing effort, shall be submitted to the Commission for approval by 30 June 1997 at the latest. 2. Any Member State may propose, according tp the prpcedure under Article 4 pf Regulation (EC) 109/94, a programme to limit fishing effort, including measures regulating fishing activity, for the segments of the fleet cpvered by Article 2 pf this Decisipn. Where the Cpmmissipn decides tP accept such a prpgramme it shall determine, in its decisipn pf acceptance, tp what extent and under what cpnditipns the implementation of the said programme wpuld result in the pbligatipns to reduce capacity in the Member States concerned being eased within the framewprk of the decisions covered by Article 5(2) of Regulation (EC) NP 3699/93. Article 5 The segments of the fleet affected by fisheries management recommendations issued by international organizations approved by the Community or the Member States and, if necessary, the segments of the fleet covered by fishing agreements concluded between the Community and third countries, shall be identified and their capacities adjusted by the Commission on the basis of this Decision, in line with the objectives fixed by those recommendations and the fishing opportunities defined by the agreements. 12 Article ft 1. The implementation of the objectives and the detailed rules of this Decision shall be carried. out by the Commission in two phases, the first of which shall be for the period from 1 January 1997 to 31 December 1999 within the framework of the provisions of Article 5 of Regulation (EC) NP 3699/93 concerning the multiannual guidance programmes for the fishing fleets. It is within this framework that the segmentation of the fleet and the detailed rules fixing the objectives by segment as a function of the objectives fixed by the previous programmes shall be adopted. 2. The target reductions in capacity by fleet segment, fixed accprding tp the percentages in Annex I covering phase I (1997 - 1999) shall be achieved by 31 December 1999 at the latest. 3. The target reductions in capacity by fleet segment fixed according to the percentages in Annex I covering phase II (2000 - 2002) shall be achieved by 31 December 2002 at the latest. To this end the Member States shall transmit to the Cpmmissipn by 1 January 1999 at the latest the information set put in Annex II to Regulation (EC) NP 3699/93 adapted pn the pccasipn fpr the peripd 1999/2002. The Scientific, Technical and Economic Committee for Fisheries established by Article 16 of Regulation (EC) No 3760/92 shall provide by 1 January 1999 at the latest a report on the evolution of fish stocks and of fisheries. On the basis pf that informatipn the Cpuncil may, accprding tp the prpcedure of Article 43 of the Treaty, revise the guidelines that it has fixed in this Decision. 4. Any other decision necessary for the implementation of this Decisipn shall be taken accprding tp the prpcedure under Article 18 pf Regulation (EEC) NP 3760/92. Article 7 For the period from 31 December 2002, the objectives and detailed rules envisaged in Article 11 of Regulation (EEC) No 3760/92 shall be fixed by the Council by 30 June 2002 at the latest. This Decision is addressed to the Member States. Article 8 Done at Brussels, For the Cpuncil The President 13 ANNEX relative to the pilot redaction rates for the restructuring of the fishing fleet during the period from 1 January 1997 to 31 December 2002 The percentages shown in the maritime region tables fix reductions in fishing effort by stock or groups of stocks for phase 1 (1997/1999), phase II (2000/2002) and for the whole period (1997/2002). These percentages apply to the segment capacity ceilings at 31 December 1996 fixed in Commissipn Decisions 95/238/EC to 95/248/EC of 7 June 1995(8) cpnceming the third multi-annual guidance programmes fpr the peripd 1993 - 1996. These ceilings will be converted according to fleet remeasurement procedures, collection of data on power installed on board, and possibly the revision of segmentation of the fleet should this exercise prove to be necessary to take into account pilot reduction rates in the present annexe. 1. Pilot reduction rates applicable to segments using fixed gear in all the maritime regions as well as segments not targeted by those tables under point 2 I II stocks phase 1 (1997 - 1999) phase II (2000 - 2002) tptal for the period All stocks except salmon salmon 6% 30% 6% 20% 12% 50% 2. Pilot reduction rates applicable to segments using trawls, purse seines or composed of polyvalent vessels by maritime region: (based on the numbered divisions established by the international Cpuncil for the exploration of the sea: ICES and NAFO). The fleet segments not identified with the stpcks targeted by the tables belpw but indicated by maritime area and by type pf demersal fishery, benthic and pelagic, industrial fishing and fishing fpr deep water species will be subject to a general capacity reductipn pf 12 % in twp equal parts pf 6 % for each phase Baltic Sea (HI b, c, d) stocks demersal pelagic phase 1 (1997 - 1999) phase II (2000 - 2002) total for the period 30% 0% 10% 0% 40% 0% (8) O J N PL 166, 15. 7. 1995. 14 Kattegat-Skagerrak (m a), North Sea (IV), Eastern Channel (VH d) and West Scotland (VI) stocks demersal flatfish shrimps phase 1 (1997 - 1999) phase II (2000 - 2002) total for the seriod 30% 20% 15% 20% 10% 10% 15% 20% I 40% 30% 30% 40% i '• ' ' i t- Southern plateau, (Vit except VII a, d, VIII a, h) stocks j | demersal S flatfish pelagic except for anchovy and tuna Irish Sea (VII a) 1 ' stocks , L^ , U - J— phase 1 (1997 - 1999) phase II (2000 - 2002) total for the period 30% 20% 20% 10% 10% 20% 40% 30% 40% i 1 i '•' phase 1 (1997 - 1999) phase II (2000 - 2002) total fpr the peripd | all stocks 30% 10% 40% Off the Spanish and Portuguese coasts (VIII c, and IX a) stocks phase 1 (1997 - 1999) phase II (2000 - 2002) tptal for the period swprdfish,hake and monkfish sardine deep water species 30% 30% 40% 40% 0% 10% 10% 15 Mediterranean stocks small pelagics demersal swordfish red tuna NAFO, NEAFC phase 1 (1997 - 1999) phase II (2000 - 2002) total for the period 0% 20% 20% 20% -> 0% 10% 10% 10% 0% 30% 30% 30% stocks phase 1 (1997 - 1999) phase II (2000 - 2002) total for the period all except pelagic 30% 10% 40% Tropical tuna stocks phase 1 (1997 - 1999) phase II (2000 - 2002) total for the period tropical tuna 0% 0% 0% 16 ISSN 0254-1475 COM(96) 237 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-259-EN-C ISBN 92-78-05136-5 Office for Official Publications of the European Communities L-2985 Luxembourg 17