RESTRICTED
WT/TPR/S/317
18 May 2015
(15-2598)  Page: 1/212
Trade Policy Review Body  
 
 TRADE POLICY REVIEW 
REPORT BY THE SECRETARIAT 
THE EUROPEAN UNION 
This report, prepared for the twelfth Trade Policy Review of the European Union, has been drawn 
up by the WTO Secretariat on its own responsibility. The Secretariat has, as required by the Agreement establishing the Trade Policy Review Mechanism (Annex 3 of the Marrakesh Agreement 
Establishing the World Trade Organization), sought clarification from the European Union on its 
trade policies and practices.  Any technical questions arising from this report may be addressed to Messrs John Finn 
(tel: 022 739 5081), Pierre Latr ille (tel: 022 739 5266), Xinyi Li  (tel: 022 739 5579), Roger Kampf 
(tel: 022 739 6218).  
Document WT/TPR/G/317 contains the policy statement submitted by the European Union. 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Re view Body on the European Union. This report 
was drafted in English. WT/TPR/S/317 • European Union 
 
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  CONTENTS 
SUMMARY ....................................................................................................................... . 8 
1   ECONOMIC ENVIRONMENT ........................................................................................ 11  
1.1   Recent Econ omic Developments.................................................................................. 11 
1.1.1   Overview of GDP growth ......................................................................................... 11 
1.1.2   Struct ural reforms ................................................................................................. 13 
1.1.2.1   Fiscal gove rnance impr ovement ............................................................................ 13 
1.1.2.2   Labour market re forms ........................................................................................ 14 
1.1.2.3   Current account im balance ................................................................................... 16 
1.2   Trade Performance ................................................................................................... 17 
1.2.1   Intra-EU trade ....................................................................................................... 17 
1.2.2   Extr a-EU tr ade ...................................................................................................... 18 
1.3   Foreign Dire ct Invest ment ......................................................................................... 23 
2   TRADE AND INVE STMENT RE GIME ............................................................................ 26  
2.1   Legal and Inst itutional Fr amework .............................................................................. 26 
2.2   Trade Policy Object ives and Cons ultation ..................................................................... 27 
2.3   Trade Agreements and Arrangements .......................................................................... 28 
2.3.1   WTO ................................................................................................................... . 28 
2.3.2   Regional and pr eferential agreements ....................................................................... 29 
2.3.2.1   Reciproc al preferences ......................................................................................... 29 
2.3.3   Unilateral preferences ............................................................................................ 30 
2.4   Investme nt Regime .................................................................................................. 32 
2.4.1   Busine ss enviro nment ............................................................................................ 32 
2.4.2   Foreign investment regime ...................................................................................... 33 
2.5   Aid for Trade ............................................................................................................ 34 
3   TRADE POLICIES AND PRACTICES BY MEASURE ........................................................ 35  
3.1   Measures Direct ly Affectin g Imports ............................................................................ 35 
3.1.1   Customs procedures ............................................................................................... 35 
3.1.2   Custom s valuation ................................................................................................. 38 
3.1.3   Rules of origin .......................................................................................................  39 
3.1.3.1   Non-preferential rules .......................................................................................... 39 
3.1.3.2   Preferential rules ................................................................................................. 39 
3.1.4   Tariffs ............................................................................................................... ... 41 
3.1.4.1   WTO bound tariffs ............................................................................................... 41 
3.1.4.2   M FN tari ffs .........................................................................................................  41 
3.1.4.3   Tariff suspension s and tariff ra te quotas ................................................................. 44 
3.1.5   Internal taxes collected at the border on imports ........................................................ 45 
3.1.6   Import contro ls and rest rictions ............................................................................... 45 
3.1.7   Continge ncy measures ........................................................................................... 46 
3.1.7.1   Overview ........................................................................................................... 46 WT/TPR/S/317 • European Union 
 
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  3.1.7.2   Anti-dumping  and counter vailing ........................................................................... 47 
3.1.7.3   Safeguards ........................................................................................................ 50 
3.1.8   Technical regu lations and standards ......................................................................... 50 
3.1.9   Sanitary and ph ytosanitary measures ....................................................................... 55 
3.1.9.1   Live animals and animal products .......................................................................... 57 
3.1.9.2   Plants an d plant pr oducts ..................................................................................... 58 
3.1.9.3   Rapid Alert Syst em for Food and Feed .................................................................... 58 
3.1.9.4   The SPS Co mmittee of the WT O ............................................................................ 59 
3.2   Measures Directly Affecting Exports ............................................................................. 59 
3.2.1   Export procedur es and requirements ........................................................................ 59 
3.2.2   Export taxes, charges, an d levies ............................................................................. 59 
3.2.3   Export prohibitions, restrictions, and licensing ............................................................ 59 
3.2.3.1   Dual-use items export control regime ..................................................................... 59 
3.2.4   Export credit, in surance, and promotion .................................................................... 61 
3.2.5   Waste shipme nt trade regime .................................................................................. 62 
3.2.6   Diplomat ic measures .............................................................................................. 62 
3.3   Measures Affectin g Production and Trade ..................................................................... 64 
3.3.1   Subsidies .............................................................................................................. 64 
3.3.1.1   EU level support ................................................................................................. 64 
3.3.1.2   State aid ............................................................................................................ 65 
3.3.1.3   Public service obligations and services of general economic interest............................ 70 
3.3.1.4   Crisis-r elated state aid ......................................................................................... 71 
3.3.2   Competition policy  and regulato ry issues ................................................................... 73 
3.3.2.1   Overview ........................................................................................................... 73 
3.3.2.2   Antitr ust ........................................................................................................... . 73 
3.3.2.3   Mergers and acquisitions ...................................................................................... 78 
3.3.2.4   Internat ional cooperation ..................................................................................... 79 
3.3.3   Ta xation  .............................................................................................................. . 80 
3.3.3.1   In come tax ........................................................................................................ 81 
3.3.3.2   Corporation tax ................................................................................................... 82 
3.3.3.3   Value added tax .................................................................................................. 83 
3.3.3.4   Excise duties ...................................................................................................... 85 
3.3.3.5   Vehicle tax .........................................................................................................  85 
3.3.4   State enterprises ................................................................................................... 85 
3.3.5   Governme nt procurement ....................................................................................... 87 
3.3.5.1   GPA and inte rnational pr ocurement........................................................................ 94 
3.3.5.2   Other developments ............................................................................................ 95 
3.3.6   Intellectual property rights ...................................................................................... 96 
3.3.6.1   Copyright and related rights ................................................................................. 98 
3.3.6.2   Industri al property ............................................................................................ 102  WT/TPR/S/317 • European Union 
 
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  3.3.6.3   Enforcement ..................................................................................................... 112  
4   TRADE POLICIES BY SECTOR ................................................................................... 119  
4.1   Introduction ........................................................................................................... 119  
4.2   Agriculture ............................................................................................................ 119 
4.2.1   Agriculture in the European  Union .......................................................................... 119  
4.2.2   Trade .................................................................................................................  121 
4.2.3   Agricultural policies .............................................................................................. 12 2 
4.2.3.1   Domest ic support .............................................................................................. 123  
4.2.3.2   Export subsidies................................................................................................ 132  
4.2.3.3   Market access ................................................................................................... 132  
4.2.4   Domestic support le vels ........................................................................................ 133  
4.2.4.1   WTO no tifications .............................................................................................. 133  
4.2.4.2   OECD monitoring and evalua tion of agricultur al policies .......................................... 133  
4.3   Services ................................................................................................................  136 
4.3.1   Telecommunications services ................................................................................. 136  
4.3.1.1   Statistical overview ........................................................................................... 136  
4.3.1.2   Regulatory framewor k and policy de velopments .................................................... 139  
4.3.2   Audiovisual services ............................................................................................. 144  
4.3.2.1   Statistical overview ........................................................................................... 144  
4.3.2.2   Regulatory regime ............................................................................................. 147  
4.3.3   Distribution services ............................................................................................. 154  
4.3.3.1   Statistical overview ........................................................................................... 154  
4.3.3.2   Regulato ry framew ork ....................................................................................... 157  
4.3.4   Financial services ................................................................................................. 159  
4.3.4.1   Legislations aimed at building new rules for the global financial system ..................... 160  
4.3.4.2   Legislations aimed at establishing a safe, responsible and growth enhancing 
financial sector in Europe ................................................................................................ 163  
4.3.4.3   Legislations aimed at completing the Banking Union to strengthen the Euro ............... 167  
REFERENC ES ................................................................................................................ 169  
5   APPENDIX TABLES .................................................................................................. 171  
 
CHARTS 
 Chart 1.1 GDP growth rate of selected EU me mbers, 2011-14  ................................................ 11
 
Chart 1.2 Growth rates of GDP and exports, 2010-13 ............................................................ 12 
Chart 1.3 EU-28 GDP growth and co mponents' contri butions,  2008- 14 .................................... 12 
Chart 1.4 Cumulative growth of net earnings – nominal and adjusted for HICP inflation, 
2010-1 4 ....................................................................................................................... .. 15 
Chart 1.5 Nominal unit labour  costs (index),  2010 and 2013 .................................................. 16 
Chart 1.6 Current account and trade bala nce as a share of GDP, 2011Q1- 2014Q3 ..................... 16 
Chart 1.7 EU-28 trade volume (index), 2008Q1-2014Q3 ........................................................ 17 WT/TPR/S/317 • European Union 
 
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  Chart 1.8 Intra- and extra-EU exports, 2010 and 2013 .......................................................... 18 
Chart 1.9 Direction of merchandise trade, 2010 and 2013 ...................................................... 19 
Chart 1.10 Composition of merc handise trade,  2010 and 2013 ............................................... 21 
Chart 1.11 FDI and labour pr oductivity gr owth, 2003- 12 ....................................................... 25 
Chart 3.1 Anti-dumping measures in force, by region, 2010-14  .............................................. 48 
Chart 3.2 Anti-dumping measures in force, by product,  2010- 14............................................. 49 
Chart 3.3 State aid (including railway support transport for pensions and public service 
obligations), 2013 ............................................................................................................ 69 
Chart 4.1 Exports and imports of agricultural products, 2004-13 ........................................... 121  
Chart 4.2 Domestic support in  the EU, 2002/0 3–2011/1 2 .................................................... 134  
Chart 4.3 Support estimates for ag riculture in th e EU, 2003- 13 ............................................ 135  
Chart 4.4 EU-28 major extra-EU trading part ners of telecommunica tions services ................... 137  
Chart 4.5 EU-28 major extra-EU trading partne rs of other royalties and licence fees ................ 145  
Chart 4.6 EU-28 major extra-EU trading partners of merchanting and other trade-related 
services ........................................................................................................................ 156  
 
TABLES 
 
Table 1.1 Extra-EU trade in services , components and partners, 2012-13 ................................ 22 
Table 1.2 Foreign direct investment fl ows, 2013 ................................................................... 24 
Table 3.1 Structure of MFN tariffs in the EU-28, 201 1, 2013 an d 2014  ..................................... 42 
Table 3.2 Summary statisti cs of MFN ta riffs, 2014 ................................................................ 43 
Table 3.3 Anti-dumping investigatio ns and measures imposed, 2010-14  .................................. 48 
Table 3.4 Countervailing investigatio ns and measures imposed, 2010-14 ................................. 49 
Table 3.5 Legal basis for technical requiremen ts, standards, conformity assessment, and 
accreditation in the EU at end-2014 .................................................................................... 51 
Table 3.6 Harmonized standard s in the EU, De cember 2014 ................................................... 52 
Table 3.7 RAPEX reporting 2010-14 .................................................................................... 55 
Table 3.8 Principal SPS legi slation in th e EU in  2015 ............................................................. 56 
Table 3.9 RASFF noti fications,  2011- 14 ............................................................................... 58 
Table 3.10 Changes to EU rule s on state aid,  2013 and 2014 ................................................. 66 
Table 3.11 Non-crisis-related state aid in the EU, 2008-13 ..................................................... 69 
Table 3.12 Use of crisis-related aid in  selected EU memb er States , 2008- 13 ............................. 72 
Table 3.13 Approved and prohibited mergers, 2013 and 2014 ................................................ 78 
Table 3.14 Tax and social contri butions in the EU-28, 2007-12  ............................................... 80 
Table 3.15 Income tax and employee social contributions in the EU ......................................... 81 
Table 3.16 Corporation tax and employer social contributions ................................................. 83 
Table 3.17 VAT in the EU .................................................................................................. 84 
Table 3.18 State-owned enterprises in selected member States end-2012180 ............................ 86 
Table 3.19 Minimum public proc urement thresh olds, 2014 -15 ................................................ 88 
Table 3.20 Publication rate in terms of GDP and total expenditure on works, goods and 
services (excluding utilities), 2012-13 ................................................................................. 93 WT/TPR/S/317 • European Union 
 
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  Table 3.21 EU procurement and GPA key figures, 2009-11 ..................................................... 95 
Table 3.22 Contribution of the IP- indust ries to EU employment, GDP and trade and 
average wage premium of IP-intensive industries, 2008-10 .................................................... 97 
Table 3.23 Overview of selected  IP enforcemen t measur es .................................................. 113  
Table 3.24 Enforcement of intellec tual property rights, 2011-13 ........................................... 115  
Table 4.1 EU-28, value of agricultural output, 2007-14 ........................................................ 120  
Table 4.2 Imports of agricultural products, 2008-13 ............................................................ 121  
Table 4.3 Exports of agricu ltural produc ts, 2008-13  ............................................................ 122  
Table 4.4 Direct payments to agricultural producers in the EU, 2007/08-2011/12 .................... 123  
Table 4.5 Net amounts for direct paymen ts, 2013- 19 .......................................................... 124  
Table 4.6 Crop-specific payments fo r cotto n....................................................................... 126  
Table 4.7 Intervention and private stor age aids in the EU , 2009/10-2013/ 14 .......................... 127  
Table 4.8 Intervention and pr ivate storage aid, 2015 .......................................................... 128  
Table 4.9 National envelopes for rural development, 2014-20 ............................................... 131  
Table 4.10 OECD indicators for support to agriculture in the EU, 2 007-13 .............................. 135  
Table 4.11 Telecommunications services main economic in dicators, 2010-12 .......................... 136  
Table 4.12 EU-28 major extra EU trading partners of telecommunications servicesa, 2012 ........ 138  
Table 4.13 Selected telecommunication s indicators for EU-28, 2010-13 ................................. 138  
Table 4.14 Revenues and investment in the electronic communications sector, 2010-12 ........... 138  
Table 4.15 Motion picture, radio, television  and other entertainment activities main 
economic indicatorsa, 2010-12  ......................................................................................... 144  
Table 4.16 EU-28 major extra-EU trading partners of other royalties and licence feesa, 
2012 146  
Table 4.17 Broadcasters' net revenues,  2009-1 3 ................................................................ 146  
Table 4.18 Consumer expenses for audiovisual distribution services (incl. taxes)a, 2009-13 ...... 146  
Table 4.19 VoD online revenues, 2009-13 ......................................................................... 147  
Table 4.20 Overview of promotion of European content measures adopted by member 
States for video-on-d emand services ................................................................................ 149  
Table 4.21 National audiovisual support regimes overview ................................................... 152  
Table 4.22 Wholesale and retail trade; repair of motor vehicles and motorcycles main 
economic indicators, 2010-12a ......................................................................................... 155  
Table 4.23 EU-28 major extra-EU trading partners of merchanting and other trade-related services
 a, 2012 ............................................................................................................. 156  
 
BOX 
 Box 3.1 Voluntary pledges by the copyright industry ........................................................... 100
 
 
APPENDIX TABLES 
 Table A1.1 GDP growth rates of  EU member St ates, 2012- 14 ............................................... 171
 
Table A1.2 GDP growth and components contributions, 2008-14 ........................................... 172  
Table A1.3 Import volume (index), 2007-13a ..................................................................... 175  WT/TPR/S/317 • European Union 
 
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  Table A1.4 Export volume (index), 2007-13a ...................................................................... 176  
Table A1.5 Intra-EU merchandise tr ade by product gr oups, 2010- 13 ..................................... 177  
Table A1.6 Merchandise export s by destinatio n, 2010-13  ..................................................... 178  
Table A1.7 Merchandise exports by product group, 2010-13 ................................................. 179  
Table A1.8 Merchandise imports by origins, 2010-13 ........................................................... 180  
Table A1.9 Merchandise import s by product gr oups, 2010- 13 ............................................... 181  
Table A1.10 Inward FDI stocks , 2013 ............................................................................... 182  
 
 Table A2.1 Selected notifications to  the WTO, January  2013-March 2015 ............................... 183
 
Table A2.2 Status of dispute-related WTO matters involving the EU, March 2013–February 
2015  ......................................................................................................................... . 186  
 
Table A3.1 Tariffs under prefer ential agreements (2014) ..................................................... 190  
Table A3.2 Contingency measures , January 2007-Nove mber 201 4 ........................................ 191  
Table A3.3 Official export credit agen cies of the EU memb er States , 2014 .............................. 201  
Table A3.4 Tax and social contri butions in the EU in 2012 .................................................... 203  
Table A3.5 Summary of the main legislation on intellectual property rights, 2015 .................... 204  
Table A3.6 Term of protection of majo r intellectual proper ty rights , 2015 ............................... 207  
 
Table A4.1 Implementation of direct payments in the EU in 2015 .......................................... 210  
Table A4.2 Voluntary coupled support – member States and sectors supported (claim year 
2015)  ........................................................................................................................ .. 212  
 
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  SUMMARY 
1. Overall, the EU remains an open and transp arent economy and, as one of the biggest 
economies and trading entities in the world, plays a critical role in the multilateral trading system. Croatia became the 28
th member State of the EU in July 2013. Although each member State has 
varying degrees of competence in several areas that affect trade and investment, such as taxation, 
the EU has exclusive competence for trade an d investment and the EU economy is highly 
integrated and functions as a single market. Extra-EU trade is critical to the economy, with trade 
in goods and services equivalent to about 35% of EU GDP in 2013. Furthermore, exports have 
continued to grow as they increased in both nominal and real terms since 2009. On the other hand, the value of imports declined in 2013 relative to 2012. 
2. Since the last Trade Policy Review of the EU in 2013, developments have continued to be 
dominated by low and fragile growth, with no in crease in GDP in 2013 and 1.3% in 2014, and by 
the evolution of the monetary crisis in the euro area. The main macroeconomic indicators of most 
member States have improved, but some member States have seen only modest improvements. 
Furthermore, unemployment remains high, investment has been stagnant, and inflation has 
slipped into deflation in some periods. As a result, in early 2015, the European Central Bank began a period of monetary easing through its expanded asset purchase programme  which has been 
extended to include bonds issued by euro area central governments, agencies, and European 
institutions. Combined monthly asset purchases are to amount to €60 billion and the intention is to continue the programme until at least September 2016. In addition, the Commission has initiated an Investment Plan for Europe which includes a European Fund for Strategic Investments to 
support the real economy. The Pl an aims to mobilize an addition al €315 billion in the period 2015-
17 for strategic investments, such as in infrastructure. At the member State level, labour market reforms have also started to produce results with some improvements in employment, which is 
partly the result of lower earnings in some member States. 
3. Although the focus of EU policy has been on macroeconomic developments, trade and trade-
related policies have continued to evolve. The EU is engaged in trade negotiations with some 
trading partners, particularly the United States and Japan, and has concluded negotiations with 
others, including Canada. It has also continued to apply its GSP and GSP+ schemes for developing and its everything-but-arms scheme for least developed countries. The cumulative effect of the various preferential arrangements already in place or under negotiation would mean that only a 
few countries and territories will be trading with the EU on an MFN basis (although the GSP does 
not cover all products for all beneficiaries). Furt hermore, the EU's deep and comprehensive trade 
agreements and its economic partnership agreements go beyond basic terms for trade in goods 
and services and include trade-related policies in areas such as investment, non-tariff barriers, and 
intellectual property. 
4. In the WTO, the EU has continued to be on e of the most active Members and has often 
stated its commitment to concluding the DDA. The EU, along with the member States, contributes 
a significant amount to aid for trade. At end- March 2015, the process of ratification of the 
Agreement on Trade Facilitation was under way in the EU. 
5. There are significant differences among member States in the time and cost required to 
import and export but this is mainly due to differences in non-customs related factors, such as 
infrastructure, rather than customs procedures  and requirements. Furthermore, the EU is 
implementing an electronic customs initiative that includes an automatic import/export system and 
single window, which will help to further reduce  the time needed to process documentation. In 
addition, the system of authorised economic op erators has continued to expand and the network 
of mutual recognition agreements for AEOs now includes China. On the other hand, the growing 
number of preferential trade agreements and schem es between the EU and other trading partners 
requires a considerable body of law on rules of origin. 
6. The MFN tariff profile of the EU has not ch anged over the past two years as the small 
changes to the simple average tariff are a reflection of changes in ad valorem  equivalents of non-
ad valorem  tariffs caused by changes in unit prices. Therefore, the average tariff remains at 6.5% 
with considerable differences from one product group to another: nearly one quarter of tariff lines are duty free; while agricultural products have a higher average level of protection and greater 
variation from one tariff line to another. WT/TPR/S/317 • European Union 
 
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  7. At end-November 2014, the EU had a total of 108 anti-dumping and 14 countervailing 
measures in force while it has not applied any safeguard measures since 2008. However, at 16, the number of anti-dumping investigations initiated during the review period was about half the number in the previous two years although the number  of countervailing duty investigations, at 6, 
remained about the same. 
8. The process of harmonization of EU standards and technical requirements has continued 
with the Alignment Package of eight directives in February 2014, which included directives on low 
voltage electrical equipment and electromagnetic compatibility. In addition, other legislation 
adopted in 2013 and 2014 covered alignments of standards in other areas, including radio equipment and recreational craft. Although ther e have been no major changes in sanitary and 
phytosanitary measures, the Commission has adopted a proposal for a package of measures 
affecting the agri-food chain. 
9. Export credits and other supports to industry and services provided by the member States 
fall under EU rules on state aid. Although state aids which favour certain undertakings or the 
production of certain goods are, in principal, proh ibited by the Treaty on the Functioning of the EU, 
there are a number of exemptions and exceptions  and specific rules for services of general 
economic interest. These state aid rules are under going reform based on the Communication from 
the Commission on State Aid Modernisation that aims to streamline the rules, allow better 
targeting, and improve enforcemen t. The overall trend for the total level of state aids has been 
declining for several years although the total, at over €62 billion (excluding transport), remains significant. In addition to regular state aids, state aids related to the financial crises that started in 
2008 continued to be used in 2013 and 2014 and the rules were revised in the 2013 Banking 
Communication from the Commission. Effective use of crisis-related aid has been much less than the amounts approved by the Commission: authorization for guarantees reached €3,893 billion; 
but outstanding guarantees peaked at €835.8 billion in 2009; and, as at October 2014, called-in 
guarantees were €3.1 billion. 
10. To a large extent, direct taxes are the responsibility of the member States, and the systems 
and rates of income tax, corporation tax, and social contributions vary from one to another. 
Overall, the high level of social contributions by employers relative to profits may act as a 
disincentive to job creation. Although there is a common system and a minimum standard rate for value added tax there remains a considerable amount of flexibility in the rules and derogations 
from the rules which "prevent a coherent system of VAT rates in the EU from being applied". 
11. There are common rules on government procurement that are applicable through the EU, 
but differences in the data provided by member States make it difficult to draw conclusions about 
spending in one State compared to another. A series of new directives were agreed in 2014 which 
have reformed the legal framework and their provisions are being transposed into national laws in the member States. The package is intended to  improve transparency and enforcement, and 
simplify procedures. Among other changes, the package reinforces rules on aggregation of below-
threshold procurement contracts, introduces the concept of life-cycle costing that includes environmental externalities, and applies specific rules to concessions contracts. 
12. Intellectual property is very important to the EU economy and a main driver of growth that 
is governed by an extensive body of legislation at  both the EU and member State levels. At the EU 
level, under the 2011 Blueprint for intellectual property rights, the Framework Programme for 
Research and Innovation for 2014-2020, and other official papers, the review and modernisation of 
legislation has continued with several directives which are being transposed into national laws in 
the member States. Preparatory work for the implementation of the unitary patent package has also followed its course. In addition, the review of the EU trademark regime and consideration of a 
proposed directive on the protection of trade secr ets are well advanced. The Court of Justice of the 
EU has continued to develop its jurisprudence in several key areas of intellectual property rights, including by clarifying the patentability of human stem cells. 
13. The Common Agricultural Policy underwent significant reform with the adoption of several 
directives and implementing rules covering direct  payments to agricultural producers, market 
measures, and rural development while export refunds for all agricultural products were set at zero from July 2013. Although the reform in the CAP may reduce distortions to production in the 
EU, the total funding for agriculture and rural development will remain over €50 billion a year. 
Furthermore, as with earlier reforms, market acce ss measures, including tariffs, tariff quotas, and WT/TPR/S/317 • European Union 
 
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  the use of the special agricultural safeguard are no t directly affected and, therefore, agricultural 
producers will continue to be insulated from changes in international prices. 
14. In the aftermath of the global financial crisis, legislative reform affecting the financial sector, 
particularly prudential measures, has continued under three pillars: rules for global banking; rules 
aimed at establishing a safer and growth enhancing financial sector; and rules aimed at completing 
banking union to strengthen the Euro. Several directives and regulations have been introduced under each pillar with proposal s for more from the Commission. 
15. In telecoms, the transposition into national laws of the regulatory framework described in 
previous Reviews has been completed while related rules have been adopted at the EU level. Further legislative changes under the Connected Continent Package were proposed by the Commission in September 2012 and are under discussion in the Parliament and Council. 
16. Distribution services are one of the largest se rvices sectors in the EU with wholesale and 
retail trade accounting for over 11% of GDP and ne arly 15% of employment in the EU. The sector 
is characterized by increasing concentration and vert ical integration. To a large extent, distribution 
services are regulated by the member States through a combination of laws, including those 
relating to labour, competition, and establishment. However, several EU level laws are applicable, including the Services Directive and, in recognition of the importance of distribution services to the 
EU economy and to the operation of internal market policy, further EU policies are currently being 
developed. 
17. Audiovisual services along with other creative industries, contribute about 2.6% to the GDP 
of the EU. The principal rules regulating the sect or are the Audiovisual Media Services Directive 
and two communications from the Commission on control of state aid to public broadcasters, and 
supports for films and other audiovisual works. 
18. As noted in the previous Trade Policy Review, the EU is a highly integrated economic unit 
with common policies and laws covering most trade-related areas. Furthermore, integration is 
increasing and, despite macroeconomic and fiscal problems affecting some member States, overall the EU has an open and transparent trade and investment regimes. However, the economic 
recovery remains fragile and there remain signific ant differences among the 28 member States in 
some policy areas, including direct taxation, st ate enterprises, fiscal policy, and government 
procurement, all of which affect trade and investment. 
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  1  ECONOMIC ENVIRONMENT 
1.1  Recent Economic Developments 1.1.1  Overview of GDP growth 1.1.  During the period under review (2013-14), the EU's recovery from the global financial crisis 
has been slow and fragile but improving; with  EU GDP expected to grow by 1.3% in 2014 
compared to zero in 2013; and economic growth in the euro-area expected to be 0.8% in 2014, 
compared to a contraction of 0.5% in 2013. 
1.2.  The EU's recovery from the crisis began in 2013Q2. Despite low growth rates in 2014, most 
EU member States were out of recession except for Croatia, Cyprus, Finland, and Italy (Table A1.1). Among the member States, Ireland's growth was the strongest with year-on-year rates of 7.3% in 2014Q2 and 3.5% in 2014Q3.
1 The main EU economies followed different paths; 
growth in the United Kingdom has been relatively strong and accelerated since 2014Q2; after 
recovering strongly in 2014Q1, the German economy slowed down considerably; France has been in a protracted period of stagnation; Spain exited recession in 2014; and although Italy's GDP 
continued to shrink it was at a slower pace than before (Chart 1.1). Member States in the central 
and eastern EU continued to grow during the review period, with Poland being the only country exhibiting positive growth during the crisis and thereafter. 
Chart 1.1 GDP growth rate of selected EU members, 2011-14 
(%) 
-12.0-10.0-8.0-6.0-4.0-2.00.02.04.06.08.010.02010Q12010Q22010Q32010Q42011Q12011Q22011Q32011Q42012Q12012Q22012Q32012Q42013Q12013Q22013Q32013Q42014Q12014Q22014Q32014Q4DEU
IRL
GRC
ESP
FRA
ITA
LVA
POL
PRT
GBR
 
Note: Year-on-year rate. Data not seasonally ad justed. No data available for Ireland, 2014Q4. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
1.3.  Exports, including intra- and extra-EU exports, provided cushions for economic downfalls in 
the EU and its member States. In particular, it wa s a major pulling force of growth in the period 
2010-13 (Chart 1.3). Among the member States, a strong positive correlation between GDP and 
export growth is found in the Baltic countries, countries in central and eastern EU (e.g. Poland) as well as the U.K. (Chart 1.2). Net exports in Greece, Spain, and Italy were the only positive 
contributor to GDP growth (Table A1.2). However, the Commission estimated that the effect of net 
exports on growth is diminishing
2, in view of the uncertainties lingering around external demands 
as well as expected import growth with a rebound in domestic demand (see below). 
                                               
1 Ireland successfully exited the IMF/EU/ECB programme of assistance on 16 December 2013. 
2 European Commission (2015), European Economic Forecast, Winter 2015 . Viewed at: 
http://ec.europa.eu/economy_finance/publications/european_economy/2015/pdf/ee1_en.pdf . WT/TPR/S/317 • European Union 
 
- 12 - 
 
  Chart 1.2 Growth rates of GDP and exports, 2010-13 
Average annual growth rates, % 
BELBGR
CZE
DNKDEUEST
IRLGRC
ESP
FRA
HRVITACYP
LVA
LTU
LUXHUN
MLTNLDAUTPOL
PRTROU
SVNSVK
FIN
SWEGBR
-5.00.05.010.015.0
-8.0 -6.0 -4.0 -2.0 0.0 2.0 4.0 6.0Export growth
GDP growth 
Source: WTO Secretariat calculations, based on data available in Eurostat online database. Viewed at: 
http://ec.europa.eu/eurostat/data/database . 
1.4.  Domestic demand, mainly in private consumption, rebounded in 2014 and has again become 
the major driver of GDP growth (Chart 1.3). Up until 2014Q4, private consumption growth has 
been positive for six consecutive quarters. The acceleration of private consumption reflects the 
improvement in real gross disposable income due to falling headline inflation, as well as the 
moderate improvement in the labour market (s ection 1.1.2.2). In 2014, private consumption 
increased in Germany, the U.K., and Spain, whereas it is expected to contract in Greece, Cyprus, 
and Croatia; but remained weak in France and Italy (Table A1.2). 
Chart 1.3 EU-28 GDP growth and components' contributions, 2008-14 
(%) 
-5.0-4.0-3.0-2.0-1.00.01.02.03.0
2008 2009 2010 2011 2012 2013 2014Net exports
Investment
Public consumption
Private consumption
GPD growth rate
 
Source: Eurostat database , and DG ECFIN database. 
1.5.  Investment remains weak in the EU. In 2014Q3, gross fixed capital formation continued to 
contract in the euro area, and remained broadly stable throughout the EU after a slight contraction the previous quarter. The slow growth in investme nt in equipment and construction were the main WT/TPR/S/317 • European Union 
 
- 13 - 
 
  contributors to investment in the EU.3 In response to the weakness of investment, the EU launched 
an Investment Plan which is expected to mobilize  at least €315 billion over the next three years, 
with an aim of supporting the real economy and SM Es. The Investment Plan is intended to support 
"strategic investments" in infrastructure, including broadband and energy networks, transport 
infrastructure, renewable energy, and research and innovation.4 
1.6.  Government consumption expanded but at a moderate pace in 2014, reflecting consolidation 
efforts in some member States (section 1.1.2.1). This was especially so in countries with sizeable 
adjustment needs such as Italy, Greece, Portugal, Slovenia, Cyprus, and Croatia. 
1.7.  Although some indicators show signs of  improvement, the general outlook for the EU's 
economic recovery remains fragile. Domestic demand, notably investme nt, remains weak as 
shown by the Economic Sentiment Indicator and the Purchasing Managers Composite Index; and 
unemployment is still high; in particular the number of persons unemployed for more than 
24 months which has increased.5 Additionally, economic and geopolitical uncertainty surrounding 
some of its major trading partners could affect exports. On the positive side, a number of recent 
developments (e.g. depreciation in the euro, the fa ll in oil prices, the ECB's quantitative easing 
programme, and improvement in financial conditions) should improve the economic outlook. Taking all these factors into account would suggest that continuing and deepening the ongoing 
structural reforms are necessary for a stronger recovery in the EU economy. 
1.1.2  Structural reforms 1.8.  During the review period, a number of struct ural reforms have taken place in the EU member 
States in order to enhance competitiveness, covering, inter alia , fiscal consolidation, labour-market 
reform, education, and social welfare. The pace  and focus of structural reform vary among 
member States, although, according to the OECD, the overall pace of reform is well above the 
pace observed before the crisis.
6 
1.1.2.1  Fiscal governance improvement 
1.9.  Fiscal consolidation includes measures to discipline public expenditure and to broaden fiscal 
sources.7 In the 2014 Interim Report on policy reform, the OECD stated that many actions taken in 
2012-13 supported fiscal consolidation efforts although the reforms tended to concentrate on 
areas that did not involve substantial up-front budgetary costs.8 Some of the reforms were also 
linked to labour market reforms (section 1.1.2. 2), such as changes in the beneficiary systems. 
1.10.  In the wake of rapidly rising national debt and in response to some EU countries' failure to 
meet the fiscal targets set out in the EU rules, a number of new rules were introduced, notably the 
"Six Pack", "Two Pack" and the Treaty on St ability, Coordination and Governance (TSCG)9, which 
are aimed at, inter alia , enhancing economic governance through better budgetary surveillance, 
and swifter sanction against infringements.10 Under the Excessive Deficit Procedure (EDP), 
member States are required to reduce their fiscal deficits and/or public debts. The rules to correct excessive deficits were reinforced, in particular by requiring that, if a member State has a debt-to-
GDP ratio greater than 60%, it must reduce the excess by at least 5% a year on average over 
                                               
3 Equipment investment and construction investment in the euro area continued to shrink. 
4 European Commission document COM(2014) 903 final, 26 November 2014. Viewed at: http://eur-
lex.europa.eu/legal-content/EN/T XT/PDF/?uri=CELEX:52014DC0903&from=EN . 
5 European Commission (2015), European Economic Forecast, Winter 2015 . Viewed at: 
http://ec.europa.eu/economy_finance/publications/european_economy/2015/pdf/ee1_en.pdf . 
6 OECD (2014), Economic Policy Reforms 2014 : Going for Growth Interim Report . Viewed at: 
http://www.oecd-ilibrary.org/economics/economic-policy-reforms-2014_growth-2014-en  [10/01/15]. 
7 The OECD defines fiscal consolidation as a policy  aimed at reducing govern ment deficits and debt 
accumulation. Detailed explanations can be found at: http://www.oecd.org/tax/pub lic-finance/ch oosing-fiscal-
consolidation-instruments.htm  [10/01/2015]. 
8 OECD (2014), Economic Policy Reforms 2014: Going for Growth Interim Report . Viewed at: 
http://www.oecd-ilibrary.org/economics/economic-policy-reforms-2014_growth-2014-en  [10/01/15]. 
9 The Treaty on Stability, Coordination and Governance (TSCG) is an intergovernmental treaty which 
has 25 contracting parties, including all member States in the euro area. Croatia, the Czech Republic, and the 
United Kingdom are not contra cting parties to the TSCG. 
10 European Commission document MEMO/13/318, 10 April 2013. Viewed at: 
http://europa.eu/rapid/press-release_MEMO-13-318_en.pdf  [13/10.15]. WT/TPR/S/317 • European Union 
 
- 14 - 
 
  three years. In addition, euro area member States that breach the 3% of GDP deficit reference 
value and/or the debt criteria are subject to extr a surveillance as laid out in the "Two Pack". 
Surveillance in the preventive arm of the fisca l rules, which encourages member States to 
maintain sound fiscal policies over the medium-term, was also reinforced. Member States are 
required to attain a country-specific medium-term objective (MTO), set out by them respecting a 
country-specific limit. To that end, member States must deliver a minimum annual fiscal adjustment according to their cyclical conditions and comply with the "expenditure benchmark". 
1.11.  During the period under review, Austria, Belgium, Bulgaria, the Czech Republic, Denmark, 
Finland, Germany, Hungary, Italy, Latvia, Lithua nia, Luxembourg, the Netherlands, Romania, and 
Slovakia exited the EDP, leaving 11 member Stat es subject to EDP measures. Estonia and Sweden 
were not subject to the EDP.
11 The Commission, in early 2015, estimated that the deficit-to-GDP 
ratios should have decreased further in 2014 to 3% of GDP in the EU and 2.6% of GDP in the euro 
area, though to a lesser extent than in 2013. The debt-to-GDP ratio is expected to broadly 
stabilise around 2014-2015 in the EU and in the euro area, albeit at relatively high levels of 88% 
and 94% respectively.12 
1.12.  Fiscal consolidation was largely achieved through increasing revenue in 2013 and lowering 
expenditure in 2014. Revenue-to-GDP ratio in the EU peaked in 2013 at 45.4% with a small 
decline projected in the years thereafter. In the euro area, revenues are projected to peak in 2014 
at 46.6% of GDP and to broadly stabilize in the following years. This is largely due to higher revenues from indirect taxes coming from the acceleration of private consumption. However, despite a recommendation by the OECD, little action has been taken to limit the use of reduced 
rates of value-added tax (VAT) (section 3.3.3): only France was reported to have increased some 
reduced rates (for catering, prepared food produc ts, transport, and renovation work) from 7% to 
10% in 2014. The downward trend of expenditure was confirmed as the expenditure-to-GDP ratio 
fell from 49.9% in 2010 to 48.1% in 2014.
13 The decrease in expenditure mainly resulted from 
cost-containment in public wages and lower interest expenditure. 
1.13.  As the OECD noted, implementing consolidation measures may have adverse side-effects 
such as weakening domestic demand for consumption and investment, as well as demand for 
imports. However, as there may be a trade-off between consolidation and other policy objectives, the OECD suggested boosting the scope for efficiency gains through structural reforms.
14 Some 
research has also argued that the impact of fiscal consolidation on trade is limited: only 4.1% of 
the total value of public procurement published in the Tenders Electronic Daily  (TED) in 2011 was 
awarded directly cross-border to foreign suppliers.15 
1.1.2.2  Labour market reforms 
1.14.  During the period under review, a number of  measures to improve the functioning of labour 
markets were adopted. These measures cover areas including early retirement schemes, employment protection legislation, and activation and assistance for those not working. 
1.15.  There have been some reforms affecting the labour market such as decentralized wage 
bargaining and more flexible wage arrangements, especially in some member States: in Greece and Spain, collective agreements at the enterprise level were given more priority than those at the sector level; conditions for justified dismissals have been eased in France, Portugal, Slovenia, and 
                                               
11 European Commission online informatio n, "The corrective arm". Viewed at: 
http://ec.europa.eu/economy_finance/economic _governance/sgp/corrective_arm/index_en.htm  [14/01/15]. 
12 See European Commission (2015), European Economic Forecast, Winter 2015 , viewed at: 
http://ec.europa.eu/economy_finance/publications/european_economy/2015/pdf/ee1_en.pdf ; also see 
European Commission document COM(2014) 902 final, 28 November 2014, viewed at: 
http://ec.europa.eu/europe2020/pdf/2015/ags2015_en.pdf  [15/01/15]. 
13 The figure for 2014 is an estimated number. A similar trend is also observed in the euro area. 
14 Boris Cournède, Antoine Goujard, Álvaro Pina, and Alain de Serres (2013), Choosing fiscal 
consolidation instruments compatible with growth and equity , OECD Economic Policy Paper, No. 07/42. Viewed 
at: http://www.oecd-ilibrary.org/economics/choosing-fiscal- consolidation-instruments-compatible-with-growth-
and-equity_5k43nxq6dzd4-en  [13/10/15]. 
15 Kutlina-Dimitrova, Zornitsa, and Csilla Lakatos (2014), Determinants of Direct  Cross-border Public 
Procurement in EU Member States , DG Trade Chief Economist Note, issue 2. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2014/july/tradoc_152700.pdf . WT/TPR/S/317 • European Union 
 
- 15 - 
 
  Spain; and Italy initiated a comprehensive reform aimed at reducing segmentation as well as 
extending the scope of welfare rights. 
1.16.  In order to encourage higher participation in the labour market, a number of countries 
reformed their beneficiary systems, including re forms to the pension schemes (e.g. Poland), and 
the introduction of universal unemployment benefit in Italy. The terms of unemployment benefits 
have been tightened and linked to other Active Labour Market Policy (ALMP) in member States, such as in the Czech Republic and Spain. Taxes on labour income have also been eased in some 
member States, for example the Netherlands reduced the top rate of income tax in 2012, and 
several member States reduced social security  contributions for self-employed workers (e.g. 
France). 
1.17.  Some indicators suggest that labour markets in the EU have become more flexible. Over the 
period 2010-13, real income of workers (indicated by the net earnings of a single person without 
children adjusted for inflation) decreased in several EU member States. The largest decreases were found in Portugal, followed by the United Kingdom, Spain, Luxembourg, and Greece. On the 
other hand workers in Hungary, Sweden, and Poland enjoyed a notable increase in their real 
income (Chart 1.4). 
Chart 1.4 Cumulative growth of net earnings – nominal and adjusted for HICP inflation, 
2010-14 
(%) 
-15.0-10.0-5.00.05.010.015.020.025.030.035.0BGRHUNSWEPOLMLTDEULVADNKBELSVKNLDIRLLTUSVNROUCZEFRAITAAUTFINGRCLUXESPGBRPRTNominal net earnings HICP Real net earnings
 
Note: 2010-2013 cumulative growth for Bulgaria, Malta, Latvia, Lithuania, and Romania. 
Source: Information provided by the European Co mmission, calculations based on Eurostat data. 
1.18.  These labour market reforms have started to show results: employment picked up faster 
and more strongly in response to the rebound in economic activity, compared to the usually lagged 
response in previous crises. A rise in employment was observed in a large majority of member States, including those with the highest unemplo yment rates: in 2014Q3, employment in Greece 
grew 1.7% on a quarter-on-quarter basis, 1.4% in Portugal, and 0.3% in Spain; long-term 
unemployment also fell in 2014Q3. 
1.19.  Labour market reforms, including support measures for training and education that aim to 
enhance productivity, should contribute to greater competitiveness, at least as indicated by Unit 
Labour Costs (ULCs).
16 Slower growth or a decline in ULCs does not necessarily suggest lower 
earnings, as it may be the result of improved labour productivity (Chart 1.5). In particular, in 
                                               
16 Unit Labour Costs (ULCs) are defined as the av erage cost of labour per unit of output and are 
calculated as the ratio of total labour costs to real ou tput. A rise in ULCs represen ts an increased reward for 
labour’s contribution to output. ULCs should no t be interpreted as a comprehensive measure of 
competitiveness, but as a reflection of cost-competitiveness. ULC measures deal exclusively with the cost of 
labour which, though important, should also be considered in relation to changes in the cost of capital, especially in advanced economies. Viewed at: http://stats.oecd.org/glossary/detail.asp?ID=2809 .  WT/TPR/S/317 • European Union 
 
- 16 - 
 
  Greece, Portugal, Spain, and Romania, ULCs fell in 2013, which indicated improvements in 
competitiveness and the terms-of-trade (for both intra- and extra-EU exports). 
Chart 1.5 Nominal unit labour costs (index), 2010 and 2013 
 
-4.0-3.0-2.0-1.00.01.02.03.04.05.06.0
020406080100120140
BEL
BGR
CZE
DNK
DEU
EST
IRL
GRC
ESP
FRA
HRV
ITA
CYP
LVA
LTU
LUX
HUN
MLT
NLD
AUT
POL
PRT
ROU
SVN
SVK
FIN
SWE
GBR
2010 2013 Growth rate (2010-13, % growth rate p.a)Index, 2005=100 % growth rate p.a. Index, 2005=100 % growth rate p.a.
 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
1.1.2.3  Current account imbalance 
1.20.  The current account imbalances of most EU member States have narrowed substantially 
since they peaked before the crisis started in autumn 2008; the sharp decline in oil prices since 
June 2014 further strengthened the current account surplus for the EU as a whole (Chart 1.6). 
However, the OECD has argued that the narrowing in current account imbalances can be caused 
by cyclical factors such as negative output gaps, while the structural component of such imbalance appears not to have changed much.
17 
Chart 1.6 Current account and trade bala nce as a share of GDP, 2011Q1-2014Q3 
(%) 
-2.0-1.5-1.0-0.50.00.51.01.52010Q12010Q22010Q32010Q42011Q12011Q22011Q32011Q42012Q12012Q22012Q32012Q42013Q12013Q22013Q32013Q42014Q12014Q22014Q3
CA % of GDP
TB % of GDP
 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
                                               
17 OECD (2014), Economic Policy Reforms 2014: Going for Growth Interim Report . Viewed at: 
http://www.oecd-ilibrary.org/economics/economic-policy-reforms-2014_growth-2014-en  [10/01/15]. WT/TPR/S/317 • European Union 
 
- 17 - 
 
  1.2  Trade Performance 
1.21.  International trade remained an important driver of economic growth in the EU for the 
period 2010-13 (Chart 1.3). Taking the EU-28 as  a whole, by late-2010 the extra-EU export 
volume, which measures exports in real terms, had fully recovered from the global financial crisis 
and has continued to grow since then as the volume of extra-EU exports increased 
25.5 percentage points since 2010Q1. However, extra-EU imports have been subdued reflecting weak domestic demand, especially the shortfall of investment (Chart 1.7). 
Chart 1.7 EU-28 trade volume (index), 2008Q1-2014Q3 
7080901001101201302008Q12008Q22008Q32008Q42009Q12009Q22009Q32009Q42010Q12010Q22010Q32010Q42011Q12011Q22011Q32011Q42012Q12012Q22012Q32012Q42013Q12013Q22013Q32013Q42014Q12014Q22014Q3Intra EU28 Imports
Extra EU28 Imports
Intra EU 28 Exports
Extra EU28 Exports
 
Note: Base year 2000, index value in 2000=100. Data has not been seasonally adjusted. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
1.22.  The recent depreciation of the euro relative to the EU's major trading partners is also 
expected to strengthen the competitiveness of the EU and euro area exporters. However, the 
impact of a weak euro, as the Commission forecasts, remains moderate because only about half of 
the change in exchange rates is usually passed th rough to export prices. Considering the expected 
increase in imports due to domestic demand growth, it is expected that net exports will contribute little to GDP growth over the next few years.
18 
1.2.1  Intra-EU trade 
1.23.  During the period under review, intra-EU  trade in real terms has not yet recovered to 
pre-crisis levels (Chart 1.7), which reflects the weak economic activity in the region. However, despite the growth in extra-EU exports and the de cline/stagnation in intra-EU trade, the nominal 
value of intra-EU trade remains much greater than  the value of extra-EU trade. In 2013, intra-EU 
exports accounted for €2,839 billion compared to €1,738 billion for extra-EU exports. 
1.24.  The share of intra-EU exports in total ex ports varies among member States, but in most 
cases is above 50% (except Greece, the United Kingdom, and Malta in 2013). Intra-EU exports 
from member States in the central- and eastern-EU such as the Czech Republic, Estonia, and Poland accounted for the majority of their total exports (Chart 1.8). 
1.25.  The composition of intra-EU merchandise trade did not change much during the review 
period (Table A1.5): machinery and transport equipment accounted for the largest share (33% in 
2013), followed by other manufactured goods (26%), and chemicals (16%). 
                                               
18 European Commission (2015), European Economic Forecast, Winter 2015 . Viewed at: 
http://ec.europa.eu/economy_finance/publications/european_economy/2015/pdf/ee1_en.pdf . WT/TPR/S/317 • European Union 
 
- 18 - 
 
  Chart 1.8 Intra- and extra-EU exports, 2010 and 2013 
(%) 
0102030405060708090SVKCZELUXPOLHUNSVNNLDPRTBELROUAUTESPESTLVACYPDNKBGRHRVLTUFRADEUIRLITASWEGRCFINGBRMLT
Intra-EU28 Extra-EU 282010
0102030405060708090SVKCZELUXHUNNLDSVNPOLESTPRTBELAUTROULVADNKESPBGRFRAHRVCYPSWELTUDEUIRLFINITAGRCGBRMLT2013
 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
1.26.  As with intra-EU merchandise trade, for most EU member states, intra-EU trade in services 
accounted, on average, for more than half of their international transactions. The largest surplus of 
intra-EU services trade in 2013 was recorded by Luxembourg (€18.0 billion), followed by the U.K. 
(€12.0 billion) and the Netherlands (€10.6 billion). Germany recorded the highest deficit (€40.0 billion) and it was the biggest intra-EU tr ader of services, accounting for 18% of intra-EU 
imports and 12% of intra-EU exports.
19 Some observers, such as the OECD, stated that removing 
internal barriers would significantly boost intra-EU trade in services, and thus achieve higher economic growth.
20 The Commission noted that the Single Market Acts I and II have addressed 
such issues. 
1.2.2  Extra-EU trade 
1.27.  Extra-EU trade continued to grow in both  nominal and real terms during the period under 
review. However the EU's share of world trade in goods and services has continued to decline: in 
2013 EU exports of goods and services accounted for 16.4% of world trade, a decrease from 
19.5% in 2004 and 17.3% in 2010.21 For the period 2010-13, the EU's share of world merchandise 
trade decreased slightly, from 15.8% in 2010 to 15% in 2013. 
                                               
19 Eurostat data extraction. Viewed at: http://appsso.eurostat.ec.europa.eu/ITS_services_balance . 
20 OECD (2014), Economic Surveys: European Union 2014 . Viewed at: http://www.oecd-
ilibrary.org/economics/oecd-economic-surveys-european-union-2014_eco_surveys-eur-2014-en . 
21 European Commission online information, "EU position in world trade". Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_122532.pdf  [09/01/15].  WT/TPR/S/317 • European Union 
 
- 19 - 
 
  1.28.  Regarding merchandise trade, the United States remains the biggest market for EU exports, 
accounting for 16.6% of the EU's exports to the wo rld in 2013, followed by Switzerland with 9.8%. 
Asia, including China (8.5%) and Japan (3.1%), was the largest regional market for EU goods, accounting for 26.5% in 2013 (Chart 1.9). 
Chart 1.9 Direction of merchandise trade, 2010 and 2013 
(%) 
2010 2013
(a)    Exports (f.o.b.)
Asia  
26.9%
Middle East
7.8%America 
25.4%
Switzerland
9.8%
Norway 
2.9%
Turkey 
4.5%
CIS
9.9%
Total:  €1,353 billion Total:  €1,738 b illion
(b)    Imports 
Norway
5.2%Europe  
14.5%Other America
7.9%
Middle East 
4.7%Africa 
9.0%America 
19.3%
Russian 
Federation 
10.6%Other 
1.3%
Switzerland
5.7%
Other Europe
0.9%Japan
4.4%Other Asia
14.9%
Other CIS
2.8%CIS
13.4% Turkey
2.8%China
16.6%Europe 
15.1%Asia
34.0%Other America 
7.7%
Africa 
10.0%Middle East 
4.9%America 
19.4%
Russian 
Federation 
12.2%Other 
1.0%
Norway
5.4%Switzerland
5.7%
Other CIS
3.5%Other Europe 
1.1%CIS
15.7% Turkey
3.0%United States 
11.7%
Total:   €1,529 billio n Total:   €1,682 b illionOther Asia
13.9%United States
17.9%
Other Europe
2.0%United States 
16.6%
Japan
3.4%
Asia
37.9%Switzerland
8.2%
Other 
Europe 
2.1%Other America
8.8%
Africa 9.4%Other Asia
14.8%
China 
8.5%Other America
8.9%
China
18.6%Other    
2.3%
Africa 
8.8%
United States 
11.4%Japan 
3.3%
Europe
17.9%
Middle East
7.9%Other 
1.9%
China 
8.4%
Europe
19.3%Japan 
3.1%
Asia   
26.5%
Norway 
3.1%America 
26.8%
Turkey 
4.6%Other Asia
15.3%
CIS
9.1%
 
Source: WTO Secretariat calculations, based on Eurostat data. 
1.29.  Asia remained the largest source of EU imports with 34% of total EU imports in 2013, 
although this was a decrease from 37.9% in  2010 (Chart 1.9). Although the import value 
increased in current prices, the volume of EU imports, measured in real terms, dropped 3.2 WT/TPR/S/317 • European Union 
 
- 20 - 
 
  percentage points during 2010-13 (Chart 1.7).22 By country, China was the biggest source of 
imports, accounting for 16.6%, followed by the Russian Federation (12.2%), the United States (11.7%), Switzerland (5.7%), and Norway (5.4%). 
1.30.  With regard to composition of merchandise trade, manufactured goods accounted for the 
largest share of EU exports and imports. Transp ort equipment was the largest category accounting 
for 16.4% of total exports in 2013, up from 15.5% in 2010. Machinery as a whole, including electrical (4.5%), non-electrical (12.5%), and power generating machinery (3.0%) accounted for 
the largest share of EU exports. Chemical pr oducts accounted for 15.7% of exports in 2013 
(Chart 1.10). 
1.31.  Other than manufactured goods, nearly 30% of the 2013 value of imports was fuels, up 
from 25.2% in 2010. This increase in import value for fuels reflected higher prices in 2010-13. 
1.32.  Regarding extra-EU trade in services, exports in 2013 grew by 5% compared to the 
previous year, reaching €709.7 billion (Table 1.1). During the period 2012-13, the EU remained a net exporter of services. The surplus in EU servic es trade in 2013 was €178 billion, up from €160.9 
billion in 2012. It has been argued that the EU's se rvices trade would be significantly larger if one 
took account of services embedded in manufac tured goods exports were taken into account.
23 
                                               
22 The Commission pointed out that the EU's import volume has reached the same level as in mid-2010, 
according to the latest available data. 
23 Cernat, Lucian, and Zornitsa Kutlina-Dimitrova (2014), Thinking in a box: A 'Mode 5' approach to 
services trade , Journal of World Trade, vol 48(6), pp. 1109-26. Viewed at: 
https://www.kluwerlawonline.com/abstract.php?area=Journals&id=TRAD2014039 .  WT/TPR/S/317 • European Union 
 
- 21 - 
 
  Chart 1.10 Composition of merchandise trade, 2010 and 2013 
(%) 
2010 2013
(a)    Exports 
Other 
manufactures
9.1%
Manufactures
80.6%Iron and steel
2.2%
Chemicals
15.7%Non-
electrical 
machinery
12.5%
Electrical 
machines
4.5%Textiles and 
clothing
2.3%
Office and 
telecommunication 
equipment
4.3%Power 
generating 
machinery
3.0%
Total:  €1,353 billion Total:  €1,738 billion  
(b)    Imports 
Chemicals
9.0%Transport 
equipment  
7.3%Manufactures
59.2%Textiles and 
clothing
5.8%
Other 
machinery
9.3%
Mining
4.7%Fuels
25.2%
Iron and steel
1.7%Office and 
telecommunication 
equipment
12.4%Office and 
telecommunication 
equipment
10.0%
Iron 
and steel
1.5%Other
2.5%
Textiles and 
clothing
5.6%Agriculture
7.6%
Other semi-
manufactures
4.9%Transport 
equipment  
6.0%
Chemicals
9.4%Manufactures
55.7%
Total:   €1,529 billion Total:  €1,682 billion Manufactures
77.0%
Other 
manufactures
8.6%Other
3.3%Other 
manufactures
9.1%
Fuels and mining
8.5%
Chemicals
17.2%
Other 
machinery
9.8%Other semi-
manufactures
7.0%Fuels and 
mining
9.3%Agriculture
7.7%
Other 
manufactures
8.9%Other semi-
manufactures
7.4%
Other semi-
manufactures
4.9%Transport 
equipment
15.5%
Agriculture
8.0%Other
3.8%Other
6.0%
Mining
4.2%Fuels
29.6%Transport 
equipment
16.4%Power generating 
machinery
3.2%Agriculture
7.2%
Iron and steel
2.5%
Non-electrical 
machinery
12.9%Textiles and 
clothing
2.4%
Office and 
telecommunication 
equipment
5.6%Electrical 
machinery
4.8%
 
Note: Product groups categorized by SITC, Rev.4 
Source: WTO Secretariat calculations, based on Eurostat data. WT/TPR/S/317 • European Union 
 
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  Table 1.1 Extra-EU trade in services, components and partners, 2012-13 
 Export Import 
 2012 2013a 2012 2013a
Total (€ billion) 675.8 709.7 514.9 531.6
 % of total 
Manufacturing services on physical inputs owned by others 3.01 2.96 1.39 1.16 
Maintenance and repair services n.i.e. 1.02 1.21 0.54 1.39 
Transport 21.03 20.08 23.24 23.00 
  Sea transport 11.26 10.81 11.33 10.63 
  Air transport 6.75 6.06 7.82 8.27 
  Other modes of transport 2.67 2.79 3.58 3.40 
Travel 14.20 14.50 17.55 16.82 
  Business 2.57 2.47 3.98 3.84 
  Personal 11.63 12.03 13.57 12.98 
Construction 1.65 2.08 1.12 1.00 
Insurance and pension services 4.64 4.45 2.15 2.09 
  Direct insurance 3.44 2.92 0.74 0.83 
  Reinsurance 0.73 1.09 1.24 1.02 
Financial services 10.27 10.40 5.55 5.71 
  Financial services explicitly charged and other financial 
services 8.23 8.37 4.79 4.83 
  Financial intermediation services indirectly measured 
(FISIM) 2.04 2.03 0.76 0.88 
Charges for the use of intellectual property n.i.e. 5.35 5.05 8.51 8.34 
Telecommunications, computer, and information services 11.23 11.36 8.36 8.81 
  Telecommunications services 2.67 2.54 2.46 2.45 
  Computer services 8.14 8.28 5.50 5.90 
  Information services 0.42 0.54 0.39 0.46 
Other business services 24.88 25.12 28.51 28.65 
  Research and development services 3.84 4.00 5.25 5.21 
  Legal services 0.89 0.78 0.52 0.53 
  Accounting, auditing, bookkeeping, and tax consulting 
services 0.69 0.61 0.73 0.52 
  Business and management consulting and public relations 
services 4.33 4.16 4.88 4.74 
  Advertising, mark et research, and public opinion polling 
services 1.96 2.12 2.66 2.64 
  Architectural services 0.31 0.15 0.13 0.06 
  Engineering services 3.05 3.10 1.15 1.11 
  Scientific and other technical services 1.27 0.97 0.97 0.86 
  Waste treatment and de-pollution, agricultural and mining 
services 0.88 1.22 0.32 0.39 
  Operating leasing services 1.33 1.38 1.27 1.36 
  Trade-related services 1.27 1.55 3.85 4.29 
  Other business services n.i.e. 5.08 5.08 6.78 6.93 
Personal, cultural, and recreational services 1.12 1.28 1.71 1.81 
  Audiovisual and related services 0.66 0.85 0.91 0.86 
  Personal, cultural, and recr eational services other than 
audiovisual and related services 0.46 0.42 0.80 0.95 
Government goods and services n.i.e. 1.31 1.21 1.31 1.17 
Services not allocated 0.28 0.30 0.07 0.06 
Selected trading partners/region   
European Free Trade Association 17.82 17.85 12.66 13.05 
  Iceland 0.14 0.10 0.15 0.18 
  Liechtenstein 0.13 0.11 0.07 0.06 
  Norway 3.56 3.62 2.49 2.62 
  Switzerland 13.99 14.02 9.96 10.19 
Turkey 1.46 1.48 2.81 2.89 
Russian Federation 4.26 4.32 2.70 2.69 
Africa 7.04 6.46 7.10 6.66 
  Northern Africa 2.13 1.93 3.50 3.19 
    Egypt 0.54 0.45 1.11 0.98 
    Morocco 0.47 0.44 0.88 0.86 
  Central and South Africa 4.91 4.53 3.60 3.47 
    South Africa 1.10 1.01 0.85 0.85 
Northern America 28.03 27.95 32.71 32.27 
  Canada 2.58 2.46 2.16 2.14 
  United States 25.43 25.46 30.49 30.07 
Mexico 1.13 1.07 0.69 0.71 WT/TPR/S/317 • European Union 
 
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   Export Import 
 2012 2013a 2012 2013a
Argentina 0.62 0.57 0.47 0.42 
Brazil 2.34 2.08 1.27 1.18 
Asia 23.01 23.80 22.93 23.02 
  China 3.71 4.09 3.88 3.93 
  Hong Kong, China 1.45 1.38 1.78 1.83 
  Japan 3.55 3.49 3.05 2.75 
  Chinese Taipei 0.67 0.65 0.57 0.62 
  India 1.74 1.62 2.44 2.30 
Australia 2.82 2.65 1.67 1.54 
New Zealand 0.36 0.30 0.31 0.26 
a Provisional data. 
 Note: Data reported according to BPM6. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
1.33.  The major activities of services trade were recorded under "other business services": in 
2013, "other business services" accounted for 25% of exports and 28% of imports of services 
(Table 1.1).24 Other business services, professional services and technical services (e.g. legal 
services, accounting services, architectural services, engineering services, etc.) accounted for 
10.9% of exports and 9.6% of imports in 2013, with a surplus of €26 billion. Financial services together with insurance and pension services ge nerated the biggest services trade balance in 
2013, with a surplus of €64 billion (35% of EU total services trade surplus). 
1.34.  In services the U.S. remained the larges t trading partner, accounting for 25% of exports 
and 30% of imports in 2013. Switzerland accounted for around 14% of exports and 10% of imports. Asian economies, including China; Hong Kong, China; India; Japan; and Chinese Taipei, 
accounted for 23% of exports and imports, respectively. 
1.35.  The U.K. was the largest services exporter among the EU member States, accounting for 
33.9% of total services exports in 2013. The U.K.  recorded the highest surplus of services trade 
with €92 billion, followed by Spain (€48 billion), and Luxemburg (€22 billion). Germany and 
Finland were the only EU member States with a deficit in services trade in 2013.
25 
1.3  Foreign Direct Investment 
1.36.  The EU as a whole continues to be the largest recipient and supplier of foreign direct 
investment (FDI) in the world, although it is a net investor. As at end 2013, it held €4,900 billion FDI stocks outside the EU against €3,778 billion in stocks held inside the EU. 
1.37.  Flows of FDI have gradually recovered since the onset of the global financial crisis. In 2013, 
the outbound flow reached €478 billion, and the inbound flow was €523 billion, compared to 
€332 billion and €274 billion respectively in 2009, (however, differences in methodologies make such a comparison tentative).
26 
                                               
24 Data on the EU’s services trade for 2012-13 is base d on BPM6 services' classification, and is available 
on Eurostat online database. The data organized accord ing to BPM6 is not directly comparable with data 
organized according to other classifications (e.g. services  trade reported in the previous Review of the EU). 
Also see Eurostat online information,  "Measuring international trade in services - from BPM5 to BPM6", viewed 
at: http://ec.europa.eu/eurostat/statistics-explained/inde x.php/Measuring_international_trade_in _services_-
_from_BPM5_to_BPM6  [31/03/15]. 
25 Eurostat data extraction. Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui /show.do?dataset=bop_its6_det&lang=en . 
26 Data on EU’s FDI in 2013 is based on BPM6 wh ereas the FDI data in 2009 is based on BPM5. The 
methodological changes in compilation make the values of  FDI, both in terms of flows and stocks, not directly 
comparable under different presentati ons (i.e. BPM6 versus BPM 5). In th e case of FDI, treatments to the 
recording of reverse invest ment and of permanent debt are significantly different, which also cause the non-
comparability. For a detailed explanation, se e IMF document, FAQs on Conversion from BPM5 to BPM6 . Viewed 
at: https://www.imf.org/external/pubs/ft/bop/2007/bpm6faq.pdf . WT/TPR/S/317 • European Union 
 
- 24 - 
 
  Table 1.2 Foreign direct investment flows, 2013 
(€ million) 
  Outbound Inbound
Intra-EU FDI 294,807.40 247,710.10
Extra EU FDI 477,509.90 523,020.00
European Free Trade Association 36,441.60 34,266.80 
  Iceland -378.9 407.6 
  Liechtenstein 326.5 -552.6 
  Norway 8,022.30 5,004.00 
  Switzerland 28,472.00 29,406.80 
Turkey 934.5 2,577.40 
Russian Federation 4,685.40 -2,333.40 
Euro-Med Partnership Countries 13,592.90 7,285.80 
  Egypt 1,795.00 2,469.70 
  Morocco 233.3 414.1 
Africa 24,467.10 6,662.80 
 Central and South Africa 11,200.40 3,021.50 
  South Africa 2,339.60 410.6 
  Nigeria 2,299.60 127.1 
America 347,444.40 447,385.10 
  Canada 8,146.20 13,493.10 
  United States 225,200.50 421,242.30 
  Mexico 20,334.20 3,668.90 
  Chile 4,705.20 886.5 
  MERCOSUR 38,276.40 7,674.00 
    Argentina 4,486.50 349.9 
    Brazil 37,828.70 9,637.40 
Asia 46,381.90 43,772.40 
  Chinaa 17,101.50 4,753.20 
  Hong Kong, China 10,018.90 3,952.40 
  Japan 5,104.80 14,796.90 
  Korea, Republic of 1,220.90 1,250.30 
  Chinese Taipei 773.9 61.2 
  India 4,300.70 1,409.20 
  ASEAN 14,131.90 7,783.10 
    Malaysia 1,940.60 617.5 
    Philippines 282.7 204 
    Singapore 10,974.50 6,817.10 
    Thailand -2,792.90 304.9 
  Gulf Arabian Countries 6,565.10 9,291.10 
Australia 10,371.30 6,228.30 
New Zealand 766 33.6 
 
Note: Data reported according to BPM6. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
1.38.  The EU's FDI flows to advanced economie s reverted to significant growth in 2013; the 
United States accounted for 47% of outward FDI flows in 2013; Switzerland for 6% and Australia for 2%. Among emerging markets, Brazil accounted for 7.9%, Mexico for 4.3% and China for 
3.6% (Table 1.2). 
1.39.  The United States is the largest sources of inward FDI into the EU, both in terms of stocks 
and flows (Table A1.10). Among the member States, Germany, France, the Netherlands, and Luxembourg are the main locations of FDI stocks.  
1.40.  FDI can be an important source of producti vity gains, and higher labour productivity may 
contribute to further FDI growth. In the period of 2003-12, labour productivity grew strongly in the 
EU's eastern member States, as did FDI stocks (Chart 1.11). In view of encouraging FDI and 
productivity gains, the OECD suggested that the EU member States further reduce barriers to 
business such as specific equity restrictions, approval requirements and other operation restrictions (section 2.4.1).
27 
                                               
27 OECD (2014), Economic Surveys: European Union 2014. Viewed at: http://www.oecd-
ilibrary.org/economics/oecd-economic-surveys-european-union-2014_eco_surveys-eur-2014-en . WT/TPR/S/317 • European Union 
 
- 25 - 
 
  Chart 1.11 FDI and labour productivity growth, 2003-12 
BGR
CZE
DNKDEUEST
IRL
GRCESP
FRA
HRV
ITACYPLVA
LUXHUN
MLTNLD
AUTPOL
PRTROU
SVNSVK
FINSWE
GBRLTU
-1.00.01.02.03.04.05.0
0.0 5.0 10.0 15.0 20.0 25.0 30.0Labour productivity growth
FDI stock growthAverage annual growth rates, %
 
Note: No data available for Belgium; data for Lithuania available for 2005-12. FDI data include intra-EU 
FDI; data reported according to BPM5. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . WT/TPR/S/317 • European Union 
 
- 26 - 
 
  2  TRADE AND INVESTMENT REGIME 
2.1  Legal and Institutional Framework1 
2.1.  There have been no major changes in th e legal and institutional framework for trade and 
investment policies in the EU since the last Review in 2013. In accordance with the Treaty on the 
Functioning of the European Union (TFEU), th e Common Commercial Policy (CCP) remains the 
exclusive competence of the EU.2 In addition, customs union, agricultural and fisheries policy, 
internal market, and consumer protection, among others, are areas where the EU has exclusive or 
shared competence.3 
2.2.  The scope of common commercial policy covers trade in goods, trade in services, the 
commercial aspects of intellectual property rights, foreign direct investment, and trade defence measures.
4 In these areas, member States may act individually only when authorized by the EU. 
In the areas of shared competences (e.g. consumer protection, transport, etc.), the EU member 
States retain varying degrees of independent regulatory authority, depending on whether, and to what extent, the EU has already adopted measures. Hence, the adoption of national measures in 
these areas may affect trade within the EU, and with non-EU countries. 
2.3.  The EU's trade and trade-related policies are formulated and implemented by means of two 
types of legislation: primary legislation (e.g. treaties and other agreements of similar status), and 
secondary legislation. Secondary legislation can take the form of: 
• regulations (with general application) that are binding and directly applicable to all 
member States; 
• directives that require transposition into national law and practice; 
• decisions that are binding on those addressed in the decision; and 
• recommendations and opinions, that are based on primary legislation but are not legally 
binding. 
2.4.  Some outside observers have pointed out that using the form of directives may increase the 
EU-origin regulatory burdens through the domestic legal acts needed to transpose directives into national law which may increase the probability of non-uniform application of EU rules.
5 The 
Commission indicated that trade policy is administered, in general, in the form of regulations that 
ensure the uniform implementation of the common commercial policy throughout the EU. 
2.5.  The EU's trade policy is decided through th e "ordinary legislative procedure" under which the 
Commission puts forward legislative proposals to the European Parliament and the Council which 
may, in turn, propose amendments. 
2.6.  The Commission implements trade policy through "delegated acts" and "implementing acts".6 
Under "delegated acts", the legislators (i.e. the Council and the European Parliament) delegate 
power to the Commission to adopt non-legislative acts of general application, in order to 
supplement or amend certain non-essential elements of the legislative act. Under "implementing acts", the Commission, where specified in the primary legislation, acquires the necessary 
implementing powers in instances where uniform conditions for implementing legally binding EU 
acts are needed. The Commission's exercise of impl ementing powers is controlled by the member 
                                               
1 The legal and institutional framework of the EU does not extend to all territori es under the jurisdiction 
of all member States. According to some member St ates, their membership of the WTO includes some 
territories for which they have jurisd iction, but these territories are not co vered by their membership of the EU. 
This report does not cover these territories. 
2 Article 3(1), the Treaty on the Functioning of the European Union (TFEU). 
3 For detailed competences of the EU, see:  Europa online information. Viewed at: 
http://europa.eu/legislation_summaries/institutional_affairs/treaties/lisbon_treaty/ai0020_en.htm ; and 
European Commissi on's European citizens' initiative  online information. Viewed at: 
http://ec.europa.eu/citizens-initiative/public/competences/faq .  
4 Article 207 (1), TFEU. 
5 OECD (2014), OECD Economic Survey: Eu ropean Union, April 2014. Viewed at: http://www.oecd-
ilibrary.org/economics/oecd-economic-surveys-european-union-2014_eco_surveys-eur-2014-en . 
6 Articles 290 and 291(2), TFEU. WT/TPR/S/317 • European Union 
 
- 27 - 
 
  States through "comitology", the procedure whereby committees composed of representatives 
from member States assist the Commission in executing the "implementing powers" conferred upon it by the legislators. The rules of "comitology" have not changed since March 2011.
7 
2.7.  The adaptation of trade instruments to th e new "comitology" rules has been completed on 
the Trade Omnibus I and II Regulations, and entered into force on 20 February 2014.8 According 
to the Commission, the Trade Omnibus Regulations fo rm part of the alignment of legislation to the 
new regime for implementing and delegating acts introduced by the Lisbon Treaty. Omnibus I 
covers 22 pieces of legislation, largely on trad e defence instruments (the anti-dumping regulation, 
safeguard legislation etc.); whereas Trade Omnibus II concerns seven pieces of legislation, largely on trade relations (e.g. EPAs). The Commission made proposals for a codification of the acts concerned by Trade Omnibus I and II in order to improve the legibility of those acts.
9 
2.8.  Before commencement of trade negotiations  with a non-EU territory or territories, the 
Commission must acquire prior authorization from the Council whose decisions are taken by qualified majority voting (QMV).
10 The Commission must conduct negotiations in consultation with 
a special committee appointed by the Council (usual ly the Trade Policy Committee), and within the 
framework of relevant Council negotiating direct ives. The Commission must regularly report the 
progress of negotiations to the special committee and the European Parliament. 
2.9.  On ratification of trade agreements, the Eu ropean Parliament and the Council vote on trade 
agreements as a whole. The European Parliament ratifies trade agreements by simple majority, while the Council generally needs a qualified majority to give consent. Unanimity in the Council is required for agreements on trade in services, co mmercial aspects of intellectual property rights, 
and foreign direct investment that include provisions for the adoption of internal rules. Unanimity 
in the Council is also required for the negotiation and conclusion of agreements on trade in cultural and audiovisual services, and in social, education and health services.
11 For agreements that go 
beyond the competence of the EU (e.g. CCP), ratifi cation by the national parliaments of individual 
member States may be required. 
2.10.  The Council may agree to the provisional application of a trade agreement, where 
parliamentary consent is not required. However, if the European Parliament were to refuse to 
consent to the conclusion of an agreement, the de cision on provisional application would need to 
be reconsidered by the Council. 
2.11.  During the period under review, Croatia became the 28th member State of the EU. Accession 
negotiations are ongoing with Turkey, Montenegro , and Serbia while negotiations with Iceland 
have been on hold since May 2013. 
2.2  Trade Policy Objectives and Consultation 
2.12.  The TFEU describes common commercial policy as an integral part of the EU's overall 
external action. The EU's trade policy is required  to address developmental, environmental, and 
social objectives, and contribute to the objectives set out in the Treaty on the European Union, 
including development and consolidation of democracy and the rule of law, and respect of human 
rights. Since its last TPR, the objectives of the EU's trade policy remain largely unchanged, which 
                                               
7 The new "comitology" rules came into effect on 1 March 2011. See Regulation (EU) No. 182/2011 of 
the European Parliament and of the Council, 16 Fe bruary 2011 (OJ L 55/13, 28 February 2011), also see WTO 
document WT/TPR/S/248/Rev.1 of 1 August 2011, chart II.1. 
8 Regulation (EU) No. 37/2014 of the European Parliament and of the Council, 15 January 2014 
(OJ L 18/1, 21 January 2014), and Regulation (EU) No. 38/2014 of the European Parliament and of the Council, 15 January 2014 (OJ L 18/52, 21 January 2014).  
9 For example, the Commission made a proposal of codification of anti-dum ping regulations. See 
European Commission document COM(2014) 667 final, 28 October 2014. 
10 Under the qualified majority voting (QMV) system there are 352 votes divided among the member 
States roughly according to population with 260 votes required for a QMV. Germany, France, Italy, and the 
United Kingdom have 29 votes each; Spain and Poland  have 27 votes each; Romania has 14 votes; the 
Netherlands has 13 votes; Belgium, the Czech Republic, Greece, Hungary, and Portugal have 12 votes each; Austria, Bulgaria, and Sweden have 10 votes each; Denmark,  Croatia, Finland, Ireland,  Lithuania, and Slovakia 
have 7 votes each; Cyprus, Estonia, Latvia, Luxembou rg, and Slovenia have 4 votes each; and Malta has 3 
votes. 
11 Article 207(4), TFEU. WT/TPR/S/317 • European Union 
 
- 28 - 
 
  sees trade as a "powerful engine for growth and jo b creation" and will "tailor trade and investment 
policy for those countries most in need".12 
2.13.  DG Trade maintains the Civil Society Dialog ue, which provides registered stakeholders with 
an opportunity to participate in meetings with the Commission on trade and trade-related issues. 
In addition, DG Trade holds public consultations on major policy initiatives where participation is 
open to EU and non-EU parties. Proposed regulations are published in the Official Journal of the 
European Union  in the C series; and the final regulations are published in the L series. The 
Commission indicated that its major political priorities, including legislative proposals, are 
presented in its Annual Work Programme; roadmaps are also available on the internet providing 
details of the content and timing of each planned regulatory initiative, including public stakeholder 
consultations and impact assessments.13 
2.14.  The Commission carries out impact assessment analysis to support its decision-making for 
all proposals with significant direct impact, including in the trade policy area.14 In terms of trade 
agreements, up to four major types of evaluation may be conducted during the life of a trade 
agreement. At the stage of negotiations, the Commission carries out "trade sustainability impact 
assessments" (SIAs) to analyse the economic, envi ronmental and social impacts of the proposed 
trade agreements for both the EU and its trading partners. SIAs, which inform on-going 
negotiations, are independent studies conducted by external consultants, involving comprehensive 
consultation of stakeholders and taking into account their knowledge and concerns both in the EU and in the trading partner. SIAs are also published online.
15 Once the negotiations are concluded 
and before signature of the agreement, an economic analysis on the consequences of the proposed 
deal for the EU is prepared for the European Parliament and the Council. After sufficient time has 
passed, the Commission will carry out an ex-post  evaluation of a trade agreement.16 
2.3  Trade Agreements and Arrangements 
2.3.1  WTO 
2.15.  According to the Commission, the EU conti nues to see the WTO and the multilateral trading 
system as the centrepiece of its trade policy, and attaches great importance to the conclusion of 
negotiations on the Doha Development Agenda. In this regard, the EU has firmly underlined the 
importance of preparing a post-Bali work progra mme within the prescribed deadline, which puts 
the WTO on a firm path towards the conclusion of the Round. 
2.16.  The EU is an original Member of the WTO and each EU member State is also a Member. The 
Commission considers that the WTO remains the EU's most important asset in dealing with 
globalization, particularly in times of crisis.17 The EU, through the European Commission, 
represents all the member States in the WTO. The EU is a contracting party to the Agreement on 
Government Procurement (GPA), a participant in  the Information Technology Agreement (ITA), 
and a signatory to the Agreement on Trade in Civil Aircraft. The trade policies of the EU have been 
reviewed eleven times by the WTO; the last review was in July 2013. 
2.17.  The current certified tariff schedule is the EU-15, effective 27 October 2012.18 The EU's tariff 
concessions and agricultural commitments regarding agricultural market access, domestic support, and export subsidies to reflect the enlargement from 15 to 28 member States have not yet been formally agreed in the WTO. The EU submitted its EU-25 schedule for certification on 
                                               
12 European Commission documents COM (2010) 612 final, 9 November 2010, COM (2012) 22 final, 
27 January 2012, and Commission contribution to the February 2013 European Council Debate on Trade, 
Growth and Jobs, (viewed at: http://trade.ec.europa.eu/doclib/docs/2013/april/tradoc_151052.pdf ). 
13 European Commission online information, "E uropean Commission at work". Viewed at: 
http://ec.europa.eu/atwork/key-documents/index_en.htm.  
14 European Commission online informatio n, "Impact Assessment". Viewed at: 
http://ec.europa.eu/smart-regulation/impact/index_en.htm .  
15 European Commission online information, "Sustainability impact assessments". Viewed at: 
http://ec.europa.eu/trade/analysis/sustainability-impact-assessments/assessments/ . 
16 European Commission document COM(2012) 22 final, 27 January 2012. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2012/january/tradoc_148992.EN.pdf . 
17 Commission Contribution to the February 2013 European Council Debate on Trade, Growth and Jobs, 
(viewed at: http://trade.ec.europa.eu/doclib/docs/2013/april/tradoc_151052.pdf).  
18 WTO document WT/Let/868, 30 October 2012. WT/TPR/S/317 • European Union 
 
- 29 - 
 
  25 April 201419 and has initiated the procedures for the EU-28 schedule (section 3.1.4.1). With 
regard to the certified EU-25 services schedule, 18 EU member States have ratified the schedule.20 
2.18.  In February 2015, the EU began the process of accepting the protocol for the amendment to 
the Marrakesh Agreement for the WTO Agreement on Trade Facilitation (TFA).21 
2.19.  The EU submitted numerous notifications to  the WTO during the review period, covering, 
inter alia , agriculture, trade remedies, technical regulations, regional trade agreements, and 
preferential rules of origin (Table A2.1). 12 noti fications on measures of trade in services were 
submitted for the sake of transparency.22 
2.20.  During the period under review, the EU wa s involved in seven new dispute settlement cases 
as a respondent, and in seven new cases as a complainant under the Dispute Settlement Mechanism (Table A2.2). In addition, the EU was a third party in nine new cases. 
2.3.2  Regional and preferential agreements 
2.3.2.1  Reciprocal preferences 2.21.  The EU considers that negotiating bilateral agreements with key partner countries is a key 
priority for the EU to open up more market op portunities, and thus achieve economic growth and 
job creation.
23 As at end-December 2014, the EU had notified to the WTO 37 regional trade 
agreements (RTAs) in force24, among which 23 agreements cover goods and 14 cover goods and 
services. 
2.22.  During the period under review, the EU began application of four new bilateral trade 
agreements.25 All these agreements cover broader topics than tariff concession as summarized 
below. 
2.23.  The Association Agreements, including the "deep and comprehensive free trade 
agreements" (DCFTA) with Georgia and Moldova, have been applied since 1 September 2014.26 
According to the EU, DCFTA goes beyond "pure" tr ade (i.e. removals of import and export duties, 
and removal of obstacles to trade in services), it "comprehensively" covers areas of trade-related 
policies such as public procurement, competition, intellectual property; and approximates the trade and trade-related policies of these partners in line with the EU acquis, in areas such as sanitary 
and phytosanitary (SPS) measures, technical requirements and standards, customs procedures 
and trade facilitation.
27 
2.24.  Application of the Association Agreement between the EU and the Central American region 
(i.e. Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama as one party) started 
in 2013. The Agreement is the first region-to-regi on Association Agreement which relies on three 
mutually-reinforcing pillars, namely politica l dialogue, cooperation, and a trade agreement.28 The 
                                               
19 WTO document G/MA/TAR/RS/357, 25 April 2014. 
20 WTO document S/C/M/111, 21 November 2012. 
21 European Commission document, COM(2015) 50 Final, 6 February 2015. 
22 The EU states that, given there is no common understanding among WTO Members on when a 
measure "significantly affects trade in services" within the meaning of GATS Article III:3 and that the EU cannot make a positive determination on this issue, the EU notifies measures that may be relevant to trade in services without prejudice to the interpretation of th e phrase "significantly affects trade in services" in 
Article III:3. 
23 European Commission document, MEMO /13/1080, 3 December 2013. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2012/november/tradoc_150129.pdf . 
24 WTO online information, "R TA Database". Viewed at: http://rtais.wto.org/UI/PublicAllRTAList.aspx .  
25 These four association agreements are under prov isional application due to pending completion of 
parliamentary formality on both sides. 
26 Both Association Agreements were signed on 27 June 2014. 
27 European Commission online information. Viewed at: http://ec.europa.eu/trade/policy/countries-and-
regions/countries/georgia/ , and http://eeas.europa.eu/delegation s/moldova/documents/eu_moldova/ 
argumentaire_en.pdf . 
28 WTO document WT/REG332/N/1, and S/C/N/680, 27 February 2013. WT/TPR/S/317 • European Union 
 
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  trade pillar includes tariff concessions, servic es trade concessions, SPS measures, government 
procurement, and protection of intellectual proper ty rights (including geographical indications).29 
2.25.  The FTA with Colombia and Peru has also been applied since 2013. This FTA contains 
provisions on, inter alia,  tariff concessions, services trade concessions, government procurement, 
SPS measures, TBT measures, IPR protection, and trade and sustainable development, as well as a 
comprehensive dispute settlement mechanism.30 
2.26.  During the period under review, the EU concluded FTA negotiations with Canada 
(September 2014), Ecuador (July 2014), and Singapore (October 2014). With regard to ongoing 
negotiations, the EU launched new negotiations with Japan (March 2013), Morocco (March 2013) 
Thailand (March 2013) and the United States (July 2013). The EU continues negotiating FTAs with India, Malaysia, MERCOSUR, and Viet Nam. 
2.27.  The EU's reciprocal trade relations with the African, Caribbean and Pacific (ACP) countries 
are governed by Economic Partnership Agreements (EPAs). The EPA process involves seven regional configurations: CARIFORUM, Pacific, Central Africa, West Africa, Southern African 
Development Community (SADC), East African Community (EAC), and Eastern and Southern Africa 
(ESA).  
2.28.  As at end-December 2014, EPAs with all CARIFORUM countries (except Haiti), four countries 
in ESA, Papua New Guinea and Fiji in the Pacific region, and Cameroon in Central Africa are under 
implementation. In addition, EPAs with West Africa, SADC, and EAC were concluded in 2014, which will replace interim EPAs that some of the partners had concluded with the EU.
31 Countries that do 
not apply the EPA in ESA, Central Africa, and Pacific may receive unilateral preferences under the 
GSP32; least developed countries (LDCs) continue to benefit from the duty-free and quota-free 
(DFQF) access to the EU market under the Everything But Arms (EBA) arrangement of the GSP (see section 2.3.3). 
2.29.  The EU maintains the European Economic Ar ea (EEA) agreement with Iceland, Liechtenstein 
and Norway, allowing these countries to participate in the internal market for free movement of goods, capital and labour. The EU also has customs unions with Andorra, San Marino, and 
Turkey.
33 With regard to Switzerland, the EU has several bilateral agreements covering, inter alia , 
the free movement of persons, trade in agricult ural products, public procurement, technical 
barriers to trade, transport, research, taxati on of savings, and fighting against fraud. 
2.3.3  Unilateral preferences 
2.30.  The new "Generalised Scheme of Preferences" (GSP) began to apply on 1 January 2014.34 
According to the Commission, the new GSP focu sses preferences on countries-most-in-need and 
addresses the issue of preference erosion. The GS P concentrates the benefits on fewer eligible 
countries - countries classed as high or upper middle income for the most recent three years by 
the World Bank or countries having equivalent or better preferential access under other arrangements were removed from the list of beneficiary countries.
35 Hence, the number of GSP 
beneficiaries decreased from 178 under the previous GSP to the current 92, and is expected to 
decrease further. However, some of the removed countries will be covered by other preferential 
                                               
29 European Commission online information, "EU-Central America association agreement". Viewed at: 
http://trade.ec.europa.eu/do clib/press/index.cfm?id=689 . 
30 European Commission online information, "Countri es and regions: Andean Community". Viewed at: 
http://ec.europa.eu/trade/policy/countries-and-regions/regions/andean-community/ . 
31 The interim EPA between the EU and SADC was never ratified. 
32 If the income level of these countries are lower than the upper middle income ranked by the World 
Bank. 
33 European Commission online information, "Agreements". Viewed at: 
http://ec.europa.eu/trade/policy/countries -and-regions/agreements/#_customs-unions .  
34 Regulation (EU) No. 978/2012 of the European Parliament and the Council, 25 October 2012 (OJ L 
303/1, 31 October 2012). 
35 The Commission pointed out the dist inction between "eligible countries" and "beneficiary countries". 
According to the Commission, high- or upper-middle-income economies remain "eligible" for the GSP but do 
not receive tariff preference as "beneficiaries". In case the situation changes (e.g. no longer classified as high-
or upper-middle-income, or other pref erential arrangements terminated), the "eligible countries" will be back 
on the list of beneficiaries. WT/TPR/S/317 • European Union 
 
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  arrangements such as free-trade agreements or economic partnership agreements 
(see section 2.3.2). 
2.31.  On the criterion of income level, 20 countries (or customs territories) were removed from 
the revised GSP list of beneficiaries.36 Moreover, Azerbaijan and Iran (since 23 February 2014); 
China, Ecuador, Maldives, and Thailand (since 1 January 2015) no longer benefit from the GSP37, 
and Botswana, Namibia, and Turkmenistan will cease to benefit from 1 January 2016.38 On the 
criterion of alternative market access, 34 countries  are no longer GSP beneficiaries as from the 
outset39, while, Colombia, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama, and 
Peru will not be among the GSP beneficiaries from 1 January 2016.40 
2.32.  The EU's GSP consists of three arrangements: 
• standard GSP, which provides tariff preferences to beneficiary developing countries;  
• GSP+, which offers additional tariff reductions to "vulnerable" countries that ratify and 
effectively implement core international co nventions in the fields of human rights, 
labour rights, environmental protection, and good governance; and  
• Everything But Arms (EBA), which offers duty-free and quota-free access for all 
products except arms and ammunitions from LDCs. 
2.33.  A GSP beneficiary that meets the criteria specified in the GSP Regulation41 may formally 
apply for GSP+ status. GSP+ beneficiary countries are then required to maintain ratification and 
effectively implement the relevant conven tions in order to maintain preferences.42 At end-
March 2015, there are 13 countries on the GSP+ arrangement (Armenia, Bolivia, Cabo Verde, Costa Rica, El Salvador, Georgia
43, Guatemala, Mongolia, Pakistan, Panama, Paraguay, Peru, and 
the Philippines).44 The GSP+ status for Ecuador was terminated at end-2014 when the country 
exited the GSP. Similarly, Costa Rica, El Salvad or, Guatemala, Panama, and Peru will be removed 
from GSP+ beneficiaries at end-2015 (see above). 
2.34.  According to Regulation (EU) No. 978/2012, GSP, GSP+ and EBA treatment may be 
temporarily withdrawn on a number of grounds, including: serious and systematic violation of human and labour rights; exported goods being ma de by prison labour; serious shortcomings in 
customs control; serious and systematic unfair trading practices, including those affecting the 
supply of raw materials that have an adverse effect on the EU's industry and have not been addressed by the beneficiary country; and serious and systematic infringement of the objectives 
                                               
36 These countries/trading partners are: Argentina; Bahrain; Belarus; Brazil; Brunei Darussalam; Cuba; 
Gabon; Kazakhstan; Kuwait; Libya; Malaysia; Macao,  China; Oman; Palau; Qa tar; Russian Federation; 
Kingdom of Saudi Arabia; United Arab Emirates, Urugua y; and Venezuela. See Euro pean Commission online 
information, viewed at: http://trade.ec.europa.eu/doclib/docs/2013/december/tradoc_152015.pdf  [30/03/15]. 
37 Commission Delegated Regulation (EU), No. 154/2013, 18 December 2012 (OJ L 48/1, 
21 February 2013), Commission Delegated Regulation (EU), No. 1015/2014, 22 July 2014 (OJ L 283/20, 27 September 2014), and Commission Delegated Regulation (EU), No. 1421/2013, 30 October 2013 (OJ L 355/1, 31 December 2013)  
38 Commission Delegated Regulation (EU), No. 1015/2014, 22 July 2014 (OJ L 283/20, 
27 September 2014), and Commission Delegated Regulation (EU), No. 1016/2014, 22 July 2014 (OJ L 283/23, 27 September 2014). 
39 These countries are: Algeria, Egypt, Jordan, Leba non, Morocco, Tunisia, Belize, St. Kitts and Nevis, 
Bahamas, Dominican Republic, Antigua and Barbuda, Do minica, Jamaica, Saint Lucia, Saint-Vincent and the 
Grenadines, Barbados, Trinidad and Tobago, Grenada, Guyana, Surinam, Côte d'Ivoire, Ghana, Cameroon, 
Kenya, Seychelles, Mauritius, Zimbabwe, Namibia, Botswana, Swaziland, Papua New Guinea, Fiji, Mexico, and South Africa. See European Commission online information, viewed at: http://trade.ec.europa.eu/doclib/docs/2013/december/tradoc_152015.pdf  [30/03/15]. 
40 Commission Delegated Regulation (EU), No. 1015/2014, 22 July 2014 (OJ L 283/20, 
27 September 2014). 
41 Regulation (EU) No. 978/2012, Article 9. 
42 Article 15, Regulation (EU) No. 978/2012. 
43 Georgia's GSP+ status is in a transition period until September 2016 due to alternative market access 
opportunities through the FTA with the EU. As per Article 5 of the GSP Regulation 978/2012, a GSP beneficiary which begins applying another preferen tial market access arrangement with the EU is given a 2-year transition 
period during which it benefits from bo th the GSP and that new arrangement. 
44 Commission Delegated Regulation (EU) No. 1/2014, 28 August 2013 (OJ L 1/1 4 January 2014), 
Commission Delegated Regulation (EU) No. 182/2014, 17 December 2013 (OJ L 57/1, 27 February 2014), and Commission Delegated Regulation (EU) No. 1386/2014, 19 August 2014 (OJ L 369/33, 24 December 2014). WT/TPR/S/317 • European Union 
 
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  adopted by Regional Fishery Organisations or other international arrangements. If the unfair 
trading practices are subject to EU anti-dumping or countervailing measures, GSP treatment of the 
products concerned may not be withdrawn. Temporar y withdrawal is preceded by adoption of an 
implementing act to initiate the procedure for temporary withdrawal, publication of a notice in the 
Official Journal  and, during the subsequent investigation, the country concerned must be given 
"every opportunity to cooperate during the [s ix month] monitoring and evaluation period".45 In 
June 2013, the EU reinstated Myanmar into the GSP scheme46; as at end-March 2015, only Belarus 
remained temporarily withdrawn from the GSP. 
2.35.  The EBA arrangement has no expiry date47 while the standard GSP and GSP+ beneficiaries 
are valid for ten years unless they graduate from the scheme.48 Products covered in the GSP are 
reviewed every three years: imports of a particular product section from a beneficiary country no 
longer have preferential access when they exceed a certain level, defined as a percentage of total 
imports of that product from all GSP beneficiaries. The current threshold for product graduation is 17.5% (and 14.5% for textiles). Product graduation applies only to standard GSP beneficiaries, not 
to GSP+ and EBA countries. A total of 44 sectors from eight countries were set to graduate in the 
period of 2014-16.
49 However as some of these countries qualified for GSP+ and/or exited the 
scheme due to income criterion in the meantime, currently only 11 sectors from four countries 
have effectively graduated. 
2.36.  Since 2011 the GSP rules of origin remained largely unchanged. 2.37.  Regarding other unilateral measures outside the GSP, tariff preferences were granted as the 
Autonomous Trade Measures (ATMs) to six countries in the Western Balkans in 2000 and 
subsequently renewed in 2005 and 2011 until the end of 2016.
50 Specific unilateral preferences 
were also granted to Moldova in 2008 and subsequently extended until end-2015. In April 2014 Ukraine was granted unilateral preferences based on the EU tariff dismantlement foreseen in the 
EU-Ukraine DCFTA
51; these preferences apply until the end-2015.52 
2.4  Investment Regime 2.4.1  Business environment 
2.38.  The free movement of goods, persons, servic es and capital within the EU is essential for the 
functioning of the internal market. 
2.39.  The Treaty on the Functioning of the Europe an Union (TFEU) prohibits restrictions on capital 
movements among EU member States, and between EU and non-EU members
53; it also prohibits 
restrictions on payments among EU member States and between member States and third 
countries. Exceptions for applying restrictions may be granted in "exceptional circumstances" when such measures are strictly necessary; and the measures must not be applied for longer than six 
months.
54 
2.40.  Under the TFEU, no restrictions are allowed on the "freedom of establishment" of an 
EU national in the territory of another member  State. Freedom of establishment extends to 
                                               
45 Article 19, Regulation (EU) No. 978/2012. 
46 Regulation (EU) No. 607/2013 of the European Parliament and the Council, 12 June 2013 (OJ L 
181/13). 
47 Regulation (EU) No. 978/2012, Article 43(3). 
48 The EU will offer at least a one-year transition  period for graduation and/or changes in the 
beneficiaries' list. 
49 Commission Implementing Regulation (EU) 1213/2012, 17 December 2012 (OJ L 348/11, 
18 December 2012). 
50 European Commission online information, "Autonomous trade measures". Viewed at: 
http://ec.europa.eu/enlargement/policy/glossa ry/terms/association-trade-measures_en.htm .  
51 WTO document WT/REG353/N/1, 2 July 2014. 
52 European Commission online information, "C ountries and regions – Ukraine". Viewed at: 
http://ec.europa.eu/trade/policy/countries-and-regions/countries/ukraine/  [30/03/15]. 
53 Restrictions on direct investme nt from non-EU members that were  in place before December 1993 
(December 1999 for Bulgaria, Estonia, and Hungary) are ex empt from this prohibition. See Article 64(1), TFEU. 
54 Articles 65 and 66, TFEU. WT/TPR/S/317 • European Union 
 
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  EU subsidiaries affiliated to non-EU companies55, but not to branches or agencies of non-EU 
companies. 
2.41.  Despite the common provisions of the EU legislation, a business may face different 
regulatory restrictions depending on where it is established. It was estimated that up to one-third 
of the administrative burden linked to EU legislation stems from implementation measures in 
member States.56 Moreover, according to the OECD, the heterogeneity of rule-setting across 
member States and high national barriers, especially in some services sectors, makes it hard for 
businesses to adapt to each national regulation.57 In June 2013, Germany passed new immigration 
rules which aim to cut red tape for people in target industries, allowing them to easily obtain recognition of their qualifications in Germany. On the other hand, France passed a bill in the National Assembly in October 2013 imposing penalties on companies that shut down operations 
deemed economically-viable; at end-March 2015 th is bill was still under debate in the French 
Senate. 
2.42.  Some member States such as France, Germany, and the United Kingdom maintain FDI 
review procedures for national security purpos es. These procedures were amended during the 
period under review: in September 2013, Germany streamlined its review mechanism for FDI, reducing data requirements for sector-specific re views; and in May 2014, France amended the list 
of activities subject to FDI review. In 2014, Italy and Portugal also amended or adopted new 
legislation to review investment in strategic sectors such as defence, energy, transport and communication. 
2.43.  According to the OECD, in 2013, Luxembourg, Portugal, Slovenia, Romania, and the 
Czech Republic had the most open foreign investment regime among the member States, while 
Poland and Austria are above the OECD average for restrictions.
58 
2.4.2  Foreign investment regime 
2.44.  The TFEU provides that foreign investment policy is an integral part of the common 
commercial policy, which remains an exclusive comp etence of the EU. During the review period, 
the EU is still in the process of developing its common investment policy. 
2.45.  Under the EU exclusive competence, investment agreements with non-EU member States 
are negotiated at the EU level. In the EU's view, investment negotiations can take two forms: to include investment provisions in the ongoing trade negotiations and make investment protection an integral part of the free-trade agreements (e.g. FTAs with Canada and Singapore); or to pursue 
stand-alone agreements (e.g. with China and Myanmar). EU member States may be authorized to 
negotiate and conclude bilateral investment treaties (BITs) with countries not immediately scheduled for EU-wide investment negotiations, or to renegotiate existing agreements; all member 
States' BITs that entered into force before 9 January 2013 are "grandfathered", according to the 
Regulation (EU) No. 1219/2012.
59 
2.46.  There were some 1,400 BITs between the EU member States and third countries before the 
TFEU entered into force.60 Information about member States' BITs signed/in force is published 
annually in the Official Journal.61 
2.47.  The Commission considers that investor-to-state dispute settlement (ISDS) mechanisms 
ensure effective enforcement of investment agreements. Investor-to-state dispute settlement 
forms a key part of member States' BITs, and will be included in future EU investment agreements 
                                               
55 Articles 49 and 54, TFEU. 
56 European Commission press release, IP/14/682, 18 June 2014. Viewed at: 
http://europa.eu/rapid/press-release_IP-14-682_en.htm . 
57 OECD (2014), OECD Economic Survey: Eu ropean Union, April 2014. Viewed at: http://www.oecd-
ilibrary.org/economics/oecd-economic-surveys-european-union-2014_eco_surveys-eur-2014-en . 
58 OECD online information,  "FDI Regulatory Restrictiveness Index". Viewed at: 
http://www.oecd.org/in vestment/fdiindex.htm . 
59 EU member States may maintain in force these agreements notwithstanding the EU's competences 
relating to investment, until th ey are replaced by investment agreements concluded by the EU. 
60 European Commission online information, "EU In vestment Policy: State of Play". Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2013/april/tradoc_150853.pdf . 
61 Notice from Member States (OJ C 169/1, 5 June 2014). WT/TPR/S/317 • European Union 
 
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  with other countries. In preparation for the applic ation of an ISDS mechanism, the EU adopted a 
regulation to establish a legal and financial framework for investor-to-state dispute settlement on 23 July 2014. This regulation provides legal and fi nancial certainty for foreign investors in the EU 
when they have dispute complaints against the EU or its member States, and ensures that any 
final award or settlement award is paid promptly to the investor, regardless of the decisions on the 
allocation of financial responsibility. 
2.5  Aid for Trade 
2.48.  With regard to development cooperation, the EU's policy aims to reduce and eradicate long-
term poverty. In this area, the EU works in a partnership with its member States to complement each other's policies.
62 
2.49.  According to the 2014 EU Aid for Trade Repo rt, the EU, together with its member States, 
was the world's largest provider of Aid for Trade (AfT) in the world in 2012 (€11.6 billion), 
accounting for around 32% of total AfT flows.63 Since 2008, the EU and its member States have 
also exceeded the target to provide €2 billion a nnually for trade-related assistance (TRA). In 2012, 
60% of global TRA commitment was from the EU and its member States, with a total of €2.5 
billion; the EU support to trade facilitation repr esented more than 18% of the EU TRA and almost 
5% of EU AfT. 
2.50.  Building Productive Capacity (BPC) and Trade-Related Infrastructure (TRI) represent the 
most important components of the collective EU AfT, accounting for 46% each in 2012. Other EU AfT activities include Trade Policy and Regulation  (3%) and Other Trade-Related Needs (5%). With 
regard to geographical coverage, Africa accounted  for the largest share of BPC and TRI aid at 36% 
(€3.9 billion), followed by Asia (17%). The EU actively continues to support capacity building in 
LDCs; for instance, it participated in the follow-up of the WTO's Trade Policy Review of Myanmar. AfT from the EU to LDCs accounted €1.8 billion in 2012. 
2.51.  The EU, together with the member States, is the largest donor to trade-facilitation-related 
assistance under the AfT category of Trade Polic y and Regulation. In 2010-12, the region of south 
Sahara received the most aid for trade facilitation (58.6% of the three-year total) followed by 
North and Central America (9.8%), Europe (7.5%)  and Oceania (6.9%). At the same time, the 
share in the yearly total of the south Sahara region decreased steadily: from 66% in 2010 to 40% in 2012. Other regions have emerged as priority targets for these programmes: in 2012, South America, Asia, and non-EU European countries accounted for 17%, 11%, and 6%, respectively. In 
November 2014, the EU collectively contributed €10 million to the Trade Facilitation Support 
Programme (TFSP), accounting for more than a third of the current total commitment to the TFSP.
64 
2.52.  According to the Commission, with regard to improving the effectiveness of AfT, the EU 
intends to pay more attention to LDCs and countries most in need and the EU will explore approaches to provide increased support to LDCs in order to strengthen their capacities in 
formulating AfT requests; and supporting developing countries and, in particular, LDCs in making 
better use of trade needs assessments to improve the effectiveness of AfT actions at the country level.
65 
 
                                               
62 Article 208, TFEU. 
63 European Commission document SWD(2013) 273, 16 July 2013. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2013/november/tradoc_151890.pdf .  
64 European Commission online information. Viewed at: 
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1202 .  
65 European Commission document, SWD (2013) 273, 16 July 2013. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2013/november/tradoc_151890.pdf . WT/TPR/S/317 • European Union 
 
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  3  TRADE POLICIES AND PRACTICES BY MEASURE 
3.1  Measures Directly Affecting Imports 3.1.1  Customs procedures 3.1.  The Customs Union is an integral part of the Common Commercial Policy under the exclusive 
competence of the EU. Customs laws and proced ures are harmonized and monitored at the EU 
level, with the national customs administrations in the member States responsible for implementing the law. The Trade Contact Group is  the main framework for regular consultations 
between the European Commission and economic operators on EU customs matters. The 
Commission also maintains a website designated for customs consultations.
1 
3.2.  As of end-2014, the Community Customs Code of 1992 (as amended) and its implementing 
provisions of 1993 (as amended) are applied as the basic customs legislation of the EU.2 In 2008, 
the Community Customs Code was replaced by the Modernised Customs Code which was to 
become applicable by 24 June 2013.3 However, the Commission proposed, and the European 
Parliament and the Council agreed, that the Modern ised Customs Code should be repealed before 
its application. There were several reasons for this decision, including the need to give public 
administrations and economic operators in the member States the time to make the necessary investments and allow the introduction of electron ic processes and the need to align the Customs 
Code with the Treaty on the Functioning of the European Union (TFEU).
4 Following the 
Commission's proposal, the Union Customs Code (UCC) was adopted in 2013 and entered into force on 20 October 2013 with its substantive provisions to apply on 1 May 2016 when the delegated and implementing acts of the Commission are to be adopted and in force.
5 According to 
the Commission, "shaping of the provisions within the Acts is done, in line with Articles 290 and 
291 of the TFEU, through proper involvement of the member States and the business community. 
Their involvement started in January 2014 upon the submission of the draft UCC Delegated Act 
(DA)6 and UCC Implementing Act (IA)7 that are still under discussion."8 
3.3.  Under the EU legislation, the term "customs procedure" means: release for free circulation; 
transit; customs warehousing; inward processing; processing under customs control; temporary 
admission; outward processing; and exportation. Imported goods may be released for customs 
procedures (e.g. transit or inward processing) or released for free circulation once all formalities are completed and any duties legally due (i.e. tariff duties, value added tax (VAT), and excise duties (section 3.1.5)) are paid or secured.  
3.4.  Registration with the customs authorities of member States is required for all economic 
operators established in the EU and involved in the activities covered by the customs legislation, and for non-established economic operators if they perform one of the activities listed in 
Article 4l(3) of the Customs Code Implementing Regulation. An Economic Operator Registration 
and Identification (EORI) number is issued by the national authorities. EORI numbers are unique to each operator, and recognized throughout the EU.  
                                               
1 European Commission online information,  "Customs consultations". Viewed at: 
http://ec.europa.eu/taxation_customs/common/consultations/customs/index_en.htm . 
2 Council Regulation (EEC) No. 2913/92, 12 October 1992 (OJ L 302, 19 October 1992); and 
Commission Regulation (EEC) No. 2454/93, 2 July 1993 (OJ L 253, 11 October 1993). 
3 Regulation (EC) No. 450/2008 of the European Parliament and of the Council, 23 April 2008 (OJ L 
145/1, 4 June 2008). 
4 European Commission document COM(2013) 193 Final 2013/0104 (COD), 10 April 2013. Viewed at: 
http://eur-lex.europa.eu/legal-content /EN/TXT/PDF/?uri=CELEX:52013PC0193&from=EN . 
5 Regulation (EU) No. 952/2013 of the European Parliament and of the Council, 9 October 2013 (OJ L 
269/1, 10 October 2013). 
6 European Commission document TAXUD/UCC-DA/2014-1, Consolidated preliminary draft of the Union 
Customs Code Delegated Act, 13 January 2014. Viewed at: http://ec.europa.eu/taxation_customs/ 
resources/documents/customs/customs_code/ucc_delegated_act_2014.pdf . 
7 European Commission document TAXUD/UCC-IA/2014-1, Consolidated preliminary draft of the Union 
Customs Code Implementing Act, 13 January 2014. Viewed at: http://ec.europa.eu/taxation_customs/ 
resources/documents/customs/customs_code/ucc_implementing_act_2014.pdf . 
8 EU Commission online informatio n, "The Union Customs Code: a re cast of the Modernised Customs 
Code". Viewed at: http://ec.europa.eu/taxation_customs/customs/customs_code/union_customs_code/index 
_en.htm  [18/12/14]. WT/TPR/S/317 • European Union 
 
- 36 - 
 
  3.5.  Traders, or their representatives that are established in the EU, must lodge import 
declarations for their imports with the customs office  in a member State, either electronically or in 
writing. Persons that are not established in the EU may lodge customs declarations for transit or for temporary admission.
9 According to the Commission, more than 98% of customs declarations 
submitted in the EU are electronic.10 In accordance with the relevant provisions11, declarants may 
be authorized, subject to conditions, to lodge incomplete declarations, simplified declarations, or declarations under local clearance procedures.
12 
3.6.  According to the Security Amendment to the Customs Code13, pre-arrival declarations are 
encouraged by the EU. The carrier14 of imported goods must lodge at the "customs office of first 
entry" electronic Entry Summary Declarations (ENS) for goods from outside the EU, except for goods from countries that have a security agr eement with the EU, i.e. Norway, Switzerland, 
Liechtenstein, and Andorra.
15 In some member States, an ENS may be accepted at another 
customs office (customs office of lodgement), if the ENS is electronically communicated or made available to the customs office of entry.
16 The ENS must be submitted electronically in advance; 
otherwise, the imported goods should be declared upon arrival at the border, which may delay 
customs clearance pending the results of risk analysis for safety and security purposes. 
3.7.  When customs procedures involve more than one customs authority in the EU, a single 
authorization may be granted for a customs procedure with economic impact (e.g. customs 
warehousing, inward processing, processing und er customs control, temporary importation, 
outward processing) or end-use relief. A person may also apply for a single authorization for simplified procedures which allows the applicant to use local clearance procedures or the simplified 
declaration procedure in more than one member State.
17 The current single authorization for 
simplified procedures will be replaced by auth orization for centralised clearance under the UCC.18 
3.8.  The Commission notes that the UCC (and th e related delegated and implementing acts) will 
streamline customs legislation and procedures, offer greater legal certainty and uniformity to 
businesses, simplify customs rules and procedures and facilitate more efficient customs transactions in line with modern-day needs, and complete the shift by Customs to a paperless and 
fully electronic environment. 
3.9.  The EU continues to implement its electronic customs initiative which, inter alia  aims to 
improve the efficiency and effectiveness of cu stoms procedures, hence to facilitate trade.
19 The 
electronic customs initiative is comprised of a number of individual projects, such as the Automatic 
Import/Export System and the Single Window. The EU Single Window is an initiative with a phased 
                                               
9 A non-established person is perm itted to lodge a customs declaration for release for free circulation 
provided that he appoints a customs representative established in the EU unless there are not some specific 
requirements that the declaration is lodged by a specific person. 
10 European Commission online information, "the EU Customs Union". Viewed at: 
http://europa.eu/pol/pdf/flipbook/en/customs_en.pdf .  
11 Commission Regulation (EC) No. 1192/2008, 17 November 2008 (OJ L 329, 6 December 2008). See 
also Community Customs Code, and Article 253, Customs Code Implementing Provision, Article 76. 
12 Using a simplified declaration procedure or the local clearance procedure is conditional on the lodging 
of electronic customs declarations and notifications. 
13 Regulation (EC) No. 648/2005 of the European Parliament and of the Council, 13 April 2005 (OJ L 
117/13, 4 May 2005); and Commission Regulation (EC) No. 1875/2006, 18 December 2006 (OJ L 360/64, 19 December 2006). 
14 The carrier is the person who brings, or who assume s responsibility for the carriage of, the goods into 
the EU. See Articles 36b(3) and 183 of Customs Code. 
15 Article 181c of the Customs Code Implementing Regulation sets out several exceptions. 
16 A list of the member States that allow an ENS to be lodged in an office other than the customs office 
of entry is available from the European Co mmission online information. Viewed at: 
http://ec.europa.eu/ecip/documents/procedures/ics_office-lodgment-overview_en.xls . 
17 Article 1(13), CCIP. 
18 European Commission online information, "Single Authorisation for simplified procedures 
(SASP)/Centralised Clea rance". Viewed at: 
http://ec.europa.eu/taxation_customs/customs/procedu ral_aspects/general/centralised_clearance/index_en.ht
m [23/11/2014]. 
19 European Commission online informatio n, "Electronic Customs". Viewed at: 
http://ec.europa.eu/taxation_customs/customs/policy_issues/electronic_customs_initiative/index_en.htm .  WT/TPR/S/317 • European Union 
 
- 37 - 
 
  implementation approach20: the scope of the first phase was defined as the automated acceptance 
of electronic certificates; a pilot project accepting veterinary certificates (the Common Veterinary Entry Document (CVED)) was initiated in 2012 and has become operational since March 2014. 
3.10.  As indicated by the World Bank's Doing Business , the time needed to complete import 
process varies among member States: in more than half of the EU member States it takes less 
time than the OECD average; whereas for the others it takes more time; e.g. up to 19 days for Hungary.
21 The Commission pointed out that this time measurement covers the activities of 
customs as well as other bodies involved in the importing process (e.g. inland transport, port and 
terminal handling), and is calculated "from the vessel's arrival at the port of entry to the cargo's delivery at the warehouse". As reported by the Commission, a pilot project was carried out for measuring the time needed for customs to process a standard import customs declaration (from 
acceptance to the release of goods), which showed that 88% of import declarations lodged 
electronically under normal procedures were processed within one hour. Furthermore, customs procedures must be uniformly implemented although some variations in administration may occur. 
According to the Commission, any practices in a member State that are not in compliance with the 
EU customs legislation will be investigated by the Commission, and infringement procedures may be launched if necessary. 
3.11.  The EU member States may grant authorized economic operator (AEO) status, based on 
common criteria,
22 to interested economic operators involved in activities covered by customs 
legislation. There are three types of AEO certificates: AEO-C (AEO certificate – Customs simplifications); AEO-S (AEO certificate – Security and safety); and AEO-F (AEO certificate – 
Full).
23 The benefits of AEO status depend on the type of certificate granted to the economic 
operator24, and could include fewer customs controls, or easier admittance to simplified customs 
procedures. Participation in the authorized economic operator programme is voluntary, and only 
open to economic operators established in the EU. Economic operators from third countries can 
apply in the EU if they have subsidiaries established and having customs related activities in the EU.  
3.12.  AEO status granted by one member State is recognized by other member States.
25 When an 
AEO applies for a specific authorization for simplified procedure, the conditions and criteria which have already been examined are not examined again. As of 15 January 2015, 15,034 applicants had been granted AEO status.
26 
3.13.  The EU has signed AEO mutual recognition agreements (MRAs) with Switzerland 
(July 2009), Norway (September 2009), Japan (October 2010), Andorra (January 2011), the United States (June 2012), and China (May 2014) . Benefits of mutual rec ognitions vary among 
different MRAs, but in general they include fewer physical and documentary controls so as to avoid 
duplication of security and compliance controls. The MRAs on AEOs concerns only holders of AEO-S and AEO-F certificates in the EU. 
3.14.  Article 52 of the UCC states that customs authorities shall not impose charges for the 
performance of customs controls or any other application of the customs legislation during the official opening hours of their competent customs offices; the same article also establishes that customs authorities may have the right to charge certain fees where a specific service is actually 
                                               
20 European Commission online information, "Electro nic Customs: Individual Projects". Viewed at: 
http://ec.europa.eu/taxation_customs/customs/policy_issues/electronic_customs_initiative/it_projects/index_e
n.htm .  
21 World Bank online information, "Doing Bu siness, Trading across border". Viewed at: 
http://www.doingbusiness.org/data/ex ploretopics/trading-across-borders . 
22 Articles 5a (2), Council Regulation (EEC) No. 2913/92, 12 October 1992 and Article 14h-k, 
Commission Regulation (EEC) No. 2454/93, 2 July 1993. 
23 AEO – Full (Customs simplifications + Security and Safety). 
24 Article 14a, Commission Regulation (EEC) No. 2454/93, 2 July 1993. 
25 This does not automatically allow AEO to benefit from simplifications provided for in the customs rules 
in the other EU member States.  
26 Among which AEO-F, 7,508; AEO-C, 6,982; and AEO-S, 544. WT/TPR/S/317 • European Union 
 
- 38 - 
 
  provided to the operator. However the Court of Just ice of the EU (CJEU) rules that the fee must be 
proportionate and directly linked to the service provided.27 
3.15.  Under the EU customs legislation, nation al customs administrations must issue, upon 
request, advance written rulings on tariff classification and origin matters.28 Advance rulings, as 
either binding tariff information (BTI) or binding origin information (BOI), issued by the customs 
authorities of one member State are binding thro ughout the EU. BTIs are generally valid for six 
years, and BOIs for three years. The Commission maintains a public online database of advance 
written rulings on tariff classification.29 
3.16.  Appeals against customs matters must be lodged in the member State where the decision 
under dispute has been taken. Procedures for appeals are set out in national customs legislation, and vary across member States. Most member States require administrative review before a 
decision can be appealed judicially. The review by national courts of a decision taken by the 
customs administration of one member State is not binding on the customs administrations of other member States. However, the Commission note s that national courts regularly refer cases 
concerning tariff classification matters and interpretation of the EU customs provisions to the Court 
of Justice of the EU.
30 A recent CJEU ruling affirmed that everyone's right must be heard before 
the adoption of any decision liable to adversely affect his interest, and this right can be relied on 
directly by individuals before national courts. This ruling also specified the conditions that customs 
authorities must observe to ensure the rights as well as the consequences in case of infringement.
31 According to the Commission, this "right to be heard" before an adverse decision 
taken by the customs authorities is adequately reflected in the provisions of the UCC.32 
3.17.  According to the Commission, as at end-March 2015, the EU was in the process of preparing 
its full and timely implementation of the WTO Trade Facilitation Agreement. 
3.1.2  Customs valuation 
3.18.  There have been no changes in customs valuation legislation since the last Review. 
According to the Commission, the rules set out in the WTO Customs Valuation Agreement have been transposed directly into applicable EU legisl ation, i.e. Articles 28 to 36 of the Customs Code, 
and its related Implementing Provisions (Articles 141 to 181a and annexes 23 to 29). 
3.19.  The transaction value is the primary basis for customs value determination. The transaction 
values used are c.i.f. values. Around 95% of all import declarations are accepted in accordance with the transaction value method. 
3.20.  The Customs Valuation Section of the Customs Code Committee
33 publishes a compendium 
which contains commentaries and committee conclusions on specific valuation topics, including the interpretation of certain rules on customs valuation brought to the attention of the Committee. The 
compendium also provides an overview of European Union Court of Justice rulings in relation to 
                                               
27 See for example case 340/87 Commission vs. Italy, viewed at: http://eur-lex.eu ropa.eu/legal-
content/EN/TXT/?qid=1424936029687&uri=CELEX:61987CJ0340 ; also European Comm ission press release 
IP/13/1104, viewed at: http://europa.eu/rapid/press-release_IP-13-1104_en.htm . 
28 Article 12, Council Regulation (EEC) No. 2913/92, 12 October 1992. 
29 European Commission online information, "Eur opean Binding Tariff Information". Viewed at: 
http://ec.europa.eu/taxation_customs/dds2/ebti/ebti_home.jsp?Lang=en . 
30 European Commission online information, "European Court of Justice case law". Viewed at: 
http://ec.europa.eu/taxation_customs/common/infringements/case_law/index_en.htm .  
31 Court of Justice of the EU joined cases Joined cases C-129/13 (Kamino International Logistics BV) and 
C-130/13 (Datema Hellmann Worldwide Logistics BV v Staatssecretaris van Financiën), 3 July 2014. Summary can be found on Case Law in the field of Customs Union Law (Cases 2010-2014), viewed at: http://ec.europa.eu/taxation_customs/resources/documents/common/infringements/case_law/court_cases_cu
stoms_2010-2014.pdf .  
32 Article 22.6, UCC. 
33 The Customs Code Committee is the mechanism for controlling the Commission exercising its 
implementing powers on the customs related matters by  member States according to the “Comitology” (see 
section 2.1). Rules of procedure for the Customs Code Committee can be found in the European Commission 
document TAXUD/A2/2011/011 Final, 30 May 2012, viewed at: 
http://ec.europa.eu/taxation_customs/resources/documents/customs/procedural_aspects/general/community_
code/rulesofprocedureofthecommittee_en.pdf . WT/TPR/S/317 • European Union 
 
- 39 - 
 
  customs valuation. Although the last upda te of the compendium was published in 
September 200834, according to the Commission, additional  guidance continues to be developed. 
3.1.3  Rules of origin 3.21.  The EU maintains non-preferential and prefer ential rules of origin (RoO). During the period 
under review, the rules of origin remained largely unchanged.
35 
3.1.3.1  Non-preferential rules 3.22.  Non-preferential rules of origin are applied for the purposes of, inter alia , implementation of 
anti-dumping and countervailing measures, quanti tative restrictions, MFN tariff quotas, origin 
marking, contingency measures, and government procurement. 
3.23.  For non-preferential rules, in cases where more than one country is involved in the 
production of a good, the country of origin is determined as the country where the product 
underwent its "last substantial transformation", i.e. where the product "underwent their last, 
substantial, economically justified processing or working in an undertaking equipped for that purpose and resulting in the manufacture of a new product or representing an important stage of 
manufacture".
36 
3.1.3.2  Preferential rules 3.24.  Preferential rules of origin are those related provisions set out in unilateral trade 
arrangements (e.g. the GSP) and reciprocal trad e arrangements. The EU's preferential rules of 
origin vary among different reciprocal trade arrangements.
37 However, there are general rules that 
are applied in most cases while exceptions to the application of the "general rules" differ from one 
trade arrangement to another.38 Compared to those previously applied, the new GSP rules of 
origin have been simplified and modernized. The Commission indicates that the EU has been 
considering expanding its GSP-style RoO to other trade arrangements. 
3.25.  In cases where more than one country is involved in producing a product, under preferential 
rules, non-originating materials may obtain originating status as long as they have undergone 
"sufficient working or processing". The origin rules for "sufficient working or processing" are provided in the table of "list rules"
39, which may be expressed as: 
• a change of HS tariff heading or subheading criterion;  
• specific processing criterion; or 
• value added or ad valorem  criterion.  
                                               
34 European Commission online information, "Value of declared goods". Viewed at: 
http://ec.europa.eu/taxation_customs/customs/cus toms_duties/declared_goods/european/index_en.htm . 
35 Small changes have been made such as Myanmar being reinstated in the GSP rules of origin, some 
adaptations in the rules of origin in the GSP framework and non-preferential list ru les for solar panels were 
amended. See Regulation (EU) No. 607/2013 of the European Parliament and of the Council, 12 June 2013 (OJ L 181/13, 29 June 2013); Commission Implementing Regulation (EU) No. 530/2013, 10 June 2013 (OJ L 159/1, 11 June 2013); and Commission Implementing Regulation (EU) No. 1357/2013, 17 December 2013 (OJ L 341/47, 18 December 2013). 
36 Article 24, Council Regulation (EEC) No. 2913/92, 12 October 1992. 
37 European Commission online information, "D G TAXUD: Arrangements list". Viewed at: 
http://ec.europa.eu/taxation_customs/customs/customs_duties/rules_origin/preferential/article_779_en.htm . 
38 For a detailed summary, see the HMRC Notice 828, "Tariff Preferences: Rules of origin for various 
countries", 3 September 2013. Viewed at: https://www.gov.uk/government/publications/notice-828-tariff-
preferences-rules-of-origin-for-various-countries/notice-828-tariff-preferences-rules-of-origin-for-various-
countries . 
39 European Commission online information, “List Rules”. Viewed at: 
http://ec.europa.eu/taxation_customs/customs/customs_duties/rules_origin/preferential/article_776_en.htm  
[18/12/14]. WT/TPR/S/317 • European Union 
 
- 40 - 
 
  3.26.  Regarding the value added criterion for obtaining originating status, there are several rules 
on cumulation of origin. Cumulation allows countries to work together while the preference is still maintained: 
a. bilateral cumulation: materials originating in the donor country or partner country may 
be used for cumulation purposes;  
b. diagonal or regional cumulation: materials originating in a third country belonging to a 
system or group of cumulation may be used for cumulation purposes; and 
c. full cumulation: processing operations carried out in the countries belonging to a system 
or group of cumulation may be considered together for cumulation purposes. 
3.27.  Bilateral cumulation is applied to reciprocal trading agreements as well as to unilateral 
regimes such as the GSP and the Autonomous Trade Measures (ATMs). The EU's overseas 
countries and territories (OCT), ACP countries (including South Africa) as well as Algeria, Morocco, 
and Tunisia have access to full cumulation. Common origin is established for industrial products in the European Economic Area. 
3.28.  Diagonal cumulation prevails in the agr eements with EFTA countries, the Faroe Islands, 
Mediterranean countries, Turkey, and the Western Balkans.
40 As a form of diagonal cumulation, 
GSP beneficiary countries may use materials under cumulation of origin with countries in the same 
regional group; there are four regional groups in the GSP rules, and GSP countries belonging to 
the SAARC and ASEAN region may also use diagonal cumulation upon request.41 
3.29.  Under the cumulation rules, a GSP beneficiary country may also use materials falling within 
HS chapters 25-97 which originated in Norway, Switzerland, Liechtenstein, and Turkey once that 
country fulfils certain conditions. Additionally, GSP beneficiary countries may apply to the 
Commission for cumulation extension to countries that have free trade agreements with the EU. At end-March 2015, no application was submitted to the Commission from GSP beneficiaries for 
extended cumulation with the EU's FTA partners. 
3.30.  Regarding the value-added criterion of GSP rules of origin, LDCs are allowed to have up to 
70% of non-originating materials in most industrial and processed agricultural exports; other GSP 
beneficiary countries may also have up to 70% for products from 28 HS chapters
42 and up to 50% 
for others. For most apparel products originating in LDCs, a single transforming requirement replaces the previous double transformation requirement.
43 
3.31.  In those trade arrangements where diagonal cumulation is provided for, it is not necessary 
that the processing carried out on the materials imported from other countries in the same 
cumulation system satisfies the list rules as long as the minimal operation requirements are satisfied. If the minimal operation requirements ar e not satisfied cumulation is still possible; the 
country of origin is determined in the case of GS P regional cumulation, by the highest share of the 
customs values of the materials originating in the countries of the regional group. 
3.32.  The working or processing considered insufficient to confer origin ("minimal operation") is 
defined in the relevant articles of the individu al preferential trade arrangements. In general, 
                                               
40 Currently there are two diagonal cumulation zo nes between the EU and its trading partners: one 
allowing for diagonal cumulation between the EU, the EFTA countries, the Faroe Islands, Turkey, and the 
Mediterranean countries; the other allowing for diagon al cumulation between the EU, Turkey, and the Western 
Balkans. 
41 See European Commission online information, “G eneralised Scheme of Preferences”. Viewed at: 
http://ec.europa.eu/taxation_customs/customs/customs_duties/rules_origin/preferential/article_781_en.htm  
[18/12/14]. Under regional cumulation, cases may occur that the input materials fro m other countries in the 
region are "graduated" or "excluded" from th e GSP, thus not eligible for preference. 
42 The rule of origin for all products of HS chapters 42, 45, 46, 47, 48, 49, 66, 89, 91, 92, 94, and most 
of products of HS chapters 25, 27, 34, 40, 43, 44, 68, 70, 71, 82, 83, 86, 88, 84, 85, 90, 95, 96 refers to 
threshold of 70% maximum non-originatin g materials for both LDC and non-LDCs. 
43 European Commission Regulation (EU) No. 1063/2010, 18 November 2010 (OJ L 307/1, 
23 November 2010). WT/TPR/S/317 • European Union 
 
- 41 - 
 
  operations are considered "simple" when neither special skills nor machines, apparatus or tools 
especially produced or installed for those operations, are required.44  
3.33.  In cases where no other rules prevail, non-originating products or materials that do not 
satisfy the sufficient operation requirements may be "tolerated". The "tolerance" level varies 
among preferential regimes. For GSP beneficiaries, 15% of the weight of the product or the 
ex-works price is the maximum "tolerance” level, if those materials were non-originating in the 
beneficiary country.45 
3.34.  In most free trade agreements, direct transport from beneficiary territories is still required 
for goods to maintain the preference. However, dire ct transport is no longer required under recent 
agreements, and for GSP origin goods, it is conditional on non-alteration. Storage of products and splitting of consignments may now be possible under the supervision of the customs authorities of 
the transit countries, hence, GSP benefits may be maintained in cases where goods are moved 
through regional distribution hubs.
46 
3.35.  Binding origin information (BOI) decisions may be issued by the customs authorities in the 
member States when importers are uncertain about the origin of products. BOIs are binding in all 
member States in respect of imported good s, provided the goods and the circumstances 
determining the acquisition of origin are identical in every respect to what is described in the BOI. 
BOIs are valid for three years after issuance. 
3.1.4  Tariffs 3.1.4.1  WTO bound tariffs 3.36.  All EU tariff lines are bound. Applied rates, in general, are at their bound rates (Table 3.1). 
The simple average bound tariff rate is 6.5%. 
3.37.  The current certified Schedule of Concessions is the EU-15.
47 The EU has circulated the 
EU-25 schedule in the WTO. 
3.1.4.2  MFN tariffs 
3.38.  The EU offers MFN or better treatment to WTO and non-WTO Members. The Commission 
indicated that no changes have been made in applied tariff rates since the last Review; changes in 
the average rates reflect only the changes of tariff codes, and the changes in world price of certain 
goods subject to non- ad valorem  rates. 
3.39.  Under the TFEU, common customs tariff duties  are set by the European Parliament and the 
Council, or the Council based on a proposal from the Commission.48 The tariff nomenclature, 
known as the Combined Nomenclature, is based on the Harmonized Commodity Description and 
Coding System (HS), but is further specified at an ei ght-digit level. In addition to publishing tariff 
information in the L-Series of the Official Journal  of the European Union49, the EU maintains a 
public online database that integrates tariff rates and other measures, including quantitative 
restrictions and contingency measures, applied to imports (and exports). According to the Commission, the database (TARIC) "secures the uniform application [of these measures] by all 
                                               
44 Operations such as preserving operations to ensu re that a product remains in good condition during 
transport and storage, breaking-up and assembly of pack ages, simple mixing of products, or simple assembly 
of parts are considered to be minimal operations (“simple”). 
45 15% of the product weight for products of HS chapters 2, and 4-24 other than processed fishery 
products of chapter 16, 15% of the ex-work  price for products under other HS chapters, and products under 
HS chapters 50-63 are subject to specific tolerance rules. 
46 European Commission Regulation (EU) No . 1063/2010, entered into force 1 January 2011. 
47 WTO document WT/Let/868, 30 October 2012. 
48 Article 31, TFEU. 
49 The latest version is contained in Commissi on Implementing Regulation (EU) No. 1101/2014, 
16 October 2014 (OJ L 312, 31 October 2014). WT/TPR/S/317 • European Union 
 
- 42 - 
 
  member States and gives all economic operators a clear view of all measures to be undertaken 
when importing or exporting goods."50 
3.40.  The 2014 tariff schedule is coded on the HS 2012 basis51, comprising 9,379 lines at the 
eight-digit level: around one-quarter of all tariff lines are duty free; approximately 7% of lines are 
"nuisance" rates, and tariff quotas cover around 5%  of tariff lines (Table 3.1). The simple average 
applied MFN tariff rate, including the ad valorem  equivalents (AVEs) of non- ad valorem  tariff rates, 
was 6.4%. Based on the relevant WTO definition, the average applied rate for agriculture fell to 
14.4% from 15.2% in 2011 and 17.8% in 2008. This reflects increases in prices of agricultural 
products and the resulting reduction in the AVEs of non- ad valorem  tariff rates applied on such 
products. The average applied rate for non-agricultural products was 4.3%. 
Table 3.1 Structure of MFN tariffs  in the EU-28, 2011, 2013 and 2014  
(%) 
 MFN applied Final 
Bound 
 2011a 2013b 2014c, d (2014) 
Bound tariff lines (% of all tariff lines) 100.0 100.0 100.0 100.0 
Simple average tariff rate 6.4 6.5 6.4 6.5 
Agricultural products (WTO definition) 15.2 14.8 14.4 14.6 
Non-agricultural products (WTO definition) 4.1 4.4 4.3 4.4 
Agriculture, hunting, forestry and fishing (ISIC 1) 8.7 8.6 7.7 8.5 
Mining and quarrying (ISIC 2) 0.2 0.2 0.2 0.3 
Manufacturing (ISIC 3) 6.3 6.4 6.4 6.5 
Duty free tariff lines (% of all tariff lines) 25.0 24.7 25.1 23.9 
Simple average rate of dutiable lines only 8.5 8.7 8.6 8.6 
WTO tariff quotas (% of all tariff lines) 4.9 5.0 5.0 5.0 
Non-ad valorem  tariffs (% of all tariff lines) 10.5 10.7 10.6 10.7 
Non-ad valorem  tariffs with no AVEs (% of all tariff lines) 2.9 2.9 3.1 3.1 
Domestic tariff peaks (% of all tariff lines)e 5.7 5.8 5.6 5.6 
International tariff peaks (% of all tariff lines)f 8.7 9.1 8.5 8.8 
Overall standard deviation of applied rates 10.3 10.3 12.0 12.1 
Nuisance applied rates (% of all tariff lines)g 8.8 7.0 6.9 7.1 
Number of lines 9,294 9,376 9,379 9,379 
Ad valorem 8,319 8,370 8,382 8,372 
  Duty free lines 2,319 2,312 2,356 2,244 
Non-ad valorem  975 1,006 997 1,007 
  Specific 553 576 651 661 
  Compound 193 201 199 201 
  Alternate 59 59 64 62 
  Otherh 170 170 83 83 
a Ad valorem  equivalents (AVEs) were estimated based on 2010 import data at the eight-digit tariff from 
Eurostat database. In case of unavailability, the ad valorem  part is used for compound and alternate rates. 
b Ad valorem  equivalents (AVEs) were estimated based on 2012 import data at the eight-digit tariff from 
Eurostat database. In case of unavailability, the ad valorem  part is used for compound and alternate rates. 
c Ad valorem  equivalents (AVEs) were estimated based on 2013 import data at the eight-digit tariff from 
Eurostat database. In case of unavailability, the ad valorem  part is used for compound and alternate rates. 
d Suffixes are not incorporated in a new tariff submissi on format to WTO Secretaria t (IDB unit) as of 2014: 
(1) duty rates of 1st January are taken for tariff lines related to seasonal rates; and (2) the highest tariff 
has been given for tariff lines depending on characteristics of the product. 
e Domestic tariff peaks are defined as those exceeding three times the overall simple average applied rate. f International tariff peaks are defined as those exceeding 15%. g Nuisance rates are those greater than zero, but less than or equal to 2%. h Other includes Agricultural Components (EA), Additional Duties For Sugar (AD S/Z), Additional Duties For 
Flour (AD F/M) and Entry Prices (EP). 
Note: All tariff calculations exclude in-quota lines. Year 2011 tariff schedules is based on HS2007 nomenclature 
and Years 2013 and 2014 schedules are based on HS2012. 
Source: WTO Secretariat. 
                                               
50 European Commission online information, "Onlin e customs tariff database (TARIC)". Viewed at: 
http://ec.europa.eu/taxation_customs/customs/customs_duties/tariff_aspects/customs_tariff/index_en.htm . 
51 European Commission Explanator y notes to the Combined Nomenc lature of the European Union 
(2011/C 137/01), 6 May 2011. Viewed at: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2011:137:FULL:EN:PDF  WT/TPR/S/317 • European Union 
 
- 43 - 
 
  Table 3.2 Summary statistics of MFN tariffs, 2014  
 Number 
of lines  Simple 
average 
(%) Tariff 
range 
(%) Standard 
deviation  Share of 
duty free 
lines 
(%) Share of 
non- ad 
valorem  
tariffs 
(%) 
Total 9,379 6.4 0-635.4 12.0 25.1 10.6 
HS 01-24 2,444 14.4 0-635.4 21.5 15.3 38.4 
HS 25-97 6,935 3.8 0-39 3.7 28.6 0.8 
By WTO category       
WTO agricultural products 2,069 14.4 0-635.4 23.5 19.2 46.5 
Animals and products thereof 351 20.2 0-288.9a 28.5 15.1 68.7 
Dairy products 152 36.1 1-635.4b 59.6 0 98.7 
Fruit, vegetables, and plants 503 13.1 0-183.5 14.2 11.9 17.1 
Coffee, tea, and cocoa and cocoa 
preparations 47 12.5 0-65.2 10.3 14.9 51.1 
Cereals and preparations 230 15.7 0-75.8 12.0 8.7 80.0 
Oils seeds, fats, oil and their products 174 6.4 0-117.1 12.7 35.6 6.9 
Sugars and confectionary 44 25.7 0-119.7 29.9 4.5 88.6 
Beverages, spirits and tobacco 303 13.6 0-116.2 17.8 18.2 55.8 
Cotton 6 0 0 0 100.0 0 
Other agricultural products, n.e.s. 259 5.2 0-85.8 10.3 51.0 22.0 
WTO non-agricultural products 7,310 4.3 0-26 4.4 26.8 0.5 
Fish and fishery products 494 12.0 0-26 6.4 8.1 0 
Minerals and metals 1,442 2.0 0-12 2.5 50.8 0.7 
Chemicals and photographic supplies 1,230 4.4 0-17.3 2.7 24.9 0.3 
Wood, pulp, paper and furniture 438 1.2 0-10.5 2.3 73.5 0 
Textiles 850 6.6 0-12 2.4 1.9 0.1 
Clothing 341 11.6 6.3-12 1.3 0 0 
Leather, rubber, footwear and travel 
goods 264 5.0 0-17 4.7 21.6 0 
Non-electric machinery 882 1.9 0-9.7 1.4 20.9 0 
Electric machinery 447 3.1 0-14 3.1 21.7 0 
Transport equipment 253 5.0 0-22 5.0 11.9 0 
Non-agricultural products, n.e.s. 620 2.6 0-14 2.0 25.2 3.2 
Petroleum 49 2.5 0-4.7 2.0 38.8 0 
a The tariff peak is calculated on a tariff line for which imports in 2013 were 2 tonnes. The next tariff 
peak in the same sector is 143.2%. 
b The tariff peak is calculated on a tariff line for which imports in 2013 were 22 tonnes. The next tariff 
peak in the same sector is 93.5%. 
Note: Calculations for averages are based on the nati onal tariff line level (8-digit), excluding in-quota 
rates. Tariff schedule is based on HS2012. Ad valorem  equivalents (AVEs) were estimated based on 
2013 import data at the 8-digit tariff from Eurostat database. In case of unavailability, the ad valorem  part is used for compo und and alternate rates.  
Source: WTO Secretariat calculations, based on IDB database and Eurostat database. 
3.41.  Around 11% of tariff lines are non- ad valorem , mostly on agricultural products (Table 3.1 
and section 4.2). Agricultural imports continue to face complex tariff structures such as entry price 
systems and the "Meursing Table". On average, non- ad valorem  rates continue to provide higher 
protection than ad valorem rates. All rates above 100% are AVEs relating to agricultural goods, 
applying to, inter alia , whey and modified whey (635%), pr epared or preserved poultry (288.9% 
and 143.2%), prepared or preserved mushrooms (183.5% and 159.5%), live poultry (156.4%), 
isoglucose (119.7%), and grape juice (116.2%) (Table 3.2). Apart from agricultural products, non-
ad valorem  tariff rates apply on 35 tariff lines, including mostly glass and watches, watch and 
clock movements, and watch cases. WT/TPR/S/317 • European Union 
 
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  3.42.  The highest rates for non-agricultural products apply on motor vehicles (22%) and on fish 
(26%), which are the same as in the previous Review. Tariffs on these goods are ad valorem  
rates, offering certainty to traders. 
3.43.  The Secretariat used average unit values to estimate the AVE of non- ad valorem  tariff rates. 
The data used to calculate import unit values are from Eurostat for 2013. The analysis excludes 
294 lines for which AVEs could not be estimated.52 In the context of this Review, the Commission 
expressed reservations about the Secretariat's methodology for estimating AVEs.53 
3.1.4.3  Tariff suspensions and tariff rate quotas 
3.44.  The Commission note that tariff suspensions may be granted for products unavailable within 
the EU, whereas tariff quotas for goods produced  in insufficient quantities within the EU.54 These 
measures permit the total or partial waiver of duties applicable to imported goods for an unlimited 
quantity (tariff suspension) or a limited quantity (tariff quotas). No tariff suspensions or quotas are 
granted for finished products.55 
3.45.  According to the Commission, tariff suspensi ons and tariff quotas allow enterprises to obtain 
supplies at a lower cost for a certain period, thus stimulating economic activity and improving 
competition in the EU. 
3.46.  Any business located in the EU may apply for a tariff suspension/quota through the 
designated national authorities to the Commission. The requests are examined by the Commission 
with the aid of the Economic Tariff Questions Grou p representing the competent authorities of each 
member State. The Council may approve tariff susp ensions and quotas on the basis of proposals 
from the Commission. According to one study, th e tariff suspension scheme operated in the EU 
serves its objective of allowing EU enterp rises to obtain supplies at a lower cost.56 
3.47.  According to the Commission, as a general rule, autonomous tariff suspensions are opened 
for a period of five years, and are automatically prolonged if they are sufficiently used.57 The 
Commission noted that an early termination of these measures is possible if economic 
circumstances change or interested parties request that they be deleted. Lists of products under 
tariff suspension/quota are amended twice a year. Currently there are around 1,800 tariff 
suspensions and 140 tariff quotas in force.58 Products covered include fishery products, basic 
chemicals, components for the microelectronics industry, and components for heavy and industrial machinery. 
                                               
52 AVEs were not estimated for those lines with no im ports or no entry prices; regarding compound or 
alternate tariffs, only the ad valorem  component was used for the analysis. 
53 The Commission indicates that any calculation of AVEs has shortcomings that can lead to distortions 
in the characterization of the actual level of tariff protection. The Commission notes that it is therefore 
important to treat results of AVE calculations with great caution, bearing in mind that the result can be influenced by several elements, including: the base pe riod and partners chosen; commodity prices; exchange 
rates; shocks in specific markets; treatment of mixed tariffs and tariff lines for which trade data are not 
available; and the extent to which preferential tr ade is included in the unit value calculation. 
54 See European Commission communication concer ning autonomous tariff suspensions and quotas 
2011/C 363/02), (OJ C 363/6, 13 December 2011). 
55 Some of the parts and components that are highly  technical, sophisticated and used without major 
modification could be considered as "finished" products ; however, tariff suspensions could be granted for those 
"finished" products as components in the final products, provided the added value of such an assembly operation is sufficiently hi gh. Paragraph 2.5.3, European Commissi on Communication on autonomous tariff 
suspensions and quotas (2011/C 363/02), (OJ C 363, 13 December 2011). 
56 European Commission (2013), Evaluation of the Scheme for th e Autonomous Suspension of CCT 
Duties , Final Report, 5 December 2013. Viewed at: 
http://ec.europa.eu/taxation_customs/resources/documents/common/publications/studies/evaluation_suspensi
ons_duties.pdf .  
57 In exceptional cases where a continuation of a tariff suspension implies the lasting need in external 
supplies or it is too costly to invest in domestic supplies, the Commission may propose an amendment to the 
Common Customs Tariff. Paragraph 2.3.2, European Commission Communication 2011/C 363/02, 13 December 2011. 
58 Council Regulation (EU) No. 1387/2013, 17 December 2013 (OJ L 354/201, 28 December 2013); 
Council Regulation (EU) No. 1388/2013, 17 December 2013 (OJ L 354/319, 28 December 2013); and Council Regulation (EU) No. 1220/2012, 3 December 2012 (OJ L 349/4, 19 December 2012). WT/TPR/S/317 • European Union 
 
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  3.48.  Most MFN tariff quotas are allocated on a "first-come, first-served" basis. When the quotas 
of the application period for the products in question are used up, normal import duties will be applied. Tariff Rate Quotas are managed centrally by the Commission, and can be consulted on an internet database which is updated every working day.
59 
3.49.  The EU grants preferential tariff quotas in accordance with the unilateral or reciprocal trade 
agreements (Table A3.1). It also operates a number of quotas for agricultural goods (section 4.2). 
3.50.  The EU has been communicating its TRQs information to the Integrated Data Base (IDB) of 
the WTO since 2014. 
3.1.5  Internal taxes collected at the border on imports 3.51.  Value added tax (VAT) and excise duties ar e two of the internal taxes collected at the EU 
border (section 3.3.3). The Commission indicated that no taxes other than VAT and excise duties 
are payable at the EU external border. 
3.52.  VAT is applied to both domestic and impo rted goods and services. For imported goods, VAT 
is assessed on the customs value plus duties, other charges, and incidental expenses. VAT on 
imports, in general, must be paid at the time of customs clearance. Imported goods are in free 
circulation once the applicable duties have been paid and the customs' formalities complied with. However, traders need to cope with different import VAT rules depending on the member State of 
importation rather than on the point of entry (section 3.3.3). 
3.53.  Domestic and imported alcoholic beverages
60, manufactured tobacco products, energy 
products (e.g. petrol, gas oil, natural gas) and el ectricity are subject to excise. Excise duty on 
imports is usually collected at the EU border unl ess the goods are placed under an excise duty 
suspension arrangement, which allows payment to be deferred. Excise duties are specific taxes. 
The classification and the rules for the holding and movement of untaxed excise goods are harmonized. The rates applied on these products vary across member States, but must be at least 
equal to the minimum rates established in the EU legislation. 
3.1.6  Import controls and restrictions 3.54.  The EU import licensing system is based on the premise that no import licences are required 
except where specific products from certain origins are subject to quantitative restrictions (for a 
list of those products see next paragraph) and for safeguard measures against injurious imports pursuant to either GATT Article XIX or internatio nal commitments. A prior surveillance system is 
maintained on the basis of Council Regulation No. 260/2009
61 but, in 2013 and 2014 no products 
have been subjected to it . The Commission applies this surveill ance system with the purpose of 
"improving transparency of import trends of the pr oducts concerned, but with no limits on access 
to the EU market".62 On this basis, statistical controls and further controls on the origin of the 
products may be performed. 
3.55.  The EU does not maintain quantitative restrictions on imports from WTO Members and 
countries with which the EU has bilateral agreements. Import quotas are applied to certain steel 
products from Kazakhstan, and certain textiles from Belarus and the Democratic People's Republic 
of Korea. 
3.56.  Most of the import licensing schemes, nota bly those linked to quotas, concern agricultural 
products (section 4.2). 
                                               
59 European Commission online information, "Tariff quota consultation". Viewed at: 
http://ec.europa.eu/taxation_customs/dds2/taric/quota_consultation.jsp?Lang=en .  
60 The general principle is that excise duty is only  due on alcohol intended for human consumption as a 
beverage. 
61 Council Regulation (EC) 260/2009 of 26 February 2009 on the Common Rules for Imports (codified 
version), OJ L 84; 31.03.2009. Viewed at: http://trade.ec.europa.eu/doclib/ docs/2009/april/tradoc_142728. 
Reg-260.en.L84-2009.pdf . 
62 Source: WTO notification G/LIC/N/3/EU/3 dated 6 November 2014. WT/TPR/S/317 • European Union 
 
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  3.57.  The EU also maintains import restrictions  on security and environmental grounds. Some 
such controls/restrictions stem from treaties and international conventions to which it, and/or its member States, are a party. That is the case of the Vienna Convention for the Protection of the Ozone Layer and the Montreal Protocol on Substanc es that Deplete the Ozone Layer. In principle, 
imports (and exports) of such Ozone Depleting substances (ODS) are prohibited but there are 
exemptions to that prohibition, and those exempt ions are subject to an import licensing scheme.
63 
Licences are issued by the European Commission. The Regulation prohibits the import of ODS and 
of products and equipment containing or relying on ODS from any country not party to the 
Montreal Protocol. In addition, some territories of member States of the EU are excluded from ratification of the Montreal Protocol or its amen dments and therefore trade with these territories 
may be limited or prohibited. Imports for the following uses are subject to quotas: essential 
laboratory and analytical uses; halons for critical uses; feedstock uses; and process agent uses. 
The allocation mechanism is based on grand fathering and a pro rata  repartition of a set-aside 
portion among new entrants.
64 
3.58.  Another case of import restrictions based on environmental grounds is the controls and 
restrictions stemming from the Convention on International Trade in Endangered Species of Wild Fauna and Flora. The EU has entered into bilateral "Forest Law Enforcement Governance and Trade 
Voluntary Partnership Agreements" with a number of countries, through which imports of specific 
timber and timber products from such countri es will be subject to a licensing scheme. 
3.59.  The measures taken in application of the Kimberley Process Certification Scheme on Rough 
Diamonds is another example of a licensing scheme stemming from international obligations. The 
EU as a whole is a single participant in the Kimberley Process Certification Scheme. The Kimberley 
Process establishes minimum requirements for an international scheme of certification for rough diamonds with a view to breaking the link between armed conflict and the trade in rough 
diamonds. Import licences are granted by designat ed "Union Authorities" (there are six such 
authorities located in Antwerp, Belgium; London, U.K.; Idar-Oberstein, Germany; Prague, the Czech Republic; Bucharest, Romania; and Sofia, Bulgaria). The licences are granted, provided 
that
65: the rough diamonds are accompanied by a cert ificate validated by the competent authority 
of a participant (i.e. of the Kimberley Process), the rough diamonds are contained in tamper-resistant containers, and the seals applied at export by that participant are not broken, the certificate clearly identifies the consignment to which it refers. 
3.1.7  Contingency measures 
3.1.7.1  Overview 3.60.  Contingency measures, or trade defence measures in EU parlance
66, are part of the 
Common Commercial Policy (CCP) under the exclusiv e competence of the EU. During the period 
under review, the institutional and legislative framework for contingency measures in the EU 
remained largely unchanged. 
3.61.  Legislation on contingency measures includes Regulation No. 1225/2009 on anti-dumping 
(known as "Basic Anti-dumping Regulation"), Re gulation No. 597/2009 on countervailing measures 
(known as "Anti-subsidy Regulation"), and Regulations No. 260/2009 and No. 625/2009 on safeguards. Regulation No. 427/2003 on transitional product-specific safeguards for imports from 
China expired in December 2013.
67 Currently, the EU is in the process of modernizing its trade 
defence instruments (anti-dumping and countervailing only) with the objective of improving 
                                               
63 Regulation (EC) No. 1005/2009 of the European Parliament and of the Council of 16 September 2009 
on substances that deplete the ozone layer (OJ L 286, 31.10.2009); for a list of the products subject to the scheme and a detailed description of the licensing regime see WTO document G/LIC/N/3/EU/3 dated 6 
November 2014 pp. 24-30. 
64 Commission Regulation No. 537/2011 of 1st June 20011 OJ L147/4 of 2 June 2011. 
65 The detailed procedures and requirements of this scheme are set up in Council Regulation (EC) 
No. 2368/2002 of 20 December 2002 implementing the Kimberley Process certification scheme for the international trade in rough diamonds (O.J. L 358, 31.12.2002, p. 28). 
66 See European Commission online information. Viewed at: http://ec.europa.eu/trade/policy/accessing-
markets/trade-defence/  [18/12/14]. 
67 Council Regulation (EC) No. 427/2003, 3 March 2003 (OJ L 65, 8 March 2003). WT/TPR/S/317 • European Union 
 
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  transparency in investigations and, in particular, regarding analogue country, injury margin, expiry 
reviews and the EU's interest.68 
3.62.  According to the Commission, around 0.3% of the total volume of imports into the EU was 
subject to contingency measures in 2013. During the last five years, the chemical, and iron and 
steel industries were the sectors most affected by contingency measures adopted in the EU 
(Table A3.2). 
3.1.7.2  Anti-dumping and countervailing 
3.63.  At end November 2014, the EU had 108 anti-dumping (AD) and 14 countervailing (CV) 
measures in force, affecting 27 trading partners. These measures include new measures, extended measures, and measures imposed from circumventio ns. Some AD measures have been in place for 
longer than ten years. The Commission maintains public websites to provide information on 
investigations
69, and on notices and adopted measures.70 
3.64.  An industry within the EU may lodge a complaint with the Commission which may then 
initiate an investigation.71 If the investigation determines there is dumping or subsidies in 
production and/or export of the products concer ned, causality between the imports and injury, or 
threat thereof to the EU's industry, and that the imposition of a contingency measure is not against EU interests, the Commission may ad opt contingency measures. The adoption of 
contingency measures is subject to the new "comitology" rules (section 2.1) and requires 
consultations of a committee compos ed of member State representatives; member States can only 
oppose measures with a qualified majority. 
3.65.  Provisional measures may be imposed no earlier than 60 days from the initiation of the 
proceeding. The provisional duties apply the "lesse r duty" principle, i.e. the amount of the duty 
should be the lesser of the dumping margin and the level determined necessary to "remove the 
injury". 
3.66.  Provisional duties must be secured by a guarantee. Upon provis ion of the guarantee, 
imports of the product concerned will be released for free circulation in the EU. Provisional duties may be imposed for six months, up to a maximum of nine months. 
3.67.  Definitive anti-dumping or countervailing me asures are usually imposed for a fixed period of 
five years, subject to expiry re views and, if no expiry review is requested, the measure expires 
automatically. Expiry reviews may be initiated at the request of an EU industry or on the 
Commission's initiative. If the expiry review determines the measure should be retained, the 
duties normally remain in force for another five years.
72 The Commission indicated that the 
average duration of AD measures in the EU is around six years (for the period 2002-mid-2014). 
3.68.  AD or CV measures may be terminated before their expiry. After the measures have been 
imposed for longer than one year, an interim revi ew may be requested by an exporter, importer, 
or by EU producers.73 Anti-dumping measures against certain trading partners may be terminated 
in an expiry review or an interim review while being retained for others. The threshold for 
                                               
68 European Commission document MEMO/13/319, 10 April 2013. Viewed at: 
http://europa.eu/rapid/press-release_MEMO-13-319_en.htm . 
69 European Commission online information, "T rade Defence: Investigation". Viewed at: 
http://trade.ec.europa.eu/tdi/index.cfm . 
70 European Commission online information, "T rade Defence: Notice board". Viewed at: 
http://trade.ec.europa.eu/tdi/notices.cfm . 
71 An EU industry is referred to EU producers as a wh ole of the like products or to those whose collective 
output of the products constitutes a major proportion of EU production. In this context, a major proportion is 
defined as being at least 25% of total EU production of the like product. 
72 An expiry review can result in ei ther the repeal or continuation of the duties in force, but not in a 
change in the level or form of the duties. Changes in the level or form of the contingency measures can be 
carried out through interim reviews. 
73 Interim reviews may also be carried out on the in itiative of the Commission or at the request of 
member States. See Article 11.3 of the Basic Anti-dumping Regulation. WT/TPR/S/317 • European Union 
 
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  terminating AD measures is where the dumping margin is determined to be less than 2% of the 
export price.74 
3.69.  During the period under review, the EU initiated 16 new AD investigations, around half the 
number of the last review period (Table 3.3). The Commission noted that during the period 2009-
13, around 53% of investigation case s turned into definitive measures. 
Table 3.3 Anti-dumping investigatio ns and measures imposed, 2010-14 
2010 2011 2012 2013 2014
Investigation initiations 15 17 13 6 10 
Provisional measures 9 10 8 5 1 
Definitive measures 6 11 3 12 1 
Expired measuresa 14 18 14 6 2 
Confirmation of measure following expiry review 10 8 12 5 4 
Termination of measure following expiry/interim review 3 3 6 8 2 
a Measures that expired automatically after their five-year imposition, not including the extended 
measures that automatically expired after the extension. 
Note: As at end November 2014. Source: WTO Secretariat; and European Comm ission online information. Viewed at: 
http://trade.ec.europa.eu/tdi/notices.cfm . 
3.70.  A total of 12 new definitive AD measures were adopted in 2013, affecting 8 trading 
partners. The majority of AD measures in force in recent years were on imports from Asia, in 
particular China. Over the past five years, Asia accounted for 79% of the AD measures imposed, with other European countries outside the EU accounting for 14% (Chart 3.1). 
Chart 3.1 Anti-dumping measures in force, by region, 2010-14 
Number of measures (cumulated) 
5 5 4 4 37 6 6 6 5105103
9499
912222
1716
1321
1
020406080100120140160
2010 2011 2012 2013 2014Africa Americas Asia Europe Middle Easta
 
a Non-EU European countries includ ing Armenia, Belarus, Russian Fede ration, Kazakhstan, Republic of 
Moldova, and Ukraine. 
Note: As at end November 2014. 
 Source: WTO Secretariat, based on informat ion provided by the European Commission. 
3.71.  In terms of sectors affected by AD measur es imposed over the last five years, chemicals, 
and iron and steel accounted for most measures. Products subject to AD measures include 
biofuels, steel ropes and cables, oxalic acid, and tu be and pipe fittings. Two measures on biodiesel 
                                               
74 Article 9(3), Council Regulation (EC) No. 1225/2009, 30 November 2009 (OJ L 343/51, 
22 December 2009). WT/TPR/S/317 • European Union 
 
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  that were imposed in November 2013 were subject to dispute settlement proceedings in the WTO 
(Table A2.2). 
Chart 3.2 Anti-dumping measures in force, by product, 2010-14 
3 351 49
3831243532
31
36
3415
15
1515
131
1
12
215
14
15 15
156
3
2 2
11
2
2 2
214
18
18 22
21
020406080100120140160
2010 2011 2012 2013 2014Footwear Chemical and allied Iron and Steel
Other metals Electronics Other mechanical engineering
Textiles and allied Wood and paper OtherNumber of measures (cumulated)
 
Note: As at end-November 2014. 
 Source: WTO Secretariat, based on informat ion provided by the European Commission.  
3.72.  Some of the highest definitive AD duties that resulted from original investigations or reviews 
between July 2012 and June 2014 concern, inter alia , certain iron and steel fasteners from China 
(74.1%), molybdenum wires (64.3%), certain tungsten electrodes from China (63.5%), certain 
open-mesh fabrics of glass fibres from Chinese Taipei, India and Indonesia (62.9%), solar panels 
from China (64.9%), and peroxosulphates from China (71.8%).75 
3.73.  Initiations of countervailing investigations remained at broadly similar levels since the 
previous review (Table 3.4). During 2013-14, four new definitive measures were imposed from the 
cases initiated in the previous year (Table A3.2). 
Table 3.4 Countervailing investigations  and measures im posed, 2010-14 
2010 2011 2012 2013 2014
Investigation initiations 3 4 6 5 2 
Provisional measures 4 0 1 1 1 
Definitive measures 3 2 0 3 1 
Expired measuresa 0 3 0 0 0 
Confirmation of measure following expiry review 1 0 0 1 0 
Termination of measure following expiry review 0 1 0 2 0 
a Measures that expired automatically after their five-year imposition, not including the extended 
measures that automatically expired after the extension. 
Note: As at end November 2014. 
Source: WTO Secretariat; and European Comm ission online information. Viewed at: 
http://trade.ec.europa.eu/tdi/notices.cfm . 
                                               
75 Only AD duties in the form of ad valorem  duties were considered. See WTO documents 
G/ADP/N/237/EU, 8 April 2013; G/ADP/N/244/EU, 20 September 2013; G/ADP/N/252/EU, 14 March 2014; and G/ADP/N/259/EU, 5 September 2014. WT/TPR/S/317 • European Union 
 
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  3.74.  Newly-opened investigations in 2013 covered solar glass, glass fibre products panels, and 
polyester staple fibres (PSF). There are 16 countervailing measures in force, three of which have lasted longer than ten years through various extensions, concerning Indian-origin products of polyethylene terephthalate (PET), sulphalinic acid , and graphite electrode systems (Table A3.2). 
3.75.  The EU may not impose AD or CV measur es on imports from Iceland, Liechtenstein or 
Norway, except for fish and other goods that are outside the free movement of goods scope of the European Economic Area. 
3.1.7.3  Safeguards 
3.76.  The legislative framework for safeguard measures remained largely unchanged during the 
period under review. No safeguard measures have been applied since 2005. 
3.77.  The Commission is in charge of conducting safeguard investigations in cooperation with 
member States. The adoption of definitive safeguard measures is not subject to the standard 
regime under the new "comitology" rules; the adoption of definitive safeguard measures requires a positive opinion voted by qualified majority of a committee composed of member State 
representatives, as opposed to general "comitology" rules which require a qualified majority to 
reverse a Commission proposal to adopt AD/CV measures.  
3.78.  Under the relevant safeguard legislation, th e Commission may decide to impose surveillance 
if the "trend in imports of a product originating in a third country threatens to cause injury to EU 
producers". During the period under review, no  surveillance measures were applied to WTO 
Members. Simple surveillance is applied to textile imports from Belarus and DPR Korea on the basis of Regulation No. 517/94.
76 
3.79.  Provisions including related implementing regulations on safeguards are also contained in 
recent applied/concluded free trade agreements (FTAs), as well as in the Generalised Scheme of Preferences (GSP). The Commission indicated that safeguards measures in accordance with 
provisions in FTAs or GSP have not applied to any cases. 
3.1.8  Technical regulations and standards 3.80.  As was noted in the last Review, a considerable amount of legislation on technical 
requirements and conformity assessment is harmon ized at the EU level with the objective of 
ensuring the free movement of goods while maintaining a high level of health and safety, and protection of consumers and the environment within the Union.
77 The EU system of technical 
regulations, standards and conformity assessment is outlined in the Blue Guide on the 
implementation of EU product rules which was first published in 2000 and most recently in 2014.78 
3.81.  Since 1985, the EU approach to technical regulations and standards has been to set out in 
legislation the essential requirements for a particular product. Harmonized standards are then 
developed as a means to meet these essential requirements. Compliance with the relevant 
harmonized standard is voluntary but provides a presumption of conformity with the essential requirements. A product which does not comply with the relevant harmonized standards, but 
meets the essential requirements may be marketed in Europe.
79 In the majority of such cases, the 
producer may use the same conformity assessment procedures as would be used to show the product is manufactured in compliance with harmon ized standards. However, for toys, high-risk 
machinery, and specific issues related to the use of radio frequencies, third-party conformity 
assessment is required if the product is not manufactured in compliance with harmonized 
standards (see below). In the absence of more specific safety legislation at EU level, consumer goods are subject to the safety requirements se t out in the General Product Safety Directive. 
These goods include, inter alia , childcare products, textiles, and several other consumer goods.  
                                               
76 Council Regulation (EC) No. 517/94, 7 March 1994 (OJ L 67/1, 10 March 1994).  
77 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, section 3.1.8. 
78 European Commission (2014), The 'Blue Guide' on the implementation of EU product rules 2014, Ref. 
Ares (2014) 1025242 – 02/04/2014. 
79 The postal service sector is the only services sector to which harmonised standards apply (see Table 
3.6). WT/TPR/S/317 • European Union 
 
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  3.82.  The principal legislation setting the basis for technical requirements, standards, conformity 
assessment, and accreditation in the EU are set out in Table 3.5. 
Table 3.5 Legal basis for technical requiremen ts, standards, conformity assessment, and 
accreditation in the EU at end-2014 
Legislation  
Regulation (EC) No. 765/2008 Lays down rules on the organization and operation of accreditation for 
conformity assessment bodies. The Re gulation provides a framework for 
market surveillance, a framework fo r controls on products from third 
countries, and lays down the gene ral principles for CE marking. 
Decision No. 768/2008/EC Sets out a common framework for the marketing of products. The 
Decision is a political commitment rather than applicable legislation, but 
it does require the European Parl iament, Council, and Commission to 
adhere to its principals when preparing legislation. 
Regulation (EC) No. 764/2008 Lays down the rules and procedures to be followed by the competent 
authorities of a member State for decisions which may hinder the free 
movement of a product lawfully mark eted in another member State. The 
Regulation also provides for the establishment of Product Contact Points in the member States. 
Regulation (EU) No. 1025/2012 Establishes rules for cooperation between European standardization 
organizations, national standardizat ion bodies, member States, and the 
Commission. It also sets out rules for the establishment of European 
standards and European standardizat ion deliverables for products and 
services, the identification of ICT technical specifications eligible for 
referencing, the financing of Europe an standardization, and stakeholder 
participation in European standardization. 
Directive 2001/95/EC Applies principally to products which are not covered by harmonization 
legislation and sets up the rapid alert system (RAPEX) between the member States and the Commission  and associated measures for 
products deemed to be dangerous. 
Source: European  Commission. 
3.83.  In addition to the basic rules in Table 3.5, there are Articles 34 to 36 of the TFEU 
(prohibiting quantitative restrictions and measures  with equivalent effect) and case law from the 
Court of Justice of the EU on mutual recognitio n of technical requirements and on the general 
principle of the free movement of goods.80 
3.84.  As noted in Table 3.5, the legal basis for the development of standards in the EU is 
Regulation (EU) No. 1025/2012 which outlines the pr ocedures to be followed in the development 
of standards and similar documents ("other deliverables") by the European standards 
organizations (ESOs) and national standardizat ion bodies. The three ESOs recognized in the 
Regulation are the European Committee for Standardization (CEN), the European Committee for Electrotechnical Standardization (Cenelec), and the European Telecommunications Standards 
Institute (ETSI). The Commission may make a formal request to the standardization organizations 
for development of a standard following consultation with interested parties, submission to the Committee on Standards, and subsequent approval by the member States (comitology procedures). 
3.85.  Regulation (EU) No. 1025/2012 also requires each national standardization body in the EU 
to make its work programme publicly available.  Draft standards developed by a member State's 
standardization body must be notified to the relevant ESOs that will then circulate the list of 
national initiatives to the national standardization bodies of the other member States. The national 
standardization bodies may not object to a subject for standardization in their work programme from being considered at the EU level in accordance with the rules laid down by the ESOs 
(including a standstill period). When a European  standard has been developed and adopted by the 
relevant ESO, any conflicting national standard must be withdrawn in order to ensure the overall coherence of the European standardization system. 
                                               
80 Most notably the Cassis de Dijon case (Jud gment of the European Court of Justice of 
20 February 1979 - Rewe-Zentral AG v Bundesmonopolverwaltung für Branntwein - Reference for a preliminary 
ruling: Hessisches Finanzgericht - Germany - Measures heav ing an effect equivalent to  quantitative restrictions 
- Case 120/78). WT/TPR/S/317 • European Union 
 
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  3.86.  The Commission maintains an online database of requests for standards81 and publishes an 
annual European standardization work programme.82 It also provides a list of national 
standardization bodies in the member States.83 
3.87.  Currently, harmonized standards apply to 11 different areas covering 31 product groups and 
one service area (Table 3.6 includes references to harmonized standards in the EU as at 
end-2014). 
3.88.  On 26 February 2014 an “Alignment Package” consisting of eight directives was adopted, 
and published in the Official Journal of the European Union on 29 March 2014.84 These directives 
cover low voltage electrical equipment, electromagnetic compatibility, equipment in potentially explosive atmospheres, lifts, simple pressure vessels, measuring instruments, non-automatic weighing instruments, and civil explosives and will become applicable in April 2016. In addition, in 
2013 and 2014, legislation was adopted in the areas of pyrotechnic articles, recreational craft, 
radio equipment, and pressure equipment. The Commission also noted that further proposals for alignments of standards are pending on medical devices, gas appliances, cableways and personal 
protective equipment. 
Table 3.6 Harmonized standards in the EU, December 2014 
 Subject Legal basis 
Chemicals 
 Chemical substances Regulation (EC) No. 1907/2006
 Explosives for civil use Council Directive 93/15/EEC, and Directive 2014/28/a 
 Pyrotechnic articles Directive 2007/23/EC, and Directive 2013/29/EUb 
Conformity assessment and managements systems
 New Legislative Framework (NLF) and Eco-Management 
and Audit Scheme (EMAs) Regulation (EC) No. 765/2008, Decision No. 768/2008/EC, and 
Regulation (EC) No. 1221/2009 
Construction 
 Construction products (CPD/CPR) Council Directive 89/106/EEC, and Regulation (EU) 
No. 305/2011 
Consumers and workers protection 
 Cosmetics products Regulation (EC) No. 1223/2009
 General product safety Directive 2001/95/EC
 Personal protective equipment (PPE) Council Directive 89/686/EEC
 Toys safety Directive 2009/48/EC
Energy efficiency 
 Ecodesign and energy labelling Directive 2009/125/EC, and Directive 2010/30/EU 
Electric and electronic engineering 
 Electromagnetic compatibility (EMC) Directive 2004/108/EC, and Directive 2014/30/EUa 
 Equipment for explosive atmospheres (ATEX) Directive 94/9/EC, and Directive 2014/34/EUa 
 Low Voltage Devices (LVD) Directive 2006/95/EC, and Directive 2014/35/EUa 
 Radio and Telecommunications Terminal Equipment 
(RTTE) Directive 1999/5/EC, and Directive 2014/53/EUc 
 Restriction on the use of certain hazardous substances 
(RoHS) in electrical and electronic equipment Directive 2011/65/EU
Healthcare engineering 
 Active implantable medical devices Directive 90/385/EEC
 In-vitro diagnostic medical devices Directive 98/79/EC
 Medical devices (MDD) Directive 93/42/EEC
Measuring technology 
 Measuring instruments (MID) Directive 2004/22/EC, and Directive 2014/32/EUa 
 Non-automatic weighing instruments (NAWI) Directive 2009/23/EC, and Directive 2014/31/EUa 
Mechanical engineering and means of transport
 Cableway installations designed to carry persons Directive 2000/9/EC
 Equipment for explosive atmospheres (ATEX) Directive 94/9/EC, and Directive 2014/34/EU 
 Gas appliances (GAD) Directive 2009/142/EC
 Inspection of pesticide application equipment Directive 2009/128/EC
 Lifts Directive 95/16/EC, and Directive 2014/33/EUa 
 Machinery (MD) Directive 2006/42/EC
                                               
81 See: http://ec.europa.eu/enterprise/standards_policy/mandates/database/  [December 2014]. 
82 European Commission (2014), Communication from the Commission to the European Parliament, the 
Council and the European Economic and Social Committ ee – The annual Union work programme for European 
standardisation for 2015, COM(2014) 500 final. This programme and programmes for earlier years are 
available from: http://ec.europa.eu/enterprise/policies/european-standards/standardisation-
policy/index_en.htm  [December 2014]. 
83 OJ 2013/C 279/08. 
84 OJ L 96 29 March 2014. WT/TPR/S/317 • European Union 
 
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   Subject Legal basis 
 Pressure equipment (PED) Directive 97/23/EC, and Directive 2014/68/EUd 
 Rail system: interoperability Directive 2008/57/EC
 Recreational craft Directive 94/25/EC, and Directive 2013/53/EUe 
 Simple pressure vessels (SPVD) Directive 2009/105/EC, and Directive 2014/29/EUa 
Services 
 Community postal services Directive 97/67/EC
Sustainability 
 Packaging and packaging waste Directive 94/62/EC
 
a To be applied from 20 April 2016. b To be applied from 1 July 2015. c To be applied from 13 June 2016. d To be applied from 1 June 2015 for classification of substances and 19 July 2016 for other  provisions. 
e To be applied from 18 January 2016. 
 Source: EU Commission online information. Viewed at: http://ec.europa.eu/enterp rise/policies/european-
standards/harmonised-standards/index_en.htm , and http://ec.europa.eu/enterprise/policies/single-
market-goods/internal-market-for-products /new-legislative-framework/index_en.htm  
[December 2014]. 
3.89.  In the absence of EU harmonized techni cal regulations, member States may develop and 
apply national technical regulations subject to the procedures set out below. Directive 98/34/EC requires member States to notify a draft technical regulation to the Commission and other 
member States. This procedure was originally set up in 1983 through Council Directive 
83/189/EEC. The Commission maintains an online database of these notifications which can be consulted by the public.
85 Following notification, there is a three-month standstill period during 
which the draft may not be adopted. This period may be extended by up to 6 months if a member 
State or the Commission issues a detailed opinion and up to 12 to 18 months if the Commission decides to block the draft technical regulation while harmonization work at the EU level continues. The Commission reports to the EU Parliament, the Council and the European Economic and Social 
Committee on the operation of Directive 98/34/EC. At end-2014, the most recent report was for 
the 2009-10 period.
86 
3.90.  Goods legally put on the market (i.e. either produced or imported) in one member State are 
subject to the principle of mutual recognition, which allows them to be marketed in another 
member State even if they do not conform to the second member State's technical regulations. The free movement of goods may be limited where a member State can show that refusal is 
"justified on grounds of public morality, public po licy or public security; the protection of health 
and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property
87" or by 
reason of one of the imperative requirements recognized by the Court of Justice of the EU 
(CJEU).88 H o w e v e r ,  a s  n o t e d  b y  t h e  C o m m i s s i o n ,  t h e  C J E U  r e q u i r e s  t h a t  s u c h  r u l e s  m u s t  b e  
necessary in order to attain the intended legitimate objectives, and be in conformity with the principles of proportionality, whereby the least-restrictive measure is to be used. 
3.91.  Regulation (EC) No. 764/2008 aims to en sure the correct application of the mutual 
recognition principle in individual cases. Pursua nt to the Regulation, member States that use 
existing technical regulations to restrict market access for products lawfully marketed in another 
Member State must justify their position with technical or scientific evidence, and must grant the 
economic operators affected an opportunity to provide comments. Furthermore, the Commission publishes "a non-exhaustive list of products which are not subject to Community harmonization legislation" as well as a list of the contact points in each Member State.
89 In 2014 the European 
                                               
85 See http://ec.europa.eu/ente rprise/tris/en/search/  [February 2015]. 
86 EU Commission (2011), Report from the Commission to the Eu ropean Parliament, the Council and the 
European Economic and Social Committee – The Op eration of Directive 98/34/EC in 2009 and 2010, 
COM(2011) 853 final, 7 December. Viewed at: http://ec.europa.eu/growth/tools-databases/tris/en/the-9834-
and-you/being-informed/reports/  [February 2015]. 
87 TFEU, Article 36. 
88 For examples of the requirements recognized by  the CJEU see Commission online information. 
Viewed at: http://ec.europa.eu/internal_market/capital/framework/treaty/index_en.htm  [February 2015]. 
89 The list can be consulted on European Commission online inform ation, "DG Enterprise: Mutual 
recognition". Viewed at: http://ec.europa.eu/enterprise/policies/single-market-goods/free-movement-non-
harmonised-sectors/mutual-recognition/index_en.htm  [December 2014]. WT/TPR/S/317 • European Union 
 
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  Commission received 258 notifications from member States on decisions which have the effect of 
non-application of mutual recognition, as established by the procedural rules of Regulation (EC) No. 764/2008.
90 The Commission also stated that it was preparing a report on the application of 
the principle of mutual recognition in goods which is expected to become available during 2015. 
3.92.  At the EU level, the requirements for accr editation of conformity assessment bodies are set 
out in Regulation (EC) No. 765/2008 on accr editation and market surveillance. Under the 
Regulation, each member State must appoint a single national accreditation body which cannot be 
involved in conformity assessment activities itself, cannot compete with other accreditation bodies, 
and must operate on a not-for-profit basis. A nati onal accreditation body must be a member of the 
European cooperation for Accreditation (EA) "whose main mission is to promote a transparent and quality-led system for the evaluation of the competence of conformity assessment bodies 
throughout Europe" and which "manages a peer evaluation system among national accreditation 
bodies from the member States and other European countries
91,92." The national authorities are 
required to recognize the equivalence of the serv ices delivered by other national accreditation 
bodies that have passed their peer review and acce pt the accreditation certificates issued by those 
bodies as well as the certificates or test reports issued by the conformity assessment bodies accredited by them.
93 
3.93.  Conformity assessment of a product covere d by EU harmonized legislation depends on the 
level of risk associated with it. Low-risk products require a manufacturer's or supplier's declaration of conformity, while high-risk products are subject to conformity assessment by the relevant notified conformity assessment bodies. These notified conformity assessment bodies are 
certification, inspection, and testing bodies designated by member States to perform specific 
conformity assessment activities mandated under EU product legislation.
94 The designation of 
notified bodies by member States involves a technical assessment of their competence and 
adequacy of their organization and procedures, ty pically based on accreditation, and a political 
decision whereby member States take responsibility for the operation and supervision of the notified body. Some products which are not specifically covered by EU harmonized legislation are 
subject to the General Product Safety Directive and are not subject to any specific conformity 
assessment process.
95 
3.94.  Under the Rapid Alert System for non-food dangerous products (RAPEX), the authorities of 
the EU member States and the EFTA countries exch ange information on products deemed to pose 
a risk to health and safety and measures taken to address these risks. Measures taken by 
producers and distributors are also reported (Table 3.7). 
3.95.  Between 1 January 2013 and 31 December 2014, the EU submitted 196 notifications under 
Article 10.6 (including revisions, addenda, and corrigenda) to the TBT Committee and individual 
member States submitted another 68.96 The EU also submitted one notification under Article 10.7 
on agreements with other WTO Members regard ing a Protocol to the Euro-Mediterranean 
Agreement on Conformity Assessm ent and Acceptance of Industrial Products with Israel.97 
3.96.  In 2013 and 2014, some WTO Members used the TBT Committee to raise specific trade 
concerns relating to notifications made by the EU or the member States. During these two years, 
                                               
90 The principle of mutual recognitio n is just one aspect of the applic ation of the rules on free movement 
of goods in the non-harmonized area established by the Treaty (Arts. 34 – 36 TFEU). Thus, there are no 
indicators per se  on infringements or cases before the Co urt on grounds of "mutual recognition". 
91 Whereas (23), Regulation No. 765/2008. 
92 EA members are the national accreditation bodies  of the member States and Iceland, Montenegro, 
Norway, Serbia, Switzerland, The former Yugoslav Repu blic of Macedonia, and Turkey. The associate members 
are the national accreditation bodies of Albania, Algeria, Belarus, Bosnia  and Herzegovina, Egypt, Georgia, 
Israel, Jordan, Kosovo, Morocco, Moldova, Tunisia, and Ukraine. 
93 Article 11, Regulation (EC) No. 765/2008. 
94 The designation of a conformity assessment body takes the form of  a notification from the member 
State concerned to the Commission and other member  States, hence the term "notified" conformity 
assessment body. 
95 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, paras 3.98, and 3.103. 
96 1 from Croatia, 18 from the Czech Republic, 5 from Denmark, 1 from Estonia, 1 from Finland, 18 from 
France, 1 from Germany, 3 from Hungary, 2 from Irel and, 1 from Latvia, 8 from Lithuania, 1 from the 
Netherlands, 7 from Sweden, and 1 from the United Kingdom. 
97 WTO document G/TBT/10.7/N/121 of 7 February 2013 and WT/TPR/S/284/Rev.2 of 28 November 
2013, para.3.102. WT/TPR/S/317 • European Union 
 
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  seven concerns were raised which had been raised previously98 and a further seven were raised for 
the first time.99 
Table 3.7 RAPEX reporting 2010-14 
 Consumer products Professional products 
 Serious risk Other risk For 
information Serious 
risk Other risk For 
information 
2010 1,963 38 243 7 6 7 
2011 1,556 58 189 17 2 6 
2012 1,938 104 236 31 2 4 
2013 1,981 89 294 27 2 0 
2014 2,038 112 159 29 1 2 
Source: RAPEX Annual Reports 2010-14. Viewed at: 
http://ec.europa.eu/consumers/consumers_safety /safety_products/rapex/reports/index_en.htm  
[March 2015]. 
3.97.  The EU has also used the TBT Committee to raise its own concerns with measures proposed 
or implemented by other Members, in particular in  areas of foodstuffs and beverages, cosmetics, 
medical devices, ICT and electrical equipment in dustries, tyres, and textiles. Some of these 
concerns had also been raised before 2013.100 
3.1.9  Sanitary and phytosanitary measures 
3.98.  To a large extent, legislation on SPS measures in the EU has been harmonized and the 
majority of measures are taken by the EU – alth ough member States can, and occasionally do, 
take specific measures in specific circumstances.101 The principal legislation on SPS measures is 
set out in Table 3.5. 
3.99.  There have been no major changes to the legislative framework for SPS measures since the 
last Review.102 However, on 6 May 2013 the Commission adopted a proposal for a package of 
measures which, according to the Commission, allows for simplification, modernization, increased 
consistency, and convergence with international standards of EU health and safety standards for the agri-food chain. The package of proposals was notified to the SPS Committee of the WTO on 17 May 2013 and, at the beginning of 2015, was going through the normal consultative and 
legislative process for regulations of the European Parliament and Council.
103 
                                               
98 Directive 2004/24/EC on Traditional Herbal Medi cinal Products (WTO TBT Information Management 
System ID 265); France – Loi No. 2010-788: The National  Commitment for the Environment (Grenelle 2 Law) 
(ID 306); Directive 2009/28/CE, Renewable Energy Directive (EU - RED) (ID 307); Issue with respect to honey containing pollen from genetically modified maize MON810, Ruling from ECJ (ID 322);  Directive 2011/62/EU of the European Parliament and of the Council amending Directive 2001/83/EC on the Community code relating to 
medicinal products for human use, as regards the prevention of the entry in to the legal supply chain of falsified 
medicinal products (ID 334); Draft Implementing Regula tions amending Regulation (EC) No. 607/2009 laying 
down detailed rules for the application of Council Regulation (EC) No 479/2008 as regards protected 
designations of origin and geographical indications, traditional terms, labelling and presentation of certain wine sector products (ID 345); and Draft Commission Regulation implementing Directive 2009/125/EC of the European Parliament and of the Council with regard to  ecodesign requirements for directional lamps, light 
emitting diode lamps and related equipment (ID 365). 
99 Tobacco products, nicotine-containing products and herbal products for smoking. Packaging for retail 
sale of any of the aforementioned products (ID 377); Ireland - Proposal to introduce standardized/plain 
packaging of tobacco products in Ireland (ID 380); Tran sformation of still wine into sparkling wine EC 
Regulation 479/2008 of 29 April 2008 (ID 381); Implementing Regulation (EU) No 481/2012 laying down rules for the management of a tariff quota for high-quality be ef (ID 382); Proposal for a Regulation on Fluorinated 
Greenhouse Gases (ID 391); Revised Proposal for the Categorization of Compounds as Endocrine Disruptors of 19 February 2013 by DG Environment (ID 393); and Italy - Testing requirement on import of steel cutlery products (ID395). 
100 WTO TBT Information Management System http://tbtims.wto.org/Default.aspx?Lang=0  
[February 2015]. 
101 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, section 3.1.9. 
102 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, paragraphs 3.110 to 3.127. 
103 Commission online information. Viewed at: 
http://ec.europa.eu/dgs/health_consumer/pressroom/animal-plant-health_en.htm  [January 2014] and WTO 
documents G/SPS/N/EU/43, 44, 45, 46 and Add.1 to each  document (on animal health, plant health, plant WT/TPR/S/317 • European Union 
 
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  Table 3.8 Principal SPS legislation in the EU in 2015 
Legislation Last 
amended  
Regulation (EC) No. 178/2002 2014 The General Food Law. 
Applies to safety of food and feed in the internal market, 
established a framework for controlling and monitoring the risks and their prevention and management, and created the European Food Safety Authority (EFSA) for the control and evaluation of food and feed.  
Regulation (EC) No. 852/2004 2009 On the hygiene of foodstuffs. 
General rules for food business operators on the hygiene 
of foodstuffs, putting primary responsibility on the 
operators, implementation of  procedures based on the 
HACCP principles and good hy giene practice, and ensuring 
imported foods are at least the same, or equivalent, 
hygiene standard as food produced in the EU 
 
Regulation (EC) No. 853/2004 2014 Supplementing Regulation (EC) No. 852/2004. Setting out 
specific rules on hygiene for food of animal origin for food business operators and applying to unprocessed and processed products of animal origin.  
Regulation (EC) No. 854/2004 2014 Setting out specific rules on the organization of official 
controls on products of anim al origin intended for human 
consumption. The Regulation applies in addition to 
Regulation (EC) No. 882/2004. 
 
Regulation (EC) No. 882/2004 2014 On official controls for verification of compliance with feed 
and food law, animal health , and animal welfare rules.  
The Regulations sets ou t general rules for the 
performance of official contro ls to verify compliance with 
rules aiming, in particular, at : (a) preventing, eliminating 
or reducing to acceptable levels risks to humans and animals, either directly or through the environment; and (b) guaranteeing fair practice s in feed and food trade and 
protecting consumer interest s, including feed and food 
labelling and other forms of consumer information.  
Directive 2002/99/EC 2013 Setting out rules for the production, processing, 
distribution, and introduction of products of animal origin 
for human consumption. The Directive lays down the 
general animal health rules governing all stages of the 
production, processing and dist ribution within the EU and 
the introduction from third countries of products of animal 
origin and products obtained therefrom intended for 
human consumption. 
 
Directive 2000/29/EC 2014 Protective measures against the introduction into member 
States from other member Stat es or third countries of 
organisms which are harmful to plants or plant products. Inter alia , it also concerns: protective measures against 
the spread of harmful organi sms within the EU by means 
related to movements of plants, plant products and other related objects within a member State; and the model of 
‘Phytosanitary Certificates’ and ‘phytosanitary certificates 
for Re-export’ or their electronic equivalent issued by member States under the International Plant Protection Convention (IPPC). 
Source: EU Commission. 
3.100.  The main regulatory committee involved in the development of SPS measures in the EU is 
the Standing Committee on Plants, Animals, F ood and Feed (which replaced the Standing 
Committee on the Food Chain and Animal Health, and the Standing Committee on Plant Health).104 
                                                                                                                                               
reproductive material, and official controls respectively). See also WTO documents G/TBT/N/EU/116 and 117 
(on plant reproductive material and official controls respectively). 
104 Regulation (EU) No. 652/2014, Article 48. WT/TPR/S/317 • European Union 
 
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  The European Food Safety Authority (EFSA) is an independent risk assessment body of the EU, 
which provides scientific advice on existing and emerging risks related to SPS matters, including food safety, and the authorization of genetically -modified organisms. The Food and Veterinary 
Office (FVO) of the Commission is responsible for audits, inspections, and related activities to 
assess compliance with EU food safety and quality,  animal health and welfare, and plant health 
legislation within the European Union, and compliance with EU import requirements in third countries exporting to the EU. 
3.101.  In addition to the authorities at the EU level, each member State has its own authorities 
responsible for food safety, animal and plant health, and the environment. 
3.102.  EU member States are members of the Codex Alimentarius  Commission, the World 
Organization for Animal Health (OIE), and contract ing parties to the International Plant Protection 
Convention (IPPC). The EU itself is a member of Codex and a contracting party to the IPPC. 
3.103.  Since the last Review
105, agreements on deep and comprehensive free trade areas 
(DCFTA) have been signed and are provisionally in force with Georgia and Moldova. These 
agreements include provisions relating to SPS measures. In addition, the Association Agreement 
between the EU and the Central American region (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama) and the FTA with Colomb ia and Peru also include provisions on SPS 
measures (Section 2.3.2). 
3.104.  According to the Commission, SPS measures taken in the EU are normally based on 
international standards or, in other cases - including the absence of an international measure - based on the scientific opinion of the EFSA. 
3.1.9.1  Live animals and animal products 
3.105.  To be eligible to export live animals or pr oducts of animal origin to the EU, the competent 
authority of the exporting country must be formally  recognized by the Commission as being able to 
"ensure credible inspection and controls throughout the production chain, which cover all relevant 
aspects of hygiene, animal health and public health."
106 The addition of a third country, territory, 
zone or compartment to the list of approved expo rters usually requires a visit from the FVO. For 
certain food products which may pose a risk to pu blic health (such as meat, and aquaculture), the 
Commission must approve the residue monitoring  programme, the salmonella control programme 
for poultry and poultry products, and other requirem ents depending on the animal and/or product. 
The Commission then prepares draft legislation to include the third country, territory, zone or 
compartment on the lists for animal and public health status provided the Standing Committee on 
Plants, Animals, Food and Feed agrees.107 
3.106.  An establishment from a third country that  wishes to be added to the list of eligible 
exporters is first required to contact its national authorities that may then make a request to the 
FVO through its competent national authority. 
3.107.  As noted in the last Review, an import consignment of live animals or animal products 
must be accompanied by a health certificate stating that the products or animals meet EU import 
requirements.108 The consignment must undergo official cont rols at an approved Border Inspection 
Post (BIP). It may also be subject to additional controls in the member State of destination. The 
official border controls include documentary, identity, and physical checks.109 The frequency of 
physical checks may be reduced for products of animal origin subject to EU harmonized 
requirements, taking into account the risk profile of the product concerned.110 Imports of live 
                                               
105 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, para. 3.114. 
106 Commission (2007), EU import conditions for fre sh meat and meat products, Directorate-General for 
Health and Consumers. 
107 Commission Regulation (EC) No. 798/2008, Annex 1. 
108 WTO document WT/TR/S/284/Rev.2, section 3.115-118. 
109 Consignments of live animals and products of animal origin must also be accompanied by the model 
health certificate set out in EU legislation for the relevant species or product. In the absence of an EU model 
health certificate for a particular species or prod uct, member States may establish their own import 
requirements. 
110 Decision 94/360/EC, 20 May 1994 (OJ L 158, 25 June 1994). WT/TPR/S/317 • European Union 
 
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  animals must be notified to the BIP at least 24 hours before arrival and imports of products of 
a n i m a l  o r i g i n  m u s t  b e  n o t i f i e d  b e f o r e  a r r i v a l .  Notifications must be submitted electronically 
through the TRAde Control and Expert System (TRACES)111 which is an electronic communication 
tool that allows all veterinary inspectors in BIPs to manage the outcome of the border controls 
carried out and to trace specific consignments to their destination. A list of countries and products 
subject to special import conditions is maintained and published by the Commission.112 
3.1.9.2  Plants and plant products 
3.108.  Imports into the EU of most plants and pl ant products from most countries do not require 
prior approval or notification although they ar e subject to rules on food safety and customs 
procedures and inspection. The competent authorities in the member States must be notified of imports of some food and feed products of non-animal origin from specified third countries which 
must enter the EU through designated points of  entry where they are subject to additional 
controls.
113 The list of products and exporting countries is reviewed quarterly. Furthermore, for 
phytosanitary reasons, imports of certain plants and plant products must be accompanied by a 
phytosanitary certificate from the competent author ity of the exporting country and are subject to 
special requirements, or may be prohibited if originating from specified areas.114 
3.1.9.3  Rapid Alert System for Food and Feed 
3.109.  The Rapid Alert System for Food and Feed (RASFF) allows food and feed authorities of the 
member States and the Commission to exchange information about measures taken in response to direct and indirect risks to human health from food, and human and animal health and the environment from feed.
115 Member States notify risks detected in products already on the market 
(market notifications) and when products are re fused entry into the EU (border rejections). 
Table 3.9 RASFF notifications, 2011-14 
Year Alerta Border 
rejectionb Informationc Information 
for attentiond Information 
for follow-upe 
Original notification       
2011 617 1,824 0 718 551 
2012 526 1,715 0 682 509 
2013 585 1,443 0 680 429 
2014 732 1,358 0 609 398 
Follow-up notification       
2011 2,265 1,053 421 480 1,126 
2012 2,312 906 74 663 1,326 
2013 2,376 525 1 763 1,493 
2014 3,288 581 2 670 1,368 
a Alert notifications are sent when a food or feed pr esenting a serious health risk is on the market and 
when rapid action is required. 
b Border rejections concern food and feed consignm ents that have been test ed and rejected at the 
external borders of the EU (and the EEA ) when a health risk has been found. 
c Information notifications are used when a risk has been identified about food or feed placed on the 
market, but the other members do not have to take rapid action. 
d Information notifications for attention are related to a product that is present only in the notifying 
member country, or has not been placed on the market, or is no longer on the market 
e Information notifications for follow-up are related to a product that is, or may be placed on the 
market on another member country. 
Source: Commission for 2014 and Commission (2014), RASFF - The Rapid Alert System for Food and Feed - 
2013 Annual Report,  Publications Office of the EU, pp 15-16. 
                                               
111 See: http://ec.europa.eu/food/animal/di seases/traces/about/index_en.htm  [March 2015]. 
112 The list of products and expo rting countries may be found at: 
http://ec.europa.eu/food/animal/bips/special_imports_en.htm  [February 2015]. 
113 Commission Regulation (EC) No. 669/2009, Annex I 
114 Council Directive 2009/29/EC, Annexes III, IV, and V. 
115 Article 50 of the General Food Law sets out the criteria for notification to the RASFF. WT/TPR/S/317 • European Union 
 
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  3.1.9.4  The SPS Committee of the WTO 
3.110.  The European Union and each member State have notified enquiry points under the SPS 
Agreement.116 The Directorate General for Health and Food Safety of the European Commission is 
the EU notification authority.117 
3.111.  In 2013 and 2014, the EU made a total of 151 notifications to the Committee on Sanitary 
and Phytosanitary Measures in the WTO, of which:  1 was a corrigendum, 68 were addenda, 8 were 
emergency notifications, and the remaining 74 were regular notifications. They also included the 
Commission proposals for the agri-food chain referred  to above. During this period, France was the 
only member State to notify an SPS measure with an addendum.118 D u r i n g  t h i s  p e r i o d  W T O  
Members also used the SPS Committee to raise ten new specific trade concerns about measures taken in the EU or a member State
119 and referred to three concerns that had been raised 
earlier.120 The Commission noted that the EU has also used the Committee to raise its concerns 
with SPS measures taken by other WTO Members, in  particular trade restrictions related to BSE 
and measures introduced by India and the Russian Federation. 
3.2  Measures Directly Affecting Exports 
3.2.1  Export procedures and requirements 3.112.  In general, procedures applied to exports are similar to those applied to imports 
(section 3.1.1). Simplified procedures may also be granted to exporters. 
3.113.  Traders or their representatives must log, either in writing or electronically, pre-departure 
declarations for safety and security purposes. The pre-departure declaration can be based on the export declaration complemented, where appropriate by security-related data, or on an exit 
summary declaration. 
3.2.2  Export taxes, charges, and levies 3.114.  The EU does not impose export-related duties or taxes. Inward processing under the 
drawback system will be eliminated when the UCC applies.
121 
3.2.3  Export prohibitions, restrictions, and licensing 3.115.  There are few EU export restrictions.
122 Dual-use items export control and diplomatic trade 
measures (with partial overlaps between the two regimes) are further detailed in this section. 
Regarding waste shipments, a description is included in section 3.2.5. 
3.2.3.1  Dual-use items export control regime 3.116.  Dual-use export controls implement intern ational commitments to prevent the proliferation 
of Weapons of Mass Destruction (WMD), in particular under UN Security Council Resolution 1540 
(2004), international agreements such as the Chem ical Weapons Convention (CWC), the Biological 
                                               
116 WTO document G/SPS/ENQ/26, 11 March 2011. 
117 WTO document G/SPS/NNA/16, 11 March 2011. 
118 WTO document G/SPS/N/FRA/8/Add.1 of 11 January 2013. 
119 Ban on Bisphenol A (France) (WTO SPS Information Management System ID 346); EU quarantine 
measures on certain pine trees and other products (ID 348); Prohibition on use and sale of treated seeds (ID 
350); EU temperature treatment requirements for imports of processed meat products (ID 351); EU renewal of GMO approvals (ID 353); EU import requirements for orchid tissue culture plantlets in flasks (ID 355); Phytosanitary measures on citrus black spot (ID 356); EU ban on mangoes and certain vegetables from India (ID 374); EU withdrawal of equivalence for processed or ganic products (ID 378); and EU revised proposal for 
categorization of compounds as endocrine disrupto rs (ID 382). See: WTO SPS Information Management 
System. Viewed at: http://spsims.wto.org/ . 
120 EU Court of Justice ruling regarding pollen de rived from GMOs (ID 327); Ma ximum residue levels of 
pesticides (ID 306); and Application and modification of the EU Regulation on Novel Foods (ID 238). See: WTO SPS Information Management System. Viewed at: http://spsims.wto.org/ . 
121 Operation may continue under the inward processing  procedure. This procedure may be used even if 
non-EU goods are not intended for re-export from the EU. 
122 For an exhaustive list of these meas ures see notification G/MA/QR/N/EU/2. WT/TPR/S/317 • European Union 
 
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  and Toxin Weapons Convention (BTWC) and the Nuclear Non-Proliferation Treaty (NPT), and 
multilateral export control regimes such as the Wassenaar Arrangement (WA), the Nuclear Suppliers Group (NSG), the Australia Group and the Missile Technology Control Regime (MTCR). 
The EU is not a member of the MTCR and the WA arrangement, but EU member States participate 
in those regimes. In the NSG, the EU, represented by the EU Commission, has observer status, 
while it is a full member in the Australia Group. The decisions of the regimes regarding the lists of items to control are integrated into EU law. 
3.117.  The EU export control regime for dual -use items is governed by Regulation (EC) 
No. 428/2009, Regulation (EU) No. 599/2014 of the European Parliament and of the Council of 
16 April 2014 and Commission Delegated Regulation (EU) No. 1382/2014 of 22 October 2014. These regulations provide common EU control rules, a common EU control list and harmonized 
policies for implementation. Under the EU regime, the export of dual-use items is subject to 
control and dual-use items may not leave the EU customs territory without an export authorization. The requirement for an export authorization applies to: 
− dual-use items listed in the EU Control List, in Annex I to the Regulation. The EU Control List 
is based on the lists adopted by international export control regimes listed above; 
− non-listed items may also be controlled under the so-called "catch-all"/end-use clause, 
under certain conditions listed in the relevant articles of the Regulation. 
3.118.  EU member States may exceptionally impose additional controls on non-listed dual-use 
items for reasons of public security or human rights consideration (Article 8 of the Regulation). Such measures are listed in the C series of the Official Journal of the European Union .
123 
3.119.  In specific cases, the export of dual-use items may be subject to additional EU restrictive 
measures (sanctions). Such measures currently apply with respect to trade of dual-use items with the Russian Federation, Democratic People's Republic of Korea, Iran, and Syria. 
3.120.  Article 215 of the Treaty on the Functionin g of the European Union (TFEU) provides a legal 
basis for the interruption or reduction, in part or completely, of the Union’s economic and financial relations with one or more third-countries, where such restrictive measures are necessary to 
achieve the objectives of the Common Foreign and Security Policy (CFSP). These may also pertain 
to the export of dual-use items, as indicated above. 
3.121.  The Regulations on export controls are bi nding and directly applicable throughout the EU, 
but the member States need to take certain me asures in order to implement some of their 
provisions, e.g. in relation to breaches and appl icable penalties, and an overview of national 
measures is published at regular intervals. Dual-use items may be traded freely within the EU, except for some particularly sensitive items, wh ere transfer within the EU is subject to prior 
authorization (see Annex IV of the Regulation). Th e Regulations set-up an EU network of export 
control authorities and contains provisions supporting the exchange of information as well as administrative cooperation among the member States and increasing transparency across the EU. 
Additional provisions also deal with specific control measures to be introduced by exporters, such 
as record-keeping and registers. 
3.122.  There are four types of export authorization in place in the EU export control regime: 
− EU General Export Authorizations (EUGEAs), that allow for the export of dual-use items to 
certain destinations under certain conditions  (see Annex II of the Regulation). There are 
currently 6 EU GEAs in place; 
− National General Export Authorisations (NGEAs), that may be issued by EU member States if 
they are consistent with existing EUGEAs and do not refer to items listed in Annex IIg of 
Regulation (EC) 428/2009. Such authorizations  are currently applied in France, Germany, 
Greece, Italy, the Netherlands, and the U.K.; 
                                               
123 See: http://ec.europa.eu/trade/import-and-e xport-rules/export -from-eu/dual-use-
controls/index_en.htm . WT/TPR/S/317 • European Union 
 
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  − Global licences, that may be granted by a national authority to an exporter and may cover 
multiple items to multiple countries of destination or end-users; and 
− Individual licences that may be granted by a national authority to one exporter to cover 
exports of one or more dual-use items to one end-user or consignee in a third country. 
3.123.  In legal terms, Regulation (EU) No. 599/2014, which allows the Commission to update the 
Annex I (the EU Control List) has been a major change to the framework for EU export control policy in 2014 and cleared the way for the Commission to incorporate modifications agreed by the 
multilateral export control list from 2011 to 2 013. Also, on 24 April 2014 the Commission issued a 
Communication to the Council and the European Parliament entitled "The Review of export control policy: ensuring security and competitiveness in a changing world."
124 The Communication does 
not contain legislative proposals: these are deferre d to a second stage, af ter the conduct by the 
Commission of an impact assessment to identify the most suitable regulatory and non-regulatory 
actions. The Communication starts from the premis e that the adoption of the first EU strategy 
against weapons of massive destruction (WMD) was conceived ten years ago and should now be 
adapted to face a changing technological, political, and economic environment. It then maps out 
policy options to that effect, identifies growing proliferation threats from both States and non-State actors, and links these with technological and IT developments, as well as an increasing 
vulnerability of interconnected global trading and information systems. In this context security has 
become key elements of supply chains. According to the Communication, the frontier between civil 
and military technologies is increasingly blurred and, as a result, trade in dual–use items is growing. 
3.2.4  Export credit, insurance, and promotion 
3.124.  Export credit policy falls under the scope  of common commercial policy. In practice, the EU 
works in the area of export credits in partnership with the member States. 
3.125.  Export credits in the EU, mainly taking th e form of credit insurance, are provided at the 
member State level. Most member States of the EU have their own agencies to provide export credits, providing short-term (up to two years) , and long-term (more than two years) credit 
insurance (Table A3.3). 
3.126.  As detailed in the Commission Communication on short-term export-credit insurance, state 
insurers
125 cannot provide insurance against marketable risks.126 Marketable risks are those 
commercial and/or political risks in the countries listed in the Annex to the Communication. The 
Annex was amended in January 2015, continuing to exclude Greece from countries with 
marketable risks until 30 June 2015.127 The Commission stated that this is a response to the lack 
of sufficient private capacity of insurance/reinsurance which still caused difficulties in covering all 
economically justifiable risks particularly for small- and medium-sized exporters. Therefore from 
the EU perspective, marketable risk countries include Australia, Canada, Iceland, Japan, New Zealand, Norway, Switzerland, the United  States, and the EU member States (except 
Greece).  
3.127.  State insurance against non-marketable risks, i.e. short-term export credit to countries 
outside the list of marketable countries as well as long-term credit, are subject to the state aid control under EU competition legislation. EU member States are allowed to draw up schemes 
providing credit insurances for small- and medium-s ized exporters with small turnovers, for single-
risk cover with a maximum of two years, or in case  of general shortage of export credit insurance. 
However, such schemes must be notified to the Commission for state-aid assessment, and be 
                                               
124 For the full text of the Communication see: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri 
=COM:2014:0244:FIN:EN:PDF . 
125 A State insurer is defined as a company or other organization that provides export-credit insurance 
with the support of, or on behalf of, a member State, or  a member State that provid es export-credit insurance. 
126 European Commission, Communication from the Commission to the Member States on the 
application of Articles 107 and 108 of the Treaty on th e Functioning of the European Union to short-term 
export-credit insurance,  8 January 2013 (OJ C 392/1, 19 December 2012). 
127 Communication from the Commission amending  the Annex to the Communication from the 
Commission to the member States on the application of Article 107 and 108 of the Treaty on the Functioning of the European Union to short-term export-credit insurance (OJ C 28/1, 28 January 2015). WT/TPR/S/317 • European Union 
 
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  subject to approval by the Commission before im plementation. According to the Commission, data 
of the scale of non-marketable short-term export credits is not available at the EU level. 
3.128.  In the area of medium- and long-term in surance, the EU is a participant to the OECD 
Agreement on Officially Supported Export Credits.128 The OECD Agreement sets limits on the 
repayment terms which are generally 10 years for most countries and sectors, but are shorter for 
higher- income countries; the Arrangement also sets a limit on the length of the grace period of six months. According to the OECD, in 2013 EU member States provided a total of US$36.1 billion 
long-term export credits, of which Germany acco unted for the largest proportion with US$10.97 
billion, followed by Italy (US$5.34 billion) , France (US$4.26 billion), United Kingdom 
(US$3.73 billion), and Sweden (US$3.21 billion). 
3.129.  The EU set the export refund at zero for all agricultural products on 13 July 2013 (section 
4.2). 
3.130.  Export promotion remains a competence of the EU's member States. The EU continues 
implementing its 2006 market access strategy in pa rtnership with the member States to target 
market access barriers to third countries.
129 
3.2.5  Waste shipment trade regime 3.131.  To address the problem of uncontrolled tr ansport of waste, Regulation (EC) No. 1013/2006 
of 14 June 2006 on shipments of waste lays down procedures for transboundary shipments (i.e. 
transport) of waste. This Regulation implements into EU law the provisions of the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal
130, as well as 
the OECD decision concerning the control of transboundary movement of wastes destined for 
recovery operations.131 The Regulation includes a ban on the export of hazardous wastes to non-
OECD countries ("Basel ban") as well as a ban on the export of waste for disposal. 
3.132.  Different regimes apply to shipments of wast es for disposal and for recovery, as well as to 
hazardous and "green-listed" non-hazardous wastes. The shipment of hazardous wastes and 
wastes destined for disposal is subject to a notifi cation procedure and requires the prior consent of 
all relevant competent authorities of the countries of dispatch, transit, and destination. However, 
as a general rule, shipments of "green-listed" waste for recovery within the EU, to OECD and 
certain non-OECD countries do not require the consent of the authorities. 
3.133.  Despite the Regulation, illegal shipments of waste are still a significant problem (some 
estimates suggest that the overall non-compliance rate with the Regulation could be around 25%). 
To strengthen member States' inspection systems,  this Regulation was amended in 2014 through 
Regulation (EU) No. 660/2014 of 15 May 2014132 which requires EU member States to establish 
inspection plans, including a minimum set of elements and based on a risk assessment. It also 
provides enhanced powers to the authorities invo lved in inspections to decide, on the basis of 
evidence, whether a carried substance or object is waste and whether a shipment can be considered an illegal shipment of waste. Member States are required to apply the new changes 
beginning in 2016/17. 
3.2.6  Diplomatic measures 3.134.  According to the Commission the use of measures in certain circumstances against third 
countries, individuals or entities, is an essential EU foreign policy tool to be used to pursue 
                                               
128 OECD (2014), Agreement on Officially Supported Export Credits , TAD/PG(2014)6, 24 July 2014. 
Viewed at: http://www.oecd.org/offi cialdocuments/publicdisplaydocument pdf/?doclanguage=en&cote=tad/pg(2014)6 . 
129 European Commission document COM(2007) 183 final, 18 April 2007. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2007/april/tradoc_134507.pdf .  
130 For the full text of the Convention see: 
http://www.basel.int/TheConvention/Overview/TextoftheConvention/tabid/1275/Default.aspx . 
131 Decision of the OECD Council C (2001)107/final as amended by decision C (2004) of, a consolidated 
version of this decision can be viewed at: http://www.oecd.org/environment/waste/30654501.pdf . 
132 Official Journal L189 of 27 June 2014. Viewed at: http://eur-lex.eu ropa.eu/legal-
content/FR/TXT/PDF/?uri=CELEX:32014R0660&from=EN . WT/TPR/S/317 • European Union 
 
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  objectives in accordance with the principles of the Common Foreign and Security Policy (CFSP). 
Some EU measures result from resolutions adopte d by the UN Security Council under Chapter VII 
of the UN Charter. However, the EU may also decide to apply autonomous measures within the framework of the CFSP. The decision-making proce ss is the following: there should first be a 
political agreement by the European Council for new or amended measures before legal acts are 
formally proposed; if there is an agreement, the Council first adopts, by unanimity, a CFSP 
Decision under Article 29 of the Treaty on the Euro pean Union (TEU), on a formal proposal by the 
member States or by the High Representative of the Union for Foreign Affairs and Security Policy 
(HRVP) (via the European External Action Servic e (EEAS)). The measures foreseen in that Council 
Decision are either implemented at EU level or at national level. 
3.135.  When the measures are implemented at EU level, the HRVP and the Commission, under 
Article 215 of TFEU, make joint proposals for regulations and implementing measures that can, 
depending on the specific cases, affect EU economic relations with a third country. These regulations are adopted by the Council, acting by qualified majority. Such Regulations are binding 
and directly applicable throughout the EU, and they  are subject to judicial review by the Court of 
Justice and the General Court in Luxembourg. Other measures, such as arms embargoes or visa bans, are implemented directly by the member States, which are legally bound to act in conformity 
with CFSP Council Decisions.  
3.136.  Council Decisions on EU autonomous sanctions or EU additions to UN sanctions are 
reviewed at regular intervals, usually once a year , to ensure measures are adjusted as needed, in 
line with developments affecting the stated objectives and the effectiveness of the measures.
133 
3.137.  All EU restrictive measures can be found on the EEAS webpage.134 All measures and 
regulations are published in the Official Journal of the EU . According to the Commission, during the 
review period, the EU adopted new measures but ha s also reduced the scope of existing sanctions: 
• new measures adopted (in the sense that the geographical coverage is affected): 
o Central African Republic (December 2013) (UN based135): embargo on arms and 
related materiel; ban on provision of certain services (financial technical assistance 
transport related to arms); and the legal framework for an asset freeze (although 
no persons are specifically listed yet); 
o Yemen (December 2014) (UN based136): asset freeze and visa ban; 
o Ukraine: restrictive measures in response to events in Crimea and Sevastopol 
(import embargo, investment ban, export restrictions, prohibition of services 
relating to infrastructure and the tourism sector) (since June 2014); restrictive measures in respect of actions relating to Ukraine (asset freeze) 
(since March 2014); freezing of funds and economic resources of certain persons 
(since March 2014); and 
o Russian Federation (since July 2014): embargo on arms and related materiel; 
embargo on dual-use goods and technology if intended for military use or for a 
military end-user;  ban on imports of arms and related materiel; ban on provision of certain services related to arms and related material; ban on provision of certain services related to dual-use goods and technology; (deep water, Arctic and shale-
oil-related) controls on export of certain equipment for the oil industry;  controls 
on provision of certain related services etc; 
• reduction of existing scope of sanctions: 
                                               
133 EU External Action Service (EEAS)  online information. Viewed at:  
http://eeas.europa.eu/cfsp/sanctions/index_en.htm  [March 2015]. 
134 See http://www.eeas.europa.eu/index_en.htm  [March 2015]. 
135 UN Security Council S/RES/2127(2013), 5 December 2013. 
136 UN Security Council S/RES/2140(2014), 26 February 2014. WT/TPR/S/317 • European Union 
 
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  o Myanmar: all measures repealed in April 2013 except an embargo on arms and 
related items; a ban on exports of equipment for internal repression; and a ban on provision of certain services;  
o Serbia and Montenegro: repealed in October 2014, specific restrictive measures 
directed against Mr Milosevic and persons associated with him; and 
o Republic of Guinea (Conakry): arms emba rgo, embargo on equipment which might 
be used for internal repression lifted on 14 April 2014; there remains an 
asset-freeze, and visa ban on persons identified by the International Commission 
of Inquiry. 
3.3  Measures Affecting Production and Trade 3.3.1  Subsidies 
3.3.1.1  EU level support 
3.138.  At the EU level, support is primarily provided under agriculture and regional policy 
instruments. According to the Commission, regional policy is an investment policy with the goal of 
supporting job creation, competitiveness, econ omic growth, improved quality of life, and 
sustainable development.
137 Most support under regional policy is provided through the European 
Regional Development Fund (ERDF), the European So cial Fund (ESF), the Cohesion Fund (CF), and 
the European Agriculture Fund for Rural Development (EAFRD). The legal basis for these funds 
may be found in several regulations by the Parliament and Council, along with delegated and implementing acts by the Commission. In addi tion, the European Agriculture Guarantee Fund 
(EAGF) provides for direct payments and market measures related to agriculture (see Section 4.2), 
and the European Maritime and Fisheries Fund provides public support to the fishery and 
aquaculture sector and for the implementation of the integrated maritime policy in Regulation (EU) No. 508/2014 of the European Maritime and Fisheries Fund. 
3.139.  The rules on EU aid are reviewed every seven years and the current package was adopted 
on 17 December 2013 (along with Regulation (EU) 1305/2013 on support for rural development by the EAFRD): 
• Regulation (EU) No. 1303/2013 laying down common provisions on the European Regional 
Development Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund and laying down general provisions on the European Regional Development Fund, the 
European Social Fund, the Cohesion Fund, an d the European Maritime and Fisheries Fund 
and repealing Council Regulation (EC) No. 1083/2006; 
• Regulation (EU) No. 1301/2013 on the European Regional Development Fund and on 
specific provisions concerning the investment for growth and jobs goal and repealing 
Regulation (EC) No. 1080/2006; 
• Regulation (EU) No. 1304/2013 on the European Social Fund and repealing Council 
Regulation (EC) No. 1081/2006;  
• Regulation (EU) No. 1299/2013 on specific provisions for the support from the European 
Regional Development Fund to the European territorial cooperation goal; 
• Regulation (EU) No. 1302/2013 amending Regu lation (EC) No. 1082/2006 on a European 
grouping of territorial cooperation (EGTC) as regards the clarification, simplification and 
improvement of the establishment and f unctioning of such groupings; and  
• Regulation (EU) No. 1300/2013 on the Cohesion Fund and repealing Council Regulation 
(EC) No. 1084/2006. 
                                               
137 European Commission online information. Viewed at: 
http://ec.europa.eu/regional_policy/index_en.cfm  [January 2015]. WT/TPR/S/317 • European Union 
 
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  3.140.  As at December 2014, the budget prov ision for the 2014-2020 Cohesion Policy was 
€347.6 billion which, when combined with the contributions from member States, is likely to reach almost €500 billion. By the end of 2014 operat ional programmes had been submitted by the 
28 member States and 154 programmes had been adopted with €16.8 billion committed by the 
EU. 
3.141.  The last notification from the EU on su bsidies and member States' addenda provided data 
up to end-2012 showing that, leaving the Commo n Agricultural Policy and Common Fisheries 
Policy aside, subsidies under the ERDF, ESF, and CF were greatest in 2012 with €29.4, €11.3, and 
€8.7 billion respectively.
138 
3.3.1.2  State aid 3.142.  Under Articles 107 to 109 of the TFEU, state aids which favour certain undertakings or 
production of certain goods are, in general, prohibited as incompatible with the internal market. 
However, there are a number of exemptions and the Commission is responsible for preparing detailed rules on compatibility of state aids with the internal market, examining notifications of aid 
schemes (which should be approved before aid may be provided), setting general exemptions from 
the notification requirements, and recovering incompatible state aid. 
3.143.  A set of interrelated instruments (Council regulations, and Commission guidelines and 
notices) provides guidance on the application of the articles of the TFEU on state aid. In May 2012, 
the Commission published the "State Aid Modernisation (SAM)", a Communication to the Parliament, the Council, the European Economic and Social Committee, and the Committee on the 
Regions outlining a plan for reform of these ru les and guidelines. The Communication noted the 
link between state aid and the Europe 2020 growth  strategy and sets out the objectives for the 
SAM which include: 
• better targeting of aid to areas that would im prove growth, such as some infrastructure 
programmes, while improving controls to limit distortions to competition and improving the 
functioning of the internal market. The Communication proposes that common principles be established for assessment of compatibility of aid with the internal market and streamlining 
of guidelines consistent with these common principles;  
• focusing enforcement on cases with most impact by reviewing the de minimis  Regulation, 
the Enabling Regulation and General Block Exemption Regulations (on categories of aid compatible with the internal market and, ther efore, exempt from prior notification) while 
emphasising the need for compliance by member States and ex post  controls by the 
Commission; and  
• streamlining rules and allowing faster decisions through clarification and simplification of the 
rules and modernizing the regulation on complaints and market information.
139 
3.144.  Under SAM the Commission has held consultations (open to all interested parties) and 
adopted new guidelines on state aid in several sectors, and introduced, amended, or revised 
several regulations. Table 3.10 sets out the change s to the rules and guidelines on state aid which 
became applicable in 2013 and 2014, including those under SAM.140 
3.145.  Under Article 107.3(a) and (c) of the TFEU and Commission Guidelines on regional State 
aid for 2014-20, the Commission may approve aid to  disadvantaged areas within the EU, the goal 
of which is to achieve increased economic activity in the assisted areas which "outweigh potential 
                                               
138 WTO document G/SCM/N/253/EU, 29 July 2013. Subsid ies granted by individual member States are 
contained in addenda to this notification. 
139 Commission (2012), Communication from the Commission to th e European Parlia ment, the Council, 
the European Economic and Social Committee and the Committee of the Regions - EU State Aid Modernisation 
(SAM) , COM/2012/0209 final. 
140 For a detailed list of rules on state aid as at 15 April 2014, see Commission (2014), EU Competition 
Law – Rules applicable to State Aid – Situation as at 15 April 2014,  Luxembourg, Office for Official Publications 
of the European Union. WT/TPR/S/317 • European Union 
 
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  negative effects in terms of restrictions to trade and competition within the internal market."141 
The most recent guidelines entered into force on 1 July 2014 (see below).142 
Table 3.10 Changes to EU rules on state aid, 2013 and 2014 
Title/reference Entry into 
force Note 
General 
Commission Regulation (EU) No. 651/2014 declaring 
certain categories of aid compatible with the internal 
market in application of Articles 107 and 108 of the 
Treaty 
OJ L 187/1 26/06/2014 01/07/2014 • The general block exemption regulation 
• Increase in thresholds for notifying aid 
• Improved ex post  controls and monitoring 
• Transparency through publications of lists of aid 
beneficiaries 
 
Council Regulation (EU) No. 733/2013 amending 
Regulation (EC) No. 994/98 on the application of Articles 92 and 93 of the Treaty establishing the European Community to certain categories of horizontal State aid  
OJ L 204/11 31/07/2013 
 20/08/2013 • Enabling regulation 
• New categories exempt from prior notification 
include innovation, culture, natural disasters, sport, broadband, etc 
Council Regulation (EU) No. 734/2013 amending 
Regulation (EC) No. 659/1999 laying down detailed 
rules for the application of Article 93 of the EC Treaty 
OJ L 204/15 31/07/2013 20/08/2013 • Procedural regulation
• Objective to improve time required for handling 
complaints, and the transparency and conduct of 
sector enquiries as well as cooperation with national 
courts 
 
Commission Regulation (EU) No. 372/2014 amending 
Regulation (EC) No. 794/2004 as regards the calculation 
of certain time limits, the handling of complaints, and 
the identification and protection of confidential information OJ L 109/14 12/04/2014 
 22/04/2014 • Implementing regulation amendment 
• Introduces a new mandatory complaint form, and 
measures relating to confidential information 
Commission Regulation (EU) No. 1407/2013 on the 
application of Articles 107 and 108 of the Treaty on the 
Functioning of the European Union to de minimis  aid 
OJ L 352/1 24/12/2013 01/01/2014 • Aid which does not exceed de minimis  amounts does 
not have to be notified 
• General de minimis  limit is €200,000 over three 
years, or €100,000 for road transport undertakings  
• Companies undergoing financial difficulty no longer 
excluded 
• Subsidised loans of up to €1 million may also be 
deemed de minimis  
 
Communication from the Commission amending the 
Communications from the Commission on EU Guidelines for the application of State aid rules in relation to the rapid deployment of broadband networks, on Guidelines on regional State aid for 2014-2020, on State aid for 
films and other audiovisual works, on Guidelines on 
State aid to promote risk finance investments and on Guidelines on State aid to airports and airlines OJ C 198/02 27/06/2014 
 • 
Transparency Communication  
• Member States shall establish websites for the 
publication of information on all aid measures and their beneficiaries, except for aid awards of less than €500,000 
 
Sectoral (including agriculture and fisheries) 
Communication from the Commission on State aid for 
films and other audiovisual works 
OJ C 332 15/11/2013 15/11/2013 • Cinema Communication  
• Allows aid for a wider scope of activities, highlights 
member States' discretion in defining cultural 
activities worthy of support, introduces the possibility to give more aid to cross-border productions and promotes film heritage 
 
EU guidelines for the application of state aid rules in 
relation to the rapid deployment of broadband networks  
OJ C 25/1 26/01/2013 16/01/2013 • Broadband Guidelines
• Reinforcement of open access obligations and 
improved transparency rules 
 
                                               
141 Commission (2013), Staff Working Document – Executive Summary of the Impact Assessment - 
Accompanying the document Communication from the Commission Guidelines on regional state aid for 2014 – 
2020, C(2013) 3769 SWD, (2013) 214. 
142 Guidelines on regional State aid for 2014-2020, OJ C 209 23/07/2013. WT/TPR/S/317 • European Union 
 
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  Title/reference Entry into 
force Note 
Communication from the Commission - Guidelines on 
State aid to airports and airlines OJ C 99/03 04/04/2014 04/04/2014 • Operating aid to regional airports (with less than 3 
million passengers a year) allowed for a transitional period of 10 years under certain conditions  
• State aid for investment in airport infrastructure 
allowed if there is a genuine transport need and 
public support is necessary to ensure the 
accessibility of a region, maximum permissible aid intensities depend on the size of an airport, the aim is to avoid overcapacity and/or duplication 
• Simplified rules for start-up aid for airlines to fly to 
new destinations, limited in time  
 
EU Guidelines for State aid in the agricultural and 
forestry sectors and in rural areas 2014 to 2020 
OJ C 204/01 01/07/2014 01/07/2014 • Adopted for the programming period 2014 - 2020
• Transparency provisions for publishing member 
State decisions on aid 
• New provisions on the common assessment 
principles (incl. effectiveness of the aid, 
appropriateness, incentive effect) 
• Chapter on forestry provides for more detailed 
provisions on the respective forestry measures 
• The Commission reserves the right to seek 
additional information on existing aid schemes on a 
case by case basis, where this is necessary to 
enable it to fulfil its responsibilities under Article 
108(1) of the Treaty 
 
Commission Regulation (EU) No. 702/2014 declaring 
certain categories of aid in the agricultural and forestry 
sectors and in rural areas compatible with the internal 
market in application of Articles 107 and 108 of the Treaty on the Functioning of the European Union OJ L 193/1 01/07/2014 01/07/2014 • Subject to limits, exempts from notification aid for 
agricultural enterprises, cultural and heritage 
conservation, repairing damage from natural 
disasters, research and development, and forestry 
• Certain measures are limited for SMEs (e.g. 
investment aid, start-up aid), certain measures can apply to large undertakings too (e.g. forestry 
measures, natural disaster measures) 
• New categories exempt from prior notification (e.g. 
certain forestry measures, and natural disaster schemes) 
• To ensure transparency, member States should be 
required to establish comprehensive state aid 
websites, at regional or national level, setting out summary information about each aid measure exempted under this Regulation. That obligation should be a condition for the compatibility of the 
individual aid with the internal market 
 
Commission Regulation (EU) No. 1408/2013 on the 
application of Articles 107 and 108 of the Treaty on the 
Functioning of the European Union to de minimis  aid in 
the agriculture sector 
OJ L 352/9 24/12/2013 01/01/2014 • Aid which does not exceed €15,000 to an 
undertaking over a 3 year period does not have to 
notified 
• List of criteria for determining when two or more 
enterprises within the same member State are to be 
considered a single undertaking 
 
Commission Regulation (EU) No. 717/2014 of 
27 June 2014 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis  aid in the fishery and aquaculture sector 
OJ L 190/45 28/06/2014 01/07/2014 • Aid which does not exceed €30,000 to an 
undertaking over a 3-year period does not have to notified 
• De minimis  aid cannot be granted, in particular, for 
the purchase of fishing vessels, for the 
modernization or replacement of main or ancillary 
engines of fishing vessels, to operations increasing the fishing capacity of a vessel, to the construction of new fishing vessels or importation of fishing vessels 
 
Commission Regulation (EU) No. 1388/2014 of 
16 December 2014 declaring certain categories of aid to 
undertakings active in the production, processing and 
marketing of fishery and aquaculture products 
compatible with the internal market in application of 
Articles 107 and 108 of the Treaty on the Functioning of 
the European Union 
OJ L 369/37 24/12/2014 01/01/2015 • Subject to limits, exempts from notification aid for 
the fishery and aquaculture sector which could have 
been supported by the European Maritime and 
Fisheries Fund (EMFF) and which respects the rules 
of the EMFF  
• Only covers aid to SMEs (with the exception of aid 
to make good the damage caused by natural 
disasters) 
 WT/TPR/S/317 • European Union 
 
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  Title/reference Entry into 
force Note 
Horizontal 
Guidelines on regional State aid for 2014-2020 
OJ C 209/1 23/07/2013 01/07/2014 • Increase in geographic and population coverage of 
regional aid 
• Reduced aid categories requiring prior notification to 
the Commission 
• All notified large aid measures will be subject to in-
depth assessment of their incentive effect, 
proportionality, contribution to regional 
development and effects on competition 
• A stricter approach on aid for investments made by 
large enterprises in the more developed assisted 
areas 
• Anti-relocation provisions 
 
Communication from the Commission – Guidelines on 
State aid for environmental protection and energy 2014-2020 
OJ C 200/01 28/06/2014 01/07/2014 • From 2015-16, pilot phase of competitive bidding 
procedures for renewable energy  
• Foresees switch to feed-in premiums to replace 
feed-in tariffs for electricity from renewables 
• Provisions on support for some energy intensive 
sectors 
• Provisions on improvements for cross border energy 
infrastructure
  
• Permits aid to secure adequate electricity generation 
when there is a real risk of insufficient electricity generation capacity 
Communication from the Commission – Guidelines on 
State aid to promote risk finance investments 
OJ C 19/4 22/01/2014 01/07/2014 • Expands scope to include (i) SMEs, (ii) small mid-
caps, and (iii) innovative mid-capsa 
• Sets out criteria for aid over €15 million 
• Expands range of means to provide aid 
• Private sector participation from 10-60% depending 
on age and risk profile 
Framework for State aid for research and development 
and innovation 
OJ C 198/1 27/06/2014  01/07/2014 • Notification thresholds increased 
• Higher aid levels permissible 
• Simplified assessment for R&D projects co-financed 
by the EU 
•Clearer criteria for non-economic activities 
Guidelines on State aid for rescuing and restructuring 
non-financial undertakings in difficulty 
OJ C 249/1 31/07/2014 
 01/08/2014 • New rules allowing temporary (at most 18 months) 
restructuring support for SMEs on the basis of a 
simplified restructuring plan, favouring measures 
that are less distortive, such as loans and 
guarantees, over structural aid, such as direct 
grants or capital injections 
• Member States will have to demonstrate that the aid 
is needed to prevent hardship and that the granting 
of restructuring aid will make a difference in that 
respect 
• New rules ensuring that investors pay a share of the 
costs of the firm's restructuring ("burden sharing"). 
Company investors will be primarily responsible for 
covering incurred losses before any state aid is 
granted, and the State will receive a fair return on 
its investment if the restructuring plan succeeds.  
Communication from the Commission - Criteria for the 
analysis of the compatibility with the internal market of State aid to promote the execution of important projects 
of common European interest 
OJ C 188/2 20/06/2014 01/07/2014 • Sets out the criteria the Commission will use to 
assess whether a project is important and of common European interest 
a 'Mid-cap' means an undertaking whose number of employees does not exceed 1,500; 'small mid-
cap' means an undertaking whose number of em ployees does not exceed  499, […], the annual 
turnover of which does not exceed €100 million or the annual balance sheet of which does not 
exceed €86 million, and 'innovative mid-cap' means a mid-cap whose R&D and innovation costs […] 
represent (a) at least 15% of its total operating costs in at least one of the three years preceding the first investment under the risk  finance State aid measure, or (b ) at least 10% per year of its 
total operating costs in the three years preceding the first investment under the risk finance State 
aid measure (Section 2.3 of Communication from the Commission – Guidelines on State aid to promote risk finance investments). 
Source: Commission; Commission online information on State Aid Modernisation (viewed at:  
http://ec.europa.eu/competition/state_aid/modernisation/index_en.html  [January 2014]); and press 
releases (viewed at http://ec.europa.eu/competition/state_aid/what_is_new/news.html  
[March 2014]). 
3.146.  The Commission regularly publishes the State Aid Scoreboard which is based on annual 
reports by the member States under Commission Regulation (EC) No. 794/2004. According to the WT/TPR/S/317 • European Union 
 
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  Scorecard, non-crisis-related state aid in 2013 was €63 billion. The biggest categories were 
environmental protection, regional development,  research, and development and innovation, and 
the agricultural sector. In addition, €42 billion in aid was provided for rail transport (€19 billion for public service obligations and pensions, and €23 billion for infrastructure and other aid) (Table 
3.11). 
3.147.  In absolute terms, in 2013, France, Germany, the United Kingdom, and Italy provided over 
half the total for non-crisis-related state aid in the EU (including support for public service 
obligations and pensions for rail transport) (Chart 3.3). In some member States, a significant 
portion of this aid was for public service obligations for rail transport (see below). As a proportion of GDP, non-crises-related state aid varied from one member State to another: from 0.2% of GDP in the U.K. and Italy in 2013; to 1.6% in Greece, Hungary, and Slovenia and 1.8% in Malta. In per 
capita terms, aid also varied: from over €400 per person in Denmark, Finland, and Luxembourg in 
2013; to less than €100 in Bulgaria, Croatia, Estonia, Italy, Lithuania, Poland, Portugal, Romania, Slovakia, Spain, and the U.K. 
Chart 3.3 State aid (including railway support  transport for pensions and public service 
obligations), 2013  
(€ million) 
 - 5,000 10,000 15,000 20,000 25,000
Rail transport (public service obligations + pensions)
State aid (less rail transport)
 
Source: Commission online information. Viewed at:  
http://ec.europa.eu/competition/state_aid/scoreboard/index_en.html  [January 2015].  
3.148.  Non-crisis-related state aid in the EU has been declining unsteadily since it peaked in 1997 
at €114 billion. The unsteady downward trend has continued in recent years with reductions in aid under most of the principal headings except en vironment, social support to consumers, and 
closure aid (Table 3.11). 
Table 3.11 Non-crisis-related state aid in the EU, 2008-13 
 
(€ million) 
 2008 2009 2010 2011 2012 2013 
Total State aid (excluding transport)a 76,605 79,443 73,010 66,353 66,740 62,737
Agricultural and fisheries   
Agriculture aid reported to DG Agriculture 
and Rural Development 11,879 10,933 9,372 8,961 8,861 8,095
Agriculture aid reported to DG Competition 24 197 186 296 371 242
Aid granted to fisheries and aquacultu re, 
reported by DG Maritime and Fisheries Affairs 292 209 135 112 84 70
Total agricultural and fisheries 12,195 11,338 9,693 9,369 9,317 8,407
Horizontal objectives   
Compensation fo r damage caused by 
natural disasters 13 4 43 113 35 85
Culture 1,570 1,650 1,820 1,952 2,301 2,427
Employment 3,297 2,851 2,897 2,797 2,827 2,856
Environmental protection incl. energy 
saving 14,124 15,458 14,723 13,326 14,414 14,912
Heritage conservation 22 45 69 77 45 86WT/TPR/S/317 • European Union 
 
- 70 - 
 
   2008 2009 2010 2011 2012 2013 
Promotion of export and internationalization 356 299 291 325 288 227
Regional development 13,809 15,832 13,529 12,430 11,538 11,369
Research, development, innovation 9,580 11,727 11,415 10,405 9,634 8,291
SME including risk capital 6,635 5,407 4,202 3,686 3,826 3,273
Social support 888 1,166 2,215 3,501 3,266 3,336
Training 902 1,040 906 939 1,104 841
Other 215 258 440 151 175 203
Total horizontal objectives 51,408 55,737 52,551 49,701 49,453 47,906
Sectoral development, rescue & 
restructuring, and closure aid   
Sectoral development 12,388 11,466 10,234 5,503 6,102 4,619
Rescue & restructure 617 1,079 703 560 694 504
Closure aid 22 20 16 1,516 1,515 1,542
Total sectoral aid 13,027 12,564 10,953 7,579 8,312 6,665
Transport (excluding railways)   
Road 420 213 149 235 249 123
Maritime transport 2,210 1,675 1,558 1,530 1,270 1,010
Inland water transport 11 11 19 23 18 20
Air transport 397 941 277 165 284 194
Other transport 367 321 235 221 79 41
Total transport aid (excl. railways) 3,405 3,160 2,237 2,174 1,899 1,387
Railways supportb   
Public service obligations and pensions .. .. .. .. 18,928 22,191
Infrastructure .. .. .. .. 19,008 23,354
Total railways support .. .. .. .. 41,119 42,315
.. Not available. 
a The total figure for state aid does not include transport aid,  agriculture aid reported to 
DG Competition, nor railways support. 
b The Commission noted that railways support includes a significant amount that is not classified as 
state aid. 
Source: Commission (2104), State Aid Scoreboard 2014.  Viewed at:  
http://ec.europa.eu/competition/state_aid/scoreboard/index_en.html  [January 2014]. 
3.3.1.3  Public service obligations and services of general economic interest 
3.149.  Services of general economic interest (SGEI)143 are defined as "services of an economic 
nature that public authorities identify as being of particular importance to citizens, but which are 
not supplied by market forces alone, or at least not to the extent and under the conditions requested by society" and "their provision may th erefore require public intervention" in order to 
meet public service obligations (PSO) imposed by a member State on one or more providers.
144 
3.150.  In December 2011, the Commission adopted a new package of state aid rules for SGEIs. 
The first parts of the package include reforms to the legislation on aids to SGEI and were adopted on 20 December 2011, and the final part of the package was adopted on 25 April 2012. The 
measures include: 
• a Communication from the Commission setting out the general background, providing 
explanations of key issues and giving an overvi ew of the concepts of state aid relevant to 
SGEIs
145;  
• a Commission Decision specifying the conditions under which compensation to companies 
for the provision of public services is compatible with state aid rules (a clearly defined public service mandate and no overcompensa tion) and is exempted from notification 
(i.e. the right to provide aid without prior approval by the Commission). The exemption 
was extended from hospitals and social housing to cover other categories and the 
                                               
143 Communication from the Commission 2012/C 8/02, Commission Decision 2012/21/EU, 
Communication from the Commission 2012/C 8/03, and Commission Regulation (EU) No. 360/2012. 
144 Pesaresi N, Sinnaeve A, Guigue-Korppen V, Wiemann J, Radulescu M (2012), The New state aid rules 
for services of general Ec onomic Interest (SGEI), Competition policy newsletter 2012-1, DG Competition, p.1. 
Viewed at: http://ec.europa.eu/competition/publications/cpn/2012_1_9_en.pdf  [December 2014]. 
145 Communication from the Commission on the applic ation of the European Union state aid rules to 
compensation granted for the provision of services of general economic interest, OJ C 8 11/01/2012. WT/TPR/S/317 • European Union 
 
- 71 - 
 
  notification threshold was reduced from €30 million to €15 million for aid directed towards 
public service providers in other categories146; 
• Communication from the Commission setting out a framework for state aid in the form of 
public service compensation which specifies the conditions under which compensation not 
covered by the Decision is compatible with state aid rules. Inter alia , the Communication 
requires that the public service obligations for an SGEI be clearly set out by the authorities in the member State, comply with EU publ ic procurement rules, and the aid does not 
exceed the cost of meeting the public service obligation plus a reasonable profit
147; and 
• Commission Regulation on de minimis  levels of support which exempts from notification 
aid for SGEI of up to €500,000 per company over a 3 year period.148 
3.3.1.4  Crisis-related state aid 
3.151.  From 2008 to 2010, in response to the financial crisis, the Commission adopted 
communications setting out sector-specific temporary rules on banking, recapitalization, impaired assets, and restructuring as well as horizontal rules in the Temporary Framework for state aid 
measures to support access to finance (or aid to the real economy). The Temporary Framework 
went through a number of changes before expiring in December 2011.
149 
3.152.  With effect from 1 August 2013, a new Banking Communication from the Commission 
replaced the 2008 Banking Communication and amended and supplemented the communications 
on recapitalization, impaired assets, and restructuring. The 2013 Banking Communication reasserted the importance of financial stability and noted the continuing fragility of the economic recovery in the EU. It also noted that "the fina ncial sectors in some member States face further 
challenges in accessing term funding and in asse t quality, stemming from the economic recession 
and public or private debt deleveraging. The st ress in financial markets and the risk of wider 
negative spill-over effects persist."
150 The main changes in the 2013 Banking Communication 
include: 
• a requirement for a restructuring plan, which must include the bank raising capital itself, 
before it can receive state recapitalization. Temporary approval without a restructuring 
plan is still possible if the supervisory auth ority can confirm that immediate action is 
required; 
• in the event that a bank's viability cannot be  restored, a plan to wind-down the bank must 
be submitted; 
• a requirement that shareholders and subordin ated debt-holders contribute to meeting a 
capital shortfall before public recapitalization or asset-protection measures can be taken unless they have already done so or financial stability is at risk; and 
• new and stricter rules on executive remuneration policies for failed banks. 
                                               
146 Commission Decision of 20 December 2011 on the application of Article 106(2) of the Treaty on the 
Functioning of the European Union to State aid in the fo rm of public service compen sation granted to certain 
undertakings entrusted with the operation of services of general economic interest, OJ L 7 11/01/2012. 
147 Communication from the Commission – European Union framework for St ate aid in the form of public 
service compensation (2011), OJ C 8 11/01/2012. 
148 Commission Regulation (EU) No. 360/2012 of 25 Ap ril 2012 on the application of Articles 107 and 
108 of the Treaty on the Functioning of the European Union to de minimis  aid granted to undertakings 
providing services of general economic interest (Text with EEA relevance), OJ L 114 26/04/2012. 
149 The first Communication on the temporary frame work was Communication from the Commission – 
Temporary Community framework for Stat e aid measures to support access to finance in the current financial 
and economic crisis (OJ C 16 22/01/2009), and the last was Communication of the Commission — Temporary Union framework for State aid measures  to support access to finance in the current financial and economic 
crisis (OJ C 6 11/01/2011). 
150 Communication from the Commission on the applic ation, from 1 August 2013, of State aid rules to 
support measures in favour of banks in the context of the financial crisis (‘Bankin g Communication’), OJ C 216 
30/07/2013. WT/TPR/S/317 • European Union 
 
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  3.153.  From October 2008 to October 2014, the Commission took more than 450 decisions on 
state aid measures to the financial sector, including authorization for a total of €3,893 billion in guarantees. However, effective use was less than one-quarter of the amount approved: outstanding guarantees peaked in 2009 at €835.8 billion and have declined considerably since 
then. Furthermore, as at October 2014, €3.1 billion of the guarantees have actually been called in. 
3.154.  Requests for, and use of, crisis-related state aid has varied from one member State to 
another: for some, no approval was given for crises-related aid (Bulgaria, Czech Republic, Estonia, 
Malta, Romania, and Croatia (which acceded to th e EU in 2013)); for Poland, and Slovakia aid was 
approved but not used; and for Lithuania, Hungary,  Finland, and Sweden relatively little aid was 
used. Among the other member States, use of instruments varied considerably in both nominal terms (Table 3.12) and relative to GDP. Compared to GDP: in Ireland, total guarantees and 
liquidity measures peaked at 174% in 2009, and recapitalization and asset-relief peaked at 25% in 
2010; and in Greece total guarantees and liquidity measures peaked at 34%, and recapitalization 
and asset relief at 16% in 2012. 
Table 3.12 Use of crisis-related aid in  selected EU member States, 2008-13 
 (€ billion) 
 
Belgium  
Denmark  
Germany  
Ireland  
Greece  
Spain  
France  
Italy  
Cyprus  
Latvia  
Luxembourg  
Netherlands  
Austria  
Portugal  
Slovenia  
Sweden  
UK  
TOTAL EU-27  
Guarantees 
2008 9.0 145.0 19.1 180.3 -  -  8.7 -  -  -  0.4 0.9 2.4  1.2  -  0.3 33.5 400.8 
2009 46.8 6.4 135.0 284.3 1.5  36.1 92.7 -  0.6 0.5 1.6 36.0 15.5  5.2  1.0  14.3 158.2 835.8 
2010 32.8 22.3 132.0 196.3 26.7  55.8 91.5 -  2.8 0.2 1.4 40.9 19.3  5.0  2.2  19.9 150.7 799.8 
2011 26.4 23.0 34.7 110.5 56.3  61.7 71.8 10.9 2.8 0.1 1.2 33.2 17.1  8.5  1.6  14.0 115.2 589.0 
2012 45.6 1.2 10.0 83.5 62.3  72.0 53.4 85.7 2.3 0.0 1.9 19.4 11.8  16.6  0.2  4.4 21.9 492.3 
2013 36.9 0.7 3.0 37.2 47.8  53.6 46.9 81.7 1.0 -  3.8 12.4 2.4  14.4  0.1  1.3 9.1 352.3 
Liquidity measures other than guarantees 
2008 - 0.6 3.6 - 0.5 2.3 - - - 1.0 - 13.2 -  1.1  -  - - 22.2 
2009 - 2.0 - - 4.3 19.3 - - - 1.0 0.1 30.4 -  3.7  -  - 6.9 70.1 
2010 - 0.7 4.7 - 6.9 19.0 - - - 0.9 0.1 7.9 -  3.8  -  - 18.5 62.6 
2011 - - - 0.1 6.6 13.5 - - - 0.8 0.1 3.8 -  2.5  -  - 33.3 60.6 
2012 - - - 0.7 2.8 3.5 - - - 0.6 0.1 3.8 -  0.2  -  - 32.7 44.3 
2013 - 0.0 - 0.9 2.3 0.2 - - - 0.6 0.1 3.8 -  -  -  - 26.8 34.6 
Recapitalization measures 
2008 16.9 0.5 20.0 - -  -  13.2 -  -  -  2.5 14.0 0.9  -  -  0.3 49.4 117.7 
2009 3.5 8.0 32.9 11.0 3.8  1.3 9.3 4.1 -  0.4 0.1 -  5.9  -  -  0.5 9.7 90.7 
2010 - 1.9 6.7 35.3 -  9.5 -  -  -  0.1 -  4.8 0.6  -  -  -  34.6 93.4 
2011 - 0.3 3.6 16.5 2.6  8.5 -  -  -  -  -  -  -  -  0.3  -  3.2 35.0 
2012 2.9 - 0.9 - 30.9  40.4 2.6 2.0 1.8 0.0 -  -  2.0  6.8  0.5  -  -  90.8 
2013 - - - - 3.5  2.1 -  1.9 -  -  -  4.2 1.8  1.1  2.4  -  3.3 20.5 
Asset relief interventions 
2008 - - 9.8 -  -  - - - - - - - -  -  -  - - 9.8 
2009 7.7 - 24.8 -  -  - 1.2 - - - - 5.0 0.4  -  -  - 40.4 79.5 
2010 - - 45.0 2.6  -  2.9 - - - 0.4 - - -  3.1  -  - - 54.0 
2011 - - - -  -  - - - - - - - -  -  -  - - - 
2012 9.4 - 0.4 -  -  25.5 - - - - - - 0.1  -  -  - - 35.4 
2013 - 0.0 - 0.9  2.3  0.2 - - - 0.6 0.1 3.8 -  -  -  - 26.8 34.6 
Note: -Zero, 0.0 is greater than zero but rounded to 0.0. 
 Other member States either did not use crisis-rel ated aid (Bulgaria, the Czech Republic, Estonia, 
Malta, Poland, Romania, and Slovakia) or relatively small amounts (Lithuania, Hungary, and Finland) while Croatia acceded to the EU in 2013 and has not sought authorization of crisis-related aid. 
Source: Commission State Aid Scoreb oard 2014 - Aid in the context of the financial and economic crisis 
http://ec.europa.eu/competition/state_aid/scoreboard/financial_economic_crisis_aid_en.html  
[March 2015]. WT/TPR/S/317 • European Union 
 
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  3.3.2  Competition policy and regulatory issues 
3.3.2.1  Overview 3.155.  The basic competition policy framework has remained unchanged since the previous 
Review. Articles 101-109 of the TFEU provide the ba sic competition principles: Article 101 prohibits 
agreements between two or more independent market operators that restrict competition; and 
Article 102 prohibits firms holding a dominant positi on from abusing that position. The main rules 
on procedures are found in Council Regulation (E C) 1/2003, which implements the rules laid down 
by Articles 101 and 102. Article 106(2) of the TFEU allows limited exceptions to the Treaty 
competition rules in favour of undertakings entrusted with the operation of services of general economic interest. Council Regulation No. 139/2004 set-out the rules on procedures for review of mergers and acquisitions. 
3.156.  Under Article 105 of the TFEU, the Comm ission may conduct investigations and take 
decisions either following receipt of a complaint or on its own initiative when it suspects there may have been a violation of the Treaty concerning co mpetition policy. The Court of Justice reviews the 
Commission’s activities and may rule against the Commission’s decisions. 
3.157.  The responsibility for public enforcement of  competition policy across the EU is shared by 
the Commission and the national competition authorities of the member States. The Commission 
cooperates with member States' national competition authorities through the European 
Competition Network (ECN), established to enhance the efficiency of policy application within the system of shared jurisdiction. Within the ECN,  the Commission and member States' competition 
authorities share information and attempt to agree on effective allocation of cases, which should 
be dealt with by a single competition authority as often as possible, either that of a member State 
or the Commission. Where an agreement or practice substantially affects competition in more than one member State, the Network members seek to ensure that the case is assigned to the 
authority which is well placed to deal with it. The Commission is particularly well placed if one or 
several agreement(s) or practice(s) have effect s on competition in more than three member 
States. 
3.158.  Subject to certain conditions, the parties can bring an action for annulment of Commission 
decisions before the General Court (on grounds of fact or law). Appeals on points of law only may be brought before the Court of Justice against judgements and orders of the General Court. 
3.3.2.2  Antitrust 
3.3.2.2.1  Anti-competitive agreements 
3.159.  Article 101 of the TFEU prohibits agr eements between undertakings that restrict 
competition, with the provision that this prohibition may be declared inapplicable for agreements 
that contribute to improving production or distribu tion of goods, or promote technical or economic 
progress while allowing consumers a fair share of the benefits. It does not apply to agreements of minor importance ( de minimis ) where the aggregate market share of the undertakings is small 
(less than 10% in cases of horizontal agreements, or 15% for vertical agreements). The 
Commission has also published guidelines on the applicability of Article 101 on horizontal cooperation agreements between actual or potential competitors, such as agreements on product standardization or joint R&D. Certain types of vertical agreements can improve economic efficiency 
within a production or distribution chain by facilitating better coordination between the 
participating undertakings, leading to a reduction in the transaction and distribution costs of the 
parties and to an optimization of their sales and investment levels. The Commission therefore 
adopted Regulation (EU) No. 330/2010 of 20 April 2010 on the application of Article 101(3) of the 
TFEU to categories of vertical agreements and co ncerted practices. The block exemption regulation 
(BER) contains certain requirements that must be fulfilled before a particular vertical agreement is 
exempt from the prohibition of Article 101(1) TF EU. The first requirement is that the agreement 
does not contain any of the hard core restrictions set out in the BER. The second requirement concerns a market share cap of 30% for both su ppliers and buyers. Thirdly, the BER contains 
conditions relating to three specific restrictions (non-compete obligations during the contract, non-
compete obligations after termination of the contract and the exclusion of specific brands in a 
selective distribution system). Furthermore, th rough Commission Regulation (EC) No. 316/2014 of WT/TPR/S/317 • European Union 
 
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  21 March 2014, the block exemption, from which certain kinds of licensing agreements for transfer 
of technology benefited, has been renewed for 12 years. Under this new Regulation, certain types 
of clause are no longer automatically exempted from antitrust rules but have to be assessed case-by-case. This is the case for clauses that allow the licensor to terminate a non-exclusive 
agreement if the licensee challenges the validity of the intellectual property rights, and clauses 
that force a licensee to license any improvements it makes to the licensed technology to the licensor on an exclusive basis. This regulation is complemented by Commission guidelines on the 
application of Article 101 of the TFEU to tec hnology transfer agreements. They provide new 
guidance on patent pools (the creation of, and licensing from, patent pools now benefits from a safe harbour in view of the often pro-competit ive nature of patent pools) and on settlement 
agreements (settlement agreements in the context of technology disputes are, as in many other 
areas of commercial disputes, in principle a legitimate way to find a mutually-acceptable 
compromise to a bona fide legal disagreement but their individual terms and conditions may be caught by Article 101(1)). 
3.160.  In the context of the current economic downturn, a number of undertakings in various 
industries cited the economic crisis and overcapacity problems as justifications for agreements that restrict competition, for example, by jointly reducing output. The Commission pointed out
151 that 
such crisis cartels, or industrial restructur ing agreements, despite their seeming remedy to 
overcome the effects of crisis, cannot be justified by economic downturns. It further stressed that not only are they in principle a restriction of competition under Article 101(1), but also are unlikely to be exempted under Article 101(3).
152 
3.161.  Since 2008, companies found to have participated in a cartel can settle their case by 
acknowledging their involvement in the cartel and having a reduced fine in return, and under certain stringent conditions, no fine at all. This so called "leniency policy" is considered by the 
competition authorities as a very efficient implementation tool to detect and dismantle cartels 
since the penalties for breaching competition law can be very severe (to date the largest fine imposed on a single company is over €896 million, and the largest fine imposed on all members of 
a single cartel is over €1.3 billion). 
3.162.  In order to obtain total immunity under the leniency policy, a company which participated 
in a cartel must be the first one to inform the Commission of an undetected cartel by providing sufficient information to allow the Commission to launch an inspection at the premises of the 
companies allegedly involved in the cartel. Compan ies that do not qualify for immunity may benefit 
from a reduction of fines if they provide evidence that represents "significant added value" to that 
already in the Commission’s possession and have terminated their participation in the cartel. 
Evidence is considered to be of a "significant added value" for the Commission when it reinforces 
its ability to prove the infringement. The first company to meet these conditions is granted a 30% to 50% reduction, the second 20% to 30% and subsequent companies up to 20%. The 
Commission also uses a "settlement" procedure to speed up the procedure for adoption of a cartel 
decision when the parties admit to the Commission's objections, and in return receive a 10% reduction in the fine. 
3.163.  The main recent regulatory development for leniency policy concerns the coordination with 
other competition authorities to which parallel leniency requests have been submitted. A leniency 
applicant must inform the Commission about any other applications it has filed or intends to file with other competition authorities. The purpose of this information is to enable the Commission to 
coordinate its investigation with other competition authorities. The Commission will only discuss 
information received under the Leniency Notice with other competition authorities pursuant to a confidentiality waiver provided by the leniency ap plicant. In order to facilitate the provision of 
waivers and to increase their uniformity worldwide, the International Competition Network (ICN) 
adopted Waiver Templates and an Explanatory Note in 2014. DG Competition has fully endorsed
153 
this guidance and accordingly requests that leniency applicants provide a full waiver of confidentiality using the ICN template. 
                                               
151 See for instance the speech by former Commissi oner responsible for Comp etition Policy before the 
International Bar Association Antitrust Conference/Madrid on 15 June 2002 "Higher Duty for Competition Enforcers". Viewed at: http://europa.eu/rapid/press-release_SPEECH-12-453_en.htm . 
152 OECD (2011c), Global Forum on Competition: Crisis Cartels, DAF/COMP/GF(2011)11, 18 October. 
Viewed at: http://www.oecd.org/daf/competition/cartelsandanticompetitiveagreements/48948847.pdf. 
153 See:  http://ec.europa.eu/competition/cartels/leniency/leniency.html . WT/TPR/S/317 • European Union 
 
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  3.164.  The overall trend is two applications for immunity and two applications for reduction of 
fines per month. Before the introduction of the first leniency programme in 1996, the Commission adopted 34 cartel decisions - that is on average one cartel decision per year. Since the entry into force of the 1996 Leniency Notice, the Commission adopted on average four to six cartel decisions 
per year, (out of which three to four were lenien cy generated), and one to two are ex-officio cases. 
Between 2010 and 2014, out of the 30 decisions th at have been adopted, 17 have been based on 
settlement procedures. 
3.165.  The number of cartel cases decided by the Commission during the period under review was 
five in 2012, four in 2013 and nine in 2014 involving respectively 37, 19 and 48 individual undertakings/associations. The global amount of the fines imposed annually was €1.875 billion in 2012, €1.882 billion in 2013 and €1.689 billion in 2014. The largest fines by cartel case were 
€1.470 billion in 2012 (TV and computer monitor tube cartel), €669 million in 2013 (yen interest 
rate derivative cartel), and €953 million in 2014 (automotive bearings cartel). The largest individual fines were €705 million in 2012 (Philips for the TV and computer monitor tubes cartel), 
€465 million in 2013 (Deutsche Bank AG for the eu ro interest rate derivative cartel) and 
€370 million in 2014 (Schaeffler for the automotive bearings cartel). 
3.166.  In 2013-14 the Commission applied the anti-cartels rules to a variety of sectors, notably to 
financial services (the Euribor, Tibor, Libor and Credit Defaults Swap cases), the automobile 
industry (the wire harnesses case), the electronic industry (the colour display tubes case, the colour pictures tubes case and the smart card chips case), the food industry (the North Sea shrimps traders case) and the electronic publishing sector (the e-book case). 
3.3.2.2.2  Abuse of dominant position 
3.167.  In order to establish whether a firm is abusing a dominant position pursuant to Article 102 
TFEU, the Commission must first assess dominance and therefore define the relevant market. The 
relevant market has two dimensions: the product market (all products/services which the 
consumer considers to be a substitute for each ot her due to their characteristics, their prices and 
their intended use), and the geographic market (area in which the conditions of competition for a 
given product are homogenous). In that context market shares are a useful first indication of the 
market power of each firm in comparison to the others. The Commission's view, as expressed in its 
Guidance Paper on its enforcement priorities concerning abusive exclusionary conduct by dominant undertakings
154, is that the higher the market share, and the longer the period of time over which 
it is held, the greater the probability that there is a preliminary indication of dominance. If a 
company has a market share of less than 40%, it is unlikely to be dominant. The assessment of dominance by the Commission takes factors into account other than just the market shares of a 
company, including: constraints imposed by existing supplies from actual competitors; constraints 
imposed by the credible threat of future expansion by actual competitors or entry by potential competitors (i.e. the ease with which other comp anies can enter the market and whether there are 
any barriers to this); the existence of countervailing buyer power (i.e. constraints imposed by the 
bargaining strength of the undertaking's customer s); the overall size and strength of the company 
and its resources; and the extent to which it is present at several levels of the supply chain (vertical integration). 
3.168.  Although a dominant company is as entitled to compete as any other company, it has a 
special responsibility to ensure that its cond uct does not distort competition. Examples of 
behaviour that may amount to abuse include: requiring that buyers purchase all units of a 
particular product only from the dominant company (exclusive purchasing); setting prices at a 
loss-making level (predation); refusing to supply input indispensable for competition in an ancillary market; tying; loyalty rebates; and charging excessive prices. 
3.169.  Between 2012 and 2015 the Commission ha s applied the rules on abuse of dominant 
position to traditional (e.g. energy) as well as non-traditional sectors (e.g. telecom, financial services, and digital technology), and has targeted a variety of regions, increasingly in the newer member States. Examples of such cases include: the Gazprom gas case, and the BEH, CEZ and 
OPCOM electricity cases (energy sector);
 the Multilateral Interchange Fees (MIF) cases on fees 
charged by credit card companies (financial se rvices); the ongoing Google case on web search, 
online search advertising and online search advertising intermediation and the Microsoft case on  
                                               
154 0JEU C 45/7, 24 February 2009. WT/TPR/S/317 • European Union 
 
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  the non-availability of a "choice screen" to se lect a browser (digital technology); the non-
competition agreement between Telefonica and Portugal Telecom case and the Slovak Telecom case (telecom sector); and the Standard Essential Patents (SEP) cases with Motorola and Samsung (telecom equipment sector).
155 
3.170.  One issue relating to the application of the rules on abuse of dominant position is anti-
competitive behaviour as it relates to intellectual property. The request for a preliminary ruling lodged by a German court in 2013 is interesting in this regard. The case centres around the 
conduct of standard-essential patent (SEP) holders who have given a commitment to grant 
licences to third parties on fair, reasonable and non-discriminatory (FRAND) terms. In an Opinion delivered on 20 November 2014 to the European Union Court of Justice, the Advocate General 
stated that the fact that a company owns a SEP does not necessarily mean that it holds a 
dominant position. He also proposed that the Court of Justice rule that, where the proprietor of an 
SEP has made a commitment to a standards body to grant third parties a licence on FRAND terms, it constitutes an abuse of a dominant position for that proprietor to request corrective measures or 
to seek an injunction against a company that ha s infringed the SEP, where it is shown that the 
SEP-holder has not honoured its commitment even though the offending company has shown itself to be objectively ready, willing and able to enter into such a licensing agreement.
156 
3.171.  Following the investigation, the Commission may issue a statement of objections (SO). 
This document informs the parties of the objections raised by the Commission and gives the companies the possibility to exercise their right of defence. If the Commission's concerns are not – or only partly – dispelled it drafts a decision prohibiting the identified infringement (according to 
Article 7 of the Antitrust Regulation). The draft is then submitted to the Advisory Committee 
composed of representatives of the member States ' competition authorities. If fines are proposed 
in the draft decision, the Advisory Committee meets a second time to specifically discuss them. 
The starting point for the fine is the percentage of the company's annual sales of the product 
concerned in the infringement (up to 30%). This is then multiplied by the number of years and months the infringement lasted. The fine can be increased (e.g. repeat offender) or decreased 
(e.g. limited involvement). The maximum level of fine is capped at 10% of the overall annual 
turnover of the company. Finally,  the draft decision is submitted to the College of Commissioners 
which adopts the decision. 
3.172.  Alternatively, the Commis sion may take a commitment decision. This is a quick way to 
restore effective competition to the market. Under commitment decisions, the Commission does 
not have to prove an infringement of the antitrust rules and imposes no fines. It voices its concerns and parties can come forward with commitments to address these concerns. If the 
Commission, after consulting market participants, finds these commitments sufficient, it takes a 
decision to make them legally binding. The commitments are usually valid for a specific period of time but if the companies breach them they may be fined. 
3.3.2.2.3  Application of antitrust rules to specific sectors 
3.173.  While the main principles of the EU treaties generally apply, a diminishing number of 
sectors are regulated separately in view of their specificities. During the period under review those sector-specific rules have been modified for agriculture and maritime transport. As far as 
agriculture is concerned, EU regulation 1308/2013 of 17 December 2013, taking into account the 
reform of the Common Agricultural Policy in 2013, modified the application of competition rules to the agricultural sector. It introduced new derogations based on efficiencies for joint negotiations 
through producer organizations in the olive oil, beef and veal and arable crops sectors, a new 
derogation for agreements in situations of extrem e crisis that have not been remedied by public 
intervention, and some specific derogations. With  regard to maritime transport, EU regulation 
697/2014 of 4 June 2014 prolongs the block exemptio n established by a previous regulation for six 
more years with unchanged conditions. 
                                               
155 In total between 2011 and 2014 the Commission closed 25 cases on abuse of dominant position 
including rejections and 16 cases excluding rejections. These figures are based on an individual cases count 
and may comprise cases where other articles of the treati es have been invoked; they should therefore be read 
with caution. 
156 CJUE, Case C-170/13 – Huawei Technologies v ZTE Corp., Opinion of the Advocate General delivered 
on 20 November 2014. WT/TPR/S/317 • European Union 
 
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  3.174.  Under Council Regulation (EC) No. 1/2003, when circumstances suggest that competition 
may be restricted or distorted in a certain sector, the Commission may conduct its inquiry into the particular sector and request information. In this context the Commission published in October 2014 the results of a study about the evolution of choice and innovation in food products 
in Europe during the last decade. According to the study the entry of new competitors always 
increases choice and innovation. In many member States, retail markets are not overly concentrated, and the retailers' bargaining power does not seem to have a negative impact on 
choice and innovation. Finally, while choice for European citizens has continuously increased in 
shops since 2004, the number of innovations reaching the consumer each year has decreased since 2008 – largely due to the economic crisis. 
3.175.  In December 2014, DG Competition published its fifth monitoring exercise on patent 
settlements in the pharmaceutical sector
157 which focused on patent settlements concluded 
between originator and generic companies in 2013 as such settlements may delay the market entry of cheaper generic medicines. According to the report, the number of settlements that may 
give rise to antitrust concerns has remained continuously low which demonstrates the industry's 
increased awareness of potentially problematic prac tices. The report also found that the overall 
number of patent settlements remained high compar ed to the previous monitoring periods, which 
indicates that companies can successfully settle their disputes within the boundaries of the EU 
antitrust rules. Between January and December 2013, 146 patent settlement agreements were concluded between originator and generic companie s, as compared to a total of 183 in 2012, and 
120 in 2011. 
3.176.  So far the Commission has closed three form al antitrust proceedings with respect to patent 
settlements. In June 2013 the Commission imposed a fine of €93.8 million on Danish pharmaceutical company Lundbeck and fines totalling €52.2 million on several producers of 
generic medicines for agreeing to delay the mark et entry of cheaper generic versions of the 
antidepressant citalopram.
158 For similar practices, the Commission also imposed fines on the U.S. 
pharmaceutical company Johnson & Johnson (J&J) and on Novartis of Switzerland (December 
2013)159 and on the French pharmaceutical company Servier and five producers of generic 
medicines - Niche/Unichem, Matrix, Teva, Krka and Lupin – (July 2014).160  
3.3.2.2.4  Private enforcement 3.177.   Following a Commission proposal of June 2013, Directive 2014/104/EU on antitrust 
damages actions was adopted by the Council on 10 November 2014 and signed into law on 
26 November 2014. The Directive sets out a number of measures to facilitate damages actions. In particular national courts will have the power to order companies to disclose evidence when 
victims claim compensation. Decisions of national competition authorities finding an infringement 
will automatically constitute proof before national courts of all member States that the infringement occurred. Rules on limitation periods (i.e. the period of time within which victims can 
bring an action for damages) will be clarified and so will the liability rules in cases where price 
increases due to an infringement are "passed on" along the distribution or supply chain. 
3.3.2.2.5  Selected decisions of  national competition agencies 
3.178.  A large proportion of antitrust cases within the European Competition Network are 
investigated by national competition agencies (NCA). Thus, in 2013, out of the 121 case 
investigations of which the ECN was in formed, 116 were carried out by an NCA.
161 
3.179.  For example, on 27 February 2014, the Italian competition authority fined Roche and 
Novartis over €180 million for cartelizing the sales of two major ophthalmic drugs. The companies 
were found to have colluded to exclude the cheaper medicine (Avastin), used in the treatment of 
                                               
157 Commission (2014), 5th Report on the Monitoring of Patent Settlements (period: January-December 
2013),  5 December 2014. Viewed at: 
http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/patent_settlements_report5_en.pdf . 
158 European Commission, Case AT.39226, 19 June 2013. 
159 European Commission, Case AT.39685, 10 December 2013. 
160 European Commission, Case AT.39612, 9 July 2014. 
161 For further details on decisions of NCAs, see: 
http://ec.europa.eu/competition/ec n/competitionauthorities.html. WT/TPR/S/317 • European Union 
 
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  the most common eyesight condition in the elderly as well as other serious sight problems, and 
channelling demand towards the more expensive drug (Lucentis), through an artificial distinction between the two products. The anti-competitive agreement was found to cause the Italian National Health Service to sustain additional expenses estimated at over €45 million in 2012. 
3.180.  The French competition agency has also investigated practices aimed at delaying the 
development of cheaper medicines. For example, on  14 May 2013, it fined Sanofi-Aventis a total of 
€40.6 million for implementing a denigration strategy. This strategy was aimed at limiting entry 
into the market of generic versions of Plavix in favour of Sanofi-Aventis' products, i.e. the 
originator Plavix medicine and its generic version marketed by Sanofi-Aventis, Clopidogrel Winthrop. The company was found to have implemented a global and structured communication strategy, aimed at stopping the generic substitution process at two key stages: at the prescription 
stage, by convincing doctors to insert the indicati on “non-substitutable” to the prescriptions, so as 
to limit the substitution of Plavix by a generic medicine; and at the substitution stage itself, by encouraging pharmacists to substitute Plavix by Clopidogrel Winthrop, to the detriment of other 
generic competitors.
162 
3.3.2.3  Mergers and acquisitions 3.181.  The EU Merger Regulation (EC)139/2004 re quires examination of whether a concentration 
would significantly impede effective competition, notably through the creation or strengthening of 
a dominant position. In such cases, the concentration may be prohibited or conditionally approved. Therefore, all concentrations with a "Communi ty dimension" are subject to review by the 
Commission before being approved. A merger with  a "Community dimension" is defined as a 
merger where the parties have a combined worldwide turnover of €5 billion and each party has a 
Community-wide turnover of €250 million. In accordan ce with the stand-still obligation, no merger 
with a Community dimension may proceed unless approved by the Commission. Most mergers are 
approved within the initial (first phase) period, without the need for an in-depth (second phase) 
investigation. In 2012, 263 out of 283 merger notifications were cleared in the first phase (Table 3.13) 
Table 3.13 Approved and prohibited mergers, 2013 and 2014 
 2013 2014 
Mergers approved in 1st phase 252 280 
Mergers approved after 2nd-phase investigation 4 7 
Prohibited mergers 2 0 
Total of merger notifications 277 303 
Source: Information provided by the authorities. 
3.182.  On 1 January 2014, the merger simplification package entered into force.163 It simplifies 
certain procedures for notifying mergers under the EU Merger Regulation notably by updating the 
notice on a simplified procedure for treatment of certain mergers. Under this notice, companies 
can use a shorter notification form for certain categories of mergers that are generally unlikely to 
raise competition problems. The market share threshold for treatment under the simplified procedure for mergers between firms competing in the same market has been raised from 15% to 
20%. For mergers between firms active in upstream and downstream markets - such as between a 
producer of car parts and a car manufacturer - the threshold has been raised from 25% to 30%. The Commission also wants to make it possible to treat a case as simplified where the combined 
market share of two firms active in the same ma rket is above the 20% threshold but the increase 
in market share resulting from the merger is very small. The changes allow up to 70% of all notified mergers to qualify for review under the Commission's simplified procedure, i.e. about 10% more than before the reform. This could result in savings for the merging companies concerned, 
cutting lawyers' fees by up to one-half and redu cing preparatory in-house work. In addition, the 
Commission reduced the net amount of inform ation required to notify all mergers. 
                                               
162 French Competition Authority, Decision, 14 May 2013. 
163 This package, announced on 5 December 2013, is  composed of a revised implementing regulation, 
Regulation (EU) 1269/2013 of 5 December 2013) and the Commission Notice of 5 December 2013 on a simplified procedure for treatment of certain concen trations under Council Regulation (EC) No 139/2004. WT/TPR/S/317 • European Union 
 
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  3.183.  Following a public consultation launched in June 2013, in July 2014 the Commission issued 
a white paper entitled "Towards more effective merger control"164 on possible future improvements 
of the EU Merger Regulation in two areas: minority  shareholdings - also called structural links; and 
the transfer of cases between the Commission and national competition authorities. The current 
Merger Regulation applies only to transactions leading to an acquisition of control over a company. 
The white paper elaborates on whether the Merger  Regulation should be amended to allow the 
Commission to look also at non-controlling minority shareholdings because experience shows that, 
in some specific instances, the acquisition of a non-controlling minority stake can harm 
competition and consumers. For example, if in a concentrated market one firm acquires a 20% stake in a competitor, it may influence the latter’s competitive conduct even without gaining control, for example through having a seat on the board, or it may have fewer incentives to 
compete because it shares the target’s profits. A minority stake owned by a firm in a company that 
supplies an important input to the acquirer’s competitors may also lead to supply problems for those competitors. 
3.184.  The Commission proposes to use a "targete d transparency system". Under this system an 
undertaking would be required to submit an information notice to the Commission if it is considering the acquisition of a minority shareholding that qualifies as a "competitively significant 
link". The Commission would decide whether further investigation of the transaction is warranted 
and member States would consider whether to request a referral on the basis of this information notice. The parties would only be required to submit a full notification if the Commission decided to initiate an investigation and the Commission would only issue a decision if it had initiated an 
investigation. In order to provide parties with legal certainty, they should be able to voluntarily 
submit a full notification. The Commission believes  that such a system would allow potentially 
problematic transactions to be targeted from the outset, namely through the identification of 
transactions which create a "competitively significant link", and it would ensure that the 
transactions thus identified could be effectively controlled by the Commission, even without the need for a full notification obligation. Any agr eements entered into between the acquirer of the 
minority shareholding and the company partially acquired remain subject to assessment under 
Articles 101 and 102 TFEU unless they constitute "ancillary restraints", i.e. restrictions directly related and necessary to the implementation of the acquisition. 
3.185.  Regarding case referrals between the Commission and national authorities, the Merger 
R e g u l a t i o n  a l l o w s  c a s e s  t o  b e  r e f e r r e d  f r o m  m e m b e r  S t a t e s  t o  t h e  C o m m i s s i o n  o r  v i c e  v e r s a ,  
provided none of the authorities involved objects to the referral. The white paper suggests ways to streamline this system to avoid any delays and further improve its effectiveness. For instance one 
or more member State(s) that are competent to review a transaction under their national law 
could request a referral to the Commission within 15 working days from the date the transaction was notified or made known to them. The Commission would then be able to decide whether or 
not to accept the referral, and, if so, would then have competence for the whole EEA. However if 
one or more competent Member State(s) opposed the referral, the Commission would renounce jurisdiction for the whole EEA and the Member Stat e(s) would retain their jurisdiction. The Member 
State(s) would not have to give reason for opposing the referral. 
3.3.2.4  International cooperation 
3.186.  As companies increasingly engage in cross-border deals affecting several countries, the EU 
cooperates with competition authorities outside its jurisdiction. The EU's competition agreements 
and the cooperation arrangements with the United States (1995, 1998 and 2011), Canada (1999), 
Japan (2003), and the Republic of Korea (2009) enable the parties to share mainly non-confidential information. The Agreement with Swit zerland that was signed in 2012 and entered in 
force on 1 December 2014, goes beyond previous cooperation with other jurisdictions, since it 
allows a broader scope of information exchange, even without the consent of the companies involved. In addition to the agreements mentioned above, the EU has concluded bilateral agreements and/or memoranda of understanding specifically dedicated to competition issues (so 
called "dedicated agreements") with Brazil (2009), China (2012), India (2013) and the Russian 
Federation (2011). 
                                               
164 European Commission (2014), White Paper – Towards more effective EU  merger control, 
COM(2014)449 final, 9 July. Viewed at: http://ec.europa.eu/competition/consultations/2014_merger_ control/ 
mergers_white_paper_en.pdf . WT/TPR/S/317 • European Union 
 
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  3.187.  Competition provisions have also been included in numerous general cooperation or 
association agreements or trade agreements. That is the case of agreements with: Albania; Algeria; Armenia; Azerbaijan; CARICOM; Bosnia and Herzegovina; Canada; Central America; Chile; Colombia and Peru; Egypt; the Faroe Islands; FYROM; Georgia; Iceland; Liechtenstein; 
Norway; Israel; Jordan; the Republic of Korea; Lebanon; Mexico; Moldova; Montenegro; Morocco; 
the Russian Federation; Serbia; South Africa; Singapore; Tunisia; and Turkey. 
3.188.  The EU has also been supportive of greater multilateral cooperation through the 
International Competition Network (ICN), the UN CTAD Intergovernmental Group of Experts on 
Competition Policy, and the OECD Competition Committee. The EU considers that these multilateral fora provide an important platform to promote open competition and fight protectionism; this enables competition authorities worldwide to respond to cases more efficiently 
through coordinated inspections across several jurisdictions. 
3.3.3  Taxation 3.189.  In the EU, customs duties and other meas ures directly related to trade are harmonized 
(Section 3.1)
165 and there is a common system for value-added-tax. However, direct taxes are not 
harmonized at the EU level and member States are free to choose the tax systems most appropriate to their situations. The main priority, at the EU level, has been to eliminate tax 
obstacles to all forms of cross-border economic ac tivity and continue efforts to prevent harmful tax 
competition.
166 Furthermore, the Commission has proposed a directive which would allow 
companies operating cross-border in the EU to comply with a single Common Consolidated Corporate Tax Base. This directive is currently under discussion with the member States in the 
Council.
167 
3.190.  For the EU-28 in 2012, total tax receipts and social contributions were the equivalent of 
around 39.6% of GDP, or €5,140 billion. Income taxes (i.e. taxes on individual or household 
income) were the most important, followed by em ployers' social contributions, and VAT (Table 
3.14). 
Table 3.14 Tax and social contributions in the EU-28, 2007-12 
(€ billion) 
 2007 2008 2009 2010 2011 2012 
Total tax receipts 3,397 3,360 3,029 3,182 3,337 3,470 
Value added type taxes (VAT) 879 868 789 867 909 927 
Excise duties and consumption taxes 300 295 287 299 307 316 
Taxes on land, buildings and other structures 1278 124 126 124 132 152 
Taxes on individual or household income 
including holding gains 1,163 1,178 1,100 1,117 1,158 1,223 
Taxes on the income or profits of corporations 
including holding gains 414 379 260 291 317 322 
Actual social contributions 1,549 1,593 1,546 1,588 1,638 1,685 
Employers' actual social contributions 894 917 885 912 937 960 
Employees' social contributions 473 484 463 476 499 518 
Social contributions by self- and non-employed 
persons 182 192 198 200 202 206 
Source: Eurostat online  database. Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui /show.do?dataset=gov_a_tax_ag&lang=en  
[February 2015]. 
3.191.  Taxes and social contributions among the member States vary considerably in economic 
importance (total tax receipts and social contributions are the equivalent of 27% of GDP in Lithuania and 48% in Denmark) and structure (in Denmark income tax accounts for about half of 
                                               
165 Directive 2006/112/EC, Council Implementing Regulation (EU) No. 282/2011. 
166 DG Taxation and Customs Union online information. Viewed at: 
http://ec.europa.eu/taxation_customs/taxation/gen_info/tax_policy/index_en.htm  [December 2014]. 
167 EU Commission, (2011), Proposal for a Council Directive on a Common Consolidated Tax Base 
(CCCTB) , COM(2011) 121/4 2011/0058 (CNS). For more information see 
http://ec.europa.eu/taxation_customs/taxation/company_tax/common_tax_base/index_en.htm  [February 
2015]. WT/TPR/S/317 • European Union 
 
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  total tax and social contribution and in Estonia employers' social contributions account for about 
one-third) (Table 3.15). 
3.3.3.1  Income tax 3.192.  The systems of income tax vary from one member State to another with different 
categories of income subject to income tax, different rates of tax and different treatment of 
expenses that may be deducted from gross income. In addition, local taxes on income may also apply, and can represent a considerable part of the charge on income: in Denmark the average 
local tax is higher than the highest rate of income tax (Table 3.15). 
Table 3.15 Income tax and employee social contributions in the EU 
 (% of GDP for 2012, tax rates 2014) 
Member 
State Income 
tax1 Employee 
social 
contribu-
tions1 Tax 
system2,3,4 Top rate 
of income 
tax2,3,4 Income for 
maximum 
income tax 
(single 
person)2,3,4 Note2,3,4 
 % GDP  % GDP  %
Belgium 12.7 4.4 Progressive 
5 brackets 53.7 €36,300 • 25% withholding tax on interest 
income 
• Municipal surcharge average 7.4% 
Bulgaria 2.9 2.4 Flat rate 10.0  • Most interest income exempt 
Czech Rep. 3.8 3.2 Flat rate 22.0  • Surcharge of 7% on income over 
CZK1,245,216 (€46,119) 
• Spending allowance of up to 
CZK800,000 or 600,000 for rental income 
Denmark 24.5 0.9 Hybrid 
system 55.6 DKK449,100 
(€46,443) • Local income taxes average 25.6% 
• Health tax of 5% 
Germany  8.8 6.4 Progressive 
3 brackets 47.5 €250,000 • 2nd bracket rate is 42% for income ove r
€52,881 
• Solidarity surcharge of 5.5% 
Estonia 5.3 0.8 Flat rate 21.0   
Ireland 9.7 1.1 Progressive 
2 brackets 48.0 €32,800 • Levy of up to 7% on income over 
€16,016 
• Deposit interest tax of 41% 
Greece 7.0 4.6 Progressive 
3 brackets 46.0 €42,000 • Tax credits €100 per €1,000 of income 
up to €42,000 
• Additional tax on: dividends 10%; 
interest 15%; royalties 20% 
• Interest on Greek Government bonds 
and treasury bills exempt 
Spain 7.7 1.7 Progressive 
7 brackets 52.0 €300,000  
France 8.5 4.2 Progressive 
5 brackets 50.3 €150,000 • Tax on real estate gains of 19% 
Croatia 3.7 5.3 Progressive 
3 brackets 47.2 HRK105,600 
(€13,834) 
 • Exemption for interests on savings, on 
deposits and on securities under 
certain conditions, and capital gains on movable property 
Italy 12.2 2.4 Progressive 
5 brackets 47.9 €75,000 • Regional surcharge of 1.23-1.73%, 
municipalities surcharge of 0.9%, 
additional surcharge of 3% on income 
over €300,000 
Cyprus 4.0 2.5 Progressive 
4 brackets 35.0 €60,000 • Temporary special contribution (shared 
with employers) at progressive rates 
up to 3.5% on income over €4,500 
• Exemption for some capital gains and 
interest income 
Latvia 5.7 2.6 Flat rate 24.0  • Capital gains tax of 15% 
• Income from dividends, interest, 
insurance funds, and other capital 
investments 10% 
Lithuania 3.5 2.2 Flat rate 15.0  • Progressive basic allowance from 
LTL6,840 (€1,975) for incomes of 
LTL12,000 (€3,464) or less falling to zero for incomes of LTL38,304 (€11,058) WT/TPR/S/317 • European Union 
 
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  Member 
State Income 
tax1 Employee 
social 
contribu-
tions1 Tax 
system2,3,4 Top rate 
of income 
tax2,3,4 Income for 
maximum 
income tax 
(single 
person)2,3,4 Note2,3,4 
 % GDP  % GDP  %
Luxembourg 8.6 5.2 Progressive 
18 brackets 43.6 €100,000 • Employment fund surcharge of up to 
7% 
• Withholding tax on interest 10% 
• Withholding tax on dividends of 15% 
Hungary 5.4 5.1 Flat rate 16.0  • Income includes sale of real estate, 
dividends, and interest 
Malta 6.7 2.7 Progressive 
4 brackets 35.0 €60,000  
Netherlands 7.7 7.0 Progressive 
4 brackets 52.0 €56,531 • Privately held assets deemed income 
4% of net value taxed at 30% for 
deemed income over €21,139 
• Capital gains tax 22%-25% 
Austria 10.1 6.1 Progressive 
3 brackets 50.0 €60,000 • Withholding tax of 25% on capital 
gains of financial assets, interest 
income, dividends, immovable 
property 
Poland 4.6 4.9 Progressive 
2 brackets 32.0 PLN85,528 
(€20,374) • Withholding tax of 19% on dividends 
and interest 
Portugal 5.9 3.6 Progressive 
5 brackets 56.5 €80,000 • Surcharge of 3.5% 
• Solidarity surcharge at 2.5% for 
income €80,000-250,000 and 5% on 
income over €250,000 
Romania 3.5 2.9 Flat rate 16.0  • Income includes salaries, independent 
activities, lease operations, dividends, 
interest, transfer of securities, pensions, liquidation of a legal person,
prizes, etc 
Slovenia 5.8 7.7 Progressive 
4 brackets 50.0 €70,907.20 • 25% on interest income, dividends, 
property rents, capital gains 
Slovakia 2.6 3.0 Progressive 
2 brackets 25.0 €35,022.31 • Withholding tax of 19% on income 
from investments, interest, pension 
insurance 
Finland 13.0 3.1 Progressive 
5 brackets 51.5 €100,000 • Municipal income tax (flat rate) 
average 19.74% 
• Church tax 1-2% 
• Income from dividends, rent, interest, 
capital gains, timber sales, 30% up to 
€40,000, 32% over €40,000 
Sweden 15.2 0.1 Progressive 
2 brackets 56.9 SEK602,600 
(€69,949) • Municipal income tax average 31.73% 
U.K. 9.7 3.2 Progressive 
3 brackets 45.0 £150,000 
(€176,580) • 2nd bracket rate is 40% for income of 
£31,866-150,000 
• Capital gains tax 18% up to £32,010, 
28% over £32,010 
Source: 1. Eurostat online database [gov_a_tax_ag]. Viewed at:  
http://appsso.eurostat.ec.europa.eu/nui /show.do?dataset=gov_a_tax_ag&lang=en  
[February 2015]; 
 2. Eurostat (2014), Taxation trends in the European Unio n - Data for the EU  Member States, 
Iceland and Norway , Edition 2014; 
 3. EU online information, Your Europe, Income taxes abroad . Viewed at: 
http://europa.eu/youreurope/citizens/work/taxes/income-taxes-abroad/index_en.htm  
[February 2015]; and  
 4. Member States' official tax sites. 
3.3.3.2  Corporation tax 
3.193.  Corporation tax rates vary from 10% in Bu lgaria to 35% in Malta. However, as in many 
other jurisdictions, differences in calculating allowable expenses, depreciation allowances, and other factors can mean that the effective tax on prof its may be different to the nominal rate of tax. 
In addition to corporation tax, employers usually make significant social contributions which, for 
most member States, are greater than their corporation tax payments. Therefore, a decision to invest in a member State in a labour-intensive enterprise could be influenced more by the expected employer social contribution  than the rate of corporation tax. WT/TPR/S/317 • European Union 
 
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  3.194.  The World Bank/PwC report on paying taxes defines taxes broadly to include all mandatory 
contributions to government and local authorities,  and applies them to a standardized corporation 
for comparison among different countries. The repo rt shows a considerable difference between the 
nominal rate and the actual deductions from profits – and that, for most member States, the 
charges related to labour are more important than taxes on profits (Table 3.16).168 
Table 3.16 Corporation tax and employer social contributions 
(% of GDP for 2012, tax rates 2014) 
Member 
State Corporation 
tax1 Employer 
social 
contributions1 Nominal rate2,3 Profit tax4 Labour taxes4 Other4 
 % GDP % GDP % % % %
Belgium 3.1 8.9 33.99 6.5 50.7 0.6 
Bulgaria 1.9 4.2 10 6.0 20.2 1.8 
Czech Rep 3.3 9.9 19 7.6 38.4 2.5 
Denmark 3.0 0.1 24.5 20.3 3.0 2.7 
Germany  2.7 6.8 30 23.3 21.2 4.3 
Estonia 1.4 10.6 21 8.4 39.3 1.9 
Ireland 2.4 3.1 12.5 12.4 12.1 1.4 
Greece 1.1 4.8 26 18.2 31.0 0.7 
Spain 2.2 8.4 30 21.9 35.7 0.6 
France 2.3 11.6 33.33/36.6 7.4 51.7 7.5 
Croatia 2.0 6.0 20 0.0 17.1 1.7 
Italy 2.3 9.3 27.55 19.9 43.4 2.1 
Cyprus 6.3 6.2 12.5 9.6 12.0 1.6 
Latvia 1.6 5.8 15 4.9 27.2 2.9 
Lithuania 1.3 7.3 15 6.1 35.2 1.3 
Luxembourg 5.3 4.9 21 4.2 15.6 0.4 
Hungary 1.3 7.7 19 11.8 34.3 1.9 
Malta 6.3 2.8 35 30.3 10.7 0.6 
Netherlands 2.1 5.4 25 21.1 17.6 0.3 
Austria 2.4 7.0 25 15.4 34.3 2.3 
Poland 2.1 4.9 19 13.1 24.7 0.9 
Portugal 2.8 5.1 23 15.1 26.8 0.5 
Romania 2.2 5.7 16 10.7 31.5 1.0 
Slovenia 1.3 5.8 17 12.5 18.2 1.3 
Slovakia 2.4 6.8 22 8.5 39.7 0.4 
Finland 2.2 9.2 20 14.5 24.2 1.3 
Sweden 2.7 7.3 22 13.4 35.5 0.5 
U.K. 2.9 4.5 21 20.9 11.3 1.5 
Source: 1. Eurostat online database [gov_a_tax_ag]. Viewed at:  
http://appsso.eurostat.ec.europa.eu/nui /show.do?dataset=gov_a_tax_ag&lang=en  [February 
2015]. 
 2. Eurostat (2014), Taxation trends in the European Unio n - Data for the EU  Member States, 
Iceland and Norway , Edition 2014. 
 3. Member States' official tax sites, and  4. World Bank/PwC (2014), Paying Taxes 2015 , p. 144. 
3.195.  In addition to the taxes and social contribu tions paid to the state or local authorities, the 
cost to a corporation also depends on the time required to comply with tax payments which also 
varies from one Member state to another from as low as 55 hours in Luxembourg to 454 hours in 
Bulgaria.169 
3.3.3.3  Value added tax 
3.196.  The VAT Directive (Council Directive 2006/112/EC) sets out a common system for VAT in 
the EU. The VAT Directive has been amended severa l times, including in July 2013 when, following 
                                               
168 World Bank/PwC (2014), Paying Taxes 2015, pp. 121-124. 
169 World Bank/PwC (2014), Paying Taxes 2015, p. 145. WT/TPR/S/317 • European Union 
 
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  a Communication from the Commission on the future of VAT170, the Council adopted two directives 
to address fraud.171 
3.197.  In principle, supplies of goods and services are subject to a standard rate of at least 15% 
but Member states may apply reduced rates of at least 5% on goods and services listed in 
Annex III to the VAT Directive.172 They are also required to exempt from VAT activities listed in 
Article 132-137 of the VAT Directive (principally activities in the public interest (e.g. postal services, hospital and medical care, and children's education) as well as some financial 
transactions). As noted by the Commission "the se simple rules are however complicated by a 
multitude of derogations granted to certain member States, in some instances a majority of member States. These derogations were granted during the negotiations preceding the adoption of the VAT Rates Directive of 1992 and in the Acts of Accession to the European Union. Overall, such 
derogations prevent a coherent system of VAT rates in the EU from being applied."
173 
3.198.   Reflecting the differences among the member States in the product coverage and rates of 
VAT, the importance of VAT to Government revenues varies substantially from one member State 
to another, from 12.4% of GDP in Cr oatia to 5.5% in Spain (Table 3.17). 
Table 3.17 VAT in the EU 
(% of GDP for 2012, tax rates 2014) 
Member State VAT1 Standard rate2 Reduced 
rate(s)/parking 
rate2 Zero rated2 
 % GDP % %  
Belgium 7.2 21 6/12 Yes 
Bulgaria 9.4 20 9 - 
Czech Rep 7.2 21 15 - 
Denmark 10.0 25 - Yes 
Germany 7.3 19 7 - 
Estonia 8.7 20 9 - 
Ireland 6.2 23 4.8/9/13.5 Yes 
Greece 7.1 23 6.5/13 Yes 
Spain 5.5 21 4/10 - 
France 7.0 20 2.1/5.5/10 - 
Croatia 12.4 25 5/13 - 
Italy 6.1 22 4/10 Yes 
Cyprus 8.9 19 5/9 - 
Latvia 7.1 21 12 - 
Lithuania 7.7 21 5/9 - 
Luxembourg 7.1 15 3/6 - 
Hungary 9.4 27 5/18 - 
Malta 7.8 18 5/7 Yes 
Netherlands 7.0 21 6 - 
Austria 8.0 20 10 - 
Poland 7.3 23 5/8 - 
Portugal 8.5 23 6/13 - 
Romania 8.5 24 5/9 - 
Slovenia 8.2 22 9.5 - 
Slovakia 6.1 20 10 - 
Finland 9.2 24 10/14 Yes 
Sweden 9.3 25 6 Yes 
                                               
170 COM (2011)851. 
171 Council Directives 2013/42/EU and 2013/43/EU. 
172 Subject to certain conditions an d procedures, member States may al so apply a reduced rate to the 
supply of natural gas, electricity an d district heating. By way of a dero gation from the norm al rules, certain 
member States have been authorized to maintain reduced rates, including those lower than the minimum or zero rates, in certain areas. These derogations were gr anted during the negotiations  preceding the adoption of 
the VAT Rates Directive of 1992 or the Acts of Accession to the EU. Most of them apply until adoption of a definitive VAT system. The main objective of these deroga tions is to ensure the gradual transition towards the 
application of uniform rules. 
173 Commission online information. Viewed at: 
http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/rates/index_en.htm  [February 2015]. WT/TPR/S/317 • European Union 
 
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  Member State VAT1 Standard rate2 Reduced 
rate(s)/parking 
rate2 Zero rated2 
 % GDP % %  
U.K. 7.3 20 5/17.5 Yes 
Source: 1. Eurostat online database [gov_a_tax_ag]. Viewed at: 
http://appsso.eurostat.ec.europa.eu/nui /show.do?dataset=gov_a_tax_ag&lang=en  
[February 2015]; 
 2. Eurostat and European Commission (2014), VAT Rates Applied in the Member States of the 
European Union , taxud.c.1(2014)2276174-EN. 
3.199.  Provided conditions are met (mainly proof of export/supply in another member State), VAT 
on exports outside the EU and on sales to anothe r EU member State are zero-rated, while imports 
are charged VAT at the point of entry into the EU or on acquisition of the goods for goods from 
another EU member State. 
3.200.  As noted in the last Review, the application of different VAT rates for different goods and 
services adds to compliance costs although reduced rates, zero-rating, and exemptions can translate into significant subsidies. Furthermore, a simplified system which applied a single VAT 
rate at, or possibly even below the minimum stan dard rate of 15%, if applied to all goods and 
services, could result in no reduction in revenue while simplifying compliance costs and reducing economic distortions among sectors.
174 
3.3.3.4  Excise duties 
3.201.  All member States apply excise duties on alcoholic beverages, manufactured tobacco 
products, and energy products. Council Directive 2008/118/EC established the general 
arrangements for excise duties on these products while other directives set out minimum rates 
that may be applied.175 
3.202.  The structure of excise duties and the rates applied vary from one member State to 
another and are regularly published by the Commission176 while the economic importance of excise 
duties varies from as low as 0.2% of GDP in Luxembourg to as high as 5.1% in Bulgaria. 
3.3.3.5  Vehicle tax 3.203.  To date the European Union has not harm onized the vehicle tax regime, however EU law 
restricts member States' flexibility in applying co nsumption tax to vehicles. As such, each member 
State applies its own national transportation taxes, mainly through registration taxes levied on the car purchase, and circulation taxes – levied annually on car ownership. On cars, 19 member States 
apply registration tax and 21 apply circulation tax. In recent years such tax rates have been more 
commonly linked to the car's CO
2 emissions, utilization of alternative energy fuels and other 
features promoting environmentally-friendly vehicles. Estonia, Slovakia, the Czech Republic, and Lithuania do not apply vehicle tax on passenger cars. Among the member States, total revenue 
from vehicle taxation, as a percentage of GDP, ranged between 0.01% and 0.13% in 2012, 
averaging at around 0.05% in the EU.
177 
3.3.4  State enterprises178 
3.204.  As in other countries, there are some enterprises in the member States of the EU which 
are wholly- or partly-owned and/or controlled by a member State or other public authority or which have been granted some right or privil ege and which provide goods or services to 
                                               
174 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, Section 3.1.5. 
175 Council Directive 92/83/EEC, Council Directive 92/84/EEC, Commission Regulation (EC) No. 3199/93, 
Council Directive 95/59/EC, Council Directive 92/79/EEC, Council Directive 92/80/EEC, and Council Directive 2003/96/EC. 
176 See Commission (2014), Excise Duty Tables , Ref 1041, July. Viewed at: 
http://ec.europa.eu/taxation_customs/taxation/excise_duties/index_en.htm  [December 2014]. 
177 Taxation Paper No. 48 from DG Taxation and Cust oms Union, 2014 and Eurostat, taxation trends in 
the European Union - Data for the EU member States, Iceland and Norway, Edition 2014. 
178 State enterprises are not necessarily state-trading enterprises in the sense of Article XVII of GATT 
1994 or the Understanding on the Interpretation of Article XVII. WT/TPR/S/317 • European Union 
 
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  businesses or the public which could be provided  by the private sector but, for a variety of 
reasons, the private sector many not offer adequa te coverage or may not be involved at all. 
3.205.  Under Article XVII.4(A) of GATT 1994 and paragraph 1 of the Understanding on the 
Interpretation of Article XVII, the EU has notified  a state trading enterprise to the Working Party 
on State Trading Enterprises: Systembologet AB of Sweden, which is a retail monopoly for sales of 
alcoholic beverages to the general public in Sweden.179 
3.206.  In a 2014 report by the OECD, a state-owned enterprise was defined as an autonomous 
public entity involved in commercial activities and controlled, directly or indirectly, by central 
Government. Based on this definition, at end-2012,  the member States of the EU covered by the 
report180 had 1,652 majority-owned enterprises and statutory corporations, employing over 
4 million people and valued at US$847 billion. In addition, there were 74 publicly-listed enterprises 
in which the central Government had holdings of between 10 and 50% that employed 2.3 million 
people and had a total market value of US$648 billion (Table 3.18). 
Table 3.18 State-owned enterprises in  selected member States end-2012180  
 
Total 
Primary 
sectors 
Manufacturing 
Finance 
Telecoms 
Electricity  
and gas 
Transport 
Other utilities 
Real estate 
Other 
activities 
Majority-owned listed entities  
No.  38 5 5 4 2 11 8 2 1 -
Employed '000 764 115 121 164 21 297 42 3 2 -
Market 
Value US$bn 351 104 10 59 10 151 11 1 4 -
Minority-owned listed entities  
No.  74 4 23 19 8 7 8 1 - 4
Employed '000 2,256 52 552 296 483 288 566 - - 18
Market 
Value US$bn 648 30 108 270 140 66 32 - - 2
Majority-owned non-listed entities  
No.  1,344 125 133 85 8 77 188 145 82 501
Employed '000 1,885 34 78 83 4 122 792 240 5 528
Value US$bn 441 15 13 94 1 97 122 14 15 70
Statutory corporations  
No.  270 59 21 9 1 7 45 15 6 107
Employed '000 1,576 16 4 1 - 3 927 178 4 442
Value US$bn 54 9 - - - 3 15 - 4 24
Note: - means zero. 
Source: OECD (2014), The Size and Sectoral Distribution of SOEs in OECD and Partner Countries, OECD 
Publishing. http://dx.doi.org/10.1787/9789264215610-en  [December 2014]. 
3.207.  The European Union does not have a legal definition of a "state-owned enterprise", but 
several articles of the TFEU refer to "public undertakings." The Treaty is neutral on the issue of 
ownership, including ownership of public undertaki ngs: Article 345 states that the EU Treaties "in 
no way prejudice the rules in member States gove rning the system of property ownership". Article 
106 of the TFEU also states that "in the case of  public undertakings and undertakings to which 
member States grant special or exclusive rights, member States shall neither enact nor maintain 
in force any measures contrary to the rules contained in the Treaties, in particular to those rules provided for in Article 18 and Articles 101 to 109" . (where Article 18 is on non-discrimination, and 
Articles 101 to 109 are on competition policy). Article 106 assigns to the Commission the 
responsibility for ensuring its application. The TFEU also includes several provisions providing limited exemptions to the general rules for public  and private undertakings operating services of 
                                               
179 WTO document G/STR/N/15/EU of 30 June 2014. 
180 Austria, Belgium, Czech Republic , Denmark, Estonia, Finland, Fr ance, Germany, Greece, Hungary, 
Ireland, Italy, Latvia, Lithuania, the Netherlands,  Poland, Portugal, Slovenia, Spain, Sweden, and the 
United Kingdom but excludin g Luxembourg and Slovakia. WT/TPR/S/317 • European Union 
 
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  general economic interest (e.g. water, energy, transport, and telecommunications) and for 
revenue producing monopolies. 
3.208.  Commission Directive 2006/111/EC on the transparency of financial relations between 
member States and public undertakings, defines a ''public undertaking'' as "any undertaking over 
which the public authorities may exercise directly or indirectly a dominant influence by virtue of 
their ownership of it, their financial participation therein, or the rules which govern it. A dominant influence on the part of the public authorities shall be presumed when these authorities, directly or 
indirectly, in relation to an undertaking: (a) hold the major part of the undertaking's subscribed 
capital; or (b) control the majority of the votes attaching to shares issued by the undertaking; or 
(c) can appoint more than half of the members of the undertaking's administrative, managerial or supervisory body." 
3.209.  Under the Directive, member States are required to report to the Commission financial 
relations between public authorities and public undertakings for those public undertakings with 
turnover of more than €40 million (or balance sheet total of €800 million for public credit 
institutions) and more detailed information on manufacturing public undertakings with turnover of 
more than €250 million. 
3.210.  The Commission does not maintain a list of large public undertakings (e.g. with operating 
revenues greater than €1 billion) in the EU. However, information from various sources, including 
the OECD, indicates that there are a considerable number of public undertakings in the EU which the member States could control, e.g. through fu ll ownership, majority holdings, or through their 
statutory nature, although potential control does not necessarily imply any influence by the public 
authorities in the commercial activities of an undertaking. 
3.211.  A report on the trade effects and policy implications of state-owned enterprises noted the 
different levels of state ownership among the largest enterprises in the world in 2011. Using the 
Forbes 2000 list of the largest publicly-listed companies in the world
181, the report states that, for 
the EU member States in the OECD, 24 enterprises were classed as state-owned enterprises out of a total of 427 listed companies in the Forbes 2000  list, compared to 41 out of 1,500 for the OECD 
as a whole.
182 
3.212.  As a result of the financial crisis in the EU, some member States took holdings in financial 
companies in order to maintain the stability of the sector, including some on the Forbes 2000 list, such as: Royal Bank of Scotland in the United Kingdom; Dexia Group in Belgium, Bankia in Spain, 
and AIB Banks in Ireland. 
3.213.  In other cases,governments or other public authorities have majority holdings in suppliers 
of public services of general economic interest, or they have statutory corporations which provide 
such services. In transport, some of these public  undertakings include SNCF and Aéroport de Paris 
in France, and Deutsche Bahn in Germany. In en ergy-related areas, they include Verbund in 
Austria, CEZ Group in the Czech Republic, EDF in France, the Public Power Corporation in Greece, 
PGNiG Group in Poland, and Fortum in Finland. In other cases, the Government may own or 
control undertakings for investment and developmen t reasons, such as through the Groupe Caisse 
des Dépôts in France. 
3.3.5  Government procurement 
3.214.  Estimates made by the Commission put total public procurement expenditure by the 
general government sector on works, goods, and services (excluding utilities)
183 for 2013 at 
€1,786.61 billion, 0.67% higher than in 2012. This represented 13.7% of EU GDP in 2013. A large 
part of this procurement is subject to public proc urement rules, either national or EU disciplines. 
                                               
181 Forbes online information. The Worl d's Biggest Public Companies. Viewed 
at:http://www.forbes.com/global2000/#page:1_sort:0_direction:asc_search:_filter:All%20industries_filter:All
%20countries_filter:All%20states  [February 2015]. 
182 Kowalski P., Büge M., Sztaje rowska M., Egeland M. (2013), State-Owned Enterprises – Trade Effects 
and Policy Implications, OECD Trade Policy Papers, No. 147, OECD Publishing, Table A1. Viewed at: 
http://dx.doi.org/10.1787/5k4869ckqk7l-en  [February 2015]. 
183 Since 2013 the Commission excludes expenditures by utilities from these statistics due to the 
reported questionable reliabili ty of the available figures. WT/TPR/S/317 • European Union 
 
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  Public contracts subject to EU disciplines (i.e. above the thresholds) accounted for around 
€422.8 billion in 2013 including utilities, 5.3% more than in 2012. Excluding utilities, the increase was 3.6% from €328.77 billion in 2012 to €340.72 billion in 2013.
184 
3.215.  All procurement carried out in the EU ab ove specified thresholds must comply with the 
requirements of the EU Directives on procurement,  which are reflected in relevant legislation and 
regulations of the EU member States. The pre-ex isting legal framework (Directive 2004/18/EC on 
the procedures for the award of public work contract s, public supply contracts, and public services 
contracts, and Directive 2004/17/EC, known as the Ut ilities Directive, on procurement procedures 
of entities in the domains of water, energy, tran sport, and postal sectors) was replaced by a new 
set of directives, whose transposition into national law by the member States is ongoing: namely Directives 2014/23/EU on the award of concession contracts; 2014/24/EU on public procurement; 
and 2014/25/EU on procurement by entities operat ing in the water, energy, transport and postal 
services sectors. Those directives entered into force as of 17 April 2014 with up to 24 months for transposition, except for the provisions on e-procurement where it is 30 months. 
3.216.  According to these Directives, above-threshold public procurement must be advertised 
EU-wide and must follow uniform procedures. The latest thresholds on procurement of supplies, 
services, and construction works, as specified in Commission Regulation (EC) No. 1336/2013 of 
13 December 2013, amending Directives 2004/17/EC, 2004/18/EC, and 2009/81/EC entered into 
force on 1 January 2014 (Table 3.19). 
Table 3.19 Minimum public procurement thresholds, 2014-15
 
Relevant directive Authorities 
concerned Type of procurement Thresholds (€) 
Utilities Directive 
(water, energy, transport and postal 
services)  Works contracts 5,186,000 
All supplies and services contracts, all 
design contests 414,000 
Classical Directive 
(contracts for public 
works, public supply 
and public service) Central 
government 
authorities Works contracts, works concessions 
contracts, subsidized works contracts 5,186,000 
All contracts concerning services listed in 
Annex II B, certain telecommunications 
services and R&D services; all design 
contests concerning these services and all 
subsidized services 207,000 
All contracts and design contests 
concerning services listed in Annex II A 
except  contracts and design contests 
concerning certain telecommunications 
services and R&D services 134,000 
All supplies contracts awarded by 
contracting authorities not operating in the 
field of defence 134,000 
Supplies contracts awarded by contracting 
authorities operating in the field of defence Concerning products 
listed in 
Annex V:134,000 
Concerning other 
products: 207,000 
Sub-central 
contracting 
authorities Works contracts, works concessions 
contracts, subsidized works contracts 5,186,000 
All service contracts, all design contests, 
subsidized service contracts, all supplies 
contracts 207,000 
Source: Commission Regulation (EC) No. 1336/2013, 13 December 2013, amending Directives 2004/17/EC 
and 2004/18/EC and 2009/81/EC; and WTO document GPA/W/325/Add.5, 7 January 2014. 
                                               
184 For more statisti cal elements see: 
http://ec.europa.eu/internal_market/publicproc urement/docs/modernising_rules/20141105-indicators-
2012_en.pdf . WT/TPR/S/317 • European Union 
 
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  3.217.  There are "aggregation rules" in the procurement Directives regarding below-threshold 
procurement. For example, contracting authorities are required to aggregate the value of separate 
contract lots for works or services to be awarde d at the same time for a particular project. The 
value of each of the individual contracts may be less than the relevant EU financial threshold, but, 
the total value of these contracts may exceed the threshold. In such a case, the Directive will 
generally apply to the award of each sub-threshold contract. 
3.218.  Aggregation techniques are intended to improve cost-savings and the efficiency of 
procurement. In the EU, the most common instruments used for this purpose are framework 
agreements which establish the contractual terms that will apply to subsequent orders made for a period of time. Another aggregation technique us ed is centralized purchasing which involves 
centralized procurement bodies (CPBs) purchasing  on behalf of others, collaboration between 
procurers, and the use of service providers/entities to manage the purchasing process. 
3.219.  The use of framework agreements has increased in recent years. As of 2011, framework 
agreements constituted nearly 25% of the tota l value of all contracts awarded above the EU-
thresholds. In terms of numbers, they represent 1 in 6 of all contracts awarded. Centralized 
purchasing accounts for around 5% of the market in terms of the number of awards, and around 20% of the total value of contracts awarded be tween 2009 and 2011. The value of procurement 
subject to framework agreements has been increasi ng and, in many instances, a combination of 
CPBs and the use of framework agreements have been observed: more than half of all centralized purchases are carried out through a combined  use of CPBs and framework agreements.  
3.220.   Public procurement policy in the EU aims to achieve the best value for money through 
open, transparent and non-discriminatory procedures, consistent with the underlying objectives of 
the internal market. The applicable rules also mention other aspects such as social, innovation, and environmental considerations that can be incorporated into technical specifications, selection 
and award criteria, as well as contract-performance clauses. The new directives contain several 
new provisions described in more detail below. 
3.221.  The new directives have maintained separate disciplines for procurement carried out by 
public authorities and utility operators in the water, energy, transport, and postal services (so 
called "utilities"). While in some member States utilities are private-sector companies operating in a commercial environment, in others they are st ate-owned monopolies or oligopolies, or they 
compete with private companies. Private contracting entities in the utilities sector may also be 
covered by the Utilities Directive if they have a special or exclusive right granted by member 
States. According to the authorities
185, given the variety of ways that  member States can influence 
the behaviour of these entities and the nature of  the markets in which they often operate, the 
Utilities Directive is intended to ensure a fair balance in the application of procurement rules in the 
utilities sector. 
3.222.  In specific utility markets, where entities operate in a competitive environment to which 
market access is not restricted, the Utilities Directive grants exemptions from the procurement 
rules, upon the Commission's approval, when it considers the existing competitive conditions ensure that contracting entities, state-owned or private, buy according to commercial considerations without favouring their national industry. In such cases, it is considered that 
procurement regulation is not needed. During th e period under review, the Commission approved 
some member States' requests to exempt specific markets. 
3.223.  One of the significant elements of the th ree new directives on public procurement is the 
new directive on concessions. Concessions are partnerships between the public sector and mostly-
private companies, where the latter exclusively op erate, maintain and carry out the development 
of infrastructure (ports, parking garages, toll roads) or provide services (which may be of general 
economic interest, such as energy and waste disposal for example). According to some studies, 
over 60% of all Public Private Partnerships (PPP) contracts in Europe are to be qualified as concessions. However, the fact that member States use different labelling for concessions, and the current lack of transparency on their award, makes systematic and precise measuring of their 
economic and social importance difficult. 
                                               
185 See for instance: Europe Economics (2011), Taking stock of utilities pr ocurement – A report for DG 
Internal Market , London, 11 February. Viewed at: http://ec.europa.eu/internal 
market/publicprocurement/docs/ modernising_rules/taking-stock -utilities-procurement en.pdf.  WT/TPR/S/317 • European Union 
 
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  3.224.  Previously, EU level disciplines on the aw ard of service concessions were not very clear, 
although the general principles of transparency and equal treatment under the TFEU applied. The 
Commission's assessment is that his loophole gave rise, in the past, to serious distortions of the Single Market such as direct awards of concessions contracts without transparency or competition 
(with associated risks of national favouritism, fraud and corruption) and generated considerable 
economic inefficiencies.
186 Directive 2014/23/EU takes account of the specific features of 
concessions as compared to public contracts which have been identified as justifying specific rules 
for their award. 
3.225.  The main novel features of the Directive include: 
• a clearer definition of a concession which is based on rulings by the Court of Justice of the 
EU;  
• the coverage of concessions for works and services, both in the utilities sector (except for 
water services) and in the classic sectors (i.e. all other sectors not covered by utilities);  
• the compulsory publication of concession notices in the Official Journal  of the EU  when 
their value is equal to or greater than €5,186,000;  
• a framework for dealing with changes to concessions' contracts during their term;  
• the establishment of obligations with respect to the selection and award criteria to be 
followed by entities awarding concessions (these rules aim to ensure that such criteria are 
published in advance, are objective and non-discriminatory and, in general, they are simpler and more flexible than similar provisions currently applicable to public contracts);  
• no standard mandatory award procedures (negotiations always possible) but instead 
establishment of certain general guarantees aimed at ensuring transparency and equal 
treatment (notably, in case of negotiations); and 
• application of the Remedies Directives (Directives 89/665/EEC and 92/13/EC, as amended 
by Directive 2007/66/EC) to all concessions covered by the Directive. 
3.226.  The two remaining directives of the package – Directive 2014/24/EU on public 
procurement and Directive 2014/25/EU on procuremen t by entities operating in the water, energy, 
transport and postal services sectors – introduce a number of rules and procedures aimed at 
simplifying the previous framework. They broaden the possibilities for negotiation: the competitive 
procedure with negotiation may be used if justified by the specific circumstances in relation to the nature, complexity, or the legal and financial make-up of a given project. The required tender 
documentation is reduced, notably through the compulsory acceptance of self-declarations from 
bidders (through a standardized European Single  Procurement Document); only the winning bidder 
will have to submit formal evidence (certificates and attestations). The minimum deadlines to 
submit tenders are shortened. The mandatory use of  means of electronic communication in public 
procurement is aimed at increasing accessibility to procurement in order to allow EU companies – especially SMEs – to exploit the full benefits of the Digital Single Market and to bring efficiency 
gains (the authorities estimate the savings to be €100 billion annually on total EU public 
procurement
187). 
3.227.  Local and regional authorities will be able to advertise their contracts via less burdensome 
prior-information notices (instead of contract notices) and will have the possibility to agree with 
pre-selected bidders on the deadlines applied in their procurement procedures. A simplified regime 
(higher threshold of €750,000 - no obligation to respect the EU rules on technical specifications, possibility to take into account all quality and continuity criteria considered necessary for the 
services in question, and to eliminate price as the sole award criterion for such services) will be 
put in place for social, health, cultural, and assimilated services. This simplified regime will also apply to legal services, hotels and restaurant services, and catering and canteen services. In the 
meantime, services that were, under previous rules, subject to lighter obligations (so called "non-
priority" or "B" sectors, such as water transport, and agricultural and forestry services), will be 
                                               
186 European Commission (2014), Directive of the European Parliament  and of the Council on the Award 
of Concession Contracts – Frequently Asked Questions, Press release , 15 January. Viewed at: 
http://europa.eu/rapid/press-release_MEMO-14-19_en.htm?locale=en . 
187 European Commission (2014), Revision of Public Procurement Directives - Frequently Asked 
Questions , 15 January.  Viewed at: http://europa.eu/rapid/press-rel ease_MEMO-14-20_en.htm?locale=en . WT/TPR/S/317 • European Union 
 
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  subject to the full set of rules of the Directives as  the principle is now established that all services 
not explicitly listed in the "new simplified regime " annex to the Directives will fall under the full 
regime of the new Directives. On the basis of the principles set out in the relevant case-law of the Court of Justice, the Directives clarify the conditions under which cooperation between public 
entities is exempt from the application of the Dire ctives in order to avoid exemptions resulting in a 
distortion of competition in relation to private economic operators. 
3.228.  Regarding the environmental aspects of pr ocurement, the concept of “life-cycle costing” 
introduced in the Directives is aimed at encouraging public authorities to consider the full life-cycle 
of products in their purchasing decisions. The life-cycle cost concept includes internal costs and costs imputed to environmental externalities (including the CO
2 footprint) linked to the product, 
service or works during its/their life cycle, prov ided their monetary value can be determined and 
verified. In their award decisions, contracting authorities may take into account criteria linked to 
the production process of the works, services or supplies to be purchased such as the inclusion of 
vulnerable and disadvantaged people or the use of  non-toxic substances. In addition, contracting 
authorities may require that works, supplies, or services bear specific labels certifying 
environmental, social or other characteristics, as long as the label requirements only concern criteria which are linked to the subject-matter of the contract and are appropriate to define 
characteristics of the works, supplies or services and that equivalent labels are accepted. 
3.229.  The new legislative framework also contains a series of provisions regarding the 
incorporation of other public policy objectives. First, to favour social inclusion, the current contracts' reservation in favour of sheltered workshops has been extended to economic operators 
whose main aim is the social and professional in tegration of disabled and disadvantaged workers; 
and the minimum required percentage of disabled  or disadvantaged employees is reduced from 
50% to 30%. Second, regarding innovation, all proc edures may now take account of the total life-
cycle cost of purchases when tenders are being evaluated. Thus, innovative bids may be awarded 
more points in the light of their long-term financial benefits. Innovation in social and health services will be encouraged by the simplified system, which is more flexible. 
3.230.  The competitive dialogue procedure has been simplified for technically and financially 
complex projects. A new procedure, called the "innovation partnership", will enable public 
purchasers to select partners on a competitive basis and have them develop an innovative solution tailored to their requirements: the competitive phas e will take place at the very beginning of the 
procedure, when the most suitable partner(s) are selected on the basis of their skills, abilities and 
price; and the partner(s) will develop the new solution, as required, in collaboration with the contracting authority. This research and development phase can be divided into several stages, 
during which the number of partners may be gradually reduced, depending on whether they meet 
certain predetermined criteria. The partner will th en provide the final solution (commercial phase). 
Pre-commercial public procurement and innovation  partnerships are two alternative approaches 
that correspond to different needs and/or situations. An innovation partnership is a genuine public 
procurement procedure with full legal guarantees, while a pre-commercial procurement is an exemption and falls outside the scope of the Directive. Finally, specific provisions for cross-border joint procurement will enable buyers from various member States to make joint purchases. 
Aggregating demand is intended to make it easier to share the risks associated with innovative 
projects and attract more risk capital. 
3.231.  The new Directives also contain a series of  provisions designed to fight corruption and to 
ensure more transparency. In particular member States now have an obligation to take steps to 
prevent, identify, and address conflicts of in terest which are precisely defined. The prior 
consultation phases, which could lead to situations that favour the companies involved, are now 
more stringently regulated; the public purchaser must take the necessary steps to ensure that the 
participation of a previously-consulted company does not affect competition within the tender procedure concerned; and, in particular, any information to which the company may be party as a result of its prior involvement must be sent to the other participating companies. However, this 
company may be excluded only as a last resort and if it is impossible to guarantee equal treatment 
for participating companies by any other means. 
3.232.  The grounds for excluding enterprises from public procurement have been enlarged and 
reinforced. In addition to conviction for fraud and corruption, they now include situations where a 
company has unduly influenced the decision-making process, false statements in connection with the procedure for the award of a public contract, and agreements to distort competition. Exclusion WT/TPR/S/317 • European Union 
 
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  may also be imposed by a member State. Since modifying contracts during their term without 
calling a new tender procedure may breach the rules on public procurement, the applicable rules in that regard have been clarified and simplified to try to remove any doubt in this regard. 
3.233.  Instead of creating a single oversight body  in each member State, the Directives provide 
for increased monitoring at the national level and for an obligation on member States to transmit 
to the Commission every three years a monitoring report covering information on the sources of wrong application, legal uncertainties, level of SME participation, prevention, detection and 
adequate reporting of procurement fraud, corrupt ion and conflicts of interest, and other serious 
irregularities. 
3.234.  Regarding e-procurement, the Commission notes that public buyers who have already 
made the transition to e-procurement commonly report savings of 5% to 20%. Given the size of 
the total procurement market in the EU, each 5%  saved could return around €100 billion to the 
public purse. Therefore, the new Directives make the use of e-procurement progressively 
mandatory by March 2016 for electronic notification and electronic access to tender documents; by 
March 2017 for electronic submission of offers for central purchasing bodies; and by 
September 2018 for electronic submission of offe rs for all contracting authorities. Tools and 
devices used for electronic communication are required to be non-discriminatory, generally 
available, and interoperable.  
3.235.  The new Directives require that member States keep up-to-date all the information about 
certificates required in their country in public procurement procedures and place them on the E-Certis database.
188 The Directives also contain provisions on dynamic purchasing systems 
(electronic systems allowing public purchasers to consult a large number of potential suppliers of 
standardized, "off-the-shelf" works, supplies or services), electronic auctions, and electronic catalogues. 
3.236.  Finally, regarding the utilities sectors the new Directives seek to clarify and improve the 
mechanism for exemption from the procurement ru les provided for in the current Article 30 of 
Directive 2004/17/EC. They further define the notion of “special and exclusive rights” and exclude 
from their scope activities related to the explor ation for oil and gas, because this sector has 
consistently been found to be exposed to competition. 
3.237.  Procurement according to EU rules (e.g . above the stipulated thresholds) must be 
published in the Official Journal  (S series) which may be accessed online through the TED 
website.
189 Member States' total expenditure on procurement is described in Table 3.20. The 
Commission indicated that differences in percentages of procurement published in the Official Journal  might be explained by, for example, the small value of individual contracts, and the 
various degrees of centralization among member States: most of the smaller contracting 
authorities may never make a purchase large enough to fall into the scope of the Directives, and member States with a generally higher degree of centralization are more likely to have tender 
invitations published in the Official Journal  because procurement tends also to be centralized.
190 
The Commission also pointed out that publicatio n requirements for below-threshold procurement 
vary among member States, and are established on a voluntary basis at EU-level. In some member States, contracting entities thus pub lish below-threshold procurement, whereas some 
publish above-threshold procurement only. 
                                               
188 http://ec.europa.eu/markt/ecertis/login.do?selectedLanguage=en . 
189 Tenders Electronic Daily, Supplement to the Official Journal of the European Union  online 
information. Viewed at: http://ted.europa.eu/ . 
190 European Commission (2011), Evaluation Report- Impact and Effect iveness of EU Public Procurement 
Legislation SEC(2011) 853 final, 27 June. Viewed at: 
http://ec.europa.eu/internal_market/public procurement/docs/modernising_rules/er853_1_en.pdf . WT/TPR/S/317 • European Union 
 
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  Table 3.20 Publication rate in terms of GDP and total expenditure on works, goods and 
services (excluding utilities), 2012-13 
 2012 2013 
 % Tot. exp . % GDP % Tot. exp. % GDP
Austria 9.65 1.07 11.82 1.33 
Belgium 16.60 2.28 19.06 2.59 
Bulgaria 54.93 5.96 64.61 7.77 
Croatia .. .. 25.08 3.08 
Cyprus 29.77 2.21 29.29 1.94 
Czech Republic 31.88 4.70 28.33 4.07 
Denmark 39.89 5.61 37.28 5.06 
Estonia 39.35 5.63 31.48 4.14 
Finland 19.24 3.31 18.87 3.36 
France 18.88 2.78 18.48 2.75 
Germany 5.97 0.86 6.40 0.94 
Greece 18.03 1.76 20.94 1.87 
Hungary 48.07 6.38 51.93 7.28 
Ireland 12.51 1.21 15.67 1.48 
Italy 15.50 1.60 19.54 1.97 
Latvia 57.72 6.74 51.90 5.90 
Lithuania 33.43 3.51 37.95 3.75 
Luxembourg 10.44 1.29 10.37 1.25 
Malta 33.78 3.48 35.75 3.44 
Netherlands 8.11 1.85 7.60 1.72 
Poland 35.31 4.42 47.52 5.73 
Portugal 14.32 1.53 15.73 1.64 
Romania 34.26 4.11 28.86 3.24 
Slovakia 36.22 4.28 57.03 6.71 
Slovenia 26.07 3.23 48.18 6.07 
Spain 15.99 1.63 13.40 1.31 
Sweden 22.40 3.64 22.79 3.72 
United Kingdom 34.02 4.92 32.90 4.76 
EU-average 18.53 2.54 19.07 2.61 
.. Not available. 
Source: Information provided by the authorities. 
3.238.  In 2011, approximately 41% of the valu e of contract award notices published in the 
OJ/TED was attributable to works contracts, 35% was spent on services, and 24% on goods. In 
terms of number of contracts the respective shares are 17% for works, 36% for supplies, and 47% for services. Open competition remains the most common type of procedure. The value of contracts awarded following this type of procedur e accounted for 51% of the value of all contracts 
awarded and published in 2011 (4% more than in th e previous year), representing approximately 
75% of all contract award notices (2% more than in the previous year). The second most popular 
procedure in terms of its share of the total value of contracts published is the restricted procedure 
(21% of the total value, against 22% reported in 2010), followed by negotiation with competition 
at 12%, competitive dialogue at 8%, and negotiation without competition at 4%. 
3.239.  Directive 2007/66/EC (Remedies Directive) provides legal remedies for breaches of EU 
procurement law, including a "standstill period," which requires contracting bodies to provide at 
least 10 days after deciding the winning bid before it can be signed, and more stringent rules against illegal direct awards of public contracts so that illegally-awarded contracts may be rendered ineffective (or null and void) by national courts. The Commission is actively monitoring 
the respect of EU rules by member States through infringement procedures and has opened 
numerous cases in recent years against a great number of member States. Since the thresholds of EU rules are aligned with that of the GPA and th eir substantive provisions are broadly similar to 
that of the GPA, these infringement procedures can be expected to contribute to the proper 
implementation of the GPA as well.  WT/TPR/S/317 • European Union 
 
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  3.240.  Approximately 20.8 million SMEs are regist ered in the EU, representing 99.8% of all 
enterprises, and they produce more than a half of  European GDP. Due to this, SMEs are the prime 
focus of European public policy wi th one of the objectives being the facilitation of their access to 
public procurement. Between 2009 and 2011, an  estimated 56% of all public procurement 
contracts above the EU-thresholds were awarded to  SMEs (or groupings of companies led by an 
SME). In terms of the aggregate value of contra cts awarded, this corresponded to a 29% market 
share. This figure is slightly below the estimate s of the previous three-year period (2006-2008). 
Between 2009 and 2011, 1.3% of all contracts above thresholds were awarded to economic 
operators located in a foreign country. In terms of the aggregate value of these contracts, this corresponds to 3.1% of all above-threshold procurement. Interestingly, the analysis does not reveal a significant difference between the prop ortions of SMEs among the companies winning 
domestic or direct cross-border contracts. SMEs won 56% of domestic public contracts and 54% of 
cross-border contracts. In terms of value, SMEs' share was lower in cross-border procurement (22%) than domestic procurement (29%).
191 
3.241.  The public procurement reform in 2014 introduced specific legislative measures to improve 
SMEs’ access to public procurement markets. These measures include in particular an encouragement to divide contracts into lots and the limitation of the turnover required to 
participate in a tender procedure. The sub-division of public purchases into lots facilitates access 
by SMEs both quantitatively (the size of the lots may better correspond to the productive capacity of the SME) and qualitatively (the content of the lots may correspond more closely to the specialised sector of the SME). The division of contracts into lots is encouraged through the “apply 
or explain” principle, i.e. when contracting au thorities deem that the division would not be 
appropriate, an individual report or the procurem ent documents should contain an indication of the 
main reasons for the contracting authority’s choice. Such reasons could be that the contracting 
authority finds that the division could risk restrict ing competition, or rendering the execution of the 
contract excessively technically difficult or expensive, or that the need to coordinate the different contractors for the lots could seriously undermine the proper execution of the contract. As far as 
proof of financial capacity of the economic operat or is concerned, the turnover requirements are 
limited to a maximum of twice the estimated value of  the contract, except in duly-justified cases. 
For its part, the new Directive on concessions is also for the benefit of SMEs, inter alia  through 
improving access to information and favouring their participation in consortia and as 
subcontractors. 
3.3.5.1  GPA and international procurement 3.242.  On 2 December 2013, and following the consent given by Parliament on 
19 November 2011, the Council adopted Decision 2014/115/EU approving the Protocol Amending 
the revised WTO Agreement on Government Procurement.
192 In the conclusion of the GPA re-
negotiation, enhanced EU commitments provide for further market access opportunities for 
suppliers offering goods and services originating in GPA Parties' economies. New sectors and 
contracting authorities/entities are now included in the EU schedules, for instance, the European External Action Service at EU level and a number of central government contracting authorities and sub-central entities of member States.
193 
3.243.  The coverage of the GPA is somewhat different from that of the Directives. The GPA covers 
entities, goods, and services, including construction services, as specified in EU’s Appendix I. In 2011, out of the total €335.4 billion above-thresh old procurement in the EU, some €237.2 billion 
was open to GPA Parties.
194 
3.244.  The value of EU contracts covered by the GPA for the most recent years available is 
described in Table 3.21 . 
                                               
191 PwC, ICT, GHK, Ecorys (2014), SMEs' access to public procurement markets and aggregation of 
demand in the EU , a study commissioned by the European Comm ission, DG Internal Market and Services, 
February. Viewed at: http://ec.europa.eu/internal_market/publicp rocurement/docs/mode rnising_rules/smes-
access-and-aggregation-of-demand_en.pdf  [March 2015]. 
192Council Decision 2014/115/EU on the conclusion of  the Protocol Amending the Agreement on 
Government Procurement, OJEU L68/1 07/03/2014. 
193WTO document GPA/113, 2 April 2012. 
194 EU Statistical Report for 2011 reported under Article XIX:5 of the Agreement on Government 
Procurement. Viewed at: https://www.wto.org/english/tratop_e/gproc_e/notnat_e.htm#statPro . WT/TPR/S/317 • European Union 
 
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  Table 3.21 EU procurement and GPA key figures, 2009-11 
(€ billion) 
EU procurement 2009 2010 2011
Value of contracts covered by GPA 250.84 227.94 237.18 
Value of contracts above thresholds 353.40 318.81 335.37 
Value of contracts awarded under Article XV GPA 
(i.e. limited tendering contracts) 14.45 9.87 7.26 
Total expenditures on goods and services 2,346.01 2,416.55 2,405.88 
Source: WTO documents GPA/108/add 7 and GPA/114/add 5, both dated 22 October 2014. 
3.245.  In addition to the GPA, the EU has also been playing a leading role in various negotiation 
initiatives where government procurement is an important element. In the discussions that have 
taken place in the WTO Working Party on GATS Ru les, the EU circulated proposals on various 
aspects of government procurement in services, including the extension of MFN principle to 
government procurement, the scheduling of market  access commitments, procedural rules, special 
and differential treatment for developing countries, etc. In the plurilateral negotiations on the 
Trade in Services Agreement (TISA), the EU tabled a proposal to cover government procurement 
obligations and stipulated that service providers established in another TISA signatory's territory would be afforded national treatment for government procurement contracts. 
3.246.  The EU has also signed a number of bilateral agreements that include chapters on 
government procurement with Albania (2006), Bosnia and Herzegovina (2008), Chile (2003 for 
goods, 2005 for services), FYROM (2004), Israel (2000), Jordan (2002), Republic of Korea ( 2011), Mexico (2000), Montenegro (2008 for goods, 2010 for services), South Africa (2000) and 
Switzerland and Liechtenstein. The plurilateral European Economic Area (EEA) (1994) and EU 
CARIFORUM (2008) agreements, as well as the bilateral agreements with Iraq (2012), Georgia (2014) and Moldova (2014) also have substantial provisions on government procurement.  
3.247.  FTAs including substantial procurement chapters have been negotiated with Central 
America and the Andean countries and were firs t concluded with Colomb ia and Peru. In 2014 the 
CETA agreement with Canada was finalized. EU also finalised its agreement with Singapore. 
3.248.  As reported in the previous Review, in March 2012 the Commission tabled a proposal 
aimed at improving the conditions under which EU businesses can compete for public contracts in third countries, confirming the legal status of bidders, goods and services from countries that have an international agreement with the EU in the area  of public procurement, and clarifying the rules 
applicable to bidders, goods and services not covered by these agreements. The proposal also 
foresees that, if an EU investigation were to show "recurring and serious discrimination" against EU companies, the Commission should invite the third party to negotiations aiming at finding a 
solution. As a last resort, and only if the Partner shows no willingness to engage, the EU would be 
able to temporarily close its market to goods and services from that third-country partner regarding public procurement contracts worth €5 million or more excluding VAT.
195 
3.249.  In January 2014, the European Parliament put forward several amendments to these 
proposals. In particular, it recommended that the exception foreseen for developing countries should be extended to countries considered "to be vulnerable due to a lack of diversification and insufficient integration within the international trading system and in the world economy." The 
Commission has announced in its work programme for 2015 the decision to review and amend its 
proposal in order to simplify the procedures, shortening timelines of investigations and reducing the number of actors in implementation. 
3.3.5.2  Other developments 
3.250.  On 16 April 2014, the European Parliament and the Council reached agreement on the 
Directive 2014/55/EU on e-invoicing in public proc urement. The Directive was to enter into force 
on 26 May 2014. The Directive calls for making the receipt and processing of electronic invoices in 
public procurement obligatory, and for the develo pment of a new European e-invoicing standard 
                                               
195 WTO document WT/TPR/S/284/Rev2, paragraph 3.223. WT/TPR/S/317 • European Union 
 
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  by the European Committee for Standardisation (CEN). This new European standard is to become 
mandatory four-and-a-half years after the entry-in to-force of the Directive. However, member 
States will have the possibility to postpone the deadline by a further 12 months for regional and local authorities due to the special requirements  for these bodies, such as their more limited 
resources and potentially less-developed infrastructure. The resulting savings are estimated at 
around €64.5 billion per year for businesses. 
3.251.  In addition to these e–procurement aspects of the new legislative package, on 
26 June 2014, the Commission presented a roadmap, based on its 24 July 2013 communication on 
the defence and security sector
196, for measures to strengthen the Single Market for defence, to 
promote a more competitive defence industry, and to foster synergies between civil and military research. The roadmap suggests to complement the pre-existing legal framework, directive 
2009/81/EC of 13 July 2009 " on the coordination of procedures for the award of certain works 
contracts, supply contracts and service contracts by contracting authorities or entities in the fields of defence and security " (so-called defence procurement directive)
197 by clarifying the exclusions 
from the Defence Procurement Directive and by identifying and countering unjustified 
discriminatory offset requirements in procurement. In parallel, the Commission will look together with member States and industry at ways of promoting cross-border market access for SMEs by 
non-discriminatory means. 
3.3.6  Intellectual property rights 3.252.  For the EU, a knowledge-based economy, intellectual property rights (IPRs) are generally 
considered a vital backbone of the economy and a main driver for growth, as they are seen as a 
key element to ensure that creativity and in novation are rewarded. The conclusions of the 
European Council held on 20-21 March 2014
198 have reiterated that "intellectual property and 
patenting were key drivers for growth and innovation "; however, they also noted that "despite its 
leading role in a number of technology industries, the European Union was lagging behind in 
patenting". 
3.253.  This finding is backed by the continuing decrease of the European Patent Office (EPO) 
share of total worldwide patent filings: in the peri od from 2012 to 2013, it went down by 0.4% to 
5.8%.199 The importance of IPR protection in the EU continues to be reflected by the high number 
of applications and titles granted. For example,  in 2014, the EPO recorded a 3.1% increase in 
patent filings, while the number of patents granted decreased also by 3.1%. In total numbers, 
applications went up from 266,000 to 274,174, with about two-thirds of applications submitted by 
inventors from non-EPO countries of origin, and the number of patents granted amounted to 64,613 in 2014, as compared to around 66,700 in 2013.
200 In the field of trademarks, the Office 
for Harmonization in the Internal Market (OHIM) reported an annual growth of 6% in applications 
in 2013. According to OHIM statistics, annual applications for Community trademarks went up from 107,927 in 2012 to more than 114,000 in 2013 of  which 16% resulted from an international 
application designating the EU under the Madrid Pr otocol administered by the World Intellectual 
Property Organization (WIPO); registrations in creased from 95,630 to 98,075 during the same 
period. In November 2014, there were 1,080,000 registered Community trademarks in total.
201 
3.254.  According to a joint OHIM/EPO report published in September 2013202, around 39% of 
total economic activity in the EU (worth some €4. 7 trillion annually) is generated by IPR-intensive 
                                               
196 For the full text of the communication see: http://eur-lex.europa.eu/legal-
content/EN/TXT/?uri=CELEX:52013DC0542 . 
197 For the full text of the directive see: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:216:0076:0136:en:PDF . 
198 EUCO 7/1/14/Rev.1 of 21 March2014, para. 11; viewed at: 
http://www.consilium.europa.eu/uedocs/cms_Data/docs/pressdata/en/ec/141749.pdf . 
199 WIPO, World Intellectual Property Indicators 2014. Viewed at: 
http://www.wipo.int/edocs/pubdocs/en/wipo_pub_941_2014.pdf .  
200 See EPO Annual Report 2014. Viewed at: http://www.epo.org/about-us/annual-reports-
statistics/annual-report/2014.html . 
201 OHIM statistics. Viewed at: https://oami.europa.eu/tunnel-
web/secure/webdav/guest/document_library /contentPdfs/about_ohim/the_office/SSC009-
Statistics_of_Community_Trade_Marks-2014_en.pdf . 
202 For the full text of the report see: http://ec.europa.eu/internal_market/intellectual-
property/docs/joint-report-e po-ohim-final-version_en.pdf . WT/TPR/S/317 • European Union 
 
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  industries. Approximately 26% of all employment ( 56 million jobs) is provided directly by these 
industries, while a further 9% of jobs are indirectly generated by IPR-intensive industries. Adapting a methodology previously used by the U. S. Patent Office, the study makes an attempt to 
quantify the overall contribution made by IPR-inte nsive industries to the EU economy in terms of 
output, employment, wages and trade, taking into  account the major IP rights (copyright and 
related rights, patents, trademarks, geographical in dications (GI) and designs). An overview of its 
main results are provided in Table 3.22. 
3.255.  The EU is also a major player in the Inte rnational Union for the Protection of New Varieties 
of Plants (UPOV) with regard to the granting of plant breeder rights. The Community Plant Variety Office (CPVO) reported a continuous growth in applications for plant variety rights. According to CPVO statistics, annual applications for Community plant variety rights went up from 1,825 in 
2005 to 3,626 in 2014. This corresponds to more than 51,650 applications from 1995 to 2014 for 
1,815 different botanical species/genera. At end 2014, a total of 22,572 protected varieties were registered under the Community Plant Variety Rights System. 
3.256.  The core role of knowledge-based industries that rely on IPRs had already been recognized 
by the "Europe 2020" Strategy
203, as well as, in particular, by "Horizon 2020", the EU's new 
Framework Programme for Research and Innovation for the period 2014-2020.204 It makes 
€80 billion of funding available over seven years and establishes clear rules for the exploitation 
and dissemination of IPRs resulting from research projects conducted within this framework. At the 
same time, it acknowledges the need to ensure open access to scientific publications and to promote open access to research data that result from publicly-funded research under this 
programme. 
Table 3.22 Contribution of the IP- industri es to EU employment, GDP and trade and 
average wage premium of IP-intensive industries, 2008-10 
(%) 
IP right Share of total 
EU direct 
employment Share of total 
direct and 
indirect 
employment Share of total 
EU GDP Average wage 
premium 
compared to non-
IPR-intensive 
industries Share of EU 
exports Share of EU 
imports 
All-IPR 
industries 25.9 35.1 38.6 41 90.4 88.3
Copyright-
intensive 
industries 3.2 4.13 4.2 69 4.2 2.7
Patent-
intensive industries 10.3 16.1 13.9 64 70.6 68.6
Trade 
mark-
intensive 
industries 20.8 28.9 33.9 42 75.5 75.7
GI-
intensive 
industries  0.2 .. 0.1 46 0.8 0.1
Design-
intensive 
industries 12.2 17.4 12.8 31 53.4 46
.. Not available. 
Source: "Intellectual Proper ty Rights Intensive Industries: Contri bution to Economic  Performance and 
Employment in the European Union, Industry-Lev el Analysis Report", jo int OHIM/EPO study of 
September 2013. 
3.257.  The IPR regime in the EU is governed bo th by EU legislation and legislation in member 
States. Based on Article 118 of the TFEU, the EU ha s put in place an extensive body of intellectual 
property legislation. Table A3.5 in the Annex pr ovides an overview of the principal legislative 
measures adopted by the EU, as well as their stat us of notifications to the WTO. Member States' 
                                               
203 See Europe 2020, Communication from the European Commission of 3 March 2010 (COM(2010)2020 
final); for further information, see http://ec.europa.eu/europe2020/index_en.htm . 
204 Regulation (EU) No. 1291/2013 of the European Parliament and of the Council of 11 December 2013 
establishing Horizon 2020 - the Framework Programme for Research and Innovation (2014-2020) and repealing Decision No.1982/2006/EC, OJEU L347/104 of 20 December 2013.  WT/TPR/S/317 • European Union 
 
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  legislation implements and complements, where appropriate, EU legislation and commitments 
under international agreements. The EU is an observer to WIPO, while its member States are WIPO member States. The EU and 24 of its member States
205 are also UPOV Contracting Parties. 
3.3.6.1  Copyright and related rights 
3.258.  Copyright has a significant economic and so cial impact in the EU economy. For example, 
the value of the recorded music market in the EU amounted to approximately €4.32 billion in 
2013, witnessing a marginal growth for the first time after years of declining sales206; at the same 
time, a significant growth of 13.3% in reve nues generated by digital music was reported.207 Based 
on 2011 data, an external report published in September 2014208 found that the core creative 
industries209 in the EU generated €558 billion in value added to GDP, i.e. approximately 4.4% of 
the EU's total GDP. According to this report, the same industry represented approximately 8.3 
million full-time equivalent jobs, or 3.8% of total European workforce. Compared to an earlier 
report launched in 2010 and based on 2008 data, the value added of the core creative industries 
to the total GDP thus remained unchanged, whereas the number of jobs in this industry saw a 
slight decrease of 2.4%. 
3.259.  Based on its 2011 blueprint for IPRs210, the EU is continuing the review and modernization 
of its legislative framework under which copyri ght and related rights can be protected and 
enforced. As part of this process, Directive 2014/26/EU on Collective Management of Copyright 
and Related Rights and Multi-Territorial Licensing of Rights in Musical Works for Online Use in the Internal Market was adopted on 26 February 2014.
211 EU member States are required to 
implement the Directive into national law by April 2016. Its main objective is to establish a 
coordinated framework that provides for sound and transparent management of copyright and 
related rights by collective management organizations; it also aims at facilitating cross-border licensing of authors' rights in musical works for online use so that these can be distributed across 
the EU while ensuring that the revenues due to the authors are collected.
212 
3.260.  Also as part of the legislative reform process of the EU copyright rules in order to adapt 
them to the digital age, the Commission initiated a public consultation that was held from 
December 2013 to March 2014. A broad range of themes was covered by these consultations, 
including: issues raised by territoriality in the Union market; the need for further harmonization; the application of limitations and exceptions to co pyright in the digital age; the fragmentation of 
the EU copyright market; and how to improve th e effectiveness and efficiency of enforcement 
while underpinning its legitimacy in the wider context of copyright reform. The results of the 
consultation were published in July 2014.
213 
3.261.  As foreshadowed in its Communication on Content in the Digital Single Market214, the 
Commission also commissioned a series of external technical studies that examined legal and 
economic issues related to the creation of a co mprehensive framework for copyright in the Digital 
Single Market. The studies covered the following topics: 
                                               
205 Except Cyprus, Greece, Luxembourg and Malta. 
206 Source: IFPI, Music Report 2014. Viewed at: 
http://www.billboard.com/biz/articles/news/global/5937645/ifpi-music-report-2014-global-recorded-music-
revenues-fall-4 . 
207 Source: IFPI, Digital Music Report 2014. Viewed at: http://www.ifpi.org/do wnloads/Digital-Music-
Report-2014.pdf . 
208 The Economic Contribution of th e Creative Industries to EU GDP and Employment, prepared by TERA 
Consultations, viewed at: http://www.forum-avignon.org/sites/default/files/editeur/2014-Oct-European-
Creative-Industry-GDP-Jo bs-full-Report-ENG.pdf .  
209 Creative industries include inform ation services such as publishing activities (books, periodicals and 
software), motion pictures, video an d television programme pr oduction, sound-recording and music-publishing 
activities, programming and broadcas ting activities, computer programming, architectural and engineering 
services, advertising, design activi ties, photographic activities, translation and interpretation activities, 
creative, arts and entertainment activities. 
210 See 2013 EU TPR Report, WT/TPR/284/Rev.2, para.3.241. 
211 OJEU L84/72, 20 March 2014; also notified to the WTO (IP/N/1/EU/3 and IP/N/1/EU/C/9). 
212 For a detailed description see the previous EU Review, WT/TPR/284/Rev.2, para. 3.248. 
213 For the full report of th is public consultation see 
http://ec.europa.eu/internal_market/consultations/ 2013/copyright-rules/docs/contributions/consultation-
report_en.pdf   
214 COM(2012) 789 final of 18 December 2012. WT/TPR/S/317 • European Union 
 
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  (i) the application of Directive 2001/29/EC on copyright and related rights in the 
information society (December 2013).215 It assessed the extent to which the 
implementation of the Directive responds to the realities of digital markets and evaluated 
whether further harmonization of national copyright provisions is needed in order to 
support the cross-border exchange of services and information in the EU; 
(ii) an "Economic Analysis of the Territoriality of the Making Available Right in the EU” 
(March 2014).216 Among the key issues discussed were whether the current legal 
framework for copyright and related rights needed to be updated in order to deal with the 
provision of online on-demand service, if territorial licensing hampers EU-wide dissemination of content, and how territorial licensing relates to social welfare; 
(iii) the Making Available Right and its Relationship with the Reproduction Right in Cross-
Border Digital Transmissions (December 2014).
217 It focused on the link between the 
making available right and the reproduction ri ght and looked into accompanying measures, 
including legislative changes, that might be needed in cases where the recommendations 
of the above-mentioned study were implemented; 
(iv) "Assessing the Economic Impacts of Adapting Certain Limitations and Exceptions to 
Copyright and Related Rights in the EU". Published in October 2013, the first part proposed 
a methodology to assess exceptions and limitations to copyright.218 The second part, 
published in June 2014, looked into specific policy options219; and 
(v) the Legal Framework of Text and Data Mi ning (March 2014) which examined how such 
data analysis activities were covered by th e EU's present legal framework, be it under 
copyright legislation or that related to database protection.220 
3.262.  In its aforementioned Communication on  Content in the Digital Single Market, the 
Commission had indicated that, in addition to completing its efforts to review the EU's copyright 
legislation, it would address a number of issues in parallel which required rapid progress, including 
through a structured stakeholder dialogue with the assigned objective of delivering practical industry-led solutions to these issues that do  not prejudice further public policy action. The 
subsequently launched "Licences for Europe" stakeh older dialogue explored the possible limits of 
innovative licensing and technological solutions in making EU copyright law and practice fit for the digital age. The closing event on 13 November 2013 translated into ten voluntary pledges by the industry (Box 3.1).
221 Their implementation will be monitored by the Commission. 
3.263.  A Commission-led dialogue with the private sector and encouragement to voluntary 
pledges during the period under review also resulted in the adoption, on 17 February 2014, of “Key Principles and Recommendations on the Management of the Author Resale Right” by 
representatives of collecting management organizati ons, authors and art market professionals (art 
dealers, galleries, auctioneers).
222 The objective is to improve the operation of the resale right in 
the Union market, including through enhanced transparency, regarding the collection and 
distribution of resale right, as well as through raising awareness among artists and dealers about 
the existence and functioning of this right. 
                                               
215 For the full text of the study see: 
http://ec.europa.eu/internal_market/copyright/docs/studies/131216_study_en.pdf . 
216 For the full text of the study see: 
http://ec.europa.eu/internal_market/copyright/docs/studies/1403_study1_en.pdf . 
217 For the full text of the study see: 
http://ec.europa.eu/internal_market/copyright/docs/studies/141219-study_en.pdf . 
218 For the full text of the study see: 
http://ec.europa.eu/internal_market/copyright/docs/studies/131001-study_en.pdf . 
219 For the full text of the study see: 
http://ec.europa.eu/internal_market/copyright/docs/studies/140623-limitations-economic-impacts-
study_en.pdf . 
220 For the full text of the study see: 
http://ec.europa.eu/internal_market/copyright/docs/studies/1403_study2_en.pdf . 
221 For the full text of the pledges see http://ec.europa.eu/internal_market/copyright/docs/licences-for-
europe/131113_ten-pledges_en.pdf . 
222 For the full text of the prin ciples and recommendations see 
http://ec.europa.eu/internal_market/copyright/docs/resale/140214-resale-right-key-principles-and-
recommendations_en.pdf . WT/TPR/S/317 • European Union 
 
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  3.264.  The Court of Justice of the European Unio n (CJEU) further developed its jurisprudence in 
the field of copyright and related rights in a numbe r of landmark cases. For example, in line with 
its earlier jurisprudence, the Court upheld in a preliminary ruling of 11 July 2013 that imposing private copying levies on the first sale of blank media such as CDs and DVDs is not precluded by 
EU law (Directive 2001/29/EC)
223 as it constitutes a means of ensuring that rightholders receive 
fair compensation for reproductions of protected works made by virtue of the private copying exception. Such levies may be applied indiscriminately to the first placing on the market of 
recording media suitable for reproduction provided that they may be effectively reimbursed if the 
final use of those media is not for the purpose of private copying. The Court will have an opportunity to further develop its case law in matters related to private copying levies: on 10 September 2014, the Spanish Supreme Court referred a question regarding the compatibility of 
the system introduced by Royal Decree 1657/2012 with Directive 2001/29/EC.
224 
Box 3.1 Voluntary pledges by the copyright industry 
Issues Industry pledges 
Cross-border access and 
portability of services 1. Audiovisual industry to continue to work towards further development of 
cross-border portability of films, TV programmes and other audiovisual 
content. 
2. Publishers, booksellers and authors to promote cross-border access, 
interoperability an d discoverability of e-books. 
Licensing and user-generated 
content 3. Record producers to offer a new EU -wide licence enabling background 
music on websites; collective management organizations to spread best 
practice regarding licensing schemes. 
4. Print industry to provide new licensing solutions that allow users to know 
what they are able to do with text  and images and to seek permission 
through streamlined licensing solutions if needed. 
5. Web "self-publishers" to be provided with machine-readable identification 
to their content in order to facilitate claims and acknowledgement of 
authorship and associated rights. 
6. Press publishers to engage with readers to improve user experience, 
including via the uptake of user-generated content in their online 
publications and services. 
Audiovisual heritage 7. How to digitize, restore and make available European film heritage, 
including as regards cost-sharing an d remuneration, agre ed between film 
heritage institutions and film producers. 
8. Broadcasters and rightholders to find solutions for the digitization and 
making available of broadcasters' TV footage archives. 
9. Audiovisual producers to adopt interoperable audiovisual work identifiers 
to support rights manage ment, including licensing and remuneration, and 
thus to facilitate distribution an d discoverability of such works. 
Text and data mining 10. Scientific publishers to apply a licensing clause for material subscribed to 
by research institutions that authorize researchers to mine data and text 
for non-commercial scient ific purposes and at no additional cost. 
Source: WTO Secretariat. 
3.265.  Defining the scope of exceptions to copy right has also been the subject of several CJEU 
judgments. On 5 June 2014, the Court ruled, for example, that the exemption in Article 5 of 
Directive 2001/29/EC extended to copies on a user 's computer screen and copies on the internet 
c a c h e  o f  a  c o m p u t e r ' s  h a r d  d i s k  t h a t  w e r e  m a d e  b y  a n  e n d – u s e r  i n  t h e  c o u r s e  o f  v i e w i n g  a  
website. As such copies were temporary, transi ent or incidental in nature, and constituted an 
integral part of a technological process, th ey could be made without the rightholder's 
                                               
223 Case C-521/11 - Amazon v Austro-Mechana Gesellschaft zur Warhnehmung mechanisch-
musikalischer Urheberrechte Gesellschaft GMBH. Viewed at: http://curia.europa.eu/juris/document/document.jsf?text=&docid=139407&pageIndex=0&doclang=EN&mode=
req&dir=&occ=first&part=1&cid=365095 . 
224 Viewed at: http://www.lawblogs.net/go/spanish-supreme-court-refers-questions-to-cjeu-on-private-
copying-levies . WT/TPR/S/317 • European Union 
 
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  authorization.225 This ruling was seen as a major clarification both for internet users in Europe, but 
also for companies that aim for an expansion of their activities in the internet economy. 
3.266.  Among the relevant developments in EU member States are amendments to the copyright 
law in Spain that were adopted on 4 November 2014.226 One of the changes introduced by the 
amended law requires website owners to remove link s to copyright-infringing material in case of 
large-scale infringing websites offering hyperlinks through an active and non-neutral activity, so long as they are not carrying out mere technical intermediation. Changes to the copyright law also 
include what has become known as the "Google Tax": as of January 2015, online content 
aggregators benefit from an exception to copyrigh t  i n  o r d e r  t o  p o s t  e x c e r p t s  o f  n e w s  a r t i c l e s  
online; this exception is, however, subject to the payment of compensation to the organization representing newspapers. Google responded by a nnouncing, on 11 December 2014, that it will 
close its news service in Spain. In Germany, for example, the introduction of an "ancillary 
copyright law for press publishers" in a 2013 amendment of the Copyright Law
227 led to the 
removal of newspapers concerned from Google Ne ws. Subsequently, publishers requested to be 
relisted as they had witnessed a decrease in traffic.228 On the other hand, instead of adopting 
legislative measures, an agreement was reached in France on 1 February 2013 that allows the display of news content in Google's search result in exchange for a payment of €60 million to 
French publishers.
229 
3.267.  As regards infringement procedures, the Commission formally requested France, Poland 
and Romania in July 2014, as well as Cyprus and Luxembourg in October 2014, to fully implement Directive 2011/77/EU of the European Parliame nt and of the Council of 27 September 2011 
amending Directive 2006/116/EC on th e term of protection of copyright and certain related rights. 
Among others, the Directive extends the term of protection for performers and sound recordings 
from 50 to 70 years. Despite the expiration of the deadline for implementation in November 2013, 
no implementing measures had been notified to the Commission by the member States concerned. 
Another request was addressed to Italy on 28 March 2014 urging it to respect EU rules on copyright protection of designs under the Directiv e 98/71/EC on the legal protection of designs. 
3.268.  On 30 April 2014, the European Union signed the 2013 Marrakesh Treaty to Facilitate 
Access to Published Works for Persons Who Are Blind, Visually Impaired, or Otherwise Print Disabled that was concluded under the auspices of WIPO. On 21 October 2014, the Commission proposed the ratification, on behalf of the EU, of the Marrakesh Treaty which is due to enter into 
force upon acceptance by 20 WIPO member States.
230 The Treaty provides for a mandatory 
exception to copyright under which copies can be produced, distributed or made available in accessible format to visually impaired persons wi thout the authorization of the rightholder. Books 
in formats such as Braille, large print, e-books and audio books with special navigation tools can 
thus be exchanged across borders within the EU and with third countries. The Beijing Treaty on 
Audiovisual Performances, adopted at a WIPO Dipl omatic Conference in June 2012, was signed by 
the EU and 22 member States.
231 
                                               
225 Case C-360/13 - Public Relations Consultants Association Ltd v Newspaper Licensing Agency Ltd and 
Others. 
226 The Spanish version of the law is available on WIPO Lex at 
http://www.wipo.int/edocs/lexdocs/laws/es/es/es178es.pdf . 
227 See "Achtes Gesetz zur Änderung des Urhe berrechtsgesetzes" of 7 May 2013. Viewed at: 
http://www.bgbl.de/banzxaver/bgbl/start.xav?star tbk=Bundesanzeiger_BGBl&jumpTo=bgbl113s1161.pdf#__b
gbl__%2F%2F*%5B%40attr_id%3D% 27bgbl113s1161.pdf%27%5D__1419337459247 . 
228 For a discussion of the state of play in German y see the report "German publishers vs Google" by 
Deutsche Welle, viewed at: http://www.dw.de/german-publishers-vs-google/a-18030444 . 
229 See "Google inks landmark deal with France", reported by Deutsche Welle on 6 February 2013. 
Viewed at: http://www.dw.de/google-inks-landmark-deal-with-france/a-16577894 . 
230 See press release IP/14/1185 of 21 October 2014, available at: http://europa.eu/rapid/press-
release_IP-14-1185_en.htm?locale=en . 
231 State of play of contracting parties on 3 March 2015. Viewed at: 
http://www.wipo.int/treaties/en/ShowResults.jsp?lang=en&treaty_id=841 .  WT/TPR/S/317 • European Union 
 
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  3.3.6.2  Industrial property 
3.3.6.2.1  Patents 3.269.  As noted in the previous TPR report
232 and for the reasons explained therein, the European 
Parliament and the Council reached a political agreement on the unitary patent package in 
December 2012. It comprises Regulation (EU) No. 1257/2012 of 17 December 2012 
"Implementing Enhanced Cooperation in the Area of the Creation of Unitary Patent Protection"233 
which will allow a rightholder to get patent protection in 25 member States (except Croatia, Italy 
and Spain) based on a single request, and Council Regulation (EU) No. 1260/2012 of 
17 December 2012 "Implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements".
234 They will apply from 
the date of entry into force of the third comp onent of the unitary pate nt package, i.e. the 
international Agreement on the Unified Patent Co urt (UPC Agreement) which was signed by 25 EU 
member States (except Croatia, Poland and Spain) in early 2013.235 It establishes the framework 
for a specialized court with exclusive competence for litigation regarding the unitary patent. 
Acceptance by 13 member States, including the th ree member States with the highest number of 
European patents in force (Germany, France and the United Kingdom) is required for its entry into force. In January 2015, only six member States had ratified the UPC Agreement.
236 
3.270.  The preparatory work and procedural st eps for the implementation of the package are 
following their course.237 In particular, two Committees are in charge of preparing technical, 
regulatory and procedural rules required for it s implementation. Next to supervisory functions 
regarding the tasks to be attributed to the EPO, such as administering requests for unitary patent 
protection and the Register, the Select Committee is responsible for the setting of the level of 
renewal fees and their distribution to participating member States. The Preparatory Committee, established by the signatories of the UPC Agreem ent, is entrusted with the creation of the 
functional rules that will govern the future Unitary Patent Court, including its procedural rules and 
the setting of applicable fees, as well as the selection of judges. These two bodies were initially expected to complete their work at the beginning of 2015 . However, a second progress report sent 
to the European Council in June 2014
238 indicated that the Select Committee was aiming for the 
completion of its work during the first semester of 2015 and the Preparatory Committee for the end of 2015. 
3.271.  Meanwhile, a number of challenges continue to be discussed in relation to the introduction 
of the unitary patent. Those include the need to es tablish a predictable jurisdiction within the UPC 
the consistency of which had to be supported by the Court of Appeal; the potential impact of the unitary patent on the European patent, i.e. whet her the former is going to supersede the latter; 
the calculation of fees for the unitary patent; the financing and cost-effectiveness of the UPC as a 
non-EU institution; etc. 
3.272.  As noted above, Croatia, Italy and Spain decided not to participate in the enhanced 
cooperation on the unitary patent protection. Spain and Italy filed an action for the annulment of 
the unitary patent package over language and institutional concerns before the CJEU. The Court dismissed those actions on 16 April 2013.
239 Subsequently, a second set of cases was filed by 
Spain in March 2013, challenging the conformity of Regulation (EU) No. 1257/2012 (Case C-
146/13) and Council Regulation (EU) No. 1260/2012 (Case C-147/13) with EU law and 
                                               
232 WT/TPR/S/284/Rev.2, paragraphs 3.257 to 3.265 (pp. 94-96). 
233 OJEU L361/1, 31 December 2012. 
234 OJEU L361/89, 31 December 2012. 
235 The text of the Agreement on a Unif ied Patent Court can be accessed at: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2013:175:0001:0040:EN:PDF . 
236 The status of signature and acceptance of the Agreement can be viewed at European Commission 
online information: http://ec.europa.eu/internal_market/indprop/patent/ratification/index_en.htm . 
237 A detailed description of the "Enhanced European Patent System" is available at: http://www.unified-
patent-court.org/images/documents/e nhanced-european-patent-system.pdf .  
238 For the full text of the report see: http://www.unified-patent-
court.org/images/documents/implementing-second-%20package-report.pdf . 
239 Joined cases C-274/11 and C-295/11, For the full text of the CJEU decision see : 
http://curia.europa.eu/juris/document/document.jsf;jsessionid=9ea7d2dc30d68c78f91671744e61ae6ed21965
0b618b.e34KaxiLc3qMb40Rch0SaxuObh10?text=&doci d=137636&pageIndex=0&doclang=EN&mode=req&dir=
&occ=first&part=1&cid=237430 . WT/TPR/S/317 • European Union 
 
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  consequently seeking their annulment. Among others, Spain contested the delegation of powers to 
the EPO whose acts are allegedly not subject to judicial review.240 It also considered that the 
translation arrangements would infringe the principle of non-discrimination enshrined in EU law through the introduction of a scheme that disa dvantages persons whose mother tongue is not 
English, French or German.
241 In his opinion of 18 November 2014, the Advocate General 
recommended that both actions be dismissed by the CJEU.242 The CJEU ruling is expected in the 
first half of 2015. 
3.273.  Issues related to the patenting of biotechnolo gical inventions continue to play a key role in 
EU legislation and jurisprudence. As noted in the previous TPR report243, the Commission therefore 
decided to set up an expert group to assist it in preparing its annual reports on the development and implications of patent law in the fiel d of biotechnology and genetic engineering
244 as required 
under Directive 98/44/EC on the Legal Protection of Biotechnological Inventions.245 Following the 
appointment of members of the expert group in De cember 2013, the group has held nine meetings 
between December 2013 and February 2015.246 The two main topics of discussion are the 
patentability of human stem cells and of plant-related inventions. 
3.274.  In a preliminary ruling released on 18 December 2014247, the CJEU had an opportunity to 
further clarify the patentability of living material, here human stem cells, under Directive 
98/44/EC. Following the approach suggested in the Advocate General's opinion of 17 July 2014248, 
the Court held that unfertilized human eggs whose division and development have been stimulated 
by parthogenesis but which, in the absence of pate rnal DNA, are not capable of developing into a 
human being do not constitute a human embryo within the meaning of Article 6(2)(c) of Directive 
98/44/EC; as such, parthenotes are therefore not automatically excluded from representing a 
patentable subject matter. The Court thus qualified its earlier ruling in Oliver Brüstle v Greenpeace e.V. (Case C-34/10) which defined the concept of "human embryo" in a wide sense.
249 Through 
this important clarification, more stem cell technology is expected to become patentable in the EU. 
3.275.  Both under the EU Biotechnology Directiv e 98/44/EC and the European Patent Convention 
(EPC), plants are deemed patentable if the technica l feasibility of the invention is not limited to a 
variety that can be protected through plant variet y rights. In two decisions of 9 December 2010, 
the Enlarged Board of Appeal of the European Pate nt Office provided guidance on the conditions 
under which processes fall within the scope of exclusions from patentability as being essentially biological within the meaning of Article 53(b).
250 On the other hand, the patentability of products 
obtained by essentially biological processes has been confirmed by the Enlarged Board of Appeal. 
In two decisions of 25 March 2015, the Board found that the exclusion of essentially biological processes for the production of plants from pate ntability, pursuant to Article 53(b) EPC did not 
prevent a patent claim for products, such as fruits, seeds and parts of plants, directly obtained 
from such processes.
251 
                                               
240 OJEU C171/15, 15 June 2013. 
241 OJEU C171/16, 15 June 2013. 
242 See CJEU, Press Release No. 152/14 of 18 November 2014. Viewed at: 
http://curia.europa.eu/jcms/upload/docs/application/pdf/2014-11/cp140152en.pdf . 
243 WT/TPR/S/284/Rev.2, para. 3.266. 
244 For the full text of the decision, including the detailed mandate of the group see 
http://ec.europa.eu/internal_market/indprop/docs/invent/dec_121107_biotechinventexpertgroup_en.pdf   
245 OJEU L 213/13, 30 July 1998. 
246 The minutes of the meetings are available at: 
http://ec.europa.eu/internal_market/indprop/invent/index_en.htm#maincontentSec1 . 
247 Case C-364/13 (International Stem Cell Corporat ion v Comptroller General of Patents, Designs and 
Trade Marks). Viewed at: http://curia.europa.eu/juris/document/document.jsf?text=&docid=160936&pageIndex=0&doclang=en&mode=
lst&dir=&occ=first&part=1&cid=232540 . 
248 See CJEU Press Release No. 109/14 of 17 July 2014. Viewed at: 
http://curia.europa.eu/jcms/upload/docs/application/pdf/2014-07/cp140109en.pdf . 
249 See previous TPR report, WT/TPR/S/284/Rev.2, para.3.266. 
250 See Decision G 2/07, OJ EPO 3/2012, 130. Viewed at: 
http://archive.epo.org/epo/pubs/oj012/03_12/03_1302.pdf ; and Decision G 1/08, OJ EPO 3/2012, 206, viewed 
at: http://archive.epo.org/epo/pubs/oj012/03_12/03_2062.pdf . 
251 See Decisions G 2/12 (so-called "Tomato II" case). Viewed at: 
https://register.epo.org/application?documen tId=EXBZW10W4599684&number=EP00940724&lng=en&npl 
=false ; and G 2/13 (so-called "Broccoli II" case), viewed at: WT/TPR/S/317 • European Union 
 
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  3.276.  Of similar interest both for patent ri ghts and their enforcement are the developments 
regarding the interface between standards and patents. In his opinion of 20 November 2014, the Advocate General recommended that the CJEU deci de that, depending on the circumstances, the 
holder of a standard-essential patent may be required to make a specific licensing offer to the 
company that is infringing the patent concerned before seeking an injunction.
252 This requirement 
would apply in situations where the rightholder is in a dominant position and has made a commitment to the standards body to grant third parties a licence on fair, reasonable and non-
discriminatory terms and where the infringer is ready, willing and able to enter into such a 
licensing agreement. According to the Advocate Ge neral's opinion, seeking corrective measures or 
an injunction in such a situation would constitute an abuse of a dominant position. 
3.3.6.2.2  Supplementary Protection Certificates 
3.277.  Although closely related to, and conferring the same rights as the basic patent, 
supplementary protection certificates (SPCs) have been described by the Commission as a 
sui generis  IP category that only applies after expiry  of the basic patent. Making SPCs available 
aims to restore effective patent protection for certain regulated products; they are designed to 
compensate the rightholder for the time it takes from the filing of a patent application to the marketing authorization, and the potentially negative impact resulting from the reduction of the 
effective period of market exclusivity to recove r R&D investment. SPCs are available for medicinal 
products (Regulation (EC) No. 469/2009) and plant-protection products (Regulation (EC) 
No. 1610/96).
253 
3.278.  Among the relevant cases before the CJEU in the field of SPCs, the Court had an 
opportunity to further elaborate the conditions for obtaining an SPC for medicinal products under 
Regulation (EC) No. 469/2009 in two judgments issued on 12 December 2013. In the two cases concerned, the Court looked into the question as to whether more than one SPC could be obtained 
on the basis of the same patent and concluded that  there was no such general exclusion in EU law. 
The first case (C-484/12 - Georgetown University v Octrooicentrum Nederland
254) concerned the 
possibility of obtaining an additional SPC for individual active ingredients where, on the basis of a 
basic patent and a marketing authorization for a me dicinal product consisting of a combination of 
several ingredients, the patent holder had already obtained an SPC for that combination of active ingredients. In this regard, the Court held that "Article 3(c) of Regulation (EC) No. 469/2009 must 
be interpreted as not precluding the proprietor from also obtaining a supplementary protection 
certificate for one of those active ingredients which, individually, is also protected as such by that 
patent." 
3.279.  In the second case (C-443/12 - Actavis v Sanofi
255), the Court ruled that "where, on the 
basis of a patent protecting an innovative active ingredient and a marketing authorization for a 
medicinal product containing that ingredient as the single active ingredient, the holder of that patent has already obtained an SPC for that active  ingredient entitling him to oppose the use of 
that active ingredient, either alone or in combination with other active ingredients, Article 3(c) of 
Regulation (EC) No. 469/2009 […] must be interpre ted as precluding that patent holder from 
obtaining – on the basis of that same patent but a subsequent marketing authorization for a different medicinal product containing that active ingredient in conjunction with another active 
ingredient which is not protected as such by the patent – a second SPC relating to that 
combination of active ingredients."  
                                                                                                                                               
https://register.epo.org/application?doc umentId=EXBZX31D2974684&number=EP99915886&lng=en&npl 
=false .  
252 See CJEU Press Release No. 155/14 of 20 November 2014. Viewed at: 
http://curia.europa.eu/jcms/upload/docs/application/pdf/2014-11/cp140155en.pdf . 
253 For further details, please see previous TPR report, WT/TPR/S/284/Rev.2, para.3.268. 
254 Viewed at: 
http://curia.europa.eu/juris/document/document.jsf?text=&docid=145524&pageIndex=0&doclang=en&mode=
lst&dir=&occ=first&part=1&cid=157379 . 
255 Viewed at: 
http://curia.europa.eu/juris/document/document.jsf?text=&docid=145527&pageIndex=0&doclang=en&mode=
lst&dir=&occ=first&part=1&cid=157512 . WT/TPR/S/317 • European Union 
 
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  3.3.6.2.3  Plant Variety Rights 
3.280.  In the EU, plant varieties can be protec ted either under national plant variety right 
systems or as a Community Plant Variety Right. As regards the latter, Council Regulation (EC) No. 2100/94 of 27 July 1994 on Community Plant Variety Rights
256 established a separate regime 
for the protection of plant variety rights with effect across the EU.257 
3.281.  The Community Plant Variety Office (CPVO) was entrusted with the grant and 
administration of Community Plant Variety Rights. CPVO fees are frequently reviewed in order to 
guarantee a balanced budget of the Office and al so to maintain the regime's attractiveness. The 
following fees apply: €650 for an application; €1,430 to €3,210 for a technical examination, due per growing period and depending on the species to which the plant variety belongs; as well as an annual fee at a flat rate of €300 per variety and per year of protection. The fee for the proceedings 
before the Board of Appeal amount to €1,500.
 258 
3.3.6.2.4  Trademarks 3.282.  As set out in the previous TPR report, trademarks can be registered in the EU either under 
national trademark systems or as a Community trademark.
259 With respect to the former, Directive 
2008/95/EC260 codified EU rules providing for the harmonization of the main substantive provisions 
in national laws in order to ensure an equivalent level of protection in all EU member States. As 
regards the latter, Council Regulation (EC) No. 40/94 of 20 December 1993 on the Community 
trade mark, codified as Regulation (EC) No. 207/2009 of 26 February 2009 (the Community Trademark Regulation)
261, established a separate regime for the registration of unitary rights with 
equal effect throughout the EU. 
3.283.  The Office for Harmonization in the Internal Market (OHIM) was entrusted with the 
registration and administration of Community trad emarks. The time needed to process applications 
has been considerably reduced in recent years. In 2013, the objective of taking no more than 
23 weeks from reception of a direct application to  registration of a Community trademark was met 
in 92 to 99% of the cases; where an international application designating the EU was filed with WIPO, the objective of taking no more than 46 weeks to register a Community trademark was met 
in all cases.
262 Currently, for the registration of an individual trademark of up to three classes of 
goods and services, fees amount to €1,050, or €900  if the application is filed electronically. 
Renewal fees are €1,500 and €1,350, respectively . The basic fee for a collective mark is €1,800. 
The opposition fee is €350. 
3.284.  Against the background of steady growth in the role of trademarks for market success, as 
well as in their commercial value and number, the Commission had already foreshadowed its intention to review the trademark regime in its 2011 IPR strategy for Europe.
263 The envisaged 
purpose was to modernize the system, both at EU  and at national level, by making it more 
effective, efficient and consistent overall. Following up on this announcement, the Commission proposed, on 27 March 2013, a draft Regulation amending the Community Trademark Regulation 
and a draft Directive that recasts the afor ementioned Directive 2008/95/EC through the 
                                               
256 OJEU L 227/1, 1 September 1994. 
257 For a description of the protection of plant variety rights in the EU, see also the previous TPR Report, 
para.3.269, WT/TPR/S/284/Rev.2. 
258 For the applicable fees, see Commission Regulation (EC) No. 1238/95 as amended by Commission 
Implementing Regulation (EU) No. 1294/2014 of 4 December 2014, OJEU L349/30 of 5 December 2014. 
259 For more details, including the relationship between the Community trademark and national 
trademark systems, see WT/TPR/S/284/Rev.2, paras.3.271 to 3.273. 
260 OJEU L 299/25, 8 November 2009. 
261 OJEU L78/1, 24 March 2009. 
262 See the statistical data provided by OHIM. Viewed at: https://oami.europa.eu/tunnel-
web/secure/webdav/guest/document_l ibrary/contentPdfs/about_ohim/quality/external_service_standards_201
3_en.pdf . 
263 See the Communication on "A Single Market for Intellectual Property Rights: Boosting creativity and 
innovation to provide economic growth, high quality jo bs and first class products and services in Europe", 
COM(2011) 287 final of 24 May 2011, available at: http://ec.europa.eu/internal _market/copyright/docs/ipr_ 
strategy/COM_2011_287_en.pdf . WT/TPR/S/317 • European Union 
 
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  introduction of revised and a large number of new rules harmonizing national trademark laws.264 
These initiatives address a number of key issues that had been identified by a comprehensive external report released in 2011.
265 They respond to demands for a streamlined and more user-
friendly framework, including as regards registration and opposition procedures. Among others, 
the draft Regulation thus foresees that applications at EU level be centralized through the OHIM e-
filing system while suppressing the option of filing for EU-wide protection through national 
intellectual property offices. The draft Regulati on and Directive also aim at increasing legal 
certainty by updating certain provisions, clarifying ambiguities, as well as the scope and limitations 
of trademark rights, taking into account the extens ive CJEU case law. This includes, for example, 
the removal of the requirement of "graphic represen tability" from the definition of a trademark in 
order to clarify the coverage of non-traditional marks, such as mere sounds; the alignment of 
absolute grounds for refusal with relevant EU law on geographical indications and the inclusion of 
protected traditional terms for wine and traditional specialities in the grounds for refusal; as well as a clarification that infringement claims cannot be made against the use of an identical or similar 
sign that is covered by prior rights in order to br ing EU legislation in line with Article 16(1) TRIPS. 
Finally, the proposed package establishes a lega l framework for cooperation between national 
offices and OHIM. Following the adoption of a first reading position by the EP in February 2014 and 
a common position by the Council in July 2014, informal negotiations between the Commission, 
the EP and the Council started in November 2014 wi th a view to reaching an early second reading 
agreement on the whole package. 
3.285.  As regards the aim of providing a more effective basis for enforcing trademark rights by 
improving the means to combat counterfeit goods transiting the EU's territory, both Article 9(5) of 
the draft Regulation and Article 10(5) of the draft Directive propose that measures be made available to the rightholder in order "to prevent a ll third parties from bringing [counterfeit] goods, 
in the context of commercial activity, into the customs territory of the [Union][Member State 
where the trademark is registered] without being released for free circulation there,…". These substantive provisions complement the procedural rules on goods in transit, at least insofar as 
medicines are concerned, in Regulation (EU) No. 608/2013 that introduced revised enforcement 
measures at the EU's external borders.
266 It clarifies that, in the case of medicines merely 
transiting EU customs territory, "customs authorities should, when assessing a risk of infringement 
of intellectual property rights, take account of any substantial likelihood of diversion of such 
medicines onto the market of the Union."267 In other words, customs authorities should not detain 
medicines in transit if there is no indication for those medicines being directed towards the EU market.  
3.286.  
The Explanatory Memoranda accompanying the draft Community Trademark Regulation 
and the draft Directive explain the approach suggested here: they recall that the CJEU 
jurisprudence268 according to which goods could only be classified as counterfeit and as such be 
detained by Customs authorities if there is proof  that they are the subject of a commercial act 
directed at EU consumers, had been criticized by stakeholders for its implications on rightholders 
regarding the high burden of proof placed on th em and on the fight against counterfeiting more 
generally. Both Memoranda note the urgent need to put in place a legal framework that enables a 
more effective fight against counterfeit goods; cons equently, they propose to fill the existing gap 
by making the necessary tools available to rightholders in order to prevent third parties from 
bringing counterfeit goods into the EU customs te rritory, "regardless of whether they are released 
for free circulation".269 In other words, the proposed framework would only enable rightholders to 
take action against trademark-protected goods in transit to the extent that those are counterfeit; 
                                               
264 COM(2013) 161 final (viewed at: http://eur-lex.europa.eu/legal-
content/EN/ALL/?uri=CELEX:52013PC0161 ) and COM(2013) 162 final (viewed at: http://eur-
lex.europa.eu/legal-conten t/EN/ALL/?uri=CELEX:52013PC0162 ). 
265 See "Study on the Overall Functioning of the Euro pean Trade Mark System", Max Planck Institute for 
Intellectual Property and Competition Law, viewed at: http://ec.europa.eu/internal_market/indprop/docs/tm/20110308_allensbach-study_en.pdf . 
266 See below para. 3.304. 
267 See Recital 11 of Regulation (EU) 608/2013. 
268 Joined cases C-446/09 (Philips v LuchengMeijing) and C-495/09 (Nokia v Her Majesty's 
Commissioners of Revenue and Customs). For more details, see previous TPR report, WT/TPR/S/284/Rev.2, para. 3.303. 
269 See Explanatory Memorandum of the draft Community Trademark Regulation, Section 5.3., p.9, 
COM(2013) 161 final of 27 March 2013; Explanatory Memorandum of the draft Directive, Section 5.1., p.6, COM(2013) 162 final of 27 March 2013. WT/TPR/S/317 • European Union 
 
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  it would not cover goods transiting EU Customs territory that bear a trademark  that is confusingly 
similar to a trademark registered in the EU, nor would it apply to goods infringing, for example, 
patent or design rights. 
3.287.  Among the numerous judgments of the CJEU in the field of trademarks, the Court, in a 
preliminary ruling of 10 July 2014, pronounced itse lf on the scope of the aforementioned Directive 
2008/95/EC insofar as it concerned the registration of a three-dimensional trademark that consisted of the layout of a retail store.
270 In doing so, the Court first recalled the three conditions 
for a trademark application to be successful: in order to be registered, the trademark must thus 
(i) constitute a sign; (ii) be capable of graphic representation; and (iii) be capable of distinguishing the goods or services of one undertaking from those of other undertakings. The Court interpreted Directive 2008/95/EC as allowing a representation th at depicts the layout of a retail store to be 
registered as a trademark, provided that it has distinctive character. It considered that the 
registration of such a sign may extend to retail store services, as long as the latter do not form an integral part of the offer for sale of the goods concerned. 
3.288.  Another preliminary ruling of the CJEU a ddressed the issue of international exhaustion of 
trademarks and is therefore of significance  for the EU's trade with third countries.
271 In its 
judgment of 17 July 2014272, the CJEU confirmed its findings of 16 July 1998 in Silhouette 
International273 according to which the EU's trademark regime did not permit member States to 
provide for international exhaustion of trademarks. In addition, the Court held that this principle was neither affected by the EU's competition rules established in Articles 101 and 102 TFEU, nor by the GATT or the TRIPS Agreement, as Article 6 TRIPS did not provide any guidance regarding 
the application of the trademark exhaustion regime. 
3.3.6.2.5  Geographical indications 3.289.  According to the Commission, trade in products carrying a protected geographical 
indication (GI) is of significant economic relevance to the EU.
274 An external report, published by 
the Commission in March 2013275, found that, in 2010, 20% of all GI-protected products, worth 
about €11.5 billion, were exported outside the EU , mainly to the US; Switzerland; Singapore; 
Canada; China; Japan; and Hong Kong, China. As regards sales in the EU, sales of wines with a 
protected name represented €30.4 billion, followed by agricultural products and foodstuffs (€15.8 billion), spirit drinks (€8.1 billion) and aromatized wines (€31.3 million). Consequently, the then Commissioner for Agriculture and Rural Development estimated that EU GIs were worth 
€54.3 billion worldwide.
276 The study also concluded that the average value premium for GI-
protected products was more than double the value of similar products not bearing a GI. Another external study, also published by the Commission in December 2013
277, confirmed that, in most 
cases, GI-protected agricultural products and foodstuffs achieved a price premium over the 
standard products. This said, a 2014 study on the competitiveness of European wines278, found 
t h a t  E U  w i n e s  p r o t e c t e d  b y  G I s  a p p e a r e d  o n  f o r e i g n  m a r k e t s  w i t h  a  w i d e  r a n g e  o f  d i f f e r e n t  
acronyms; this generated confusion so that retail chains in third countries would not attribute 
much value to GIs. It therefore recommended to  use a single acronym on a worldwide basis for 
top range wines, and to introduce a country of origin indication for other wines. 
                                               
270 Case C-421/13 – Apple Inc. v Deutsches Patent- und Markenamt, available at: 
http://curia.europa.eu/juris/document/document.jsf?text=&docid=154829&pageIndex=0&doclang=en&mode=
lst&dir=&occ=first&part=1&cid=88161 .  
271 For a discussion of the EU's exhaustion regime, see WT/TPR/S/284/Rev.2, para.3.245. 
272 Case C-535/13 – Honda Giken Kogyo Kabushik i Kaisha v Maria Patm anidi, available at: 
http://curia.europa.eu/juris/doc ument/document.jsf;jse ssionid=9ea7d2dc30dddb089842c6d346f2a6f8cf67289
9d3c6.e34KaxiLc3qMb40Rch0SaxuPbhv0?text=&docid =155608&pageIndex=0&doclang=FR&mode=lst&dir=&oc
c=first&part=1&cid=157574 .  
273 Case C-355/96, available at: 
http://curia.europa.eu/juris/showPdf.jsf;jsessio nid=9ea7d2dc30d6d139f4c8f77748818a5aa2fccf0c9da5.e34Ka
xiLc3qMb40Rch0SaxuOaxv0?text=&docid=101178&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&par
t=1&cid=11497 .  
274 See previous TPR Report, WT/TPR/S/284/Rev.2, para.3.277, for more data. 
275 Available at: http://ec.europa.eu/agriculture/external-studies/value-gi_en.htm .  
276 See news item of 4 March 2013, viewed at: http://ec.europa.eu/agriculture/newsroom/106_en.htm .  
277 Available at: http://ec.europa.eu/agriculture/external-studies/added-value-pdo-pgi_en.htm .  
278 Available at: http://ec.europa.eu/agriculture/external-studies/2014/eu-wines/exec-sum_en.pdf . WT/TPR/S/317 • European Union 
 
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  3.290.  In the EU, there are three main approaches  for protecting GIs: as protected designations 
of origin (PDOs) or protected geographical indications (PGIs) for wine, spirits, and agricultural and foodstuff products (Table A3.6); as  collective Community trademarks
279; and through national 
appellation systems in EU member States. At EU level, unitary GI protection has been established 
for wines (1970), spirits (1989), aromatized wines (1991) and other agricultural products and 
foodstuffs (1992). Through these systems, protected names for the products covered enjoy far-reaching protection throughout the EU based on a single application process. The key provisions 
are laid down for wine in Regulati on (EU) No. 1308/2013 of 17 December 2013
280, for spirits in 
Regulation (EC) No. 110/2008 of 15 January 2008281, and for agricultural products and foodstuffs 
in Regulation (EU) No. 1151/2012 of 21 November 2012.282 
3.291.  The latter Regulation simplifies and stream lines the pre-existing regime and is aimed at 
encouraging the diversification of agricultural production, protecting product names from misuse 
and imitation and helping consumers providing information on product characteristics and farming attributes. It reinforces the existing scheme for PDOs and PGIs by a number of measures, 
including: faster registration procedures; clarification of the rules on controls; compulsory use of 
the PDO and PGI logos for products of EU origin from 4 January 2016 onwards; creation of a legal 
basis for inserting third country GI protected through bilateral agreements into the EU register, as 
well as of a legal basis for financing the defense of EU logos; and recognition of the role of 
producer groups. Traditional specialties guaranteed scheme (TSGs) is also simplified and strengthened, notably as in the future only the registration with reservation of a name will be possible. In order to qualify as "traditional", prov en usage on the market during at least 30 years 
(instead of 25) is now required. Finally, the Commission was requested to present two reports to 
the European Parliament and to the Council no later than in January 2014, one on the case for a new local farming and direct sales labelling scheme and the other on the case for a new optional 
quality term "product of island farming". Thes e reports were adopted on 6 and 12 December 2013 
respectively. They were transmitted by the Commission to the European Parliament and to the 
Council and discussed in the first half of 2014
. No follow-up in terms of legislative measures has 
been given to these reports. 
3.292.  Procedures for the application for registration of GIs originating in the EU have been 
described in previous reports283 and have not changed during the period under review except for 
the opposition period for agricultural products an d foodstuffs which has been reduced from six to 
three months. As regards GIs of products of non-EU origin, the application may be sent either 
directly, or through the authorities of the country where the geographical area is located, to the 
Commission. No  fees are required for applications from third countries. The average registration 
time for European and foreign GIs, including scrutiny, opposition procedures and procedures for 
the adoption of the final decision, was around  three years under the previous legislative 
framework. It is expected to become shorter with  the implementation of the new time limits for 
scrutiny and opposition procedures under Regulation (EU) No. 1151/2012 but the concrete impact of the new legislative framework remains yet to be assessed. 
3.293.  According to the Database of Origin and Registration (DOOR) for agricultural products and 
foodstuffs administered by the Commission, there are 17 third country names among the 1,206 GIs registered in the EU as of January 2015 (585 PDOs, 621 PGIs), including Café de 
Colombia and Darjeeling
284; 12 of which have been registered since 2011. DOOR is a transparency 
tool, but has no legal status. Registration with legal authority for PDOs and PGIs for agricultural products and foodstuffs is provided for by the Register of protected designations of origin and 
protected geographical indications (Article 11 of  Regulation (EU) No. 1151/2012). It lists two 
protected names for spirits from Guatemala and Peru. 
                                               
279 See explanation provided by the previous report, WT/TPR/S/284/Rev.2, paras. 3.287. 
280 OJEU L347/671, 20 December 2013. Viewed at: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:347:0671:0854:EN:PDF . 
281 OJEU L39/16, 13 February 2008. Consolidated version available at: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:2008R0110:20090120:EN:PDF . 
282 OJEU L343/1, 14 December 2012. Viewed at: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:343:0001:0029:en:PDF . 
283 Notably in the previous TPR Report , WT/TPR/S/284/Rev.2, paras. 3.280-3.281, pp. 99-100. 
284 DOOR online information. Viewed at: 
http://ec.europa.eu/agriculture/quality/door/list.ht ml;jsessionid=pL0hLqqLXhNmF QyFl1b24mY3t9dJQPflg3xbL2
YphGT4k6zdWn34!-370879141  [January 2015]. WT/TPR/S/317 • European Union 
 
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  3.294.  The wine register "E-Bacchus" is a database285 which includes the Register of designations 
of origin and geographical indications protected in the EU under Regulation (EU) No. 1308/2013. 
As of January 2015, 1,291 wine names qualified as PDO and 459 as PGI have been registered for EU wine, as well as two PDOs for third-country wine, i.e. Vale dos Vinhedos (Brazil) and Napa 
Valley (United States). The wine register also lists more than 1,100 third country geographical 
indications and names of origin protected in the EU in accordance with bilateral agreements on trade in wine that the EU has concluded with a number of trading partners. 
3.295.  Spirits bearing a GI are registered in A nnex III of Regulation (EC) No. 110/2008. "E-spirit 
Drinks"
286, a register of GIs protected in the EU for spirits originating in member States and third 
countries, listed a total of 343 protected names in January 2015. This includes 336 denominations registered in Annex III of Regulation (EC) No . 110/2008 of which two are third-country names 
(Ron de Guatemala (Guatemala) and Pisco (Peru)), as well as seven applications for registration, 
namely for Tequila (Mexico), Russian Vodka (Russian Federation), four Bulgarian Rakyas and Absinthe de Pontarlier (France). 
3.296.  Given the significant importance of GIs for the EU's external trade, the Commission has 
sought to include a comprehensive chapter on GI  protection in the more recent FTAs. A large 
number of EU and third-country GIs are thus prot ected through bilateral agreements that the EU 
has concluded with its trading partners.
287 The EU-Singapore Free Trade Agreement288 represents 
examples of an agreement for which negotiations were finalized in October 2014. Among others, upon entry into force of the FTA, Singapore will be required to put in place a domestic registration system for GIs. A list of 196 wines, spirits, as well as agricultural products and foodstuffs 
originating in the EU is entitled to the higher leve l of protection as provided for by Article 23 TRIPS 
once they have been applied for and registered in  Singapore. In August 2014, the EU also finalized 
negotiations of a Comprehensive Economic and Trade Agreement (CETA) with Canada.
289 Upon 
entry into force of CETA, Canada has, among others, committed to grant Article 23 TRIPS level of 
protection to the majority of a list of 145 names protected as GIs in the EU, subject to a partial 
exception for 21 names conflicting with names already in use in Canada.290 
3.297.  Furthermore, cooperation activities are being considered or carried out with a number of 
developing countries, such as in the framework of ECAP III with ASEAN countries.291 Under the 
EPA concluded with CARIFORUM, the establishment of a protection system for GIs is included. Also, the 2012 Memorandum of Understanding between the Commission and the African Regional 
Intellectual Property Organization (ARIPO)
292 aims at enhancing cooperation in order to support 
                                               
285 Accessible at: 
http://ec.europa.eu/agriculture/markets/wine/e-bacchus/index.cfm?event=pwelcome&language=EN . 
286 Available at: http://ec.europa.eu/agriculture/spirits/index.cfm?event=searchIndication . 
287 These include agreements with Albania (wine and spirits, 2006); Australia (wine, signed in 2008 and 
entered into force in 2010); Bosnia and Herzegovina (w ine, spirits and foodstuffs, 2008); Canada (wine and 
spirits, signed in 2003 and entered into force in Ju ne 2004); Chile (wine and spirits, 2002); Central America 
(wine, spirits and foodstuffs, signed in 2012 and provis ional entry into force in 2013); Colombia/Peru (wine, 
spirits and foodstuffs, signed in 2012 and entered into force in 2013), to be joined by Ecuador following agreement reached in 2014; former Yugoslav Republic of Macedonia (wine and spirits, 2001), Georgia (agricultural products and foodstuffs, signed in 2011 and entered into force in April 2012; now incorporated in 
the Association Agreement/Deep Comprehensive Free Trade Area which entered into force in 2014); Mexico (spirits, 1997); Moldova (agricultural products and foodstuffs, signed in 2012, entered into force in 2013; now incorporated in the Association Agreement/Deep Compre hensive Free Trade Area which entered into force in 
2014); Montenegro (wine, spirits, and foodstuffs, 2008), Repu blic of Korea (wines, spirits, foodstuffs, signed in 
October 2010 and entered into force in July 2011); Serbia  (wine, spirits, and foodstuffs; Stabilisation and 
Association Agreement entered into force in 2013); Switzerland (wines, spirits, and agricultural products, 2002); and Ukraine (wine, spirits, foodstuffs, signed  in 2014, entry into force pending). Although not 
specifically labelled as GI protection, the wine agreem ent concluded with the United States in 2006 establishes 
that names of origin are to be protected on a reciprocal basis. 
288 Viewed at: http://trade.ec.europa.eu/do clib/press/ind ex.cfm?id=961 . 
289 Text of the Agreement and ot her information available at: 
http://ec.europa.eu/trade/policy/in-focus/ceta/ . 
290 See Commission Summary of the Final Negotiating Results of December 2014. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2014/december/tradoc_152982.pdf . 
291 For details regarding the EU's technical cooperation ac tivities in the field of geographical indications, 
see the annual report submitted to the TRIPS Council in WTO Document IP/C/W/601/Add.7. 
292 European Commission Administra tive Memorandum of Understanding on cooperation between the 
African Regional Intellectual Property Organization and the Directorate General for Agriculture and Rural WT/TPR/S/317 • European Union 
 
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  the development of GIs. The EU subsequently organized, together with the African Union 
Commission, ARIPO  and OAPI (Organisation Africaine de la Propriété Intellectuelle), a series of 
eight workshops on "origin labelling and geographic al indications” designed to build capacity and 
help develop African GIs. 
3.298.  With respect to GI protection for non-agri cultural products, specific systems are currently 
operated by 15 member States. These laws take various forms, ranging from regional or national regulations on either specific crafts (e.g. ceramics) or all non-agricultural products to product-
specific laws (e.g. Solingen knives). Taking into account the current fragmentation of the legal 
framework and the potentially negative impact on the functioning of the Union market, the Commission, in its 2011 IPR strategy for Europe
293, had already announced its intention to proceed 
to a thorough analysis of the existing legal framework for GI protection for non-agricultural 
products in EU member States, and its implications for the Union market. Subsequently, an 
external study was published by the Commission in March 2013.294 It concluded that existing legal 
instruments available for producers at national and at European level were insufficient. Following a 
public hearing in April 2013, the Commission issued, on 15 July 2014, a Green Paper entitled 
"Making the most out of Europe's traditional know-how: a possible extension of geographical indication protection of the European Union to non-agricultural product."
295 The initial results of 
public consultations held from July to October 2014 were presented and further discussed at a 
conference organized by the Commission in Janua ry 2015. Based on the results of the public 
consultations, to be published in a detailed report in the first quarter of 2015, as well as the opinions issued by other EU institutions, the Commission will decide on how to proceed with this 
project.  
3.3.6.2.6  Industrial designs 3.299.  Next to the protection under the national design systems of EU member States or through 
international registration at WIPO
296, industrial designs can also be registered in the EU as a 
Community design at the OHIM under Council Regulation (EC) No. 6/2002 of 12 December 2001.
297 A Registered Community Design (RCD) is protected throughout the EU for a maximum 
period of 25 years. Registration and publicatio n fees amount to €350; renewal fees range from 
€90 (first time) to €180 (fourth time). By early 2015, about 830,000 RCDs have been registered by OHIM, and about 65,000 new designs are applied for each year. Next to registered designs, 
Regulation (EC) No. 6/2002 also provides for protection of unregistered Community designs for a 
period of three years from the date of making the design available to the public in the EU. 
3.3.6.2.7  Undisclosed information 3.300.  As stated in the previous TPR report
298, the protection of trade secrets is not harmonized in 
the EU. Major differences currently encountered in national laws, including with respect to the 
scope of protection and available remedies, have resulted in a fragmentation of the Union market 
that negatively affects cross-border collaboration299 and occasionally also impacts on FTA 
negotiations. Moreover, two external studies and the outcome of a public consultation300 confirmed 
the strategic importance of trade secrets as one of  the categories of IPRs most used by business, 
while noting the increase in the risk of their misappropriation over the last decade. Backed by 
these findings, the Commission presented, on 28 November 2013, a Proposal for a Directive on the 
Protection of Undisclosed Know-How and Business Information (Trade Secrets) Against Their 
                                                                                                                                               
Development of the European  Commission. Viewed at: http://ec.europa.eu/agriculture/developing-
countries/gi/memorandum-aripo/text_en.pdf . 
293 Viewed at: 
http://ec.europa.eu/internal_market/copyright/docs/ipr_strategy/COM_2011_287_en.pdf . 
294 Viewed at: http://ec.europa.eu/internal_market/indprop/docs/geo-indications/130322_geo-
indications-non-agri-study_en.pdf . 
295 Viewed at: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2014:469:FIN . 
296 For more details, see previous TPR Report, WT/TPR/S/284/Rev.2, paras.3.291 to 3.292. 
297 OJEU L 3/1, 5 January 2002. 
298 WT/TPR/S/284/Rev.2, para. 3.294. 
299 See Executive Summary of the Impact Asse ssment, Commission Staff Working Document 
SWD(2013) 472 final of 28 November 2013. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/ALL/?uri=CELEX:52013SC0472 .  
300 Studies and results of the public consultation are available at: 
http://ec.europa.eu/internal_market/iprenforcement/trade_secrets/index_en.htm . WT/TPR/S/317 • European Union 
 
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  Unlawful Acquisition, Use and Disclosure.301 With the aim of creating an innovation-friendly 
environment, the draft Directive proposes that different civil law regimes be harmonized at a minimum level, whilst allowing member States to apply stricter rules. To do so, a common definition of trade secrets in line with Article 39.2 TRIPS would be introduced and EU member 
States be obliged to make measures, procedures and remedies available to trade secret holders so 
that they can take action in order to either prevent or obtain redress for the unlawful acquisition, use or disclosure of their trade secret. The new set of rules is thus expected to make it easier for 
courts to deal with cases of misappropriation of trade secrets, to remove any infringing products 
from the market and for trade secret holders to obtain damages for illegal action. On 26 May 2014, the Council of the EU reached an agreemen t on a common position regarding an amended 
version of the draft Directive.
302 In October 2014, the Legal Affairs Committee of the European 
Parliament began examining the text. 
3.301.  The regime currently in force in the EU to protect clinical test data, and the approach taken 
by the European Medicines Agency (EMA) regard ing access to such data was set out in the 
previous TPR report.303 Since then, the issue of access to clinical trial information has been the 
subject of two important developments. On the le gislative side, Regulation (EU) No 536/2014 of 
the European Parliament and of the Council of  16 April 2014 on Clinical Trials on Medicinal 
Products for Human Use304 provides, among others, that a EU database be set up and maintained 
by the EMA with a view to ensuring an appropriate level of transparency in clinical trials. The EU database shall contain all information submitted in the clinical trials application and during the assessment procedure. In principle, this info rmation shall be publicly accessible unless the 
confidentiality of the information can be justified for any of the following grounds: protection of 
commercially confidential information; protection of personal data; protection of confidential information communication between member States in relation to the preparation of the 
assessment report; or the need to ensure effective supervision of the conduct of clinical trials by 
member States. In addition, the company or organization carrying out the clinical trials is obliged to submit to the EU database a summary of the results and a layperson summary within one year 
from the end of the trial in the EU. Where the trial was intended to be used for obtaining a 
marketing authorization, a full clinical study repo rt shall also be submitted to the EU database 
within 30 days after the grant of the marketing au thorization, the completion of the procedure for 
granting the authorization, or the withdrawal of the application.
305 
3.302.  In parallel, the EMA adopted, on 2 October 2014, its new policy on publication of clinical 
data for medicinal products for human use.306 The objective of facilitating public access to clinical 
trial data after completion of the marketing auth orization process is to respond to an increased 
demand for transparency, to allow researchers to reassess data, to avoid duplication of clinical 
trials and to foster innovation and the developm ent of new medicines. The policy extends, among 
others, to clinical data which are submitted, as of January 2015, as part of any new application for 
marketing authorization. The Terms of Use in Annex 1 specify, however, that the clinical reports 
may only be used for general information and non-commercial purposes; they may not serve to support an application for marketing authorization or any extension or variation thereof for a product anywhere in the world. Similarly, the user is prohibited from making any unfair 
commercial use of the clinical reports. 
3.303.  Pharmaceutical companies will thus be obliged to register clinical trials in the EU and 
results will be available to the public in accordance with the rules described above. The public 
disclosure of clinical trial data does not appear to affect the protection of such data against unfair 
commercial use in the EU, as they are covered by a regime of data exclusivity of up to 11 years 
during which no competitor can rely on the data in order to obtain marketing authorization. The 
impact of the EU database and the EMA policy on the protection of clinical trial data in third 
countries is, however, unclear at this stage. Once  published, they would no longer have to be 
considered as "undisclosed test or other data" within the meaning of Article 39.3 TRIPS and would 
                                               
301 COM(2013) 813 final, available at: http://eur-lex.europa.eu/legal-
content/EN/ALL/?uri=CELEX:52013PC0813 . 
302 See Council Press Release of 26 May 2014. Viewed at: 
http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/intm/142780.pdf .  
303 WT/TPR/S/284/Rev.2, paras.3.295 to 3.297. 
304 OJEU L158/1, 27 May 2014. 
305 See Article 37 of Regulation (EU) No.536/2014. 
306 Available at: 
http://www.ema.europa.eu/docs/en_GB/document_library/Other/2014/10/WC500174796.pdf .  WT/TPR/S/317 • European Union 
 
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  therefore not have to be protected by other WTO Members. The aforementioned Terms of Use 
according to which the user of the data agrees not to refer to them in support of an application for marketing authorization in third countries have, however, been designed to address this issue. 
3.3.6.3  Enforcement 
3.3.6.3.1  Legal basis at EU level 
3.304.  Enforcement of IPRs in the EU is base d on Directive 2004/48/EC on the Enforcement of 
IPRs (IPRED) and Directive 2001/29/EC on the Harmonisation of Certain Aspects of Copyright and 
Related Rights in the Information Society.
307 Since 1 January 2014, enforcement at the EU borders 
is governed by  Regulation (EU) No. 608/2013 of the European Parliament and of the Council and 
Commission Implementing Regulation (EU) No. 1352/2013.308 The new Regulation repealed 
Regulation (EC) No. 1383/2003. It expands the scope of IPR categories for which border measures 
are made available. To the extent that these are protected under national or EU law, trade names, 
topographies of semiconductor products and utility models are now also covered by the Regulation. Similarly, the unitary patent is included in its scope. In addition, the Regulation also 
applies to new types of infringement by extending to circumvention devices, as well as moulds or 
matrixes to manufacture IPR-infringing goods. These changes are accompanied by the introduction of simplified procedures for the rightholder to ta ke action against goods that are suspected of 
infringing IPRs. 
3.305.  Regulation (EU) No. 608/2013 also clarifie s the handling of medicines transiting the EU 
territory in order to address concerns regarding the impact on legitimate trade in generic medicines of provisions in the earlier Regula tion (EC) No. 1383/2003. As summarized in the 
previous EU TPR report
309, Brazil and India had both requested consultations in 2010 with the EU 
and the Netherlands regarding the Customs treatment of medicines in transit through EU ports, produced in India and destined for developing countries.
310 In line with the European Court of 
Justice judgment of 1 December 2011311 and the understanding subsequently laid down in 
Guidelines adopted by the Commission in February 2012312, Recital (11) of the Regulation sets out 
that "customs authorities should, when assessing a risk of infringement of intellectual property 
rights, take account of any substantial likelihood of diversion of such medicines [in transit] onto 
the market of the Union". In the absence of such  indicators, there would not be enough grounds 
for customs authorities to suspect an infringement of intellectual property rights merely because the generic medicines are transiting the EU.
313 Pursuant to Article 37, the Commission is also 
requested to submit a report on the implementation of Regulation (EU) No. 608/2013 by end 2016 
that is to cover any relevant incidents concerning medicines transiting EU Customs territory, including an assessment of the potential impact on its commitments on access to medicines under 
the 2001 Doha Declaration on the TRIPS Agreement and Public Health.  Without questioning the 
usefulness of clarifying the handling of medicines in  transit by EU Customs authorities, it needs to 
be relativized, namely by looking at the importance of goods in transit in the overall context: as 
Customs statistics for 2013 showed, detention of g oods in transit represented only 0.33% of the 
total number of actions undertaken by customs authorities at the EU's external borders.
314 
3.306.  In a judgment of 6 February 2014315, the CJEU had an opportunity to interpret the former 
Customs Regulation (EC) No. 1383/2003 with respec t to the circumstances under which trademark 
                                               
307 OJEU L 157/45, 30 April 2004; and OJEU L 167/10, 22 June 2001. 
308 OJEU L 181/15, 29 June 2013, also notified to the WTO in document IP/N/1/EU/E/1, 10 July 2013; 
and OJEU L 341/10, 18 December 2013. 
309 WTO document WT/TPR/S/284/Rev.2, para. 3.303. 
310 WTO documents WT/DS408/1 and WT/DS409/1, 19 May 2010. 
311 Joined cases C-446/09 (Philips v LuchengMeijing) and C-495/09 (Nokia v Her Majesty's 
Commissioners of Revenue and Customs). 
312 Guidelines of the European Commission concerning the enforcement by EU customs authorities of 
intellectual property rights with regard to goods, in pa rticular medicines, in transi t through the EU, available at: 
http://ec.europa.eu/taxation_customs/resources/documents/customs/customs_controls/counterfeit_piracy/legi
slation/guidelines_on_transit_en.pdf . 
313 For the link with the proposed Community Trad emark Regulation and draft Directive harmonizing 
national trademark laws see above, para. 3.285. 
314 See Table 3.24. 
315 Case C-98/13 (Martin Blomqvist v Rolex SA, Ma nufacture des Montres Rolex SA), available at: 
http://curia.europa.eu/juris/document/document.jsf;jsessionid=9ea7d2dc30ddc88b7757b4124b15b74c90c82dWT/TPR/S/317 • European Union 
 
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  owners may seek Customs action in order to stop (allegedly) counterfeit goods at the EU's external 
borders. The judgment can be expected to also affect the interpretation of the new Customs Regulation (EU) No. 608/2013. According to the Court, where such goods are sold to an EU 
resident through an online sales website in a third country, the rightholder enjoys the protection 
under the Customs Regulation when the goods conc erned enter the territory of a member State. 
For this to apply, an offer for sale or advertising that targets consumers in the member State concerned prior to the sale is not a prerequisite. As the case in question concerned the importation 
of a single item that was purchased through online cross-border sales for personal use, the Court's 
judgment appears to strengthen the rights of tradem ark owners insofar as they can take action to 
enforce their rights also with respect to goods imported for personal use. 
3.307.  An updated overview of the main enforcem ent provisions is provided in Table 3.23. The 
earlier responses provided by the EU to the TRIP S Council's Checklist of Issues on Enforcement
316 
also provide some useful background inform ation regarding the EU's framework for IPR 
enforcement.317 However, this information dates back to 1997 and needs updating in order to 
reflect a number of important legislative changes during the past 18 years. 
Table 3.23 Overview of selected IP enforcement measures 
Matter Key elements Brief description or quote from the 
relevant provisions  Legal basis or 
source 
General 
procedures and remedies  Has a distinct judicial system 
been established for the enforcement of IPRs (i.e. are there specialized courts, or chambers within courts for patent litigation or other IPR-related law suits)?  At EU level, there is no specific 
provision on the establishment of specialized judicial systems. This decision is left to member States Directive 
2004/48/EC on IPR Enforcement (IPRED) 
 Do judicial authorities have the 
authority to award injunctions 
against innocent infringers (i.e. 
those infringing without knowing 
or having reasonable grounds to 
know that their actions constitute 
infringement) or in the case of 
use by governments, or 
authorized by governments? 
 Yes, injunctions may be issued against 
any infringer. The Directive only 
distinguishes between innocent 
infringers and those that knowingly or 
with reasonable grounds to know 
engaged in an infringing activity, for 
damages. There are no specific 
provisions on any "use by governments 
or authorized by governments" Article 11 of 
Directive 
2004/48/EC  
 Is it possible to recover damages 
and/or lost profits in case of IPR infringement?  Yes Article 13 of 
Directive 2004/48/EC 
 May the authorities order the 
removal from the channels of 
commerce or the destruction of 
(i) infringing goods and (ii) the 
materials/instruments used to 
produce such goods? 
 Yes Article 10 of 
Directive 
2004/48/EC 
 Are courts authorized to order the 
infringer to inform the right holder of the identity of third persons involved in the production and distribution of the infringing goods?  Yes Article 8 of 
Directive 2004/48/EC 
 Do courts have the authority to 
order an applicant who has 
abused enforcement procedures 
to pay adequate compensation to 
the defendant? 
 Yes, including provisional measures Articles 7(4) 
and 9(7) of 
Directive 
2004/48/EC 
                                                                                                                                               
a8a96a.e34KaxiLc3qMb40Rch0SaxuPbhv0?text=&doc id=147506&pageIndex=0&doclang=en&mode=lst&dir=&
occ=first&part=1&cid=383526 .  
316 WTO document IP/C/5, 30 November 1995. 
317 WTO document IP/N/6/EEC/1, 13 February 1997. WT/TPR/S/317 • European Union 
 
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  Matter Key elements Brief description or quote from the 
relevant provisions  Legal basis or 
source 
Provisional 
measures  Under which circumstances and 
for what purposes may a judicial/ administrative authority authorize provisional measures in the area of intellectual property law?   Provisional measures are ordered by 
the competent authorities in order to prevent an imminent infringement of an IPR or to forbid the continuation of such an infringement Article 9(1) of 
Directive 2004/48/EC 
 After what time-period are 
provisional measures revoked, or 
otherwise cease to have effect, if 
proceedings leading to a decision 
on the merits of the case have 
not been initiated? Provisional measures are to be 
revoked if the applicant does 
not initiate proceedings 
leading to a decision on the 
merits of the case within a 
reasonable period of time to 
be determined by the judicial 
authority ordering the 
measure, or, in the absence of 
such determination, within a 
period not exceeding 
20 working days or 
31 calendar days Article 9(5) of 
Directive 
2004/48/EC 
Border measures  What types of goods may be 
subject to bord er enforcement 
procedures (e.g. goods infringing trademarks, copyrights, patents, GIs, etc.)?  Border measures apply to goods 
suspected of infringing a trademark, design, copyright or related rights, geographical indication, patent or utility model, supplem entary protection 
certificate, plant variety right, topography of semiconductor product, or trade name, as well as circumvention devices, products or components and moulds or matrixes to manufacture IPR infringing goods  Article 2 of 
Council Regulation (EU) No. 608/2013 
 Under what circumstances may 
the competent authorities act 
upon their own initiative – ex 
officio – to suspend the release of 
goods and, if they may do so, 
must the authorities notify the 
rightholder? 
 Ex officio action is possible where the 
customs authorities have sufficient 
ground for suspecting that goods 
infringe an IPR. The rightholder shall 
be informed in order to enable him to 
submit an application for action 
 Article 18 of 
Council 
Regulation 
(EU) 
No. 608/2013 
 Under what circumstances may 
the authorities allow the re-exportation of infringing goods in an unaltered state or subject goods to a different customs procedure?  Under no circumstances Article 25 of 
Council Regulation (EU) No. 608/2013 
Criminal 
procedures  What infringements of intellectual 
property rights are considered 
criminal offences (e.g. wilful 
trademark counterfeiting and 
copyright piracy on a commercial 
scale; other IPRs; etc.)? EU legislation covers only civil and 
administrative measures. Criminal 
procedures fall within the competence 
of EU member States See Article 
2(3) of 
Directive 
2004/48/EC for 
the definition 
of its scope in 
respect of 
criminal 
procedures and 
penalties; 
Article 1(6) of 
Regulation 
(EU) 
No. 608/2013 
which clarifies 
that member 
States' laws in 
relation to 
criminal 
procedures are 
not affected WT/TPR/S/317 • European Union 
 
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  Matter Key elements Brief description or quote from the 
relevant provisions  Legal basis or 
source 
 What type of criminal sanctions 
may be imposed?    
 Do private persons have standing 
to initiate criminal proceedings? 
   
 Is there a specialized law 
enforcement unit for IPR crimes? If so please share any information on its size and operational structure.   
Source: WTO Secretariat. 
3.3.6.3.2  IPR enforcement at the EU's external borders 
3.308.  At the external border of the EU, cust oms authorities may suspend the release of, or 
detain goods, that are suspected of infringing or found to have infringed IPRs. In most cases, 
customs authorities act upon applications from rightholders. However, customs may also act 
ex officio if they have sufficient grounds for suspec ting that goods infringe an IPR. In such cases, 
they will notify the detention/suspension to the importer within one working day and to the 
rightholder on the same day or promptly thereafter . The rightholder must submit an application for 
action within four working days of receiving the notification. If no application is submitted within this period, the goods are released. 
3.309.  Results of customs action are publis hed annually by the European Commission. In 
particular, the annual reports provide statistical information and data about customs interventions 
which support the analysis of IPR infringements occurring in the EU. According to the latest report
318, there were almost 87,000 cases of goods being detained by customs in 2013, which 
represents more than a 1,000% increase since 2001, due, among others, to internet sales. At the 
same time, a significantly lower number of articles  detained by customs could also be observed 
since the last report. In total, almost 36 million articles (as compared to more than 114 million 
articles in 2011) were detained, amounting to a dome stic retail value of the originator products of 
over €768 million (Table 3.24). Clothing accounted for about 12% of the articles detained, followed by other goods (11%), medicines (10%), cigarettes (9%) and packaging materials (8.8%). Due to detentions in the field of medicines, the share of products potentially harmful to 
human health and safety remained high, amounting to 25.2% in 2013. 
Table 3.24 Enforcement of intellectual property rights, 2011-13 
 2011 2012 2013 
Customs actions    
Applications by rightholders 20,566 23,134 26,865 
Number of cases 91,254 90,473 86,854 
Number of articles  114,772,812 39,917,445 35,940,294 
Domestic Retail Value (€) 1,272,354,795 896,891,786 768,227,929 
 
Breakdown of cases in 2013  (%) 
IP right in relation to detained 
articles Trademark 93.33 
Patent 2.41 
Design and model right 2.89 
Copyright/related right 0.94 
Results Destruction of goods 76.85 
Court case initiated 15.04 
No action undertaken 4.85 
Pending case 0.31 
Original goods 2.94 
Settlement out of court 0.01 
                                               
318 DG Taxation and Customs Union, Report on EU  Customs Enforcement of IPRs 2013. Viewed at: 
http://ec.europa.eu/taxation_customs/resources/documents/customs/customs_controls/counterfeit_piracy/stat
istics/2014_ipr_statistics_en.pdf . WT/TPR/S/317 • European Union 
 
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  Breakdown of cases in 2013  (%) 
Cases per procedure Imports 92.39 
Transit EU 4.88 
Transit 0.33 
Warehouse 1.00 
Transhipment 0.18 
Export 0.06 
Re-export 1.16 
Top 5 categories by articles Clothing 12.33 
Other goods 11.13 
Medicines 10.10 
Cigarettes 8.95 
Packaging material 8.83 
Source: European Commission (2014), Report on EU Cu stoms Enforcement of Intellectual Property Rights: 
Results at the EU Border – 2013. Viewed at: http://ec.europa.eu/taxation_customs/resources/documents/customs/customs_controls/counterfeit_
piracy/statistics/2014_ipr_statistics_en.pdf . 
3.310.  The close cooperation between customs and th e private sector is illustrated by the steadily 
increasing number of applications for action submitted by rightholders to customs, rising from 
2,888 in 2004 to 26,865 in 2013; only about 3% of interventions by customs were initiated ex officio. In 92% of the detentions, the goods were destroyed following either an agreement between the holder of the goods and the rightholder or the initiation of a court case by the 
rightholder to determine the infringement. In the remaining 8% of the cases, the goods were 
subsequently released because either the rightholder did not take action (4,9%) or the goods were found to be original (2.9%). In more than 92% of the cases, customs action began while the 
goods were under an import procedure; in almost  5%, goods were discovered while in transit to 
the EU, and only 0.33% of the cases concerned good s in transit to a declared destination outside 
the EU. 
3.3.6.3.3  IPR enforcement within the EU 
3.311.  The EU has several Directives containing ru les applicable to the (online) enforcement of IP 
rights, such as Directive 2004/48 (the Enforcement Directive), which establishes general applicable 
rules regarding IPR enforcement, and Directive 2000/31 (E-commerce Directive), which 
establishes minimum applicable rules regarding the conditional exemption of liability for internet 
service providers (ISPs). Certain flexibilities are left to member States in implementing these 
provisions. For example, in many member States, ISPs cannot store IP addresses for the specific 
purpose of online copyright enforcement; except ions include France. Consultations on the civil 
enforcement of IPRs within the Union market, incl uding the functioning and possible review of the 
Enforcement Directive, have been held by the Commission since 2011
319, but have not yet resulted 
in any concrete action or proposal. 
3.312.  On 1 July 2014, the Commission adopted a co mprehensive set of initiatives to be taken in 
2014-2015 in order to enhance the protection and enforcement of IPRs, composed of an EU Action Plan and a Strategy to promote enhanced enforcem ent standards in third countries which will be 
introduced in Section 3.3.6.3.4 below.
320 The package aims at ensuring the effective application of 
the existing framework to combat IPR infringement while acknowledging the need to take a balanced and proportionate approach in order to avoid the abuse of IPR enforcement measures for 
anti-competitive practices. The ten actions proposed by the EU Action Plan focus on commercial 
scale IP infringement in the EU. They include raising awareness of all stakeholders with respect to the economic impact of IP infringements, as well as the potential health and safety risks; 
promoting due diligence by all actors througho ut supply chains to reduce the risk of IP 
infringements; developing further voluntary Memo randa of Understanding to combat online IP 
infringements; assisting SMEs to enforce their IPRs; fostering cooperation among public authorities; and analysing trends in IP infringements, supported by a biennial report on the 
                                               
319 See previous TPR Report, WT/TPR/S/284/Rev.2, para. 3.307. 
320 COM(2014) 392 final (viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:52014DC0392&from=EN ) and COM(2014) 389 final (viewed at: 
http://ec.europa.eu/transparency/regdoc/rep/1/2014/EN/1-2014-389-EN-F1-1.Pdf ). WT/TPR/S/317 • European Union 
 
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  economic impact of the EU's IP policy to be pu blished by the Commission. Subsequently, the EU 
Action Plan was endorsed by the Council in its conclusions of 14 November 2014.321 
3.313.  As a first step toward implementation of the EU Action Plan, the Commission decided, on 
16 September 2014, to set up a Group of Experts on the enforcement of IPRs.322 Its aim is to 
ensure member States' involvement in the developm ent and implementation of the EU Action Plan, 
to share best practices and to enhance cooperat ion between competent national authorities and 
the Commission. 
3.314.  A 2011 Memorandum of Understanding on the sale of counterfeit goods over the internet 
established a code of practice designed to effect ively combat the sale of such goods, including 
through notice and take-down procedures, and to strengthen collaboration between the signatories.
323 Those include major internet platform providers, as well as rightholders from 
various industry sectors. The Commission presented a report on the functioning of the MoU in April 
2013, concluding that the MoU was working well, and also suggesting that it be continued for another two years and that its membership be extended.
324 It also expressed an interest in 
extending the MoU to operators from third countries. 
3.315.  Launched by the Commission in 2009 to address the steady increase in counterfeiting and 
piracy325, the European Observatory on Infringement of IPRs gathers and monitors information 
regarding counterfeiting and piracy on the EU's in ternal market, provides a platform to exchange 
experiences and share best practices in combat ing counterfeiting and piracy, raises public 
awareness and supports rightholders in protecting  their rights within and outside the EU. By 
means of Regulation (EU) No. 386/2012 of 19 April 2012326, the OHIM was subsequently entrusted 
with tasks related to IPR enforcement327, including assembling public and private sector 
representatives of the Observatory. In 2013, the Observatory was fully integrated into OHIM. As stipulated in the above-mentioned EU Action Plan and third country Strategy, the Observatory will 
also assist the Commission in carrying out the proposed set of actions to strengthen IPR 
enforcement. 
3.3.6.3.4  International cooperation in IPR enforcement 
3.316.  The Commission adopted, on 1 July 2014, a Communication on Trade, Growth and IP – 
Strategy for the Protection and Enforcement of IPRs in Third Countries that is designed to 
implement the EU Action Plan. It builds on and re views the approach of the earlier Strategy for the 
Enforcement of IPRs in Third Countries that was adopted by the Commission in 2004.
328 Among 
the relevant action points to be implemented by the Commission is the collection of data regarding 
the impact of IPR infringement, including through regular surveys of selected third countries of priority interest to the EU.
329 Furthermore, the Commission proposed that multilateral and 
plurilateral efforts to improve the existing international framework for the protection and 
enforcement of IPRs be continued alongside with th e inclusion of efficient IPR chapters in bilateral 
agreements, recognizing though that this will be a challenging task in many countries and that a 
more limited set of IPR provisions may need to be considered in the case of least developed and 
poorer developing countries. In parallel, IP dialogues with key third countries should be enhanced. The Commission also asked that better coherence between IPR and other policies be achieved; in serious cases of repeated violation of international commitments or lack of cooperation, this could, 
                                               
321 Council document 15321/14 of 10 November 2014. Viewed at: 
http://data.consilium.europa.eu/doc/document/ST-15321-2014-INIT/en/pdf .  
322 C(2014)6449 final, viewed at: http://ec.europa.eu/internal_market/iprenforcement/docs/expert-
group/setting-up-e xpert-group_en.pdf .  
323 See previous TPR report, WT/TPR/S/284/Rev.2, para.3.308. 
324 COM(2013) 209 final of 18 April 2013. Viewed at: http://eur-lex.europa.eu/legal-content/ 
EN/TXT/PDF/?uri=CELEX:52013DC0209&from=EN .  
325 See previous TPR Report, WT/TPR/S/284/Rev.2, para. 3.309. 
326 OJEU L 129/1, 16 May 2012. 
327 For the complete list of tasks see European Obse rvatory on Infringements of IPRs, Multiannual Plan 
2014-2018, Annex 1, available at: https://oami.europa.eu/ohimportal/en/web/observatory/about-us .  
328 Viewed at: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2005:129:0003:0016:EN:PDF .  
329 For the latest report, see Comm ission Staff Working Document SWD(2013) 30 final of 5 February 
2013. Viewed at: http://trade.ec.europa.eu/doclib/docs/2013/march/tradoc_150789.pdf .  WT/TPR/S/317 • European Union 
 
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  for example, lead to the restriction of participation in EU-funded programmes for third countries 
concerned. 
3.317.  The EU thus continues to fight against counterfeiting and piracy, both unilaterally, and 
through bilateral, regional, and multilateral agreements. Detailed IPR clauses, particularly on 
enforcement and border measures, are included in the newer generation of trade agreements 
concluded or negotiated by the EU, such as most recently the FTA with Singapore330 and the 
Comprehensive Economic and Trade Agreement with Canada331 for which negotiations were 
finalized in 2014; in most cases, these agreements provide for standards that go beyond the 
minimum level required by the TRIPS Agreement. As  regards other countries of key interest to the 
EU, such as Brazil, China, Indonesia, the Russian  Federation and Turkey, challenges and problems 
raised by EU rightholders are often addressed through structured IP dialogues or IPR Working 
Groups. In the case of China, this is complemented by a new Action Plan Concerning Customs 
Cooperation on IPR that was signed for the period 2014 to 2017 on 16 May 2014.332 Based on the 
Strategic Framework for Customs Cooperation 2014-2017333, it aims at promoting legitimate 
trade, among others, through the exchange of data and case-specific information, as well as 
enhanced cooperation between customs authorities and the private sector. 
3.318.  Based on the above-mentioned Regulation (EU) No. 386/2012, OHIM has also been tasked 
to build strategies and develop tools to enforce IPRs through international cooperation with IP 
offices in third countries, as well as to deve lop technical-assistance programmes for third 
countries. It operates as an implementing agency regarding projects and dialogues with third countries in the area of IPR enforcement initiate d by the Commission. In addition, OHIM has put in 
place its own cooperation programmes with IP offices in other countries, including Brazil, Mexico, 
the Russian Federation and Turkey. 
 
                                               
330 See Chapter 11, Sections C and D. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2013/september/tradoc_151761.pdf .  
331 See Chapter 22, Sections 3 and 4 of the consolidated text of 26 September 2014. Viewed at: 
http://trade.ec.europa.eu/doclib/docs/2014/september/tradoc_152806.pdf .  
332 Viewed at: 
http://ec.europa.eu/taxation_customs/resources/documents/customs/policy_issues/international_customs_agr
eements/china/action_plan_eu_china_ipr_2014_2017.pdf . 
333 Viewed at: 
http://ec.europa.eu/taxation_customs/resources/documents/customs/policy_issues/international_customs_agr
eements/china/stra tegic_framework.pdf . WT/TPR/S/317 • European Union 
 
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  4  TRADE POLICIES BY SECTOR 
4.1  Introduction 4.1.  This section covers agriculture, financial services, telecommunications, distribution services, 
and audiovisual services. To some extent, policies affecting these and other sectors are included in 
other sections such as tariffs, import and export licensing, taxes, and state aid, which are covered 
in Section 3. 
4.2.  In agriculture, the process of reform of the Common Agricultural Policy has continued with a 
significant reform to the system of direct payments, market measures, and rural development with 
full implementation starting in 2015. Within the new frameworks for direct payments and rural development, each member State has some limited flexibility to decide how to provide the support 
under the schemes and programmes set out in th e legislation. Although they may choose to 
provide some funds for production linked payments, the reform will continue the trend of declining 
support under the Amber and Blue boxes while increasing support under the Green Box. Within the EU, the reform will also lead to convergence in the level of support among the member States and, 
within each member State, among producers. As with earlier reforms, market access measures 
(tariffs, tariff quotas, and the special agricultur al safeguard) have not been directly affected. 
4.3.  In the aftermath of the global financial crisis, legislative reform affecting the financial sector, 
particularly prudential measures, has continued under three pillars: rules for global banking; rules 
aimed at establishing a safer and growth enhancing financial sector; and rules aimed at completing banking union to strengthen the Euro. Several directives and regulations have been introduced under each pillar with proposal s for more from the Commission. 
4.4.  In telecoms, the transposition into national laws of the regulatory framework described in 
previous Reviews has been completed while related rules have been adopted at the EU level. Further legislative changes under the Connected Continent Package were proposed by the 
Commission in September 2012 and are under discussion in the Parliament and Council. 
4.5.  Distribution services are one of the larges t services sectors in the EU with wholesale and 
retail trade accounting for over 11% of GDP and ne arly 15% of employment in the EU. The sector 
is characterized by increasing concentration and vert ical integration. To a large extent, distribution 
services are regulated by the member States through a combination of laws, including those relating to labour, competition, and establishment. However, several EU level laws are applicable, including the Services Directive and, in recognition of the importance of distribution services to the 
EU economy and to the operation of the internal market policy, further EU policies are currently 
being developed. 
4.6.  Audiovisual services along with other creative industries, contribute about 2.6% to the GDP 
of the EU. The principal rules regulating the sect or are the Audiovisual Media Services Directive 
and two communications from the Commission on control of state aid to public broadcasters, and supports for films and other audiovisual works. 
4.7.  Fisheries, environmental services, tran sport services, and pipelines services were 
comprehensively covered in the previous Review and are not included in this Section. For fisheries, the EU introduced a reform of the Common Market Organization from January 2014 through Regulation (EU) No. 1379/2013 repealing Regulation (EC) No. 104/2000 which will be covered in 
the next Review.  
4.2  Agriculture 4.2.1  Agriculture in the European Union 
4.8.  Agriculture's contribution to gross value added (GVA) in the EU has been stable at 1.4% in 
the period 2011-13, although its importance varies from one member State to another: from less than 1% in Belgium, Germany, Latvia, Luxembourg, Slovakia, Sweden and the United Kingdom; to WT/TPR/S/317 • European Union 
 
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  over 4% in Bulgaria, and Romania.1 In terms of employment, about 25 million people were 
regularly engaged in farm work in 2010, but agriculture was the main or full-time activity for less than half of this number. There were about 9.8 million full-time equivalent jobs (or annual work units (AWU)) in agriculture which represents 5% of total employment.
2 
4.9.  In most member States, agriculture production is dominated by family-owned farms where 
the holders and their family members account for nearly all of those working on farms. The situation varies from one member State to anothe r with the holder plus family members providing 
over 90% of work in Ireland, Malta, and Poland and non-family workers providing over half of work 
in the Czech Republic, France, and Slovakia. 
4.10.  In terms of gross output at basic prices, the value of agricultural production in the EU 
increased from 2010 to 2013, reaching €403 billion, before declining in 2014 to €392 billion. The 
changes in the value of production have been dr iven mostly by changes in prices rather than 
production. France is the biggest producer in the EU, followed by Germany, Italy, and Spain. In 2014, these four member States contributed nearly 54% to the total value of agricultural 
production in the EU. The total value of crop pr oduction in the EU in 2014 was €203 billion and the 
total value of production of animal products wa s €170 billion with wheat the main crop and milk 
the main animal product (Table 4.1).
3 
4.11.  According to the FAO, in 2012, in value terms, the EU was the second biggest producer, the 
second biggest exporter, and the biggest import er of agricultural products in the world.4 Clearly, 
developments in agricultural production and trade policies in the EU can have an impact on other countries. 
Table 4.1 EU-28, value of agricultural output, 2007-14 
 (€ billion) 
 2007 2008 2009 2010 2011 2012 2013 2014a 
All agriculture 353,342 372,678 330,970 353,801 386,692 397,559 402,896 392,281 
Crops 193,505 202,449 175,501 192,779 210,489 213,155 213,921 202,664 
   Cereals 49,922 52,538 36,060 45,426 56,165 59,926 53,848 49,581 
     Wheat 23,392 25,668 17,229 22,877 26,617 29,457 25,928 24,516 
   Wine 16,480 17,042 16,157 15,567 17,551 17,197 19,971 18,824 
   Fruit 22,403 23,836 21,404 22,695 23,078 22,284 24,927 22,463 
   Plants and flowers 20,110 20,557 19,740 20,548 20,267 19,969 20,191 20,231 
   Vegetables, 
horticulture 49,511 49,700 46,708 50,234 47,634 48,650 50,244 49,076 
     Fresh vegetables 29,401 29,143 26,968 29,685 27,367 28,681 30,054 28,845 
   Forage plants 21,739 24,682 25,440 25,367 28,333 27,178 27,202 27,091 
Animals and animal 
products 143,409 152,628 137,905 143,384 157,667 165,117 169,438 169,753 
   Animals 85,558 90,142 85,426 85,125 93,055 99,772 100,183 97,833 
     Cattle 30,398 31,039 28,442 28,447 31,062 33,628 32,767 31,983 
     Pigs 29,987 33,003 31,902 31,151 33,706 36,704 37,351 35,639 
     Poultry 16,090 17,624 16,659 17,140 19,145 20,350 21,302 21,296 
   Animal products 57,851 62,487 52,479 58,259 64,612 65,344 69,255 71,920 
     Milk  48,830 53,084 42,216 47,884 53,879 52,174 57,571 60,910 
a Values for 2014 estimated. 
Source: Eurostat online databa se (aact_eaa01). Viewed at: http://ec.europa.eu/eurostat/data/database  
[February 2015]. 
                                               
1 Eurostat online database. Viewed at: 
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database  [February 2015]. 
2 European Commission (2013), How many people work in agriculture in the European Union – An 
answer based on Eurostat data sources, EU Agricultural Economic Briefs, No. 8, July.  
3 Eurostat online database. Viewed at: 
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database  [February 2015]. 
4 FAOSTAT online database. Viewed at: http://faostat3.fao.org/home/E  [October 2014]. WT/TPR/S/317 • European Union 
 
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  4.2.2  Trade 
4.12.  Trade in agricultural products (WTO definition5) is important to the EU economy: 
contributing 6.6% to total goods exports and 5.5% to total imports in 2013. Since 2009, when exports and imports declined sharply compared to 2008, both recovered initially, but, while 
exports continued to grow steadily into 2013, imports have declined slightly compared to 2011 
(Chart 4.1). 
Chart 4.1 Exports and imports of  agricultural products, 2004-13 
0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%
020406080100120140160180200
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Exports of agricultural products Imports of agricultural products
Exports of agricultural products as a % of total exports Imports of agricultural products as a % of total imports(US$ billion) (% of extra EU trade)
 
Source: UNSD Comtrade. 
4.13.  The EU exports and imports a wide variety of agricultural products, although the main 
exports tend to be of processed products (with the exception of wheat) while imports tend to be of 
raw materials and animal feed. In 2013, exports of beverages, spirits, and vinegar (HS heading 
22) were particularly important with total exports of US$33.4 billion, representing over 20% of 
total agricultural exports. 
4.14.  In 2013, at the HS four digit level, the top three imports were coffee, oil-cake, and soya 
beans (Table 4.2). The main sources of imports of  coffee were Brazil, Swit zerland, Viet Nam, and 
Honduras; of oil-cake, Brazil and Argentina; and of soya beans, Brazil, the United States, and 
Paraguay. 
Table 4.2 Imports of agri cultural products, 2008-13 
HS 2002 Product  2008 2009 2010 2011 2012 2013 
 Total imports of 
agricultural products US$ million 126,692 105,888 110,634 134,575 129,835 133,320
0901 Coffee '000 tonnes 2,765 2,717 2,789 2,774 2,837 2,858
US$ million 8,247 7,338 8,750 13,112 11,749 9,843
2304 Oil-cake '000 tonnes 22,852 20,706 21,585 20,877 19,535 17,557
US$ million 9,709 8,497 8,457 8,938 9,584 9,677
1201 Soya beans '000 tonnes 14,425 12,903 13,469 12,149 12,122 12,938
US$ million 7,530 5,671 5,945 6,586 6,959 7,418
1511 Palm oil '000 tonnes 4,555 5,351 5,438 4,639 5,707 6,788
US$ million 4,389 3,716 4,206 5,034 6,004 6,010
0802 Other nuts, fresh or 
dried '000 tonnes 504 501 494 506 494 551
US$ million 2,837 2,450 2,827 3,257 3,211 4,024
0803 Bananas, including 
plantains '000 tonnes 4,925 4,592 4,601 4,712 4,618 4,915
US$ million 4,338 3,850 3,705 3,972 3,710 3,993
1801 Cocoa beans '000 tonnes 1,453 1,503 1,375 1,555 1,459 1,337
                                               
5 For the purposes of this Section, th e definition of agricultural products is that set out in Annex 1 of the 
Agreement on Agriculture where fish and fish products are taken to include HS Headings 020840, 03, 051191, 1504, 1603, 1604, 1605, and 230120. WT/TPR/S/317 • European Union 
 
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  HS 2002 Product  2008 2009 2010 2011 2012 2013 
US$ million 3,576 4,320 4,535 5,145 4,042 3,501
1005 Maize '000 tonnes 9,734 2,806 3,867 7,147 8,376 11,116
US$ million 2,983 870 1,032 2,294 2,528 3,391
2204 Wine of fresh grapes '000 tonnes 1,272 1,311 1,373 1,427 1,411 1,461
US$ million 3,621 3,254 3,140 3,330 3,210 3,272
2401 Unmanufactured 
tobacco '000 tonnes 597 613 597 630 639 597
US$ million 2,433 2,771 2,875 3,216 3,150 3,077
Source:  UNSD Comtrade. 
4.15.  In 2013, at the HS four digit level, the top three exports from the EU were distilled alcoholic 
beverages, wine, and wheat (Table 4.3). The main destinations for exports of distilled alcohol were 
the United States, Singapore, and the Russian Fede ration; of wine, the United States, Switzerland, 
Canada, and Japan; and of wheat, Algeria, Iran, Morocco, and Saudi Arabia. 
Table 4.3 Exports of agri cultural products, 2008-13 
HS 2002 Product  2008 2009 2010 2011 2012 2013 
 Total exports 
agricultural products US$ million 114,974 103,095 117,132 129,863 148,593 160,791
2208 Alcohol less than 
80% vol. '000 tonnes 1,122 1,039 1,183 1,376 1,441 1,484
US$ million 9,154 7,991 9,378 10,679 13,072 13,294
2204 Wine of fresh grapes '000 tonnes 1,799 1,665 2,085 2,331 2,272 2,074
US$ million 9,205 7,535 8,913 10,231 11,394 11,913
1001 Wheat and meslin '000 tonnes 18,185 20,603 22,285 17,488 16,187 25,108
US$ million 6,157 4,628 5,048 5,361 5,163 7,604
2106 Food preparations 
n.e.s. '000 tonnes 868 919 936 1,027 1,088 1,171
US$ million 4,725 4,750 4,676 5,115 5,592 6,425
1901 Malt extract '000 tonnes 701 726 818 942 1,040 1,104
US$ million 3,000 2,902 3,282 3,853 4,687 5,760
0203 Meat of swine '000 tonnes 1,230 1,008 1,260 1,588 1,557 1,609
US$ million 3,697 2,896 3,461 4,373 4,853 5,072
0406 Cheese and curd '000 tonnes 555 577 676 682 771 788
US$ million 3,781 3,301 3,948 4,051 4,632 5,024
1806 Chocolate, food prep 
with cocoa '000 tonnes 476 442 477 589 615 666
US$ million 2,848 2,633 2,913 3,379 4,032 4,459
0402 Milk, cream conc, 
containing sugar '000 tonnes 887 916 1,070 1,154 1,195 1,033
US$ million 3,445 2,350 3,393 3,804 3,845 4,172
1905 Bread, other bakers' 
wares '000 tonnes 642 648 729 793 884 940
US$ million 2,677 2,532 2,709 2,926 3,526 3,921
Source: UNSD Comtrade. 
4.2.3  Agricultural policies 
4.16.  Since the past Review of the European Un ion, the evolution of agricultural policy has 
continued with the adoption, in December 2013, of the basic regulations for a comprehensive 
package of reforms6, with most of the secondary regulations adopted in March 2014, and full 
application from 2015.7 However, up to the end of 2014, agricultural policy applied in the EU was 
essentially the same as outlined in the previous Secretariat report with transitional measures 
applying in 2014.8 The European Agriculture Guarantee Fund  (EAGF) covers direct payments and 
market measures, and the European Agricultural Fund for Rural Development (EAFRD) finances the EU contribution to rural development programmes. 
                                               
6 Regulations Nos. 1305/2013 on rural development, 1306/2013 on horizontal issues, 1307/2013 on 
direct payments, 1308/2013 on market measures , and 1310/2013 on transitional provisions. 
7 European Commission online information. Viewed at: http://ec.europa.eu/agriculture/cap-post-2013/  
[February 2015]. 
8 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013. WT/TPR/S/317 • European Union 
 
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  4.2.3.1  Domestic support 
4.2.3.1.1  Direct payments 4.17.  With the accession of Croatia to the EU , the number of member States that applied the 
Single Payment Scheme increased to 18
9, while the others continued to apply the Single Area 
Payment Scheme (SAPS).10 Payments under the Single Payment Scheme and the SAPS are not 
linked to prices or to production. Direct paymen ts linked to production applied only to suckler 
cows, sheep and goats, and (for four member States) cotton. Member States had some flexibility 
to direct some of the money available under direct payments to specific objectives and, for those 
member States that applied the SAPS, to provide complementary national direct payments (Table 4.4). 
Table 4.4 Direct payments to agricult ural producers in the EU, 2007/08-2011/12  
(€ million) 
 2007/08 2008/09 2009/10 2010/11 2011/12
Decoupled payments  
Single payment scheme, separate sugar payments 31,346 31,894 31,482 32,913 32,756 
Single area payment scheme 3,182 3,752 4,482 5,102 5,968 
Other direct aids      
Cereals, oilseeds, protein crops, grass silage and 
set-aside (including durum wheat, seeds, rice) 1,882 1,839 1,759 183 179 
Cotton 248 217 222 247 246 
Protein crops, olives, hops, legumes, energy crops 223 192 228 59 47 
Fruits and vegetables 0 301 317 211 71 
Bananas 277 278 275 278 277 
Beef, suckler cows 1,703 1,694 1,674 1,167 1,136 
Sheep and goats 404 397 415 127 127 
Dairy payments 4 3 0 0 0 
Article 69 specific supports, not decoupled as well as 
Article 68 of Regulation No. 73/2009 427 427 434 871 899 
Source: WTO notifications. 
4.18.  With the application of new rules on direct payments applying from 2015, transitional rules 
applied in 2014 under Regulation (EU) No. 1310/2013 which provided for a continuation of direct payments under the Single Payment Scheme and the SAPS and allowed member States to provide 
additional payments for the first hectares (up to 30 ha or the national/regional average). It also 
allowed member States to increase coupled specific support from 3.5% to 6.5% of their national ceilings. 
4.19.  The new direct payments scheme has applied since 1 January 2015 as set out in Regulation 
(EU) No. 1307/2013, and implementing legislation in Commission Regulations (EU) Nos. 639/2014, and 641/2014. Although, the net amounts for direct payments in each member 
State were initially linked to the previous system  of national envelopes, the new system includes 
convergence in support among member States, allows member States to divert some funding from rural development (EAFRD) to direct payments (and  vice versa), and provides some flexibility for 
funding various direct payment programmes (see Table 4.5 for the net amounts for direct 
payments in each member State). 
                                               
9 Austria, Belgium, Croati a, Denmark, Finland, France, Germany,  Greece, Ireland, Italy, Luxembourg, 
Malta, the Netherlands, Portugal, Slovenia , Spain, Sweden, and the United Kingdom. 
10 Bulgaria, Cyprus, the Czech Republic, Estonia, Hung ary, Latvia, Lithuania, Poland, Romania, and the 
Slovak Republic. WT/TPR/S/317 • European Union 
 
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  Table 4.5 Net amounts for direct payments, 2013-19 
(€ million) 
 2013 2014 2015 2016 2017 2018 2019
Belgium 569 544 524 510 502 489 482 
Bulgaria 582 644 721 789 790 791 793 
Czech Republic 903 875 840 839 839 857 857 
Denmark 964 926 870 852 834 826 818 
Germany 5,287 5,136 4,913 4,881 4,848 4,820 4,793 
Estonia 101 110 114 115 124 134 144 
Ireland 1,256 1,217 1,215 1,213 1,212 1,211 1,211 
Greece 2,345 2,235 2,110 2,087 2,064 2,043 2,022 
Spain 5,055 4,895 4,902 4,911 4,926 4,940 4,953 
France 7,853 7,359 7,302 7,271 7,239 7,214 7,190 
Croatia 95 164 183 202 240 278 316 
Italy 4,128 3,953 3,897 3,847 3,797 3,750 3,702 
Cyprus 54 51 51 50 50 49 49 
Latvia 146 156 181 206 230 255 280 
Lithuania 380 393 418 443 467 492 517 
Luxembourg 35 34 34 34 34 34 33 
Hungary 1,313 1,273 1,277 1,276 1,274 1,274 1,274 
Malta  6 5 5 5 5 5 5 
Netherlands 831 793 749 737 724 713 701 
Austria 716 694 693 692 692 692 692 
Poland 3,043 3,362 3,359 3,376 3,392 3,411 3,430 
Portugal 567 558 566 574 582 591 599 
Romania 1,265 1,429 1,600 1,773 1,801 1,873 1,903 
Slovenia 144 139 138 137 136 135 134 
Slovakia 386 435 436 439 442 445 449 
Finland 539 523 523 523 524 524 525 
Sweden 700 697 697 697 698 699 700 
United Kingdom 3,058 3,168 3,170 3,176 3,183 3,191 3,201 
Note: The crop specific payments for cotton are includ ed in the figures above. The figures are before the 
application of the financial discipline, and befo re the amounts of direct payments for POSEI 
(Programme d'Options Spécificques à l'Éloignement et l'Insularité (for the outermost regions of the 
EU)), and SAI (smaller Aegean Islands) in  Regulations (EU) Nos. 228/2013 and 229/2013. 
Source: For 2013 and 2014 - Council Regulation 73/2009, for 2015 to 2019 - Regulation (EU) No. 1307/2013 
(as last amended by Regulation (EU) No. 1378/2014). 
4.20.  Under the new system of direct payments, farmers may be eligible for payments under a 
number of different schemes including:  the Basic Payment Scheme (BPS) or the SAPS; agricultural practices beneficial for the climate and the environment (Greening); payments for young farmers; payments for areas with natural constraints; redistributive payments; and 
voluntary support coupled to production. With the exception of voluntary coupled support, 
eligibility under the BPS or SAPS is a precondition to qualifying for support under the other schemes.  
4.21.  The total amount each farmer receives under the various schemes may be higher or lower 
than the amount the farmer received before 2015. For certain small farms, member States may replace the different direct payment schemes with a simplified Small Farmer Scheme. All schemes 
of direct payments (except the Small Farmers Scheme) are subject to provisions to ensure 
compliance with basic standards relating to the environment, food safety, animal and plant health and animal welfare (cross-compliance
11). 
                                               
11 Regulation (EU) No. 1306/2013 on the financing, management and monitoring of the common 
agricultural policy, Regulation (EU) No. 640/2014 with regard to the integrated administration and control 
system and conditions for refusal or withdrawal of paym ents and administra tive penalties appl icable to direct 
payments, rural development support and cross-compli ance and Regulation (EU) No. 809/2014 laying down 
rules for the application of Regulation (EU) No. 1306/2013. WT/TPR/S/317 • European Union 
 
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  Basic Payment Scheme (BPS) 
4.22.  Under the BPS, eligible farmers must hold entitlements and activate them on a 
corresponding number of eligible hectares to receive payments. As a general rule, only those farmers who were entitled to receive direct paym ents in 2013 would be allocated entitlements in 
2015. However, other groups of farmers may be allocated entitlements, such as farmers starting 
agricultural activity and young farmers. A member State may also decide to limit the number of entitlements to be allocated, for example by lim iting the number of entitlements allocated to a 
farmer as the lesser of the number of eligible hectares in 2013 and 2015. 
4.23.  In general, each entitlement in a member State or region, should have the same value from 
2015 (the flat rate value) but member States may derogate from this rule provided the values of entitlements converge towards a flat rate by 2019.  Furthermore, where a member State decides to 
apply convergence, it must ensure that, by 2019, no farmer receives less than 60% of the national 
or regional average. In addition, payments  in excess of €150,000 under the Basic Payment 
Scheme are subject to reductions ("degressivity")  of at least 5%, unless the member State takes 
the option to provide redistributive payments (see below). 
4.24.  Based on the limits applying to each member State, and the requirements to provide 
minimum or maximum levels of funding for different schemes, the Commission sets annual 
national envelopes for the Basic Payment Scheme  which could be between about 25% and about 
70% of the national ceiling (Table 4.5) depending on how much the member State provides for other schemes of direct payments (Table A4.1). 
Agricultural practices beneficial for th e climate and the environment (Greening) 
4.25.  Each member State is required to allocate at least 30% of the national envelope for direct 
payments for payments for agricultural practices beneficial for the climate and the environment (Greening) (Table A4.1). To qualify for payments, three basic requirements must be met: 
(i) Crop diversification requirements apply to holdings which have more than 10 ha of arable 
 land: 
• For holdings of more than 30 ha, at least three crops must be cultivated, the main 
crop must occupy no more that 75% of  the arable area, and the two principal 
crops must occupy no more than 95% of the arable area; and  
• For holdings of 10-30 ha at least two crops must be cultivated, and the main crop 
must occupy no more than 75% of the arable area; 
 Or, more than 75% of land eligible for the BPS is permanent grassland, used to grow 
grass, or laying fallow, provided the remaining arable area is 30 ha or less; 
(ii) The ratio of the area under permanent grassland to total agricultural area in each member 
State or region must not decline by more than 5% compared to a reference based on 2012 
data. In addition, each member State is required to designate environmentally sensitive permanent grassland areas which may not be converted or ploughed; and 
(iii) Each holding must include an ecological focus area (EFA) of at least 5% (possibly 
increasing to 7%) of the arable area for a farm with an arable area of more than 15 ha which could include land left fallow, or land used for terraces, hedges, buffer strips, forestry, green cover, or nitrogen-fixing crops. 
4.26.  Alternatively, farmers meeting the requirements for organic production as set out in 
Regulation (EC) No. 834/2007 are deemed to be entitled to greening payments for the land under organic production. 
Redistributive payments 
4.27.  Each member State may provide up to 30% of its national envelope for redistributive 
payments. That is, by reducing the amount available for Basic Payments, they can increase WT/TPR/S/317 • European Union 
 
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  payments for the first 30 ha, or up to the average size provided the average size is greater than 
30 ha. Effectively, this would enable a member State to accelerate the process of convergence required under the BPS (Table A4.1). 
Young farmers' scheme 
4.28.  Each member State is required to reserve up to 2% of the national envelope for additional 
payments to young farmers (defined as 40 years old or less and setting up in farming for the first time as head of an agricultural holding) for a ma ximum period of five years. The actual period of 
eligibility for payments under the scheme depends on the date of setting up and the date of 
application, but cannot exceed five years. 
Coupled payments 4.29.  Under CAP Reform 2014-2020, crop-specific payments for cotton remain as set out in Table 
4.6. 
Table 4.6 Crop-specific payments for cotton 
 Area 
ha Fixed yield 
tonne/ha Payment 
€/ha 
Bulgaria 3,342 1.2 2015: 584.88 
2016 and onward: 649.45 
Greece 250,000 3.2 234.18 
Spain 48,000 3.5 362.15 
Portugal 360 2.2 228.00 
Source: Regulation (EU) No. 1307/2013, Article 58. 
4.30.  In addition, each member State may reserve up to 8% of the national envelope for coupled-
support (or more with Commission approval) to animals and/or specific crops plus an additional 
2% for protein crops. Subject to these limits, coupled support may be provided for cereals, 
oilseeds, protein crops, grain legumes, flax, hemp, rice, nuts, starch potatoes, milk and milk products, seeds, sheep meat and goat meat, beef  and veal, olive oil, silkworms, dried fodder, 
hops, sugar beet, cane and chicory, fruit and vegetables, and short rotation coppice (Table A4.1 
and Table A4.2). The Commission noted that coupled support is subject to additional 
requirements, including that it may only be granted to the extent necessary to create an incentive to maintain current levels of production in the sectors or regions concerned and that it is an annual 
payment, granted within defined limits and based on fixed areas and yields or on a fixed number 
of animals. 
4.2.3.1.2  Internal market support measures 
4.31.  For the purposes of this section, internal market support measures are defined as those that 
work inside the customs territory of the EU to in crease prices through reduced production or other 
supply control measures, or by encouraging cons umption. Market access and export measures, 
which can also lead to positive transfers to producers through higher domestic prices, are dealt 
with below under export subsidies and market access. 
4.32.  For the period 2012-2014, there have been few changes to the internal market support 
programmes in the EU. Intervention and/or privat e storage aids have been available for common 
wheat, durum wheat, maize, barley, sorghum, paddy rice, butter, skimmed milk powder, olive oil, 
beef, pig meat, and sheep and goat meat, subject to various controls and limits, including production quotas for milk and sugar.
12 In practice, no purchases into intervention took place 
during marketing years 2010/11 to 2013/14 and the use of private storage aids has remained 
limited (Table 4.7). 
                                               
12 WTO document WT/TPR/S/284/Rev.2 of 28 November 2013, section 4.1.3.1. WT/TPR/S/317 • European Union 
 
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  Table 4.7 Intervention and private storage aids in the EU, 2009/10-2013/14  
Marketing year  2009/10 2010/11 2011/12 2012/13 2013/14
Wheat           
Intervention price €/tonne 101.31 101.31 101.31 101.31 101.31 
Purchases tonnes 240,974 0 0 0 0 
Sales tonnes 23,806 231,866 38,946 0 0 
Barley           
Intervention price €/tonne 101.31 101.31 101.31 101.31 101.31 
Purchases tonnes 5,212,913 0 0 0 0 
Sales tonnes 659,578 4,982,192 398,623 0 0 
Maize           
Intervention price €/tonne 101.31 101.31 101.31 101.31 101.31 
Purchases tonnes 0 0 0 0 0 
Sales tonnes 354.243 214.586 0 0 0 
Sugar           
Reference price 
white sugar €/tonne 404.40 404.40 404.40 404.40 404.40 
Purchases  tonnes 0 0 0 0 0 
Sales  tonnes 35,000 0 0 0 0 
Private storage 
aids (entry)  tonnes 0 0 0 0 0 
Calendar year   2010 2011 2012 2013 2014
Butter           
Intervention price €/tonne 2,217.51 2,217.51 2,217.51 2,217.51 2,217.51 
Purchases tonnes 0 0 0 0 0 
Sales tonnes 75,000 1,500 0 0 0 
Private storage 
aids (entry) tonnes 97,000 104,000 131,000 89,449 22,394 
Skimmed milk 
powder           
Intervention price €/tonne 1,698.00 1,698.00 1,698,00 1,698,00 1,698,00 
Purchases tonnes 0 0 0 0 0 
Sales tonnes 65,000 145,000 50,000 0 0 
Private storage 
aids (entry) tonnes n.a. n.a. n.a. 0 17,342 
Olive oil           
Private storage 
aids (entry) tonnes   44,337 200,000 0 0 
Cheese       
Private storage 
aids (entry) tonnes n.a. n.a. n.a. 0 51,909 
Beef           
Intervention 
trigger price €/tonne 
2 weeks 1,560.00 1,560.00 1,560.00 1,560.00 1,560.00 
Public intervention tonnes 0 0 0 0 0 
Private storage 
aids (entry) tonnes 0 0 0 0 0 
Pig meat          
Private storage 
aids (entry) tonnes 0 141,023 0 0 0 
Sheep and goat 
meat          
Private storage 
aids (entry) tonnes 0 0 0 0 0 
n.a. Not applicable. 
Source: European  Commission. 
4.33.  Under CAP Reform 2014-20, the new rules on the common organization of the markets are 
set out in Regulation (EU) 1308/2013 plus a consider able body of implementing legislation, some 
of which refers to the detailed operation of internal market support measures, but much of which relates to the establishment of standard import values, entry prices, representative prices, or 
import duties and other market access measures (including the administration of tariff quotas) on 
a wide variety of products.  
Intervention and private storage aids  
4.34.  Under Regulation (EU) 1308/2013, public intervention (where the member State takes 
ownership of the product) may be used for common wheat, durum wheat, barley, maize, paddy WT/TPR/S/317 • European Union 
 
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  rice, fresh or chilled beef and veal, butter, and skimmed milk powder. Private storage aids (where 
a private company takes ownership and has a storage contract with the authorities of the member State) may be used for white sugar, olive oil, fl ax fibre, fresh or chilled beef, butter, cheese, 
skimmed milk powder, pig meat, and sheep meat and goat meat.
13 As in the past, the use of 
either public intervention or private storage aids  is usually discretionary: only for common wheat, 
butter, and skimmed milk powder is it required and then for a limited period for specified maximum quantities (Table 4.8). In most cases, the intervention prices and limits were not 
changed by the reform – except that the limit for butter purchases was increased from 30,000 to 
50,000 tonnes while the period for buying-in butter and skimmed milk powder was increased from six to seven months (it now ends on 30 September). Furthermore, mature cheese and flax fibre have been added to the list of products eligible for private storage aids 
Table 4.8 Intervention and private storage aid, 2015
 
Intervention Intervention price
€/tonne Period Limits 
Common wheat 101.31 1 Nov–31 May 3,000,000 
Durum wheat 101.31 1 Nov–31 May 0 
Barley 101.31 1 Nov-31 May 0 
Maize 101.31 1 Nov – 31 May 0 
Paddy rice 150.00 1 Apr– 31 Jul 0 
Beef and veala 1,890.40 All year 0 
Butterb 2,217.51 1 Mar – 30 Sep 50,000 
Skimmed milk powder 1,698.00 1 Mar – 30 Sep 109,000 
Private storage aid    
Reference price
€/tonne 
White sugar 404.40 
Raw sugar 335.20 
Olive oil  
  Extra virgin 1,779.00 
  Virgin 1,710.00 
  Lampante (2 degrees) 1,524.00 
Butter 2,217.51 
Cheese .. 
Skimmed milk powder 1,698.00 
Pig meat 1,509.39 
Sheep and goat meat .. 
Flax fibre .. 
.. Not available. 
a The reference price for beef and veal is fixed at €2,224 per tonne and the public intervention price is 
85% of the reference threshold (Articles 7.1(d) and 13.1(c) of Regulation (EU) No. 1308/2013). 
 b The reference price for butter is €246.39 per 100 kg and the public intervention price is 90% of the 
reference price (Article 7.1(e) of Regulation (EU) No. 1308/2013 and Article 2.1(d) of Council Regulation EU No. 1370/2013). 
 Source: Regulation (EU) No. 1308/2013 and Council Regulation (EU) No. 1370/2013. 
Market disturbance 
4.35.  In addition to public intervention an d private storage aids, CAP Reform 2014-2020 also 
established a reserve to address threats of market  disturbance (crisis reserve) of €400 million in 
2011 prices (€424 million in 2014). The fund is financed through reductions in direct payments although any unused amount is added to the following year's budget for direct payments. 
4.36.  Threats of market disturbance are those "caused by significant price rises or falls on internal 
or external markets or other events and circumst ances significantly disturbing or threatening to 
disturb the market where that situation, or its effects on the market, is likely to continue or 
                                               
13 The basic rules on intervention and private storage aids are in Regulation (EU) No. 1308/2013. More 
details are set out in Council Regulation (EU) No. 1370/2013 and, Commission Delegated Regulation (EU) 
No. 906/2014 for public intervention, and Commission Delegated Regulation (EU) No. 501/2014 for private 
storage aids. WT/TPR/S/317 • European Union 
 
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  deteriorate." In such circumstances the Commission may take measures to address the situation, 
"while respecting any obligations resulting from international agreements."14 
4.37.  For measures to address foot-and-mouth disease the EU is to provide 60% of the total 
funds, for other measures relating to disease cont rol or loss of consumer confidence due to public, 
animal or plant health risks the EU is to provide 50%. Other measures which may be taken to 
react to severe imbalance in markets include intervening in the market to reduce supply (market withdrawal, private storage, production planning), divert production (transformation, and 
processing), increase consumption (free dist ribution, and promotion), address consumer 
confidence (quality requirements), and measures to  address the spread of pests and diseases or 
the effects of natural disasters. 
4.38.  In addition to the general rules on crisis management, specific rules also apply in the event 
of crises in the fruit and vegetables, and wine sectors. 
Fruits and vegetables 4.39.  Producer organizations remain the focus of support for the fruits and vegetables sector. To 
receive funding, a producer organization must be  recognized by the authorities of the member 
State by meeting criteria, including a three to five year operational programme that meets some of the objectives set out in Regulation (EU) No. 1308/2013, Article 33. The operational programme 
should be funded by an operational fund financed  by contributions from the member States or the 
producer organization itself, with EU assistance limited to 50-60% of the total fund, and at least 
10% of spending under an operational programme must cover environmental actions. EU funding 
is also limited to 4.1-4.6% of th e value of marketed production of each producer organization or 
up to 4.7% for associations of producer organizations. 
4.40.  EU funding may be increased to 100% of the total fund for market withdrawals when the 
products are disposed of for free distribution to charities and foundations for food aid or for 
distribution to penal institutions, schools, hospitals, etc., up to a maximum of 5% of the volume of 
production marketed by the producer organizati on. In addition, the School Fruit Scheme, which 
provides fruit and vegetables to school children, is to continue. A total of €90 million was allocated 
to the scheme in 2012/13 and 2013/14 at co-financing rates that varied from 50 to 75%.
15 For 
2014/2015 the final allocation was €150 million at co-financing rates of 75 to 90%.16 Finland, 
Sweden, and the United Kingdom do not participate in the Scheme. 
4.41.  Member States may contribute up to 80% of the cost of establishing a producer 
organization's operation fund in cases where there are low levels of organization among producers 
(National Financial Assistance). Up to 60% of the national financial assistance may be reimbursed by the EU when: (i) the market share of producer organizations in the region is less than 15% of 
the value of fruit and vegetable production; and ( ii) fruit and vegetable production represents 15% 
or more of the total value of agricultural output. 
Dairy 
4.42.  As envisaged under earlier reforms of the CAP, the quota regime for milk production expired 
in April 2015. For 2013/14 marketing year, the total quota for the EU was 151 million tonnes while actual deliveries were 144 million tonnes. In Germany, the Netherlands, Poland, Denmark, Austria, Ireland, Cyprus, and Luxembourg deliveries were in excess of quotas. Among the other 
20 member States, which had deliveries less than their national quotas, 14 were more than 10% 
below quota. Levies of €27.83 per 100 kg are applied to production in excess of the quota. 
                                               
14 Regulation (EU) No. 1308/2013, Article 219. 
15 DG Agri online information. Viewed at: http://ec.europa.eu/agriculture/newsroom/111_en.htm  
[November 2014]. 
16 DG Agri online information. Viewed at: http://ec.europa.eu/agriculture/newsroom/163_en.htm  
[November 2014]. WT/TPR/S/317 • European Union 
 
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  4.43.  In the 12 months to July 2013, €198.5 million was spent on the School Milk Scheme 
(€66.7 million from the EU plus €131.8 million by the member States) for 304,421 tonnes of milk.
17 
4.44.  As reported in the last Trade Policy Review of the EU, the Milk Package was agreed in 
December 2011 and formalized in March 2012. Under the Package, member States may make it 
compulsory for farmers and processors to have written contracts. The Package also allows farmers to negotiate collectively with processors with limits on the amount of milk subject to such 
negotiations: the limits are 3.5% of EU production , or 33% of national production in the member 
State, or 45% for a member State with production of less than 500,000 tonnes. Twelve member States made contracts compulsory, in six member States a total of 228 producer organizations have been recognized and in four member States producer organizations have 
negotiated contracts covering between 4% and 33 % of milk deliveries. The Package also allows 
member States to regulate the supply of cheeses with protected designations of origin (PDO) or protected geographical indications (PGI).
18 
Other 
4.45.  The system of annual production quotas for sugar, currently 13.3 million tonnes, is to come 
to an end in September 2017 along with the minimu m price system for sugar beet, currently set at 
€26.29 per tonne, although sugar will remain eligible for private storage aids (see above). To 
strengthen the bargaining position of sugar growers, Regulation (EU) No. 1308/2013 requires 
written contracts between sugar producers and processors. 
4.46.  At the end of 2015, the existing system of planting rights for vineyards will cease and be 
replaced by a system of authorizations for vine plantings to run from 2016 to 2030. Under the new 
system of authorizations, new plantings are limited to a growth of 1% per year compared to the e x i s t i n g  t o t a l  v i n e  a r e a  i n  e a c h  m e m b e r  S t a t e .  I n  a d d i t i o n  t o  n a t i o n a l  s u p p o r t  m e a s u r e s  t h a t  
existed before end 2014, member States may also support the cost of providing information on 
responsible consumption of wine and the EU syst ems of PDOs and PGIs, as well as support for 
replanting of vineyards followin g mandatory grubbing-up for health or phytosanitary reasons, and 
the development of innovative products, processes, and technologies related to the wine sector.
19 
4.2.3.1.3  Rural development 4.47.  The reform of Pillar II of the CAP, on rural development, is set out in Regulation (EU) 
No. 1305/2013 and secondary legislation on its implementation.
20 According to the Commission, 
the structure and key characteristics of rural development policy have not been affected by the 
reform, because, as in the past, it will be im plemented through national and/or regional rural 
development programmes.21 The objective of the reform is, during the programming period 
2014-20, to give member States more flexibility to develop policies and measures to address their 
particular situations while ensuring a consistent approach for the implementation of measures supported by the European Agricultural Fund for Rural Development (EAFRD).
22 These 
programmes and measures will be co-funded at rates that vary depending on the type of project 
and the member State.23 Therefore, total spending on rural development will be higher than the 
                                               
17 DG Agri (2014), Intervention Report 2013,  6 November. Viewed at: 
http://ec.europa.eu/agriculture/milk-market-observatory/pdf/intervention-report-2013_en.pdf  
[November 2014]. 
18 Regulation (EU) No. 261/2012, Commission Implementing Regulation (EU) No. 551/2012, and 
Commission Delegated Regulation (EU) No. 880/2012; and European Commission online information. Viewed at: http://ec.europa.eu/agriculture/milk/milk-package/index_en.htm  [November 2014]. 
19 Commission Delegated Regulation (EU) No. 612/2014. 
20 See Commission Delegation Regulations (EU) Nos. 807/2014 and 994/2014, Commission 
Implementing Regulation (EU) No. 808/2014, and European Union Guidelines for State aid in the agriculture and forestry sectors and in rural areas 2014 to 2020. 
21 European Commission (2013), Overview of CAP Reform 2014-20,  Agricultural Policy Perspectives 
Brief, No. 5 December, p. 9. 
22 DG Agri online information. Viewed at: http://europa.eu/rapid/press-release_MEMO-14-180_en.htm  
and http://europa.eu/rapid/press-release_MEMO-13-621_en.htm  [November 2014]. 
23 Details on the levels and/or rates of co-financing are set out in Annex II of Regulation (EU) No. 
1305/2013. WT/TPR/S/317 • European Union 
 
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  national envelopes for each member State (Table 4.9) due to the national and/or private 
contributions. 
4.48.  Although the general objective of Pillar II is rural development, some of the programmes 
and measures permitted under Regulation (EU) No. 1305/2013 are targeted at farmers and 
intended to improve efficiency (e.g. investments in physical assets), productivity in the sector 
(e.g. aid for young farmers), and risk reduction (e.g. aid for restoring production potential after damage by natural disasters, subsidies for insurance premiums, and income stabilization). 
4.49.  As provided in Articles 48 and 49 of Regu lation No. 1307/2013, up to 5% of the national 
envelope for direct payments may be reserved for additional payments to farmers operating in areas with natural constraints as designated by each member State under rural development. " A r e a s  o f  n a t u r a l  c o n s t r a i n t s "  ( A N C ) ,  p r o v i d e d  f o r  i n  A r t i c l e s  3 2  a n d  3 3  o f  R e g u l a t i o n  ( E U )  
No. 1305/2013, replace the former "less favoured areas" whose designation among member 
States had been found to be inconsistent by the European Court of Auditors in 2003.
24 
Table 4.9 National envelopes for rural development, 2014-20 
(€ million) 
 2014 2015 2016 2017 2018 2019 2020
Belgium 78 78 91 97 97 103 103 
Bulgaria  335 335 337 340 340 340 339 
Czech Republic  314 313 346 345 343 323 322 
Denmark  90 90 136 145 153 152 152 
Germany  1,221 1,220 1,407 1,404 1,401 1,398 1,395 
Estonia  104 104 111 123 126 127 129 
Ireland  313 313 313 313 313 313 313 
Greece  605 605 705 703 702 700 698 
Spain  1,187 1,186 1,187 1,186 1,184 1,183 1,183 
France  1,405 1,636 1,663 1,666 1,668 1,671 1,675 
Croatia  332 282 282 282 282 282 282 
Italy  1,480 1,483 1,491 1,493 1,496 1,499 1,502 
Cyprus 19 19 19 19 19 19 19 
Latvia 138 151 153 155 157 159 161 
Lithuania  230 230 230 230 230 230 230 
Luxembourg 14 14 14 14 14 14 15 
Hungary 496 495 489 489 488 487 487 
Malta  14 14 14 14 14 14 14 
Netherlands  87 87 118 118 118 118 118 
Austria 558 559 561 562 564 566 567 
Poland 1,570 1,176 1,193 1,192 1,191 1,189 1,187 
Portugal 577 578 579 580 581 582 582 
Romania 1,150 1,148 1,177 1,187 1,185 1,142 1,140 
Slovenia 119 119 119 120 120 120 121 
Slovakia  271 213 216 215 215 215 215 
Finland  335 337 338 340 342 343 345 
Sweden  258 258 249 249 250 250 250 
United Kingdom 668 752 756 756 755 756 757 
Technical assistance 34 34 34 34 34 34 34 
Note: The amounts for rural development include transfers between pillars. 
 Technical assistance is not assigned to member States. 
Source: Regulation (EU) No. 1305/2013, Annex I (as last amended by Regulation (EU) No. 1378/2014). 
                                               
24 Court of Auditors (2003), Special Report No. 4/2003 concerning rural development: support for less-
favoured areas, together with the Commission's Replies. OJ 2003/C 151/01, Volume 46, 27 June. WT/TPR/S/317 • European Union 
 
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  4.2.3.2  Export subsidies 
4.50.  The last notification on export subsidies from the EU is for the marketing year 2012/1325 
which indicated that the use of export subsidies had continued to decline in terms of both the 
budget allocation and the product coverage with poultry meat accounting for nearly all spending 
(€55.3 million out of a total of €59.05 million). As noted in the notification, 1.35 million tonnes of 
sugar was exported which did not receive any export refunds but, as this is production in excess of the quota, has been deemed to be a subsidized export.
26 
4.51.  In July 2013, all export subsidy rates were set at zero, and the new rules on the Common 
Organization of Markets state that "without prejudice to the application of exceptional measures, the [export] refund available should be zero"
27 where the exceptional measures which might 
include export refunds are "significant price rises or falls on internal or external markets or other 
events and circumstances significantly disturbing or threatening to disturb the market, where that 
situation, or its effects on the market, is likely to continue or deteriorate"; and "emergency measures to resolve specific problems".
28 
4.2.3.3  Market access 
4.52.  Like earlier reforms of the CAP, the current reform did not affect tariffs, tariff quotas, or the 
use of the special agricultural safeguard. There have been a number of implementing acts under 
Regulation (EU) No. 1308/2013 on import duties  on wheat, rye, maize, and grain sorghum29 and 
daily regulations establishing standard import values for determining the entry prices for certain fruits and vegetables from different countries
30 but, in practice, there have not been any 
significant changes to the methodology for calculating tariffs on cereals or the entry price system 
for certain fruits and vegetables. 
4.53.  On average, bound tariffs on agricultural products (WTO definition) (simple average MFN 
tariff of 14.4%) remain higher than on non-agri cultural products (simple average MFN tariff of 
4.3%) and vary considerably from one agricultural product to another with a standard deviation of 
23.5 compared to 4.4 for non-agricultural products (Table 3.2). In addition, many agricultural products are subject to non- ad valorem  duties that can also vary from simple specific duties to 
more complex forms, such as those in the Meursing Table.
31 However, imports of agricultural 
products from least developed countries and from many developing countries can enter the EU at zero or reduced tariffs under the EU's everything-but-arms initiative, its GSP and GSP+ schemes, and its network of trade agreements. 
4.54.  As in the previous Review, the EU notified 112 separate tariff quotas as being in operation in 
marketing year 2011/12 and calendar year 2012. Fill rates for these quotas vary considerably from 
0 to 100%, although an average fill rate is not very meaningful given the big differences in quota 
sizes and values. However, the majority of quotas are not filled.
32 
4.55.  The EU has reserved the right to use the special agricultural safeguard on 539 tariff lines. 
Actual use has been much less. At end March 2015, the most recent notification on use of the SSG 
in the EU noted that the volume-based SSG was not invoked in 2012/13 although it was made 
operational on 15 fruit and vegetable products (corresponding to 28 tariff lines) while the price-based SSG was made operational on 19 tariff lines in the EU schedule (certain poultry and sugar products). In these cases the term "made operat ional" means prices are monitored and the price-
based SSG may be charged if the import price is below the trigger price or, for the volume-based 
SSG, import volumes are calculated and the volume-based SSG may be charged if the import volume trigger is surpassed.
33 
                                               
25 WTO document WT/AG/G/N/EU/22 of 17 December 2014. 
26 See European Communities – Ex port Subsidies on Sugar , WT/DS265, 266 and 283. 
27 Regulation (EU) No. 1308/2013, whereas 159 and Article 196. 
28 Regulation (EU) No. 1308/2013, Article 196. 
29 For example Commission Implementing Regulation (EU) No. 1206/2014. 
30 For example Commission Implementing Regulation (EU) No. 1237/2014, 1231/2014, 1224/2014, etc. 
31 Regulation (EU) No. 510/2014. 
32 WTO document G/AG/N/EU/16 of 14 November 2013. 
33 WTO document G/AG/N/EU/19 of 5 May 2014. WT/TPR/S/317 • European Union 
 
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  4.2.4  Domestic support levels 
4.2.4.1  WTO notifications 4.56.  The last notification from the EU on domestic support was for the marketing year 2011/12.
34 
This, along with earlier notifications, showed a st ep change in the pattern of support following the 
successive reforms of the CAP with support in the Amber and Blue Boxes declining while Green 
Box support increased. 
4.57.  Within each Box the structure of support has also changed. Within the Amber Box, along 
with the decline in the current total AMS in 2002/03, 2007/08, and again in 2010/11 compared to 
each preceding year, support for beef, fruits and vegetables, sugar, and olive oil has declined or 
disappeared. The change in the structure of suppo rt in the Blue Box is not as marked but the 
decline in the overall level of support, from over  €27 billion in 2004/05 to less than €3 billion in 
2011/12, is considerable. Support notified in the Green Box has increased reaching nearly 
€71 billion in 2011/12 (Chart 4.2). 
4.2.4.2  OECD monitoring and eval uation of agricultural policies 
4.58.  Compared to the Amber, Blue and Green Boxes in the WTO, the OECD's annual monitoring 
and evaluation reports on support to agriculture in  OECD countries uses a different methodology to 
calculate the value of support which is expressed in a number of indicators, including: the Produce 
Support Estimate (PSE) for gross transfers from consumers and tax payers to agricultural 
producers; the Total Support Estimate (TSE) for transfers to the agricultural sector in general; and the Single Commodity Transfers (SCT) for transfers to specific commodities. As noted in the last 
report, the PSE represents the value of transfer s to producers, unlike support under the Amber 
Box, Blue Box and Green Box which me asure compliance with WTO commitments.
35 
4.59.  The last monitoring and evaluation report by  the OECD includes data for calendar year 2013 
but does not include data for the latest reform s of the CAP which started implementation on 
1 January 201536 (Chart 4.3 and Table 4.10). 
4.60.  The OECD data shows that despite reform s up to, but not including, the reforms of 2014, 
support to agricultural producers in the EU, whil e close to the OECD average, remains high in 
absolute terms and has not declined significantly over the past few years, mainly because, for 
some products, high tariffs continued to protect producers from changes in international prices as seen by the relatively high levels of market  price support and the producer net-protection 
coefficients (producer NPC). However, as noted by the Commission, the EU has reduced the "potentially most distorting support" from 92% in 1986-88 to 26% in 2011-13. 
                                               
34 WTO document G/AG/N/EU/20 of 22 October 2014. 
35 WTO document WT/TR/S/284/Rev.2 of 28 November 2013, paragraph 4.34. 
36 OECD (2014), Agricultural Policy Monitoring and Evaluation 2014: OECD Countries , OECD Publishing. 
Viewed at: http://dx.doi.org/10.1787/agr_pol-2014-en . WT/TPR/S/317 • European Union 
 
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  Chart 4.2 Domestic support in the EU, 2002/03–2011/12 
(€ million) 
 - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000
2002/03
2003/042004/052005/06
2006/07
2007/082008/092009/10
2010/11
2011/12de minimis total
Current total AMS
Blue Box
Green Box
Null for chart
05,00010,00015,00020,00025,00030,00035,0002002/032003/042004/052005/062006/072007/082008/092009/102010/112011/12Others
Olive oil
Sugar
Dairy
Cereals
Fruit and vegetables
05,00010,00015,00020,00025,00030,0002002/032003/042004/052005/062006/072007/082008/092009/102010/112011/12Other
Sheep and goats
Dairy
Beef
Crops
 - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,0002002/032003/042004/052005/062006/072007/082008/092009/102010/112011/12
Other
Decoupled income support and SAPS
Structural adjustment, 
environment and regional 
assistance
General servicesGreen, Blue and Amber Boxes 
(including de minimis) Amber box 
(excluding de minimis)
Blue Box Green Box
 
Source: WTO notifications. WT/TPR/S/317 • European Union 
 
- 135 - 
 
  Chart 4.3 Support estimates for agriculture in the EU, 2003-13 
(€ billion) 
050,000100,000150,000200,000250,000300,000350,000400,000450,000
050,000100,000150,000200,000250,000300,000350,000400,000450,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Total Support Estimate Producer Support Estimate Market Prices Support
Total Value of Production
 
 
Source: OECD Producer and Consum er Support Estimates database. 
http://www.oecd.org/chile/ producerandconsumersupportestimatesdatabase.htm  [December 2014]. 
Table 4.10 OECD indicators for support to agriculture in the EU, 2007-13 
(€ million (except producer NPC)) 
 2007 2008 2009 2010 2011 2012 2013 
Total     
 Value of production 326,343 344,323 302,616 326,267 358,731 371,000 375,037
 TSE 102,641 108,400 97,414 90,661 89,558 97,652 98,811
 PSE 89,933 94,345 86,160 78,976 77,907 86,321 87,576
 SC T 34,451 34,253 26,848 17,739 14,731 21,532 23,762
 MPS 29,183 29,171 21,766 13,823 10,906 18,007 20,278
 Producer NPC 1.11 1.10 1.08 1.05 1.03 1.05 1.06
Refined sugar    
 Value of production 3,749 3,290 3,581 3,161 4,027 3,819 3,068
 SC T 1,832 1,474 626 77 42 52 114
 MPS 1,802 1,431 551 0 0 0 55
 Producer NPC 1.93 1.77 1.19 1.00 1.00 1.00  1.02
Milk    
 Value of production 46,887 50,759 39,315 44,477 50,736 50,070 51,818
 SC T 124 5,170 614 730 669 885 780
 MPS -199 4,803 0 0 0 135 0
 Producer NPC 1.01 1.11 1.01 1.01 1.01 1.01 1.01
Beef    
 Value of production 22,611 24,200 24,034 25,036 26,591 28,686 28,300
 SC T 11,980 9,398 9,896 4,563 4,231 9,659 11,879
 MPS 9,798 6,975 7,785 2,919 2,592 8,082 10,336
 Producer NPC 1.80 1.40 1.48 1.13 1.11 1.39 1.58
Pork    
 Value of production 29,704 34,193 30,031 30,373 33,647 36,670 37,375
 SC T -533 86 112 536 23 28 709
 MPS -618 0 0 511 0 0 700
 Producer NPC 1.00 1.00 1.00 1.02 1.00 1.00 1.02
Poultry    
 Value of production 12,647 13,197 12,907 13,411 14,990 15,689 15,962
 SC T 4,655 4,512 4,902 3,852 3,472 3,181 1,588
 MPS 4,562 4,417 4,806 3,833 3,453 3,156 1,582
 Producer NPC 1.64 1.50 1.59 1.40 1.30 1.25 1.11WT/TPR/S/317 • European Union 
 
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   2007 2008 2009 2010 2011 2012 2013 
Sheep meat    
 Value of production 4,330 4,025 3,742 3,835 4,448 4,727 4,747
 SC T 1,460 1,218 1,323 781 317 731 1,186
 MPS 1,068 805 839 475 0 413 877
 Producer NPC 1.35 1.25 1.29 1.14 1.00 1.10 1.23
Note: Total support estimate (TSE) is the annual mone tary value of all gross tr ansfers from taxpayers and 
 consumers arising from policy measures that su pport agriculture, net of  associated budgetary 
 receipts, regardless of their objectives and impact s on farm production and income, or consumption 
 of farm products. 
 Producer support estimate (PSE) is the annual monetary value of gross transfers from consumers 
 and taxpayers to agricultural producers, measur ed at the farm-gate level, arising from policy 
 measures that support agricultur e, regardless of their nature, objectives or impacts on farm 
 production or income. 
 Single commodity transfer (SCT) is the annual monetary value of gross transfers from consumers 
 and taxpayers to agricultural producers, measur ed at the farm-gate level, arising from policy 
 measures directly linked to the production of a single commodity such that the producer must  produce the designated commodity in order to receive the transfer. 
 Market price support (MPS) is an indicator of the annual monetary value of gross transfers from 
 consumers and taxpayers to agricultural produc ers arising from policy measures creating a gap 
 between domestic producer prices and reference prices of a specific agricultural commodity 
 measured at the farm-gate level. 
 The Producer Nominal Protection Co-efficient (Produ cer NPC) is an indicator of the nominal rate of 
 protection for producers measuring the ratio betw een the average price received by producers (at 
 farm-gate), including payments per tonne of cu rrent output, and the bord er price (measured at 
 farm-gate level). 
Source: OECD Producer and Consumer Su pport Estimates database. Viewed at: 
 http://www.oecd.org/chile/ producerandconsumersupportestimatesdatabase.htm  [December 2014]. 
4.3  Services 
4.3.1  Telecommunications services 4.3.1.1  Statistical overview 
4.61.  The following tables and Chart provide th e main indicators of the EU telecommunication 
industry in terms of foreign affiliates trade statistics (i.e. of sales by subsidiaries of foreign companies in the EU for inward FATS, and sales of subsidiaries of EU companies abroad for 
outward FATS), value-added, employment (Table 4.11) and main trading partners (Chart 4.4 and 
Table 4.12). 
Table 4.11 Telecommunications services  main economic indicators, 2010-12 
  2010 2011 2012
Foreign affiliates sales/turnovera    
  Inward: (€ billion) .. 45 .. 
    % of total inward foreign affiliatesb .. 9.5 .. 
  Outward: (€ billion) 109 112 .. 
    % of total outward foreign affiliates 11.7 12.0 .. 
FDI c     
Inward (€ billion)     
  Position 261 171 .. 
  Financial transactions 39 3 .. 
Outward € billion)     
  Position 392 640 .. 
  Financial transactions 46 59 .. 
Inward (% of GDP)     
  Position 2.1 1.3 .. WT/TPR/S/317 • European Union 
 
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    2010 2011 2012
  Financial transactions 0.3 0.02 .. 
Outward (% of GDP)     
  Position 3.2 5.1 .. 
 Financial transactions 0.4 0.5 .. 
Value-added (% of value-added of total economy)  1.6 1.5 1.5 
Employmentc     
  In 1,000 1,030 1,030 .. 
  Share in total employ ment in services (%) 0.6 0.6 .. 
  Share in total employment in Information and Communication (%) 16.9 16.6 .. 
.. Not available. 
a FATS inward refers to the sales by foreign af filiates which are located in the EU(28) and are 
controlled by non-EU(27) entities. FATS outward refers to the sales of  affiliates which are established 
outside the EU (28) and are controlled by EU(27) entities. 
b Community, social and personal services activities and financial intermediation activities are not 
covered in total inward figures. 
c Refers to EU27.  
Source: WTO estimates based on Eurostat data (throu gh the ITIP, Integrated Trade Intelligence Portal, 
services statistics module). Viewed at: https://i-tip.wto.org/ services/Search.aspx ; and information 
provided by the authorities. 
Chart 4.4 EU-28 major extra-EU trading pa rtners of telecommunications services 
(€ billion) 
0246810121416
2010 2011 2012United States Switzerland South Africa
Russian Federation Norway NES
RoW
02468101214
2010 2011 2012United States Switzerland
NES Morocco
Russian Federation Norway
ExportsImports
 
Source: WTO-UNCTAD-ITC trade in services database, based on OECD, IMF, EUROSTAT, UNSD and national 
 data, July 2014. 
 WT/TPR/S/317 • European Union 
 
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  Table 4.12 EU-28 major extra EU trading partners of telecommunications servicesa, 2012 
(€ million and % of total) 
Exports Imports 
Partner € million % of total Partner € million % of total
Extra-EU 14,942 100.0 Extra-EU 12,284 100.0 
  United States 2,605 17.4   United States 1,999 16.3 
  Switzerland 1,766 11.8   Switzerland 1,180 9.6 
  South Africa 715 4.8   Morocco 504 4.1 
  Russian Federation 626 4.2   Russian Federation 411 3.3 
  Norway 382 2.6   Norway 363 3.0 
  Brazil 357 2.4   Canada 328 2.7 
  Turkey 322 2.2   Hong Kong, China 246 2.0 
  Singapore 294 2.0   Turkey 232 1.9 
  India 283 1.9   India 229 1.9 
  Australia 244 1.6   Brazil 211 1.7 
 
a Transmission of sound, images or other information by telephon e, telex, telegram, radio and 
 television cable and broadcasting, satellite, electronic mail, facsimile services etc., including business  network services, teleconferencing and support se rvices. Value of information transported excluded. 
 Included: cellular telephone services, internet  backbone services and online access services, 
 including access to the internet.  Source: WTO-UNCTAD-ITC trade in services database, based on OECD, IMF, EUROSTAT, UNSD and national 
 data, July 2014. 
4.62.  The tables below describe the penetration rates for various telecom services (Table 4.13), 
and the revenue and investment in the electronic communications sector (Table 4.14). 
Table 4.13 Selected telecommunication s indicators for EU-28, 2010-13 
  2010 2011 2012 2013
Mobile phone subscribers (% of total telephone subscribers) 72.0 72.9 73.7 74.4 
Total telephone subscribers (fixed and mobile) (per 100 
inhabitants) 164.7 166.4 167.1 167.4 
Broadband internet subscribers (per 100 inhabitants) 25.9 27.2 28.2 29.1 
Secure internet servers (no) 304,880 361,796 374,979 349,125 
Internet users (per 100 inhabitants) 73.0 75.0 77.0 79.0 
Source: International Telecommunication Union (ITU). Viewed at:  
 http://www.itu.int/en/ITU-D/Statistics/ Pages/stat/default.aspx ; and Netcraft (through World Bank). 
Table 4.14 Revenues and investment in th e electronic communications sector, 2010-12 
(€ billion) 
 2010 2011 2012
Revenues 327.3 334.7 323.6 
Increase .. 2.2% -3.3% 
Investmenta 38.8 41.5 42.1 
Increase .. 6.9% 1.4% 
.. Not available. 
 a The investment figures do not incl ude fees for the acquisition of ri ghts of use of radio frequencies. 
 Source: Commission document SWD (2014) 249 final. WT/TPR/S/317 • European Union 
 
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  4.3.1.2  Regulatory framework and policy developments 
4.63.  The basic regulatory framework of telecommu nication services in the European Union dates 
back to 2002, was amended in 200937, and has been described in previous TPR reports.38 During 
the period under review the member States completed the transposition of this legislative 
package, and several secondary legislations/regulations related to this package have been 
adopted. In 2010 the European Commission placed the telecommunications policy into a wider framework by adopting the Digital Agenda for Euro pe (DAE) which is aimed at taking advantage of 
the potential offered by the rapid progress of di gital technologies, notably by setting ambitious 
targets for the deployment of 4G and broadband  networks, but the scope of the Agenda goes 
beyond telecommunication services to include areas such as e-commerce, and e-government.
39 
The DAE is itself part of a wider programme, the Europe Strategy 2020 for Smart, Sustainable and 
Inclusive Growth. In addition to these elemen ts, the main regulatory development regarding 
telecommunication services is the adoption by the European Commission of a wide-ranging new legislative package, the "Connected Continent Pa ckage" in September 2012 and its subsequent, 
and still ongoing, discussion in the Parliament and the Council. 
4.3.1.2.1  Implementation of the 2009 pa ckage and related secondary legislation 
4.64.   The implementation of th e 2009 regulatory framework is monitored by an annual report of 
the Commission.
40 The main findings of the 2014 edition of this report can be summed up as 
follows. 
4.65.  The Commission adopted its Recommendation on termination rates on 7 July 200941 which, 
inter alia , recommended the use of BU-LRIC (Bottom- Up Long Run Incremental Cost) as the 
costing methodology for fixed and mobile termination rates. The Commission recommendations 
adopted under the Regula tory Framework for Electronic Communications42 are not binding, but 
must be taken into account by the member States' National Regulatory Agencies (NRAs), who are 
responsible for conducting periodic market analyses and imposing regulatory obligations on 
operators. The overwhelming majority of NRAs have endorsed the recommended costing methodology in their decisions. However, there rema in several NRAs that have yet to notify their 
decisions to the Commission (a higher number in the case of fixed than mobile termination), but 
the Commission expects that the decisions concerning termination rates will be notified shortly. The Commission and the Body of European Regulators of Electronic Communications
43 (BEREC) are 
cooperating to take steps to ensure consistency in these markets. 
4.66.  Regarding markets for wholesale (physical) network infrastructure access and wholesale 
broadband access, an increasing number of Significant Market Power (SMP) suppliers are now required to provide virtual (i.e. non-physical access) unbundling products with enhanced 
characteristics in addition to physical products (e.g. in the United Kingdom, Austria, Malta and 
Denmark). A large number of the most recently notified draft measures took account of the recent Commission Recommendation on consistent non-discrimination obligations and costing 
methodologies.
44 This Commission Recommendation was adopted as part of the "Connected 
Continent" legislative package (which also includes a proposal for a Regulation, which is discussed below) and aims to foster the development of high-speed internet networks by increasing certainty for investors, and reducing divergences among NR As' regulatory approaches in the treatment of 
                                               
37 The main legislative instruments of this regulatory framework being Directive 2002/21/EC 
("Framework Directive"), Directive 2002/20/EC ("Authorization Directive"), Directive 2002/19/EC ("Access Directive"), Directive 2002/22/EC ("Universal Service Directive), Directive 2002/58/EC ("Directive on Privacy and Electronic Communications") and the three roamin g regulations: Regulation (EC) 717/2007, Regulation 
544/2009 and Regulation (EU)531/2012. 
38 In the 2009 report (WT/TPR/S/214 paragraphs 137 to 141) and in the 2011 report (WT/TPR/S/248 
paragraphs 95 to 100). 
39 For the complete text of the DAE see: http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:52010DC0245R(01)&from=EN . 
40 For the full text of this report see: https://ec.europa.eu/digital-agenda/en/news/2014-report-
implementation-eu-regulatory-framework-electronic-communications . 
41 Commission recommendation C (2009) 3359 of 7 July 2009. 
42 In particular Article 19 of Directive 2002/21/EC (Framework Directive). 
43 Established by Regulation No. 1211/2009 of the European Parliament and of the Council of 
25 November 2009. 
44 Commission recommendation C(2013) 5761 of 11 September 2013. WT/TPR/S/317 • European Union 
 
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  next generation access (NGA) networks.45 Like the recommendation on termination rates, this 
Commission Recommendation is addressed to member States. It is not a binding document but NRAS have to take account of it when imposing regulatory remedies, in accordance with the EU Regulatory Framework. The Commission Recommendation on consistent non-discrimination 
obligations and costing methodologies contains a recommended approach that NRAs should follow 
when setting obligations on operators with SMP in a particular market, whereby such operators must allow third-party operators to gain access to their electronic communications networks upon 
payment of a wholesale price, so that these third-party access seekers can reach end-users 
without having to deploy their own access networks. The Recommendation contains provisions aimed at ensuring greater consistency in the way in which NRAs impose these obligations on SMP operators. In particular, it recommends an approach on how to regulate the price that regulators 
can impose on SMP operators for granting third-parties wholesale access to their legacy copper 
networks. The Recommendation aims at providing greater consistency in the ways such prices are set, as well as at stabilizing them over time. At present national regulators apply different ways of 
calculating wholesale copper access prices, so that the monthly rental price of copper network 
access
46 through the imposition of the local loop unbundling (LLU) obligation is regulated in 
significantly different ways among member States which results in significantly different access 
prices as well as long-term price trends.  
4.67.  The Recommendation considers that the application of the costing methodology should 
result in LLU monthly prices within a band of €8 and €10 (net of all taxes) expressed in 2012 
prices. By recommending a specific approach to costing methodologies and  by setting common 
rules on pricing, asset lifetimes and depreciation, the Commission seeks to ensure long-term price 
stability and more aligned prices across the single market. In addition to the approach to the access prices to copper networks, the Recommendation seeks to encourage investment by 
recommending that price regulation on access to upgraded high-speed NGA networks (the rollout 
of which is still ongoing) is not imposed, thus granting SMP operators greater freedom to set prices for wholesale access to NGA networks on the condition that demonstrable constraints against anti-
competitive behaviour exist in the retail markets and by instituting strengthened non-
discrimination obligations to ensure healthy competition, in particular recommending that wholesale access is provided on the strict basis of the principle of "Equivalence of Inputs" (EoI). In 
effect, the Commission considers that, on the one hand, copper network owne rs need stability of 
income from renting-out their networks to competitors to enable investment in faster NGA 
networks and that, on the other hand, alternative operators require a more consistent basis for planning pan-EU business operations, based on stable and consistent access prices, as well as 
other competitive safeguards such as strict non-discrimination rules. Article 8(2) of the 
2002/21/EC Directive ("Framework Directive") in cludes, amongst the policy objectives and 
regulatory principles for NRAs, the promotion of investment, the elimination of distortions of 
competition, and the maximization of consumer benefits. The Commission's Recommendations 
such as those on termination rates and on consistent non-discrimination obligations and costing methodologies provide guidance on how these regu latory objectives can be better achieved in 
practice and in a consistent way across the EU, through the implementation of regulatory 
measures.  
4.68.  Regulators in several member States have continued the trend towards lifting ex-ante  
regulation of certain markets, notably wholesale markets for access and call origination on public 
mobile and fixed telephone networks and retail ma rkets for publicly available telephone services. 
Furthermore, the adoption by the Commission of a new recommendation on relevant markets (the third edition since 2003) on October 2014
47, has reduced the list of markets susceptible to ex ante  
regulation from seven to four, sending a clear signal for further deregulation of the electronic 
communication sector. The statutory timeframes for reviews (i.e. the reviews conducted in the 
                                               
45 Next Generation Access (NGA) networks are defined in Commission Recommendation 2010/572/EU of 
20 September 2010 on regulated access to (NGA) as wired access networks which consist wholly or in part of optical elements and which are capable of delivering broadband access services with enhanced characteristics (such as higher throughput) as compared to those prov ided over already-existing copper networks. In most 
cases NGAs are the result of an upgrade of an already-ex isting copper or co-axial ac cess network. For the full 
text of the Recommendation please see: http://eur-lex.europa.eu/legal-
content/EN/ALL/;ELX_SESSIONID=K bNLJJLFPV2qLSfhFBCBpnCZYm3VR2T jSCvvhwGwWFDLvSV4VpL9!1358166
493?uri=CELEX:32010H0572 . 
46 I.e. the rental price that regulated SMP operator s can charge third party access seekers for access to 
their copper-based networks.  
47 Recommendation 2014/7107 EU of 9 October 2014. WT/TPR/S/317 • European Union 
 
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  context of making determinations of which suppliers are considered to have market power and 
hence might be subject to some ex-ante regulation due to their position in the market) was a concern for the Commission in several member States. For Luxembourg, the lengths of delays in market reviews overall led the Commission to initiate infringement proceedings. 
4.69.  Regarding authorization regimes, the 2002 Authorisation Directive
48 harmonized the 
procedures and conditions to be fulfilled in order to legitimately provide electronic communications, in line with the principles of tr ansparency, proportionality and non-discrimination. 
In this regard, the Regulatory Framework establis hes a system whereby the provision of electronic 
communications services and/or network is, in principle, only subject to compliance with the general conditions provided for in the national general authorization, laying down: the right to provide electronic communications services; and the sector specific obligations applicable to all, or 
to specific types, of electronic communications networks and services. In addition to compliance 
with the general authorization framework, member States may require providers to submit a notification before starting to exercise the rights stemming from the general authorization. 
However, this additional notification obligation, currently applied by most member States, is for 
identification purposes only and providers do not need to obtain any explicit decision to commence activities. Still, the notification requirements remain national, also for cross-border operators, and 
each member State may modify the conditions applicable to the provision of electronic 
communications, provided that they are included  in the closed list annexed to the Directive. 
Greece, Romania and Hungary removed certain establishment and guarantee requirements not included among the admissible conditions or dro pped additional notification requirements not 
necessary for provider identification. Despite these successes a few cases concerning the 
authorization regime are still pending. 
4.70.  Regarding spectrum management, the Radio Spectrum Policy Programme (RSPP) (Decision 
243/2012/EU) was adopted in March 2012. It introduces obligations on member States and the 
Commission relevant for spectrum management at large. These obligations include: deadlines for 
member States for the authorization of frequency bands for wireless broadband (in particular the 
800 MHz band) and the establishment of a radio sp ectrum inventory; and a mechanism to assess 
spectrum supply and demand at EU level. In terms of implementation, delays in assignment of the 
800 MHz band are seen as the main obstacles to 4G development. 
4.71.  The procedures for granting rights of wa y and the time needed to receive a permit vary 
among member States, both in law and in practice . This discrepancy is expected to be attenuated 
with the implementation of the new Directive on the cost reduction of broadband roll-out network infrastructures.
49 Tacit approval or one-stop-shop best practices are being introduced in a few 
member States (Greece, Portugal, Romania, Italy). However, electronic submission of requests is 
still not widely available; and there are big diffe rences for fees for the use of the land. On the 
other hand, transparency is facilitating access to the physical infrastructure, through mapping (in 
12 member States50), registers (Denmark, Finland), or databases (Hungary). Access to utility 
infrastructure is mandated only in Italy, Lithuania, Portugal and Bulgaria. Civil works coordination lowers the cost of deployment in Slovenia, Denmark, Finland, Luxembourg, Greece, Italy, Hungary, France and Cyprus. The situation in the member States is expected to improve in that 
regard with the progressive transposition of Directive 2014/61/EU of 15 May 2014 on measures to 
reduce the cost of deploying high-speed electr onic communications networks. The Directive aims 
to reduce by 20-30% the cost of deploying high-speed networks by: (i) making better use of 
existing infrastructure, including cross-utility, and transparency of existing infrastructure; 
(ii) better coordinating civil works also through enhanced transparency of planed civil works; (iii) streamlining permit granting; and (iv) making sure that new buildings and buildings 
undergoing major renovation works are "high-speed broadband-ready", i.e. are equipped with 
physical infrastructure capable of hosting elemen ts of high-speed networks and organising access 
of public communications providers to such infrastructure. 
                                               
48 For the consolidated text of the amended authorization directive see: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:2002L0020:20091219:EN:PDF . 
49 Directive 2014/61/EU of the European Parliament and of the Council of 15 May 2014 on measures to 
reduce the cost of deploying high-speed  electronic communications networks. 
50 Portugal, Austria, Germany, the Netherlands, Slovenia, Poland, Czech Republic, Latvia, Greece, 
Luxembourg, Denmark and Cyprus. WT/TPR/S/317 • European Union 
 
- 142 - 
 
  4.72.  Regarding access and interconnection, with only a few remaining exceptions, all operators 
including incumbents, offer IP interconnection products on a commercial basis. Only in a limited number of member States (Austria, Bulgaria, Croatia, Denmark) a specific obligation is imposed on Significant Market Power (SMP)-operators. France and Spain have put in place a reporting 
obligation for the operators to monitor the IP interconnection market and the dynamics of IP 
interconnection agreements between operators and Over the Top (OTT) market players. In several 
member States, tensions were observed between operators and their interconnection partners 
(transit providers, OTT players) including the question of paid peering. Since interconnection 
disputes are dealt with by the national regulatory authorities, in the absence of a reporting system, the Commission was, not in a position to provide statistics and details on those disputes. 
4.73.  Several member States have relaxed their un iversal service obligations relating to services 
already delivered by the market or of declining significance, in particular with regard to telephone 
directories (Belgium, Czech Republic, Italy, Lithuania, and Cyprus), enquiry services (Austria, Belgium, Czech Republic, France, Italy, and Spain) , or pay-phones (Belgium, Finland, Latvia, the 
Netherlands, and Cyprus). In some member States a universal service-provider is no longer 
designated (e.g. Estonia, Germany, Luxembourg , Poland, Romania, and Sweden). Some member 
States (Belgium, Croatia, Finland, Malta, Romani a, Spain, and Slovenia) have decided to extend 
their universal-service obligations to include basic broadband (from 144k bps up to 1 and 4 Mbps). 
When an electronic communications provider is de signated as a universal service provider it is 
predominately the ‘former’ incumbent. The vast majority of member States have chosen a compensation mechanism solely financed by the electronic communication sector and not by 
respectively mixed public/sectoral funding. In several member States there has never been an 
active compensation mechanism. 
4.74.  Regarding facility-sharing, there has been no major evolution in the regulatory framework 
but mobile infrastructure sharing agreements between mobile network operators have become 
common practice in many member States. This ranges from passive sharing (e.g. masts, electricity) to sharing of active network elements (e.g. a radio access network) or even 
spectrum-sharing. Such agreements are subject to competition rules. 
4.75.  Finally, regarding net neutrality some members States have followed different approaches, 
ranging from self-regulation to binding legislation. However, most pending national measures were stopped after the "connected continent" packagel as the debate is now mainly concentrated on 
EU-level legislation. 
4.3.1.2.2  The "Connected Contin ent" draft legislative package 
4.76.  On 11 September 2013, the Commission presented its "connected continent legislative 
package", composed of two elements: on the one ha nd a proposal "for a regulation of the Council 
laying down measures concerning the European single market for electronic communications and to achieve a connected continent" (COM(2013) 627 final) and, on the other, a Recommendation 
"on Costing Methodologies and Non-Discrimination" (see above). Upon their presentation, the 
Commission deemed these proposals to be the "most ambitious plan in 26 years of telecoms' market reform" and estimated the macroeconomic gains of a real single telecom market to an annual boost of 0.9% to GDP i.e. the biggest sing le EU-wide macroeconomic boost available in the 
next few years. The European Parliament adopted its First Reading Resolution on 3 April 2014 with 
a number of amendments. As at end-March 2015, discussions in the Council were ongoing. 
4.77.  To justify its proposal, the impact assessment report of the Commission made a direct 
reference to the findings of an investigation into the cost of "non-Europe" in telecoms
51 which 
show that the annual gains which would result from  the building of a fully-fledged internal market 
amount to 0.9% of GDP, or up to €110 billion. Th ese gains could be achieved by means of easier 
entries in more competitive markets, and through a better exploitation of economies of scale. The 
main obstacles to the single market which have been identified are the heterogeneity in the implementation of EU telecoms' rules which results in market fragmentation, and the lack of EU standards for interoperability to enable service provision across the EU. 
                                               
51 Van Gorp N, Canoy M, Canton E, Meindert L, Volkerink B, Lemstra W, Nooren P, Stokking H (2011), 
Steps towards a truly Internal  Market for e-communications , Study prepared for the Co mmission by Ecorys, TU 
Delft, and TNO, 14 November, Rotterdam. Viewed at: http://ec.europa.eu/digital- agenda/en/pillar-i-digital-
single-market/action-20-investigate-cost-non-europe-telecoms-market  [March 2015]. WT/TPR/S/317 • European Union 
 
- 143 - 
 
  4.78.  The main provision of the draft regula tion may be summarized as per the following 
paragraphs. 
4.79.  The proposed regulation aims first at si mplifying the requirements for the provision of 
electronic communications services on a cross-bord er basis through the establishment of a single 
initial authorization regime for operating across borders. This would establish a coordinating 
regulator in the country of origin for the enforcement of authorization conditions, including withdrawal and suspension of the authorization on  the model of the EU banking single passport. 
4.80.  The second major proposal aims at ensuring a consistent approach to decide which markets 
should be subject to regulatory measures by NRAs by making legally-binding the use of the cumulative "three criteria test", namely: (i) the presence of high and non-transitory structural, legal or regulatory barriers to entry; (ii) that the market structure does not tend towards effective 
competition within the relevant time horizon, having regard to the state of infrastructure 
competition, the level of competition, and barriers to entry; and (iii) that current competition law alone does not adequately address market failure(s)  in the sector. National regulators would also 
have to consider all competitive constraints, including from Over the Top players (OTTs). 
4.81.  A third proposal would give the Commission the power to block national decisions on 
remedies on cross-border operators in order to ensu re a consistent application of EU regulations. A 
fourth suggested measure would harmonize the technical definitions of non-physical wholesale 
access products (e.g, bitstream) and to a certain extent the conditions for their regulatory provision. 
4.82.  In order to tackle fragmented rules, prices  and timetables, the draft regulation also contains 
provisions on the coordination of spectrum assignment. These measures would include 
harmonizing the timing of spectrum release and the duration of rights, to deal with problems such 
as overpriced spectrum auctions. Member States would remain in charge, and continue to benefit 
from related fees from mobile operators, while operating within a more coherent framework.  
4.83.  The draft regulation also contains specific measures for spectrum assignment for 4G where 
the EU suffers from a considerable lag and for which congestion is looming. These measures would 
increase capacity through less onerous authorization conditions, through the removal of 
unnecessary deployment restrictions and overly complex procedures for granting permits for micro base stations, or wireless hotspot deployment, and through the institution of a right-to-share access to Wi-Fi access points.  
4.84.  The draft regulation provides for a major overhaul of roaming charges regulation. Incoming 
call charges while travelling in the EU would be banned. Telecom companies would have the choice to either (i) offer phone plans that apply everywhe re in the European Union ("roam like at home"), 
the price of which will be driven by domestic competition, or (ii) allow their customers to 
“decouple”, that is: opt for a separate roaming pr ovider who offers cheaper rates (without having 
to buy a new SIM card). These proposals build on the 2012 Roaming Regulation which subjected 
operators to wholesale price cuts of 67% for da ta as of July 2014. The package would also ban 
international call premiums within the EU. In other words, instead of charging a premium for both fixed and mobile calls made from a consumer's home country to other EU countries, telecom companies would not be able to charge more for a fixed intra-EU call than they do for a long-
distance domestic call. For mobile intra-EU calls, the price would not be more than €0.19 per 
minute (plus VAT). Setting higher prices would need to be supported by objectively justified costs. The draft regulation would also institute new cons umer and end-users' rights, harmonized across 
the EU, in areas such as information requirements in contracts and termination thereof. 
4.85.  Finally the last major element of the draft regulation is constituted by provisions aimed at 
preserving an "open internet". To address this question at the EU level the Commission suggests 
that blocking and throttling of internet content should be banned, giving users access to the full 
and open internet regardless of the cost or speed of their internet subscription. Clear rules for traffic management on the internet, which would have to be non-discriminatory, proportionate and transparent, would be set. However, companies woul d be allowed to differentiate their offers (for 
example by speed) and compete on enhanced qu ality of service but subject to the vital pre-
condition that the quality of open internet must not be impaired. So-called specialized services (such as IPTV, video-on-demand, apps including high-resolution medical imaging, virtual operating WT/TPR/S/317 • European Union 
 
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  theatres, and business-critical data-intensive cloud applications)with an enhanced level of quality 
can only be provided if the operator ensures that  these services do not come at the detriment of 
the quality of the open internet.  
4.86.  Competition is the main driver for investment in high-quality broadband infrastructure and 
benefits not only individual consumers, but also businesses of all sizes, including SMEs. For 
example, figures show that new market entrants have driven broadband investment in the EU, rather than national incumbents: incumbents in  the EU have a 42% market share of all fixed 
broadband subscriptions, but only 22% of NGA subscriptions.
52 Competition also improves the 
quality of services delivered to consumers and businesses and makes them affordable, which in turn stimulates demand for such services. 
4.87.  In line with the objectives of the Digital Agenda on fast and ultra-fast broadband 
penetration, the Commission takes a favourable view as regards State aid measures having the 
objective to provide adequate broadband coverage at affordable prices for all European citizens. The biggest obstacles to achieving these objectiv es are the significant "funding gap" and "market 
failures" which occur when operators consider that there is not enough demand for services 
requiring such advanced networks. Public financing is therefore considered essential to achieve the 
Digital Agenda targets. As such intervention risks crowding out private investment, the main 
objective of State aid control in this sector is to reconcile the conflicting objectives of fostering 
rapid roll-out of broadband infrastructure and limiting distortions of competition. This is done on the basis of the Broadband Guidelines which were revised in 2013
53 to take into account in 
particular the Digital Agenda targets. The Broadband Guidelines indicate concrete conditions that 
have to be fulfilled for the public intervention to  be considered as not excessively distortive: an 
open tender process, the choice of the most economically advantageous offer, technological neutrality, use of existing infrastructure, wholesale third party access at prices derived from 
benchmarking, and a claw-back mechanism to avoid over-compensation. 
4.3.2  Audiovisual services 4.3.2.1  Statistical overview 
4.88.  The following tables and chart provide the ma in indicators of the EU audiovisual industry in 
terms of foreign affiliates trade statistics (i.e. of sales by subsidiaries of foreign companies in EU 
for inward FATS and sales of subsidiaries of EU companies abroad for outward FATS), value-added, employment (Table 4.15) and main trading partners (Chart 4.5 and Table 4.16). 
Table 4.15 Motion picture, radio, television  and other entertainment activities main 
economic indicators
a, 2010-12 
 2010 2011 2012
Foreign affiliates sales/turnoverb, c    
  Inward: € billion 10 11 .. 
  % of total inward foreign affiliates d 2.4 2.3 .. 
  Outward: € billion 7 8 .. 
  % of total outward foreign affiliates 0.8 0.9 .. 
FDI    
Inward (€ in billion)    
  Position 43 32 .. 
  Financial transactions 2 -2 .. 
Outward (€ in billion)    
  Position 30 42 .. 
  Financial transactions 1 5 .. 
Inward (% of GDP)    
  Position 0.4 0.3 .. 
  Financial transactions 0.02 -0.02 .. 
                                               
52 Source: Digital Agenda Scoreboard, 2014. 
53 Communication from the Commission on EU Guidelines for State Aids Rules in Relation to the Rapid 
Deployment of Broadband Networks, 2013/C 25/01. For the full text of these guidelines see: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2013:025:0001:0026:EN:PDF . WT/TPR/S/317 • European Union 
 
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   2010 2011 2012
Outward (% of GDP)    
  Position 0.2 0.3 .. 
  Financial transactions 0.01 0.04 .. 
Value-added (% of value-added of total economy)  1.3 1.2 1.2 
Employment    
  In 1,000 1,783 1,802  
  Share in total employ ment in services (%) 1.1 1.1 .. 
  Share in total employment in information and communication (%) 29.3 29.0 .. 
.. Not available. 
 a Motion picture, radio, television  and other entertainment activities includes production of theatrical 
and non-theatrical motion pictures whether on film, vi deotape or disc for direct projection in theatres 
or for broadcasting on television; supporting activities such as film  editing, cutting, dubbing etc.; 
distribution of motion pictures and other film productions to othe r industries; as well as motion 
pictures or other film productions projection. Also included is the bu ying and selling of distribution 
rights for motion pictures or ot her film productions. Also includes the sound recording activities, 
i.e. production of original sound master record ings, releasing, promotin g and distributing them, 
publishing of music as well as  sound recording service activiti es in a studio or elsewhere. 
b FATS inward refers to the sales by foreign af filiates which are located in the EU(28) and are 
controlled by non-EU(27) entities. 
 FATS outward refers to the sales of affiliates  which are established outside the EU(28) and are 
controlled by EU(27) entities. 
c FATS inward refers to motion picture, radio,  television, and other entertainment activities. 
 FATS outward refers to motion picture, video,  television programme production, programming and 
broadcasting activities. 
d Refers to EU(27).  Source: WTO estimates based on Eurostat data (throu gh the ITIP, Integrated Trade Intelligence Portal, 
services statistics module). Viewed at: https://i-tip.wto.org/ services/Search.aspx . 
Chart 4.5 EU-28 major extra-EU trading part ners of other royalties and licence fees 
(€ billion) 
0510152025
2010 2011 2012United States Switzerland Japan
China Brazil Korea, Republic of
Canada Singapore RoW
051015202530
2010 2011 2012United States Switzerland Japan RoW( )
Exports Imports
 
Source: WTO-UNCTAD-ITC trade in services database, based on OECD, IMF, EUROSTAT, UNSD and national 
data, July 2014. WT/TPR/S/317 • European Union 
 
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  Table 4.16 EU-28 major extra-EU trading part ners of other royalties and licence feesa, 
2012 
Exports Imports 
Partner € million % of total Partner € million % of total
Extra-EU 23,598 100.0 Extra-EU 26,655 100.0 
  United States 9,498 40.3   United States 14,398 54.0 
  Switzerland 2,026 8.6   Switzerland 2,915 10.9 
  Japan 1,518 6.4   Japan 2,048 7.7 
  China 1,173 5.0   Australia 238 0.9 
  Brazil 954 4.0   Canada 206 0.8 
  Korea, Republic of 730 3.1   Norway 194 0.7 
  Singapore 526 2.2   Korea, Republic of 128 0.5 
  Australia 687 2.9   China 110 0.4 
  Russian Federation 658 2.8   India 61 0.2 
  Canada 585 2.5   Morocco 58 0.2 
a Other royalties and license fees includes international payments an d receipts for the authorized use 
of intangible, non-produced, non-financial assets an d proprietary rights (such as patents, copyrights 
and industrial processes and design s) and with the use, through licensing agreements, of produced 
originals or prototypes (such as manuscripts, co mputer programs, and ci nematographic works and 
sound recordings). Audiovisual royalties and licences  fees are only a fraction of this wider item but 
cannot be isolated by the present statistical framework. 
 Source: WTO-UNCTAD-ITC trade in services database, based on OECD, IMF, EUROSTAT, UNSD and national 
data, July 2014. 
4.89.  Tables 4.17 to 4.19 below describe respectively the revenue streams of EU broadcasters 
(Table 4.17) consumer expenses on audiovisual se rvices in the EU (Table 4.18) and the Video-on-
Demand revenues (Table 4.19) ava ilable for the last five years. 
Table 4.17 Broadcasters' net revenues, 2009-13 
(€ million) 
 2009 2010 2011 2012 2013 2012/13
% 
Public broadcasters (incl. radio) 33,474 33,851 33,724 32,664 32,547 -0.4 
Advertising TV 19,613 21,163 21,713 21,151 26,656 -2.3 
Thematic channels 9,341 10,047 10,996 10,733 10,839 +0.9 
Home shopping channels 2,453 2,610 2,719 2,792 2,813 +0.8 
Regional and local TV (estimated) 1,326 1,395 1,350 1,278 1,138 -10.8 
Private radio (estimated) 3,388 3,556 3,656 3,665 3,607 -1.6 
Total 69,594 72,622 74,158 72,284 71,596 -1.0%
Source: European Audiovisual Observatory. 
Table 4.18 Consumer expenses for audiovis ual distribution services (incl. taxes)a, 
2009-13 
 2009 2010 2011 2012 2013 2012/13% 
Cable 11,212 11,844 12,201 12,790 12,869 +0.6 
Satellite 13,874 15,689 16,336 16,913 17,255 +2.0 
Internet Protocol Television 
(IPTV) 1,785 2,375 3,222 4,029 4,525 +12.3 
Digital Terrestrial Television 
(DTT) 1,080 1,509 1,602 1,694 1,724 +1.7 
Cinema gross box-office 6,087 6,373 6,445 6,570 6,285 -4.3 
Total 27,950 31,417 33,362 35,427 36,374 2.7% 
a Includes TV subscription, PPV and VoD revenues. 
Source: European Audiovisual Observatory. WT/TPR/S/317 • European Union 
 
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  Table 4.19 VoD online revenues, 2009-13 
 2009 2010 2011 2012 2013 2012/13
% 
Online on demand TV revenues 189 345 462 673 938 +39.4 
Online on demand film revenues 58.9 116.6 185.9 372.1 588.0 +58.0 
Total 248 462 648 1,045 1,526 46.1 
Source: European Audiovisual Observatory. 
4.3.2.2  Regulatory regime 
4.90.  At EU level there are three main policy instruments regarding audiovisual services: the 
Audiovisual Media Services Directive (AVMSD) coordi nating member States' policies on audiovisual 
media, which was recently reformed and integrated to a larger cultural support programme, 
Creative Europe; and two communications by the Commission on the control of state aid granted 
respectively to public broadcasters and in support of films and other audiovisual works. 
4.91.  In 2007 the "Television Without Frontiers "(TSF) Directive was replaced by the AVMSD 
which was codified in 201054, and covers both traditional television services (linear services) and 
video–on-demand (non-linear services). It establishes a series of requirements covering the 
identification of media services provider; a prohib ition of incitation to hatred; accessibility for 
people with disabilities; measures for the promot ion of European works; and certain qualitative 
requirements for commercial communications, sponso ring and product placement. It also confirms 
the "country of origin" principle for determining the national law applicable, which was already contained in the TSF Directive. 
4.92.  The AVMSD applies to on-demand services, a slightly lighter regulation (so called 
"graduated approach") in particular regarding the promotion of European works. 
4.93.  For linear services, Articles 16 and 17 of the Directive require that the majority of 
transmission time shall be reserved, where practi cable, for European works and that broadcasters 
shall reserve, where practicable, 10% of thei r transmission time or programming budget to 
European works produced by independent producer s. On the other hand, for non-linear services, 
Article 13 of the Directive leaves a wider discretion to member States on how to promote European 
works. They can, for instance, introduce measur es regarding the share of European works in 
catalogues, measures to ensure the prominence of such works, or impose a financial contribution on video-on-demand service providers for the prod uction and rights acquisition of such works. 
Article 4 of the Directive also allows member States to implement more detailed or stricter rules in 
the fields coordinated by the AVMSD on media serv ice providers under their jurisdiction, provided 
those rules are consistent with the general principles of European Union law. 
4.94.  The implementation of these obligations has given rise to a series of reports, studies and 
documents; in July 2011 the Commission published its revised guidelines for the implementation of 
Articles 16 and 17 of the Directive
55, in May 2012 a report on the implementation of the Directive 
as a whole56, and in September 2012 a report on the im plementation of Articles 13, 16 and 17 of 
the Directive for the promotion of European works.57 In addition, in April 2013 the Commission 
                                               
54 Directive 2010/13/EU of the European Parliame nt and of the Council of 10 March 2010, on the 
coordination of certain provisions la id down by law, regulation or admi nistrative action in Member States 
concerning the provision of audiovisual media services (Audiovisual Media Services Directive). For the full text of the codified directive see: http://eur-lex.europa.eu/legal-con tent/EN/TXT/PDF/?uri=CELEX:32010L0013& 
from=EN . 
55 For the full text of these guidelines see: https://ec.europa.eu/digital-agenda/en/news/revised-
guidelines-monitoring-application-articles-16-and-17-audiovisual-media-services-avms . 
56 First Report from the Commission to the European Parliament, the Council, the European Economic 
and Social Committee and the Commi ttee of the Regions on the application of Directive 2010/13/EU 
"Audiovisual Media Service Directive" Audiovisual Media Services and Connected Devices: "Past and Future Perspectives", COM/2012/0203 final, for the full text of this report see: http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:52012DC0203&from=EN . 
57 First Report on the Application of Articles 13, 16 and 17 of Directive 2010/13/EU for the period 2009 
2010 Promotion of European works in EU scheduled and on demand audiovisual media services, WT/TPR/S/317 • European Union 
 
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  published a green paper on convergence entitled  "Preparing for a fully converged audiovisual 
world: Growth, creation and values58, conducted a public consultation on its basis in the autumn of 
2013, and published in September 2014 the resulting contributions59, an executive document and 
a feedback paper.60 In July 2014 it also published a summary describing the instruments used by 
the various member States to promote European content on non-linear channels entitled 
"Promotion of European Works in Practice".61 All these documents are aimed at preparing the 
assessment of the regulatory fitness of the Di rective planned in 2015 through a REFIT exercise. 
4.95.  The main findings of these documents can be summarized as follows: 
• the number of linear channels has continued to grow (from 7,522 channels in 2010 to 
8,566 in 2014); 
• local channels were exempted from the promotion obligations of the Directive; in 2010, 
only 1,390 of these channels were subject to the promotion obligations of the Directive, 
i.e. fewer than in 2008 (1,679); 
• the average share of European works shown on  EU TV channels continued to increase 
during the reporting period, to achieve 63.8% in 2009 and 64.3% in 2010. This partially 
offsets the drop registered between 2006  and 2007. The majority proportion of 
European works set out in Article 16 of the AVMSD was therefore largely met. However, 
only 8.1 % of these works were non-domestic; 
• at Member State level the average share of  transmission time devoted to European 
works during the reference period varied between 44% (Ireland) and 83% (Hungary) in 2009, and between 47.4 % (U.K. and Sloven ia) and 81 % (Hungary). The Commission 
has invited the three member States which did not manage to attain the required 
proportion (Ireland, Slovenia and the U.K.) to encourage their broadcasters to show more European works. Two member States which registered below 50% averages 
during the previous reference period, Swed en and Cyprus, were able to reach the 
threshold in 2010. 
4.96.  With an average of 34.1% in 2009 and 33. 8% in 2010 the share of European independent 
works broadcast in the EU was well above the 10%  proportion laid down in Article 17 of the 
AVMSD. However, independent works show a moderate but steady downward trend that began in 2006. Recent works registered a slight decrease as well, with 62.1% in 2009, and 61.8% in 2010 of the total volume of European independent works. 
4.97.  Regarding on-demand services the implementation report revealed a certain lack of 
uniformity in implementing the promotion of European content obligation. However, at the time of the issuance of the report (September 2012) the commission considered that the on-demand 
market being still nascent (less than 1% of total TV revenues in 2011) and the degree of 
information hence available so patchy and incomplete that there was no sufficient data to draw any conclusions on the promotion of European work s by on-demand services providers. The report 
could only state that some member States had imposed specific promotion measures and some 
had not, and that, according to the informat ion provided by 14 member States, on-demand 
services reserved a rather high share of thei r programmes for European works (ranging from 
almost 37% to 100% in 2010). In addition, five member States reported financial contributions to 
European productions and six indicated the use of some tools to give prominence to European 
works. 
                                                                                                                                               
COM/2012/0522 final, for the full text of this report see: http://www.ipex.eu/IPEXL-WEB/dossier/document/ 
COM20120522.do . 
58 For the full text of this green paper see: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri= 
COM: 2013:0231:FIN:EN:PDF . 
59 For the full text of these contributions see: http://ec.europa.eu/digital-agenda/en/news/consultation-
green-paper-preparing-fully-converged-audio visual-world-growth-creation-and-values . 
60 For the full text of thes e latter two documents see: https://ec.europa.eu/digital-agenda/en/news/ 
publication-summaries-green-paper-replies . 
61 For the full text of  this summary see: https://ec.europa.eu/digital-agenda/news/promotion-european-
works-practice . WT/TPR/S/317 • European Union 
 
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  4.98.  Further reports and studies by the Commission as well as market developments have 
refined that picture. In particular, the situation described in the document of July 2014 "Promotion 
of European works in practice" is summarized in Table 4.20. 
Table 4.20 Overview of promotion of Europe an content measures adopted by member 
States for video-on-demand services 
Member 
State No 
measures 
in place Share of European 
works in catalogue Use of tools giving 
prominence to 
European works Financial contribution 
Austria X   
Belgium 
(French 
community 
only)  Simple recommendation 
taking into account the 
following criteria: (i) the 
presence of a substantial 
offer of European works or 
the integration of 
specialized catalogues; (ii) 
the diversity of European 
works or the composition 
of thematic catalogues; 
(iii) the period of time 
during which European 
works remain in the 
catalogue (if that is a 
choice of the editor); (iv) 
the attention paid to films 
of European filmmakers or 
to films where the artistic 
and technical team are of 
European origin; (v) the 
period of time during 
which works forming part 
of European film heritage 
are present in the 
catalogue. The recommendation 
suggests the use of 
the following 
instruments: 
advertising inserts and 
other publicity 
measures in the 
electronic programme 
guide or on the 
website, a specific 
section dedicated to 
European works, 
advertising 
programmes on self-
promotional channels, 
magazine articles, 
promotion related to 
specific events 
promoting European 
works (e.g. European 
Film Festivals) X 
Devoted to production, rights 
acquisition or film fund 
acquisition  
Bulgaria X   
Croatia   X 
With progressively 
increasing share   
Cyprus  X  
Czech 
Republic  X 
as an alternative to 
financial contribution X 
As an alternative to share in 
catalogue (option not used so 
far by the operators) 
 
Denmar k X   
Estonia   -Highlighting European 
works, including works 
completed within the 
last five years  
Finland X   
France  X 
With progressively 
increasing share  -Placement of 
information and 
materials promoting 
European programmes 
including in the 
home/front page 
-use of trailers or 
visuals X 
26%of turnover with an 
increasing rate over time 
devoted to production, rights 
acquisition or financing fund 
the hearing and visually 
impaired public 
Germany X   
Greece    
Hungary  X 
  
Ireland X   
Italy  X 
With progressively increasing share  
as an alternative to 
financial contribution X  
Devoted to production, rights acquisition as an alternative 
to share in catalogue(option 
not used so far by the operators) 
Latvia X   
Lithuania  X 
  
Luxembourg X   
Malta  X 
With progressively increasing share   WT/TPR/S/317 • European Union 
 
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  Member 
State No 
measures 
in place Share of European 
works in catalogue Use of tools giving 
prominence to 
European works Financial contribution 
Netherlands X   
Poland  X 
 -Indication of the 
country of origin in the catalogue 
-providing possibilities 
for searching for European programmes -placement of information and 
materials promoting 
European programmes  
Portugal X   
Romania  X 
 -Indication of the 
country of origin in the 
catalogue  
Slovakia   X 
  
Slovenia  X 
as an alternative to 
financial contribution X 
Devoted to production, rights 
acquisition as an alternative to share in catalogue(option not used so far by the operators) 
Spain  X 
  
Sweden X   
United 
Kingdom X   
Source: European Commission document "Promotion of European Works in Practice"; July 2014, compiled in 
a table form by the Secretariat. 
4.99.  The April 2013 green paper "Preparing for a Fully Converged Audiovisual World: Growth, 
Creation and Values", contains some recent data and forecasts on the move towards online consumption of audiovisual content. Connectable TV sets in the EU are expected to grow from 
40.4 million devices at end-2012, to a presence in the majority of EU households by 2016; 
consumer spending on digital videos (movies an d series delivered over the internet) reached 
€364 million in 2011 (+41% as compared to 2010) wi thin a market of physical and digital video 
amounting to €9,493 million; the unmet demand for video-on-demand services from pay–TV 
operators from other member States is estimated to be in the range of €760 to €1,610 million annually; and there were 306 video-on-demand servic e providers in the EU in the third quarter of 
2012.  
4.100.  The EU did not undertake commitments regarding audiovisual services under the GATS nor 
in any of its Free Trade Agreements. The EU is  party to the 2005 UNESCO Convention on the 
Protection and Promotion of the Diversity of Cultural Expressions.
62 
4.101.  At the EU level, the Creative Europe Programme, which has grouped in a "one-stop-shop" 
the previously separated Culture, MEDIA, and MEDIA Mundus programmes, devotes 55% of its total €1.46 billion funding to the support of the audiovisual creation in particular in the following 
areas: capacity building and professional traini ng for audiovisual professionals; development of 
fiction, animations, and creative documentaries for European cinema and television markets and for other platforms; distribution and sales of audiovisual works in and outside Europe; films festivals; funds for the international co-production of films; and audience development to foster 
film literacy. The previous media programme for 2007-13 had a total budget of €755 million. 
4.102.   At the member State level, support measures for audiovisual works are subject, like other 
state aide measures, to the control of the Directorate General for Competition of the Commission 
which has formulated specific rules for the sector. 
                                               
62 For the full text of this convention see: http://portal.unesco.org/en/ev.php-URL_ID=31038&URL_DO 
=DO_TOPIC&URL_SECTION=201.html . WT/TPR/S/317 • European Union 
 
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  4.103.  On 14 November 2013, the European Commission adopted revised criteria for assessing 
under EU state aid rules, member States' support schemes in favour of films and other audiovisual works.
63 The new rules extend the scope of the previo us rules that date back to 2001 and, applied 
only to state aid for film production, to include all phases of an audiovisual work from concept to 
delivery to audiences. The intensity of the aid that can be granted to a film continues to be limited, 
in principle, to 50% of the production budget. Distribution and promotion costs may be supported 
with the same aid intensity. However, coproductions funded by more than one member State may 
now receive aid up to 60% of the production budg et. By contrast there are no limits on aid for 
script writing or film project development, or for difficult audiovisual works, as defined by each member State in accordance with the subsidiarity principle. 
4.104.  Under the new rules, member States ar e still allowed to  impose territorial spending 
conditions on beneficiaries of audiovisual aid measures. Such a restriction to the rules of the EU 
Single Market is justified by the promotion of cultural diversity, which requires the preservation of the resources and know-how of the industry at na tional or local level. The revised rules ensure 
that such territorial obligations remain proportionate to these objectives. In particular, if the aid 
amount is calculated as a percentage of the budget, member States may require that the equivalent of 160% of the aid amount granted is spent in their territory. The Commission also 
continues to accept aid awarded as a percentage of  the expenditure on production activity in the 
granting member State. Member States may also require, independently from the aid amount granted, that a minimum level of production activity  be carried out in their territory as a condition 
to receive the aid. This can never be higher than  50% of the production budget. In all situations, 
as before, no territorial spending obligation can ever exceed 80% of the production budget. 
4.105.  As of 1 July 2014, the Cinema Communication has been supplemented by state aid rules 
on the audiovisual sector in the revised General Block Exemption Regulation.
64 State aid schemes 
for audiovisual works with an annual budget below €50 million will no longer need to be notified to 
the Commission. In this way the Commission aims to reduce the administrative burden and speed up procedures. The compatibility conditions for aid to audiovisual works set out in the GBER are 
based on the Cinema Communication. 
4.106.  The member States support their audiovisual industries in a variety of ways with budgets 
allocated from national tax revenues, contributions from television channels, and in some cases grants from lotteries. All have national film institutes or similar bodies that support their film 
industries. The member States provide an estimated €3 billion per year in film support: €2 billion 
in grants and soft loans, and €1 billion in tax incentives. Around 80% of this is for film production. France, the U.K., Germany, Italy, and Spain offer the majority of this support.
65 
4.107.  Table 4.21 provides more elements at member States level66 on these support regimes. 
                                               
63 Communication from the Commission on State aid for films and other audiovisual works, OJ C 332 of 
15 November 2013, p. 1. See http://eur-lex.europa.eu/legal-con tent/EN/TXT/?uri =CELEX:52013XC1115(01)   
64 Commission Regulation (EU) No. 651/2014 of 17 June 2014 declaring certain categories of aid 
compatible with the internal market in application of Articles 107 and 108 of the Treaty, OJ L 187 of 26 June 2014, p. 1. See http://eur-lex.europa.eu/legal-conte nt/EN/TXT/?qid=1404295693570&uri=CELEX: 
32014R0651 . 
65 Source: http://europa.eu/rapid/press-release_IP-13-1074_en.htm . 
66 Like in many other WTO members (see for instance WT/TPR/S/307 pp. 135-137), sub-federal entities, 
regions and large municipalities have in many instances set up film commissions and films funds. The Korda 
database of the European Audiovisual Observatory ( http://korda.obs.coe.int/ ) maintains a detailed list of those 
funds and film commissions. WT/TPR/S/317 • European Union 
 
- 152 - 
 
  Table 4.21 National audiovisua l support regimes overview 
(€ million) 
 Funds  
 Revenues 
2009a Sources of revenues, 
2009 Spending by type of 
activity 2009 Tax incentives and 
cash rebates schemes
(as of June 2011)b 
Austria 65.1 -Public subsidies: 45.3 
-taxes and contrib: 19.4 -others: 0.2  -Creation/prod: 51.2 
-distribution: 3 -exploitation: 0.9 -promotion: 0.5 -others: 9.7 Film location Austria 
(cash rebate programme) 
Belgium 45.9 -Public subsidies: 32.9 
-taxes and contrib: 12.5 
-others: 0.55 
 -Creation/prod: 43.4 
-distribution: 1.6 
-exploitation: 0.9 
-promotion: 1  
-others: 3.5 Federal tax shelter 
for films 
Bulgaria 6.2 -Public subsidies: 6.2 
-taxes and contrib: 0 
-others: 0 
 -creation/prod: 5.5 
-distribution: 0.1 
-exploitation: 0 
-promotion: 0.2 -others: 0.4  
Cyprus 1.4 -Public subsidies: 1.4 
-taxes and contrib: 0 
-others: 0 -creation/prod: 1.2 
-distribution: 0 
-exploitation: 0 
-promotion: 0.1 
-others: 0.1 
  
Czech 
Republic 17.4 -Public subsidies: 5.4 
-taxes and contrib: 6.1 -others:5.8 -creation/prod: 6.4 
-distribution: 1 -exploitation: 1.9 
-promotion: 1.5 
-others: 6.6  Support programme 
to the film industry (cash rebate 
programme)
 
Denmark 58.5 -Public subsidies: 57.7 
-taxes and contrib: 0 
-others:0.7 -creation/prod: 31.2 
-distribution: 4 
-exploitation: 0.5 
-promotion: 1.4 
-others: 21.4 
  
Estonia 5.4 -Public subsidies: 4.2 
-taxes and contrib: 1.1 -others: 0.1 -creation/prod: 3.8 
-distribution: 0.2 -exploitation: 0.1 
-promotion: 0.1 
-others: 1.2   
Finland 28.9 -Public subsidies: 1.3 
-taxes and contrib: 0 
-others:27.6 -creation/prod: 19.6 
-distribution: 1.5 
-exploitation: 2.6 
-promotion: 0.6 
-others: 4.6  
France 610 -Public subsidies: 69.5 
-taxes and contrib: 540.5 -others: 0.4 -creation/prod: 387.3 
-distribution: 42.3 
-exploitation: 78.7 
-promotion: 27.9 -others: 73.8 -Tax credit for 
cinema and TV - International tax credit (so called C2I) 
-SOFICA (Sociétés de 
Financement du Cinéma) system  
Germany 324.8 -Public subsidies: 180.9 
-taxes and contrib: 110.9 
-others: 32.9 -creation/prod: 217.6 
-distribution: 39.1 
-exploitation: 11.1 
-promotion: 4.3 
-others: 52.7 
 Deutscher 
Filmforderfonds (cash 
rebate programme) 
Greece 5.6 -Public subsidies: 3.1 
-taxes and contrib: 1.9 
-others:0.6 -creation/prod: 5.7 
distribution: 0 
-exploitation: 0 
-promotion: 1.3 -others: 0.1  WT/TPR/S/317 • European Union 
 
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   Funds  
 Revenues 
2009a Sources of revenues, 
2009 Spending by type of 
activity 2009 Tax incentives and 
cash rebates schemes
(as of June 2011)b 
Hungary 19.5 -Public subsidies: 19.2 
-taxes and contrib: 0 
-others: 0.3 -creation/prod: 12.5 
-distribution: 3.2 
-exploitation: 0 
-promotion: 0 
-others: 3.8 
 Tax rebate for 
cinema production 
Ireland 35.8 -Public subsidies: 25.7 
-taxes and contrib: 8.5 -others: 1.6  -creation/prod: 26.9 
-distribution: 0.4 -exploitation: 1.5 -promotion: 0.2 -others: 6 So called "section 
481" of the tax code 
Italy 126.3 -Public subsidies: 123.5 
-taxes and contrib: 0 
-others: 3.7 -creation/prod: 100.9 
-distribution: 1 
-exploitation: 8.3 
-promotion: 7.5 
-others: 27.9 Tax credit/tax shelter 
for production, 
distribution and 
conversion of 
theatres to digital 
technologies  
 
Latvia 3.4 -Public subsidies: 3.3 
-taxes and contrib: 0 -others: 0.1 -creation/prod: 2.7 
-distribution: 0.1 -exploitation: 0 -promotion: 0.2 -others: 0.4  Riga Film Fund (cash 
rebate programme) 
Lithuania 2.6 -Public subsidies: 2 
-taxes and contrib :0 
-others: 0.7 -creation/prod: 2 
-distribution: 0.2 
-exploitation: 0.2 
-promotion: 0.1 
-others: 0.1 
  
Luxembourg 6.5 -Public subsidies: 6.5 
-taxes and contrib: 0 -others: 0 -creation/prod: 5.3 
-distribution: 0.2 -exploitation: 0 -promotion: 0.1 -others: 0.9  Audiovisual 
Investment Certificate(CIAV) system 
Malta - -Public subsidies:- 
-taxes and contrib:- 
-others:- -creation/prod:- 
-distribution:- 
-exploitation:- 
-promotion:- 
-others:- 
 -Tax credit 
-cash rebate 
programme 
Netherlands 70.6 -Public subsidies: 43.9 
-taxes and contrib: 24.1 -others:2.5 -creation/prod: 59.9 
-distribution: 1.1 -exploitation: 0.1 -promotion: 0.1 -others: 9.4   
Poland 35.6 -Public subsidies: 5.1 
-taxes and contrib: 26.5 
-others: 3.9 -creation/prod: 22.8 
-distribution: 1.1 
-exploitation: 0.9 
-promotion: 2 
-others: 8.8 
  
Portugal 34.6 -Public subsidies: 9.7 
-taxes and contrib: 23.9 -others: 0.9 -creation/prod: 8.4 
-distribution: 0.3 -exploitation: 0.2 -promotion: 0 
-others: 25.7 
  
Romania 7.5 -Public subsidies: 
-taxes and contrib: 
-others: -creation/prod: 
-distribution: 
-exploitation: 
-promotion: 
-others:  WT/TPR/S/317 • European Union 
 
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   Funds  
 Revenues 
2009a Sources of revenues, 
2009 Spending by type of 
activity 2009 Tax incentives and 
cash rebates schemes
(as of June 2011)b 
Slovakia 4.3 -Public subsidies: 4.2 
-taxes and contrib: 0 -others: 0.1 -creation/prod: 3.4 
-distribution: 0.1 -exploitation: 0 -promotion: 0 
-others: 0.8 
  
Slovenia 4.3 -Public subsidies: 4.2 
-taxes and contrib: 0 
-others: 0.1 -creation/prod: 4.3 
-distribution: 0 
-exploitation: 0.2 
-promotion: 0.3 
-others: 0.4 
  
Spain 145.3 -Public subsidies: 143.6 
-taxes and contrib: 0.2 -others:1.4 -creation/prod: 101.3 
-distribution: 4.9 -exploitation: 0.2 -promotion: 9.1 
-others: 29.8 Tax rebate for 
production companies constituted as 
Agrupamiento de 
Interès Economico  
Sweden 75.9 -Public subsidies: 48.7 
-taxes and contrib: 20.6 
-others: 6.3 -creation/prod: 43 
-distribution: 3.6 
-exploitation: 2.2 
-promotion: 0.8 
-others: 26.33 
  
United Kingdom 139.9 -Public subsidies: 83.4 
-taxes and contrib: 0.9 -others: 55.4 -creation/prod: 54.7 
-distribution: 3.7 -exploitation: 3 
-promotion: 1 
-others: 87.5  Tax rebate for 
cinema 
EU-27 1,882 -Public subsidies: 930.7 
-taxes and contrib: 797.6 
-others: 146.6 -creation/prod: 1,222.5 
-distribution: 112.5 
-exploitation: 113.7 
-promotion: 60.8 
-others: 369.5  
a Including infra-national level funds. 
b For a more detailed, though non-exhaustive descr iption of those tax incentives and cash rebates 
schemes, see box "focus 4 tax incentives measures in Europe, an overview" in Chapter 3 of "public 
funding for films and audiovisual works in Europe ", Susan Newman-Baudais, European Audiovisual 
Observatory, 2011. 
 Source: Public funding for films and audiovisual wo rks in Europe", Susan Newman-Baudais, European 
Audiovisual Observatory 2011, re-compiled by the Secretariat. 
4.108.  Moreover, most member States maintain some sort of public funding for public service 
broadcasting. In 2009 the Commission adopted a co mmunication on the application of state aid 
rules to public services broadcasters in the light of new technological developments, including the multiplication of distribution  platforms and technologies.
67 This communication requires the 
administration of an ex ante  test in the form of a public consultation held by the member State 
concerned in order for it to assess the impact of a new service on the market and to balance against its value for society, and prevent distortions of competition with private operators. 
4.3.3  Distribution services 
4.3.3.1  Statistical overview 4.109.  In 2011, wholesale and retail trade account ed for 11.2% of GDP in the EU and for 14.8% 
of total employment, making it one of the larges t services sectors of the EU economy. In 2011 
retail trade turnover reached €5.96 trillion and 4. 6% of GDP in the European Union. Employment 
in the sector accounted for nearly 33 million jobs. 
                                               
67 Com (2009).C257/01 of 2 July 2009 final, for the full text of the communication see: 
http://eur-lex. europa.eu/legal-content/ EN/TXT/PDF/?uri=CELE X:52009XC1027(01)&from=EN . WT/TPR/S/317 • European Union 
 
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  4.110.  These global figures cover somewhat different situations among the member States. For 
instance, in 2011 the contribution of retail services to GDP varied from 2.9% in Luxembourg or 3.4% in Germany to 4.9% in Cyprus, with many member States situated around the EU average 
(then 3.5%). 
4.111.  The growth rate of the sector also vari es with the general economic situation of the 
member States and with the degree of maturity of  the distribution sector. Productivity, and hence 
employment, also exhibit significant differenc es: employment in retailing and wholesaling 
represents a maximum of 18% of employment in Greece; and as little as 11% in Finland. 
4.112.  In terms of structure, EU grocery sales represent around 50% of the retail sector 
throughout the EU. In the non-grocery sector, home furniture is the leading category with 11% of total retail sales, followed by health and beauty (including pharmacy) with 9%, and clothing and 
footwear with 8%. E-commerce is growing fast, but from very low initial levelsl: the size of the 
e-commerce market more than doubled between 2009 and 2014 (+119%); but, while it represents an increasing share of the EU retail market, this proportion remains low (6.7% of the 
overall retail market in 2014 against 3.2% in 2009).
68 It is nevertheless significant for specific 
segments such as books, music, second-hand it ems, and travel. There is also an emerging 
tendency towards multi-channel retailing using both internet and physical outlets in variable 
combinations (e.g. the "drive" system for grocery sales). 
4.113.  The tables and charts below provide the main economic indicators for the distribution 
services sector, notably in terms of Foreign Affiliates Trade in Services (i.e. of sales by subsidiaries of foreign companies in the EU for inwards FATS, and sales by subsidiaries of EU companies 
abroad for outward FATS), inward and outward fo reign investment, value added, and employment 
in Table 4.22, and main trading partners in Chart 4.6 and Table 4.23. 
Table 4.22 Wholesale and retail trade; repair  of motor vehicles and motorcycles main 
economic indicators, 2010-12
a 
 2010 2011 2012
Foreign affiliates sales/turnoverb    
  Inward: € in billion 1,000c1,156   
  Outward: € in billion 757 881 .. 
FDId     
Inward (€ in billion)     
  Position 504 561 .. 
  Financial transactions 30 27 .. 
Outward (€ in billion)     
  Position 419 547 .. 
  Financial transactions 26 18 .. 
Inward (% of GDP)     
  Position 4.1 4.4 .. 
  Financial transactions 0.2 0.2 .. 
Outward (% of GDP)     
  Position 3.4 4.3 .. 
  Financial transactions 0.2 0.1 .. 
Value-added (% of value-added of total economy)  11.1 11.2 11.2 
Employmentd     
In 1,000 33,011 33,179 32,996 
Share in total employment (%) 14.8 14.8 14.8 
Share in total employment in services (%) 20.8 20.7 20.6 
.. Not available. 
 a Classified by ISIC, Rev.4 acti vities. Includes wholesale and retail sale (i.e. sale without 
 transformation) of any type of goods and the render ing of services incidental to the sale of these 
 goods. Wholesaling and retailing are the final steps in the distribution of goods. 
                                               
68 Source: Euromonitor database. WT/TPR/S/317 • European Union 
 
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  b FATS inward refers to the sales by foreign af filiates which are located in the EU(28) and are 
 controlled by non-EU(27) entities . FATS outward refers to the sales of affiliates which are established 
 outside the EU(28) and are controlled by EU(27) entities. c Estimate. d Refers to EU27.  Source: WTO estimates based on Eurostat data (throu gh the ITIP, Integrated Trade Intelligence Portal, 
 services statistics module). Viewed at: https://i-tip.wto.org/ services/Search.aspx ; and information 
 provided by the authorities. 
Chart 4.6 EU-28 major extra-EU trading partners of merchanting and other trade-related 
services 
(€ billion) 
01020304050
2010 2011 2012China United States Switzerland
Singapore Russian Federation Turkey
Hong Kong, China RoW
0510152025
2010 2011 2012Switzerland United States Hong Kong, China
China Russian Federation Japan
India RoW
Exports Imports
 
 
Source: WTO-UNCTAD-ITC trade in services database, based on OECD, IMF, EUROSTAT, UNSD and national 
data, July 2014. 
Table 4.23 EU-28 major extra-EU trading pa rtners of merchanting and other trade-
related services a, 2012 
(€ million and % of total)  
Exports Imports 
Partner € million % of total Partner € million % of total
Extra-EU 46,417 100.0 Extra-EU 19,266 100.0 
  China 4,359 9.4   Switzerland 4,356 22.6 
  United States 4,266 9.2   United States 2,943 15.3 
  Switzerland 2,452 5.3   Hong Kong, China 1,563 8.1 
  Singapore 1,980 4.3   China 757 3.9 
  Russian Federation 1,502 3.2   Russian Federation 727 3.8 
  Turkey 1,430 3.1   Japan 697 3.6 
  Hong Kong, China 1,170 2.5   India 462 2.4 
  Canada 1,166 2.5   Singapore 385 2.0 
  Nigeria 1,076 2.3   Norway 344 1.8 
  India 1,065 2.3   Korea, Republic of 323 1.7 
a Merchanting and commissions of agents, commodity brokers etc. Most distribution services are not 
 covered, e.g. for goods the service margin is co vered in the value of goods traded. Merchanting is 
 defined as the purchase of a good by a resident  merchant from a non-resident and the subsequent 
 resale of the good to another non- resident. This can result in negative results (i.e. when the value of 
 the good sold is lower than the initial purchase price by the merchant).  Source: WTO-UNCTAD-ITC trade in services database, based on OECD, IMF, EUROSTAT, UNSD and national 
 data, July 2014. WT/TPR/S/317 • European Union 
 
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  4.114.  The sector is characterized by the growin g importance of large corporations. In the most 
mature EU 15 retail market, the eight biggest companies account for between 50% and 80% of 
the national grocery retail market. The retail market for durable goods (electronics and household appliances) is also characterized by relatively high concentration, with the five largest 
multinational operators accounting for one third of the market. In the clothing and fashion retail 
market there are marked differences among member  States. In the United Kingdom and in Nordic 
countries the combined market shares of large cl othing retailers is well above 80% while in the 
southern member States, it stands at about 40% . The decline in the share of traditional small 
independent retailers is a common phenomenon across the EU, in particular in the grocery sector. A vertical integration tendency coexists with horizontal concentration: wholesale, sourcing and logistics function are increasingly integrated with retail so as to benefit from the efficiencies 
associated with centralized distribution and the benefits of economies of scale in purchasing. This 
has allowed distributors to reap the benefits of globalization by increasingly sourcing abroad. This phenomenon concerns not only the large distributors (which have formed buying groups at 
European level to increase their leverage in prices negotiations) but also smaller retailers that 
have grouped together in franchise networks. Downstream vertical integration touches areas such as design (e.g. for fashion retail where orders are adjusted immediately in function of the demand 
expressed in test shops), and private labels wher e distributors sell goods under their own brand. 
International developments within and outside EU, as shown in the outward FDI statistics above, is also a major trend as well as diversification into other sectors, such as financial services, travel, mobile phone, and even energy. 
4.3.3.2  Regulatory framework 
4.115.  Distribution services are essentially regulated at the member State level by a mix of 
regulation at the national level (labour laws, competition, establishment rules, zoning) and of local, 
mostly municipal, rules (in particular on establishment and zoning). There is also an EU–wide level 
of regulation beyond the traditional area of competition, as retail, being a service, falls within the ambit of the Services Directive. The general prohib ition of economic needs tests and the principles 
relating to authorization procedures and criteria established by the 2006 Services Directive
69 have 
been of particular relevance for the retail sector . The transposition of the Services Directive was 
finalized in 2009 and it fully benefits third country  retailers provided they are established within 
the EU. 
4.116.  The Communication on the implementation of the Services Directive70 indicated that the 
absolute prohibition contained in Article 14(5) does not concern planning requirements that serve overriding reasons relating to the public interest. Sometimes these planning requirements take 
into account economic data such as demand and supply figures. In those cases, the use of 
economic data and criteria can be justified if the restrictions are necessary and proportionate. 
4.117.  Therefore the qualification as an economic needs test within the meaning of Article 14(5) 
needs to be carefully assessed. It cannot apply automatically to all requests for economic data. 
The Commission is currently engaged in a peer review with the member States which aims to establish best practices in retail establishment. "Competition tests" aimed at assessing local market shares can also be found in various forms. Those competition tests have to abide by the 
rules set by Article 10(2) of the Directive whereb y all the criteria for granting an authorization 
should be non-discriminatory, justified by an overriding economic reason relating to the public interest, be proportionate to the public interest ob jective, and be based on objective criteria made 
public in advance. Some member States provide for national rules or guidelines for those criteria 
whereas in other member States these are defined at regional or even local level. Concerning the scope of regulations, some apply only to certain submarkets or foresee different provisions 
according to the relevant retail submarket. Therefore, some authorization schemes or attributions 
of building permits apply only to retail outlets above a certain threshold specified in square metres but then have derogations, such as for "do- it-yourself" (DIY) shops or garden centres. 
                                               
69 Article 14 paragraph 5 for the prohibition of econ omic needs test and article 10 paragraph 2 for the 
authorization conditions of Directive 2006/123 of 12 December 2006 on Services in the Internal Market", so-called "Services Directive, for the full text of the Directive see: http://eur-lex.europa.eu/LexUriServ/ 
LexUriSerdo?uri=OJ:L:2006:376:0036:0068:fr:PDF . 
70 Com (2012) 262 final, dated 8 June 2012, Communication on the Implementation of the Services 
Directive, a Partnership for New Growth in Services 2012-2015. Viewed at: http://ec.europa.eu/internal_ 
market/services/docs/services-dir/implementation/report/COM_2012_261_en.pdf . WT/TPR/S/317 • European Union 
 
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  4.118.  According to the Commission, while the Services Directive has contributed to simplifying 
authorization procedures, their complexity, their length and their cost still varies between and within member States. Similarly while the Services Directive has ensured that applications are dealt with more objectively, there are still problems in practice at local level. 
4.119.  At national level, member States generally provide for different types of authorizations for 
the opening of retail outlets. Some relate to the compliance of the premises with defined requirements or are linked to the sale of certain products (food, alcohol, tobacco, etc.) others are 
directly linked to the retail activity. As far as th e type of authorization is concerned, two groups of 
member States can be distinguished: on the one hand, member States such as Germany, Ireland, 
the Netherlands, Poland, Slovakia, and Slovenia, that rely on general planning provisions and building permits, and which at times resort to partnerships between private investors and public 
authorities, and, on the other hand, member States such as Romania, Italy, Austria, Belgium, 
Spain, France, and Greece which apply, in addi tion to the planning provisions/and building 
permits, a specific prior authorization procedure to establish retail outlets. There are further 
differences within these two groups and priorities may vary: the protection of the environment, 
the vitality of city centres, diversity of offers etc.  
4.120.  Secondly, regarding distance selling, there is a specific legal framework both at national 
and EU levels, the latter paying particular attention to cross-border provision of distribution 
services. A number of Directives have set up a general framework for EU consumer protection 
based on minimum harmonization with the aim of enhancing consumer confidence also in distance and direct selling, including e-commerce.
71 Specific rules for distance and direct selling are laid 
down in the Consumer Rights Directive (2011/83/EU), which provides common rights for 
consumers and establishes common obligations for retailers throughout Europe for these sales channels. This Directive became applicable in June 2014 and has been transposed in all member 
States. As a result, the member States' national legislation may diverge fr om the Directive only 
where this is specifically authorized. 
4.121.  As regards e-commerce in particular, the Directive on electronic commerce
72 sets down 
common rules on the establishment, information requirements, commercial communications, 
liability of intermediaries, and pre-contractual requirements necessary for the starting up and development of cross-border information society services as well as applying the country of origin control principle. It is worth noting that the country of origin principle does not apply to contractual 
obligations in consumer contracts and the e-commerce Directive does not cover the issue of 
differing national taxation regimes or the other main obstacles to cross-border retailing of physical goods. 
4.122.  Outstanding hindrances to the internal ma rket have been identified by the Commission as 
undermining cross-border online trade and this will be a core issue for the DSM (Digital Single Market) package which is one if the Commission's top ten policy objectives, as laid out in the 
Commission's 2015 Work Programme.
73 
4.123.  Another set of rules which can have an impact on retailers' establishment strategies and 
their capacity to survive and perform in terms of accessibility and affordability concern independent retailers' networks. The possibility for independent retailers to be organized into 
networks is often crucial. In order to survive, they may need to be able to jo in or be organized into 
groups (such as cooperative or franchise groups) that have upstream purchasing power. Networks can be developed both at the national and EU leve l (for example buying groups of small retailers). 
There is no specific harmonization of the creation and running of distribution networks at Union 
level. However, since the organization of non-integrated retailers' networks is based on a series of cooperation agreements between independent retailers (e.g. cooperatives) or between retailers 
a n d  s u p p l i e r s  ( e . g .  f r a n c h i s e  n e t w o r k s ) ,  t h e y  c a n  f a l l  w i t h i n  t h e  s c o p e  o f  E u r o p e a n  o r  n a t i o n a l  
                                               
71 Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts; Directive 1999/44/EC of 
the European Parliament and of the Council of 25 May 1999 on certain aspects of the sale of consumer goods 
and associated guarantees; Direct ive 98/6/EC of the European Parliament and of the Council of 
16 February 1998 on consumer protection in the indication of the prices of products offered to consumers. 
72 Directive 2000/31/EC of the European Parliament an d of the Council of 8 June 2000 on certain legal 
aspects of information society services, in particular electronic commerce, in  the Internal Market (Directive on 
electronic commerce), OJEC 17.7.2000, L178/1, for the full text of the directive see: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32000L0031:en:HTML . 
73 Commission Work Programme 2015 - A New Start, COM(2014) 910 final. WT/TPR/S/317 • European Union 
 
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  competition rules. In fact, the importance and specificity of these distribution networks have been 
recognized by European competition rules applicable to horizontal and vertical agreements through the elaboration of Block Exemption Regulations and Guidelines as described in more detail in the competition policy section. 
4.124.  On 31 January 2013, the Commission adopte d its European Retail Action Plan (ERAP).
74 
The Plan describes the challenges faced by the sector (financial crisis, ageing population, 
development of e-commerce, sustainability challenges and remaining regulatory barriers to a 
better functioning of the internal market) and suggests a series of actions, mostly of a non-
legislative nature, to address these challenges: how to improve consumer access to transparent and reliable information; tackling business to business unfair practices in the food supply chain; identification of  best practices in retail establishment; a zero-tolerance policy for member States' 
restrictions clearly infringing the Services Directiv e; assessing the feasibility of creating a database 
on all EU and national level labelling rules and requirements; sustainability; innovation; promoting cards; internet and mobile payments in order to ensure better market integration; and 
encouraging retailers training and re-skilling policies. Based on the ERAP the Commission has 
launched a series of consultations with stakeholders and intends to report on the state of implementation of the ERAP in the course of 2015. 
4.125.  Following the ERAP and its consultation on unfair trading practices, in July 2014 the 
Commission adopted a green paper on Communication on Tackling unfair trading practices in the business-to-business food supply chain.
75 The Communication suggests actions for market 
participants and member States. In particular, the Communication calls on member States to 
assess the effectiveness of their mechanisms for the enforcement of rules against unfair trading 
practices.76 
4.126.  In line with the ERAP, a High Level Group of Retail Competitiveness has been set up to 
advise the Commission on retail policy. It is composed of a wide range of stakeholders in the retail 
chain.77 
4.127.  Regarding international obligations of the EU for trade in distribution services, the GATS 
commitments of the EU are substantial and cover all types of distribution as well as virtually all 
products. Nevertheless, they contain a certain num ber of restrictions by member States, notably 
on specific products such as tobacco, firearms, and pharmaceuticals as well as on establishment procedures. To a large extent, the Services Directive has had a positive effect ergaomnes  which is 
in turn largely reflected in posterior FTAs concluded by the EU
78 as evidenced by the indexes 
contained in the WTO Staff Working Paper "Services Trade in Preferential Trade Agreements, a Dataset" which are of 72 (on 100 possible points) for GATS commitments in distribution services 
and of 88 for the best FTA signed by the EU.
79 
4.3.4  Financial services 4.128.  During the period under review the European Union has pursued the adoption and 
discussion of the large-scale packages of legislat ive proposals that the Commission had formulated 
in the aftermath of the financial crisis and that were described in detail in the previous Review, 
                                               
74 Commission (2013), Setting up a European Retail Action Plan,  Communication from the Commission 
to the European Parliament, the Coun cil, the European Econ omic and Social Committ ee and the Committee on 
the Regions; COM(2013)36 final. 
75 Commission (2014), Tackling unfair trading practices in the business-to-business food supply chain, 
Communication from the Commission to  the European Parliame nt, the Council, the European Economic and 
Social Committee and the Committee on the Regions, COM(2014) 472 final. 
76 See also the report commissioned by the Euro pean Commission: EY, Cambridge Econometrics Ltd, 
Arcadia International (2014), The economic impact of modern retail on  choice and innovation in the EU food 
sector,  September, Publications  of the EU, Luxembourg. 
77 Commission online information. Viewed at:  
http://ec.europa.eu/transparency/regexpert/index.c fm?do=groupDetail.groupDetail&groupID=2970&NewSearc
h=1&NewSearch=1&Lang=EN.  
78 For a detailed description of EU commitments in distribution services both under the GATS and in 
FTAs see the I-tip services database https://i-tip.wto.org/services/(S(jq1in3tsyictjkggvze3txbu))/default.aspx . 
79 For more information on this dataset see: 
http://www.wto.org/english/tratop_e/serv_e/dataset_/dataset_e.htm . WT/TPR/S/317 • European Union 
 
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  together with structure of the sector.80 During the review period for this report, the Commission 
has complemented these packages with new proposal s, some of which have already been adopted. 
4.129.  The Commission grou ps these new regulations, directives  and drafts in three pillars: the 
first pillar aimed at building new rules for the global financial system; the second pillar aimed at 
establishing a safer, responsible, and growth-enha ncing financial sector in Europe; and the third 
pillar working towards the completion of the Banking Union to strengthen the euro. 
4.3.4.1  Legislations aimed at building ne w rules for the global financial system 
4.130.  Under the first pillar the Commission includes Regulation (EU) No. 648/2012 on over-the-
counter (OTC) derivatives, central counterparties and trade repositories (the European Market 
Infrastructure Regulation (EMIR)). The objectives of EMIR are to increase transparency in the OTC derivatives market, and to make it safer by reducing counterparty credit risk and operational risk. 
To increase transparency, the new rules require that (i) detailed information on OTC derivative 
contracts entered into by EU financial and non-financial firms be reported to trade repositories and made accessible to supervisory authorities, and (i i) trade repositories publish aggregate positions 
by class of derivatives accessible to all market participants. In the course of the negotiations, the 
scope of the proposal was widened to cover the reporting of both listed (i.e. non-OTC) and OTC derivatives. To reduce counterparty credit risk, the new rules introduce (i) stringent prudential 
rules (e.g. how much capital they need to possess) , organizational (e.g. role  of risk committees), 
and conduct of business standards (e.g. disclosure of prices) for central counterparties, (ii) mandatory central counterparties clearing for contracts that have been standardized (i.e. they have met predefined eligibility criteria), (iii) risk-mitigation standards for contracts not cleared by 
a CCP (e.g. exchange of collateral). Finally, to redu ce operational risk (i.e. the risk of loss resulting 
from inadequate or failed internal processes, pe ople and systems, or from external events) the 
proposal requires the use of electronic means fo r the timely confirmation of the terms of OTC 
derivatives contracts. This allows counterparties to net the confirmed transaction against other 
transactions and ensure accurate bookkeeping. 
4.131.  A second element of the first pillar is Directive 2014/49/EU on deposit guarantee schemes 
(DGS) which amends and recasts a previous directive. It ensures depositors will continue to 
benefit from a guaranteed coverage of €100,000 in  case of bankruptcy backed by funds to be 
collected in advance from the banking sector. It creates, for the first time since the introduction of the guarantee scheme in 1994, financing requir ements under which: the target level for ex ante  
funds of DGS has been set to 0.8% of covered depo sits (i.e. about €55 billion) to be collected from 
banks over a 10-year period. In addition, access to the guaranteed amount will be easier and faster as repayment deadlines will be gradually reduced from the current 20 working days to 
7 working days in 2024. 
4.132.  One of the effects of these new rules is to give EU citizens the choice of the best savings 
products available in any EU country without worry ing about differences in the level of protection. 
The new Directive also requires financial institutions to provide better information to depositors to 
ensure that they are aware of how their depo sits are protected by the guarantee schemes. 
4.133.  The third element of the first pillar is Regulation (EU) No. 462/2013 and Directive 
2013/14/EU on credit-rating agencies (CRAs).
81 The rules set out in the Regulation and Directive 
pursue five distinct objectives. The first objective is to reduce overreliance on credit ratings, in 
particular on external ratings, by requiring financial institutions to strengthen their own credit risk assessment. European supervisory authorities are re quested to avoid references to external credit 
ratings
82 and will be required to review their rule s and guidelines and, where appropriate, to 
                                               
80 WTO document WT/TPR/S/284/Rev.2, section 4.3.1, 28 November 2013. 
81 Regulation EU No. 462/2013 of the European Parliament and of the Council of 21 May 2013 amending 
regulation (EC) No. 1060/2009 on credit-rating agencies ; Directive 2013/14/EU of the European Parliament 
and of the Council of 21 May 2013 amending Directive 2003/41/EC on the activities and supervision of institutions for occupational retirement provision;  Directive 2009/65/EC on the coordination of laws, 
regulations and administrative provisions relating to un dertakings for collective in vestment in transferable 
securities (UCITS); and Directive 2011/61/EU on alternat ive investment funds managers in respect of over-
reliance on credit ratings. 
82 Detailed guidelines were issued in that regard, see: https://www.eba.europa.eu/regulation-and-
policy/external-credit-assessment-institutions-ecai/discu ssion-paper-on-the-use-of-credit-ratings-by-financial-
intermediaries  WT/TPR/S/317 • European Union 
 
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  remove credit ratings where they have the potent ial to create "mechanistic effects". The second 
objective is to improve the quality of ratings of sovereign debt of EU member States. To achieve 
this objective and to avoid market disruption, rating agencies will set up a calendar indicating when they will rate member States and which will be limited to three per year for unsolicited 
sovereign ratings. Deviations remain possible in exceptional circumstances and when appropriately 
explained. These ratings will only be published after the close of business and at least one hour 
before the opening of trading venues in the EU. Fu rthermore, investors and member States will be 
informed of the underlying facts and assumptions on each rating which will facilitate a better 
understanding of credit ratings in member States. 
4.134.  The third objective of the CRA legislations is to make credit-rating agencies more 
accountable for their actions by holding a rating agency liable in cases where it infringes 
intentionally or with gross negligence the CRA Regulation, thereby causing damage to an investor 
or an issuer. The fourth objective is to reduce conflicts of interest due to the issuers' remuneration model. To do so the regulation introduces a mandatory rotation for some complex structured 
financial instruments, re-securitization, and limitations to the shareholding of rating agencies. To 
mitigate the risk of conflicts of interest, the new rules also require CRAs to disclose publicly if a shareholder with 5% or more of the capital or voting rights holds 5% or more of a rated entity, 
and prohibit a shareholder of a CRA with 10% or mo re of the capital or voting rights from holding 
10% or more of a rated entity. To ensure the diversity and independence of credit ratings and opinions, the regulation prohibits ownership of 5% or more of the capital or the voting rights in 
more than one CRA, unless the agencies concerned belong to the same group (cross-
shareholding). The fifth objective of the CRA legislations is the publication of ratings on a European 
Rating Platform in order to improve comparability and visibility of all ratings for any financial instrument rated by rating agencies registered and authorized in the EU. This is also meant to help 
investors make their own credit risk assessment and contribute to more diversity in the rating 
industry. As part of the package, the Commission will also review the situation in the rating market and report to the European Parliament and the Council with regard to the feasibility of 
creditworthiness assessments of sovereign debt of EU member States and a European credit rating 
Foundation. 
4.135.  The fourth element of the first pillar is  the so-called "single rulebook" of prudential 
requirements for banks' capital, liquidity and leverage and stricter rules on remuneration and 
improved transparency which is contained in Re gulation (EU) No. 575/2013 and Regulation (EU) 
No. 648/2012 (the Capital Regulation Requirement (CRR))
83, and Directive 2013/36/EU 
(CRD IV).84 The single rulebook is essentially a transposition of the Basel III standards, but it 
extends them beyond the "internationally active banks" targeted by those standards, to include 
investment firms. In addition to the Basel III rules (better and more capital, more balanced 
liquidity, leverage limitations, capital requirements for derivatives and so-called counter-party 
credit risk and capital buffers), the package in troduces a number of important changes to the 
banking regulatory framework. The Directive streng thens the relationship between the variable (or 
bonus) component of remuneration and the fixe d component (or salary). From 1 January 2014 
onwards, the variable component of total rem uneration shall not exceed 100% of the fixed 
component of the total remuneration of material risk-takers so as not to reward irresponsible 
risk-taking. Exceptionally, and under certain cond itions, shareholders may increase this maximum 
ratio to 200%. The Directive also strengthens the requirements with regard to corporate 
governance arrangements and processes and introduces new rules aimed at increasing the 
effectiveness of risk oversight by boards, improv ing the status of the risk-management function, 
and ensuring effective monitoring by supervisors of risk governance.  
4.136.  Based on the assumption that diversity in board composition should contribute to effective 
risk oversight by boards, prov iding for a broader range of vi ews and opinion and therefore 
avoiding the phenomenon of group-think, the Di rective introduces a number of requirements, in 
particular as regards gender balance. The Dire ctive also improves transparency regarding the 
activities of banks and investment funds in different countries, in particular as regards profits, 
                                               
83 Regulation (EU) No. 575/2013 of the European Pa rliament and of the Council of 26 June 2013 on 
prudential requirements for credit institutions an d investment firms and am ending Regulation (EU) 
No. 648/2012. 
84 Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the 
activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC . WT/TPR/S/317 • European Union 
 
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  taxes, and subsidies in different jurisdictions. This is aimed at regaining the trust of EU citizens in 
the financial sector. Finally, in addition to the various capital-buffers foreseen by the Basel III standards, the directive institutes two additional buffers, namely a "systemic risk buffer" and an "other systemic institution buffer". 
4.137.  The Regulation creates the so-called “singl e rulebook” i.e. the single set of harmonized 
prudential rules which banks throughout the EU mu st respect. EU heads of state and government 
had called for a "single rulebook" in the wake of the crisis. It is aimed at ensuring uniform 
application of Basel III in all member States, at closing regulatory loopholes, and thus at 
contributing to a more effective functioning of the internal market. The new rules remove a large number of national options and discretions from the CRD, and allow member States to apply stricter requirements only where these are justified by national circumstances (e.g. real estate), 
needed on financial stability grounds or because of a bank's specific risk profile.
85 
4.138.  The fifth element of the first pillar is th e enhanced framework for securities' market and is 
composed of Directive 2014/65/EU on markets in financial instruments (MIFID 2)86, and 
Regulation (EU) No. 600/2014 on markets in financial instruments (MIFIR).87 
4.139.  The MIFID/R package first introduces a market structure framework which ensures that 
wherever appropriate, trading takes place on regulated platforms. It further ensures that 
investment firms operating an internal matching system which executes client orders in shares, 
depositary receipts, exchange-traded funds, certificates and other similar financial instruments on a multilateral basis must be authorized as a multilateral trading facility (MTF). It also introduces a new multilateral trading venue, the Organised Trading Facility (OTF), for non-equity instruments to 
trade on organized multilateral trading platforms. The neutrality of OTF operators is ensured 
through restrictions on the use of own-capital, including matched principal trading, and restrictions on the circumstances in which they can exercise discretion in their execution policy. Second, 
MIFID2 increases equity and non-equity market transparency notably by the obligation for trading 
venues to make pre- and post-trade data available on a reasonable commercial basis and through the establishment of a consolidated tape mechanism for post-trade data. These rules are 
accompanied by the establishment of an approved  reporting mechanism (ARM) and an authorized 
publication arrangement (APA) for trade reporting and publication. Third, MIFID2 provides for 
strengthened supervisory powers and a harmon ized position-limits regime for commodity 
derivatives to improve transparency, support orderly pricing and prevent market abuse. 
4.140.  Fourth, the MIFID/R establishes a harmonized EU regime for non-discriminatory access to 
trading venues and central counterparties (CCPs) . Smaller trading venues and newly-established 
CCP will benefit from optional transition periods. Fifth, it introduces trading controls for algorithmic 
trading activities. These safeguards include the requirement for all algorithmic traders to be 
properly regulated and to provide liquidity when pursuing a market-making strategy. In addition, 
investment firms which provide clients with direct electronic access to a trading venue will be 
required to have in place systems and risk controls to prevent trading by clients that may 
contribute to a disorderly market or involve market abuse. Sixth it provides for reinforced investor protection achieved by introducing better orga nizational requirements, such as client-asset-
protection or product-governance, which also strengthens the role of management bodies. The 
new regime also provides for strengthened conduct rules such as an extended scope for the 
appropriateness tests and reinforced information to clients. Additionally, it institutes a harmonized regime of administrative sanctions. Finally, rega rding access to the EU markets for firms from third 
countries, it institutes a harmonized regime based on an equivalence assessment of third-country 
jurisdictions by the Commission. The regime applies only to the cross-border provision of investment services and activities provided to professional and eligible counterparties. For a 
transitional period of three years and pending equivalence decisions by the Commission, national 
third-country regimes continue to apply. 
                                               
85 For a detailed description of the rules contai ned in the "single ruleb ook" see, for instance: 
http://www.eba.europa.eu/regulation-and-policy/single-rulebook . 
86 Directive 2014/65/EU of the European Parliament  and of the Council of 15 May 2014 on markets in 
financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU. 
87 Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 on 
markets in financial instruments and amending Regulation (EU) No. 648/2012. WT/TPR/S/317 • European Union 
 
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  4.141.  The sixth element of the first pillar is the enhanced framework to prevent market abuse, 
so-called MAD/R, which is itself composed of a directive, so-called MAD88 and of a regulation, so-
called MAR.89 This package is aimed at fighting insider- dealing and market-manipulation as well as 
updating and strengthening the existing rules and ensuring minimal criminal sanctions for market 
abuse. The scope of the market-abuse provisions is now extended to all financial instruments 
which are traded on organized platforms and over-the-counter, and the rules have been adapted to new technologies. They now explicitly ban the manipulation of benchmarks such as EURIBOR 
and LIBOR and reinforce the cooperation between financial and commodity-regulators. Sanctions 
foreseen are tougher and more harmonized than in the previous regulatory setting. 
4.142.  The seventh element of the first pillar is the Bank Recovery and Resolution Directive, 
BRRD.
90 It harmonizes and upgrades the tools for dealing with bank crises across the EU. Banks 
will be required to prepare recovery plans to over come financial distress, while authorities will lay 
out plans to resolve failed banks in a way which preserves their most critical functions and avoids taxpayers having to bail them out. Authorities are granted a set of powers to intervene in the 
operations of banks to avoid them failing. If they do face failure, authorities are equipped by the 
directive with new comprehensive powers and tools to restructure them, allocating losses to shareholders and creditors following a clearly defined hierarchy. 
4.143.  National resolution funds are set up, to be replaced for euro Area member States by the 
Single Resolution Fund as of 2016. The directive sets out precise arrangements for how home and host authorities of banking groups are to cooperate in all stages of cross-border resolution, from resolution planning to resolution itself, with a strong role for the European Banking Authority to 
coordinate and mediate in case of disagreements. Th e rulebook set out in the BRRD will be further 
complemented by technical rules to be develo ped by the European Banking Authority on, for 
instance, concrete information requirements for recovery and resolution plans and securing 
accurate valuations of assets and losses at the point of resolution. 
4.144.  In addition to these adopted legislations, the commission has completed the first pillar by a 
communication on shadow banking
91 and two new legislative proposals, as yet unadopted, namely 
a proposal on money market funds92 in September 2013, a regulation on  structural measures 
improving the resilience of EU credit institutions93 in January 2014 and a Proposal for a Regulation 
on Reporting and Transparency of Securities Financing Transactions.94 
4.3.4.2  Legislations aimed at establishing  a safe, responsible and growth enhancing 
financial sector in Europe 
4.145.  The second pillar of the post-financial cris is regulatory packages is aimed at "establishing a 
safe, responsible and growth-enhancing financial sector in Europe", it is composed of six legislative 
elements adopted since the previous Review and six legislative elements as yet unadopted. 
                                               
88 Directive 2014/57/EU of the European Parliament  and of the Council of 16 April 2014 on criminal 
sanctions for market abuse (market abuse directive). 
89 Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on 
market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC. 
90 Directive 2014/59/EU of the European Par liament and of the Council of 15 April 2014  establishing a 
framework for the recovery and resolution of credit institutions and investment  firms and amending Council 
Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No. 1093/2010 and (EU) No. 648/2012, of the European Parliament and of the Council.  
91 Communication from the Commission to the Counci l and the European Parliament "Shadow Banking – 
Addressing New Sources of Risk in the Financial Sector",  COM/2013/0614 final. Viewed at: http://eur-
lex.europa.eu/legal-content/EN/T XT/PDF/?uri=CELEX:52013DC0614&from=EN . 
92 Proposal for a Regulation of the European Parlia ment and of the Council on Money Market Funds, 
COM/2013/0615 final - 2013/0306 (COD) of 4 September 2013. Viewed at:  http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:52013PC0615&from=EN . 
93 Proposal for a Regulation of the European Parlia ment and of the Council on Structural Measures 
Improving the Resilience of EU Credit Institutions, Com (2014) 43 final of 29 January 2014. Viewed at: http://eur-lex.europa.eu/legal-content /EN/TXT/PDF/?uri=CELEX:52014PC0043&from=EN . 
94 Proposal for a Regulation of the European Pa rliament and of the Council on Reporting and 
Transparency of Securities Financing Transactions, COM(2014)040 final of 29 January 2014 ,viewed at : 
http://eur-lex.europa.eu/legal-content /EN/TXT/HTML/?uri=CELEX:52014PC0040&from=EN . WT/TPR/S/317 • European Union 
 
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  4.146.  The first adopted element of this second pillar is the ne w European supervisory framework 
for insurers, so-called Omnibus II95 adopted in April 2014. The directive is called Omnibus II 
because an earlier Directive, known as "Omnibus I" enacted technical amendments to 11 Directives incorporating into banking and securities directives references to the European 
Supervisory Authorities (the European Banking Authority (EBA) and the European Securities and 
Markets Authority (ESMA)), thus operationalizing their powers as granted in their founding directives. Omnibus II does the same for the insura nce sector, operationalizing the powers of the 
European Insurance and Occupational Pensions Authority (EIOPA) via changes to the Solvency II 
Directive.  
4.147.  It was decided in the course of the legislative process to also include in Omnibus II 
elements changing some substantive aspects of the Solvency II regime. These amendments 
include the provision of specific tasks for EIOPA and for ESMA. In particular, it clarifies the role of 
EIOPA in ensuring harmonised technical approaches for the calculation of technical provisions and capital requirements. In addition it defines the a ppropriate areas in which EIOPA (for Solvency II) 
and ESMA (for the Prospectus Directive) will be able to propose technical standards as an 
additional tool for supervisory convergence and a vi ew to developing a single rulebook to ensure 
strengthened stability, equal treatment, lower compliance costs and to prevent regulatory 
arbitrage. It also details how EIOPA and ES MA will settle disagreements between national 
supervisors in a balanced way, in those areas where common decision-making processes or cooperation between national supervisors already ex ist in sectoral legislation. Furthermore, the 
Omnibus II Directive contains a package of measures to provide clarity on the treatment of 
insurance products with long-term guarantees in order to mitigate the effects of artificial volatility. 
These measures include: a matching adjustment, a volatility adjustment, extrapolation of the risk-
free interest rate, two specific transitional measur es, and extension of the recovery period. In this 
way the Directive ensures that the insurance industry can continue offering long-term guaranteed 
products.  
4.148.  Finally, the Omnibus II Directive also contains transitional measures in certain areas 
including on transitional third-country equivalence if deemed necessary to avoid market disruption 
and to allow a smooth transition to the new regime under Solvency II. 
4.149.  The second adopted element of the second pillar is the Directive on disclosure of non-
financial and diversity information by large companies and groups.
96 Companies concerned will 
need to disclose information on policies, risks and results as regards environmental matters, social 
and employee-related aspects, respect for human rights, anti-corruption and bribery issues, and 
diversity on boards of directors. The Directive gives companies significant flexibility to disclose 
relevant information in the way that they consider most useful, or in a separate report. Companies 
may use international, European or national gu idelines which they consider appropriate (for 
instance, the UN Global Compact, ISO 26000, or the German Sustainability Code). The new rules 
will only apply to large companies with more than  500 employees. This Directive also represents a 
first step towards the implementation of the European Council conclusions of 22 May 2013 on the need for further transparency on tax matters and for ensuring country-by-country reporting by large companies and groups.  
4.150.  The third adopted element of the second pi llar is the Directive on the transparency and 
comparability of payment account fees, payment account switching and access to a basic payment account.
97 This Directive guarantees three basic rights  for consumers. The first such right is the 
right of access to payment account: all EU consumers, without being residents of the country 
                                               
95 Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending 
Directives 2003/71/EC and 2009/138/EC and regulati ons (EC) No. 1060/2009, (EU) No. 1094/2010 and (EU) 
No. 1095/2010 in respect of the powers of the European  Insurance and Occupational Pensions Authority 
(EIOPA) and of the European Securities and Markets Authority. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:32014L0051&from=EN . 
96 Directive 2014/95/EU of the European Parliament and of the Council of 22 October 2014 amending 
Directive 2013/34/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups. Viewed at : http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:32014L0095&from=EN   
97 Directive 2014/92/EU of the European Parliame nt and of the Council of 23 July 2014 on the 
comparability of fees related to payment accounts, payment account switching and access to payment 
accounts with basic features. Viewed at: http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32014L0092&from=EN . WT/TPR/S/317 • European Union 
 
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  where the credit institution is located and irrespective of their financial situation, have a right to 
open a payment account that allows them to perform essential operations, such as receiving their salary, pensions and allowances or payment of utility bills etc. The second right is the comparability of payment account fees. The third is the right to switch payment account through 
the establishment of a simple and quick procedure for consumers who wish to switch their 
payment account to one with another payment service provider within the same Member State and to assist consumers who hold a payment account with a bank and want to open another account in 
a different country. The Directive provides for further work by the Commission to develop 
guidelines in order to facilitate the disclosure of non-financial information by companies, taking into account the best current practice, international developments and related EU initiatives. 
4.151.  The fourth adopte d element of the second  pillar are two Regulati ons on venture capital 
funds
98 and on European social entrepreneurship funds.99 The Regulations create a special EU 
passport for all operators that invest in start-up SMEs and social businesses. Once a set of requirements is met, fund managers can market their funds to professional investors and high-
net-worth individuals across the EU, without the need to be fully authorized under the Alternative 
Investment Fund Managers Directive. Two new fund  labels were created, one for venture capital 
funds investing in unlisted SMEs (EuVECA), the other for funds investing in social businesses 
(EuSEF). Under the new rules, fund managers will need to register with the competent authority in 
their home member State, but will then be able to market their venture capital and social entrepreneurship funds throughout the whole of the EU. 
4.152.  The fifth adopted element of the second pi llar is the Regulation on key information for 
Packaged Retail and Insurance-Based Investment Products (so-called PRIIPs).
100 The Regulation 
institutes a new pre-contractual information document for retail consumers. This document will have to be given to all retail consumers before they buy an investment product offered to them by 
a bank, an insurance company or an investment fund. The new information document will have to 
indicate what the product invests in, what its risks and potential rewards are and what total costs will come the consumers' way in the course of the product's life cycle. 
4.153.  The sixth and last adopted element of the se cond pillar is the Directive on the coordination 
of laws, regulations and administrative provisions relating to undertakings for collective investment 
in transferable securities (UCITS V).
101 The new rules are aimed at strengthening the protection of 
investors vis-à-vis  managers of UCITS funds and their depositaries. In order to do so UCITS V first 
strengthens the rules on eligible entities that can act as a depositary. Only national central banks, 
credit institutions and regulated firms with sufficient capital and adequate infrastructure will be eligible as UCITS depositaries and will hold for safe-keeping all UCITS assets. Second, UCITS 
assets will be protected in the event of insolven cy of the depositary through clear segregation 
rules and safeguards provided by the insolvency la w of the member States. Third, the depositary's 
liability has been strengthened. The depositary will be liable for any loss of UCITS assets held in 
custody. Unlike under the AIFMD, this liability cannot be contractually discharged. The UCITS 
investors will always have the right of redress directly against the depositary and will not have to rely on the management company's ability to accomplish this task. Investors' rights are further strengthened by the prohibition for the depositaries (and their delegates) to reuse for their own 
account the assets held in custody. Fourth remuneration policies for all risk-takers involved in 
managing UCITS funds have been introduced so that remuneration practices do not encourage 
excessive risk-taking and instead promote sound and effective risk management. The transparency 
of the remuneration practices will be enhanced. The remuneration policies are in line with those in 
                                               
98 Regulation (EU) No 345/2013 of the European Parliament and of the Council of 17 April 2013 on 
European venture capital funds. Viewed at: http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32013R0345&from=EN. 
99 Regulation (EU) No 346/2013 of the European Parliament and of the Council of 17 April 2013 on 
European social entrepreneurship funds, viewed at : http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32013R0346&from=EN.  
100 Regulation 1286/2014 of the European Parliament and of the Council of 26 November 2014 on key 
information for Packaged Retail and Insuranc e-based Investment Products. Viewed at : 
http://www.fktk.lv/texts_files/3_Regulation_1286_2014_PRIIPs.pdf . 
101 Directive 2014/91/EU of the European Parliament and of the Council of 23 July 2014 amending 
Directive 2009/65/EC on the coordination of laws, regulations and administrative provisions relating to 
undertakings for collective investment in transferable securities (UCITS) as rega rds depositary functions, 
remuneration policies and sanctions. Vi ewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:32014L0091&from=EN . WT/TPR/S/317 • European Union 
 
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  the Alternative Investment Fund Managers Directive. Finally, the fifth Directive strengthens the 
existing regime to ensure effective and harmonised administrative sanctions. The use of criminal sanctions is framed so as to ensure the cooper ation between authorities and the transparency of 
sanctions. A harmonized system of strengthened cooperation will improve the effective detection 
of breaches of UCITS rules, including secure communication channels for the reporting of such 
breaches ("whistleblowing"). 
4.154.  The Commission has completed the second pillar package by six new proposals as yet 
unadopted. 
4.155.  The first unadopted proposal is a July 2012 revised insurance mediation directive proposal, 
so called IMD.
102 The goal of the proposal is to upgrad e consumer protection in the insurance 
sector by creating common standards across insurance sales and ensuring proper advice.  
4.156.  The second unadopted element of the second pillar is a February 2013 proposal for a 
strengthened regime on anti-money-laundering comp osed of one draft directive on the prevention 
of the use of the financial system for the pu rpose of money-laundering and terrorist-financing103 
and of a draft regulation on information accompanying transfers of funds.104 It is worth noting that 
the co-legislators reached political agreement on both the Directive and the Regulation on 
16 December 2014. According to the Commission both proposals fully take into account the latest 
Recommendations of the Financial Action Task Force (FATF), the world anti-money-laundering 
body, and go further in a number of fields. They provide for a more targeted and focused risk-based approach. 
4.157.  The third unadopted element of the second pillar is a June 2013 proposal of regulation on 
long-term investment funds.
105 Political agreement was reached by the co-legislators on this text 
at the end of December 2014. It will provide for a  new investment fund framework designed for 
investors who want to put money into companies and projects for the long-term.  
4.158.  The fourth unadopted elem ent of the second  pillar is two Ju ly 2013 legislative proposals for 
revised rules on innovative payments services, a draft regulation on interchange fees for card-based payment transactions
106 and a draft directive on payment services in the internal market.107 
The draft revised Payment Services Directive (PSD) facilitates and renders more secure the use of 
low cost internet payment services by including within its scope new so-called payment initiation services. These are services that operate be tween the merchant and the purchaser’s bank, 
allowing for cheap and efficient electronic payments without the use of a credit card. 
4.159.  The draft regulation on interchange fees, for its part, would introduce maximum levels of 
interchange fees for transactions based on consumer debit and credit cards and ban surcharges on these types of cards. Surcharges are the extra charge imposed by some merchants for the 
payment by card and are common notably for purchases of airline tickets. 
4.160.  The fifth unadopted element of the second pillar is a September 2013 proposal for a 
regulation of financial benchmarks such as LIBOR and EURIBOR.
108 This proposal is aimed at 
                                               
102 Proposal for a Directive of the European Parlia ment and of the Council on Insurance Mediation 
(recast), COM(2012)0360 final of 3 July 2012. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:52012PC0360&from=EN . 
103 COM (2013) 045 final of 5 February 2013. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:52013PC0045&from=EN . 
104 COM( 2013) 044 final of 5 February 2013. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:52013PC0044&from=EN . 
105 COM (2013) 0214 of 26 June 2013. Viewed at: http://eur-lex.europa.eu/legal-
content/FR/TXT/PDF/?uri=CELEX:52013PC0462&from=EN . 
106 Proposal for a Regulation of the European Parlia ment and of the Council on Interchange Fees for 
Card-Based Payment Transactions, COM (2013) 0550 final of 24 July 2013. Viewed at: http://eur-lex.europa.eu/legal-content/EN/T XT/PDF/?uri=CELEX:52013PC0550&from=EN . 
107 COM (2013) 0547 final of 24 July 2013, Proposal for a Directive of the European Parliament and of 
the Council on Payment Services in the Internal Ma rket and amending Directives 2002/65/EC, 2013/36/EU and 
2009/110/EC and repealing Directive 2007/64/EC. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/PDF/?uri=CELEX:52013PC0547&from=EN . 
108 COM (2013) 0641 final of 18 September 2013 Proposal for a Regulation of the European Parliament 
and of the Council on Indices Used as Benchmarks in Fi nancial Instruments and Financial Contracts. Viewed at: 
http://eur-lex.europa.eu/legal-content /EN/TXT/PDF/?uri=CELEX:52013PC0641&from=EN . WT/TPR/S/317 • European Union 
 
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  restoring confidence in the integrity of benchmarks. A benchmark is an index (statistical measure), 
calculated from a representative set of underlyin g data, that is used as a reference price for a 
financial instrument or financial contract or to measure the performance of an investment fund.  
4.161.  Finally the last unadopted element of the se cond pillar is constituted by two proosals made 
in March 2014. The first is aimed at the long-term financing of the European economy109 and is not 
yet formalized into a legislative proposal. The second is a draft Directive on revised rules for occupational pension funds.
110 
4.3.4.3  Legislations aimed at completing the Banking Union to strengthen the Euro 
4.162.  Finally, the third and last pillar of the post-financial crisis legislative agenda of the 
Commission is geared at completing the banking union to strengthen the euro. It is composed of two elements both of which have been adopted by  the Parliament and the Council and entered into 
force, namely the Single Supervision Mechanism (SSM) and the Single Resolution Mechanism 
(SRM). 
4.163.  The Single Supervision Mechanism is contained in two Regulations, Regulation EU 
1024/2013 of 15 October 2013 Conferring Specifics Tasks on the European Central Bank (ECB) 
concerning Policies Relating to the Prudential Supervision of Credit Institutions
111 and Regulation 
EU 1022/2013 of 22 October 2013 amending Re gulation 1093/2010 establishing a European 
Supervisory Authority (European Banking Authority-EBA).112 The SSM entered into force on 
4 November 2014. The establishment of the SS M together with a common bank resolution 
mechanism, underpinned by a single rulebook, is a first step towards a banking union. The SSM applies to all the euro area member States and is open to the participation of other member States 
who wish to embark on a path of deeper integration for supervision. Non-euro area member States 
may decide to join the SSM by establishing a close cooperation between their competent authorities and the ECB. In that case they may,  on an equal footing with the euro-area member 
States, participate in the activities of the newly-created Supervisory Board which is in charge of 
planning and executing the supervisory tasks conferred upon the ECB. 
4.164.  The Regulation confers key supervisory ta sks and powers to the ECB over all the credit 
institutions established within the euro area. The ECB carries out its tasks within an SSM 
composed of the ECB and competent national authorities. Within the SSM, the ECB will be responsible for the supervision of all 6000 banks of  the euro area. In particular the ECB shall 
ensure the coherent and consistent application of  the Single rulebook in the euro area. The ECB 
will directly supervise banks having assets of more  than €30 billion or constituting at least 20% of 
their home country's GDP or which have requested or received direct public financial assistance from the EFSF (European Financial Stability Facility) or the ESM. The ECB will monitor the 
supervision by national supervisors of less significant banks. The ECB may at any moment decide 
to directly supervise one or more of these credit institutions to ensure consistent application of high supervisory standards. The work of nation al supervisors is integrated into the SSM: for 
instance, the ECB will send instructions to national supervisors, and national supervisors have a 
duty to notify the ECB of supervisory decisions of  material consequence. The governance structure 
of the ECB will consist of a separate Supervis ory Board supported by a steering committee, the 
ECB Governing Council, and a mediation panel to  solve disagreements that may arise between 
competent national authorities and the Governing Council. Clear separation between the ECB’s 
monetary tasks and supervisory tasks is fully ensured. For cross-border banks active both within and outside member States participating in the SSM, existing home/host supervisor coordination 
procedures will continue to exist as they do to day. To the extent that the ECB has taken over 
                                               
109 COM (2014) 0168 of 27 March 2014, Communication from the Commission to the European 
Parliament and the Council on Long-Term Financing of the European Economy. Viewed at: http://eur-
lex.europa.eu/legal-content/EN/T XT/PDF/?uri=CELEX:52014DC0168&from=EN . 
110 COM (2014) 0167 final of 27 March 2014, proposal for a Directive of the European Parliament and of 
the Council on the Activities and Supervision of Inst itutions for Occupational Retirement Provision-IORP- 
(recast). Viewed at: http://eur-lex.europa.eu/resource.html?uri=cellar:33cb1b95-b6c8-11e3-86f9-
01aa75ed71a1.0002.01/DOC_1&format=PDF . 
111 OJ L 287 of 29 October 2013, for the full text of the regulation see: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:287:0063:0089:EN:PDF . 
112 OJ L 287 of 29 October 2013, for the full text of the regulation see: http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:287:0005:0014:EN:PDF . WT/TPR/S/317 • European Union 
 
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  direct supervisory tasks, it will carry out the functions of the home and host authority for all 
participating member States. 
4.165.  The rules on the functioning of the EBA ha ve been adapted and its role reinforced. The EBA 
will continue developing the single rulebook applicable to all member States. In order to foster 
consistency and efficiency of supervisory practices across the whole Union, it will develop a single 
supervisory handbook. It will also ensure that regular stress-tests are carried out to assess the resilience of European banks. There will be sa feguards for non-euro-zone member States by 
means of double majority voting requirements for EBA decisions on mediation and on technical 
standards. This ensures that decisions are backed by both a majority of the participating and the 
non-participating member States. The second element of the third pillar is the Single Resolution Mechanism (SRM) which is contained in Regulation (EU) 806/2014 of 15 July 2014.
113 The Single 
Resolution Mechanism will complement the SSM and will ensure that – notwithstanding stronger 
supervision – if a bank subject to the SSM faces se rious difficulties, its resolution can be managed 
efficiently with minimal costs to taxpayers and the real economy. The SRM will apply to all banks 
in the euro area and other member States that opt to participate. 
4.166.  The division of powers of the Single Reso lution Board and national resolution authorities 
broadly follows the division of supervisory powers  between the ECB and national supervisors in the 
context of the SSM. The decision to resolve a failing bank will in most cases start with the ECB 
notifying that a bank is failing to the Board, the Commission, and the relevant national resolution authorities. The Board will then adopt a resolution scheme including the relevant resolution tools and any use of the Fund. Before the Board adopts its decision, the Commission will assess its 
compliance with State-aid rules. The Commission will then assess the Board's decision against the 
resolution objectives and either endorse or ob ject to the resolution scheme. Only when the 
Commission significantly modifies the amount of resources drawn from the Single Fund or contests 
the public interest in resolving the bank and considers it could be put into normal insolvency 
instead, will this be subject to approval or ob jection by the Council (silence procedure). Where the 
Council or the Commission object to the resolution scheme, the Board will have to amend the 
resolution scheme. The resolution scheme will th en be implemented by the national resolution 
authorities, in accordance with national law, including relevant provisions transposing the Bank Recovery and Resolution Directive. 
4.167.  The Single Resolution Fund will be constituted from contributions from all banks in the 
participating member States. It will be administrated by the Board. The Fund has a target level of 
€55 billion and can borrow from the markets if decided by the Board. It will reach the target level over eight years. During the transition, the Fund will comprise national compartments, the 
resources accumulated in which will be progressively mutualized, starting with 40% of these 
resources in the first year. The Fund and the decision-making on its use is regulated by the SRM Regulation, while the transfer of contributions raised nationally towards the Single Fund and the 
mutualization of the national compartments is set out in an inter-governmental agreement 
established among the participating member States. 
4.168.  Finally negotiations on a financial transaction tax are still ongoing within the specific legal 
framework of "enhanced cooperation" among 11 member States and the Commission.
114 
                                               
113 Regulation (EU) No. 806/2014 of the European Parliament and of the Council of 15 July 2014 
Establishing Uniform Rules and a Uniform Procedure for the Resolution of Credit Institutions and Certain 
Investment Firms in the Framework of a Single Resolution Mechanism and a Single Resolution Fund and 
amending Regulation (EU) No. 1093/2010. Viewed at: http://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:32014R0806&from=EN . 
114 WT/TPR/S/284/Rev.2, para. 4.103 and Table 4.23, 28 November 2013. WT/TPR/S/317 • European Union 
 
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  5  APPENDIX TABLES 
Table A1.1 GDP growth rates of EU member States, 2012-14 
(%) 
 2012
Q1 2012
Q22012
Q3 2012
Q42013
Q12013
Q22013
Q32013
Q42014
Q12014
Q2 2014
Q3 2014
Q4
EU28 0.3 -0.7 -0.6 -0.9 -1.3 0.0 0.5 0.9 1.4 1.2 1.3 1.2
BEL 0.4 0.1 -0.1 0.0 -0.4 0.3 0.6 0.6 1.2 1.0 1.0 1.0 
BGR 0.9 0.3 0.9 -0.1 0.2 -0.4 1.2 3.0 1.1 2.1 1.9 1.6 
CZE 0.5 -1.1 -1.4 -1.1 -2.7 -1.4 0.3 0.8 2.3 2.1 2.5 1.2 
DNK 0.2 -1.3 -0.2 -1.3 -1.5 -0.6 -0.2 0.3 1.2 0.4 1.1 1.3 
DEU 1.5 0.3 0.1 -0.3 -1.8 0.5 0.8 1.0 2.6 1.0 1.2 1.6 
EST 5.8 5.2 4.0 3.8 3.9 0.8 0.3 1.7 0.5 2.3 2.4 3.0 
IRL 0.9 -2.6 -0.7 1.1 0.3 -0.2 1.8 -1.2 4.0 7.3 3.5 .. 
GRC -7.8 -7.7 -6.3 -4.4 -5.8 -4.2 -2.6 -3.1 -0.5 0.3 2.0 1.2 
ESP -1.7 -1.9 -2.2 -2.5 -2.9 -1.5 -0.5 -0.1 0.7 1.1 1.7 2.1 
FRA 0.9 0.0 0.3 0.1 -0.8 0.5 0.7 0.6 0.7 0.1 0.3 0.4 
HRV -1.3 -2.9 -2.0 -2.5 -1.8 -0.5 -0.5 -1.1 -0.6 -0.8 -0.5 0.3 
ITA -2.1 -3.4 -3.0 -2.5 -2.8 -2.1 -0.9 -0.9 -0.1 -0.5 -0.4 -0.6 
CYP -1.3 -2.4 -2.2 -3.6 -5.4 -6.0 -5.0 -4.9 -3.4 -1.7 -2.1 -2.0 
LVA 8.8 4.3 3.7 3.4 3.1 4.6 4.6 4.5 2.8 2.3 2.4 2.1 
LTU 3.9 2.0 5.1 4.3 3.1 3.7 3.0 3.3 3.3 3.4 2.7 2.4 
LUX -2.0 0.7 -0.4 0.9 2.0 2.4 2.7 1.0 2.5 1.3 4.0 .. 
HUN -0.4 -1.4 -1.5 -2.5 -0.7 1.2 2.2 3.2 3.8 4.1 3.3 3.4 
MLT 0.5 3.9 2.2 3.3 2.4 3.9 2.1 2.5 3.2 3.3 3.7 4.0 
NLD -1.5 -1.2 -1.9 -1.7 -1.8 -1.4 -0.6 1.0 0.0 1.1 1.0 1.0 
AUT 1.3 0.2 0.5 1.6 -0.5 0.0 0.4 0.9 0.5 0.6 0.4 -0.2 
POL 3.9 2.2 1.7 -0.3 0.3 1.1 2.6 2.4 3.7 3.3 3.4 2.9 
PRT -2.7 -3.5 -3.5 -3.5 -3.8 -1.4 -1.1 0.9 0.7 1.0 1.5 0.4 
ROU 0.2 2.1 -0.5 0.8 2.1 1.4 4.2 5.2 4.1 1.6 3.3 2.6 
SVN -0.4 -3.5 -3.1 -3.4 -4.5 -1.3 -0.3 2.1 2.1 2.9 3.2 2.4 
SVK 2.5 2.1 1.7 0.3 0.9 1.3 1.5 2.0 2.3 2.6 2.4 2.4 
FIN 0.6 -1.2 -1.8 -3.1 -3.6 -1.2 -0.4 -0.1 0.1 -0.4 0.0 -0.1 
SWE 0.4 -0.2 -1.1 -0.3 0.4 0.8 1.4 2.5 1.7 1.9 2.3 2.7 
GBR 1.6 0.6 0.9 -0.4 0.3 2.2 1.5 2.6 2.1 3.5 2.5 2.0 
.. Not available. 
 Note: Year-on-year rate. Including provisional figures. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . WT/TPR/S/317 • European Union 
 
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  Table A1.2 GDP growth and components contributions, 2008-14 
(%age point) 
 2008 2009 2010 2011 2012 2013 2014
EU28 GDP 0.5 -4.4 2.1 1.7 -0.5 0 1.3
Private consumption 0.2 -0.8 0.5 0.2 -0.4 -0.1 0.8
Public consumption 0.5 0.4 0.2 0.0 0.0 0.0 0.2
Investment -0.1 -2.7 0.0 0.4 -0.5 -0.3 0.4
Net exports 0.2 -0.1 0.4 0.9 1.1 0.4 -0.1
Belgium 
 GDP 1.0 -2.6 2.5 1.6 0.1 0.3 1.0 
Private consumption 0.9 0.1 1.4 0.3 0.4 0.2 0.5 
Public consumption 0.6 0.3 0.3 0.2 0.3 0.3 0.2 
Investment 0.7 -1.8 0.0 0.9 0.0 -0.5 0.8 
Net exports -1.3 -0.3 0.5 -0.3 0.1 0.8 0.5 
Bulgaria 
 GDP 5.8 -5.0 0.7 2.0 0.5 1.1 1.7 
Private consumption 2.5 -4.2 0.3 1.1 2.4 -1.5 0.9 
Public consumption -0.2 -1.3 0.3 0.3 -0.2 0.4 0.3 
Investment 6.3 -5.8 -5.3 -1.1 0.4 0.0 0.5 
Net exports -2.2 9.6 5.4 1.4 -2.3 2.6 -0.6 
Czech Republic GDP 2.7 -4.8 2.3 2.0 -0.8 -0.7 2.0 
Private consumption 1.3 -0.3 0.5 0.1 -0.9 0.2 0.7 
Public consumption 0.2 0.6 0.1 -0.6 -0.2 0.4 0.3 
Investment 0.8 -2.9 0.4 0.3 -0.8 -1.1 0.8 
Net exports 0.8 0.5 0.5 1.9 1.3 0.0 -0.1 
Denmark GDP -0.7 -5.1 1.6 1.2 -0.7 -0.5 1.0 
Private consumption 0.2 -1.6 0.4 0.1 0.2 0.0 0.2 
Public consumption 0.8 0.8 0.4 -0.4 0.0 -0.1 0.3 
Investment -0.8 -3.3 -0.8 0.1 0.1 0.2 0.4 
Net exports -0.4 1.2 0.5 0.5 -0.4 -0.3 -0.2 
Germany GDP 1.1 -5.6 4.1 3.6 0.4 0.1 1.6 
Private consumption 0.3 0.0 0.3 1.3 0.4 0.5 0.6 
Public consumption 0.6 0.5 0.3 0.1 0.2 0.1 0.2 
Investment 0.2 -2.0 1.0 1.4 -0.1 -0.1 0.6 
Net exports 0.0 -2.6 1.3 0.7 1.3 -0.5 0.4 
Estonia GDP -5.3 -14.7 2.5 8.3 4.7 1.6 2.1 
Private consumption -2.6 -8.3 -0.9 1.3 2.6 1.9 2.3 
Public consumption 0.7 -0.6 -0.1 0.3 0.6 0.5 0.3 
Investment -4.8 -11.4 -0.6 7.0 2.7 0.7 -0.3 
Net exports 5.0 8.1 2.8 0.5 -4.2 -0.7 -0.1 
Ireland GDP -2.6 -6.4 -0.3 2.8 -0.3 0.2 .. 
Private consumption -0.1 -2.8 0.2 -0.5 -0.7 -0.2 0.2 
Public consumption 0.2 -0.5 -1.0 -0.4 -0.2 0.0 0.3 
Investment -2.5 -4.6 -3.5 -0.4 0.8 -0.4 1.3 
Net exports 1.1 3.4 3.2 5.7 -0.8 0.6 3.0 
Greece GDP -0.4 -4.4 -5.4 -8.9 -6.6 -3.9 0.8 
Private consumption 2.0 -0.7 -4.9 -7.4 -5.5 -1.4 1.0 
Public consumption -0.4 0.3 -1.0 -1.4 -1.1 -1.4 -0.2 
Investment -1.7 -3.1 -4.4 -2.9 -4.4 -1.1 0.1 
Net exports -0.1 2.8 2.5 2.8 3.2 1.1 0.8 
Spain GDP 1.1 -3.6 0.0 -0.6 -2.1 -1.2 1.4 
Private consumption -0.4 -2.1 0.1 -1.2 -1.7 -1.3 1.3 
Public consumption 1.0 0.8 0.3 -0.1 -0.8 -0.6 0.1 
Investment -1.2 -4.9 -1.2 -1.5 -1.7 -0.7 0.6 
Net exports 1.6 2.8 0.5 2.1 2.2 1.4 -0.8 WT/TPR/S/317 • European Union 
 
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   2008 2009 2010 2011 2012 2013 2014
France 
 GDP 0.2 -2.9 2.0 2.1 0.3 0.3 0.4 
Private consumption 0.2 0.1 1.0 0.3 -0.2 0.1 0.3 
Public consumption 0.3 0.5 0.3 0.2 0.4 0.5 0.4 
Investment 0.2 -2.1 0.5 0.5 0.1 -0.2 -0.3 
Net exports -0.3 -0.3 -0.1 0.0 0.7 0.1 -0.3 
Croatia  GDP 2.1 -7.4 -1.7 -0.3 -2.2 -0.9 -0.4 
Private consumption 0.8 -4.3 -0.9 0.2 -1.8 -0.7 -0.4 
Public consumption -0.1 0.4 -0.3 -0.1 -0.2 0.1 -0.4 
Investment 2.5 -4.0 -3.8 -0.6 -0.7 -0.2 -0.7 
Net exports -1.5 4.1 3.1 -0.1 1.2 0.0 1.0 
Italy GDP -1.0 -5.5 1.7 0.6 -2.8 -1.7 -0.4 
Private consumption -0.6 -0.9 0.8 0.0 -2.5 -1.7 0.2 
Public consumption 0.2 0.1 0.1 -0.4 -0.3 -0.1 -0.1 
Investment -0.7 -2.1 -0.1 -0.4 -1.5 -1.0 -0.5 
Net exports 0.2 -1.3 -0.2 1.2 2.8 0.9 0.3 
Cyprus GDP 3.6 -2.0 1.4 0.3 -2.4 -5.4 -2.3 
Private consumption 5.1 -4.4 0.8 1.2 -0.5 -4.1 -0.8 
Public consumption 0.9 1.1 -0.3 0.1 -0.5 -0.9 -0.8 
Investment 2.3 -3.8 -1.2 -2.1 -3.9 -2.6 -1.5 
Net exports -5.5 6.1 -1.1 2.3 1.6 4.5 0.4 
Latvia GDP -3.2 -14.2 -2.9 5.0 4.8 4.2 2.4 
Private consumption -4.9 -9.6 1.9 1.9 1.9 3.8 2.0 
Public consumption 0.4 -2.1 -1.5 0.6 0.1 0.5 0.2 
Investment -3.4 -10.6 -4.5 4.6 3.2 -1.3 0.3 
Net exports 7.1 11.5 0.2 -5.6 2.3 0.7 0.2 
Lithuania GDP 2.6 -14.8 1.6 6.1 3.8 3.3 2.9 
Private consumption 2.4 -11.3 -2.3 2.9 2.2 2.6 3.1 
Public consumption 0.0 -0.3 -0.7 0.1 0.2 0.3 0.4 
Investment -1.2 -10.1 0.2 3.3 -0.3 1.2 1.3 
Net exports -1.0 11.9 -0.2 0.2 4.0 0.4 -1.2 
Luxembourg  GDP 0.5 -5.3 5.1 2.6 -0.2 2.0 .. 
Private consumption 0.0 0.3 0.7 0.4 0.6 0.5 0.8 
Public consumption 0.4 0.6 0.5 0.2 0.6 0.8 0.6 
Investment 1.8 -2.4 0.0 2.4 0.4 -0.8 0.4 
Net exports -0.5 -2.0 0.8 -1.1 -0.3 1.5 1.2 
Hungary  GDP 0.9 -6.6 0.8 1.8 -1.5 1.5 3.6 
Private consumption -0.6 -3.6 -1.5 0.4 -1.0 0.0 0.9 
Public consumption 0.7 0.3 -0.1 0.0 -0.3 0.7 0.3 
Investment 0.3 -1.9 -2.2 -0.4 -0.8 1.0 2.7 
Net exports 0.7 2.6 1.3 2.0 1.4 0.4 -0.8 
Malta  GDP 3.3 -2.5 3.5 2.3 2.5 2.7 3.5 
Private consumption -0.1 1.1 -0.1 1.4 0.3 0.9 1.3 
Public consumption 2.2 -0.7 0.3 0.6 1.2 0.1 1.2 
Investment -2.0 -2.3 4.8 -3.8 -0.1 0.4 1.7 
Net exports 0.0 -1.1 -1.2 4.4 4.5 -0.4 -0.9 
Netherlands  GDP 2.1 -3.3 1.1 1.7 -1.6 -0.7 0.8 
Private consumption 0.5 -0.8 0.0 0.1 -0.6 -0.7 0.0 
Public consumption 1.0 1.0 0.3 -0.1 -0.4 -0.1 0.0 
Investment 1.0 -2.0 -1.2 1.1 -1.2 -0.8 0.3 
Net exports -0.1 -1.0 1.0 0.9 0.6 1.1 0.4 
Austria  GDP 1.5 -3.8 1.9 3.1 0.9 0.2 0.3 
Private consumption 0.4 0.3 0.8 0.4 0.3 -0.1 0.2 
Public consumption 0.7 0.5 0.1 0.0 0.1 0.1 0.2 
Investment 0.3 -1.7 -0.5 1.5 0.1 -0.3 0.2 
Net exports 0.7 -2.1 1.0 0.3 0.3 0.9 -0.5 WT/TPR/S/317 • European Union 
 
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   2008 2009 2010 2011 2012 2013 2014
Poland GDP 3.9 2.6 3.7 4.8 1.8 1.7 3.3 
Private consumption 3.7 2.1 1.7 1.8 0.5 0.6 1.8 
Public consumption 0.9 0.7 0.6 -0.4 0.0 0.4 0.4 
Investment 1.8 -0.4 -0.1 1.8 -0.3 0.2 1.7 
Net exports -1.2 2.9 -0.5 0.9 2.1 1.4 -0.8 
Portugal GDP 0.2 -3.0 1.9 -1.8 -3.3 -1.4 0.9 
Private consumption 0.9 -1.5 1.6 -2.4 -3.4 -0.9 1.4 
Public consumption 0.1 0.5 -0.3 -0.8 -0.8 -0.4 -0.1 
Investment 0.1 -1.7 -0.2 -2.6 -2.8 -1.0 0.4 
Net exports -1.1 0.9 -0.1 4.3 3.6 1.0 -0.8 
Romania GDP 8.5 -7.1 -0.8 1.1 0.6 3.4 2.9 
Private consumption 4.8 -6.4 0.6 0.5 0.8 0.7 3.1 
Public consumption 1.1 0.6 -0.9 0.1 0.1 -0.7 0.4 
Investment 6.3 -14.1 -0.6 0.8 0.0 -2.2 -1.3 
Net exports -1.0 6.9 -0.1 -0.1 1.1 4.3 0.6 
Slovenia  GDP 3.3 -7.8 1.2 0.6 -2.6 -1.0 2.6 
Private consumption 1.2 0.5 0.5 -0.1 -1.7 -2.2 0.3 
Public consumption 0.9 0.4 0.0 -0.3 -0.3 -0.2 -0.4 
Investment 2.0 -6.5 -3.3 -1.0 -1.8 0.4 1.1 
Net exports 0.2 1.9 2.1 1.4 2.9 1.0 1.5 
Slovakia GDP 5.4 -5.3 4.8 2.7 1.6 1.4 2.4 
Private consumption 3.3 -0.3 0.1 -0.4 -0.3 -0.4 1.2 
Public consumption 0.9 1.2 0.3 -0.4 -0.4 0.4 0.8 
Investment 0.4 -4.8 1.6 2.8 -2.2 -0.6 0.8 
Net exports -0.5 2.2 0.4 1.7 5.8 1.4 -0.2 
Finland GDP 0.7 -8.3 3.0 2.6 -1.4 -1.3 -0.1 
Private consumption 1.0 -1.3 1.6 1.6 0.1 -0.4 0.1 
Public consumption 0.3 0.3 0.0 0.0 0.2 0.4 0.0 
Investment 0.1 -3.1 0.2 0.9 -0.6 -1.1 -0.9 
Net exports -0.2 -2.1 0.0 -1.5 -0.1 0.3 0.7 
Sweden GDP -0.6 -5.2 6.0 2.7 -0.3 1.3 .. 
Private consumption 0.1 0.2 1.8 0.9 0.4 0.9 1.1 
Public consumption 0.3 0.6 0.3 0.2 0.3 0.2 0.4 
Investment 0.1 -3.3 1.3 1.3 -0.1 -0.1 1.0 
Net exports -0.6 -1.1 0.4 -0.2 0.3 0.2 -0.9 
United Kingdom GDP -0.3 -4.3 1.9 1.6 0.7 1.7 2.6 
Private consumption -0.3 -2.0 0.2 0.1 0.7 1.1 1.5 
Public consumption 0.4 0.2 0.0 0.0 0.5 -0.1 0.3 
Investment -0.9 -2.6 1.0 0.4 0.1 0.5 1.2 
Net exports 0.9 0.7 -0.8 1.3 -0.8 0.0 -0.6 
.. Not available. 
 Note: Including provisional and estimated figures.  Source: Eurostat database, and DG ECFIN an nual macroeconomic database (AMECO).  WT/TPR/S/317 • European Union 
 
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  Table A1.3 Import volume (index), 2007-13a 
 2007 2008 2009 2010 2011 2012 2013
Belgium 108.4 106.8 93.6 100.0 104.9 103.7 104.0 
Bulgaria 99.5 126.8 96.8 100.0 109.7 116.1 121.6 
Czech Republic 96.9 101.5 84.4 100.0 107.2 103.8 102.9 
Denmark 119.9 120.0 99.8 100.0 103.2 103.5 105.2 
Germany  100.7 100.8 88.5 100.0 104.8 101.1 101.6 
Estonia 129.1 114.0 85.3 100.0 123.0 130.0 130.0 
Ireland 135.2 124.4 103.7 100.0 98.1 95.9 96.8 
Greece 127.9 127.2 112.3 100.0 87.5 84.7 83.2 
Spain 121.4 114.8 92.6 100.0 99.9 92.5 91.7 
France 107.8 107.4 93.9 100.0 103.0 100.2 98.1 
Croatia 130.0 132.4 105.3 100.0 98.4 95.6 96.7 
Italy 111.2 105.4 88.5 100.0 99.4 90.9 87.6 
Cyprus 99.9 109.6 93.3 100.0 90.4 79.3 67.9 
Latvia 131.9 119.2 84.8 100.0 123.4 133.5 134.6 
Lithuania 111.5 117.1 85.3 100.0 113.5 117.5 125.4 
Luxembourg 108.9 115.5 105.7 100.0 102.5 101.8 99.1 
Hungary 106.2 110.0 87.7 100.0 106.6 105.4 109.4 
Malta 91.9 92.1 86.5 100.0 110.8 121.8 109.6 
Netherlands 99.6 103.0 90.6 100.0 102.1 104.2 103.2 
Austria 104.9 104.3 89.4 100.0 106.5 104.6 103.5 
Poland 95.0 104.3 87.2 100.0 105.0 103.7 104.6 
Portugal 103.2 105.8 92.9 100.0 94.6 87.8 91.2 
Romania 115.2 121.1 89.0 100.0 108.0 104.8 106.7 
Slovenia 106.7 111.5 90.9 100.0 105.0 100.9 104.3 
Slovakia 93.6 100.8 86.2 100.0 110.6 114.0 117.3 
Finland 119.3 120.5 92.8 100.0 105.7 100.7 101.4 
Sweden 105.2 103.8 84.4 100.0 105.0 101.9 97.8 
United Kingdom 113.0 106.0 92.5 100.0 100.4 103.7 97.8 
a Including intra-EU imports. 
Note: Base year 2010. 
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database .  WT/TPR/S/317 • European Union 
 
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  Table A1.4 Export volume (index), 2007-13a 
 2007 2008 2009 2010 2011 2012 2013
Belgium 105.7 103.6 92.0 100.0 104.0 103.3 106.0 
Bulgaria 89.5 96.5 83.0 100.0 120.4 120.0 134.0 
Czech Republic 94.6 100.5 84.4 100.0 109.8 111.6 112.0 
Denmark 108.6 109.8 97.6 100.0 104.0 102.1 102.9 
Germany 106.0 105.7 86.9 100.0 106.4 106.5 106.1 
Estonia 95.8 96.7 80.0 100.0 126.7 129.6 129.0 
Ireland 100.6 96.9 96.9 100.0 101.4 99.0 95.0 
Greece 95.9 98.8 92.5 100.0 104.1 115.0 118.5 
Spain 100.2 100.4 89.4 100.0 108.7 109.5 113.4 
France 107.9 106.6 91.0 100.0 102.9 102.6 101.5 
Croatia 100.9 101.7 87.0 100.0 101.0 98.7 95.9 
Italy 115.2 111.2 90.3 100.0 104.6 104.8 104.0 
Cyprus 94.2 94.0 91.8 100.0 116.1 118.9 139.3 
Latvia 85.5 93.4 83.3 100.0 122.4 138.4 136.8 
Lithuania 83.5 98.5 84.2 100.0 113.6 123.6 133.8 
Luxembourg 106.4 114.0 109.0 100.0 96.2 101.6 89.5 
Hungary 102.5 106.3 88.4 100.0 107.2 105.5 106.3 
Malta 111.1 99.4 81.6 100.0 104.6 119.8 95.8 
Netherlands 97.6 100.3 89.4 100.0 101.0 104.8 105.7 
Austria 106.2 106.3 86.9 100.0 106.0 106.2 107.8 
Poland 89.0 96.0 86.9 100.0 107.2 111.9 118.5 
Portugal 106.1 105.2 89.3 100.0 108.0 111.4 116.5 
Romania 84.2 90.9 83.8 100.0 110.5 107.6 120.9 
Slovenia 102.5 105.1 88.9 100.0 107.5 105.9 109.8 
Slovakia 86.3 96.3 83.6 100.0 112.2 122.7 127.2 
Finland 126.1 126.8 93.6 100.0 101.4 100.9 100.8 
Sweden 107.8 107.0 85.9 100.0 106.6 103.4 98.2 
United Kingdom 109.6 106.2 89.7 100.0 108.4 102.9 115.6 
a Including intra-EU exports. 
Note: Base year 2010. Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database .  WT/TPR/S/317 • European Union 
 
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  Table A1.5 Intra-EU merchandise trade by product groups, 2010-13 
(€ billion) 
  Export Import 
2010 2011 2012 2013 2010 2011 2012 2013
Food, drinks 
and tobacco 247.7 269.7 282.7 296.3 244.2 265.5 279.4 290.5 
Raw materials 93.4 109.0 107.3 103.7 96.8 114.6 109.7 107.2 
Mineral fuels, 
lubricants and related materials 174.7 226.4 260.4 250.2 177,0 232.5 263.0 256.0 
Chemicals 
and related 
products, 
n.e.s. 414.0 448.0 459.3 459.9 416.9 450.5 458.9 460.0 
Other 
manufactured goods 693.2 771.9 748.5 745.2 652.0 726.1 706.7 699.7 
Machinery 
and transport 
equipment 891.2 960.9 945.2 947.8 869.3 937.2 920.1 924.0 
Commodities 
and 
transactions nes in the SITC 42.9 36.5 38.1 35.4 28.6 27.9 32.1 24.6 
Total  2,557.1 2,822.4 2,841.5 2,838.5 2,484.8 2,754.3 2,770.1 2,762.0
Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . 
 WT/TPR/S/317 • European Union 
 
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  Table A1.6 Merchandise expo rts by destination,  2010-13 
(€ billion) 
 2010 2011 2012 2013
Total 1,353 1,554 1,684 1,738
 (%) 
  America 26.8 25.7 26.4 25.4
    United States 17.9 17.0 17.4 16.6 
    Other America 8.9 8.7 9.0 8.8 
      Brazil 2.3 2.3 2.4 2.3 
      Canada 2.0 1.9 1.9 1.8 
      Mexico 1.6 1.5 1.7 1.6 
  Europe 17.9 19.1 17.5 19.3
    EFTA 11.5 12.3 11.1 12.8 
      Switzerland 8.2 9.2 8.0 9.8 
      Norway 3.1 3.0 3.0 2.9 
    Other Europe 6.5 6.7 6.5 6.5 
      Turkey 4.6 4.7 4.5 4.5 
  Commonwealth of Independen t States (CIS) 9.1 9.8 10.3 9.9
      Russian Federation 6.4 7.0 7.3 6.9 
      Ukraine 1.3 1.4 1.4 1.4 
  Africa 9.4 8.8 8.9 8.8
      South Africa 1.6 1.7 1.5 1.4 
      Algeria 1.2 1.1 1.3 1.3 
      Morocco 1.0 1.0 1.0 1.0 
  Middle East 7.9 7.5 7.4 7.8
      United Arab Emirates 2.1 2.1 2.2 2.6 
      Saudi Arabia, Kingdom of 1.7 1.7 1.8 1.9 
      Israel 1.1 1.1 1.0 1.0 
  Asia 26.9 27.1 27.1 26.5
    China 8.4 8.8 8.6 8.5 
    Japan 3.3 3.2 3.3 3.1 
    Six East Asian Traders 8.6 8.4 8.7 8.7 
      Korea, Republic of 2.1 2.1 2.2 2.3 
      Hong Kong, China 2.0 2.0 2.0 2.1 
      Singapore 1.8 1.8 1.8 1.7 
    Other Asia 6.7 6.7 6.5 6.1 
      India 2.6 2.6 2.3 2.1 
      Australia 2.0 2.0 2.0 1.8 
  Other 1.9 2.0 2.3 2.3 
Source: Eurostat. Viewed at: 
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database . WT/TPR/S/317 • European Union 
 
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  Table A1.7 Merchandise export s by product group, 2010-13 
(€ billion) 
 2010 2011 2012 2013
Total  1,353 1,554 1,684 1,738
 (%) 
Primary products 15.7 16.7 17.6 17.0 
     Agriculture products 7.2 7.3 7.5 7.7 
          Food 5.9 6.0 6.2 6.3 
          Raw materials 1.3 1.3 1.4 1.3 
     Fuels and mining products 8.5 9.4 10.1 9.3 
          Fuels 5.8 6.4 7.5 7.0 
          Non-ferrous metals 1.5 1.7 1.5 1.4 
          Ores and other minerals 1.2 1.3 1.2 0.9 
Manufactures 80.6 79.0 79.2 77.0 
     Iron and steel 2.5 2.6 2.5 2.2 
     Chemicals 17.2 16.4 16.4 15.7 
          Pharmaceuticals 6.9 6.7 6.7 6.5 
          Plastics  2.4 2.3 2.2 2.2 
          Other chemicals 7.9 7.5 7.5 7.0 
     Other semi-manufactures 7.4 7.1 7.0 7.0 
     Machinery and transport equipment 41.9 41.5 41.8 40.7 
          Office and telecommunication equipment 5.6 5.1 4.7 4.3 
               Electronic data processing and office equipment 1.8 1.6 1.6 1.4 
               Integrated circui ts and electronic components 1.1 1.0 0.9 0.9 
               Telecommunication equipment 2.7 2.6 2.3 2.0 
          Transport equipment 15.5 15.7 16.4 16.4 
               Automotive products 9.9 10.4 11.0 10.9 
               Other transport equipment 5.6 5.2 5.4 5.4 
          Other machinery 20.9 20.7 20.6 20.0 
               Electrical machinery 4.8 4.6 4.5 4.5 
               Non electrical machinery 12.9 13.2 12.9 12.5 
               Power ge nerating machinery 3.2 3.0 3.1 3.0 
     Textiles 1.1 1.1 1.0 1.0 
     Clothing 1.2 1.3 1.3 1.3 
     Other manufactures 9.1 8.8 9.2 9.1 
Other products 3.8 4.4 3.2 6.0 
Source: Eurostat. Viewed at: 
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database . WT/TPR/S/317 • European Union 
 
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  Table A1.8 Merchandise imports by origins, 2010-13 
(€ billion) 
 2010 2011 2012 2013
Total 1,529.4 1,725. 0 1,796.3 1,682.4
 (%) 
  America 19.3 19.5 19.5 19.4
    United States 11.4 11.1 11.5 11.7 
    Other America 7.9 8.4 8.0 7.7 
      Brazil 2.2 2.3 2.1 2.0 
      Canada 1.6 1.8 1.7 1.6 
      Mexico 0.9 1.0 1.1 1.0 
  Europe 14.5 14.6 15.2 15.1
    EFTA 11.0 11.1 11.7 11.2 
      Switzerland 5.7 5.5 6.0 5.7 
      Norway 5.2 5.4 5.6 5.4 
    Other Europe 3.5 3.6 3.4 3.9 
      Turkey 2.8 2.8 2.7 3.0 
  Commonwealth of Independen t States (CIS) 13.4 15.2 15.4 15.7
      Russian Federation 10.6 11.7 12.0 12.2 
      Kazakhsta n 1.0 1.3 1.4 1.4 
  Africa 9.0 8.8 10.4 10.0
      Algeria 1.4 1.6 1.8 1.9 
      Nigeria 0.9 1.4 1.8 1.7 
      Libyan Arab Jamahiriya 1.9 0.6 1.8 1.4 
  Middle East 4.7 5.9 5.2 4.9
      Saudi Arabia, Kingdom of 1.1 1.6 1.9 1.8 
  Asia 37.9 35.2 33.5 34.0
    China 18.6 17.1 16.3 16.6 
    Japan 4.4 4.1 3.6 3.4 
    Six East Asian Traders 8.7 7.4 7.2 7.2 
      Korea, Republic of 2.6 2.1 2.1 2.1 
      Chinese Taipei 1.6 1.4 1.3 1.3 
      Malaysia 1.2 1.1 1.0 1.1 
      Singapore 1.2 1.1 1.2 1.0 
      Thailand 1.1 1.0 0.9 1.0 
    Other Asia 6.2 6.6 6.4 6.7 
      India 2.2 2.3 2.1 2.2 
      Viet Nam 0.6 0.8 1.0 1.3 
  Other 1.3 0.7 0.8 1.0 
Source: Eurostat. Viewed at: 
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database . WT/TPR/S/317 • European Union 
 
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  Table A1.9 Merchandise imports by product groups, 2010-13 
 2010 2011 2012 2013
Total (€ billion) 1,529 1,725 1,796 1,682
 (%) 
Primary products 37.5 41.3 42.2 41.8 
     Agriculture products 7.6 7.8 7.5 8.0 
          Food 6.1 6.2 6.2 6.6 
          Raw materials 1.5 1.5 1.3 1.4 
     Fuels and mining products 29.9 33.6 34.7 33.8 
          Fuels 25.2 28.6 30.5 29.6 
          Non-ferrous metals 2.4 2.5 2.0 2.1 
          Ores and other minerals 2.3 2.5 2.1 2.1 
Manufactures 59.2 55.3 53.7 55.7 
     Iron and steel 1.7 2.0 1.5 1.5 
     Chemicals 9.0 9.0 9.1 9.4 
          Pharmaceuticals 3.1 3.1 3.3 3.4 
          Plastics  1.1 1.1 1.1 1.2 
          Other chemicals 4.7 4.8 4.7 4.7 
     Other semi-manufactures 4.9 4.9 4.7 4.9 
     Machinery and transport equipment 28.9 25.4 24.9 25.8 
          Office and telecommunication equipment 12.4 10.3 9.8 10.0 
               Electronic data processing and office equipment 4.6 3.8 3.9 4.1 
               Integrated circui ts and electronic components 2.8 2.2 1.5 1.3 
               Telecommunication equipment 4.9 4.3 4.4 4.6 
          Transport equipment 7.3 6.0 5.9 6.0 
               Automotive products 2.9 2.9 2.8 2.9 
               Other transport equipment 4.4 3.1 3.2 3.2 
          Other machinery 9.3 9.2 9.2 9.8 
               Electrical machinery 3.8 3.6 3.6 3.9 
               Non-electrical machinery 3.7 3.9 3.8 3.9 
               Power ge nerating machinery 1.8 1.7 1.9 2.0 
     Textiles 1.3 1.3 1.2 1.3 
     Clothing 4.5 4.3 4.0 4.3 
     Other manufactures 8.9 8.3 8.3 8.6 
Other products 3.3 3.4 4.1 2.5 
Source: Eurostat. Viewed at: 
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database . WT/TPR/S/317 • European Union 
 
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  Table A1.10 Inward FDI stocks, 2013 
(€ million) 
Intra-EU Extra EU
European Union (28 countries) 5,933,069.6 3,777,966.8
Belgium .. .. 
Bulgaria 29,240.7 7,511.0 
Czech Republic 86,576.1 11,732.7 
Denmark 53,359.4 18,670.7 
Germany 483,026.0 188,812.0 
Estonia 12,292.6 2,923.9 
Ireland 216,059.0 70,883.0 
Greece 14,346.0 2,924.0 
Spain 379,471.0 93,743.0 
France 408,220.0 159,771.0 
Italy 229,716.2 31,984.2 
Cyprus 14,698.0 31,276.0 
Latvia 8,065.0 3,505.0 
Lithuania 10,392.9 2,327.0 
Luxembourg 472,209.7 672,967.9 
Hungary 112,861.9 68,875.8 
Malta 99,907.6 33,678.4 
Netherlands 1,587,159.0 1,559,387.0 
Austria .. .. 
Poland 144,755.5 15,449.8 
Portugal .. .. 
Romania 54,439.7 5,701.2 
Slovenia 7,343.0 1,583.0 
Slovakia .. .. 
Finland 58,288.7 4,916.6 
Sweden 211,878.3 70,311.2 
United Kingdom .. .. 
.. Not available. 
 Note: Data reported according to BPM6.  Source: Eurostat online  database. Viewed at: http://ec.europa.eu/eurostat/data/database . WT/TPR/S/317 • European Union 
 
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  Table A2.1 Selected notifications to  the WTO, January 2013-March 2015 
Legal provision Description of 
requirement Frequency WTO document 
General Agreement on Tariffs and Trade 1994  
Article XXVIII:5 Reservation of rights 
to modify schedule Ad hoc G/MA/291, 4 August 2014 
Article XVII:4(a) and 
paragraph 1 of the 
Understanding on the Interpretation of Article XVII State-trading 
enterprises and products traded by 
them Every two 
years (new and 
full notifications) G/STR/N/15/EU, 30 June 2014 
 
Article XXIV:7(a) Customs unions and 
free-trade areas Ad hoc WT/REG354/N/1, 3 July 2014 
WT/REG353/N/1, 2 July 2014 
WT/REG352/N/1, 2 July 2014 
WT/REG337/N/1, 25 April 2013 
WT/REG333/N/1/Rev.1, 
21 March 2013 
WT/REG332/N/1, 27 February 2013 
Agreement on Agriculture  
Article 18.2 Imports under tariff 
quotas (Table MA:2) Annual G/AG/N/EU/16, 14 November 2013 
(covers the marketing years 2011/12 
and the calendar years 2012) 
 
Article 5.7 and 18.2 Special safeguard 
(Table MA:5) Annual G/AG/N/EU/19, 5 May 2014 (covers 
the marketing year 2012/13)  G/AG/N/EU/13, 12 Ju ne 2013 (covers 
the marketing year 2011/12) 
Article 18.2 and 18.3 Domestic support Annual/ad hoc 
(DS:1, and 
DS:2) G/AG/N/EU/20, 22 October 2014 
(covers the marketing year 2011/12) 
G/AG/N/EU/17, 13 February 2014 
(covers the marketing year 2010/11) 
G/AG/N/EU/10/Rev.1, 
13 February 2014 (covers the 
marketing year 2009/10) 
Article 18.2 Export subsidies 
(Tables ES:1, ES:2, 
and ES:3) Annual G/AG/N/EU/22, 17 December 2014 
(covers the marketing years 
2012/13) G/AG/N/EU/18, 17 December 2014 (covers the marketing years 2011/12) 
G/AG/N/EU/14, 13 Ju ne 2013 (covers 
the marketing years 2010/11) 
Article 16.2 Possible negative 
effects of the reform 
programme on 
least-developed and 
net food-importing 
developing countries Annual G/AG/N/EU/21, 31 October 2014 
(covers the calendar years 2012 and 
2013) 
G/AG/N/EU/15, 4 September 2013 
(covers the calendar years 2010 and 
2011) 
Agreement on the Application of Sanitary and Phytosanitary Measures  
Article 7 and Annex B, 
paragraph 5 Proposed and 
adopted SPS 
regulations Ad hoc Several notifications (series 
G/SPS/N/EU) 
Agreement on Technical Barriers to Trade  
Articles 2, 3, 5, and 7 Proposed and 
adopted technical 
regulations and 
conformity 
assessment 
procedures Prior to or, for 
urgent 
problems, 
immediately 
after the 
measure is 
taken Several notifications (series 
G/TBT/N/EU) WT/TPR/S/317 • European Union 
 
- 184 - 
 
  Legal provision Description of 
requirement Frequency WTO document 
Article 10.7   G/TBT/10.7/N/121, 7 February 2013 
Paragraph J of the 
Code of Good Practice 
for the Preparation, 
Adoption and 
Application of 
Standards Work programme of 
bodies that have 
accepted the Code Semi-annual ISO/IEC, WTO TBT Standards Code 
Directory 
Agreement on Implementation of Article VI  of the GATT 1994 (Anti-Dumping Agreement)  
Article 16.4 Anti-dumping actions Semi-annual G/ADP/N/265/EU, 31 March 2015 
G/ADP/N/259/EU, 5 September 2014 
G/ADP/N/252/EU, 14 March 2014 
G/ADP/N/244/EU, 
20 September 2013 
G/ADP/N/237/EU, 8 April 2013 
Article 16.4 Anti-dumping actions Ad hoc G/ADP/N/267, 22 January 2015 
G/ADP/N/266, 18 December 2014 
G/ADP/N/264, 21 November 2014 
G/ADP/N/255, 24 March 2014 G/ADP/N/251, 19 December 2013 G/ADP/N/250, 15 November 2013 G/ADP/N/248, 14 October 2013 G/ADP/N/242, 30 May 2013 
G/ADP/N/240, 15 March 2013 
Article 18.5 New or changes to 
laws or regulations 
relevant to the 
Agreement and in 
the administration of 
such laws and 
regulations Ad hoc G/ADP/N/1/EU/1/Rev.1, 
10 April 2014 
G/ADP/N/1/EU/2, 17 January 2013 
Agreement on Rules of Origin  
Annex II, paragraph 4 Preferential rules of 
origin Once, then 
changes and 
new rules G/RO/N/121-123, 14 October 2014 
G/RO/N/90, 93-94, 9 April 2013 
Agreement on Import Licensing Procedures  
Articles 1.4(a), 5, and 
8.2(b) Import licensing 
procedures Ad hoc G/LIC/N/1/EU/4, 14 August 2013 
G/LIC/N/1/EU/5, 13 August 2013 
G/LIC/N/1/EU/3, 13 August 2013 
G/LIC/N/2/EU/5, 14 August 2013 
G/LIC/N/2/EU/3, 14 August 2013 
G/LIC/N/2/EU/4, 13 August 2013 
Article 7.3 Questionnaire Annual G/LIC/N/3/EU/3, 6 November 2014 
G/LIC/N/3/EU/2, 9 December 2013 
Agreement on Subsidies and Countervailing Measures  
Article 25.1 Subsidies Every two 
years (new and 
full 
notifications) G/SCM/N/253/EU, 29 July 2013 
Article 25.11 Countervailing duties 
actions Semi-annual G/SCM/N/274/EU, 5 September 2014
G/SCM/N/267/EU, 11 March 2014 
G/SCM/N/259/EU, 23 September 
2013 
G/SCM/N/250/EU, 8 April 2013 
Article 25.11 Countervailing duties 
actions Ad hoc G/SCM/N/286, 20 March 2015 
G/SCM/N/283, 21 January 2015 G/SCM/N/280, 17 November 2014 G/SCM/N/270, 14 March 2014 G/SCM/N/268, 17 January 2014 G/SCM/N/264, 9 October 2013 
G/SCM/N/257, 16 May 2013 
G/SCM/N/255, 15 March 2013 WT/TPR/S/317 • European Union 
 
- 185 - 
 
  Legal provision Description of 
requirement Frequency WTO document 
Agreement on Safeguards  
Article 12.1(a) Initiation/termination 
of an investigation Ad hoc Last notification in 2011 
Article 12.6 Legislation Ad hoc G/SG/N/1/EU/1, 17 February 2014 
General Agreement on Trade in Services  
Article III:3 New or changes to 
laws or regulations 
that significantly 
affect trade in 
services Annual S/C/N/794-802, 18 March 2015 
S/C/N/720-726, 13 February 2014 
S/C/N/684-688, 13 March 2015 
Articles III:4 and IV:2 Contact and enquiry 
points Once, then 
changes Last notification in 2009 
Article V:7(a) Economic integration 
agreements Ad hoc S/C/N/745, 3 July 2014 
S/C/N/744, 2 July 2014 
S/C/N/743, 2 July 2014 
S/C/N/716, 6 January 2014 
S/C/N/693, 25 April 2013 
S/C/N/681/Rev.1, 21 March 2013 
S/C/N/680, 27 February 2013 
Agreement on Trade-Related Aspects of Intellectual Property Rights  
Article 63.2 Laws and regulations Once, then 
changes Several notifications (series 
IP/N/1/EU), 
Last notification in 2014 
Article 69 Contact points Once, then 
changes Last notification in 2011 
TRIPS Council meeting 
of 22-25 July 1996 Contact points for 
technical cooperation Once, then 
changes Last notification in 2011 
Agreement on Government Procurement  
WTO document GPA/1, 
Annex 3 National threshold Biennial GPA/W/325/Add.5, 7 January 2014 
Article XIX:5 Procurement 
statistics Annual GPA/114/Add.5, 22 October 2014 
GPA/108/Add.7, 22 October 2014 GPA/102/Add.7, 25 March 2013 
Other  
GATT document 
L/4903 (Decision of 
28 November 1979) MFN derogation in 
favour of developing countries Ad hoc WT/COMTD/N/41, 21 January 2013 
 
WTO document G/L/59 
(Decision on 
Notification Procedures 
for Quantitative 
Restrictions) Quantitative 
restrictions Biennial G/MA/QR/N/EU/2, 9 October 2014 
G/MA/QR/N/EU/1, 8 May 2013 
Source:  WTO Secretariat.  
  WT/TPR/S/317 • European Union
 
- 186 - Table A2.2 Status of dispute-related WTO matte rs involving the EU, March 2013– February 2015 
Subject of dispute Raised by/against 
(WTO document) Request for 
consultations Panel established/ 
panel report circulated AB report 
circulateda Other developments 
As respondent       
Countervailing measures on certain 
polyethylene terephthalate Pakistan (WT/DS486) 05.11.2014 No  Consultations held 17.12.2014 
Anti-dumping measures on biodiesel from 
Indonesia Indonesia 
(WT/DS480) 10.06.2014 No  In consultations 
Certain measures relating to the energy 
sector Russian Federation 
(WT/DS476) 30.04.2014 No  In consultations 
Cost adjustment methodologies and 
Certain anti-dumping measures on imports from the Russian Federation Russian Federation 
(WT/DS474) 23.12.2013 Panel established 
22.07.2014   
Anti-dumping measures on biodiesel from 
Argentina Argentina 
(WT/DS473) 19.12.2013 Panel composed 23.06.2014  In consultations 
Measures on atlanto-scandian herring Denmark 
(WT/DS469) 04.11.2013 n.a.  Withdrawn (mutually agreed 
solution) on 21.08.2014 
Certain measures on the importation and 
marketing of biodiesel and measures 
supporting the biodiesel industry Argentina 
(WT/DS459) 15.05.2013 No  In consultations 
Certain measures affe cting the renewable 
energy generation sector China (WT/DS452) 05.11.2012 No  The EU accepted the request 
of Japan to join the 
consultations on 19.11.2012. Australia and Argentina requested to join the consultations on 19.11.2012. 
Certain measures concerning the 
importation of biodiesels Argentina 
(WT/DS443) 17.08.2012 No   
Anti-dumping measures on imports of certain fatty alcohols from Indonesia  Indonesia 
(WT/DS442) 30.07.2012 Panel composed on 
18.12.2014   
Seizure of generic drugs in transit Brazil (WT/DS409) 12.05.2010 No n.a. In consultations 
Seizure of generic drugs in transit India (WT/DS408) 11.05.2010 No n.a. In consultations 
Anti-dumping measures on certain 
footwear China (WT/DS405) 04.02.2010 18.05.2010/ 
28.10.2011 No Implementation notified by 
respondent on 17.12.2012 
Measures prohibiting the importation and 
marketing of seal products Norway (WT/DS401) 05.11.2009 21.04.2011 22.05.2014 Reasonable period of time 
expires on 18.10.2015 
Measures prohibiting the importation and 
marketing of seal products Canada (WT/DS400) 02.11.2009 25.03.2011 22.05.2014 Reasonable period of time 
expires on 18.10.2015 
Definitive anti-dumping measures on 
certain iron or steel fasteners China (WT/DS397) 31.07.2009 23.10.2009/ 
03.12.2010 15.07.2011 Implementation notified by 
respondent on 23.10.2012 
Certain measures affecting poultry meat 
and poultry meat products United States 
(WT/DS389) 16.01.2009 19.11.2009 n.a. None  
  WT/TPR/S/317 • European Union
 
- 187 - Subject of dispute Raised by/against 
(WTO document) Request for 
consultations Panel established/ 
panel report circulated AB report 
circulateda Other developments 
Expiry reviews of anti-dumping and 
countervailing duties imposed on imports 
of PET India (WT/DS385) 04.12.2008 No n.a. None 
Tariff treatment of certain information 
technology products Chinese Taipei 
(WT/DS377) 12.06.2008 23.09.2008/ 
16.08.2010 No Implementation notified by 
respondent on 20.07.2011 
Tariff treatment of certain information 
technology products Japan (WT/DS376) 28.05.2008 23.09.2008/ 
16.08.2010 No Implementation notified by 
respondent on 20.07.2011 
Tariff treatment of certain information 
technology products United States 
(WT/DS375) 28.05.2008 23.09.2008/ 
16.08.2010 No Implementation notified by 
respondent on 20.07.2011 
Certain measures prohibiting the importation and marketing of seal products Canada (WT/DS369) 25.09.2007 25.03.2011  Panel established, but not yet 
composed on 25.03.2011 
Regime for the importation of bananas Panama (WT/DS364) 22.06.2007 No  Settled or terminated 
(withdrawn, mutually agreed 
solution) on 08.11.2012 
Regime for the importation of bananas Colombia 
(WT/DS361) 21.03.2007 No  Settled or terminated 
(withdrawn, mutually agreed solution) on 08.11.2012 
Measures affecting the tariff quota for 
fresh or chilled garlic Argentina 
(WT/DS349) 06.09.2006   In consultations on 
06.09.2006 
Definitive safeguard measure on salmon Norway  (WT/DS328) 01.03.2005   In consultations on 
01.03.2005 
Measures affecting trade in large civil 
aircraft United States 
(WT/DS316) 06.10.2004 20.07.2005/ 
30.06.2010 18.05.2011 Compliance proceeding 
on-going on 13.04.2012 
Aid for commercial vessel s Korea, Republic of 
(WT/DS307) 13.02.2004   In consultations on 
13.02.2004 
Measures affecting imports of wine Argentina 
(WT/DS263) 04.09.2002   In consultations on 
04.09.2002 
Provisional safeguard measures on imports 
of certain steel products United States 
(WT/DS260) 30.05.2002 16.09.2002  Panel established, but not yet 
composed on 16.09.2002 
Generalized System of Preferences Thailand (WT/DS242) 07.12.2001   In consultations on 
07.12.2001 
Tariff-rate quota on corn gluten feed from the United States Unites States 
(WT/DS223) 25.01.2001   In consultations on 
25.01.2001 
Measures affecting soluble coffee Brazil (WT/DS209) 12.10.2000   In consultations on 
12.10.2000 
As complainant       
Tariff treatment of certain agricultural and 
manufacturing products Russian Federation 
(WT/DS485) 31.10.2014 No  Consultations held on 
27.11.2014 
Recourse to article 22.2 of the DSU in the U.S. — Clove cigarettes dispute Indonesia (WT/DS 
481) 13.06.2014 No    
  WT/TPR/S/317 • European Union
 
- 188 - Subject of dispute Raised by/against 
(WTO document) Request for 
consultations Panel established/ 
panel report circulated AB report 
circulateda Other developments 
Anti-dumping duties on light commercial 
vehicles from Germany and Italy Russian Federation 
(WT/DS479) 21.05.2014 Panel composed on 
18.12.2014. Timetable not 
yet available   
Measures on the importation of live pigs, 
pork and other pig products from the European Union Russian Federation 
(WT/DS475) 08.04.2014 23.10.2014   
Certain measures concerning taxation and 
charges Brazil (WT/DS472) 19.12.2013 Panel established, but not 
yet composed (at the time 
of writing)   
Recycling fee on motor vehicles Russian Federation 
(WT/DS462) 09.07.2013 Panel established, but not 
yet composed   
Measures imposing anti-dumping duties on 
high-performance stainless steel seamless 
tubes (“HP-SSST”) from the European 
Union China (WT/DS460) 13.06.2013 11.09.2013   
Measures affecting the importation of 
goods Argentina 
(WT/DS438) 25.05.2012 28.01.2013 n.a.  
Measures related to the exportation of rare 
earths, tungsten and molybdenum China (WT/DS432) 13.03.2012 23.07.2012 n.a. Panel report under appeal 
from Canada (05.02.2013) and 
the EU (11.02.2013) 
Measures relating to the feed-in tariff 
program Canada (WT/DS426) 11.08.2011 20.01.2012/19.12.2012 n.a. Panel report under appeal on 
05.02.2013 
Definitive anti-dumping duties on X-ray 
security inspection equipment from the 
European Union China (WT/DS425) 25.07.2011 20.01.2012/26.02.2013   
Anti-dumping measures on imports of stainless steel sheet and strip in coils from Italy United States 
(WT/DS424) 01.04.2011 n.a.   
Provisional anti-dumping duties on certain 
iron and steel fasteners China (WT/DS407) 07.05.2010 No n.a. In consultation 
Taxes on distilled spirits Philippines 
(WT/DS396) 29.07.2009 19.01.2010 21.12.2011 Implementation notified by 
respondent on 28.01.2013 
Measures related to the exportation of 
various raw materials China (WT/DS395) 23.06.2009 21.12.2009 30.01.2012 Implementation notified by 
respondent on 28.01.2013 
Certain taxes and other measures on imported wines and spirits India (WT/DS380) 22.09.2008 No n.a. None 
Customs valuation of certain products 
from the European Communities Thailand (WT/DS370) 25.01.2008 No n.a.  
Measures affecting trade in large civil 
aircraft — second complaint United States 
(WT/DS353) 27.06.2005 17.02.2006/31.03.2011 12.03.2012 Compliance proceedings 
ongoing on 23.10.2012 
Countervailing duties on olive oil, wheat 
gluten and peaches Argentina 
(WT/DS330) 29.04.2005   In consultations  
  WT/TPR/S/317 • European Union
 
- 189 - Subject of dispute Raised by/against 
(WTO document) Request for 
consultations Panel established/ 
panel report circulated AB report 
circulateda Other developments 
Section 776 of the Tariff Act of 1930 United States 
(WT/DS319) 05.11.2004   In consultations on 
05.11.2004 
Measures affecting trade in large civil 
aircraft United States 
(WT/DS317) 06.10.2004 20.07.2005  Panel composed on 
20.07.2005 
Anti-dumping measures on imports of certain products from the European Communities India (WT/DS304) 08.12.2003   In consultations on 
08.12.2003 
Laws, regulations and methodology for 
calculating dumping margins (zeroing) United States 
(WT/DS294) 12.06.2003 19.03.2004/ 
31.10.2005. Then Article 
21.5 circulated on 
17.12.2008 18.04.2006. 
then 
Article 21.5 
circulated on 
14.05.2009 Report(s) adopted, with 
recommendation to bring 
measure(s) into conformity on 
02.07.2012 
n.a. Not applicable.  a AB refers to Appellate Body.  Source: WTO Secretariat. WT/TPR/S/317 • European Union 
 
- 190 - 
 
  Table A3.1 Tariffs under preferential agreements (2014) 
  Simple average tariff rate 
(%) Duty-free rates as a 
percentage of total tariff lines 
in each category (%) 
  Overall WTO 
Agri. WTO 
Non-Agr.Overall WTO 
Agri. WTO Non-
Agr. 
MFN 6.4 14.4 4.3 25.1 19.2 26.8 
Albania 0.3 1.1 0.1 97.5 92.2 98.9 
Algeria 2.5 12.2 0.0 84.4 29.5 99.9 
Andorra 0.0 0.2 0 99.0 95.3 100.0 
Bosnia and Herzegovina 0.3 1.0 0.1 97.5 92.3 98.9 
Central America 1.5 7.3 0.0 90.3 58.2 99.3 
Ceuta-Melilla  2.6 12.4 0.0 84.7 31.2 99.8 
Chile 1.9 9.0 0.0 89.9 55.1 99.8 
Colombia 1.2 5.6 0.0 93.3 69.8 99.9 
EEA 3.0 13.4 0.3 78.6 24.1 94.1 
Egypt 0.2 0.8 0.0 99.0 95.7 99.9 
EPA 0.0 0.1 0.0 99.0 96.5 99.8 
CARIFORUM 0.0 0.1 0.0 99.0 96.5 99.8 
   CARIFORUM-Haiti 6.4 14.4 4.3 25.1 19.2 26.8 
Eastern and Southern Africa (ESA) 0.0 0.1 0.0 99.0 96.5 99.8 
Faroe Islands 3.3 13.9 0.6 79.5 21.8 95.8 
FYROM 0.3 1.1 0.0 97.9 92.2 99.5 
Iceland 4.8 7.6 4.1 34.3 57.0 27.9 
Israel 0.6 2.5 0.1 95.8 82.0 99.7 
Jordan 0.7 0.2 0.8 94.3 95.8 93.8 
Korea, Republic of  0.5 1.0 0.3 92.8 92.2 92.9 
Lebanon 0.2 1.1 0.0 97.5 88.5 99.9 
Liechtenstein 5.7 11.3 4.3 29.3 36.5 27.2 
Mexico 1.8 8.4 0.0 90.6 57.8 99.9 
Moldova 0.0 0.0 0 99.7 98.6 100.0 
Montenegro 0.3 1.0 0.1 97.5 92.3 98.9 
Morocco 0.1 0.4 0 99.5 97.7 100.0 
Norway 5.9 12.1 4.3 28.3 33.3 26.8 
Overseas countries & territories 0.1 0.4 0 98.9 94.8 100.0 
Palestinian Authority 0.0 0.0 0 99.8 98.9 100.0 
Papua New Guinea 0.0 0.1 0.0 99.0 96.5 99.8 
Peru 1.1 5.1 0.0 93.8 72.1 99.9 
San Marino 0.0 0.1 0.0 99.1 96.3 99.9 
Serbia 0.3 1.1 0.1 97.6 92.2 99.1 
South Africa 1.3 4.3 0.5 89.4 73.6 93.8 
Switzerland 2.8 10.5 0.8 82.1 39.6 94.1 
Syria 3.4 13.5 0.8 78.4 24.2 93.8 
Tunisia 2.5 12.0 0.0 84.3 29.8 99.8 
Turkey 1.6 8.0 0.0 90.4 56.4 99.9 
GSP 4.1 12.5 1.9 57.0 25.1 66.1 
   Chinaa 6.2 14.0 4.2 26.1 20.5 27.6 
   Indiaa 4.8 12.6 2.7 48.7 23.6 55.8 
   Indonesiaa 4.3 12.9 2.1 54.0 22.5 62.9 
   Nigeria  4.1 12.5 2.0 56.9 25.1 66.0 
   Thailanda 4.4 13.5 2.0 56.8 24.5 65.9 
   Ukrainea 4.1 12.5 1.9 56.8 25.1 65.7 
GSP+ 1.8 8.9 0.0 89.1 54.4 99.0 
EBA 0.0 0 0.0 99.8 100.0 99.8 
a Sector graduations from Standard GSP are taken into account. 
Note: 0.0 refers to  >0 and <0.05. 
 All tariff calculations exclude in-quo ta lines. If no preferential rate  is applied, the corresponding MFN 
rate is used for the calculations. The 2014 tariff is based on HS12 nomenclature consisting of 9,379 tariff lines (at 8-digit tariff line level). Ad valorem  equivalents (AVEs) were estimated based on 2013 
import data at the 8-digit tariff from Eurostat database. In case of unavailability, the ad valorem  
part is used for compou nd and alternate rates. 
Source: WTO Secretariat calculations based on IDB database and Eurostat database.  
  WT/TPR/S/317 • European Union
 
- 191 - Table A3.2 Contingency measures, January 2007-November 2014  
Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
Anti-dumping   
Measures in force (within five-year period)
Korea, Republic of 12-Aug-09 11-May-10 Steel ropes and cables Iron and Steel
China 18-Ma r-09 16-Jun-10 Cargo scanning systems Electronics
China 08-Ap r-09 16-Jun-10 Molybdenum wires Other metals
China 11-Aug-09 28-Oct-10 Sodium gluconate Chemical and allied 
China 13-Aug-09 28-Oct-10 Aluminium road wheels Other mechanical 
engineering 
China 08-Sep-09 01-Dec-10 Polyester high tenacity filament yarn Textiles and allied 
China 02-Oct-09 22-Dec-10 Ironing boards Othe r
China 17-Dec-09 15-Ma r-11 filament glass fibre products Other
Canada 12-Aug-10 11-May-11 Biodiesel Othe r
China 17-Feb-10 13-May-11 Melamine Chemical and allied 
Bosnia and Herzegovina 17-Feb-10 14-May-11 Zeolite A powde r Chemical and allied 
China 18-Feb-10 14-May-11 Coated fine pape r Wood and pape r 
Malaysia 28-Oct-10 26-Jul-11 Fasteners, iron or steel Iron and steel
China 20-May-10 09-Aug-11 Open mesh fabrics of glass fibres Other
Thailand 20-May-10 09-Aug-11 Ringbinder mechanisms Other mechanical 
engineering 
China 19-Jun-10 16-Sep-11 Ceramic tiles Other
India 13-Aug-10 11-Nov-11 Fatty alcohols and their blends Chemical and allied 
Indonesia 13-Aug-10 11-Nov-11 Fatty alcohols and their blends Chemical and allied 
Malaysia 13-Aug-10 11-Nov-11 Fatty alcohols and their blends Chemical and allied 
China 30-Sep-10 21-Dec-11 Seamless pipes and tubes of stainless steel Iron and steel
Malaysia 18-May-11 13-Jan-12 Molybdenum wires Other metals
India 26-Jan-11 19-Ap r-12 Oxalic acid Chemical and allied 
China 26-Jan-11 19-Ap r-12 Oxalic acid Chemical and allied 
Malaysia 11-Nov-11 25-Jul-12 Open mesh fabrics of glass fibres Other 
  WT/TPR/S/317 • European Union
 
- 192 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
China 12-Aug-11 10-Nov-12 Aluminium radiators Other mechanical 
engineering 
Chinese Taipei 24-May-12 17-Jan-13 Open mesh fabrics of glass fibres Other
Thailand 24-May-12 17-Jan-13 Open mesh fabrics of glass fibres Othe r
Russian Federation 01-Nov-11 30-Jan-13 Tube and pipe fittings, of iron or steel Iron and steel
Turkey 01-Nov-11 30-Jan-13 Tube and pipe fittings, of iron or steel Iron and steel
United States 25-Nov-11 23-Feb-13 Bioethanol Chemical and allied 
Philippines 14-Jun-12 13-Ma r-13 Stainless steel fasteners and parts thereof Iron and steel
China 18-Dec-11 14-Ma r-13 Aluminium Foil in small rolls Other metals
China 21-Dec-11 19-Ma r-13 Organic coated steel products Iron and steel
Chinese Taipei 07-Jul-12 06-Ap r-13 Silicon metal (silicon) Other metals
China 16-Feb-12 15-May-13 Threaded tube or pipe cast fittings of malleable cast iron Iron and steel
Thailand 16-Feb-12 15-May-13 Threaded tube or pipe cast fittings of malleable cast iron Iron and steel
China 16-Feb-12 16-May-13 Ceramic tableware and kitchenware Othe r
Indonesia 27-Sep-12 06-Jun-13 Bicycles Other mechanical 
engineering 
Malaysia 27-Sep-12 06-Jun-13 Bicycles Other mechanical 
engineering 
Sri Lanka 27-Sep-12 06-Jun-13 Bicycles Other mechanical 
engineering 
Tunisia 27-Sep-12 06-Jun-13 Bicycles Other mechanical 
engineering 
India 10-Aug-12 09-Nov-13 Stainless steel wire Iron and steel
Argentina 29-Aug-12 26-Nov-13 Biodiesel Othe r
Indonesia 29-Aug-12 26-Nov-13 Biodiesel Other
China 06-Sep-12 06-Dec-13 Solar panels (crystalline silicon photovoltaic modules and key 
components) Electronics
China 28-Feb-13 15-May-14 Solar glass Other
Indonesia 10-Ap r-13 21-Dec-13 Open mesh fabrics of glass fibres Othe r
India 10-Ap r-13 21-Dec-13 Open mesh fabrics of glass fibres Other
Measures in force through extension (after five-year period)
China 01-Feb-89 28-Jul-90 Silicon metal (silicon) Other metals 
  WT/TPR/S/317 • European Union
 
- 193 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
China   27-Sep-90 Tungsten carbide and fused tungsten carbide Chemical and allied 
China   09-Sep-93 Bicycles Other mechanical 
engineering 
Russian Federation 09-Jun-94 23-Aug-95 Ammonium nitrate Chemical and allied 
China 03-Feb-94 03-Ap r-96 Tube and pipe fittings, of iron or steel Iron and steel
China 19-Ap r-96 18-Jan-97 Bicycles (parts) Other mechanical 
engineering 
China 28-Oct-95 24-Jan-97 Ringbinder mechanisms Other mechanical 
engineering 
China 20-May-98 17-Aug-99 Steel ropes and cables Iron and steel
Ukraine 20-May-98 17-Aug-99 Steel ropes and cables Iron and steel
Chinese Taipei 30-Jul-99 14-Ap r-00 Tube and pipe fittings, of iron or steel Iron and steel
India 06-Jul-01 25-Jul-02 Sulphanilic acid Chemical and allied 
China 06-Jul-01 25-Jul-02 Sulphanilic acid Chemical and allied 
Korea, Republic of 01-Jun-01 24-Aug-02 Tube and pipe fittings, of iron or steel Iron and steel
Malaysia 01-Jun-01 24-Aug-02 Tube and pipe fittings, of iron or steel Iron and steel
Ukraine 29-Jun-01 27-Sep-02 Welded tubes and pipes of iron or non-alloy steel Iron and steel
Indonesia 19-Dec-02 11-Ma r-04 Sodium cyclamate Chemical and allied 
China 19-Dec-02 11-Ma r-04 Sodium cyclamate Chemical and allied 
Moldova 30-Jul-03 24-Ap r-04 Steel ropes and cables Iron and steel
Viet Nam 01-Oct-03 01-Jul-04 Ringbinder mechanisms Other mechanical 
engineering 
China 22-May-03 19-Aug-04 Polyethylene terephthalate (PET) Chemical and allied 
India 21-Aug-03 18-Sep-04 Graphite electrode systems Other
Morocco 18-Feb-04 30-Oct-04 Steel ropes and cables Iron and steel
China 19-Aug-03 12-Nov-04 Okoumé plywood Wood and pape r 
Indonesia 03-Ma r-04 01-Dec-04 Tube and pipe fittings, of iron or steel Iron and steel
Sri Lanka 03-Ma r-04 01-Dec-04 Tube and pipe fittings, of iron or steel Iron and steel
China 29-Ap r-04 21-Jul-05 Hand pallet trucks and their essential parts Other mechanical 
engineering 
China 30-Ap r-04 21-Jul-05 Barium carbonate Chemical and allied 
China 10-Jul-04 07-Oct-05 Trichloroisocyanuric acid (TCCA) Chemical and allied  
  WT/TPR/S/317 • European Union
 
- 194 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
China 24-Aug-04 19-Nov-05 Stainless steel fasteners and parts thereof Iron and steel
Chinese Taipei 24-Aug-04 19-Nov-05 Stainless steel fasteners and parts thereof Iron and steel
Laos 13-Ap r-05 12-Jan-06 Ringbinder mechanisms Other mechanical 
engineering 
China 30-Oct-04 27-Jan-06 Tartaric acid Chemical and allied 
Philippines 05-Aug-05 29-Ap r-06 Tube and pipe fittings, of iron or steel Iron and steel
Russian Federation 31-Ma r-05 29-Jun-06 Seamless pipes and tubes of iron or steel Iron and steel
Ukraine 31-Ma r-05 29-Jun-06 Seamless pipes and tubes of iron or steel Iron and steel
China 28-Ap r-05 27-Jul-06 Lever arch mechanisms Other mechanical 
engineering 
China 25-Jun-05 14-Sep-06 Chamois leathe r Other
Korea, Republic of 20-Ap r-06 19-Jan-07 Silicon metal (silicon) Other metals
China 17-Dec-05 13-Ma r-07 Tungsten electrodes Other metals
China 04-Feb-06 26-Ap r-07 Ironing boards Othe r
Thailand 28-Ma r-06 20-Jun-07 Sweet corn (prepared or preserved in kernels) Other
China 13-Jul-06 11-Oct-07 Peroxosulphates (persulphates) Chemical and allied 
China 30-Nov-06 28-Feb-08 Ferro-silicon Other metals
Russian Federation 30-Nov-06 28-Feb-08 Ferro-silicon Other metals
South Africa 21-Dec-06 13-Ma r-08 Manganese dioxides Other metals
China 05-Sep-07 02-Dec-08 Monosodium glutamateaChemical and allied 
China 04-Sep-07 03-Dec-08 Citric acida Chemical and allied 
Belarus 26-Sep-07 19-Dec-08 Welded tubes and pipes of iron or non-alloy steelaIron and steel
China 26-Sep-07 19-Dec-08 Welded tubes and pipes of iron or non-alloy steelaIron and steel
Russian Federation 26-Sep-07 19-Dec-08 Welded tubes and pipes of iron or non-alloy steelaIron and steel
China 20-Oct-07 30-Dec-08 Citrus fruits Other
China 09-Nov-07 31-Jan-09 Fasteners, iron or steelaIron and steel
China 16-Feb-08 13-May-09 PSC wires and strandsaIron and steel
China 16-Feb-08 14-May-09 Candles, tapers and the likeaOther
China 08-May-08 05-Aug-09 Wire roda Iron and steel 
  WT/TPR/S/317 • European Union
 
- 195 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
United States 13-Jun-08 10-Jul-09 Biodiesela Othe r
China 09-Jul-08 06-Oct-09 Seamless pipes and tubes of iron or steelaIron and steel
Brazil 12-Jul-08 06-Oct-09 Aluminium foilaOther metals
China 12-Jul-08 06-Oct-09 Aluminium foilaOther metals
Thailand 20-Sep-08 16-Jun-09 Hand pallet trucks and their essential parts Other mechanical 
engineering 
New investigation initiated duri ng the review period (2013-14)
Indonesia 29-Nov-13 Monosodium glutamate Chemical and allied 
Turkey 15-Feb-14 Rainbow trout Other
Chinese Taipei 26-Jun-14 Stainless steel cold-rolled flat products Iron and steel
China 26-Jun-14 Stainless steel cold-rolled flat products Iron and steel
United States 14-Aug-14 Grain oriented flat-rolled products of silicon-electrical steel Iron and steel
Russian Federation 14-Aug-14 Grain oriented flat-rolled products of silicon-electrical steel Iron and steel
Korea, Republic of 14-Aug-14 Grain oriented flat-rolled products of silicon-electrical steel Iron and steel
Japan 14-Aug-14 Grain oriented flat-rolled products of silicon-electrical steel Iron and steel
China 14-Aug-14 Grain oriented flat-rolled products of silicon-electrical steel Iron and steel
China 04-Sep-14 Acesulfame potassium (ACE-K) Chemical and allied 
Russian Federation 08-Oct-14 Aluminium foil in big rolls Other metals
Measures terminatedb
Chinese Taipei 31-Ma r-01 18-Jun-02 12-Jun-07 Compact disks - recordable (CD-Rs) Electronics
Russian Federation   04-Ma r-95 31-Jul-07 Urea Chemical and allied 
Korea, Republic of   01-Ap r-95 29-Aug-07 Colour television receivers Electronics
Malaysia   01-Ap r-95 29-Aug-07 Colour television receivers Electronics
China   01-Ap r-95 29-Aug-07 Colour television receivers Electronics
Thailand   01-Ap r-95 29-Aug-07 Colour television receivers Electronics
Belarus 03-Aug-94 30-Jul-96 10-Oct-07 Polyester staple fibres Textiles and allied 
Thailand 05-May-00 04-Aug-01 31-Oct-07 Steel ropes and cables Iron and Steel
Turkey 05-May-00 04-Aug-01 31-Oct-07 Steel ropes and cables Iron and Steel 
  WT/TPR/S/317 • European Union
 
- 196 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
China 09-Nov-00 06-Feb-02 30-Jan-08 Ferro molybdenum Other metals
Belarus 21-Oct-00 19-Jan-02 18-Ma r-08 Urea Chemical and allied 
Croatia 21-Oct-00 19-Jan-02 18-Ma r-08 Urea Chemical and allied 
Libya 21-Oct-00 19-Jan-02 18-Ma r-08 Urea Chemical and allied 
Ukraine 21-Oct-00 19-Jan-02 18-Ma r-08 Urea Chemical and allied 
Russian Federation 28-May-04 27-Aug-05 22-May-08 Grain oriented electrical steel sheets (big + small) Iron and Steel
Norway 19-Dec-02 11-Ma r-04 13-Aug-08 Trout (large rainbow trout) Other
Turkey 29-Jun-01 27-Sep-02 19-Dec-08 Welded tubes and pipes of iron or non-alloy steel Iron and Steel
F.Y.R. Macedonia 30-Nov-06 28-Feb-08 30-Dec-09 Ferro-silicon Other metals
China 13-Oct-95 18-Feb-98 16-Dec-10 Glyphosate Chemical and allied 
Malaysia 09-May-01 30-Sep-04 16-Dec-10 Glyphosate Chemical and allied 
Chinese Taipei 09-May-01 30-Sep-04 16-Dec-10 Glyphosate Chemical and allied 
China   11-Dec-93 13-May-11 Magnesia (deadburned) Other metals
China 19-Dec-03 17-Ma r-05 09-Jun-11 Polyester staple fibres Textiles and allied 
China 30-Ap r-04 29-Jul-05 03-Sep-11 Castings Iron and Steel
South Africa 20-May-98 17-Aug-99 10-Feb-12 Steel ropes and cables Iron and Steel
China 23-Nov-92 21-Jan-95 27-Jun-12 Furfuraldehyde Chemical and allied 
Croatia 31-Ma r-05 29-Jun-06 05-Jul-12 Seamless pipes and tubes of iron or steel Iron and Steel
China 30-Jun-05 29-Sep-06 14-Jul-12 Plastic sacks and bags Other
Thailand 30-Jun-05 29-Sep-06 14-Jul-12 Plastic sacks and bags Othe r
United States   02-Feb-94 26-Ma r-13 Ethanolamines Chemical and allied 
India 06-Nov-99 30-Nov-00 24-May-13 Polyethylene terephthalate (PET) Chemical and allied 
Indonesia 06-Nov-99 30-Nov-00 24-May-13 Polyethylene terephthalate (PET) Chemical and allied 
Malaysia 06-Nov-99 30-Nov-00 24-May-13 Polyethylene terephthalate (PET) Chemical and allied 
Chinese Taipei 06-Nov-99 30-Nov-00 24-May-13 Polyethylene terephthalate (PET) Chemical and allied 
Thailand 06-Nov-99 30-Nov-00 24-May-13 Polyethylene terephthalate (PET) Chemical and allied 
Russian Federation 05-May-00 04-Aug-01 18-Dec-13 Steel ropes and cables Iron and Steel 
  WT/TPR/S/317 • European Union
 
- 197 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
Ukraine 04-Feb-06 26-Ap r-07 24-Jul-13 Ironing boards Othe r
China 17-Aug-06 15-Nov-07 14-Feb-14 Dicyandiamide Chemical and allied 
China 02-Ma r-94 05-Jun-96 19-Aug-14 Powdered activated carbon Chemical and allied 
Measures expiredc  
China 20-Dec-00 05-Ma r-02 01-Ma r-07 Zinc oxides Chemical and allied 
Indonesia 18-May-01 08-Jun-02 05-Jun-07 Ringbinder mechanisms Other mechanical 
engineering 
Russian Federation 01-Jun-01 24-Aug-02 15-Aug-07 Tube and pipe fittings, of iron or steel Iron and Steel
India 09-Nov-01 28-Nov-02 23-Nov-07 Polyester textured filament yarn (PTY) Textiles and allied 
Norway 23-Oct-04 20-Jan-06 19-Jul-08 Salmon Othe r
China 27-Jun-02 20-Sep-03 21-Sep-08 Para-cresol Chemical and allied 
China 17-May-00 19-Jul-01 18-Oct-08 Lamps (integrate d electronic compact fluorescent) Electronics
Pakistan 10-Sep-04 09-Jun-05 18-Oct-08 Lamps (integrated electronic compact fluorescent) Electronics
Philippines 10-Sep-04 09-Jun-05 18-Oct-08 Lamps (integrated electronic compact fluorescent) Electronics
Viet Nam 10-Sep-04 09-Jun-05 18-Oct-08 Lamps (integrated electronic compact fluorescent) Electronics
Russian Federation 12-Oct-02 24-Dec-03 25-De c-08 Silicon metal (silicon) Other metals
Pakistan 18-Dec-02 04-Ma r-04 05-Ma r-09 Bed linen Textiles and allied 
Faroe Islands 19-Dec-02 11-Ma r-04 11-Ma r-09 Trout (large rainbow trout) Othe r
Australia 22-May-03 19-Aug-04 20-Aug-09 Polyethylene terephthalate (PET) Chemical and allied 
Korea, Republic of 07-Oct-99 28-Dec-00 18-Ma r-10 Polyester staple fibres Textiles and allied 
Saudi Arabia, Kingdom of 19-Dec-03 17-Ma r-05 18-Ma r-10 Polyester staple fibres Textiles and allied 
China 21-Dec-06 20-Ma r-08 21-Ma r-10 Compressors Other mechanical 
engineering 
China   17-Jun-93 26-May-10 Magnesium oxide (caustic magnesite) Chemical and allied 
Viet Nam 29-Ap r-04 14-Jul-05 15-Jul-10 Bicycles Other mechanical 
engineering 
United States 28-May-04 27-Aug-05 28-Aug-10 Grain oriented electrical steel sheets (big + small) Iron and Steel
China 17-Jun-04 16-Sep-05 17-Sep-10 Polyester filament apparel fabrics (finished) Textiles and allied 
United States 13-Oct-04 07-Oct-05 07-Oct-10 Trichloroisocyanuric acid (TCCA) Chemical and allied 
India 20-May-98 17-Aug-99 17-Nov-10 Steel ropes and cables Iron and Steel 
  WT/TPR/S/317 • European Union
 
- 198 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
Indonesia 24-Aug-04 19-Nov-05 20-Nov-10 Stainless steel fasteners and parts thereof Iron and Steel
Thailand 24-Aug-04 19-Nov-05 20-Nov-10 Stainless steel fasteners and parts thereof Iron and Steel
Viet Nam 24-Aug-04 19-Nov-05 20-Nov-10 Stainless steel fasteners and parts thereof Iron and Steel
China 09-Sep-04 08-Dec-05 09-Dec-10 Granular polytetr afluoroethylene (PTFE) resin Chemical and allied 
Russian Federation 09-Sep-04 08-Dec-05 09-Dec-10 Granular polytetrafluoroethylene (PTFE) resin Chemical and allied 
China 07-Jul-05 06-Oct-06 31-Ma r-11 Footwear with uppers of leathe r Footwea r
Macau, China 06-Sep-07 01-May-08 31-Ma r-11 Footwear with uppers of leathe r Footwea r
Viet Nam 07-Jul-05 06-Oct-06 31-Ma r-11 Footwear with uppers of leathe r Footwea r
China 13-Jul-04 12-Oct-05 25-Jun-11 Magnesia bricks Other
China 20-May-94 04-Ap r-96 08-Jul-11 Coumarin Chemical and allied 
India 08-Ap r-04 31-Dec-04 08-Jul-11 Coumarin Chemical and allied 
Indonesia 29-Ma r-06 10-Nov-06 08-Jul-11 Coumarin Chemical and allied 
Malaysia 29-Ma r-06 10-Nov-06 08-Jul-11 Coumarin Chemical and allied 
Thailand 08-Ap r-04 31-Dec-04 08-Jul-11 Coumarin Chemical and allied 
Belarus   24-Oct-92 12-Jul-11 Potassium chloride Chemical and allied 
Russian Federation   24-Oct-92 12-Jul-11 Potassium chloride Chemical and allied 
China   13-Ap r-94 25-Aug-11 Silicon carbide Chemical and allied 
Korea, Republic of 02-Jun-05 31-Aug-06 01-Sep-11 Refrigerators (side-by-side) Other mechanical 
engineering 
China 09-Aug-02 31-Oct-03 10-Nov-11 Furfuryl alcohol Chemical and allied 
Algeria 26-Jun-99 22-Sep-00 22-Dec-11 Urea ammonium nitrate solutions Chemical and allied 
Belarus 26-Jun-99 22-Sep-00 22-Dec-11 Urea ammonium nitrate solutions Chemical and allied 
Russian Federation 26-Jun-99 22-Sep-00 22-Dec-11 Urea ammonium nitrate solutions Chemical and allied 
Ukraine 26-Jun-99 22-Sep-00 22-Dec-11 Urea ammonium nitrate solutions Chemical and allied 
Korea, Republic of 06-Nov-99 30-Nov-00 28-Feb-12 Polyethylene terephthalate (PET) Chemical and allied 
China 19-Jan-06 17-Ap r-07 18-Ap r-12 Strawberries (frozen) Other
Ukraine 29-Oct-99 25-Jan-01 17-Jun-12 Ammonium nitrate Chemical and allied 
China 07-Ap r-06 21-Jun-07 22-Jun-12 Saddles Other mechanical 
engineering  
  WT/TPR/S/317 • European Union
 
- 199 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
Chinese Taipei 13-Jul-06 11-Oct-07 12-Oct-12 Peroxosulphates (persulphates) Chemical and allied 
United States 13-Jul-06 11-Oct-07 12-Oct-12 Peroxosulphates (persulphates) Chemical and allied 
Brazil 19-Feb-04 18-Nov-04 07-Nov-12 Polyethylene tere phthalate film (PET film) Chemical and allied 
India 27-May-00 23-Aug-01 07-Nov-12 Polyethylene terephthalate film (PET film) Chemical and allied 
Israel 19-Feb-04 18-Nov-04 07-Nov-12 Polyethylene te rephthalate film (PET film) Chemical and allied 
China 06-Sep-06 05-Dec-07 06-Dec-12 Silico-manganese Other metals
Kazakhstan 06-Sep-06 05-Dec-07 06-Dec-12 Silico-manganese Other metals
China   04-May-95 13-Dec-12 Lighters (non-refillable & refillable) Other mechanical 
engineering 
Chinese Taipei 08-May-98 29-Jan-99 13-Dec-12 Lighters (non-refillable & refillable) Other mechanical 
engineering 
Viet Nam 26-Jun-12 27-Jun-12 13-Dec-12 Lighters (non-refillable) Other mechanical 
engineering 
India 11-Nov-06 26-Jan-08 27-Jan-13 Dihydromyrcenol Chemical and allied 
Egypt 30-Nov-06 28-Feb-08 01-Ma r-13 Ferro-silicon Other metals
Kazakhstan 30-Nov-06 28-Feb-08 01-Ma r-13 Ferro-silicon Other metals
China 20-Dec-06 18-Ma r-08 19-Ma r-13 Coke (over 80mm) Other
Thailand 29-Jun-01 27-Sep-02 20-Dec-13 Welded tubes and pipes of iron or non-alloy steel Iron and steel
India 01-Jul-97 26-Jun-98 23-Dec-13 Synthetic fibre ropes Textiles and allied 
Thailand 03-Feb-94 03-Ap r-96 05-Sep-14 Tube and pipe fittings, of iron or steel Iron and steel
Armenia 12-Jul-08 06-Oct-09 07-Oct-14 Aluminium foil Other metals
Countervailing Measures in force (within five-year period)
Iran 03-Sep-09 29-Sep-10 Polyethylene terephthalate (PET) Chemical and allied 
Pakistan 03-Sep-09 29-Sep-10 Polyethylene terephthalate (PET) Chemical and allied 
UAE 03-Sep-09 29-Sep-10 Polyethylene terephthalate (PET) Chemical and allied 
India 01-Ap r-10 28-Ap r-11 Stainless steel bars Iron and steel
China 17-Ap r-10 14-May-11 Coated fine pape r Wood and pape r 
Canada 12-Aug-10 11-May-11 Biodiesel Othe r
China 22-Feb-12 19-Ma r-13 Organic coated steel products Iron and steel
India 10-Aug-12 08-Sep-13 Stainless steel wire Iron and steel 
  WT/TPR/S/317 • European Union
 
- 200 - Partner affected Initiation of 
investigation Imposition of 
measures Withdrawn Product description Sector 
China 08-Nov-12 06-Dec-13 Solar panels (crystalline silicon photovoltaic modules and key 
components) Electronics
China 27-Ap r-13 15-May-14 Solar glass Othe r
Measures in force through extension (after five-year period)
India 06-Nov-99 30-Nov-00 Polyethylene terephthalate (PET) Chemical and allied 
India 06-Jul-01 25-Jul-02 Sulphanilic acid Chemical and allied 
India 21-Aug-03 18-Sep-04 Graphite electrode systems Othe r
United States 13-Jun-08 10-Jul-09 Biodiesel Other
New investigation initiated duri ng the review period (2013-14)
China 14-Aug-14 Stainless steel cold-rolled flat products Iron and steel
Turkey 15-Feb-14 Rainbow trout Othe r
Measures terminated 
India 17-May-02 05-Jun-03 06-Nov-07 Compact disks - recordable (CD-Rs) Electronics
Korea, Republic of 25-Jul-02 22-Aug-03 09-Ap r-08 DRAMs Electronics
India 12-Sep-97 09-Oct-98 12-Aug-11 Antibiotics (broad spectrum) Chemical and allied 
Measures expired
Indonesia 18-May-01 08-Jun-02 05-Jun-07 Ringbinder mechanisms Other mechanical 
engineering 
India 09-Nov-01 28-Nov-02 23-Nov-07 Polyester textured filament yarn (PTY) Textiles and allied 
India 18-Dec-02 17-Jan-04 18-Jan-09 Bed linen Textiles and allied 
Brazil 19-Feb-04 18-Nov-04 09-Ma r-11 Polyethylene terephthalate film (PET film) Chemical and allied 
India 21-Nov-98 10-Dec-99 09-Ma r-11 Polyethylene terephthalate film (PET film) Chemical and allied 
Israel 19-Feb-04 18-Nov-04 09-Ma r-11 Polyethylene terephthalate film (PET film) Chemical and allied 
a Pending the outcome of ongoing expiry review. 
b Terminated following a review investigation. c Expired with no review investigation.  Note: The measures in this table are listed by trading partner affected, including measures extended to other partners followin g anti-circumvention investigations. 
Source: WTO Secretariat, and European  Commission online information.  
  WT/TPR/S/317 • European Union
 
- 201 - Table A3.3 Official export credit ag encies of the EU member States, 2014 
Country Agency Business model Internet link 
Austria Oesterreichische Ko ntrollbank AG (OeKB) Private sector http://www.oekb.at  
Belgium Office national du Ducroire Nationale 
Delcrederedienst (ONDD) Stand-alone government agency http://www.delcredereducroire.be/en/   
Bulgaria Bulgarian Export Insurance Agency (BAEZ) Stand-alone government agency .. 
Croatia Croatian Bank for Reconstruction and Development .. http://www.hbor.hr 
Cyprus Export Credit Insurance Service (ECIS) Stand-alone government agency  http://www.mcit.gov.cy/mcit/trade/ts
.nsf/index_gr/index_gr?OpenDocume
nt 
Czech Republic Export Guarantee and Insurance Corporation (EGAP) Stand-alone government agency http://www.egap.cz  
  Czech Export Bank  http://www.ceb.cz  
Denmark Eksport Kredit Fonden (EKF) Stand-alone government agency http://www.ekf.dk  
Estonia KredEx  http://kredex.ee/en/  
 Credit & Export Guarantee Fund Estonia Stand-alone government agency .. 
Finland Finnvera Oyj Stand-alone government agency http://www.finnvera.fi  
  Finnish Export Credit Ltd (FEC) .. http://www.fec.fi  
France Compagnie française d'Assurance pour le commerce extérieur 
(COFACE) Private sector http://www.coface.fr  
Germany AuslandsGeschäftsAbsicherung der Bundesrepublik Deutschland .. http://www.agaportal.de/en/index.ht
ml  
  Euler Hermes Kreditversicherungs-AG (EH) Private sector http://www.hermes-kredit.com  
Greece Export Credit Insurance Organisation (ECIO) Stand-alone government agency http://www.ecio.gr  
Hungary Hungarian Export Credit Insurance Ltd and Hungarian Export-
Import Bank plc (MEHIB) Stand-alone government agency http://www.exim.hu/en/  
Ireland The Insurance Corporation of Ireland (ICI) Government department .. 
Italy Istituto per i Servizi Assicurativi del Credito 
all'Esportazione (SACE) Stand-alone government agency http://www.sace.it/GruppoSACE/cont
ent/it/index.html  
Latvia Latvian Guarantee Agency (LGA) Stand-alone government agency  http://www.lga.lv/ 
Lithuania INVEGA Stand-alone government agency  .. 
Luxembourg Office du Ducroire (ODD) Stand-alone government agency http://www.ducroire.lu  
Malta Malta Export Credit Guarantee Company Stand-alone government agency  .. 
Netherlands Atradius Private sector http://atradius.com/nl/en/dutchstate
business/index.jsp  
Poland Korporacja Ubezpieczén Kredytów Eksportowych (KUKE) Stand-alone government agency http://www.kuke.com.pl  
Portugal Companhia de Seguro de Créditos S.A. (COSEC) Private sector http://www.cosec.pt  
Romania Eximbank of Romania (EXIM R) Majority state ownership .. 
Slovakia Export-Import Bank of the Slovak Republic (EXIMBANKA) Stand-alone government agency http://www.eximbanka.sk  
Slovenia Slovenska izvozna in razvojna banka, d.d. (SID) Government-owned bank http://www.sid.si/home   
  WT/TPR/S/317 • European Union
 
- 202 - Country Agency Business model Internet link 
Spain Compañía Española de Seguros de Crédito a la Exportación 
(CESCE) Majority state ownership http://www.cesce.es  
  Secretaría de Estado de Come rcio (Ministeri o de Economía) Government department http://www.mcx.es  
Sweden Exportkreditnämnden (EKN) Stand-alone government agency http://www.ekn.se  
  AB Svensk Exportkredit (SEK) .. http://www.sek.se/en  
United Kingdom U.K. Export Finance Government department http://www.ukexportfinance.gov.uk  
.. Not available. 
Source: OECD online information, "Official Export Credits Agencies", viewed at: http://www.oecd.org/trade/exportcredits/eca.htm ; and information provided by the 
European Union.  
  WT/TPR/S/317 • European Union
 
- 203 - Table A3.4 Tax and social contributions in the EU in 2012 
(€ million) 
 Tax receipts 
and social 
contribution 
as % of GDP Total tax 
receipts Value added 
type taxes 
(VAT) Excise 
duties and 
consumption 
taxes Taxes on 
land, 
buildings and 
other 
structures Taxes on 
individual or 
household 
income Taxes on the 
income or 
profits of 
corporationsActual 
social 
contrib-
utions Employers' 
actual social 
contrib-
utions Employees' 
social 
contributionsSocial 
contributions 
by self- and 
non-employed 
persons 
European Union 28 39.6 3,469,715 926,909   316,312    152,321    1,222,546    322,005    1,684,614    959,953    518,346    206,315    
Belgium 45.4 115,608 26,896   6,834    4,663    47,801    11,680    55,073    33,434    16,515    5,124    
Bulgaria 27.7 8,209 3,740   2,032    123    1,171    756    2,861    1,683    975    204    
Czech Republic 35.0 29,720 11,050   3,480    320    5,759    5,065    23,833    15,216    4,847    3,770    
Denmark 48.2 116,366 24,422   8,294    3,335    60,049    7,466    2,316    190    2,126    .. 
Germany 39.4 628,360  194,040   48,270    12,010    234,580    72,140    421,340    180,020    170,080    71,240    
Estonia  32.5 3,659  1,508   .. 59    931    252    2,000    1,845    137    18    
Ireland  28.7 39,849  10,219   832    1,435    15,915    4,005    7,186    5,023    1,864    298    
Greece  33.8 44,376  13,713   7,023    386    13,446    2,174    20,972    9,270    8,816    2,886    
Spain 32.5 219,525  57,057   22,142    11,231   79,728    22,246    123,206    86,520    17,837    18,849    
France 45.0 571,944  142,499   45,158    52,163    172,073    45,983    346,376    235,111    84,376    26,889    
Croatia 35.9 10,652  5,403   1,484    288    1,621    877    5,032    2,629    2,326    77    
Italy 44.0 477,104  95,473   37,187    22,629    191,768    35,284    212,760    145,703    37,659    29,398    
Cyprus 35.3 4,630  1,578   575    68    708    1,114    1,620    1,100    446    75    
Latvia 27.9 4,338  1,583   714    148    1,268    357    1,878    1,282    585    11    
Lithuania 27.2 5,366  2,521   918    86    1,160    433    3,612    2,397    717    499    
Luxembourg 39.3 11,919  3,064   82    28    3,699    2,257    4,961    2,104    2,249    608    
Hungary 39.2 25,175  9,084   3,439    349    5,231    1,252    12,838    7,487    4,922    429    
Malta 33.5 1,890  536   208    .. 462    431    414   190    188    37    
Netherlands 39.0 138,028  41,699   9,007    3,348    45,900    12,740    95,780    32,608    41,726    21,446    
Austria 43.2 86,771  24,563   7,513    707    31,076    7,263    46,114    21,487    18,795   5,832    
Poland 32.5 77,623  27,881   14,366    3,283    17,421    8,125    46,764    18,840    18,542    9,382    
Portugal  32.4 38,468  13,995   3,803    1,202    9,796    4,630    14,999    8,417    6,011    571    
Romania 28.5 25,655  11,212   4,133    522    4,582    2,852    11,792    7,496    3,780    516    
Slovenia  37.6 7,912  2,889   1,583    184    2,065    446    5,380    2,061    2,706    614    
Slovakia  28.3 11,227  4,328   1,973    215    1,862    1,715    8,929    4,810    2,138    1,981    
Finland  44.3 59,621  17,640   7,517    .. 24,989    4,213    25,524    17,698    5,963    1,863    
Sweden  44.4 150,258  37,861   10,587    3,266    61,931    11,013    30,685    29,715    302    667    
United Kingdom 36.7 555,464  140,457   67,159    30,274    185,555    55,236    150,369    85,618    61,720    3,031    
.. Not available. 
Source: Eurostat online database [gov_a_tax_ag]. Viewed at: http://appsso.eurostat.ec.europa.eu/nui /show.do?dataset=gov _a_tax_ag&lang=en  [February 2015] 
 WT/TPR/S/317 • European Union 
 
- 204 - 
 
  Table A3.5 Summary of the main legislat ion on intellectual property rights, 2015 
Intellectual 
property right Legislative measure Notification to Council 
for TRIPS pursuant to 
Article 63.2 TRIPS 
Copyright and 
related rights 
 • Directive 96/9/EC of 11 March 1996 on the legal protection of 
databases 
• Directive 2001/29/EC of 22 May 2001 on the harmonization of 
certain aspects of copyright and related rights in the information society 
• Directive 2012/28/EU of 25 October 2012 on certain permitted 
uses of orphan works 
• Directive 2006/115/EC of 12 December 2006 on rental right 
and lending right and on certain rights related to copyright in 
the field of intellectual property 
• Directive 2006/116/EC of 12 December 2006 on the term of 
protection of copyright and cert ain related rights, as amended 
by Directive 2011/77/EU of 27 September 2011 
• Council Directive 93/83/EEC of 27 September 1993 on the 
coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission 
• Directive 2001/84/EC of 27 September 2001 on the resale right 
for the benefit of the author of an original work of art 
• Council Directive 2009/24/EC of 23 April 2009 on the legal 
protection of computer programmes 
• Council Decision 2000/278/EC of 16 March 2000 on the 
approval, on behalf of the European Community, of the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty 
• Directive 2014/26/EU of the European Parliament and of the 
Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market  
• National laws of EU member States  IP/N/1/EEC/C/2 
IP/N/1/EU/C/1  
 IP/N/1/EU/C/2 IP/N/1/EU/C/3  IP/N/1/EU/C/4  IP/N/1/EU/C/5   IP/N/1/EU/C/6  
IP/N/1/EU/C/7 
 IP/N/1/EU/C/8    IP/N/1/EU/C/9 
Trademarks • Council Regulation (EC) No. 1992/2003 of 27 October 2003 
amending Regulation (EC) No. 40/94 on the Community 
trademark to give effect to the accession of the European 
Community to the Protocol relating to the Madrid Agreement 
concerning the international registration of marks adopted at 
Madrid on 27 June 1989 
• Directive 2008/95/EC of 22 October 2008 to approximate the 
laws of the member States relating to trademarks 
• Council Regulation (EC) No. 207/2009 of 26 February 2009 on 
the Community trademark 
• Commission Regulation (EC) No. 2082/2004 of 6 December 
2004, amending Regulation (EC) No. 216/96 laying down the 
rules of procedure of the Boards of Appeal of the Office for 
Harmonization in the Internal Market (Trademarks and Designs) 
• Commission Regulation (EC) No. 355/2009 of 31 March 2009 
amending Regulation (EC) No. 2869/95 on the fees payable to 
the Office for Harmonization in the Internal Market (Trademarks 
and Designs) and Regulation (EC) No. 2868/95 implementing 
Council Regulation (EC) No. 40/94 on the Community 
trademark 
• National laws of EU member St ates on trademarks: national 
trademark systems exist in parallel to the Community 
trademark system  IP/N/1/EEC/T/2 
 
 
 
IP/N/1/EU/T/1 
 
IP/N/1/EU/T/2 
IP/N/1/EU/T/3 
 
 
IP/N/1/EEC/T/4 
 WT/TPR/S/317 • European Union 
 
- 205 - 
 
  Intellectual 
property right Legislative measure Notification to Council 
for TRIPS pursuant to 
Article 63.2 TRIPS 
Geographical 
indications • Wines: Regulation (EU) No 1308/2013 of the EP and of the 
Council of 17 December 2013 establishing a common 
organization of the markets in agricultural products 
• Commission Regulation (EC) No. 607/2009 of 14 July 2009, 
laying down certain detailed rules regarding protected designations of origin and geographical indications, traditional terms, labelling and presentation of certain wine sector products 
• Spirits: Regulation (EC) No. 110/2008 of the EP and of the 
Council of 15 January 2008 on the definition, description, 
presentation, labelling and the protection of geographical 
indications of spirit drinks 
• Agricultural products and foodstuffs: Council Regulation (EU) 
No. 1151/2012 of 21 November 2012 on quality schemes for 
agricultural products and foodstuffs 
• For the protection as collective trademarks, see Regulation (EC) 
No. 207/2009 of 26 February 2009 on the Community trademark 
• National laws of the EU member States, and the Appellation 
System of certain EU member States  Not notified 
 IP/N/1/EEC/4 and IP/N/1/EEC/G/5   IP/N/1/EEC/4 and IP/N/1/EEC/G/6   
IP/N/1/EU/G/3 
 IP/N/1/EU/T/2   
Industrial 
designs • Directive 98/71/EC of 13 October 1998 on the legal protection 
of designs 
• Council Regulation (EC) No. 6/2002 of 12 December 2001 on 
Community designs, as amended by Council Regulation (EC) 
No. 1891/2006 of 18 December 2006 
• Commission Regulation (EC) No 2245/2002 of 21 October 2002 
implementing Council Regulation (EC) No. 6/2002, as amended 
by Commission Regulation (EC) No 876/2007 of 24 July 2007 
• Commission Regulation (EC) No 2246/2002 of 16 December 
2002 on the fees payable to the Office for Harmonization in the 
Internal Market (Trademarks and Designs) in respect of the 
registration of Community designs, as amended by Commission 
Regulation (EC) No. 877/2007 of 24 July 2007 
• Council Decision 2006/954/EC of 18 December 2006 approving 
the accession of the EC to the Geneva Act of the Hague 
Agreement concerning the international registration of 
industrial designs, adopted in Geneva on 2 July 1999 
• National laws of EU member States:  national industrial design 
systems exist in parallel with the Community design system  IP/N/1/EU/D/1 
IP/N/1/EU/D/2 
 
IP/N/1/EU/D/3 
 
 
IP/N/1/EU/D/4 
 
 
 
IP/N/1/EU/D/5 
Patents • Regulation (EU) No. 1257/2012 of 17 December 2012 
implementing enhanced cooperation in the area of the creation of unitary patent protection 
• Regulation (EU) No. 1260/2012 of 17 December 2012 
implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements  
• Directive 98/44/EC of 6 July 1998 on the legal protection of 
biotechnological inventions  
• Regulation (EC) No. 1901/2006 of 12 December 2006 on 
medicinal products for paediatric use and amending Regulation (EEC) No. 1768/92, Directive 2001/20/EC, Directive 2001/83/EC and Regulation (EC) No. 726/2004 
• Regulation (EC) No. 816/2006 of 17 May 2006 on compulsory 
licensing of patents relating to the manufacture of pharmaceutical products for export to countries with public health problems 
• National patent laws of the EU member States and the 
European Patent Convention (EPC) exist alongside and in 
parallel with the European patent system  IP/N/1/EU/P/1 
 IP/N/1/EU/P/8   IP/N/1/EEC/P/4 IP/N/1/EU/P/2 
 
 IP/N/1/EEC/P/5  
Supplementary 
protection 
certificates • Regulation (EC) No 469/2009 of 6 May 2009 concerning the 
supplementary protection certificate for medicinal products 
• Regulation (EC) No 1610/96 of 23 July 1996 concerning the 
creation of a supplementary protection certificate for plant 
protection products  IP/N/1/EU/P/3 
 
IP/N/1/EU/P/4 WT/TPR/S/317 • European Union 
 
- 206 - 
 
  Intellectual 
property right Legislative measure Notification to Council 
for TRIPS pursuant to 
Article 63.2 TRIPS 
Plant varieties • Council Regulation (EC) No. 2100/94 of 27 July 1994, as 
amended by Council Regulation (EC) No. 15/2008 
• Commission Regulation (EC) No. 874/2009 of 17 September 
2009, establishing implementing rules for the application of Council Regulation (EC) No. 2100/94 as regards proceedings before the Community Plant Variety Office  
• Commission Regulation (EC) No. 1238/95 of 31 may 1995 
establishing implementing rules for the application of Council Regulation (EC) No. 2100/94 as regards the fees payable to the Community Plant Variety Office, as amended by Commission 
Regulation (EC) No. 572/2008 of 19 June 2008 and Commission 
Implementing Regulation (EU) No. 510/2012 of 15 June 2012 
• Commission Regulation (EC) No. 1768/95 of 24 July 1995, 
establishing implementing rules on the agricultural exemption provided for in Article 14(3) of Council Regulation (EC) No. 2100/94, as amended by Commission Regulation (EC) No. 2605/98 of 3 December 1998 
• National laws of EU member States: national systems work in 
parallel with the Community system  IP/N/1/EEC/P/3 
 IP/N/1/EU/P/5   IP/N/1/EU/P/6     
IP/N/1/EU/P/7  
Protection of 
layout designs • Council Directive 87/54/EEC of 16 December 1986 on the legal 
protection of topographies of semiconductor products  
• Council Decision 94/824/EC of 22 December 1994 on the 
extension of the legal protection  of semiconductor products to 
persons from a Member of the WTO  IP/N/1/EEC/1/Rev.1 and 
IP/N/1/EEC/L/1 
IP/N/1/EEC/1/Rev.1 and 
IP/N/1/EEC/L/2 
Undisclosed 
information and clinical trial data • Directive 2001/83/EC of 6 November 2001 on the Community 
code relating to medicinal products for human use, as amended by Directive 2004/27/EC of 31 March 2004 
• Regulation No. 726/2004 of the EP and of the Council of 31 
March 2004 laying down Community procedures for the authorization and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency 
• National laws of the EU member States  IP/N/1/EU/U/1 
 IP/N/1/EU/U/2  
Enforcement 
 • Directive 2004/48/EC of 29 April 2004 on the enforcement of 
IPRs 
• Regulation (EU) No 608/2013 of the EP and of the Council of 12 
June 2013 concerning customs enforcement of IPRs 
• National laws of EU member States  IP/N/1/EEC/2 and 
IP/N/1/EEC/E/4 
IP/N/1/EU/E/1 
Source:  WTO Secretariat. 
  
  WT/TPR/S/317 • European Union
 
- 207 - Table A3.6 Term of protection of ma jor intellectual property rights, 2015 
Type of rights Term of protection Competent agency at 
the EU level 
Copyright   
• Authors' right • Life of the author plus 70 years irrespective of the date the work was lawfully 
made available to the public. In the case of joint authorship the term should be 
calculated after the death of the last surviving author. In the case of anonymous 
or pseudonymous works, 70 years after the work is lawfully made available to the 
public. If the pseudonym does not leave any doubt as to the identity of the 
author, then protection is for the life of the author plus 70 years irrespective of 
the date the work was lawfully made available to the public Copyright is protected 
without registration 
• Work published in volumes • Protection runs from the time the work was lawfully made available to the public 
• Works that have not been lawfully 
made available to the public 
within 70 years from their 
creation • Protection should be terminated 
• Cinematographic or audiovisual 
worksa • Protection expires 70 years after the death of the author 
• Performers • Protection expires 50 years after the date of the performance. However, if a 
fixation of the performance is lawfully published or lawfully communicated to the 
public within this period, the rights expire  70 years from the date of the first such 
publication or the first such communication to the public, whichever is the earlier 
• Producers of phonograms • Protection expires 50  years after the fixation is made. However, if the phonogram 
has been lawfully published within this period, the rights expire 70 years from the 
date of the first lawful publication. If no lawful publication has taken place, and 
the phonogram has been lawfully communicated to the public within this period, 
the rights will expire 70 years from the date of the first lawful communication to 
the public 
• Producers of a filmb • Protection expires 50 years after the fixation is made. However, if the film is 
lawfully published or lawfully communicated to the public during this period, the 
rights will expire 50 years from the date of the first such publication or the first 
such communication to the public, whichever is the earlier 
• Broadcasting organizations • Protection expires 50 years after the first transmission of a broadcast whether 
transmitted by wire or over the air, including by cable or satellite  
  WT/TPR/S/317 • European Union
 
- 208 - Type of rights Term of protection Competent agency at 
the EU level 
• Photographsc • Life of the author plus 70 years no matter when it was lawfully made available to 
the public. In the case of joint authorship, the term should be calculated after the 
death of the last author. In the case of anonymous or pseudonymous works, 
70 years after the work is lawfully made available to the public. If the pseudonym 
does not leave any doubt as to the identity of the author then protection is for 
the life of the author plus 70 years no matter when the work was lawfully made 
available to the public 
Patents    
Any inventions, in all fields of 
technology, that are new, involve an 
inventive step, and are susceptible of 
industrial application 20 years from the date of filing; under a supplementary protection certificate, an 
additional period of market exclusivity of up  to five years may be granted for medicinal 
and plant protection products; an extension of another six months is available under 
paediatric legislation European Patent Office 
(EPO) for European 
patent and unitary 
patents 
Plant varieties    
Plant varieties which are distinct, 
uniform, stable, and new Plant varieties for 25 years, wine and tree species for 30 years. Protection may be 
extended for 5 years Community Plant 
Variety Office (CPVO)  
Trademarks    
Any signs represented graphically, 
particularly words, including personal 
names, designs, letters, numerals, the 
shape of goods or their packaging, 
provided that such signs are capable of 
distinguishing the goods or services of 
one undertaking from those of other 
undertakings 10 years from the date of filling of application, may be renewed for an indefinite 
number of 10-year periods Office for Harmonization 
in the Internal Market 
(OHIM) for Community 
trademarks 
Geographical indications    
Indications which identify a good as 
originating in the territory of a Member 
or a region or locality in that territory, 
where a given quality, reputation or 
other characteristics of the good are 
essentially attributable to its 
geographical origin For GIs protected as Community collective trademarks: 10 years from the date of filling 
of application, may be renewed for an inde finite number of 10 ye ar periods. For GIs 
protected as PDO/PGI, the term of protection is indefinite, unless the geographical 
indication ceases to be protected European Commission 
DG Agriculture and DG 
Trade. OHIM for 
Community collective 
trademarks  
  WT/TPR/S/317 • European Union
 
- 209 - Type of rights Term of protection Competent agency at 
the EU level 
Industrial designs    
Designs that are new and have 
individual character. A design is 
considered new if no identical design 
(i.e. one whose features differ only in 
immaterial details) has been made 
available to the public. It has individual 
character if the overall impression it 
produces on the informed user differs 
from the overall impression produced on 
such a user by any design which has 
been made available to the public Registered design: one or more periods of 5 years, up to a maximum of 25 years from 
the date of filing. Unregistered design: 3 years after publication OHIM for Community 
designs 
Undisclosed test or other data    
Data the origination of which involves 
considerable effort and which must be 
submitted to regulatory authorities in 
order to obtain marketing approval of 
pharmaceutical or of agricultural 
chemical products which utilize new 
chemical entities  8-11 years of data and marketing protection European Medicines 
Agency (EMA) grants 
marketing authorization 
a The principal director of a cinematographi c or audiovisual work is considered the au thor or one of its authors. Member States  are free to designate other co-authors. 
Irrespective of whether these pe rsons are designated as co-autho rs, the term of protection expires after the death of the last of the following persons to survive: the 
principal director, the author of the screenplay, the author of the dialogue and the composer of music specifically created for  use in the cinematographic or audiovisual 
work. 
b The term "film" designates a cinematographic or audiovisual work or moving  images, whether or no t accompanied by sound. 
c Photographs are protected under Community law only if they ar e the author's own intellectual creation. Member States may prov ide protection for other photographs. 
Source: WTO Secretariat. 
 
  
  WT/TPR/S/317 • European Union
 
- 210 - Table A4.1 Implementation of direct payments in the EU in 2015 
Member 
State/region National 
envelope
2015a Transfer 
to 
Pillar II 
2015 Transfer 
to 
Pillar I 
2015 Basic 
payments
2015b Degressivity Internal convergence Greening Young 
farmers' 
schemeRedistributive 
payment Voluntary 
coupled 
supportc Natural 
constraints
support Small 
farmer 
scheme 
 € million % of 
envelope % of 
envelope % of 
envelope % of 
envelope % of 
envelope% of envelope % of 
envelope % of 
envelope  
General rules  Over €150,000 
subject to minimum 
reduction of 5% 
 
If redistributive 
applied (> 5%), no 
need to reduce 
payments Flat rate 2015 (BPS or 
SAPS) 
 
Alternatives: 
1) flat rate 2019 
2) by 2019 no 
entitlement should be 
less than 60% of region 
average 
3) same as 2) but losses 
of value limited to 30% 30% 
mandatory Up to 2% Up to 30% Up to 8% (+ 
2% for 
protein crops) 
or more with 
Commission 
approval  up to 5%
    
Belgium 524 - - 42.11% €150,000, reduction 
of 100% (only 
Flanders) Alternative 3 30% 1.89% 9.34% (only 
applicable in 
Wallonia) 16.66% - No 
Bulgaria 721 - - 47.46% €150,000, reduction 
of 5%; €300,000, 
reduction of 100% Flat rate 2015 (SAPS) 30% 0.47% 7.07% 15.00% - Yes 
Czech 
Republic 870 - - 54.80% €150,000, reduction 
of 5% Flat rate 2015 (SAPS) 30% 0.20% - 15.00% - No 
Denmark - - 64.90% €150,000, reduction 
of 5% Alternative 2 30% 2.00% - 2.77% 0.33% No 
Germany 4,913 - - 62.00% - Flat rate 2015 (BPS) 30% 1.0% 7.00% - - Yes 
Estonia 114 - - 65.47% €150,000, reduction 
of 5% Flat rate 2015 (SAPS) 30% 0.30% - 4.23% - Yes 
Ireland 1,215 - - 68.00% €150,000 , reduction 
of 100% Alternative 2 30% 2.00% - - - No 
Greece 2,110 - - 60.63% €150,000, reduction 
of 100% Alternative 3 30% 2.00% - 7.37% - Yes 
Spain 4,902 - - 55.92% €150,000, reduction 
of 5% Alternative 3 30% 2.00% - 12.01% - Yes 
France 7,302 3.00% - 48.99% - Alternative 3 30% 1.00% 5.01% 15.00% - No 
Croatia 183 - 15.0% 43.00% - Alternative 2 30% 2.00% 10.00% 15.00% - Yes 
Italy 3,897 - - 58.00% €150,000, reduction 
of 5%, €500,000, reduction of 100% Alternative 3 30% 1.00% - 11.00% - Yes 
Cyprus 51 - - 61.12% €150,000, reduction Flat rate 2015 (SAPS) 30% 1.00% - 7.88% - No  
  WT/TPR/S/317 • European Union
 
- 211 - Member 
State/region National 
envelope
2015a Transfer 
to 
Pillar II 
2015 Transfer 
to 
Pillar I 
2015 Basic 
payments
2015b Degressivity Internal convergence Greening Young 
farmers' 
schemeRedistributive 
payment Voluntary 
coupled 
supportc Natural 
constraints
support Small 
farmer 
scheme 
of 5%
Latvia 181 7.5% - 54.30% €150,000, reduction 
of 5% Flat rate 2015 (SAPS) 30% 1.50% - 14.20% - Yes 
Lithuania 418 - - 38.25% - Flat rate 2015 (SAPS) 30% 1.75% 15.00% 15.00% - No 
Luxembourg 34 - - 68.02% €150,000, reduction 
of 5% Alternative 2 30% 1.50% - 0.48% - No 
Hungary 1,277 - - 54.80% €150,000, reduction 
of 5%, €176,000, 
reduction of 100% Flat rate 2015 (SAPS) 30% 0.20% - 15.00% - Yes 
Malta 5 - - 12.36% €150,000, reduction 
of 5% Flat rate 2015 (BPS) 30% 0.40% - 57.24% - Yes 
Netherlands 749 - - 67.53% €150,000, reduction 
of 5% Alternative 1 30% 2.00% - 0.47% - No 
Austria 693 - - 65.90% €150,000, reduction 
of 100% Alternative 1 30% 2.00% - 2.10% - Yes 
Poland 3359 - 25.0% 45.70% €150,000, reduction 
of 100% Flat rate 2015 (SAPS) 30% 1.00% 8.30% 15.00% - Yes 
Portugal 566 - - 47.23% €150,000, reduction 
of 5% Alternative 3 30% 2.00% - 20.77% - Yes 
Romania 1,600 - - 50.74% - Flat rate 2015 (SAPS) 30% 1.79% 5.18% 12.28% - Yes 
Slovenia 138 - - 54.00% €150,000, reduction 
of 5% Alternative 3 30% 1.00% - 15.00% - Yes 
Slovakia 436 - 21.3% 56.45% €150,000, reduction 
of 5% Flat rate 2015 (SAPS) 30% 0.55% - 13.00% - No 
Finland 523 - - 49.00% €150,000, reduction 
of 5% Alternative 1 30% 1.00% - 20.00% - No 
Sweden 697 - - 55.00% €150,000, reduction 
of 5% Alternative 2 30% 2.00% - 13.00% - No 
U.K. 3,170 10.8% - 66.63% 30% 1.71% - 1.66% - No 
England   €150,000, reduction 
of 5% Flat rate 2015 (BPS)  
Scotland   €150,000, reduction 
of 5%, €600,000, reduction of 100% Alternative 1  
Wales   €150,000, reduction 
of 15%, €200,000, 
reduction of 30%, 
€250,000, reduction 
of 55%, €300,000, 
reduction of 100% Alternative 1  
Northern 
Ireland   €150,000, reduction 
of 100% Alternative 2  
 
a According to Annex III of Regulation (E U) No. 1378/2014 (see footnote Table 4.5). 
b Applicable only on the amounts of basic payment (BPS or SAPS). c See Table A4.2 member States and sectors supported.  Source: European Commission (based on prel iminary data, subject to verification).   
  WT/TPR/S/317 • European Union
 
- 212 - Table A4.2 Voluntary coupled support – member States and sectors supported (claim year 2015) 
Sector 
Belgium 
(Flanders ) 
Belgium 
(Wallonia ) 
Bulgaria 
Czech 
Republic 
Denmark 
Estonia 
Ireland 
Greece 
Spain 
France 
Croatia 
Italy 
Cyprus 
Latvia 
Lithuania 
Luxembourg 
Hungary 
Malta 
Netherlands 
Austria 
Poland 
Portugal 
Romania 
Slovenia 
Slovakia 
Finland 
Sweden 
U.K. 
Beef and veal √ √ √ √ √ √   √ √ √ √ √   √ √   √ √ √ √ √ √ √ √ √ √ √ √  
Cereals               √   √    √   √                   √   √     
Flax                                         √               
Fruit and vegetables     √ √   √   √ √ √ √ √ √ √ √   √ √     √ √ √ √ √ √     
Grain legumes               √ √      √                     √           
Hemp                   √                     √   √           
Hops       √           √                      √   √   √       
Milk and milk products   √ √ √   √     √ √ √ √ √ √ √   √ √     √ √ √  √ √ √     
Nuts                 √                                       
Oilseeds                        √   √                             
Olive oil                       √                                 
Protein crops     √ √     √ √ √ √ √  √   √ √ √ √       √   √ √   √     
Rice               √ √     √         √         √ √           
Seeds               √   √       √                 √           
Sheep meat and goat 
meat   √ √ √   √   √ √ √ √ √ √ √ √   √ √ √ √ √ √ √   √ √   √  
Silkworms               √                             √           
Starch potato       √           √       √             √         √     
Sugar beet       √       √ √   √ √         √       √   √   √ √     
 
Source: European  Commission. 
__________