Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EC, Euratom) n° 58/97 concerning structural business statistics

(presented by the Commission)

EXPLANATORY MEMORANDUM

Council Regulation (EC, Euratom) No 58/97 concerning structural business statistics (SBS Regulation) is the main legal framework for the collection, compilation, transmission and evaluation of statistics on the structure, activity, competitiveness and performance of business. The proposed Regulation aims to complement the SBS Regulation with two additional sector specific annexes on credit institutions (Annex 6) and pension funds (Annex 7). Moreover, it will extend the coverage of the horizontal module (Annex 1) to the following activities that are not yet included: other financial intermediation services, pension funds and financial auxiliaries. Finally, it introduces two additional variables in the area of environment to Annex 2 of the SBS Regulation (on industry activities).

The additional structural business statistics on credit institutions, pension funds and other financial services are needed for the assessment of the single financial market, backup of macro-economic statistics and observation of the stability of the financial system in the EU. The Financial Services Action plan launched by the Commission in May 1999 emphasises the fundamental importance of an effective single financial market.

Data on environmental costs and expenditures are indispensable for evaluating the costs of complying with environmental regulations. Comprehensive, harmonised and up-to-date environmental expenditures data for the EU would improve the design and implementation of environmental regulation and help achieving high levels of protection of the environment at lower costs.

Article 2 of the SBS Regulation states that one purpose for compiling structural business statistics is to analyse specific characteristics of enterprises related to particular groupings of activities. Article 4 allows the attachment of annexes in which the statistics to be compiled are grouped as modules. The activities of credit institutions and pension funds were considered sufficiently mature to merit addition of a sector specific annex. Annexes 6 and 7 contain a list of characteristics giving the best possible overview of the activities of credit institutions and pension funds, respectively. The data will make it possible to examine structural changes, such as those resulting from introduction of the Euro, consolidation of credit institutions and other forces shaping the industry, the development of the pension fund industry as well as the diversity of pension funds currently operating in the EU. The choice of characteristics is based on voluntary collections of data on credit institutions and pension funds launched with the reference year 1997, as well as the pilot action on pension funds.

Including the other financial intermediation activities (covered by the NACE Rev.1 group 65.2), pension fund activities (covered by the NACE Rev.1 class 66.02) and financial auxiliaries (covered by NACE Rev.1 division 67) in Annex 1 of the SBS Regulation means that the limited number of main structural statistics will also be collected for those activities. These data will complement the statistics already available for a wide range of other economic activities (from industry activities up to business services). The decision to include these activities in Annex 1 is based on the results of pilot actions on other financial intermediation, pension funds and financial auxiliaries. In order to meet Member States' concerns, it is proposed to decide the first obligatory reference year as well as the transmission delay of these variables via the Comitology procedure set forth in Article 13 of the SBS Regulation.

The additional business statistics on financial services of annex 6 and annex 7 are largely based on administrative sources. This means that normally the additional burden on enterprises and national data providers (National Statistical Offices, National Central Banks, National Supervisory Authorities, ...) caused by collection of these statistics is limited or non-existent. The collection and compilation of statistics on annex 1 variables for other financial intermediation activities and financial auxiliaries may result in additional costs. However, in accordance with Article 6 of the SBS Regulation, the draft Regulation does not define the actual data collection methods to be used. Accordingly, each Member State may compile the data in the manner that is most appropriate to its own situation.

Two variables describing the amount of money devoted for environmental protection expenditure are proposed for obligatory inclusion in Annex 2 of the SBS Regulation (on industry activities): i.e. Investment in integrated technologies and Total current expenditure for environmental protection. The pilot studies carried out on these variables proved the feasibility to collect this data. These types of environment protection expenditures are very important in terms of overall expenditure and it is predicted that the importance will increase over time compared to investments in end-of-pipe equipment which is the only obligatory variable at the moment. Therefore, it is essential for the users of environment expenditure data to have information on all three variables.

The proposal regarding structural business statistics for financial services is the fruit of numerous consultations and meetings with Member States, a large majority of which support it. The proposal concerning the environmental variables is the result of intense discussions with experts in the Member States and in different Working Groups. The members of these Committees and Working Groups generally supported the proposed Regulation.

The proposed Regulation is submitted to the European Parliament and the Council for their consideration.

2001/0023 (COD)

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EC, Euratom) n° 58/97 concerning structural business statistics

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 285 thereof,

Having regard to the proposal from the Commission [1],

[1] OJ

Having regard to the opinion of the Economic and Social Committee [2],

[2] OJ

Having regard to the opinion of the European Central Bank [3],

[3] OJ

Acting in accordance with the procedure laid down in Article 251 of the Treaty,

Whereas:

(1) Council Regulation (EC, Euratom) No 58/97 [4] as last amended by Council Regulation (EC, Euratom) 410/98 [5] established a common framework for the collection, compilation, transmission and evaluation of Community statistics on the structure, activity, competitiveness and performance of businesses in the Community;

[4] OJ L 14, 17.1.1997, p.1.

[5] OJ L 52, 21.2.1998, p.1.

(2) Developments in Community monetary, economic and social integration require the extension of the aforesaid framework to credit institutions, pension funds, other financial intermediation and activities auxiliary to financial intermediation;

(3) The development and operation of the internal market increase the need for information measuring its effectiveness, in particular in the sectors of credit institutions, pension funds, other financial intermediation and activities auxiliary to financial intermediation;

(4) The liberalisation process of international trade in financial services necessitates business statistics in the financial services area to support the trade negotiations;

(5) The compilation of national and regional accounts according to Council Regulation (EC) No 2223/96 [6] of 25 of June 1996 on the European system of national and regional accounts in the Community requires comparable, complete and reliable business statistics in the financial services area;

[6] OJ L 310, 30.11.1996, p.1.

(6) The introduction of the single currency will have a major impact on the structure of the financial services industry and the cross-border flows of capital, which stresses the importance of information on competitiveness and internationalisation;

(7) The smooth conduct of policies pursued by the competent authorities relating to prudential supervision of credit institutions and the stability of the financial system implies the need for additional information on credit institutions and related services;

(8) A developing pension funds sector could help to boost the capital markets in taking increasingly advantage of the liberalisation of investment rules;

(9) Decision 2179/98/EC of the European Parliament and of the Council on the review of the European Community programme of policy action in relation to the environment and sustainable development "Towards sustainability" [7] reiterated the need for reliable and comparable data, statistics and indicators as a key tool for the evaluation of the cost of compliance with environmental regulations;

[7] OJ L 275, 10.10.1998, p.1.

(10) The Statistical Programme Committee set up by Decision 89/382/EEC, Euratom [8], the Banking Advisory Committee set up by Directive 77/780/EEC [9], the Committee on Monetary, Financial and Balance of Payments Statistics set up by Decision 91/115/EEC [10] and the Insurance Committee set up by Directive 91/675/EEC [11] have been consulted,

[8] OJ L 181, 28.6.1989, p.47.

[9] OJ L 322, 17.12.1977, p.30.

[10] OJ L 59, 6.3.1991, p.19.

[11] OJ L 374, 31.12.1991, p.32.

HAVE ADOPTED THIS REGULATION:

Article 1

Regulation (EC, Euratom) No 58/97 shall hereby be amended as follows:

1. In Article 5 the following indents shall be added:

« ... a detailed module for structural statistics on credit institutions defined in Annex 6, »

« ... a detailed module for structural statistics on pension funds defined in Annex 7. »

2. Annexes 6 and 7, as set out in the Annex to this Regulation, shall be added.

Article 2

Annex 1 of Regulation (EC, Euratom) No 58/97 shall be amended as follows:

1. In section 5 the following sentence shall be added:

"However the first reference year for which statistics on the activity classes covered by the NACE Rev. 1 group 65.2 and division 67 are to be compiled, shall be decided in accordance with the procedure laid down in Article 13 of this Regulation."

2. Section 8 shall be replaced by the following:

"1. The results are to be transmitted within 18 months of the end of the calendar year of the reference period, except for the NACE Rev. 1 activity class 65.11 and the activities of NACE Rev. 1 covered by the annexes 5, 6 and 7. For the NACE activity class 65.11 the transmission delay is 10 months. For the activities covered by the annexes 5, 6 and 7 the transmission delay is laid down in these annexes. However the transmission delay of the results on the activity classes covered by the NACE Rev. 1 group 65.2 and division 67 shall be decided in accordance with the procedure laid down in Article 13 of this Regulation.

2. Except for the divisions 65 and 66 of NACE Rev. 1, preliminary national results or estimates are transmitted within 10 months of the end of the calendar year of the reference period for the enterprise statistics compiled for the characteristics listed below:

12 110 (turnover) 16 110 (number of persons employed)

These preliminary results are to be broken down to NACE Rev. 1 3-digit level (group), except for Sections H, I and K of NACE Rev. 1, for which they are to be broken down according to the groupings laid down in Section 9. For the division 67 of NACE Rev. 1, the transmission of preliminary results or estimates shall be decided in accordance with the procedure laid down in Article 13 of this Regulation."

3. In section 9, Section J shall be replaced by the following:

"SECTION J Financial intermediation

To enable Community statistics to be compiled, Member States will transmit component national results broken down to the classes of NACE Rev. 1."

4. In section 10 paragraph 1 the first sentence shall be replaced by the following:

"Member States will provide the Commission with a report relating to the definition, structure and availability of information on statistical units which are classified under Sections M to O of NACE Rev. 1. "

Article 3

Annex 2 of the Regulation (EC, Euratom) No 58/97 shall be amended as follows:

1. In section 4, paragraph 3 the following characteristic shall be inserted after the variable 21 11 0 (investment in equipment and plant for pollution control, and special anti-pollution accessories - mainly end-of-pipe equipment):

"21 12 0 - Investment in equipment and plant linked to cleaner technology ("integrated technology") (()"

2. The footnote in section 4, paragraph 3 shall be replaced by the following:

"(() If the total amount of the turnover or the number of persons employed in a division of NACE Rev. 1 Sections C to E represent, in a Member State, less than 1% of the Community total, the information necessary for the compilation of statistics relating to characteristics 21 11 0, 21 12 0, 22 11 0 and 22 12 0 need not be collected for the purposes of this Regulation. If necessary for Community policy requirements, the Commission may, in accordance with the procedure laid down in Article 13 of this Regulation, request ad hoc collection of this data."

3. In section 4, paragraph 4 the following characteristic shall be inserted after the variable 20 31 0 (Purchases of electricity (in value)):

"21 14 0 - Total current expenditure on environmental protection (() "

4. To section 4, paragraph 4 the following footnote shall be added:

"(() If the total amount of the turnover or the number of persons employed in a division of NACE Rev. 1 Sections C to E represent, in a Member State, less than 1% of the Community total, the information necessary for the compilation of statistics relating to characteristic 21 14 0 need not be collected for the purposes of the Regulation. If necessary for Community policy requirements, the Commission may, in accordance with the procedure laid down in Article 13 of this Regulation, request ad hoc collection of this data."

5. In section 5 the following two paragraphs shall be added:

"3. The first reference year for which statistics on the characteristics 21 12 0 and 21 14 0 are to be compiled is the calendar year 2001.

4. The characteristic 21 12 0 shall be compiled yearly. The characteristic 21 14 0 shall be compiled every three years."

6. In section 7, paragraph 6 shall be replaced by the following:

"6. The results for the characteristics 21 11 0, 21 12 0 and 21 14 0, are to be broken down to the NACE Rev. 1 2-digit level (division) in Section C, D and E and to the NACE Rev. 1 3-digit level (group) for the divisions 21, 23 and 24. "

7. In section 7, the following paragraph shall be added:

"7. The results for the characteristics 21 11 0, 21 12 0 and 21 14 0, are to be broken down to the following environmental domains: Protection of ambient air and climate, Wastewater management, Waste management and Other environmental protection activities. Other environmental protection activities includes the environmental domains Protection of soil and groundwater, Noise and vibration abatement, Biodiversity and landscape, Radiation, Research and Development, General administration of the environment and indivisible expenditure. The results for the environmental domains shall be broken down to NACE Rev.1 2-digit level (division)."

8. In section 9, the following characteristic shall be added:

"21 11 0 - Investment in equipment and plant for pollution control, and special anti-pollution accessories (mainly end-of-pipe equipment)"

The following comment shall be added for the variables 21 11 0, 21 12 0 and 21 14 0:

"Only specific breakdown on the environmental domains Biodiversity and Landscape, Soil and Groundwater".

9. In section 10, the following shall be added:

"For the compilation of statistics on the characteristics 21 12 0 and 21 14 0 this transition period may be extended by a further three years in accordance with the procedure laid down in Article 13 of this Regulation."

Article 4

This Regulation shall enter into force on the 20th day following that of its publication in the Official Journal of the European Communities.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the European Parliament For the Council

The President The President

ANNEX 6

A DETAILED MODULE FOR

STRUCTURAL STATISTICS ON CREDIT INSTITUTIONS

Section 1

Aims

The aim of this Annex is to establish a common framework for the collection, compilation, transmission and evaluation of Community statistics on the structure, activity, performance and competitiveness of the sector of credit institutions. This module includes a detailed list of characteristics on which statistics shall be compiled in order to improve knowledge on the national, Community and international development of the sector of credit institutions.

Section 2

Scope

The statistics to be compiled shall relate to the domains referred to in points (i), (ii) and (iii) of Article 2 of this Regulation, and in particular to:

1. the detailed analysis of the structure, activity, performance and competitiveness of credit institutions;

2. the development and distribution of total business and business per product, international activities, employment, capital and reserves, and other assets and liabilities.

Section 3

Coverage

1. The statistics shall be compiled for the activities of credit institutions within the scope of NACE Rev. 1 classes 65.12 and 65.22.

2. The statistics shall be compiled for the activities of all credit institutions referred to in Article 2 (1) (a) and Article 2 (2) of Council Directive 86/635/EEC [12] (with the exemption of central banks).

[12] OJ L 372, 31.12.1986, p.1.

3. Branches of credit institutions referred to in Article 24 of Directive 2000/12/EC of the European Parliament and of the Council [13] of 20 March 2000, whose activity falls within one of the NACE Rev. 1 classes referred to in paragraph 1, shall be assimilated to the credit institutions specified in paragraph 2.

[13] OJ L 126, 25.5.2000, p. 1

Section 4

Characteristics

The characteristics and statistics to be compiled are listed below. The characteristics and statistics in italics are also included in the common module lists of Annex 1. When characteristics are derived directly from the annual accounts, accounting years ending within a reference year shall be assimilated to the said reference year.

The list of characteristics includes the following information:

(i) characteristics listed in Article 4 of Directive 86/635/EEC: asset side of the balance sheet: item 4; liability side of the balance sheet: items 2 (a) + 2 (b) as an aggregate, items 7 + 8 + 9 + 10 + 11 + 12 + 13 + 14 as an aggregate.

(ii) characteristics listed in Article 27 of Directive 86/635/EEC: item 2, items 3 (a) + 3 (b) + 3 (c) as an aggregate, item 3 (a), item 4, item 5, item 6, item 7, items 8 (a) + 8 (b) as an aggregate, item 8 (b), item 10, items 11 + 12 as an aggregate, items 9 + 13 + 14 as an aggregate, item 15 + 16 as an aggregate, item 19, items 15 + 20 + 22 as an aggregate, item 23.

(iii) additional characteristics listed below:

>TABLE POSITION>

(iv) characteristics for which yearly regional statistics are to be compiled:

>TABLE POSITION>

Section 5

First reference year

The first reference year for which annual statistics shall be compiled for the characteristics listed in Section 4 is the calendar year 2001.

Section 6

Production of results

1. The results are to be broken down to the following NACE Rev. 1 classes: 65.12 and 65.22 separately.

2. The results of the regional statistics are to be broken down to NACE Rev. 1 4-digit level (classes) and level 2 of the nomenclature of territorial units (NUTS).

Section 7

Transmission of results

The transmission delay of the results shall be decided in accordance with the procedure laid down in Article 13 of this Regulation. It shall not be longer than 10 months from the end of the reference year.

Section 8

Committee for Monetary, Financial and Balance of Payments Statistics

The Commission shall inform the Committee for Monetary, Financial and Balance of Payments Statistics about the implementation of this module and about all measures for adjustment to economic and technical developments concerning the collection and statistical processing of data, the processing and the transmission of results.

Section 9

Pilot studies

For the activities covered by this annex, the Commission will institute the following pilot studies to be carried out by Member States:

- information on derivatives and off-balance sheet items,

- information on the distribution networks,

- information needed for the decomposition of the transactions of credit institutions according to prices and volumes.

The pilot studies shall be carried out in order to assess the relevance and feasibility of obtaining data, taking into account the benefits of the availability of the data in relation to the cost of collection and the burden on business.

Section 10

Transitional period

For the purposes of this detailed module, the transition period shall not exceed three years from the beginning of the first reference year for the compilation of the statistics indicated in Section 5.

ANNEX 7

A DETAILED MODULE

FOR STRUCTURAL STATISTICS ON PENSION FUNDS

Section 1

Aims

The aim of this Annex is to establish a common framework for the collection, compilation, transmission and evaluation of Community statistics on the structure, activity, performance and competitiveness of the pension funds sector. This module includes a detailed list of characteristics on which statistics shall be compiled in order to improve knowledge of the national, Community and international development of the pension funds sector.

Section 2

Scope

The statistics to be compiled shall relate to the domains referred to in points (i), (ii) and (iii) of Article 2 of this Regulation, and in particular to:

1. the detailed analysis of the structure, activity, performance and competitiveness of pension funds,

2. the development and distribution of total business, patterns of pension funds members, international activities, employment, investments and liabilities.

Section 3

Coverage

1. The statistics are to be compiled for all activities within the scope of NACE Rev. 1 class 66.02. This class covers the activities of autonomous pension funds.

2. Some statistics are to be compiled for enterprises with non-autonomous pension funds which are carried out as ancillary activities.

Section 4

Characteristics

1. The list of characteristics and statistics set out below indicate, where relevant, the type of statistical unit for which the statistics are to be compiled. The statistics and characteristics in italics are also included in the common module lists of Annex 1. When characteristics are derived directly from the annual accounts, accounting years ending within a reference year shall be assimilated to the said reference year.

2. Demographic and enterprise characteristics for which yearly statistics are to be compiled (for autonomous pension funds only):

>TABLE POSITION>

>TABLE POSITION>

3. Enterprise characteristics for which yearly statistics are to be compiled (for enterprises with non-autonomous pension funds only):

>TABLE POSITION>

Section 5

First reference year

The first reference year for which annual statistics shall be compiled for the characteristics listed in Section 4 is the calendar year 2001.

Section 6

Production of results

1. The results for the characteristics listed in section 4 paragraph 2 are to be broken down according to the NACE Rev. 1, 4-digit level (class).

2. The results for the characteristics listed in section 4 paragraph 3 are to be broken down according to the NACE Rev. 1 section level.

Section 7

Transmission of results

The results shall be transmitted within 12 months from the end of the reference year.

Section 8

Insurance Committee

The Commission shall inform the Insurance Committee about the implementation of this module and about all such measures for adjustment to economic and technical developments concerning the collection and statistical processing of data and the processing and the transmission of results.

Section 9

Pilot studies

For the activities covered by this annex, the Commission will institute the following pilot studies to be carried out by Member States:

- the following more in-depth information on cross-border activities of pension funds:

>TABLE POSITION>

- the following additional information on non-autonomous pension funds:

>TABLE POSITION>

- information on derivatives and off-balance sheet items.

The pilot studies shall be carried out in order to assess the relevance and feasibility of obtaining data, taking into account the benefits of the availability of the data in relation to the cost of collection and the burden on business.

Section 10

Transitional period

For the purposes of this detailed module, the transition period will not exceed three years from the beginning of the first reference year for the compilation of the statistics indicated in Section 5.

FINANCIAL STATEMENT

1. Title of operation

Proposal for a Regulation of the European Parliament and the Council amending Council Regulation No 58/97 of 20 December 1996 concerning structural business statistics

2. Budget heading(s) involved

Chapter B5-60

3. Legal basis

Article 285 of the Treaty

4. Description of operation

4.1 General objective

This Council Regulation aims to make available harmonised statistical information on credit institutions, pension funds, other financial intermediation, financial auxiliaries and environment. This information is needed for drawing up, monitoring and evaluating Community policies, in particular concerning the internal market as well as economic, financial, sectoral, competition and enterprise policies. Furthermore, international treaties such as that instituting the General Agreements on Trade in Services (GATS) require harmonised statistics in this area.

4.2 Period covered and arrangements for renewal

Yearly data collection and compilation starting from the reference year 2001.

5. Classification of expenditure or revenue

5.1 Non-compulsory expenditure

5.2 Differentiated appropriations

5.3 Type of revenue involved

The sale of statistical products (databases, publications) and services partially covering production costs.

6. Type of expenditure or revenue

The contribution from the Community budget with respect to the work by the national statistical institutes or other national authorities responsible for Community statistics represents only part of the total cost of the statistical work undertaken by the national authorities. In principle production and transmission of regular statistics, which form an integral part of the statistical programme, will be based on the subsidiarity principle, and the operational and administrative costs are borne by the national authorities. Subsidy for co-financing with other sources of the public sector is possible for the Member States supporting the implementation of the action, but this possibility is low since the data to be collected are based on existing administrative sources

Work by Eurostat to develop and document the Community methodology and to process, analyse and disseminate data will be covered in full. Where necessary this work will be carried out by means of contracts for the provision of services. Additional costs are expected to be marginal.

The sale of statistics on credit institutions, pension funds, other financial intermediation and financial auxiliaries (publications, databases etc.) will lead to some revenue, which is estimated about 50.000 Euro per year.

7. Financial impact

7.1 Method of calculating total cost of operation (relation between individual and total costs)

Cost of work by national authorities:

Since the data collection for credit institutions and pension funds is largely based on existing administrative sources, minimal costs are expected for compiling these statistics. Pilot studies on the additional environmental characteristics proved the feasibility to collect them. In so far as existing data collection systems for the statistics on credit institutions, pension funds and environment have to be slightly extended or adapted, small additional costs are possible. The contribution from the Community budget is calculated on the basis of the following hypothesis: 8-10% of the operational costs for the first 4 years of operation for the statistics on credit institutions, pension funds and environmental expenditures.

In some Member States, some efforts to compile statistics on other financial intermediation and financial auxiliaries will be necessary. Since the first reference year for the data collection on other financial intermediation activities and financial auxiliaries still has to be decided following the Comitology procedure, it is difficult to give a precise timing of the expected costs of this operation.

7.2 Itemised breakdown of cost

Commitment appropriations EUR million (at current prices)

>TABLE POSITION>

7.3 Schedule of commitment and payment appropriations

EUR million

>TABLE POSITION>

8. Fraud prevention measures

For the contracts and agreements entered into by the Commission, payment is solely by results. Fraud prevention measures (requirement to provide measurable deliverables, control of deliverables) are included in all contracts or agreements entered into by the Commission.

9. Elements of cost-effectiveness analysis

9.1 Specific and quantified objectives; target population

(1) analyse specific characteristics of credit institutions and pension funds. Article 2 of the SBS Regulation sets forth that the analysis of specific characteristics of enterprises related to certain groupings of enterprises is one purpose of structural business statistics. Credit institutions and pension funds were considered to be sufficiently mature to develop two sector specific annexes to the SBS Regulation.

(2) include the activities of other financial intermediation and financial auxiliaries in the scope of Annex 1 of the SBS Regulation in order to analyse the structure and evolution of the activities of businesses active in this area. In addition to providing business statistics on a large number of financial services within the European Union, the proposed regulation should improve the availability of data used for the compilation of national accounts or other related statistics.

(3) make available harmonised statistical information on environmental expenditures within the European Union. The two additional variables on environment in certain breakdowns are necessary for drawing up, monitoring and evaluating Community policies.

The beneficiaries of this operation are all users of official statistics: the Community institutions, the governments of the Member States, economic and social decision makers, the financial industry, research institutes, universities and the media.

Information on the internal market for credit institutions, pension funds, other financial intermediaries and financial auxiliaries is needed to facilitate the proper functioning of the Single Market, to provide orientation for additional Commission actions as stated in the communication: Financial Services: Implementing the framework for financial markets: Action Plan.

Information on other financial intermediaries and financial auxiliaries will be useful for compilers of national accounts and related statistics.

Data on environmental costs and expenditures is indispensable for evaluating the costs of complying with environmental regulations. Having comprehensive, harmonised and up-to-date pollution abatement costs and expenditure data would allow to improve the design and implementation of EU environmental legislation and help achieving high levels of protection of the environment at lower costs.

Member States authorities (National Statistical Institutes, National Central Banks, ...) are responsible for the data compilation foreseen in this proposal.

9.2 Grounds for the operation

The Member States are responsible for the collection of data required in the Regulation, and operating and administration costs will be almost exclusively met by the national governments. All Member States already collect and compile statistics on credit institutions and pension funds. Therefore, and in accordance with Article 6 of the SBS Regulation, the proposed Regulation does not specify the collection methods to be used. Each Member State may compile the data in the manner that is most appropriate to its own situation. In Member States where there is currently a lack of information on other financial intermediation services, financial auxiliaries and environmental expenditures, the national data providers may choose the manner in which they will collect and compile the statistics. Nevertheless, the expenditure is essential for harmonisation of the contents and the scope of the statistics produced by Member States.

- Statistical activities in general and data collection in particular are largely governed by the principle of subsidiarity. Accordingly, a Community-level initiative is required to produce data on credit institutions, pension funds, other financial intermediation, financial auxiliaries and environment that is comparable among Member States.

- Similar efforts of Member States regarding compilation of statistics of sector specific annexes have been undertaken in the area of industry, distributive trades, construction and insurance services statistics (Regulation 58/97 + amendment Regulation 410/98). The variables of Annex 1 of the Regulation 58/97 are becoming more and more available for available for a wide range of other economic activities (from industry activities up to business services). In the framework of the Annex 2 of the SBS Regulation some environmental statistics have already been compiled.

- The potential of multiplier effects (ability to mobilise other sources of finance) is relatively limited. However, the data foreseen by the draft Regulation will be of considerable relevance for users wishing to make international comparisons within the European Union, and to countries outside the European Union. Harmonised business statistics on a European level with respect to important aspects of the financial services area are currently lacking. Filling this gap is essential, as financial services often play a very prominent role in the economy. Availability of this kind of statistics should lead to greater revenue by selling statistical products and services. Comprehensive, harmonised and up-to-date statistics on environmental expenditure will improve the design and implementation of environmental regulation and help to achieve high levels of protection of the environment at lower costs.

Difficulties may arise if the Commission and/or some Members States do not make available the necessary resources for the success of the operation. This is unlikely, since the proposal maximises the use of existing administrative sources. In some Member States some efforts to compile statistics on other financial intermediation and financial auxiliaries will be necessary.

9.3 Monitoring and evaluation of the operation

- Performance indicators selected

The statistical actions provided for by the proposed Regulation will be monitored in the context of the Community statistical programme, which is monitored by the Community Statistical Programme Committee established by Decision 89/382/EEC.

In this context Eurostat will report each year on progress, summing up for each action the main objectives and the main achievements of the year, and providing statistics on the use of human, budgetary, data-processing, technical and administrative resources during the report period.

The quality of the statistics compiled will be regularly checked on the basis of the requirements of the Commission Regulation (EC) No 1618/1999 concerning the criteria for the evaluation of quality of structural business statistics. Additional internal quality checks will be installed.

- Details and frequency of planned evaluations

Article 14 of the SBS Regulation requires the Commission to submit a report to the European Parliament and the Council concerning the experience acquired from the work carried out pursuant to the Regulation at least once every three years.

This report contains four parts:

(1) Implementation of the SBS regulation and the foreseen developments

(2) Dissemination and use of data

(3) Quality of the data (The criteria for evaluating the quality of structural business statistics are defined in the Commission Regulation (EC) No 1618/1999 of 23 July 1999)

(4) The cost for business

10. Administrative expenditure (Section III, Part A of the budget)

Actual mobilisation of the necessary administrative resources will depend on the Commission's annual decision on the allocation of resources, taking into account the number of staff and additional amounts authorised by the budgetary authority.

10.1 Effect on the number of posts

>TABLE POSITION>

10.2 Overall financial impact of additional human resources

EUR

>TABLE POSITION>

Existing human resources will be reallocated for the management and the needs of the program, no additional resources are necessary.

10.3 Increase in other administrative expenditure as a result of the operation

EUR

>TABLE POSITION>

No or only a marginal increase in other administrative expenditure is foreseen. Expenditure on working groups and missions, etc are expected to continue at the same level as required to support Council Regulation No 58/97 that will be amended by the new Regulation.

IMPACT ASSESSMENT FORM THE IMPACT OF THE PROPOSAL ON BUSINESS WITH SPECIAL REFERENCE TO SMALL AND MEDIUM-SIZED ENTERPRISES( SMEs)

Title of proposal

Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC, Euratom) n° 58/97 concerning structural business statistics

Document reference number

The proposal

The draft Regulation is designed to supplement and update Council Regulation (EC, Euratom) n° 58/97 concerning structural business statistics (SBS Regulation) with detailed modules for structural statistics on credit institutions and pension funds. It extends Annex 1 of the SBS Regulation to other financial intermediation and financial auxiliaries and it adds two characteristics on environmental expenditures to Annex 2 (on industry).

1. Taking account of the principle of subsidiarity, why is Community legislation necessary in this area and what are its main aims-

The Commission requires statistical information on the structure, activity, competitiveness and performance of the European business community, in particular for the evaluation and follow-up of the internal market. The SBS Regulation provided an instrument for co-ordinating the many different business surveys undertaken within the EU Member States. Although this Regulation covers services as well as industry, not all financial [14] services are already included, since the feasibility of the data collection on these activities still needed to be assessed.

[14] In 1998, Council Regulation 410/98 added a sector specific annex on insurance services to the SBS Regulation.

After examining the results of pilot studies on credit institutions and pension funds, these activities were considered to be sufficiently mature to collect business statistics for a more elaborate analysis and therefore, to add sector specific annexes to the SBS Regulation for each of the two activities. The additional data draw largely on existing administrative data sources in Member States.

Annex 1 of the SBS Regulation is a horizontal module with a limited number of main variables covering a wide range of economic activities (from industry activities up to business services). Other financial intermediation activities (covered by the NACE group 65.2), pension funds activities (covered by the NACE class 66.02) and activities auxiliary to financial intermediation (covered by the NACE division 67) are not yet included in this horizontal module. Since the purpose of the SBS Regulation is to create a comprehensive system of business statistics describing all industries and services, one objective of the draft Regulation is to include these activities in Annex 1 of the SBS Regulation.

Annex 2 contains a list of characteristics specifically describing industrial activities. It already includes some characteristics on environment, but they have proven themselves insufficient for Community policy purposes. Thus, the draft legislation proposes additional characteristics on environmental expenditure.

The purpose of the proposed amendments to the SBS Regulation is to make available comparable and harmonised statistics in the above mentioned areas for all EU Member States. Nevertheless, the Member States are responsible for collecting and compiling the statistics. The proposal aims at harmonising the results compiled by the Member States in terms of the coverage, definitions and classifications used. It does not seek to harmonise the data collection systems in use in each Member State. This Regulation will require that each Member State compiles results that are comparable among Member States according to their national compilation methods. In accordance with Article 6 of the SBS Regulation, the proposed Regulation does not determine the national collection methods to be used. Each Member State may compile the data in the manner most appropriate to its own situation.

The impact on business

2. Who will be affected by the proposal-

- which sectors of business

With respect to collection of harmonised statistics on credit institutions, approximately 8600 enterprises are concerned. The requirements in the credit institutions sector (NACE Rev.1 classes 65.12 and 65.22) reflect the state of development of this sector, with detailed data circuits already existing for supervisory purposes. Accordingly, the additional burden on enterprises resulting from collection of these statistics is limited or even non-existent.

With respect to collection of harmonised statistics on pension funds (NACE Rev.1 class 66.02), the choice of characteristics is based on the results of a pilot study, and draws mainly on existing administrative sources. The additional burden on pension funds should therefore be limited.

With respect to other financial intermediation (NACE Rev.1 group 65.2) and financial auxiliaries (NACE Rev.1 division 67), only a limited number of main variables must be compiled. Experience has shown that the results on the same variables are increasingly available for a wide range of activities (from industry activities to business services). Not all of the financial service activities newly covered are supervised, but the pilot studies show that in most Member States, administrative sources are sufficient for data compilation, and therefore the additional burden on enterprises will often be limited. In a few Member States, where some of the other financial intermediation activities and financial auxiliaries are not supervised, the collection of additional data could cause extra burden on certain categories of financial services enterprises concerned.

Finally, the two proposed variables in the area of environment are only compiled for enterprises active in industrial activities (NACE Rev.1 section C, D and E). Pilot studies in this area showed that the collection of these variables is feasible.

- which sizes of business (what is the concentration of small and medium-sized firms)

The Regulation determines that the results to be transmitted to the Commission (Eurostat) should be representative for enterprises of all size classes. It does not specify how this data should be compiled, leaving the responsibility to the national data collection system in each Member State. In fact, Article 6 of the SBS Regulation allows estimation procedures rather than comprehensive data collections for the very limited data that are not yet part of the existing circuits.

Since this proposal makes broad use of administrative sources for the structural business statistics on financial services, it will minimise the number of additional variables that must be collected from the businesses concerned. In fact, for some Member States, no additional data will have to be collected at all.

This regulation stipulates that information on environmental protection expenditures should cover all enterprises regardless of size, and that these data should be broken down by size classes. Surveys in the area of environmental protection expenditure generally focus on the large enterprises, as small and medium sized enterprises usually stand for a limited part of total environmental expenditure. It has been made clear in the discussions with experts in Member States that the focus is on providing good information on the more aggregated level and that the breakdown by size classes is less important for the environmental variables. The number of size classes and the span of the smallest size class facilitate for the Member States to reduce the response burden on SME. However, it is up to each Member State to choose the most appropriate method of data collection.

- are there particular geographical areas of the Community where these businesses are found

If administrative sources are used, sample surveys are not necessary. Should a Member State decide that a sample survey is needed, Article 7 of the SBS Regulation requires that any samples drawn by Member States should be representative at a regional as well as a national level. The regional breakdown of a small number of variables for all industries is foreseen by the SBS Regulation. Financial services enterprises are generally concentrated in the financial market centres of each Member State.

3. What will business have to do to comply with the proposal-

Member States are required to compile the statistics. As the choice of characteristics is largely based on already existing administrative sources, additional data collection from enterprises will often be limited.

For information that is not yet available at national level in the frame of existing data circuits, Article 6 of the SBS Regulation allows Member States to use different sources of information. Member States may decide to sample the statistical units (enterprises) or send reduced questionnaires (in particular, on other financial intermediation, financial auxiliaries and environment). Those units drawn in the samples may be obliged (at the discretion of each Member State) to give honest and complete information within the prescribed deadlines.

4. What economic effects is the proposal likely to have-

- on employment

- on investment and the creation of new businesses

- on the competitiveness of businesses

The economic effects will be indirect in so far as it is expected that the Regulation will improve the quality and the availability of statistics on credit institutions, pension funds, other financial intermediation, financial auxiliaries and environment at Community level. As a result, transparency with respect to the effectiveness and structure of the internal market and the performance and competitiveness of enterprises in these sectors will be improved. In general, the competitiveness of the businesses increases as decision-makers have better information on the businesses in other Member States. Therefore, they will be able to improve their corporate and investment strategies, which may result in an increase in the internationalisation of their businesses. More competitive financial service providers with a broader range of products offered to final customers will be achieved.

5. Does the proposal contain measures to take account of the specific situation of small and medium-sized firms (reduced or different requirements etc)-

For the data to be collected, the population concerned is the total population. The proposed Regulation does not contain specific measures for small and medium-sized companies. However, this does not mean that all enterprises must be questioned with respect to the data not yet included in existing data collections. The use of sampling and methods of statistical estimation methods (expressly permitted by Article 6 of the SBS Regulation) will limit the additional data required from the units concerned. However, it is necessary to prove the quality of such methods.

Consultation

6. List of the organisations which have been consulted about the proposal and outline their main views.

The National Statistical Offices, the National Central Banks and other competent national authorities responsible for data collections have been consulted on many occasions during the preparation of this text. This draft Regulation was indeed presented and discussed at the meetings of the relevant working groups (last meeting of the Financial Services Working Group in November 1999, last meeting of Insurance Services Working Group (competent in the field of pension funds) in October 1999) and Task Forces (last meeting of Task Force Financial Services in April 2000, last Task Force Pension Funds in May 2000) at Eurostat, where both delegates of the competent national authorities and representatives of European professional associations and other international organisations were present. The draft text is supported by most of the Member States that have been closely involved in the preparatory work. Some Member States have already initiated implementation of the draft Regulation at national level on a voluntary basis.

DG MARKT of the Commission actively participated in the meetings of these working groups. The proposal accommodates the needs expressed by DG MARKT for statistical information in this field. DG MARKT has participated in drafting of the methodological manual that will support this legislation at technical and methodological level.

In June 2000, the Committee on Monetary, Financial and Balance of payments statistics (CMFB) discussed the proposed Regulation. The Members of this Committee generally supported the proposal. The Banking Advisory Committee (BAC), the Banking Supervisory Committee (BSC) and the Insurance Committee also reviewed the proposal, and these Committees all reacted favourably at the end of July 2000. The Statistical Programme Committee (SPC) discussed the proposal on 14 September 2000 and expressed an all over favourable opinion.

The financial services area represents a specific area of statistics, whose development is of high interest to the European Central Bank (which was also consulted during the drafting of the Regulation). A better quality of enterprise statistics on financial services contributes to an improvement of GDP measures, of the quality of short-term indicators, and an increase in the availability of data on EU banking structures with relevance to prudential supervision of credit institutions and to the stability of the financial system.

The proposal concerning the environmental variables is the result of intense discussions between experts in the Member States and the users at the European level, in particular DG Environment. Draft proposals have been discussed and approved at the meetings of the Environment Working Groups.