ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(77)561
Vol.1977/0184

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(77)561final.
Brussels,11November1977*
DRAFT FOR ADECISION
bytherepresentatives oftheGovernmentsoftheMemberStates
oftheEuropeanCoalandSteelCommunity,meetingwithinthe
Council,allocatingadditionalrevenuetothisCommunity
(submittedtotheCouncilbytheCommission)
COM(77)561final.

FINANCIAL TRANSFER TOTHEECSCOFTHECUSTOMSDUTIESONECSCPRODUCTS
I.Thedelicate "balanceof"theECSCbudget
TheECSCoperational "budget(whichapartfromthecontribution madetothe
generalbudgettocoveradministrative expenditure involvesresettlement
andresearchaids,interestsubsidiesforinvestmentandredevelopment
projectsintheECSCsectorandaidforthemarketingofcokingcoaland
metallurgical coke)isfinancedfrominterestoninvestmentsandloans
grantedoutofnon-borrowed funds,thesumsmadeavailablebythecancelling
ofcommitments and,inparticular,bytheweight–basedleviesonECSCproducts
fixedeveryyearbytheHighAuthority/Commission.
Inthelastsixyearstherateoflevyadopted-whichaccordingtoArticle50(2)
oftheECSCTreatymaynotexceed1%oftheaveragevalueoftheproducts
concernedwithoutpreviousauthorization bytheCouncil-hasremained
at0.2%,
Duringthisperiodandinparticularin1975»1976and1977»"theECSCfunds
havestagnatedas,despiteaslightannualincreaseatcurrentprices,the
realvalueofthebudgethasfallen.Atthesametime,operatingrecn?demerits
haveincreasedconsiderably,inparticularbecauseoftheproblem?Effecting
thesteelsector.
.'j

-2-
TheCommissionhasnotwishedtocovertheincreaseinfinancingrequirements
byincreasingthelevyrate;thisseemedtobeaneconomically inappropriate
measureintheconditionsprevailingintheECSCindustriesandinpartioular
thesteelindustry.
Itseemsthatthetimehasnowcometoabandonthepolicyconsistingof
reducingrequirements andlearningtoliveonthestagnatingresources *
Becauseofthefinancialrequirements arisingfromthesteelcrisis,which
theECSCcannotavoid,thisbodymusthavethemeanstobearitsresponsibilities
inrespectoftherationalization andrestructuring ofthisindustry.
II.Thesteelcrisis
Theseriousandpersistentimbalancebetweenworldsupplyofanddemandfor
steelputstheCommunity'sindustry,traditionally anetexporter,intoa
positionwhichismadeevenmoredifficultbythefactthatpartofthe
Europeanproductionapparatusisnotsufficiently competitivevis-fir-vis
thenewsteel–producing countries *
Therestructuring ofthesteelsector,withaviewtomodernizing and
stabilizingit,istheonlysolutionlikelytoensureitssurvivaland
guaranteethejobsoftheremainingworkers.
AnyattempttodivideuptheCommunitymarketortocloseittoimports
wouldprejudicetheCommunitysteelindustry'sprospectsoflong-term
economicviability–eitherbecausejobsandorderswouldbeensuredonly
bymeansofpublioaidstoproductionorbecauseprotectionist measures
wouldgraduallyleadtoanextremelydamagingtradewar*

Nonetheless ,thisdoubleriskisrealandavigorousCommunitypolicy,in
olosecoordination withthepolioiesoftheMemberStates,willbeneeded
toobviateit.
Theplanforinternational measuresmusttakeaccountofthefactthatthe
steelcrisisisworldwide,andthatthefirststepmustbetoapproaohthe
centralproblemofadjustingworldstructurestotheaotualrequirements .
Hewmarketdisturbances mustbeavoided.AtCommunitylevel,thesuccess
oftherecoveryplanpresupposes areducedlevelofimportsandastable
levelofexports.
Bytakingmeasuresontheinternalmarketinvolvingbothvoluntaryrestriction
ofdeliveries,andtheintroduction ofguidepricesforthemainrolled
productsandminimumpricesforconcretereinforcingbars,theCommunity
ishelping:toalignsellingpricesontheproductioncosts;toreduce
thelossoffinancialreturns–or,moreoften,theconsiderable losses–
sufferedbyCommunityproducersontheirsales;andtocreatetheconditions
forundertaking themorebasicoperationofrestructuring .
Finally,bymeansofastructuralpolicybasedontheGeneralObjectives
Steel1985-1990,revisedinagreementwiththeproducers,workers,oonsumers
andtheGovernments,theCommunityintends,withtheassistanceofthe
Governments tomakeacontribution towards:
(i)modernizingsteelplant;
(ii)creatingalternativejobsinthesteel-makingareaswhererestructuring
hasreducedthenumberofjobsexisting;
(iii)guaranteeingtheincomesandbringingabouttheresettlementofworkers
forcedtoleaveorchangetheirjobs.

-4-
Thescaleofrestructuring ,redevelopment andresettlement isconsiderable :
itinvolvesanunavoidablylargenumberofsteelworkersandalargenumber
ofothersinsecondaryandtertiaryactivitieslinkedwithsteel;the
successfulconclusionofthisoperationdemandsfargreaterfundsthanthe
Communitypolicyhassofarmadeavailableinnormaltimes.
ButfailuretomakethisexceptionaleffortatCommunitylevelwouldeventually
befarmorecostlyforeachMemberStateindividually .
Findingtherequisitefundsforthispolicyentailsmaintainingthecontribution
madebythesectoritselfviathelevy,applyingamarketpolicybasedon
restoringpricelevelsandintroducinganewfactor,namelytheallocation
totheCommunityofthecustomsdutiesoncoalandsteelimports.
III.Increasingthebudgetaryfunds
UndertheDecisionof21April1970onownresources,thedutiesofthecommon
customstariffwereallocatedtotheCommunities asownresourcesfrom
1January1971*
Thisallocation wasnotextendedtothecustomsdutiesoncoalandsteel
productscoveredbytheEC3CTreaty,asthecommoncustomstariffadopted
onthebasisofArticle9oftheEECTreatydoesnotapplytoproductscoming
undertheECSCTreaty.
True,thecustomsdutiesonECSCproduotsmayhavebeenstandardized in
accordancewiththedecisionstakenunderArticle72oftheTreatyofParis,
buttheyarestillallocatedtoeachMemberStatewhiohcollectstheamounts
whenthegoodsareimportedontoitsterritory *
I
/

According totheestimates available attheCommission ,these customs
duties amount toaround 50-60 mEUA .
Asregards theECSC 's "budgetary requirements for1978 ,theCouncil has ,
during thestudy oftherevision oftheECSC administrative budget ,already
"been notified ofsome oftheforeseeable budgetary problems .TheCommission
stated then that theextra uncovered financing requirements would bebetween
32and65mEUA.This assessment wasbased ontheassumption that theECSC levy
rate would bemaintained at0»29fo andthat administrative expenditure would
bereduced from 18to5mEUA *
COREPER gave itsagreement tothesecond assumption atitsmeeting on26.10.77 ,
• - ■
1
Initsdraft budget for1978 ,theCommission inoluded allocations of152mEUA
which itconsiders irreducible andwhich ,moreover ,represent only 56f0of
requirements .
inmEUA
Category ofexpenditure Requirements Draft budget
1.Administrative expenditure 5 5
2.Resettlement aid 81.5 60
3.Research aid 82.5 41
4.Interest relief 85 40
5.Aids tocoking coal and 6 6
metallurgical coke
273 152

«•o••
Thesteelcrisishasthusled,inparticular,toincreasedrequirements
forresettlementaidamountingto60mEUA(comparedwith25mEUAin
1977)ar|dinterestsubsidiesamountingto40mEUA(comparedwith15mEUA
intheinitialbudgetand21»8mEXJAintheamendingbudgetforthe
financialyear1977)*
Ontherevenueside,thisbudgetwillbe32mEUAindeficitifitis
assumedthatthelevyrateismaintainedat0.29fo»Asitisevidently
not-advisabletotakeanydecisiontoincreasetherateandasother
possibilities existforobtainingthenecessaryresources,theCommission
proposes ,totheCouncilthatthedeficitof32mEUAshouldbecoveredby
transferring totheECSCsomeofcustomsdutiescollectedoncoalandsteel
in1978.
Thistransfermaybeconductedonthelegalbasisofthesecondparagraph
ofArticle49oftheECSCTreaty,andwouldamounttoagif$fromthe
MemberStatestotheCommunity *
TV.Conclusion
TheCommissionproposestotheCouncilthattheneoessaryprocedures beset
inmotionforallocatingtheECSCcustomsdutiestotheECSCoperational
budgetassoonaspossible*Inthemeantime,andinpartanticipation
ofadecisionalongtheselines,theCommissionconsidersthatthe
exceptionalfinancialrequirements ofthesteelsectorin1978®ndthe
majoreconomicandsocialinterestofpursuinganeffeotiveCommunitypolicy
fortherestructuring andredevelopment ofthesteelsectorandthe
resettlement oftheworkersinvolvedfullyjustifyadeoisionbythe
MemberStatestotransfertotheEuropeanCoalandSteelCommunitya
voluntarycontribution of32mEUAfromtherevenuefromtheouBtoms
dutieswhichtheycollectongoodswhiohtheyimportfromnon-membercountries
andwhichoomeundertheTreatyestablishingthisCommunity *

-7-
AdraftDecision "tothiseffectiscontainedintheannex.
Ifthisproposalmeetswithinsurmountable difficulties ,theCommission
willnotacceptasituationinwhichthevolumeoftheECSOoperational
budgetfallstothelevelcorresponding toalevyrateof0.29/S,since
thiswouldnotformanadequate "basisforarationalandeffectivepolicy#
InthiscasetheCommissionwouldimmediately submitanewdraft "budget
inoreasingthelevytotheextentrequiredtoachieve "budgetaryequilibrium#

Draft
Décision
bytherepresentatives oftheGovernmentsoftheMemberStates
oftheEuropeanCoalandSteelCommunity,meetingwithinthe
Council,allocatingadditionalrevenuetothisCommunity.
THEREPRESENTATIVES OPTHEGOVERNMENTS OPTHEMEMBERSTATESOPTHE
EUROPEANCOALANDSTEELCOMMUNITY,MEETINGWITHINTHECOUNCIL,
Whereas,inthepresenteconomicsituationofthecoalandsteelindustry,
itisneoessarytoincreasethefinancialmeansattheCommission's
disposalforaccomplishing thetaskassignedtoitbytheTreatyestablishing
theEuropeanCoalandSteelCommunity;whereasunderArticle49ofthis
Treaty,theCommission "mayreceivegifts";whereastheMemberStates
shouldnowgrantitgiftsofadditionalrevenue,themostappropriate
beingtherevenuefromthecustomsdutieswhiohtheycollectonooaland
steelinthecourseoftradewithnon-membercountries;
inagreementwiththeCommission,
HAVEDECIDED:
Article 1
TheMemberStatesshalltransfertotheEuropeanCoalandSteelCommunity
forthefinancialyear1978avoluntarycontribution of32mEUAfromthe
revenuefromthecustomsdutieswhichtheycollectongoodswhichthey
importfromnon-membercountriesandwhiohcomeundertheTreaty .,
establishing thisCommunity *

Article2
TheMemberStatesshall,inolosecollaboration withtheCommission ,take
allappropriate measurestoensuretheimplementation oftheprovisions
ofArticle1;theyshallinparticularfixthecommonconditionsfor
makingavailabletotheCommunitythesumsreferredtointhisArticle,
Article3
TheMemberStatesshalltakeallthemeasurestoimplementthisDeoision.
Doneat
ThePresident