COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT pursuant to the second subparagraph of Article 251 (2) of the EC Treaty concerning the the common position reached by the Council with a view to adopting a Decision of the European Parliament and of the Council on computerising the movement and surveillance of excisable products

2001/0185 (COD)

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT pursuant to the second subparagraph of Article 251 (2) of the EC Treaty concerning the the common position reached by the Council with a view to adopting a Decision of the European Parliament and of the Council on computerising the movement and surveillance of excisable products

1- BACKGROUND

Date of transmission of the proposal to the EP and the Council (document COM(2001) 466 final - 2001/0185 COD): // 19 November 2001

Date of the opinion of the European Economic and Social Committee: // 29 May 2002

Date of the opinion of the European Parliament, first reading: // 24 September 2002

Date of transmission of the amended proposal: // 20 December 2002

Date of adoption of common position, by qualified majority: // 21 January 2003

2- AIM OF THE COMMISSION PROPOSAL

The aim of the Commission proposal for a Decision of the European Parliament and of the Council is to set up a computerised integrated system for the monitoring and control of the intra-Community movement of excisable goods (alcohol, tobacco and mineral oils). The integrated system would replace the accompanying administrative document - a piece of paper which currently accompanies excisable goods when they are moved between Member States under excise-duty suspension arrangements - by a computer messaging system linking traders with each other via their respective national administrations.

The Commission proposal sets out the respective obligations of the Member States and the Commission with a view to implementing the system and provides for a specific budget for developing the Community components of it.

3- COMMENTS ON THE COMMON POSITION

3.1 General remarks

The Commission welcomes the Council's endorsement of the original proposal's general thrust. It notes that the Council is in favour of implementing the computerised system presented in its proposal.

3.2 CONSIDERATION OF THE AMENDMENTS PROPOSED BY PARLIAMENT AT FIRST READING

In its common position the Council did not take on board all the amendments proposed by the European Parliament.

Amendment 6 is one of the amendments that can be regarded as fully or partly accepted: its purpose is achieved by the Council's amendment to subparagraph 1 of Article 2. The essence of amendments 1 and 7 was contained in a joint statement for the Council minutes. Amendment 11 was partially retained by the Council (the first part of the amendment). Amendment 5, which concerned only the English version of the text, was also accepted by the Council.

The Commission is satisfied that the Council did not accept amendment 10, which the Commission itself rejected, since it would involve amending the tax rules applicable to excisable products and these come under the scope of Council Directive 92/12/EEC of 25 February 1992.

However, the Commission regrets that the Council did not take on board other amendments of the European Parliament which the Commission accepted, either as they were (amendments 2, 3, 4, 9 and the last part of amendment 11), or reformulated (amendment 8). The Commission considers that those amendments improve the content and scope of its original proposal.

3.3 NEW PROVISIONS INTRODUCED BY THE COUNCIL

The Council amended the content of several provisions.

These substantive amendments concern first of all the legal scope of the decision: the Council considered, by qualified majority, that the purpose of the Commission proposal was not to amend tax legislation but to give the Commission and the Member States the financial and human resources to develop the computerised system for the monitoring and control of excisable products and to set out the respective obligations in setting up such a system. Accordingly, the Council amended the objectives originally contained in Article 1(2)(b) and (c), and added recital 10 and amended recital 3. The Commission can accept this.

The other amendments made by the Council relate to the timetable. Articles 2 and 12 were amended: the system must now be deployed over a period of 6 years (instead of 5), commencing at the latest 12 months (instead of 9) after the decision is adopted, the date for which is scheduled for 1 January 2003 (instead of the 20th day following its date of publication in the Official Journal). The Commission supports the Council's amendments.

Finally, in Article 7 the Council simplified the management procedure for the system: the Excise Committee alone is now to be competent for monitoring the system's implementation.

3.4 LEGAL BASIS FOR THE PROPOSAL

The Commission notes with satisfaction that after the discussions within the Council the common position was finally adopted by qualified majority on the basis of Article 95 of the Treaty establishing the European Community, in line with the Commission's original proposal.

4- CONCLUSION

The Commission considers that the common position constitutes an acceptable compromise but regrets that the Parliament's amendments were not taken on board more fully.

The Commission is nevertheless convinced that a common position can be reached by the Council and Parliament. To this end the Commission has presented in its amended proposal a compromise text aiming to reconcile the two institutions' approaches.

5- COUNCIL AND COMMISSION STATEMENTS FOR THE MINUTES

The Commission and the Council made three joint statements for the minutes, annexed to this communication.

The first statement underlines the fact that the proposal for a decision is not of a fiscal nature, which was why it was presented on the basis of Article 95. The statement also notes that any tax provision relating to the use of the computerised system would require the adoption of amendments to Council Directive 92/12/EEC.

The second statement notes that as much of the new computerised transit system as possible should be reused when the Community components of the system are being developed.

The third statement explains that instruments for the use of data to combat fraud must comply with national legislation in this field.

Statements for the minutes

Re Article 1

The Council and the Commission state that this Decision is a purely non-fiscal measure aiming at the improvement of the functioning of the internal market. Any fiscal aspects related to the use of the computerised system for the movement and surveillance of excisable products (EMCS) will require the adoption of the appropriate amendments of the Council Directive 92/12/EEC, in accordance with the provisions of the Treaty. This decision does not prejudice the legal basis of any future amendments of Directive 92/12/EEC.

Re Article 1 and 4

["The Council and the Commission note that, in the work on the Community components of the computerised system for the movement and surveillance of excisable products (EMCS), consideration is given to reusing as much of the New Computerized Transit System (NCTS) as possible, in order that the EMCS-system is compatible with and, if technically possible, integrated with the NCTS."]

Re Article 4(1)(b)

"The Council and the Commission state that, the instruments for the exploitation of data to combat fraud will respect national legislation in this area."