ARCHIVES HISTORIQUES
DELACOMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (77)277
V ol.1977/0094

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(77)277 final
Brussels ,28July 1977
REPORT OF THE COMMISSION ON THE WORKING OF THE
BUSINESS COOPERATION CENTER DURING THE PERIOD ,
FROM NOVEMBER 1975 toOCTOBER 1976 .
COM(77)277final

ANNUAL REPORT (November 1975 -October 1976 )
1.Status and duties ofthe Business Cooperation Centre
Asagreed between the Commission and the Council atthe tine of
theestablishment oftheBusiness Cooperation Centre in1973 ,the
Commission sent areport tothe Council ofMinisters atthe end of1975
assessing theexperience andresults oftheCentre 'sthree years of
activity (Doc .COM(75)694 of23December 1975).
Following anexchange ofviex^s onthis report between the
Commission and the Council ,the Council representatives unanimously
agreed that theCentre 'sactivity inthefield oftransnational coopera­
tion between firms inthe Community should becontinued and were very
pleased with theresults obtained .
Inaccordance with theintentions outlined inthereport ,the
Commission in1976 has decided :
-toconfirm thestatus oftheBusiness Cooperation Centre (1);
-toinstruct itbesides tocarry outcertain tasks involving
coordination inthefield ofsub-contracting ;
-tostudy thepossibility ofincluding some non-member States inthe
Centre 'sactivities .
./.
(1)That istosayunder the terms oftheCommissions instructions of
the 21st June 1973 :
-tosupply firms ofthe Community with information onthelegal ,
administrative ,fiscal and economic aspects ofcross-frontier
cooperations and mergers ,-tosearch for andestablish contacts between Community firms
wishing tocooperate ,-todraw theattention ofthe Community Authorities toany obstacles
encountered bytheOffice itself orthefirms concerned ,with
resoect tocross-frontier cooperation within the Community .

V olume ofactivity
1. The Business Cooperation Centre 'svolume ofactivity has been
affected byboth seasonal and cyclical factors ..
.Each year there has been anupsurge ofinterest byCommunity
firms between the months ofJanuary andApril .This isexplained bythe
fact that firms are preparing their annual accounts atthat time and,
inconsequence ,their reports onthe long-tern future ofthe company .
In1976 ,this normally slight accentuation ofinterest was lent
considerable momentum bythe hopes which arose inthe spring that there
would beanimprovement inthe economy .This increase inactivity slowed
down again after May 1976 ,aswill beseen from therelevant graph
(Annex ).
2. The Business Cooperation Centre 'sactivities between November
1975 and October 1976 were asfollows :
Information :number ofrequests 512
Search forpartners
-number ofrequests 77
-number ofreplies 910
-contacts made 63
wereAsaresult ofthese contacts ,about fifty cooperation agreements
confirmed bytheCentre : r

-A-
Sector Type ofcooperation Nationality of
firm
-Paints
-Plumbers fittings
wholesale manu -
facturers
-Hospital equipment
Fertilizers
Lubricants
Milk products
Foodstuffs
Industrial
packag ing
Mechanical
engineering
Accounting experts
Data processing
Chemical indus try
BankingReciprocal distribution
Joint sales onnon-European
markets
Reciprocal distribution ,
exchange oflicences
Joint distribution subsidiary
Pooling ofknowhow ,sales
under joint trade mark
Reciprocal distribution
Joint distribution subsidiary
Exchange ofknowhow ,reciprocal
help
Joint subsidiary
Recinrocal representation
Joint development and execution
ofprojects
Reciprocal distribution
Reciprocal management of
operations abroad
Wire manufacturing Exchange ofsales networksF-I
F-GB
D-I
F-G3
13-7D-10F
1NL
IRL -NL
I-NL
GB-NL
D-IRL
IRL "3
DK-G3
D-B
B-D-F
D-G3
Thus ,since itscreation in1973 ,theBusiness Cooperation Centre
has been responsible for some fifty cooperation agreements involving
the following partners :
24British firms
23French firms
22German firms
16Belgian firms
9Dutch firms
8Italian firms
2Danish firms
3Irish firms
1Luxembourg firm
108

-Η-
2.3 . The interest -(1)shown byfirms mthevarious member countries
between 197 'Vand 1976 displayed thefollowing pattern (%):
Β D DK F GB I T.RL L NL
1974 12.8 35.5 3.4 11.9 18.8 6.9 4.7 0.6 6.2
1975 10.5 22.0 2.8 16.9 28.2 9.4 2.5 0.3 7.4
1976 10.2 22.1 2.5 15.8 29.2 11.1 1.5 0.2 7.4
Thus ,bycomparison with the twofirst years ofexistence ofthe
Business Cooperation Centre ,participation byFrench andItalian firms
has improved considerably .
3.Methods
3.1 . Asits experience has broadened ,the Business Cooperation Centre
has realized more and more the need tomaintain contact with the firms
before and/orafter theinitial contact with potential partners .Very
often mistrust ormisunderstandings can cause discussions tofalter ,or
even break down ,atthefirst real hurdle where some compromise ormore
detailed investigation isrequired .Insuch cases theintervention of
athird ,n#?-.tral and objective partjcould getnegotiations going again .
Byway ofillustration ,inthe case ofmultilateral cooperation
between nineteen small lubricant manufacturers infour Community
countries ,discussions had been inprogress for three years when the
„participants called ontheBusiness Cooperation Centre toarbitrate and
thedeadlock was subsequently broken .
./.
(1)Total requ ^0*"" L?f«%*-»»9«-i .rpnqegts forpartners andreplies .

3.2 . Very often also the heads offirms ,especially family businesses ,
preoccupied bythe problems ofday -to-day management ,tend toneglect
theaspects ofmedium /and long term development .
The deeper analysis ofdossiers permits theOffice tosubmit to
therequesting applicant acoherent collection ofreplies ,reduced to
real cooperation possibilities .Bythus presenting tothefirm amore
complete service atthe exchange ofinformation and preliminary discussion
stages ,theOffice increases the chances ofsuccessful outcomes inthe
cases handled .
3.3 . The build-up ofcontacts with several thousand firms will in
thefuture enable the Business Cooperation Centre totranscend its
passive and somewhat mechanical role soastobemore actively involved .
Toacertain extent itwill beable toequally play therole ofa
catalyst when itestablishes that the need and themotivation to
cooperate are present incertain businesses .
For example ,theCentre has found ,insome bilateral contacts
between banks ,that there isvirtually nostructure for communication
and transnational cooperation between small -and medium-sized deposit
banks .For foreign operations ,the small banks call upon the large
banks inthe other countries .The large banks donot ,however ,given
reciprocity since they use their counterparts inthe country concerned
for corresponding operations .
./.
<

-6-
Inthelight ofthis ,and having ascertained that anumber of
private banks were interested inremedying this situation ,the Business
Cooperation Centre intends tobring together anumber ofprivate banks
inthevarious Member States and tosuggest tothem that they set upa
multilateral network where each one would act asacorrespondent for the
others inits own region .
3.4 . With the same end inview ,theOffice offers toorganise meetings
between industrialists ofthe same sector ,ifthesectorial Federations
ofthe member countries with which itisincontact ,signify toit
the opportunity orthe need .
4.The obstacles encountered
The Business Cooperation Centre also extends its own experience
asregards obstacles which the firms encounter .
4.1. Thus ,inits December 1975 report ,theCentre referred toa
cooperation agreement concluded inthespring of1975 between three coach
operators (British ,French andItalian )with aview tosetting upregular
long distance services .This project was due tostart on 1April 1976 .
However ,itwas only after repeated representations bythefirms ,the
Business Cooperation Centre and therelevant Commission departments ,
that inDecember 1976 ,thenecessary authorizations were obtained from
the governmental departments concerned .

4.2. Inthecase already quoted ofmultilateral cooperation between
independent lubricant manufacturers ,willingness tocoooerate was
thwarted foraIon® time bytheabsence ofanyuniform orCommunity
system ortrade marks ,since theapplication ofdifferent national
systems ledtocontradictions which had tobeovercome byaseries of
phased contractual arrangements .
4.3. Inaddition ,thepartners aretrying tofind themost suitable
national legal instrument andregret that they areasyetunable tocall
upon aEuropean Cooperation Group swhich ,byitstransnational nature ,
would betheonly medium for ensuring that all thepartners would be
onanequal footing .
4.4. .Inthe food sector ,cooperation has not been possible because
ofthedivergency innational rules :
-aDanish bacon manufacturer and aFrench charcuterie manufacturer
were not able toreach any agreement because ofthe Danish ban on
imports ofpork products from countries which vaccinate against swine
fever (l)r
-aBritish firm and aGerman firm failed toreach agreement because
aproduct sold intheUnited Kingdom under the name ''Ginger Wine''
cannot beimported into theFederal Republic ofGermany .
4.5. Onmost ofthese points ,the Community hasalready initiated
either aharmonization process ortheestablishment ofuniform instruments .
TheBusiness Cooperation Centre 'sexperience confirms theneed for and
urgency ofachieving Community orharmonised systems .
./.
(1)ACommunity regulation istabled tobecome inforce with effort
from 1978 .

Sub-contrac ting
In1976 ,the Commission asked the Business Cooperation Centre to
undertake certain tasks inconnection with sub-contracting ,and in
particular set upcoordination between national orregional centres
engaged inpromoting sub-contracting .
1. Inthis context the Business Cooperation Centre has given financial
support tothejoint effort byfour organizations (German ,French ,
Luxenburger and Dutch )which have set about preparing acommon nomen­
clature where sub-contracting isconcerned .This working instrument ,the
main value ofwhich will beitsmultinational acceptability ,should open
the way for exchanges ofinformation between subcontractors' exchanges
incountries orregions participating inthe scheme and make itpossible
toprepare comparable registers ofsubcontractors .
The Eusiness Cooperation Centre will try toextend this arrange­
ment toother Community countries .Belgium has already agreed toparti­
cipate inthe scheme .
2. Following various contacts ,the Business Cooperation Centre has
identified anumber ofdefinite projects which come within the scope of
its operational field . '
-preparation ofalist ofdecision-influencing factors (technical ,
commercial ,social ,economic )for theguidance offirms who are
potential orderers iatheir choice astowhether to"doorhave done 1.
This check-list should supported bycase studies .
-Inview ofthemultiplication ofsubcontractors' fairs ,there is
clearly aneed towork out acoordinated timetable with the help of
the organizers inorder toavoid clashes ofdates .

τ
Anumber oforganizations which act aspromoters orintermediaries in
subcontracting invarious countries orregions inthe Community have
stated their desire for theopportunity toexchange experience .The
Business Cooperation Centre intends toorganize such exchanges of
knowhow onamultilateral basis .
Insome sectors ,European subcontractors frequently take aninsignifi­
cant part ,even inthe case ofproducts which are tobeassembled or
used inthe Community .Anexample isoff-shore construction -since the
majority oforderers ,consultants and standards are non-European ,the
sub-assemblies are generally built bynon-European firms .
Ithas been suggested that the Community should make approaches tothe
orderers inthis connection .

•\C7IVITILS OFTHE BUSINESS 'OPKRAT .[)NCENTRE,TO 31st OCTOBER 197o
Moving average over 3months
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KEY JRequests Cor information
Requests forpartners circulated
Renlies received