EN Official Journal of the European Union CE 78/124

(2004/C 78 E/0126)

WRITTEN QUESTION E-2541/03

by Maurizio Turco (NI) to the Commission

(30 July 2003)

Subject: The ‘Gescartera’ case and agreements between the Spanish State and the Holy See

Gescartera, the brokerage firm which invested in the stock market and became involved in Spain's worst stock-market fraud (leaving EUR 87 million unaccounted for) included among its clients a number of organisations linked to the Catholic Church.

Six of Gescartera's 15 largest clients in terms of volume of profits are religious bodies: Salesian Inspectors of Mary Help of Christians, Order of Saint Augustine, Philippian Missionaries of Education, Emilio Álvarez Gallego Foundation, Augustinian Missionaries and the Archbishopric of Valladolid. One of the clients which entrusted most money to Gescartera, and accordingly one of the main beneficiaries of artificial capital gains, was a body enjoying the exemptions provided for under Law 49/2002 on the tax arrangements for non-profit-making bodies and tax incentives for patronage, which granted such bodies an exemption in respect of income from property (Article 6).

Moreover, without wishing to lend credence to rumours that the archbishopric simulated fictitious ownership of the securities it invested, the amount invested does appear disproportionate in relation to an archbishopric such as that of Valladolid.

The archbishopric's accounts are opaque and contradictory, and it refused to cooperate when the investigating magistrate asked it to furnish its accounts between 1996 and 1999, by which time it had accumulated investments with Gescartera amounting to EUR 6 641 184 (which it withdrew when it learnt that Gescartera was being investigated by the CNMV, the National Commission for the Securities Market), and for the 2001 financial year, when it invested EUR 150 253. The Spanish Bishops' Conference supported this refusal to cooperate on the grounds that ecclesiastical documents are inviolable on the basis of the Agreement concerning Legal Affairs, which recognises and protects the Spanish Church's right to exclusive safekeeping of its archives and recognises that they are ‘inviolable’.

Under the Agreement concerning Economic Affairs between Spain and the Holy See, the system for financing the Catholic Church takes the form of an allocation system based on each taxpayer's income-tax statement explicitly in favour of the Catholic Church, and an allocation from the Spanish general budget (amounting to an average of 130 million pesetas). In addition, the Catholic Church enjoys a VAT exemption in contravention of Directive 91/680/EC (1). The fact that the budgets of the Catholic Church and the various bodies linked to it are not public and the allocation from the state is not made conditional on transparency in the Church's financial management makes it extremely difficult to establish whether or not the money which the Catholic Church invested on the stock market stemmed from the advantages it enjoys by virtue of the agreements with the Spanish State.

Is the Commission aware of these facts, and if so, what initiatives has it taken or will it take in response to these serious circumstances?

Does it consider the agreements between the Holy See and the Spanish State to be incompatible with the EC Treaty and the EU Treaty, and does it believe that the Kingdom of Spain has taken all appropriate steps to remove the incompatibilities?

Does it believe that complaints against infringements of the Constitution should be brought only through the country's national law, or can they be taken into consideration by the Community institutions as serious violations of the rule of law and democracy?

Answer given by Mr Bolkestein on behalf of the Commission

(18 September 2003)

The matters raised by the Honourable Member have not been referred to the Commission.

With regard to VAT, I would refer the Honourable Member to the reply to his Written Question P-3773/02 (2).

(1) OJ L 376, 31.12.1991, p. 1.

(2) OJ C 161 E, 10.7.2003, p. 142.