WRITTEN QUESTION E-3591/01

by Ilda Figueiredo (GUE/NGL) to the Commission

(8 January 2002)

Subject: Luís Elvas company and the textile and clothing sector in Portugal

The Luís Elvas LDA company (confecçoes Montebela), based in Belmonte, in an inland area of Portugal where there are few jobs, even in industry, is going through a difficult period. It currently has a workforce of 200 workers, compared to an earlier figure of 300.

Following a major investment about five years ago, the company went through a difficult period as a result of significant bad debts, amounting to ESC 150 million, after clients in France and the United Kingdom went bankrupt.

The tough competition from third countries in the sensitive textile and clothing sector is making the situation even worse and jeopardising the company's future, with all the consequences this can have for employment, mainly among women and the development of this inland area of Portugal.

Can the Commission answer the following:

- What support has the Community given the Luis Elvas company?

- What aid does the Commission intend to provide for companies in the textile and clothing sector affected by the bilateral agreements between the European Union and third countries?

- How does it intend to support SMEs, especially in such sensitive sectors as the clothing trade, which are affected by bad debts in other EU countries?

Supplementary answergiven by Mr Barnier on behalf of the Commission

(8 May 2002)

The Union supports firms by providing part-finance from the Structural Funds and the Cohesion Fund for training, innovation and research. The Commission would, however, point out that the choice of projects is a matter for the Member States. According to information received from the Portuguese authorities, Luis Elvas Lda has received no part-finance from these Funds.

The Commission would also point out that when negotiating textiles agreements with non-member countries it seeks to strike a balance between opening up the markets of those countries and the concessions which it is willing to grant, so that any opening up of the Union market is accompanied by market opportunities in the non-member countries. In its decisions on the opening up of the textiles and clothing sector in 1995-2004, as required by the rules of the World Trade Organisation (WTO), the Union is acting gradually to ease the transition towards open import arrangements. As a result, the Commission believes that it would be inappropriate to provide individual aid to firms or to a particular sector because of those agreements. However, Community appropriations for programmes part-financed by the Structural Funds could be used to enhance the competitiveness of regions and promote job creation. The whole of Portugal is eligible under the Structural Funds during the current programming period (2000-2006).

No financial support is provided for at Community level for firms solely on account of irrecoverable debts in other countries of the Union. However, since the entry into force on 1 March 2002 of Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters(1), a more rapid and semi-automatic mechanism permits each Member State to speed up the recovery of claims from firms established in other Member States. This Regulation simplifies the formalities for the simple and rapid enforcement of judgments in civil and commercial matters by the Member States in order to ensure the smooth operation of the internal market. Hence a judgment secured in

one Member State will be fully recognised without any further formalities, unless it is disputed. This means that the procedure required to enforce in one Member State a judgment issued in another will be considerably simplified and hence made more effective. In addition, the Commission is currently completing preparation of a proposal to introduce a European enforcement order for uncontested claims, which would do away with exequatur for certain claims.

(1) OJ L 12, 16.1.2001.