WRITTEN QUESTION No. 2463/97 by Ernesto CACCAVALE to the Commission. VAT levy on European Funds for SMUs
Date: 1997-07-08
Institutions: CACCAVALE, European Parliament
Subjects: EU aid, Italy, Structural Funds, VAT, aid to undertakings, fraud against the EU, small and medium-sized enterprises, tax system

C 102/42

EN

Official Journal of the European Communities

3. 4. 98

(98/C 102/60)

WRITTEN QUESTION E-2445/97

by Graham Watson (ELDR) to the Commission

(16 July 1997)

Subject: British Telecom Internet provision

As part of the election manifesto, the British Labour Party pledged to provide Internet access across the length
and breadth of the United Kingdom. An agreement was struck with British Telecom accordingly.

Now that Labour is the governing party in the UK, does the Commission agree that any such deal will effectively
give  British  Telecom  a  monopoly  in  backbone  provision  of  the  Internet?  Will  the  Commission  undertake  an
investigation to clarify whether this agreement contravenes EU competition law?

Answer given by Mr Van Miert on behalf of the Commission

(15 September 1997)

No discussions have been held with the Commission about any possible competition implications of any such
agreement, either on behalf of the United Kingdom government, British Telecom (BT), or interested third parties.
If  such  an  agreement  were  to  be  implemented,  the  Commission  would,  if  appropriate  wish  to  examine  its
implications in the light of Articles 85 and 86 of the EC Treaty, and, also possibly, Articles 5 and 90 of the
EC  Treaty.  Any  party  adversely  affected  by  any  such  agreement  can,  of  course,  make  representations  to  the
Commission or the appropriate national regulatory authority.

In the Internet field, the Commission has already opened an investigation into the issue of access to facilities
controlled by public telecoms operators for Internet service providers in the United Kingdom and some other
Member States.

(98/C 102/61)

WRITTEN QUESTION P-2463/97

by Ernesto Caccavale (UPE) to the Commission

(8 July 1997)

Subject: VAT levy on European Funds for SMUs

The global grant › an instrument aimed at providing funding for local development projects › is granted by the
Commission to intermediary bodies responsible for identifying, selecting and assisting the final beneficiaries,
such as small and medium-sized undertakings.

Following complaints to the Ombudsman and protests submitted by individuals to the offices of the Commission
and the European Parliament, it appears that taxation on global grant funds varies from country to country and, in
particular, that the Italian Government imposes VAT on such funds. This in effect deprives SMUs of a large
proportion of the funds granted by the Commission, which are of course subject to tax exemption.

Will  the  Commission  provide  detailed  information  on  the  provisions  contained  in  contracts  signed  with
intermediary bodies in respect of global grants in the various Member States?

Will it state what tax provisions are applied by each Member State in which the Commission has granted the
global grant?

Can it state whether Italy has in fact obtained unjustified funds to the detriment of SMUs by taxing amounts paid
under the global grant?

Lastly, will it provide a detailed list of intermediaries which to date have signed contracts with the Commission
for global grants?