WRITTEN QUESTION No. 3437/97 by Cristiana MUSCARDINI to the Commission. Detention on remand
Date: 1997-10-31
Institutions: European Parliament, MUSCARDINI
Subjects: EU control, European Commission, European Convention on Human Rights, European Union, application of EU law, competence of the Member States, detention before trial

C 134/164

EN

Official Journal of the European Communities

30. 4. 98

Answer given by Mr Papoutsis on behalf of the Commission

(15 December 1997)

Although usury is a recognised phenomenon in the area of consumer credit, it is not generally considered to be a
problem  which  affects  firms.  Owners  and  managers  of  businesses  are  deemed  to  be  sophisticated  economic
operators who understand and accept the obligations into which they enter when taking out credit. Moreover,
they benefit from a competitive market, especially now that interest rates and economic conditions have been
generally stable for some time. They can usually change credit supplier if they are dissatisfied with the service
they are receiving.

The interest rates paid by small and medium-sized enterprises (SMEs) for their credit typically fall in the range of
2% to 5% above the base lending rate and are thus far lower than the rates which typically characterise cases of
usury.  Rates  may,  however,  be  higher  under  certain  circumstances,  usually  when  the  borrower  is  considered
more risky than average and the lender therefore adds a risk premium to the normal lending rate. This is entirely
normal business practice and partly reflects the increasing sophistication and accuracy of the risk assessment
systems used by lenders. It is also true that, in some southern Member States, margins on lending to firms are
higher  than  the  European  average,  but  this  is  largely  an  historical  phenomenon  and  reflects  local  financing
practices.

The Commission is committed to improving access to finance for Europe’s SMEs, as demonstrated by its support
for  the  second  round  table  of  bankers  and  SMEs,  which  published  its  final  report  in  February  1997.  This
initiative,  which  brought  together  representatives  from  both  banks  and  European  SME  organisations  over  a
period of eighteen months, examined in considerable detail many of the issues involved in SME financing. The
problem  of  usury,  however,  was  not  mentioned  at  any  time  and  has  not  been  brought  to  the  Commission’s
attention as a major concern for the members of SME representative organisations.

For this reason, the Commission does not feel that it is appropriate or necessary either to establish a permanent
observatory  on  usury  or  to  prepare  a  directive  on  the  subject.  It  is,  nonetheless,  committed  to  continuing  its
efforts to facilitate SMEs’ access to the many established sources of finance and, to this effect, will be launching a
third round table of bankers and SMEs in 1998 to build on the work of its predecessors.

(98/C 134/223)

WRITTEN QUESTION E-3437/97

by Cristiana Muscardini (NI) to the Commission

(31 October 1997)

Subject: Detention on remand

The Strasbourg-based European Commission of Human Rights is critical of the excessively long detention on
remand  in  the  Contrada  case,  which,  according  to  its  understanding,  violates  Article  5(3)  of  the  European
Convention on Human Rights.

Protracted detention on remand not only damages individual rights, but also, in practice, slows down trials and
the related investigations.

Will  the  Commission  set  up  a  committee  of  inquiry  to  identify  the  European  countries  where  the  length  of
detention on remand exceeds the time laid down in the European Convention on Human Rights, which has been
signed by the Member States?

Answer given by Ms Gradin on behalf of the Commission

(15 December 1997)

The Commission has no power to investigate alleged violations of the European Convention on Human Rights in
the Member States when the legislation in question or the actions of the national authorities relate to matters not
covered by Community law.

The period of detention on remand in the Member States is such a matter.