Opinion of the Economic and Social Committee on the 'Communication from the Commission on undeclared work'
Date: 1999-01-27
Institutions: European Economic and Social Committee
Subjects: ESC opinion, moonlighting

C 101/30

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Official Journal of the European Communities

12.4.1999

Opinion of the Economic and Social Committee on the ‘Communication from the Commission
on undeclared work’

(1999/C 101/09)

On 17 April 1998 the Commission decided to consult the Economic and Social Committee,
under Article 198 of the Treaty establishing the European Community, on the above-mentioned
communication.

The Section for Employment, Social Affairs and Citizenship, which was responsible for
preparing the Committee’s work on the subject, adopted its opinion on 7 January 1999. The
rapporteur was Mr Giron.

At its 360th plenary session (meeting of 27 January 1999), the Economic and Social Committee
adopted the following opinion by 119 votes to four, with five abstentions.

1.

Introduction

2. General comments

The Committee very much welcomes the Commission’s
desire to initiate a discussion on undeclared work so as
to enable the European Union to develop a strategy for
combating a problem that affects all its Member States.

The Committee endorses the Commission’s decision to
approach the problem of undeclared work from the
perspective of employment, since undeclared work
clearly undermines the funding of public services and
social security, hinders the functioning of other joint
welfare systems (training funds, pension funds and paid
holiday schemes, etc.) and distorts competition in
general. Curtailing undeclared work should also mean
that undeclared workers can be brought back into the
formal economy, as well as reducing the risks posed to
existing declared jobs.

2.1. Definition of undeclared work

The Committee considers the definition of
2.1.1.
‘undeclared work’ as ‘any paid activities that are lawful
as regards their nature but not declared to the public
authorities’ to be acceptable given the need to have one
definition for all the Member States.

2.1.2.
The Committee thinks that this definition
should be brought closer to the more familiar concept
of moonlighting in order to avoid confusion with
charitable or voluntary work, or with work undertaken
in a family context, particularly occasional domestic
work.

2.1.3. On the other hand, it goes without saying that
the practice of employer or employee not declaring part
of the work carried out also constitutes a form of
undeclared work.

The Committee considers this initiative to be particularly
expedient given that undeclared work affects mainly
small businesses which, as the Commission pointed out
in its communication of 26 October 1995, are the keys
to growth and employment in Europe.

2.1.4. However, the Committee notes that other types
of paid activity may exist that are lawful in principle
but unlawful when conducted in a certain way, and are
therefore not declarable and should be dealt with
appropriately.

The Committee notes the Commission’s request that all
the Member States, Community institutions and the
social partners should be mobilized with a view to
increasing awareness of the causes and extent of unde-
clared work, identifying better ways of combating it and
possibly mounting joint European Union action.

2.1.5.
In view of the ILO discussions on child labour
and the draft convention due to be adopted in 1999, it
might also be appropriate for the Commission to focus
rather more on this issue in its proposed analysis of
undeclared work (1).

In any event, the Committee can only reiterate
2.1.6.
its aversion to any type of child labour and its support

The Committee also approves the approach that allows
Member States to take different measures, depending
on the particular situations encountered.

(1) Cf. ESC opinion of 2 July 1998 on the exploitation of

children; OJ C 284, 14.9.1998.

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for a framework stipulated by national law and inter-
national standards.

2.1.7.
The Committee also wishes to raise the issue
of sub-contracting (1), which in practice, if abused, can
create a real problem of tax and contributions evasion
and undeclared work (whether self-employment or
employment by firms).

2.1.8.
The Committee suggests that the Commission
should discuss this problem, which has never been
specifically addressed.

2.2. Types of undeclared work

The Committee is pleased first of all that the Commission
has approached the issue of undeclared work from the
perspective of both businesses and individuals, since it
is necessary to address the issue from the angle both of
the person (natural or legal) doing undeclared work and
of whoever is employing them (business or individual).

2.2.1. M a i n r e a s o n s

2.2.1.1.
The Committee fully agrees with the Com-
mission’s analysis that the main attraction of undeclared
work is economic.

2.2.1.2.
This assumption should make it possible to
demonstrate the burden that taxation and social costs
on labour represent for both individuals and companies,
particularly small enterprises. It also highlights the tax
burden on private individuals, who are often the ‘buyers’
of undeclared work.

In this respect, the Committee has already recognized
the need to reverse the trend in taxation and shift the
main burden away from labour (2).

It is clear in this context that, while the market for
illegal employment can be seen as a general problem,
the less difference there is in financial terms between
declared and undeclared work, the less attractive unde-
clared work will become. In the meanwhile, ways of
at least lowering tax and social security costs for
labour-intensive businesses is a major avenue to be
explored.

2.2.1.3.
Although the Committee believes that a
number of historical factors have contributed, or could
still contribute, to the existence of undeclared work, its
main causes nevertheless seem to be:

— the burden of taxation and social contributions;

— regulatory and administrative burdens;

— inflexible labour laws;

— the influx of illegal immigrants.

2.2.1.4.
The Committee points out that undeclared
work is mainly seen in sectors (e.g. small business, retail,
services) dominated by small enterprises, which are
disproportionately burdened by a fiscal, social, regulat-
ory and administrative environment, as reported in the
White Paper of Commission President Delors (3).

2.2.1.5.
As the Commission observes, a whole series
of other factors may also favour or facilitate the
development of undeclared work (cultural acceptance,
low competitiveness,
lack of interest in the service
required, etc.).

However, the Committee does not agree with the
Commission that ‘the existence of craft corporations
may also be conducive to undeclared work’ (4), especially
since these are generally private organizations, member-
ship of which is certainly not necessary to exercise a
commercial activity.

2.2.1.6.
The Committee also thinks that the Com-
mission is not adequately addressing the problem posed
by systematic undeclared work and its potential impli-
cations for whole spheres of activity. For example, such
employment is regularly encountered, at least in most
Member States, on a large in the construction sector
(building and public works), also in a cross-border
context.

2.2.2. W h o a r e t h e u n d e c l a r e d w o r k e r s ?

2.2.2.1.
The Committee notes that the Commission
identifies four groups of undeclared workers as a frame
of reference:

— multiple job holders,

— ‘economically inactive’ persons,

(1) OJ C 126, 23.5.1989; OJ C 159, 17.6.1991; OJ C 49,
24.2.1992; OJ C 133, 31.5.1995; OJ C 157, 25.5.1998.

(2) OJ C 73, 9.3.1998, point 2.2.5.1.

(3) White Paper entitled ‘Growth, Competitiveness, Employ-
ment — the Challenges and Ways Forward into the 21st
Century’, COM(93) 700 final, point 8.8, paragraph 4,
indent 4.

(4) COM(1998) 219 final, point 2.2, second indent.

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— the unemployed,

— third country nationals.

terms of social security funding and the loss of tax
revenue.

2.2.2.2. However, the Committee feels it is necessary
to draw up another definition aimed at distinguishing
between those who should have employee status and
those who have decided not to declare their activities.

The vicious circle this engenders is unacceptable
because it ultimately harms declared workers and
businesses. Moreover, given that there is generally
open access to these services, it is not always possible
to identify fraudulent beneficiaries.

Such a definition would make it easier to decide on
appropriate responses.

2.3.2.

I m p a c t o n i n d i v i d u a l s

2.2.3. W h i c h

s e c t o r s

a r e

t h e m o s t

a f f e c t e d ?

2.2.3.1.
The Commission reports that traditional
sectors characterized by labour-intensive production
and local economic networks are one of the types of
activities most affected by undeclared work, especially
work and/or activities carried out at home in a family
context.

The Committee thinks that these traditional
2.2.3.2.
sectors should also include personal commercial services
(care, childcare, care of the elderly, etc.) that are not at
present a truly structured sector in terms of supply.

2.2.3.3.
The Committee also thinks that attention
should be paid to teleworking, where the conditions of
work may make it easier not to declare activities.

2.2.3.4.
to be clearer about what it calls innovative sectors.

The Committee would ask the Commission

2.2.4.

I l l e g a l

i m m i g r a n t s

The Committee thinks that even if the employment of
illegal immigrants is an issue that must be addressed in
individual Member States as part of a general strategy
to combat illegal immigration, it is nevertheless an
integral aspect of the problem of undeclared work.

The Committee therefore feels that this issue should
also be tackled at European level with the aim of
achieving more convergence.

2.3.

Impact of undeclared work

2.3.2.1.
Undeclared work places those concerned in
a more precarious
social position than declared
the lower level of social and
workers. However,
labour protection may have less serious consequences,
depending on which of the Commission’s categories
the undeclared worker falls into.

2.3.2.2.
Thus it seems that, in some cases undeclared
workers do not see their own level of social protection
as being fundamentally different from that of declared
workers. Furthermore, it should be noted that ‘highly
qualified’ undeclared workers do not appear to suffer
in this respect, since it is apparent that such people
choose to do this type of work and often enjoy quite
favourable working conditions.

2.3.2.3.
Thus the Committee observes that unde-
clared work can be very financially attractive to some
people whilst for others, and not just illegal immigrants,
it is ‘vitally’ necessary.

This may explain why people often do two jobs but
declare only one of them.

2.3.2.4.
The Committee also welcomes the Com-
mission’s view that undeclared work does not offer
consumers the same level of protection and guarantees
in terms of the quality of the goods and services
provided as declared work. However,
it should be
noted that consumers resort to undeclared work most
often as the result of a calculated decision, or indeed
need, in cases where they might not be able to obtain
the good or service concerned under normal market
conditions. This again raises the issue of labour costs.

2.3.2.5.
Finally, the Committee wishes to emphasize
how extremely unfair the situation is for people
who are paying all their taxes and social security
contributions.

2.3.1. S o c i a l

s e c u r i t y

a n d

t h e

i m p a c t

o n p u b l i c f i n a n c e s

2.3.3. E f f e c t s o n c o m p e t i t i o n

the very negative impact
The Committee notes
of undeclared work on public finances, both in

The Committee agrees with the Com-
2.3.3.1.
mission’s analysis that undeclared work has only a

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to conduct

moderate effect on international trade, given that it is
quite difficult
trade on the basis of
undeclared work. Surveillance may also be easier with
transactions.
international
Undeclared work thus
seems mainly to involve
proximity services.

than with local

trade

It

2.3.3.2.
The Committee believes that businesses
which employ undeclared labour do so only in small
fringe areas of their operations which may vary from
to
one situation to another.
mention the case of independent undeclared workers,
or groups of workers, whose activities compete directly
with the operations of registered businesses. At all
events
substantial
distortion of competition — notably in terms of the
cost of products and services — of providing a good
or service through declared or undeclared labour.

the Committee points

is also important

to the

2.3.3.3.
Although the Committee agrees that unde-
clared work affects public finances, it is also difficult
to ignore the fact that undeclared work can actually
to
distort competition in a way that
businesses that have declared their activities. Many
businesses are evidently losing markets and even face
the threat of closure as undeclared work increases.

is harmful

2.4. Policy options proposed by the Commission

The Commission considers that two types of approach
— prevention or
sanctions — can be adopted,
depending on the way the problem of undeclared work
is seen.

2.4.1. S a n c t i o n s

Sanctions are targeted at people or businesses who
take advantage of the system. The measures proposed
are:

— ensuring greater enforcement of the rules;

— favouring systems where the rights

to social
protection benefits are linked to contributions
actually made;

2.4.2. P r e v e n t i o n

Prevention consists in adapting existing legislation to
new types of work. The Commission proposes the
following measures:

— liberalization of product and service markets and
simplification of procedures for setting up small
businesses;

— promoting structured supply in certain sectors (care,
cleaning, etc.) and recognizing new occupations and
areas of responsibility;

— greater

involvement of

the social partners

in

information, enforcement and control;

— adaptation of inappropriate labour legislation to

new types of work;

— reform of social protection systems to cover short
spells of work, irregular work, people in and out
of employment, care, etc.;

— decreasing taxation on labour both for the employer

and for the worker;

— decreasing rates of VAT on labour-intensive

services (1) .

The Commission identifies two dimensions
2.4.3.
to the problem of undeclared work that call for two
types of complementary, but distinct, action:

— the issue of people taking advantage of the system
and so undermining social
solidarity, where
intervention should take the form of sanctions and
awareness-raising campaigns;

— the issue of greater labour market flexibility and
slower adaptation of existing legislation, which calls
for preventive measures (adapting inappropriate
legislation to reflect new labour market conditions)
as well as measures to reduce costs and obstacles.

2.4.4.
The Committee feels that there is a contradic-
tion in this policy approach formulated by the
Commission.

2.4.4.1.
In paragraph 4.1, the Commission calls for
‘greater enforcement of the rules’, but this is inconsistent
with its view that inappropriate labour legislation
should be adapted to new types of work.

— awareness-raising campaigns.

(1) Already proposed by Commissioner Monti.

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2.4.4.2. How can the Commission talk about the
need for basic legislation and at the same time call
that legislation into question? And on what basis does
the Commission judge existing labour laws to be
inappropriate to new activities or types of activity?

2.4.4.3. Moreover, given that all the member states
have stepped up their surveillance over the past few
years, is it enough to apply sanctions to those who
are taking advantage of the system? Can we still consider
that they bear sole responsibility for undeclared labour?

2.4.5.
The Committee does not share the Com-
mission’s opinion that adjustment and preventive
measures concern only new activities or types of
activity.

It is therefore crucially important to develop a strategy
that helps to reduce the financial gains resulting from
undeclared work.

At the same time it is also important to think about
how to structure personal services while promoting
entrepreneurial spirit, and about how to adapt certain
rules.

In this respect, the Committee feels that it would make
more sense to consider preventive measures before
sanctions, given that the Commission’s analysis of
undeclared work points up the need to adapt legislation
to economic and social conditions. It is only secondarily
that sanctions can play an effective role in combating
undeclared work.

Does this not tend to overlook the fact that nowadays
necessary adjustments should be made on a general
basis? The Commission also fails to define anywhere
what it means by ‘new forms of work’.

3.1. Preventive measures

The Committee suggests that the Commission
2.4.6.
should present the package of measures proposed in
chapter 4 in a more structured way, describing more
clearly and precisely the different measures and their
proposed level, i.e. including whether or not it proposes
measures or activities at European level.

2.4.6.1.
If it does propose European measures, the
remit of the European Community and legal basis
could be, for example:

— Article 100a (functioning of the internal market)
in order to avoid the distortions of competition
caused by undeclared work;

— and/or Articles 118 and 118a (working conditions,
health and safety of workers) in order to promote
decent working conditions.

3. Specific comments

Overall, the Committee endorses the Commission’s
analysis of the market for undeclared work.

The Committee sees undeclared work above all as the
result of inappropriate administrative provisions and
It has made this point on several
labour costs.
occasions in previous opinions.

3.1.1. L i b e r a l i z a t i o n

o f

p r o d u c t

s e r v i c e m a r k e t s
c a t i o n o f p r o c e d u r e s
u p s m a l l b u s i n e s s e s

a n d

a n d
s i m p l i f i -
s e t t i n g

f o r

The Committee has regularly championed a spirit of
enterprise and investment among SMEs and the very
small businesses that create new jobs, and in this
connection has welcomed the European Investment
Bank’s special Amsterdam action programme.

The Committee is therefore in favour of simplifying
procedures for setting up small businesses; however,
the whole legal and administrative environment for
small businesses must be improved in the spirit of the
White Paper.

The Committee has also proposed targeted training
programmes to help SMEs and very small businesses
better understand how to adapt to the Community
directives that affect them.

3.1.2. F a v o u r i n g t h e s t r u c t u r i n g o f

t h e
s u p p l y
( c a r e ,
c l e a n i n g . . . ) a n d t h e r e c o g n i t i o n
o f
c o m -
p e t e n c i e s

n e w o c c u p a t i o n s

s e c t o r s

s o m e

a n d

f o r

In almost every case, the problem of undeclared work
develops for economic reasons provoked by factors on
both the demand and the supply side.

The Committee has already expressed its support for
the proposal to improve the structure of job-creating
sectors, which are often informal, e.g. care, home help
or care, and cultural activities.

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It is essential to prevent the development of a parallel
economy and black market for labour.

fiscal,
The appropriateness of
legal,
administrative and regulatory environment
to the
situation of small businesses should be subject to a
general review.

the whole

3.1.3. G r e a t e r

i n v o l v e m e n t

s o c i a l
e n f o r c e m e n t a n d c o n t r o l

p a r t n e r s

i n

o f
t h e
i n f o r m a t i o n ,

The Committee feels that it is necessary to increase
the involvement of all the relevant social partners in
information and prevention of undeclared work.

social partners

it questions the merits of

However,
in all cases
in control
involving the relevant
measures. That said, the social partners can help to
expose illegal types of employment and, by working
together with the appropriate authorities, can help
ensure compliance with legal and collectively agreed
provisions. They can shoulder responsibilities, e.g. by
setting up bodies to deal with arbitration and internal
discipline and developing new deterrent procedures or
new surveillance mechanisms in liaison with the public
authorities.

As mentioned above, therefore, the Commission could
be more precise as to what enforcement and control
measures it advocates at sectoral, local and European
level. It should also take into account the role of other
actors and socio-economic players in the measures to
be promoted.

3.1.4. A d a p t a t i o n
l a b o u r
t h e
w o r k

l e g i s l a t i o n

e v o l u t i o n

o f

o f

i n a p p r o p r i a t e
l i n e w i t h
i n
o f

n e w t y p e s

The Committee would ask the Commission to be
more circumspect, or at least more specific, in what it
says about inappropriate labour legislation.

3.1.5. R e f o r m o f

t h e

s o c i a l p r o t e c t i o n
s p e l l s o f
s h o r t
i r r e g u l a r w o r k , p e o p l e i n
c a r e ,
e m p l o y m e n t ,

s y s t e m t o c o v e r
w o r k ,
a n d
e t c .

o u t

o f

President Delors’ white paper already introduced the
idea of better adapting social protection systems to
irregular, short-term employment. For example,
it
advocated ‘restructuring national government income
support schemes in ways which enable income from
work to be topped up with income from social security
by developing integrated taxation and income support
systems with appropriate safeguards’ (1). The declar-
ation at the Dublin Summit on employment also urged
member states to develop ‘social protection systems
capable of adapting to new patterns of work and of
providing appropriate social protection to people
engaged in such work’.

The Economic and Social Committee has also given
its opinion on this matter, calling for declared
employment to be promoted and recognized on the
basis of partnerships between the public and private
sectors in the spheres of care, transport, energy and
the environment, with the help of non-wage income
support mechanisms and accompanying safeguards
and involving the social partners, the social economy,
relevant NGOs and local and regional government (2).

However, such an approach must not pose a threat to
the market sector. The same applies to start-up firms
and other intermediary organizations.

In what sense is labour legislation more inappropriate
to new types of work than to traditional activities?
Should this question concern only new types of work?

3.1.6. D e c r e a s i n g

t a x a t i o n

o n

b o t h f o r
t h e w o r k e r

t h e

e m p l o y e r

l a b o u r
a n d f o r

Here, the Commission could do more to encourage
the social partners to discuss labour legislation in the
Member States, e.g. as it affects small businesses.

The Committee
this proposal
addresses the main cause of undeclared work.

feels

that

largely

As
the Commission communication points out,
undeclared work affects mainly small businesses, which
is why the discussion must be conducted from their
perspective. It is now clear that some small businesses
are afraid to recruit staff.

(1) White Paper entitled ‘Growth, Competitiveness, Employ-
ment: the challenges and ways forward into the 21st
century’, COM(93) 700 final, 8.8 (c) 3.
(2) OJ C 73, 9.3.1998, p. 85, paragraph 2.2.2.

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The white paper also recommended lowering or
exempting employers’ social security contributions for
less skilled, low-wage labour, with costs being offset
by compensatory measures such as environmental
taxes, excise duties on consumer products that are
damaging to health and taxes to make productive
investment more attractive (1).

The Committee’s Opinion of November 1996 on the
future of social protection (2) and its Opinion of 9 July
1997 on taxation in the European Union (3) both
advocated such alternative sources of finance.

The Committee would also like to mention another
approach, which would consist in looking at the extent
to which changing the basis for calculating social
security contributions would be an appropriate step.

Obviously such an approach must not result in secure
jobs being replaced by insecure ones, nor should it
undermine the rights of social security beneficiaries (4).

3.1.7. R e d u c i n g

r a t e s
l a b o u r - i n t e n s i v e

o f

V A T

o n

s e r v i c e s

The Committee has already said on several occasions
that it favours reducing VAT rates on labour-intensive
products, activities and services, as this may be a way
to create jobs.

The Committee reiterates its support for this initiative
which aims to boost employment and make undeclared
work less financially attractive.

Furthermore, in the conclusions of the Vienna Summit,
held on 12 December 1998, the Commission ‘is invited
to allow those Member States who so desire to
experiment with reduced VAT rates on labour intensive
exposed to cross-border
services which are not
competition (5).’

3.2. Sanctions

it. There is still the question of how far the rules must
be enforced. And what is the role of the European
Union?

If it is crucial to encourage people and businesses to
abandon undeclared work, it is just as important to
maintain or reinforce sanctions. And sometimes these
measures must include providers as much as seekers
or beneficiaries of undeclared work.

This is because undeclared work not only distorts
competition but also has effects on the legal employment
market, and on law-abiding companies and workers.
The representatives of companies and employees are
trying to improve the situation by formulating codes
of conduct and at the same time calling for tougher
sanctions.

ILO conventions form the frame of reference for joint
agreements. In terms of sanctions, the Committee
would suggest the exclusion of companies that fail to
respect their social obligations from tenders for public
procurement contracts and applying measures to ensure
chain of
social
production).

responsibility (along the whole

However, the Committee would warn the Commission
against the dangers of imposing harsh but misplaced
administrative controls, which would be harmful. It is
too often the case that substantial resources are
invested in scrutinizing declared businesses, while
to proper
undeclared activities are not
investigation.

subject

3.2.2. F a v o u r i n g
r i g h t s
b e n e f i t s
b u t i o n s

t h e
w h e r e
s y s t e m s
p r o t e c t i o n
s o c i a l
c o n t r i -
t o
l i n k e d
e f f e c t i v e l y m a d e

t o
a r e

3.2.1. E n s u r i n g g r e a t e r e n f o r c e m e n t o f

t h e

r u l e s

The Committee considers the link between contri-
butions and benefits — however tenuous — to be
crucially important.

The Committee certainly considers it important to
continue and step up enforcement, e.g. using the
customs authorities.

But can countries that now have a system of universal
social benefits revert to such a system?

The Committee is indeed expected to help ensure that
‘re-distribution of income and provision of welfare
services is valued in society’, as the Commission puts

(1) White Paper, op. cit., paragraphs 9.4 and 9.5.
(2) OJ C 66, 3.3.1997, p. 58, paragraph 5.
(3) OJ C 296, 29.9.1997, p. 37, paragraph 2.2.3, fourth

indent.

(4) OJ C 73, 9.3.1998, p. 85, paragraph 2.2.5.
(5) Presidency conclusions, SN 300/98, point 35.

The Committee would also point out that undeclared
work may involve people who are in some cases
already covered, e.g. through having two jobs, being
entitled to claim certain benefits, or being unemployed
and collecting benefit.

Finally, the problem of non-active workers who are
economically excluded from society must be better
analyzed.

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3.2.3. L a u n c h i n g
c a m p a i g n s

a w a r e n e s s - r a i s i n g

The Committee could support this proposal — even
at a political level — through the leading players it
represents. The Commission should envisage a specific
role for the social partners and other economic players
in promoting coordinated campaigns. It could also
sponsor and/or co-finance such campaigns. Likewise

the Commission should introduce the concept of
awareness-raising and prevention of undeclared work
as a method of benchmarking in the guidelines for
employment? Why was this point not raised in its
recent communication on employment(1)?

(1) Communication from the Commission — From guidelines
to action: the national action plans for employment.

Brussels, 27 January 1999.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI

Opinion of the Economic and Social Committee on the ‘Proposal for a European Parliament
and Council Regulation (EC) on orphan medicinal products’ (1)

(1999/C 101/10)

On 23 October 1998 the Council decided to consult the Economic and Social Committee,
under Article 100a of the Treaty establishing the European Community, on the above-mentioned
proposal.

The Section for Employment, Social Affairs, and Citizenship, which was responsible for
preparing the Committee’s work on the subject, adopted its opinion on 8 December 1998. The
rapporteur was Mr Colombo.

At its 360th plenary session (meeting of 27 January 1999), the Economic and Social Committee
adopted the following opinion by 121 votes to two with three abstentions.

1.

Introduction

Following a lengthy preparatory phase, the Com-
1.1.
mission has presented a draft regulation which sets out
to meet a strongly-felt need on the part of millions of
patients: to create favourable conditions at Community
level for research on and development and marketing of
medicines, known as orphan medicinal products, to
treat rare diseases.

1.2.
Patients’ associations have for years been calling
for this initiative in order to counter what is now
the unacceptable marginalization experienced by such
patients, who are denied equality in terms of a fundamen-
tal right of all citizens: the right to health.

1.3.
The proposal also comes in response to the
decision taken under the Community framework for
action in public health, which identified rare diseases as
one of the priority areas for European Union action (2).

1.4.
Given continuing medical progress — of which
medicines are an essential element — and its beneficial
effects on the quality and length of life, it is now
unacceptable that a sector of the population should be
excluded from this process.

The pharmaceutical

1.5.
spon-
taneously interested in meeting the needs of such
patients, since the profit principle which governs its
choices and programmes corresponds to market criteria.

industry is not

(1) OJ C 276, 4.9.1998, p. 7.

(2) OJ C 388, 31.12.1994; OJ C 203, 3.7.1997 — ESC opinion

in OJ C 19, 21.1.1998.