WRITTEN QUESTION E-3096/02 by Brice Hortefeux (PPE-DE) to the Commission. Financial control.
Date: 2002-10-28
Institutions: European Parliament, Provisional data
Subjects: audit, business ethics, consultancy, control of restrictive practices, merger control, oligopoly

10.7.2003

EN

Official Journal of the European Union

C 161 E/65

forestry companies receive no state aid for their investments and they therefore maintain that the German
state aid is distorting competition on the internal market.

Does the Commission consider that, if it approves the launch of other forest industry projects in the future
with the aid of taxpayers’ money, there is a risk of damaging Swedish companies in that industry?

Answer given by Mr Monti on behalf of the Commission

(27 November 2002)

In June 2002 the Commission authorised aid to Zellstoff Stendal for the construction of a new pulp mill.
Investment costs amounted to some EUR 800 million. The aid amounts to around EUR 250 million.

The project is located in Eastern Germany, which is considered to be one of the less developed regions in
the Community. In these regions aid can be granted up to a level fixed by the Commission in order to
promote the economic development of these regions by supporting investment and job creation.

The project of Zellstoff Stendal has been approved on basis of the multisectoral framework on regional aid
for large investment projects. In assessing the compatibility of the aid under the multisectoral framework,
the Commission has also to take into account the capacity and market situation in the industry. This is
done by looking at the capacity and market situation and development over the last five years. In the
Stendal case the Commission found that the pulp sector did not suffer from over-capacities.

If another project in the same sector will be notified to the Commission by a Member State before
31 December 2003, the Commission will assess this project on its own merits, considering, in line with
the actual multisectoral framework rules, the capacity and market situation at the time the project will take
place, but also the regional impact of the project. If the project is notified after the 1 January 2004, the
new multisectoral rules will apply.

(2003/C 161 E/069)

WRITTEN QUESTION E-3096/02

by Brice Hortefeux (PPE-DE) to the Commission

(28 October 2002)

Subject: Financial control

The Enron scandal highlighted the fragility of financial stability and the interrelation between this and
audit firms in the USA and Europe.

For some years now, the number of large audit firms has been steadily decreasing. The upshot of this
structural change has been to limit the choice of large companies or multinationals looking for such a
firm.

The choice of a reliable audit firm has therefore become a major issue. The limited number of players in
the field of financial management control (there are only four such companies in the USA) is also a cause
for concern because, as the Enron episode has shown, there is an attendant risk of this situation
undermining the stability of the financial markets, which have already been weakened by a series of crises.

Over 80 % of the EU’s 100 largest undertakings in Belgium, France, Italy, the United Kingdom and the
Netherlands call on the services of just four audit firms. This trend is clearly anticompetitive and tends
towards monopolisation of the world market by a few large specialist firms.

Will the Commission act to counter this negative trend, which greatly endangers the stability of the
markets, and what measures will it propose under Articles 81 and 82 of the EC Treaty?

C 161 E/66

Official Journal of the European Union

EN

10.7.2003

Answer given by Mr Monti on behalf of the Commission

(16 December 2002)

Following the Enron scandal, Andersen ceased to operate as a global company and Andersen partners in
the Union sought to join one of the other four large accounting firms (i.e KPMG, PricewaterhouseCoopers,
Deloitte & Touche Tohmatsu and Ernst & Young). The arrangements that were negotiated varied from one
Member State to another.

Only three of the mergers that were agreed in the Community fell within the scope of the Community
Merger Regulation (1), these being the transactions that took place in Germany, France and the United
Kingdom. The investigation carried out in these cases confirmed that the large five accounting firms served
a distinct market for large and international firms which would in any case have recourse to the big
accounting firms with an international network only. Thus the local Andersen companies, deprived of the
network, were no longer able on their own to keep their large customers, and the mergers, in themselves,
would not contribute to the possible worsening of competition resulting from the loss of one of the Big
Five auditors. No significant concerns regarding competition in this market were raised by customers
during the investigation. Thus the three transactions were cleared by the Commission (2). Other
transactions were scrutinised by the national competition authorities of the Member States concerned and
were eventually cleared.

The Commission is not aware of grounds for intervention in this sector on the basis of articles 81 and 82
of the EC Treaty. The Commission shares the concerns of the Honourable Member on the structure of the
industry, and will continue to pay close attention to this industry and in particular to possible regulatory
developments emerging from the recent scandals.

(1) Council Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between

undertakings, OJ L 395, 30.12.1989.

(2) M.2810 Deloitte & Touche/Andersen UK, Art. 6(1)(b) decision on 1 July 2002 M.2824 Ernst & Young/Andersen
Germany Art. 6(1)(b) decision on 27 August 2002M.2816 Ernst & Young/Andersen France, Art. 6(1)(b) decision on
5 September 2002 http://europa.eu.int/comm/competition/mergers/cases/index/by_cy_a.html#an_.

(2003/C 161 E/070)

WRITTEN QUESTION E-3105/02

by Erik Meijer (GUE/NGL) to the Commission

(29 October 2002)

Subject: Export of radioactive waste from EU countries as an important source of income for Serbia during

and after the Milosevic period

1.
Is the Commission aware of the reports made by the Serbian citizens Nada Ajdacic, Bozidor
Bogdanovic and Ilic Sibin that EU Member States have been exporting nuclear waste to Serbia since 1989
or even earlier, and that this trade in radioactive waste was even the main source of foreign earnings
during the Milosevic regime as EUR 1 500 per kilo was paid?

2.
Is the Commission also aware that these imports were and are being arranged through the Serbian
company Eastpoint, owned by Zoran Drakulic, which cooperates with Marc Rich, an oil and metals dealer,
whose speciality was to arrange trade with isolated States such as South Africa at the time of apartheid and
Iran under the ayatollahs?

Did it come to the Commission’s attention in any way that during the period in which trade with
3.
and transport to Serbia was restricted, the importation of radioactive material nonetheless took place via
the Montenegrin harbour of Bar, from where the consignments continued by train to the Danube and
subsequently along the Romanian border by water to Kladovo at the Iron Gate dam, and that the then
mayor of Kladovo, Mr Sibin, refused to accept a consignment of nuclear waste from a German firm but the
consignment went through despite his opposition?