WRITTEN QUESTION E-3175/02 by Charles Tannock (PPE-DE) to the Commission. The issue of Market Economy Status for the Ukraine.
Date: 2002-11-07
Institutions: European Parliament, Provisional data
Subjects: EU control, European Commission, Ukraine, competition law, convergence criteria, economic analysis, economic reform, market economy, privatisation, transition economy

12.6.2003

EN

Official Journal of the European Union

C 137 E/169

(2003/C 137 E/192)

WRITTEN QUESTION E-3175/02

by Charles Tannock (PPE-DE) to the Commission

(7 November 2002)

Subject: The issue of Market Economy Status for the Ukraine

At the Joint Statement of the Copenhagen Summit on 4 July of this year it was confirmed that the EU is in
the process of analysing the relevant information as a prelude to determining whether or not to grant full
Market Economy Status to the Ukraine. The intention was to make a decision within six months, although
that has now been put back until March, 2003.

Could the Commission indicate the criteria on which such an assessment will be made? Will the size of the
state sector be a major determining factor or only one of a number of
factors, and how does
the Commission compare the economic situation of the Ukraine with, say, Russia or Romania? Can the
Commission give an indication of the areas of economic activity which require the greatest improvement if
Market Economic Status is to be achieved?

Finally, can the Commission offer an assurance that the decision on Market Economic Status will be made
on economic grounds alone and not on the basis of any political difficulties, the need to resolve those
difficulties notwithstanding?

Finally, as a long-term aim does the Commission regard it as important to integrate countries such as the
Ukraine (or even Russia, should she eventually indicate a wish to join) into the European Union or would
the Commission prefer them to stay outside?

Answer given by Mr Lamy on behalf of the Commission

(13 December 2002)

As the Honourable Member knows, the Union has explicitly recognised progress by Ukraine towards a
market-based system by classifying since 2000 this country as a transition economy rather than as a non-
market economy. This has allowed individual Ukrainian companies who are operating according to market
criteria to be treated as such in anti-dumping investigations, and signals the Union’s continuing support of
the on-going reforms in the Ukraine.

The Joint Statement released after the Copenhagen Summit (July 2002), stated that the Commission was
analysing whether the process of economic reform in the Ukraine was sufficiently advanced to warrant a
classification of Ukraine as a whole as a market economy for the purpose of trade defence investigations,
and that the analysis would be completed as soon as possible. Once the analysis was sufficiently advanced
to shed light on a more concrete time frame, the President of the Commission announced in September
2002 that the analysis would be completed at the latest by March 2003. This time frame is not only
transparent but also rather ambitious given the complexity of the exercise.

As was communicated to the Ukraine early 2002, such analysis is conducted on the basis of objective
criteria: degree of government influence over the allocation of resources and decisions of enterprises;
presence of State-induced distortions in the operation of enterprises linked to privatisation or carry-over
from the centralised system; existence and implementation of transparent, non-discriminatory company
law which ensures adequate corporate governance; existence and implementation of a coherent, effective
and transparent set of laws which ensure the respect of property rights and the operation of a functioning
bankruptcy regime; and existence of a genuine financial sector which operates independently from the
State and which in law and practice is subject to sufficient guarantee provisions and adequate supervision.

As can be seen from the above criteria, the assessment carefully examines not only whether the legal
structures necessary for the functioning of a market economy are nominally in place, but also whether in
practice, they are actually implemented and market principles thus apply in the operation of firms.

C 137 E/170

Official Journal of the European Union

EN

12.6.2003

The Commission performs its market economy assessment on a case-by-case analysis. Upon completion of
the assessment, the Commission intends, if necessary, to indicate to the Ukrainian authorities the areas
where it believes improvement is warranted in order for Ukraine to be treated as a full market economy in
the field of trade defence. The Commission also keeps the Ukrainian side regularly informed of progress in
the analysis.

The decision as to whether or not to graduate Ukraine into the market economy category will be made
according to economic and legal rather than political criteria. In practice, however, the extent to which an
economy can function as a market economy per se is very much dependent on the authorities’ political
will to pass and enforce the relevant laws enshrining market principles.

As to the Honourable Member’s question on the long-term strategy with Ukraine, the Partnership and Co-
operation Agreement (PCA) and the 1998 Common Strategy with Ukraine, set out the framework of
Union relations with Ukraine. On this basis, and as reiterated at the Union-Ukraine Summit in Copenhagen
on 11 July 2002, Ukraine should first take full advantage of the possibilities offered by the PCA to
facilitate two-way trade and investment and should also make all necessary efforts to accede to the World
Trade Organisation as soon as possible. The Union is supporting Ukraine in this process. Furthermore, in
the context of the enlargement, discussions are on going as to the ways to strengthen Union relations with
our future neighbours, including Ukraine.

(2003/C 137 E/193)

WRITTEN QUESTION E-3178/02

by Charles Tannock (PPE-DE) to the Commission

(7 November 2002)

Subject: Eurostat figures

In its regular Euro Indicator News Releases, Eurostat regularly publishes a wide range of useful and
informative statistics on both the Eurozone countries and the EU15. Could the Commission indicate,
however, why its Unemployment Reports only contain figures for the Eurozone countries individually and
not for all the EU15 countries individually? Could the Commission also indicate whether these reports can
be accessed on the internet by the general public?

Answer given by Mr Solbes Mira on behalf of the Commission

(6 December 2002)

The regular monthly Euroindicators News Release on unemployment always covers both the Euro-zone
(EZ) and the 15 Member States (EU15) area figures. Where the latest months are unavailable for some
countries, they are estimated to provide the European aggregate (EZ and EU15). These country estimates
are not published. The short analysis refers only to the last or second last month and the first table of the
Euroindicators News Release includes data only for the two most recent months. Where available however,
complete data including the country data for five past months can be found at
the end of each
Euroindicators News Release.

Unfortunately, even after several attempts,
it was not possible to identify a product/report headed
‘Unemployment Report’ as was mentioned in the question. If the reference is to something else other than
the above-mentioned News Release on unemployment, the Commission would need a more precise
reference to the report.