Opinion of the European Economic and Social Committee on the "Proposal for a Decision of the European Parliament and of the Council establishing a general framework for financing Community actions in support of consumer policy for the years 2004-2007" (COM(2003) 44 final — 2003/0020 (COD))
Date: 2003-07-17
Institutions: European Economic and Social Committee
Subjects: EU policy, consumer protection

C 234/86

EN

Official Journal of the European Union

30.9.2003

Opinion of the European Economic and Social Committee on the ‘Proposal for a Decision of the
European Parliament and of the Council establishing a general framework for financing
Community actions in support of consumer policy for the years 2004-2007’

(COM(2003) 44 final — 2003/0020 (COD))

(2003/C 234/19)

On 12 February 2003 the Council decided to consult the European Economic and Social Committee,
under Article 308 of the Treaty establishing the European Community, on the above-mentioned proposal.

The Section for the Single Market, Production and Consumption, which was responsible for preparing
the work on the subject, adopted its opinion on 25 June 2003. The rapporteur was Mr Hernández
Bataller.

At its 401st Plenary Session of 16 and 17 July 2003 (meeting of 17 July), the European Economic and
Social Committee adopted the following opinion by 94 votes in favour, four votes against and one
abstention.

1.

Introduction

The essential aim behind the general framework for
1.1.
Community activities in favour of consumers, established by
Decision No 283/1999/EC of 25 January (1), was to group
together all initiatives carried out for the benefit of consumers
so as to optimise their effects for consumers, whilst taking
account of the initiatives adopted by the Community and the
support provided to those organisations and bodies which
work to defend consumer interests at Community and national
level.
It was adopted to meet the immediate need for a
legal framework for expenditure on consumer protection in
accordance with the judgement of the European Court of
Justice of 1998 (case 106/96) (2).

This Decision pursued the aim of strengthening those
1.2.
organisations and bodies active in the area of consumer
protection so that they could be a more effective driving force
in raising consumer awareness. It set out the arrangements for
the financial support provided by the Community to such
organisations and bodies with the aim of ensuring maximum
transparency and effectiveness in the use of the funds allocated
by the Community.

In its opinion on the previous proposal (3), the Com-
1.4.
mittee expressed its agreement with the Commission’s reason-
ing and its support for the proposed framework, provided
explicit reference was made to the planned action to be
undertaken. The Committee also suggested leaving sufficient
room for the introduction of a new basic act to earmark new
financial provisions in order to take appropriate action in the
case of events in areas not covered by this framework.

The Commission drew up a report in 2001 (4) in which
lessons, taking account of the

1.5.
it outlined three principal
experience gained over the previous years:

— the benefits of flexibility in implementing the action plan;

— the need to adopt a more strategic approach to EU

consumer policy;

— the importance of effective integration of a consumer

dimension in all relevant EC policies.

1.3.
This Decision provided the first legal framework for
expenditure on activities in several areas of health and
consumer protection. It expires on 31 December 2003.

Recently, the Commission drew up an evaluation
1.5.1.
report (5) in which it concluded that any future legal framework
for expenditure in favour of consumers should contain a better

( 1) Decision No 283/1999/EC of the European Parliament and of the
framework for
Council of 25.1.1999 establishing a general
Community activities in favour of consumers. OJ L 34 of
9.2.1999.

( 2) This judgement stipulates that implementation of Community
expenditure relating to any significant Community action presup-
poses not only the entry of the relevant appropriation in the
budget of the Community, ... but in addition the prior adoption
of a basic act authorising that expenditure.

(3) OJ C 235 of 27.7.1998.
(4) Report from the Commission on the ‘Action Plan for Consumer
Policy 1999-2001’ and on the ‘General Framework for Com-
munity activities in favour of consumers 1999-2003’, COM(2001)
486 final.

(5) Report from the Commission to the European Parliament and the
Council on the implementation and evaluation of Community
activities 1999-2001 in favour of consumers under the General
Framework as established by Decision (EC) No 283/1999.
COM(2003) 42 final.

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alignment of policy and budgetary frameworks and should
take account of important shifts in the policy context, such as
enlargement and new governance, and the adoption of the
new Consumer Policy Strategy.

proposal establishes a direct link between the objectives and
priorities of the Consumer Policy Strategy 2002-2006 and the
actions to be financed under the proposed Decision. The legal
basis for the proposal is Article 153 of the EC Treaty.

In May of 2002, the Commission issued the ‘Consumer
1.6.
Policy Strategy 2002-2006’ (1), which comprised three essen-
tial objectives: a high common level of consumer protection;
effective enforcement of consumer protection rules and proper
involvement of consumer organisations in Community policy
making. The following are some of the key factors underlying
the strategy: prioritising the integration of consumer interests
into other EU policies, maximising the benefits of the internal
market for consumers, and preparing for enlargement. The
Committee has already issued an opinion (2) on this strategy,
expressing its satisfaction and support for more effective
implementation of the existing legislation and advocating the
integration of consumer policy in other relevant policy areas,
including education. The Council (3) for its part urged the
the
Commission and the Member States to ensure that
proposal for a future legal act for Community activities in
favour of consumers reflects and supports the objectives
outlined in the Commission strategy.

2. Content of the Proposal

The aim of the proposal is to establish an enabling
2.1.
framework for the Community actions in support of consumer
policy set out in the Consumer Policy Strategy 2002-2006,
adopted by the Commission in May 2002, which establishes
the following objectives:

2.3.
The scope of this proposal covers issues concerning
consumer safety related to non-food products, consumer
economic interests, consumer information and education, the
promotion of consumer organisations at European level and
their contribution to EU policies affecting consumer interests.

The proposal covers the four-year period from 2004 to
2.4.
2007. The total budget proposed for the four-year period
amounts to EUR 72 million, or EUR 18 million per year, in
operational credits and EUR 32 million, or EUR 8 million per
year, in human resources and other administrative expenditure.
This is intended to create budgetary stability for consumer
policy actions.

2.5.
Only specific projects that support the objectives of
the Consumer Policy Strategy and fall within the following
areas will be eligible for co-financing:

— protection of consumer health and safety with respect to

services and non-food products;

— protection of the economic interests of consumers;

— high common level of consumer protection,

— promotion of consumer information and education;

— effective enforcement of consumer protection rules,

— promotion of consumer organisations at European level.

— proper involvement of consumer organisations in Com-

munity policy making.

2.2.
These objectives will be implemented through actions
included in the rolling programme (annexed to the Strategy)
which will be regularly reviewed by the Commission. This

( 1) Communication from the Commission to the European Parlia-
ment, the Council, the Economic and Social Committee and the
Committee of the Regions. COM(2002) 208 final.

( 2) OJ C 95 of 23.4.2003
( 3) Council Resolution of 2.12.2002 on Community consumer policy

strategy 2002-2006, OJ C 11 of 17.1.2003.

With the aim of extending both the size and duration of the
projects financed, it is planned to issue a call for proposals at
the least every two years.

2.6.
The proposal does not incorporate selection and award
criteria for the financing of specific projects. These are, instead,
set out in an annual work programme to be presented to the
‘Advisory Committee’ responsible for assisting the Commission
in implementing the proposed Decision. In line with subsidiar-
ity, co-financing of specific projects will no longer be used as
an instrument to provide support to smaller-scale national
consumer organisations. Instead, the Commission will directly
finance projects that support and promote consumer organis-
ations through staff training and exchanges of best practices.

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2.7.
The proposal modifies the eligibility criteria for finan-
cial contributions to European consumer organisations in
order to clarify that they must be independent of industry,
commerce and other business interests, and that their primary
objective must be to promote the health, safety and economic
interests of European consumers.

assistance to consumers to help them exercise their rights
and to obtain access to appropriate dispute resolution;

— actions to be developed in the area of administrative and
enforcement co-operation with the Member States.

2.7.1.
The proposal provides for different forms of budget-
ary support based on varying levels of Commission partici-
pation and funding percentages:

2.9.
The proposal also contains rules on publication, moni-
toring, and evaluation, implementation of measures, and the
assistance to be provided to the Commission by an advisory
committee.

2.7.2.
Projects implemented directly and financed 100 %
by the Commission, carried out through the award of contracts.
These projects will cover areas such as:

— advice, analysis, expertise and preparation of technical,
legal and socio-economic proposals aimed at the protec-
tion of consumers;

— monitoring and assessing consumer protection standards,
including the creation of databases and other IT tools;

— providing support to consumer organisations in the form
of technical and legal expertise, staff training, consumer
information and education, and developing initiatives in
this area.

Co-financing of specific projects run at Community or
2.8.
national
level by any legal person or association of legal
persons acting independently of commerce and industry. The
financial support available here amounts to between 50 % and
70 % of the costs of the implementation of the project.

2.8.1.
Financial contributions for the functioning of Euro-
pean consumer organisations in accordance with the defi-
nitions provided in the proposed Decision. This category of
financial support is capped at 50 % of all administrative
expenditure, although up to 95 % of costs incurred by
organisations that protect
the interests of consumers by
developing standards applicable to products and services
Community-wide may be financed. This latter measure is
explained by the significant political relevance and ‘general
European interest’ of standardisation.

2.8.2.
The proposal also introduces specific provisions for
actions undertaken and financed jointly by the Commission
and the Member States and consisting of:

— financial contributions to bodies that are part of existing
Community networks set up to provide information and

3. General comments

The Committee agrees with the Commission that the
3.1.
creation of a general
legal framework for the financing of
Community actions in favour of consumer policy based on
the principles of unity, sound financial management and
budgetary transparency is a necessity.

3.2.
The Committee welcomes the Commission’s desire to
enhance the effectiveness of these actions and to tailor them
more closely to objectives on the basis of an ex ante evaluation
of the Consumer Policy Strategy 2002-2006 and an ex post
evaluation of the implementation of Decision No 283/1999/
EC. Sound financial management must be based on the
principles of economy, efficiency and effectiveness and con-
firmed through the use of measurable effectiveness indicators,
related to the activity in question, so that the results can be
assessed. The Committee advocates a system of ex ante and ex
post assessments to be carried out by the institutions in
accordance with the new general financial framework.

3.3.
Given that expenditure related to food safety is to be
financed independently, as outlined in the White Paper on
Food Safety and Regulation (EC) No 178/2002, it would seem
logical for initiatives concerning foodstuffs to be left out of the
scope of the present proposal.

The Commission believes that the annual project cycle
3.4.
on which the framework is based has been shown to be highly
costly both for the Commission and the applicants and that as
such it diminishes the Community added value and long-term
impact of the projects financed. In the light of this, the decision
has been taken to issue a call for projects at least every two
years. Nonetheless, it must be made clear that the introduction
of a two-year project cycle in principle and a call for proposals
every two years at least does not imply that the projects
financed must have a duration of two years. This would be
excessively rigid in view of the ever-changing nature of the
market.

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3.5.
The Commission has proposed a total budget for
2004-2007 of EUR 72 million, or EUR 18 million per year, in
operational credits and EUR 32 million, or EUR 8 million per
year, in human resources. The Commission does recognise,
however, the concern expressed by the experts consulted in
the ex ante evaluation with respect to the adequacy of the
programme of action proposed. In view of this, it would be
advisable not only to ensure a more effective use of resources,
but also to provide additional funding for human resources, in
particular given that the new Member States will also be in line
for financing during that period. Third countries, whether
EFTA/EEA countries or other states which have bilateral
agreements with the EU, may also benefit insofar as they have
contributed to the budget. In terms of the participation of the
new Member States, the financial perspective for enlargement
is currently being adapted,
increasing the funds available
within the financial framework by approximately 2,5 million
EUR per annum.

3.6.
In its proposal the Commission pledges its support to
associations working at European level, which are the only
organisations eligible for operational subsidies. The Committee
notes that in reality only one organisation will be awarded this
type of subsidy and believes that the Commission should be
more flexible and amend this definition to enable other well-
established consumer protection organisations to continue to
from operational subsidies. This would ensure in
benefit
practice that the strongest, most powerful associations do not
take advantage of the actions financed within the framework.

should be clarified. In this respect, the Committee notes that
the budget must be based on the principle of efficiency, i.e. the
means used must match the results obtained as closely as
possible; the Commission must not lose sight of this, given
its ultimate responsibility for budgetary implementation in
accordance with Article 274 of the Treaty.

It is important to distinguish the size and resources
3.7.1.
of the organisations, whether they operate at national or
Community level and the ‘Community interest’ of
their
proposals. A variety of areas are of great strategic importance
for European consumers,
including the new technologies,
electronic communication, self-regulation and co-regulation,
general
interest actions, new financial services, etc. Within
these areas, specialist organisations that work to protect
consumers’ rights can provide essential added value, indepen-
dently of their organisational strength and the scale of their
operations.

3.7.2.
The Committee considers that the role of the Com-
mission in coordinating Community projects carried out
within different Member States must be maintained and indeed
reinforced. Examples have shown, over and above the concrete
assessment of their circumstances and results, that organis-
ations can combine action at national level with activities that
provide added value at the European level provided the
Commission acts as coordinator.

The Committee thus proposes the following defi-
3.6.1.
‘Non-govern-
nition of ‘European Consumer Organisation’:
mental, non profit-making organisation which has amongst its
main objectives the promotion and protection of consumers’
interests and health by working for their defence, interest and
representation and to provide information, training and advice
and take initiatives in their interests. It shall have member
organisations in most of the Member States and shall be
mandated by them to represent the interests of consumers at
Community level.’

3.7.3.
Article 7 of the proposal establishes the beneficiaries,
with paragraphs 2 and 3 providing two different definitions of
European consumer organisations. Although this can be
explained in terms of the varying objectives of the subsidies
provided and the strategic interest of standardisation projects,
problems could arise as a result of
the use of differing
definitions. Therefore it would be desirable to agree a single
definition as described in 3.6.1 above.

The Committee asks the Commission to ensure
3.6.2.
that the criteria relating to representation on the Consumer
Committee do not become dependent on the criteria used to
grant funding.

The EESC calls on the Commission, the Member
3.7.4.
States and consumer organisations to consider how people
with disabilities might play an active role in consumer policy.

3.7. Whilst the Committee agrees with the overall aim
of strengthening the European framework for consumer
protection and organisations that work to protect consumer
it feels that this approach to operational subsidies
rights,

3.7.5.
The Committee finds it strange, against the current
background of European integration, that no requirement is
placed on these organisations to operate in a democratic and
transparent manner and to make their organisational data
available to the public.

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3.7.6.
The Committee notes that the proposed Decision
deals with the period 2004-2007 whilst the related consumer
policy strategy covers the period 2002-2006. Whilst it under-
stands the internal reasons cited by the Commission for this,
the time discrepancy could create problems in the future.

In terms of

3.8.
the co-financing of specific projects
that support the consumer policy objectives outlined under
point 2.1 and are run by legal persons or associations of legal
persons that act
independently either at Community or
national level, it would seem clear that these projects can be
developed either at Community or national level and that the
financing can be granted to any person or association that
meets with the independence criterion even where they are
not represented at European level.

The Committee considers that, when granting finan-
3.8.1.
cing, priority should be given to cross-border actions and
those based on co-operation between different associations in
various Member States. Given that cooperation between
consumer organisations in different Member States can be
problematic, the Commission should seek out appropriate
measures to remedy this.

3.8.2.
The EESC also feels that, in terms of co-financing,
great store must be set by projects that aim to provide
information to consumers.

3.8.3.
The Commission should support the priority for
financing given to specific projects which are of strategic
importance and comply with the consumer policy aims. It
should not be forgotten that in a great many cases such
projects are based on new activities that require additional
human and technical resources over and above the organis-
ation’s existing resources.

Brussels, 17 July 2003.

3.8.4. More generally, the Committee finds it unusual that
the support for the co-financing of specific projects cannot
also attain 95 % of eligible project implementation costs where
the significance and scale of the project would require this.
Experience has shown that partial subsidies force consumer
organisations to look for other sources of financing for their
projects and that this financing is subject to severe restrictions,
thereby limiting their ability to present new initiatives.

3.9.
The Committee agrees with the Commission that the
principle of transparency must be applied to the planned
publication, monitoring and evaluation measures. With this in
mind, it considers that greater efforts must be made when
submitting the proposals and the list of beneficiaries to the
consumer organisations to use all possible communication
methods available to the Commission, both electronic and
through the Official Journal.

3.10.
The proposal provides for the creation of an advisory
committee set up to assist the Commission. The Committee
would remind the Commission that it is bound to provide
adequate justification for the type of committee chosen (1) and
its makeup.

The Committee would remind the Commission of
3.11.
the need to set aside public money under the new post-2006
financial perspective for the creation of a European research
body for the protection of consumer rights. The EESC awaits
the Commission’s proposal with interest.

(1) Judgement of the Court of Justice of 21.1.2003, case C-378,
Commission versus the European Parliament and the Council,
section 63.

The President

of the European Economic and Social Committee

Roger BRIESCH