WRITTEN QUESTION E-4027/03 by Geoffrey Van Orden (PPE-DE) to the Commission. Capital gains tax deductions.
Date: 2004-01-09
Institutions: European Parliament, Provisional data
Subjects: France, capital gains tax, freedom to provide services, real property, tax relief

8.4.2004

EN

Official Journal of the European Union

C 88 E/481

How will the Commission ensure that a fully operational internal market in the field of electricity networks
does not render operations increasingly unreliable?

(1) OJ L 176, 15.7.2003, p. 37.

Answer given by Mrs de Palacio on behalf of the Commission

(6 February 2004)

The issue of security of supply is a crucial issue for the successful operation of the internal market. This
applies equally for the maintenance and the increase of public service levels and the protection of
vulnerable customers. These issues are, therefore, given great emphasis in the new Electricity Directive
2003/54/EC (1), which requires Member States to monitor the demand/supply balance in their electricity
systems and to provide for the necessary fall back mechanisms which they can use should the market not
be able to guarantee security of supply.

Member States are now implementing this Directive into their national legislation. The Commission will
evaluate whether they have complied with their obligations on these issues when national legislation is
notified to it. Should a Member State fail to implement the Directive correctly, the Commission will
commence an infringement procedure. However,
the Commission expects that Member States will
faithfully transpose the Directive. The Commission will in any event carry out a process of benchmarking
and comparison of the approaches taken by Member States to promote best practice among the Member
States.

Furthermore, on 10 December 2003 the Commission published a proposal for a Directive concerning
measures to safeguard security of electricity supply and infrastructure investment (2). This proposal intends
to ensure that Member States have a clear security of supply policy established in advance to ensure
regulatory stability and a clear apportioning of responsibilities. In addition, it seeks to guarantee that the
necessary investments in cross border infrastructure will be made to ensure both security of supply and the
full development of competition throughout the internal market.

(1) Directive 2003/54/EC of the Parliament and of the Council of 26 June 2003 concerning common rules for the
internal market in electricity and repealing Directive 96/92/EC (cid:1) Statements made with regard to decommissioning
and waste management activities.

(2) COM(2003) 740 final.

(2004/C 88 E/0494)

WRITTEN QUESTION E-4027/03

by Geoffrey Van Orden (PPE-DE) to the Commission

(9 January 2004)

Subject: Capital gains tax deductions

In calculating capital gains tax to be paid on the proceeds of selling a domestic property, in France the cost
of improvements to the property can be deducted from the total tax payable.

Does this still apply if the work to improve the property is carried out by a British firm and paid for in UK
Sterling?

Answer given by Mr Bolkestein on behalf of the Commission

(10 February 2004)

This question is a matter for the French Government and not
for the Commission. There is no
harmonisation of direct taxes within the European Union and Member States are free to establish their
own tax laws (cid:1) provided, of course, that they comply with the fundamental freedoms guaranteed by the
Treaty creating the European Union.

C 88 E/482

Official Journal of the European Union

EN

8.4.2004

One such freedom relates to the provision of services. A tax rule that denied a deduction for the cost of
work carried out by a business established in another Member State would appear to give rise to
discrimination based on the nationality or place of residence of the service provider. As such, it would be
likely to constitute an infringement of the EC treaty. However, the Commission has no reason to believe
that such a rule might exist in France.

(2004/C 88 E/0495)

WRITTEN QUESTION E-0008/04

by Philip Claeys (NI) to the Commission

(16 January 2004)

Subject: Accession of Cyprus, immigration

Following the recent elections in the Turkish part of Cyprus, opposition parties are expressing concern
about the massive registration of Turkey citizens on electoral rolls. There are very close links between
‘President’ Rauf Denktash (and his political supporters) and Turkey. This may lead to a whole range of
problems after Cyprus’s accession. For instance, there is a very real danger that the part of Cyprus occupied
by Turkey will be exploited as a transit zone to allow Turks to emigrate to other EU Member States,
circumventing the immigration ban applied by most Member States of
the European Union. The
government of Cyprus is, after all, encouraging the free movement of people throughout the whole island.

What measures is the Commission considering to tackle this potential problem? Have discussions already
taken place with the authorities in Cyprus on this matter?

Answer given by Mr Verheugen on behalf of the Commission

(4 March 2004)

Cyprus is de facto divided by a United Nations (UN) buffer zone. This dividing line between the Northern
part and the Government Controlled Areas can be crossed only at four crossing points.

The policy of the Republic of Cyprus only allows the crossing of the line by all citizens of the Republic, EU
citizens and third country nationals who are legally residing in the northern part, and EU citizens and third
country nationals who entered the island through the Government Controlled Areas. Thus third country
nationals who entered through the northern part are not allowed to cross to the Government Controlled
Areas.

In the case of a solution before 1 May 2004, the issue would be addressed in the Annan plan which would
serve as a basis for more detailed rules to be established by the European Union.

In the case of no solution by 1 May 2004, Article 2 of Protocol No 10 of the Act of Accession foresees
that the Council shall decide on the terms under which persons will be able to cross the line. On the basis
of this Article, the Commission shall prepare a proposal for a Council Regulation.

There is no risk of illegal immigration via Cyprus into the other Member States, because the new Member
States will be only gradually integrated into the Schengen area.