WRITTEN QUESTION P-0314/04 by Ulpu Iivari (PSE) to the Commission. Effect of EU support on the shift of jobs within the EU.
Date: 2004-02-02
Institutions: European Parliament, Provisional data
Subjects: EU aid, EU employment policy, Structural Funds, aid to undertakings, corporate social responsibility, industrial restructuring, offshoring, social impact

27.3.2004

EN

Official Journal of the European Union

C 78 E/951

In the area of education, Article 149 of the EC Treaty provides that the content of teaching and the

3.
organisation of education systems are the responsibility of the Member States.

4.
In order to safeguard cultural and linguistic diversity, which is recognised as an integral part of the
European cultural heritage, the Community acts within the limits of the powers conferred on it by the
Treaties. In application of Article 151(4) of the EC Treaty, which provides that cultural aspects must be
taken into account in all Community action, projects to promote and safeguard regional and minority
languages have been financed under existing Community actions and programmes such as Socrates and
Interreg.

5.
The rights of minorities are among the principles common to the Member States, which are listed in
Article 6 of the Treaty on European Union. These principles have been solemnly reaffirmed by the Charter
of fundamental rights of the European Union (1). Article 22 calls for cultural, religious and linguistic
diversity to be respected. It should also be noted, however, that Article 51 of the Charter provides that its
provisions are addressed to the institutions and bodies of the Union with due regard for the principle of
subsidiarity and to the Member States only when they are implementing Union law.

‘Promoting Language Learning and Linguistic Diversity’ (2), the Commission proposes
In its action plan,
measures to be taken at EU level from 2004 to 2006 in order to create a language-friendly environment.

(1) OJ C 364, 18.12.2000.
(2) COM(2003) 449 final.

(2004/C 78 E/1006)

WRITTEN QUESTION P-0314/04

by Ulpu Iivari (PSE) to the Commission

(2 February 2004)

Subject: Effect of EU support on the shift of jobs within the EU

Wärtsila Oyj, a public limited company, is transferring its engine production from Turku in Finland to
Trieste in Italy. What is happening in this case is that production and jobs are shifting from one Member
State to another. Under certain circumstances support channelled via the EU Structural Funds can also lead
to a situation in which companies are tempted to relocate production based in one EU country to another
enjoying more attractive levels of support. The overall impact of such relocation can be very considerable
in the country losing production and jobs.

1. What kind of action does the Commission believe to be necessary to ensure that, instead of causing
jobs to shift from one part of the EU to another, Structural Fund and other forms of EU support serve to
create new jobs?

2. What steps will the Commission take to harmonise protection against dismissal for employees and
the dismissal costs incurred by employers within the EU area?

Answer given by Mrs Wallström on behalf of the Commission

(3 March 2004)

1.
Job shifts from one part of the EU to another should not be seen as related to Structural Fund
interventions. Such shifts are rather linked to globalisation and differences in national policies (eg. labour
and tax legislation) and practices.

The Structural Funds aim to strengthen economic and social cohesion across the EU. In this respect,
support for job creation is an essential tool within the wide scope of financed interventions. In particular,
the European Social Fund (ESF) finances employment aids (according to Article 3.2.b of Regulation (EC)
No 1784/1999 of the Parliament and of the Council of 12 July 1999 on the European Social Fund (1)).

C 78 E/952

Official Journal of the European Union

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27.3.2004

Such aids can be granted to enterprises for job creation and for job maintenance and recruitment of
disadvantaged and disabled workers. Obviously, employment aids must be compatible with the common
market rules and with the state aid rules as defined in Articles 87 and 88 of the EC Treaty and
implemented in the Regulations concerned (e.g. Commission Regulation (EC) No 2204/2002 of
12 December 2002 on the application of Articles 87 and 88 of
the EC Treaty to state aid for
employment (2)).

The ESF also promotes entrepreneurship. ESF support to various actions, including training and guidance,
allows individuals to obtain the necessary knowledge and skills to set-up and run businesses. Support is
also offered to entrepreneurs with a view to enable them to extend their economic activities. This entails
the creation of new and better job places.

Moreover, the rule aiming at avoiding the unfair competition between the regions was introduced by
Article 30.4 of Council Regulation (EC) No 1260/1999 of 21 June 1999 laying down general provisions
on the Structural Funds (3). According to it, Member States must ensure that an operation retains the
contribution from Structural Funds only if it does not, within five years of the date of the decision
concerning Structural Funds contribution, undergo substantial modifications which could affect the nature
of the operation, its implementation conditions or give to a firm or a public body an undue advantage.
Moreover,
from a change in the nature of ownership as regards
infrastructure or from change in location in a productive activity.

the modification cannot result

2.
The Commission would like to remind the Honourable Member that several Community Directives
may apply to relocations of production with job losses. In recent years, the European Union has developed
a workers involvement policy for dealing adequately with the social consequences in cases of restructuring
of enterprises. As a result of that policy restructuring operations must be preceded by information and
consultation of employees’ representatives with the aim of avoiding or reducing its social
in
accordance with Community Directives on ‘Collective Redundancies’ (4),
‘Transfers of Undertakings’ (5),
‘European Works Councils’ (6) and, from March 2005 onwards, ‘Information and Consultation’ (7).

impact,

The Commission advocates the idea that, when restructuring, enterprises should always take into account
the effects that those decisions could have on their employees as well as on the social and regional context.
This has recently been underlined in the Commission Communication concerning Corporate Social
Responsibility (CSR) A business contribution to Sustainable Development (8).

Furthermore,
in January 2002 the Commission invited the European social partners to engage in a
dialogue on anticipating and managing change with a view to applying a dynamic approach to the social
aspects of corporate restructuring. The social partners have recently sent to the Commission the results of
their joint work on this topic. They consist of a set of reference orientations which should guide
companies and their workers when restructuring occurs. The Commission very much hopes that those
results as well as other follow-up actions contribute to disseminate throughout Europe good practices of
corporate restructuring,
thus helping companies and their workers to address adequately the social
dimension involved.

(1) OJ L 213, 13.8.1999.
(2) OJ L 337, 13.12.2002.
(3) OJ L 161, 26.6.1999.
(4) Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to

collective redundancies, OJ L 225, 12.8.1998 (This Directive consolidates Directives 75/129/EEC and 92/56/EEC).
(5) Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating
transfers of undertakings, businesses or parts of

to the safeguarding of employees’ rights in the event of
undertakings or businesses, OJ L 82, 22.3.2001.

(6) Council Directive 94/45/EC of 22 September 1994 on the establishment of a European Works Council or a
procedure in Community-scale undertakings and Community-scale groups of undertakings for the purposes of
informing and consulting employees, OJ L 254, 30.9.1994.

(7) Directive 2002/14/EC of the Parliament and of the Council of 11 March 2002 establishing a general framework for

informing and consulting employees in the European Community, OJ L 80, 23.3.2002.

(8) COM(2002) 347 final.