Proposal for a DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the mobilisation of the European Globalisation Adjustment Fund in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management (application EGF/2012/008 IT/De Tomaso Automobili from Italy)
Date: 2013-06-28
Institutions: European Commission
Subjects: European Globalisation Adjustment Fund, Italy, collective dismissal, commitment of expenditure, employment aid, general budget (EU), motor vehicle industry, payment appropriation, reintegration into working life













EUR-Lex - 52013PC0469 - EN











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52013PC0469

Proposal for a DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the mobilisation of the European Globalisation Adjustment Fund in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management (application EGF/2012/008 IT/De Tomaso Automobili from Italy) /* COM/2013/0469 final - 2013/ () */









EXPLANATORY MEMORANDUM
Point 28 of the Interinstitutional
Agreement of 17 May 2006 between the European Parliament, the Council and the
Commission on budgetary discipline and sound financial management[1] allows for the mobilisation of
the European Globalisation Adjustment Fund (EGF) through a flexibility
mechanism, within the annual ceiling of EUR 500 million over and
above the relevant headings of the financial framework.
The rules applicable to the contributions
from the EGF are laid down in Regulation (EC) No 1927/2006 of the European
Parliament and of the Council of 20 December 2006 on establishing the European
Globalisation Adjustment Fund[2].
On 5 November 2012, Italy submitted application EGF/2012/008 IT/De Tomaso Automobili for a financial contribution from
the EGF, following redundancies in De Tomaso Automobili S.p.A. in Italy.
After a thorough examination of this
application, the Commission has concluded in accordance with Article 10 of
Regulation (EC) No 1927/2006 that the conditions for a financial contribution
under this Regulation are met.
SUMMARY OF THE APPLICATION AND ANALYSIS
 Key data: ||   
 EGF Reference no. || EGF/2012/008 
 Member State || Italy 
 Article 2 || (a) 
 Primary enterprise || De Tomaso Automobili S.p.A. 
 Suppliers and downstream producers || 0 
 Reference period || 5.7.2012 – 28.8.2012 
 Starting date for the personalised services || 15.1.2013 
 Application date || 5.11.2012 
 Redundancies during the reference period || 1 030 
 Redundancies before and after the reference period || 0 
 Total eligible redundancies || 1 030 
 Redundant workers expected to participate in the measures || 1 010 
 Expenditure for personalised services (EUR) || 4 987 732 
 Expenditure for implementing EGF[3] (EUR) || 201 613 
 Expenditure for implementing EGF (%) || 3,89 
 Total budget (EUR) || 5 189 345 
 EGF contribution (50 %) (EUR) || 2 594 672 
1.           The application was
presented to the Commission on 5 November 2012 and supplemented by additional
information up to 5 March 2013.
2.           The application meets the
conditions for deploying the EGF as set out in Article 2(a) of Regulation (EC)
No 1927/2006, and was submitted within the deadline of 10 weeks referred to in
Article 5 of that Regulation.
Link between the redundancies and
major structural changes in world trade patterns due to globalisation
3.           In order to establish the
link between the redundancies and major structural changes in world trade
patterns due to globalisation, Italy argues that globally, car production
increased by 22,4 % in 2010 (after a 9,6 % downturn in 2009[4]). In total, 58,3 million cars
were manufactured in 2010. The EU was the biggest producer, accounting for
26 % of world car production, while the second biggest, China, produced 13,9 million units. Chinese car production increased by 33,8 % in 2010
while car production in Europe grew by only 8,3 %. In the same year
(2010), Japan, the world’s third largest producer, manufactured 21,1% more cars
than in 2009, followed by South Korea (+22,4 %), Brazil (+9,8 %),
India (+29,4 %) and the US (+24,4 %). These figures make it clear
that growth in automobile manufacturing in the EU lags well behind that of its
major competitors, thus leading to a loss of EU market share in the sector.
4.           The applicant further
refers to European motor vehicle production statistics[5] to demonstrate a decrease of
the EU market share between 2004 and 2010. The EU-27 market share in the world
production of motor vehicles decreased from 28,4 % in 2004 to 26,3 %
in 2010. In the same period, the production of passenger cars, in absolute
terms, increased by 6,7 % in the EU-27, against a growth rate of
32,2 % worldwide. This decrease in EU market share is part of a longer
trend, as has been stated by the Commission in its assessments of previous EGF
automotive cases based on trade related globalisation (in 2001, the EU-27 share
in world car production was still 33,7 %). The declining share of the
European market as a proportion of the world market for passenger cars is also
borne out by the Cars 21 final report, published on 6 June 2012[6]. The main driving force of this
redistribution of world market shares are the geographical patterns of
consumption, in particular the rapid growth in Asian markets which EU producers
are less able to benefit from, being traditionally less well positioned on
these markets than elsewhere. 
5.           To date, the automotive sector
has been the subject of the most numerous EGF applications, with 16 cases, of
which seven[7]
are based on trade related globalisation.
Demonstration of the number of
redundancies and compliance with the criteria of Article 2(a)
6.           Italy submitted this application
under the intervention criteria of Article 2(a) of Regulation (EC) No
1927/2006, which requires at least 500 redundancies over a four-month period in
an enterprise in a Member State, including workers made redundant in its
suppliers and downstream producers.
7.           The application cites 1 030
redundancies in De Tomaso Automobili S.p.A. during the reference period from 5
July 2012 to 28 August 2012. All of these redundancies were calculated in
accordance with the third indent of the second paragraph of Article 2 of
Regulation (EC) No 1927/2006. The Commission has received the confirmation
required under the third indent of the second paragraph of Article 2(2) that
this is the actual number of redundancies effected.
Explanation of the unforeseen nature of
those redundancies
8.           The Italian authorities report
that De Tomaso S.p.A. is an automobile manufacturer founded in 1959 by the
engineer and race car driver Alejandro De Tomaso. After four years
manufacturing racing cars the enterprise shifted the production towards
sports cars and in the early 70s De Tomaso developped the Panther, a car which
gave him international fame and remained in production for two decades. Later
on a new line of production (luxury cars) was introduced.
9.           In 2009 the heirs of de Tomaso
and the shareholders ceded the brand De Tomaso to the Innovation in Auto
industry S.p.A. (IAI S.p.A.). Following this agreement, the IAI changed its
name to De Tomaso Automobili S.p.A. The new Di Tomaso purchased part of the
Pininfarina S.p.A.(a company operating primarily in the areas of industrial
design and sustainable mobility) and 900 former Pininfarina workers joined the
De Tomaso workforce, as part of a plan that provided for the production of
aluminium cars with innovative technology.
10.         In 2011 De Tomaso
Automobili SpA presented their new vehicle, the De Tomaso Deauville 2011, at
the Geneva Motor Show. 
11.         As reported in the press[8] the high-end-luxury auto market
is not facing the severity of downturn that is hitting mass-market car manufacturers,
but neither is growing in the way expected in 2011.
12.         The feeble growth combined
with the general difficulties encountered by the automotive sector together
with the tightening of credit that followed the economic and financial crisis
put an extra burden on the enterprise which could not work out a profitable
solution and entered into liquidation proceedings in April 2012. In July 2012
the Livorno and the Torino courts declared the enterprise bankrupt.
Identification of the dismissing
enterprises and workers targeted for assistance
13.         The application relates to 1 030
redundancies in de Tomaso Automobili S.p.A, of which 1 010 are expected to
participate in the measures.
14.         The break-down of the
workers expected to participate in the measures is as follows:
 Category || Number || Percent 
 Men || 890 || 88,12 
 Women || 120 || 11,88 
 EU citizens || 978 || 96,83 
 Non EU citizens || 32 || 3,17 
 15-24 years old || 0 || 0,00 
 25-54 years old || 898 || 88,91 
 55-64 years old || 112 || 11,09 
 > 64 years old || 0 || 0,00 
15.         Seven of the targeted
workers have longstanding health problems or disability.
16.         In terms of occupational
categories, the break-down is as follows:
 Category || Number || Percent 
 Technicians and associate professionals || 8 || 0,79 
 Clerks || 48 || 4,75 
 Craft and related trades workers || 11 || 1,09 
 Plant and machine operators and assemblers || 943 || 93,37 
17.         In accordance with Article
7 of Regulation (EC) No 1927/2006, Italy has confirmed that a policy of
equality between women and men as well as non-discrimination has been applied,
and will continue to apply, during the various stages of the implementation of
and, in particular, in access to the EGF.
Description of the territory
concerned and its authorities and stakeholders
18.         The territories concerned
by the redundancies are the regions of Piemonte and Toscana (NUTS 2 level) and
in particular the provinces of Torino and Livorno (NUTS 3 level), where the
production plants of De Tomaso Automobili S.p.A were located.
19.         The economic activity in
the eight Piemonte provinces varies, but is mostly linked to car manufacturing
(e.g. Group Fiat) or to the textiles industry. In 2009 the regional GDP of
Piemonte decreased by 3,9 %, mainly as a consequence of the impact of the
economic and financial crisis on the automotive industry and its ancillary
sectors. The reduction of the added value in the manufacturing sector was close
to 17 %. In 2010 began a recovery phase of growth (+2 %) which was
almost interrupted in 2011 (+0,7 %). In 2012 the number of businesses
active in Piemonte was 415 219 representing almost 8% of the total
businesses in Italy. Most of these businesses operate in wholesale and retail
(24,5 %), followed by construction (17,2 %), agriculture, forestry
and fishing (14,5 %) and manufacturing (9,9 %).
20.         In 2009, the GDP of the
Toscana region also declined, but less than in Piemonte
(-2 %), mainly due to the good performance of the service sector which
characterizes the regional economy. In 2012 the number of businesses active in
Toscana was 365 629 representing 7 % of the total businesses in Italy. The distribution of businesses operating by sector is very similar to Piemonte:
wholesale and retail (25,4 %), followed by construction (17,2 %),
agriculture, forestry and fishing (13,3 %) and manufacturing
(11,5 %).
21.         The main stakeholders are
the Regione Piemonte and Regione Toscana, the Torino and Livorno (NUTS 3)
public authorities and in particular the Torino and Grugliasco local
authorities, as well as Confindustria Livorno and SIT (employers
representatives) and the following trade unions: Confederazione Italiana del
lavoro (CISL) and FIM CISL; Confederazione Generale Italiana del
Lavoro (CGIL) and FIOM CGIL; Unione Italiana del Lavoro (UIL) and
UILM UIL; and FISMIC, Sindacato autonomo metalmeccanici e industrie colegate. 
Expected impact of the redundancies
as regards local, regional or national employment
22.         In Piemonte about
36 million hours were taken up by CIG[9]
in 2008 while in 2011 the number of hours taken up by CIG quadrupled and reached
up to 146 million hours. 
In Toscana the number of hours rose by 58,8 % in 2010 compared with 2008
and decreased by 12 % in 2011 compared with the previous year. Despite
this decline 48 million hours were taken up by CIG in 2011.
23.         The 1 030 former
workers of De Tomaso Automobili S.p.A covered by this application, to whom CIG
Straordinaria for cessation of activity following bankruptcy has been granted, will
further aggravate the situation in the territories concerned by the
redundancies.
Co-ordinated package of personalised
services to be funded and a breakdown of its estimated costs, including its
complementarity with actions funded by the Structural Funds
24.         All the following measures
combine to form a co-ordinated package of personalised services which aims at
re-integrating the redundant workers into employment:
–     
Vocational guidance, outplacement and job
search assistance: This first measure provided to
all participants includes information on available services and training
programmes; profiling and skills assessment of the workers; working out of an
individual project and an action plan; as well as job-search assistance
including information on available jobs, active research of the local and
regional employment opportunities and job-matching.
–     
Training, re-training and vocational training. This includes the recognition of prior experience (i.e. the
evaluation of prior knowledge and experience of each individual worker as well
as the identification of areas where further training is required) as well as
diverse pathways of training which can be part of the regional catalogue of
training courses or ad-hoc training organised to respond to the workers'
demands. The worker will receive a training voucher as a means of payment for
the relevant training. This measure also provides for agreements with
enterprises willing to hire former employees of De Tomaso, so that the hiring
enterprise receives a contribution for the on-the-job training expenses up to
EUR 1500 conditional on re-employment of workers under either permanent
contracts or fixed-term contracts of at least 12 months.
–     
Accompanying measures towards business
creation. Specific accompanying activities for
those workers who wish to start their own business will be provided, such as
identification of business ideas, establishing a business plan, raising
finance, etc. 
–     
Contribution to business start-up. The workers who set up their own businesses will receive EUR
5 000 as a contribution to cover setting-up costs. 
–     
Hiring benefit. The
enterprise which re-employs under a permanent contract a former De Tomaso
worker will receive up to EUR 6 300. When hiring a disabled
worker or a worker with caring responsibilities towards a disabled person, EUR 1 350
will top-up the hiring benefit which cannot exceed in any case the maximum
amount of EUR 6 300. The contribution will be granted upon request by
the company after the completion of recruitment, in accordance with the rules
and procedures established by the region.
–     
Job-search allowance. The workers participating in the EGF co-funded measures will
receive a job-search allowance which will be calculated according to the number
of actual hours of active participation in the measures. On average the
participation per worker is estimated at 86 hours.
–     
Contributions towards special expenses. This includes two types of contributions (1) Contribution for
carers of dependent persons: Workers with dependent persons (children, elderly
or disabled persons) could be reimbursed up to EUR 1 000 of the
expenses incurred for carers of dependent persons, conditional upon
participation in the measures. This aims to cover the additional costs faced by
the workers with caring responsibilities in order to avail themselves of
training or other measures. (2) Contribution to commuting expenses: the
workers participating in the measures, who will commute from their town of
residence to the town where the measures take place, will have their commuting
expenses reimbursed up to EUR 1 000.
25.         The expenditure for
implementing the EGF, which is included in the application in accordance with
Article 3 of Regulation (EC) No 1927/2006, covers preparatory,
management and control activities as well as information and publicity.
26.         The personalised services
presented by the Italian authorities are active labour market measures within
the eligible actions defined by Article 3 of Regulation (EC) No 1927/2006. The Italian
authorities estimate the total costs at EUR 5 189 345, of which
the expenditure for personalised services at EUR 4 987 732 and
the expenditure for implementing the EGF at EUR 201 613 (3,89 %
of the total amount). The total contribution requested from the EGF is
EUR 2 594 672 (50 % of the total costs).
 Actions || Estimated number of workers targeted || Estimated cost per worker targeted (EUR) (*) || Total costs (EGF and national cofinancing) (EUR) (**) 
 Personalised services (first paragraph of Article 3 of Regulation (EC) No 1927/2006) 
 Vocational guidance, outplacement and job search assistance (Orientamento professionale, outplacement e assistenza alla ricerca attiva) || 1 010 || 1 351 || 1 364 975 
 Training, re-training and vocational training (Attività di formazione e riqualificazione) || 1 010 || 1 565 || 1 580 500 
 Accompanying measures towards business creation. (Promozione dell'auto-imprenditorialità) || 20 || 3 000 || 60 000 
 Contribution to business start-up (Contributo all'auto-imprenditorialità) || 20 || 5 000 || 100 000 
 Hiring benefit (Contributo per l'assunzione dei lavoratori svantaggiati) || 200 || 4 500 || 900 000 
 Job-search allowance (Indemnità per la ricerca attiva) || 1 010 || 811 || 819 257 
 Contributions towards special expenses. (Voucher integrativo e voucher di conciliazione) || 135 || 1 207 || 163 000 
 Sub total personalised services ||   || 4 987 732 
 Expenditure for implementing EGF (third paragraph of Article 3 of Regulation (EC) No 1927/2006) 
 Preparatory activities ||   || 18 064 
 Management ||   || 95 786 
 Information and publicity ||   || 27 329 
 Control activities ||   || 60 434 
 Sub total expenditure for implementing EGF ||   || 201 613 
 Total estimated costs ||   || 5 189 345 
 EGF contribution (50 % of total costs) ||   || 2 594 672 
(*) To avoid decimals the estimated
costs per worker have been rounded. However the rounding has no impact on the
total cost of each measure which remains as in the application submitted by Italy.
(**) Totals do not tally due to
roundings.
27.         Italy confirms that the
measures described above are complementary with actions funded by the
Structural Funds. and that all double financing will be prevented.
Date(s) on which the personalised
services to the affected workers were started or are planned to start
28.         Italy started the
personalised services to the affected workers included in the co-ordinated
package proposed for co-financing to the EGF on 15 January 2013. This date
therefore represents the beginning of the period of eligibility for any
assistance that might be awarded from the EGF.
Procedures for consulting the social
partners
29.         The social partners
involved in the management of the crisis of De Tomaso S.p.A. participated as
well in the design of the coordinated package of measures. A steering committee
consisting of a representative from the regional authorities, the trade unions
and the RSU[10]
will ensure the monitoring of the EGF co-funded measures.
30.         The Italian authorities
confirmed that the requirements laid down in national and EU legislation
concerning collective redundancies have been complied with.
Information on actions that are
mandatory by virtue of national law or pursuant to collective agreements
31.         As regards the criteria
contained in Article 6 of Regulation (EC) No 1927/2006, the Italian authorities
in their application:
·      confirmed that the financial contribution from the EGF does not
replace measures which are the responsibility of companies by virtue of
national law or collective agreements;
·      demonstrated that the actions provide support for individual workers
and are not to be used for restructuring companies or sectors;
·      confirmed that the eligible actions referred to above do not receive
assistance from other EU financial instruments.
Management and control systems 
32.         Italy has notified the
Commission that the financial contribution will be managed as follows: The
Ministerio del lavoro e delle politiche sociali – Direzione Generale per le
Politiche attive e Passive del lavoro (MLPS – DG PAPL) is the managing,
certifying and audit authority (MLPS – DG PAPL Ufficio A as managing
authority; MLPS – DG PAPL Ufficio B as certifying authority and MLPS – DG
PAPL Ufficio C as audit authority). The Regione Piemonte and the Regione
Toscana will be the intermediate bodies for the managing authority.
Financing
33.         On the basis of the
application from Italy, the proposed contribution from the EGF to the
coordinated package of personalised services (including
expenditure to implement EGF) is EUR 2 594 672,
representing 50 % of the total cost. The Commission's proposed allocation
under the Fund is based on the information made available by Italy.
34.         Considering the maximum
possible amount of a financial contribution from the EGF under Article 10(1) of
Regulation (EC) No 1927/2006, as well as the scope for reallocating
appropriations, the Commission proposes to mobilise the EGF for the total
amount referred to above, to be allocated under heading 1a of the financial
framework.
35.         The proposed amount of
financial contribution will leave more than 25 % of the maximum annual
amount earmarked for the EGF available for allocations during the last four
months of the year, as required by Article 12(6) of Regulation (EC) No
1927/2006.
36.         By presenting this proposal
to mobilise the EGF, the Commission initiates the simplified trialogue
procedure, as required by Point 28 of the Interinstitutional Agreement of 17
May 2006, with a view to securing the agreement of the two arms of the
budgetary authority on the need to use the EGF and the amount required. The
Commission invites the first of the two arms of the budgetary authority that
reaches agreement on the draft mobilisation proposal, at appropriate political
level, to inform the other arm and the Commission of its intentions. In case of
disagreement by either of the two arms of the budgetary authority, a formal
trialogue meeting will be convened.
37.         The Commission presents
separately a transfer request in order to enter in the 2013 budget specific
commitment appropriations, as required in Point 28 of the Interinstitutional
Agreement of 17 May 2006.
Source of payment appropriations 
38.         Appropriations
allocated to the EGF budget line in the 2013 budget will be used to cover the
amount of EUR 2 594 672 needed for the present application.
Proposal for a
DECISION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL
on the mobilisation of the European
Globalisation Adjustment Fund in accordance with point 28 of the
Interinstitutional Agreement of 17 May 2006 between the European Parliament,
the Council and the Commission on budgetary discipline and sound financial
management (application EGF/2012/008 IT/De Tomaso Automobili from Italy)
THE EUROPEAN PARLIAMENT AND THE
COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the
Functioning of the European Union,
Having regard to the Interinstitutional
Agreement of 17 May 2006 between the European Parliament, the Council and the
Commission on budgetary discipline and sound financial management[11], and in particular point 28
thereof,
Having regard to Regulation (EC) No
1927/2006 of the European Parliament and of the Council of 20 December 2006
establishing the European Globalisation Adjustment Fund[12], and in particular Article
12(3) thereof,
Having regard to the proposal from the
European Commission[13],
Whereas:
(1)       The European Globalisation
Adjustment Fund (EGF) was established to provide additional support for workers
made redundant as a result of major structural changes in world trade patterns
due to globalisation and to assist them with their reintegration into the
labour market.
(2)       The Interinstitutional
Agreement of 17 May 2006 allows the mobilisation of the EGF within the annual
ceiling of EUR 500 million.
(3)       Italy submitted an
application to mobilise the EGF, in respect of redundancies in the enterprise De
Tomaso Automobili S.p.A., on 5 November 2012 and supplemented it by additional
information up to 5 March 2013. This application complies with the requirements
for determining the financial contributions as laid down in Article 10 of
Regulation (EC) No 1927/2006. The Commission, therefore,
proposes to mobilise an amount of EUR 2 594 672.
(4)       The EGF should, therefore,
be mobilised in order to provide a financial contribution for the application
submitted by Italy,
HAVE ADOPTED THIS DECISION:
Article 1
For the general budget of the European
Union for the financial year 2013, the European Globalisation Adjustment Fund
(EGF) shall be mobilised to provide the sum of EUR 2 594 672 in
commitment and payment appropriations.
Article 2
This Decision shall be published in the Official
Journal of the European Union.
Done at Brussels, 
For the European Parliament                       For
the Council
The President                                                 The
President
[1]               OJ C 139, 14.6.2006, p. 1.
[2]               OJ L 406, 30.12.2006, p. 1.
[3]               In accordance with the third paragraph of Article 3
of Regulation (EC) No 1927/2006.
[4]               International Organization of Motor Vehicle Manufacturers
OICA. www.oica.net
[5]               European Automobile Manufacturers' Association ACEA.
www.acea.be.
[6]               http://ec.europa.eu/enterprise/sectors/automotive/files/cars-21-final-report-2012_en.pdf
[7]               EGF/2012/008
De Tomaso (the case object of this proposal for decision), as well as, 
EGF/2007/001 PSA suppliers. COM(2007) 415, EGF/2007/010 Lisboa Alentejo.
COM(2008) 94, EGF/2008/002 Delphi. COM(2008) 547, EGF/2008/004
Castilla y León Aragón. COM(2009) 150, EGF/2009/013 Karmann. COM(2010) 007
and EGF/2012/005 Saab. COM(2012) 622
[8]               http://www.examiner.com/article/global-luxury-car-crisis
http://www.spiegel.de/international/business/crisis-hits-carmakers-daimler-and-porsche-cut-expectations-for-2013-a-857183.html
http://www.bloomberg.com/news/2012-09-27/ferrari-to-lamborghini-can-t-outrun-crisis-as-sales-slow.html
http://images.forbes.com/forbesinsights/StudyPDFs/automotive-outlook_report.pdf
[9]               CIG is a scheme under Italian law, consisting of a
financial benefit paid by Istituto Nazionale della Previdenza Sociale-INPS
(National Institute of the Social Security) in support of workers suspended
from undertaking their work or working reduced hours.
[10]             Rappresentanza Sindacale Unitaria (RSU) is a
workers' representative body which exists in every public and private working place.
A RSU consists of not fewer than three persons elected by all workers (whether union
members or not).
[11]             OJ C 139, 14.6.2006, p. 1.
[12]             OJ L 406, 30.12.2006, p. 1.
[13]             OJ C […], […], p. […].